    [Senate Hearing 111-173]
    [From the U.S. Government Publishing Office]

                                                            S. Hrg. 111-173

                          NOMINATIONS OF: RONALD SIMS,
                      FRED P. HOCHBERG, HELEN R. KANOVSKY,
                         DAVID H. STEVENS, PETER KOVAR,
                      JOHN D. TRASVINA, AND DAVID S. COHEN

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

                                    HEARING

                                   before the

                                  COMMITTEE ON
                       BANKING,HOUSING,AND URBAN AFFAIRS
                              UNITED STATES SENATE

                         ONE HUNDRED ELEVENTH CONGRESS

                                 FIRST SESSION

                                       ON

                                nominations of:

              Ronald Sims, of Washington, to be Deputy Secretary,
                  Department of Housing and Urban Development

                                   __________

          Fred P. Hochberg, of New York, to be President and Chairman,
                               Export-Import Bank

                                   __________

             Helen R. Kanovsky, of Maryland, to be General Counsel,
                  Department of Housing and Urban Development

                                   __________

          David H. Stevens, of Virginia, to be Assistant Secretary for
                     Housing-Federal Housing Commissioner,
                  Department of Housing and Urban Development

                                   __________

     Peter Kovar, of Maryland, to be Assistant Secretary for Congressional
                         and Intergovernmental Affairs,
                  Department of Housing and Urban Development

                                   __________

         John D. Trasvina, of California, to be Assistant Secretary for
                      Fair Housing and Equal Opportunity,
                  Department of Housing and Urban Development

                                   __________

           David S. Cohen, of Maryland, to be Assistant Secretary for
                              Terrorist Financing,
                           Department of the Treasury

                                   __________

                                 APRIL 23, 2009

                                   __________

      Printed for the use of the Committee on Banking, Housing, and Urban
                                    Affairs

          Available at: http: //www.access.gpo.gov /congress /senate/
                                senate05sh.html

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                COMMITTEE ON BANKING, HOUSING, AND URBAN AFFAIRS

                   CHRISTOPHER J. DODD, Connecticut, Chairman

    TIM JOHNSON, South Dakota            RICHARD C. SHELBY, Alabama
    JACK REED, Rhode Island              ROBERT F. BENNETT, Utah
    CHARLES E. SCHUMER, New York         JIM BUNNING, Kentucky
    EVAN BAYH, Indiana                   MIKE CRAPO, Idaho
    ROBERT MENENDEZ, New Jersey          MEL MARTINEZ, Florida
    DANIEL K. AKAKA, Hawaii              BOB CORKER, Tennessee
    SHERROD BROWN, Ohio                  JIM DeMINT, South Carolina
    JON TESTER, Montana                  DAVID VITTER, Louisiana
    HERB KOHL, Wisconsin                 MIKE JOHANNS, Nebraska
    MARK R. WARNER, Virginia             KAY BAILEY HUTCHISON, Texas
    JEFF MERKLEY, Oregon
    MICHAEL F. BENNET, Colorado

                     Colin McGinnis, Acting Staff Director
                  William D. Duhnke, Republican Staff Director
                           Amy Friend, Chief Counsel
                      Joe Hepp, Professional Staff Member
                    Neal Orringer, Professional Staff Member
                   Mark F. Oesterle, Republican Chief Counsel
                           Dawn Ratliff, Chief Clerk
                          Devin Hartley, Hearing Clerk
                          Shelvin Simmons, IT Director
                              Jim Crowell, Editor

                                      (ii)

                                C O N T E N T S

                                  ----------

                            THURSDAY, APRIL 23, 2009

                                                                       Page

    Opening statement of Chairman Dodd...............................     1

    Opening statements, comments, or prepared statements of:
        Senator Shelby...............................................    13
        Senator Schumer
            Introduction of Nominee Fred P. Hochberg.................     9
        Senator Johanns..............................................    14
        Senator Merkley..............................................    14
        Senator Reed.................................................    19
        Senator Warner
            Introduction of Nominee David H. Stevens.................    12

                                   WITNESSES

    Patty Murray, a U.S. Senator from the State of Washington........     5
    Maria Cantwell, a U.S. Senator from the State of Washington......     7
    Barney Frank, a U.S. Representative from the State of
      Massachusetts..................................................     8
    Adam B. Schiff, a U.S. Representative from the State of
      California.....................................................    11

