[House Hearing, 111 Congress]
[From the U.S. Government Publishing Office]




               H.R. 2336, THE GREEN ACT OF 2009, PART II

=======================================================================

                                HEARING

                               BEFORE THE

                            SUBCOMMITTEE ON
                   HOUSING AND COMMUNITY OPPORTUNITY

                                 OF THE

                    COMMITTEE ON FINANCIAL SERVICES

                     U.S. HOUSE OF REPRESENTATIVES

                     ONE HUNDRED ELEVENTH CONGRESS

                             FIRST SESSION

                               __________

                             JUNE 16, 2009

                               __________

       Printed for the use of the Committee on Financial Services

                           Serial No. 111-45




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                 HOUSE COMMITTEE ON FINANCIAL SERVICES

                 BARNEY FRANK, Massachusetts, Chairman

PAUL E. KANJORSKI, Pennsylvania      SPENCER BACHUS, Alabama
MAXINE WATERS, California            MICHAEL N. CASTLE, Delaware
CAROLYN B. MALONEY, New York         PETER T. KING, New York
LUIS V. GUTIERREZ, Illinois          EDWARD R. ROYCE, California
NYDIA M. VELAZQUEZ, New York         FRANK D. LUCAS, Oklahoma
MELVIN L. WATT, North Carolina       RON PAUL, Texas
GARY L. ACKERMAN, New York           DONALD A. MANZULLO, Illinois
BRAD SHERMAN, California             WALTER B. JONES, Jr., North 
GREGORY W. MEEKS, New York               Carolina
DENNIS MOORE, Kansas                 JUDY BIGGERT, Illinois
MICHAEL E. CAPUANO, Massachusetts    GARY G. MILLER, California
RUBEN HINOJOSA, Texas                SHELLEY MOORE CAPITO, West 
WM. LACY CLAY, Missouri                  Virginia
CAROLYN McCARTHY, New York           JEB HENSARLING, Texas
JOE BACA, California                 SCOTT GARRETT, New Jersey
STEPHEN F. LYNCH, Massachusetts      J. GRESHAM BARRETT, South Carolina
BRAD MILLER, North Carolina          JIM GERLACH, Pennsylvania
DAVID SCOTT, Georgia                 RANDY NEUGEBAUER, Texas
AL GREEN, Texas                      TOM PRICE, Georgia
EMANUEL CLEAVER, Missouri            PATRICK T. McHENRY, North Carolina
MELISSA L. BEAN, Illinois            JOHN CAMPBELL, California
GWEN MOORE, Wisconsin                ADAM PUTNAM, Florida
PAUL W. HODES, New Hampshire         MICHELE BACHMANN, Minnesota
KEITH ELLISON, Minnesota             KENNY MARCHANT, Texas
RON KLEIN, Florida                   THADDEUS G. McCOTTER, Michigan
CHARLES A. WILSON, Ohio              KEVIN McCARTHY, California
ED PERLMUTTER, Colorado              BILL POSEY, Florida
JOE DONNELLY, Indiana                LYNN JENKINS, Kansas
BILL FOSTER, Illinois                CHRISTOPHER LEE, New York
ANDRE CARSON, Indiana                ERIK PAULSEN, Minnesota
JACKIE SPEIER, California            LEONARD LANCE, New Jersey
TRAVIS CHILDERS, Mississippi
WALT MINNICK, Idaho
JOHN ADLER, New Jersey
MARY JO KILROY, Ohio
STEVE DRIEHAUS, Ohio
SUZANNE KOSMAS, Florida
ALAN GRAYSON, Florida
JIM HIMES, Connecticut
GARY PETERS, Michigan
DAN MAFFEI, New York

        Jeanne M. Roslanowick, Staff Director and Chief Counsel
           Subcommittee on Housing and Community Opportunity

                 MAXINE WATERS, California, Chairwoman

NYDIA M. VELAZQUEZ, New York         SHELLEY MOORE CAPITO, West 
STEPHEN F. LYNCH, Massachusetts          Virginia
EMANUEL CLEAVER, Missouri            THADDEUS G. McCOTTER, Michigan
AL GREEN, Texas                      JUDY BIGGERT, Illinois
WM. LACY CLAY, Missouri              GARY G. MILLER, California
KEITH ELLISON, Minnesota             RANDY NEUGEBAUER, Texas
JOE DONNELLY, Indiana                WALTER B. JONES, Jr., North 
MICHAEL E. CAPUANO, Massachusetts        Carolina
PAUL E. KANJORSKI, Pennsylvania      ADAM PUTNAM, Florida
LUIS V. GUTIERREZ, Illinois          KENNY MARCHANT, Texas
STEVE DRIEHAUS, Ohio                 LYNN JENKINS, Kansas
MARY JO KILROY, Ohio                 CHRISTOPHER LEE, New York
JIM HIMES, Connecticut
DAN MAFFEI, New York












                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on:
    June 16, 2009................................................     1
Appendix:
    June 16, 2009................................................    11

                               WITNESSES
                         Tuesday, June 16, 2009

Sims, Hon. Ron, Deputy Secretary, U.S. Department of Housing and 
  Urban Development..............................................     3

                                APPENDIX

Prepared statements:
    Sims, Hon. Ron...............................................    12