                                    NOMINEES

    Ronald Sims, of Washington, to be Deputy Secretary, Department of
      Housing and Urban Development..................................    16
        Prepared statement...........................................    28
        Biographical sketch of nominee...............................    29
        Response to written questions of:
            Senator Dodd.............................................   111
            Senator Shelby...........................................   113
            Senator Menendez.........................................   115
            Senator Bennett..........................................   117
            Senator Crapo............................................   118
            Senator Vitter...........................................   119
    Fred P. Hochberg, of New York, to be President and Chairman,
      Export-Import Bank.............................................    18
        Prepared statement...........................................    44
        Biographical sketch of nominee...............................    45
        Response to written questions of:
            Senator Dodd.............................................   121
            Senator Shelby...........................................   122
            Senator Bunning..........................................   123
    Helen R. Kanovsky, of Maryland, to be General Counsel, Department
      of Housing and Urban Development...............................    20
        Prepared statement...........................................    60
        Biographical sketch of nominee...............................    62
        Response to written questions of:
            Senator Shelby...........................................   124
            Senator Crapo............................................   125

                                     (iii)

    David H. Stevens, of Virginia, to be Assistant Secretary for
      Housing-Federal Housing Commissioner, Department of Housing and
      Urban Development..............................................    22
        Prepared statement...........................................    69
        Biographical sketch of nominee...............................    71
        Response to written questions of:
            Senator Dodd.............................................   126
            Senator Shelby...........................................   128
            Senator Bayh.............................................   129
            Senator Crapo............................................   130
            Senator Corker...........................................   132
            Senator Vitter...........................................   132
    Peter Kovar, of Maryland, to be Assistant Secretary for
      Congressional and Intergovernmental Affairs, Department of
      Housing and Urban
      Development....................................................    23
        Prepared statement...........................................    80
        Biographical sketch of nominee...............................    82
        Response to written questions of:
            Senator Dodd.............................................   134
            Senator Shelby...........................................   135
    John D. Trasvina, of California, to be Assistant Secretary for
      Fair Housing and Equal Opportunity, Department of Housing and
      Urban Development..............................................    25
        Prepared statement...........................................    92
        Biographical sketch of nominee...............................    94
        Response to written questions of:
            Senator Dodd.............................................   135
            Senator Menendez.........................................   138
            Senator Vitter...........................................   144
    David S. Cohen, of Maryland, to be Assistant Secretary for
      Terrorist
      Financing, Department of the Treasury..........................    26
        Prepared statement...........................................   103
        Biographical sketch of nominee...............................   104
        Response to written questions of:
            Senator Dodd.............................................   145
            Senator Shelby...........................................   147
            Senator Menendez.........................................   150
            Senator Bunning..........................................   151
            Senator Vitter...........................................   152

                  Additional Material Supplied for the Record

    Statement of Edward M. Kennedy, a U.S. Senator from the State of
      Massachusetts..................................................   155
    Statement of John F. Kerry, a U.S. Senator from the State of
      Massachusetts..................................................   155

    Letter submitted by the King County Housing Authority............   156
    Letter submitted by the National Association of Housing and
      Redevelopment Officials, Pacific Northwest Regional Council....   158
    Letter submitted by the Seattle Housing Authority................   159
    Letter submitted by Transportation for America...................   160
    Letter submitted by the National Association of Counties.........   161
    Letter submitted by the Coalition for Employment Through Exports,
      Inc............................................................   162
    Letter submitted by the Real Estate Services Providers Council,
      Inc............................................................   163
    Letter submitted by the Manufactured Housing Institute...........   164
    Letter submitted by the Asian Real Estate Association of America.   165
    Letter submitted by the National Association of Realtors.........   166
    Letter submitted by Self-Help and the Center for Responsible
      Lending........................................................   166
    Letter submitted by Bernard K. Melekian, Chief of Police,
      Pasadena Police Department.....................................   167
    Letter submitted by the National Fair Housing Alliance...........   168
    Letter submitted by SER-Jobs for Progress National, Inc..........   169
    Letter submitted by Gavin Newsom, Mayor, City and County of
      San Francisco..................................................   170
    Letter submitted by the National Association of Judiciary
      Interpreters and Translators...................................   171
    Letter submitted by the Hispanic National Bar Association........   172
    Letter submitted by MANA, A National Latina Organization.........   174

                                NOMINATIONS OF:

                          RONALD SIMS, OF WASHINGTON,

                            TO BE DEPUTY SECRETARY,

                  DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT;

                         FRED P. HOCHBERG, OF NEW YORK,

                         TO BE PRESIDENT AND CHAIRMAN,

                              EXPORT-IMPORT BANK;

                        HELEN R. KANOVSKY, OF MARYLAND,

                             TO BE GENERAL COUNSEL,

                  DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT;

                         DAVID H. STEVENS, OF VIRGINIA,

      TO BE ASSISTANT SECRETARY FOR HOUSING-FEDERAL HOUSING COMMISSIONER,

                  DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT;