 
               H.R. 2336, THE GREEN ACT OF 2009, PART II

                              ----------                              


                         Tuesday, June 16, 2009

             U.S. House of Representatives,
                        Subcommittee on Housing and
                             Community Opportunity,
                           Committee on Financial Services,
                                                   Washington, D.C.
    The subcommittee met, pursuant to notice, at 2:47 p.m., in 
room 2128, Rayburn House Office Building, Hon. Maxine Waters 
[chairwoman of the subcommittee] presiding.
    Members present: Representatives Waters, Cleaver, Green, 
Himes; Capito, and Jenkins.
    Also present: Representative Perlmutter.
    Chairwoman Waters. This hearing of the Subcommittee on 
Housing and Community Opportunity will come to order.
    Good afternoon, ladies and gentleman. I would like to thank 
your ranking member, Mrs. Capito, and the other members of the 
Subcommittee on Housing and Community Opportunity for joining 
me for a second hearing on H.R. 2336, the GREEN Act of 2009. 
Without objection, Representative Perlmutter, the author of 
this legislation, will be considered a member of the 
subcommittee for the duration of this hearing.
    Before we begin, I would like to note that H.R. 2454, the 
American Clean Energy and Security Act of 2009, is not the 
subject of today's hearing. While I understand member interest 
in this legislation, today's hearing is focusing solely on the 
GREEN Act.
    Our first hearing on this legislation was last Thursday, 
June 11th. At that hearing we heard from real estate experts, 
homebuilders, architects, green building experts, and 
affordable housing developers about the importance of green 
affordable housing, especially for low-income families. Today 
we are joined by the Honorable Ron Sims, Deputy Secretary of 
the Department of Housing and Urban Development, who will share 
HUD's perspectives about this legislation.
    As the largest operator of affordable housing in the 
Nation, HUD--and the low-income families it serves--is severely 
impacted by high energy costs. The Department spends an 
estimated $5 billion annually on energy, more than 10 percent 
of its annual budget, through utility allowances and connection 
with rental assistance payments and indirect operating 
subsidies to public housing authorities. By implementing energy 
savings of 5 percent a year over 5 years, HUD could realize $1 
billion in savings. The requirements of the GREEN Act could 
contribute to these savings.
    These savings would also benefit the 5 million families who 
reside in public or assisted housing. As we learned at last 
week's hearing, low-income families are more likely to be 
adversely impacted by high energy costs. These families are 
more likely to occupy older and less energy-efficient 
buildings. According to one study, they spend approximately 16 
percent of their annual income on energy, which is 4.4 times 
more than higher-income families spend.
    As a result, some families must make the difficult choice 
of heating their homes or seeking other necessities such as 
medical care, food, or transportation. No family should have to 
make these kinds of choices. Affordable energy should be 
available for everyone.
    I am very interested to hear the Department's perspective 
on how the green building provisions in the GREEN Act will 
assist in development of energy-efficient housing, protecting 
the environment, and providing affordable clean energy to low-
income families.
    I would now like to recognize our subcommittee's ranking 
member to make an opening statement. Mrs. Capito?
    Mrs. Capito. Thank you. I would like to thank the 
chairwoman for her dedication to housing and green housing. I 
would like to thank the bill's sponsor, Mr. Perlmutter, because 
he has worked this issue very aggressively, and I think made a 
lot of changes in response to questions that many members might 
have had.
    I don't have a formal opening statement. I am interested to 
hear our witness in terms of past programs that HUD has been 
involved in to encourage energy efficiency, what kind of 
success those programs have had, and how they can be reshaped. 
If this bill were to become law, would it interfere, enhance, 
or otherwise--are there any potential conflicts inherent in the 
incentives built in for green building here as opposed to what 
is already existing in HUD?
    I think the goals are laudable and I believe that energy 
efficiency will result in cost savings all across-the-board 
individually and as a whole. So I thank the witness for coming 
and I, again, want to thank the chairwoman for her kindness. 
Thank you.
    Chairwoman Waters. Thank you very much. I will now 
recognize Mr. Himes for 5 minutes.
    Mr. Himes. Thank you, Madam Chairwoman, and thank you very 
much, Mr. Sims, for being here today.
    I am very, very excited about this topic and about the 
legislation that was authored by my colleague, Ed Perlmutter of 
Colorado. I spent 5 or 6 years working with Enterprise 
Community Partners on trying to instill green building 
standards into the construction of affordable housing.
    It is a triple win. It saves people money on their utility 
bills, and we are talking about people for whom, of course, 
utility bills are a substantial portion of their monthly cash 
flow. It solves health problems in communities where health 
problems are often concentrated, and of course it contributes 
to the exercise that we are all engaged in here, in fact 
globally engaged in, trying to reduce the amount of pollution 
that we put into the air and reverse the tide of global 
warming. So I am enormously excited about the content of this 
bill.
    Thank you for being with us. I hope that we can work 
together in the coming months to really see this bill passed 
through Congress, signed by the President, and adopted 
enthusiastically by HUD so that we collectively, and of course 
the people that HUD serves, can take advantage of the many, 
many benefits that come from building smarter and building 
greener. I am delighted you are here and I am looking forward 
to your testimony.
    Chairwoman Waters. Thank you. Ms. Jenkins? No?
    Mr. Cleaver?
    Mr. Cleaver. Madam Chairwoman, I don't have any questions. 
We have had, I think, some very beneficial hearings, and I 
wanted to thank Mr. Perlmutter for his vision. I strongly 
support his efforts. I think this kind of legislation is long 
overdue, and I yield back the balance of my time.
    Chairwoman Waters. Thank you very much.
    Mr. Perlmutter, without objection, you will be considered a 
member of the subcommittee for the duration of the hearing. I 
understand you don't have a statement at this point. Yes?
    Mr. Perlmutter. Thank you, Madam Chairwoman, and thank you 
to the committee for letting me participate.
    Just a quick statement. This bill is the development of a 
task force which was comprised of Republicans and Democrats. We 
worked with a lot of organizations, and I just wanted to thank 
HUD for from time to time providing some input and guidance on 
this bill, and they have worked with us to develop this and to 
move towards energy efficiency which, again, is kind of a 
triple win. It is good for national security, it is good for 
the climate, and it is good for jobs, so I look forward to your 
testimony today, sir.
    Chairwoman Waters. Thank you very much. We have been joined 
by Mr. Green. I will recognize Mr. Green for an opening 
statement.
    Mr. Green. Thank you, Madam Chairwoman. As has been 
indicated, I too am looking forward to the testimony, and I 
yield back the balance of my time. Thank you.
    Chairwoman Waters. Thank you very much. There are no more 
opening statements.
    We will now go to our witness, our only witness today who 
is with us, the Honorable Ron Sims, Deputy Secretary of the 
United States Department of Housing and Urban Development. 
Welcome, sir. You may begin.

  STATEMENT OF THE HONORABLE RON SIMS, DEPUTY SECRETARY, U.S. 
          DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

    Chairwoman Waters. Is your microphone on?
    Mr. Sims. I was told I would have--I have only been here 
for 4 weeks. I am still getting used to these microphones. I 
apologize.
    Good afternoon, Chairwoman Waters, Ranking Member Capito, 
Congressman Perlmutter, and distinguished members of the 
subcommittee. It is my pleasure to be here. I want to commend 
you, Congresswoman Waters, for your leadership on this issue, 
as well as Congressman Perlmutter for his commitment to energy 
efficient affordable housing and for his hard work on this 
bill.
    The GREEN Act represents an important effort to address the 
high cost of heating, lighting, and cooling housing in the 
United States, especially affordable housing. I understand that 
this bill passed the House last year and that HUD staff have 
been helpful in providing you with technical guidance. I want 
to pledge to you our continued cooperation and assistance as we 
go forward.
    Before coming to HUD, I was the King County executive, an 
elected position in one of the largest counties in the United 
States, where we developed one of the most cutting-edge green 
building and smart growth programs in the country. Secretary 
Donovan has a clear vision on these issues. He is creating a 
new Office of Sustainable Housing and Communities at HUD, and 
has asked me to oversee, as one of my functions, that office. 
In that capacity, I will be responsible for synchronizing our 
efforts with those across government, and for implementing 
HUD's green building and energy efficiency initiatives, as we 
bring some of the best ideas to build strong, sustainable 
communities that are being developed at the local level to the 
national stage.
    So I have a strong interest in the outcome of this 
legislation. I have submitted a longer statement for the 
record, but I would like to focus my remarks on one of the 
questions that you asked me to address. What is the effect of 
green development on low- and moderate-income households and 
communities? It is an important question because some are 
concerned that the so-called green premium--that is the added 
cost of building green can hurt rather than help low-income 
families.
    Put simply, I do not subscribe to that view at all. I 
believe that we can't afford not to build green. I am committed 
to making HUD a leader in green development, precisely because 
of the benefits it will provide to people across the economic 
spectrum, and low-income families in particular.
    First and foremost, we need to dispel the notion that green 
building will mean higher energy costs for low-income families. 
While everyone is hurt by high energy costs, no one is hurt 
more than--no one is more vulnerable to rising energy prices 
than low- and moderate-income families, often cutting back on 
their other needs such as medicine, food, and education when 
costs go up. Large-scale green initiatives such as the 
Enterprise Green Communities program show that properties 
achieving 20 to 30 percent greater efficiency yield cost 
savings that accrue directly to low-income residents, or are 
reinvested back into property in which they live.
    HUD's own budget is compromised by skyrocketing energy 
costs. HUD spends $5 billion on energy for our public housing 
and Section 8 operations. A modest savings of just 5 percent 
could generate a savings of more than $1 billion for the 
taxpayers over the next 5 years.
    I am pleased to report that under Secretary Donovan's 
leadership, HUD has made an historic commitment to energy 
efficiency that began with the economic recovery package. We 
have established partnerships with the Department of Energy, 
the EPA, and the Department of Transportation. And we have 
several exciting Fiscal Year 2010 budget proposals, including a 
$100 million Energy Innovation Fund that will seed local energy 
retrofit funds and re-engineer FHA's Energy Efficient 
Mortgages. This will help families invest in energy efficiency 
when they buy a home or refinance their home mortgages.
    Sustainable green building has a clear connection to better 
health as well. In King County, we did a study called 
HealthScape, which looked specifically at how the built 
environment and transportation systems impact public health and 
climate change. What we found was that while people living in 
the most walkable communities of the county were less likely to 
be overweight and were more likely to be physically active, 
wide health disparities existed between low-income families and 
persons of color and the rest of the population. Right now, we 
can predict morbidity rates and life expectancy by zip codes. A 
zip code! Place matters.
    But as we saw in the High Point public housing project 
development in King County, a commitment to building green can 
be a big part of rejecting the certainty of illness for 
millions of children. In addition to walkability, by adding 
green features specifically designed to reduce asthma triggers, 
the number of asthma-free days increased, and mold, which often 
causes dangerous infections--I'm an asthmatic--was completely 
eliminated.
    [The prepared statement of Deputy Secretary Sims can be 
found on page 12 of the appendix.]
    Chairwoman Waters. Thank you very much, Mr. Sims. That is 
one of the things you will learn about the committee. We do 
gavel at about 5 minutes.
    Mr. Sims. I do appreciate that.
    Chairwoman Waters. We do have a little bit of flexibility.
    Welcome.
    Mr. Sims. Thank you.
    Chairwoman Waters. Thank you for coming today. At this 
point, we get to ask you questions.
    Mr. Sims. Please.
    Chairwoman Waters. I will recognize myself for the first 5 
minutes of questions. Basically, mine is a general one.
    We hear a lot about saving energy costs by going green, and 
we hear a lot of talk about the jobs that will be created. 
Coming from King County, did you, with the work that you were 
doing, experience job creation, and were there a lot of jobs 
that came about as a result of going green?
    Mr. Sims. We worked with South Seattle Community College to 
specifically design programs for people who would not otherwise 
be employed to enter the green industry. And in the projects 
that we built green, we used that workforce. We wanted to 
develop a new one with the skills to handle new green 
technologies, whether those were smart grid technologies, 
whether those were wind technologies. So the answer is yes, we 
believe that in fact building green creates new employment 
opportunities, new industries, new technologies, and is a job 
creator.
    Chairwoman Waters. As you know, HUD has the responsibility 
for all of the public housing in the United States, and I do 
believe that we can create a lot of savings, even before we 
redevelop and retrofit, but there does not appear to be any 
effort to educate residents of public housing about how they 
can conserve energy, and I have not seen any program of 
incentives to do so. I believe that if we put on an education 
program to show the residents how they can save energy and 
provide a few incentives to do so, that we could save a lot of 
money.
    As a matter of fact, I think we could reduce our energy 
costs significantly while at the same time, maybe giving a few 
dollars off the rent as an incentive for turning off the lights 
and being more energy efficient. Do you think this is the kind 
of program that could help us in our efforts to go green and to 
create savings?
    Mr. Sims. I believe it is important to have an educated 
group of individuals who are your tenants know how to use 
energy efficiently within their home. But there still is an 
obligation to provide capital investments that would be present 
to also complement their own efforts at reducing their energy 
costs. I think you need to do both.
    We have created an Office of Sustainability and have been 
working with public housing authorities; our issue with them is 
how do we do the retrofits. We are doing those very 
aggressively through the stimulus funds. And we are applying 
the energy efficiency retrofits in a variety of different ways 
in order to find out what is the best methodology to achieve 
energy efficiency, both through education and capital 
investment. But we are doing that with the stimulus funds now.
    Chairwoman Waters. Well, thank you very much. Again, 
welcome. Your work is cut out for you, and perhaps you will be 
over here with us many more times.
    Mr. Sims. Madam Chairwoman, I look forward to that. Thank 
you.
    Chairwoman Waters. Thank you very much. Mrs. Capito?
    Mrs. Capito. Thank you. Thank you, Mr. Sims.
    I had a couple of questions, they are kind of specific, but 
let me just ask you, you have been at HUD for what, a month? Is 
that correct?
    Mr. Sims. Four weeks.
    Mrs. Capito. Four weeks. So I will forego a lot of the 
specificity, if that is all right with you.
    In section five of the bill is a demonstration project for 
multi-family housing projects for Section 8, and it calls for 
50,000 units over 4 years. It seems like, in my view--and there 
are some qualifiers in here--from your knowledge of Section 8 
and the available funds and the availability of units, is this 
a reachable goal? Is this something that you think under that 
very large program is something that is achievable, or do you 
have an opinion on that?
    Mr. Sims. The Department is committed to using Section 8 in 
a way to create energy efficient homes. I think obviously we 
are concerned about the cost--there are other issues related to 
Section 8. But we are committed to trying to green our 
inventory and that of people who are our partners as well. We 
would like to work with the committee on that particular issue.
    Mrs. Capito. I would speculate, then, some--and there is 
some flexibility, I believe, built into this section if it is 
not achievable in 4 years. I would recommend that, because that 
is a pretty steep mountain.
    The other question I have, and I don't know if you have 
read this specifically, but there is a section six that goes 
for additional credit for Fannie Mae and Freddie Mac housing 
goals for energy efficient mortgages. Under the current 
environment with Fannie Mae and Freddie Mac basically being 
taken over by the government and having difficulties, very 
large difficulties, do you see any problems with putting 
another mission, I would say, rather than mandate--it wouldn't 
be a mandate--mission to Fannie and Freddie where they would 
receive 100 percent, 25 percent credit? Do you have any opinion 
on that section of the bill?
    Mr. Sims. Within our own budget we are--2010 budget, we are 
creating a revenue regarding what we can do in FHA in terms of 
energy efficient mortgages and location-specific mortgages. 
When you look at the GSEs and their ability to provide 
incentives, our issue is what is--will the market respond and 
how will it respond?
    We believe that--we have taken what we call a cautious, but 
we believe a prudent, step at putting money in the 2010 budget 
to begin to explore how to make that market, what makes it 
attractive. And so we are doing that in our 2010 budget and we 
believe that would be a good demonstration for a larger effort, 
but we want to at least know how to do it first, and will the 
market respond.
    Mrs. Capito. My final question is, I am from a rural part 
of the country, and many of the standards that are--whether it 
is LEED or some other standards, green building standards--the 
urban areas, I would say, are traditionally leading, more on 
the--well, there are more people, there are more educational 
facilities, people are experimenting more with energy 
efficiency.
    My concern is--and I voiced this, and Mr. Perlmutter and I 
talked about this--that if we are setting a goal in a State 
like West Virginia to achieve energy efficiency and to try to 
get some of the financial benefits that would be associated 
with that in terms of more favorable mortgages or anything of 
that nature, I'm concerned are we going to have enough 
inspectors who are trained in this to really make an 
evaluation? Are they going to be able to travel to the rural 
areas to be able to ascertain--
    I don't want to see a situation--we want to incent 
everybody to move in this direction, and I think if you can't 
find somebody to really do a true, good evaluation of your home 
structure or your business structure because of the lack of 
availability of somebody there to actually make that 
determination--I would like to work with the sponsor and with 
HUD for the education portion of this, because I think it is 
going to be really important that it reaches all areas in the 
country.
    Mr. Sims. I look forward to having that meeting with you. 
We would love to work with you on that.
    Mrs. Capito. Thank you.
    Chairwoman Waters. Thank you very much.
    Mr. Cleaver?
    Mr. Cleaver. Thank you, Madam Chairwoman.
    Mr. Secretary, welcome. We are glad to have you here.
    One of the things I hope we can do with this legislation--
and this may also actually need to be discussed with Mr. 
Perlmutter--is that this would be living legislation in the 
sense that as new technologies become available, I would hope 
that we would have the flexibility in this legislation to make 
adjustments. I mean, even just since Mr. Perlmutter's 
introduction of this bill, we have discovered, for example, 
that white rooftops on buildings reduce energy costs 
substantially, and when we think about public housing--having 
lived in public housing--is something that is probably not 
going to be a major cost, but it could be a major savings.
    The other question is my interpretation of this legislation 
that I want to make sure is correct, and that is that the green 
collar jobs that will be needed to do the work will also be 
available through training in this legislation. Am I on board? 
Residents and--
    Mr. Sims. Yes, that is correct.
    Mr. Cleaver. I have no other questions. Thank you. I yield 
back the balance of my time.
    Chairwoman Waters. Thank you very much.
    Mr. Green?
    Mr. Green. Thank you, Madam Chairwoman, and I thank the 
witness for his testimony.
    The bill, as I see it, is one that I am going to gladly 
support. Mr. Perlmutter has done an outstanding job in working 
this, and I am especially pleased that he has chosen to add my 
name to it. It makes it a lot easier to support.
    [laughter]
    Mr. Green. When I am home and I'm talking about the GREEN 
Act, I will be sure to mention you at some point.
    But on the serious side, I want to ask you about the 
revolving fund. I think this is a capital idea, and I think 
that it is something that would be of great benefit to the 
States. Is this something that you agree with me on?
    Mr. Sims. I think we want to make sure that if we establish 
a revolving fund that there is a method of ensuring its 
continued refreshing as a condition of investment in the 
future.
    Mr. Green. Well, absolutely. We want to continue it, and I 
will assure Mr. Perlmutter that I'm going to do what I can to 
help him with that. I think that is a key part of the 
legislation.
    Thank you, Madam Chairwoman. I yield back the balance of my 
time. Thank you, sir.
    Chairwoman Waters. Thank you very much. I will call on the 
author of the bill and grant him as much time as he sees fit. 
This will be the first and the last time that he will ever have 
that much time. Mr. Perlmutter, thank you.
    Mr. Perlmutter. Thank you, Madam Chairwoman, and I really 
will be brief. I appreciate the gentleman for his testimony, 
and thank you.
    I would first ask two questions that you and the ranking 
member asked, Madam Chairwoman. In section 18 of the bill--
there are a lot of sections to this bill--there is the training 
and education--that is one of the training and education 
sections for both training as to construct and install energy 
efficient measures, but also how to conserve, which would be 
from the tenant's spot. Also there is a piece in there about 
energy audits as well, which I know is Mrs. Capito's concern, 
is there somebody who really can appraise and understand how to 
retrofit the house, and what it is worth, and those things.
    So we tried to address that, but I am certainly happy to 
take all comments and make changes that are necessary. There 
are also several rural housing pieces and desire to make sure 
that whether they are Native American housing issues or rural 
housing issues, wherever they might be in the country, that we 
try to address that as well. I think, Mr. Secretary, you would 
agree.
    And then the last thing is there is a lot of discretion 
given to the Secretary in this bill to update and to try to 
stay up with the technology and the changes in codes and things 
like that throughout the country so that HUD really is at the 
forefront of energy efficiency, both--it assists the tenants, 
clearly, and it assists the bottom line of the United States of 
America so that we can try to minimize our energy costs.
    I would ask you one question, Mr. Secretary. There is an 
interesting section that is a new section from what we proposed 
last year, and that has to do with leasing of units, the 
concept being that in building a new home, the homebuilder or 
homeowner grants an easement on the roof to the solar company, 
and then the solar company for a certain period of time leases 
the solar energy unit to the homeowner who rents it for $40 a 
month, but he has $80 a month in savings. So it is a good 
approach, no upfront costs. The solar company maintains 
ownership and operations and maintenance of the unit.
    But where the Federal Government comes in is that at the 
back end of the lease, the last 10 years of a 20-year lease, 
there is some insurance provided by the United States to assist 
the whole leasing mechanism. Are you familiar with this 
section? I think it is section 27 of the bill. And I know it is 
kind of a new area that we are asking HUD to move into, but 
what are your thoughts about that?
    Mr. Sims. I was briefed on it, and the issue of the 
leasing, particularly whether it is--you are talking about 
whether it is solar or other alternative--
    Mr. Perlmutter. It could be any renewable source, right.
    Mr. Sims. We are doing a pretty extensive study right now 
on some units that we now have in place so that we can--we are 
going to be able to quantify what we consider to be the 
efficiencies by dollar that we would use to lay out what you 
call the lease terms, so we are very intrigued by that 
particular section of the bill.
    Mr. Perlmutter. Madam Chairwoman, again, I would offer to 
HUD and to all the members of this committee as we go forward, 
this really is an attempt to have lots of input from everybody 
to make it the best bill that we can get out of this place, and 
to be good for low- to moderate-income earners across the 
country, but also move us to an energy efficient and renewal 
energy future.
    So I would yield back, Madam Chairwoman, and I just thank 
you for the opportunity to be part of your committee.
    Chairwoman Waters. Thank you very much. This may be a 
record time for having a hearing on any subject in this 
committee.
    I would note that some members may have additional 
questions for this witness which they may wish to submit in 
writing, so without objection, the hearing record will remain 
open for 30 days for members to submit written questions to 
this witness and to place his responses in the record.
    This panel is now dismissed.
    Do we have any submissions to make a part of the record? If 
not, this subcommittee is adjourned, and we thank our witness 
here today. I'm sure, again, we will see a lot more of you in 
the future.
    This subcommittee is adjourned.
    [Whereupon, at 3:18 p.m., the hearing was adjourned.]



                            A P P E N D I X



                             June 16, 2009


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