                           PETER KOVAR, OF MARYLAND,

       TO BE ASSISTANT SECRETARY FOR CONGRESSIONAL AND INTERGOVERNMENTAL
                                    AFFAIRS,

                  DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT;

                        JOHN D. TRASVINA, OF CALIFORNIA,

       TO BE ASSISTANT SECRETARY FOR FAIR HOUSING AND EQUAL OPPORTUNITY,

                  DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT;

                          DAVID S. COHEN, OF MARYLAND,

               TO BE ASSISTANT SECRETARY FOR TERRORIST FINANCING,

                           DEPARTMENT OF THE TREASURY

                                  ----------

                            THURSDAY, APRIL 23, 2009

                                           U.S. Senate,
              Committee on Banking, Housing, and Urban Affairs,
                                                        Washington, DC.
        The Committee met at 10:43 a.m., in room SD-538, Dirksen
    Senate Office Building, Senator Christopher J. Dodd (Chairman
    of the Committee) presiding.

           OPENING STATEMENT OF CHAIRMAN CHRISTOPHER J. DODD

        Chairman Dodd. The Committee will come to order, and let me
    apologize to our witnesses and colleagues for the slight delay.
    We have a bill on the floor of the Senate that is out of the
    Judiciary Committee, but given the number of amendments that
    have been offered, you would almost think it was a Banking
    Committee bill. And so Senator Leahy was asking for me to stay
    on the floor to consider some of the amendments being offered,
    and we are going to try and work something out so that we can
    maybe have a Member here complete the nomination process if I
    am unable to complete it in order to get to the floor to
    participate in the debates on the Judiciary Committee bill. So
    I apologize. We are trying to work this all out, and we added
    some confusion this morning, and I now how busy people are in
    terms of schedules.
        What I am going to do is make some brief opening comments,
    and then I am going to recognize, with the permission of my
    colleagues on the Committee, our members who have joined us
    here, including the distinguished Chairman of the House
    Financial Services Committee, Congressman Frank, to make some
    introduction of witnesses. And then I will go to my colleagues
    on the Committee for any comments they may have and then, of
    course, to our witnesses.
        We have quite a panel here this morning, and we are
    grateful to all of you for your willingness to serve. I want to
    congratulate you on being nominated, and thank you, as I said,
    for your willingness to be a part of the change that we all
    seek in our country. So I would like to welcome all of you here
    this morning.
        As you know, this Committee has been working closely with
    the administration to implement the various programs that will
    provide critically important issues to our Nation's economic
    recovery. An integral part of this process is the selection of
    strong and very talented leaders to oversee and manage the
    operations of these programs and departments.
        The American people are looking for leaders who will help
    bring us out of our crisis that we are in economically by
    fixing our housing problem, promoting economic growth, and
    stabilizing our financial system. It will be those of you
    sitting before this Committee this morning who, if confirmed,
    will be charged with carrying out these very important
    responsibilities.
        Today we consider seven nominations: Mr. Ronald Sims, of
    Washington, the State of Washington, to be the Deputy Secretary
    of the U.S. Department of Housing and Urban Development, or
    HUD; Mr. Fred Hochberg, of New York, to be Chairman and
    President of the U.S. Export-Import Bank; Ms. Helen Kanovsky,
    of Maryland, to be the General Counsel of HUD; Mr. David
    Stevens, of Virginia, to be the Assistant Secretary for Housing
    and Federal Housing Commissioner; Mr. Peter Kovar, also of
    Maryland, to be Assistant Secretary for Congressional and
    Intergovernmental Affairs of HUD; Mr. John Trasvina, of
    California, to be Assistant Secretary for Fair Housing and
    Equal Opportunity for HUD; and Mr. David Cohen, of Maryland, to
    be Assistant Secretary for Terrorist Financing at the U.S.
    Department of the Treasury.
        As my colleagues know, we will have more nomination
    hearings to go, so I will be consulting with my colleagues on
    this Committee in an effort to develop a schedule for another
    hearing in the very near future.
        It has always been this Committee's view, particularly
    given the urgency of our economic situation, that we ought to
    help get the President's Cabinet in place as quickly as
    possible. We have five HUD nominees before us today, and if the
    housing crisis is at the root of the economic crisis, as I
    believe it is, then I believe you in many ways will be the
    authors at least of a good portion of the economic recovery we
    all seek.
        For the past 3 or 4 years, the country has been facing a
    very serious housing problem that has its origins in the
    scourge of predatory lending resulting in record-high
    foreclosure rates. Across our Nation, between 9,000 and 10,000
    homeowners face foreclosure every single day. I am pleased to
    note that the new administration has taken a much more
    aggressive approach to dealing with the housing problem than
    did its predecessor, working to halt the spread of foreclosures
    and to provide opportunities for homeowners to refinance their
    mortgages and receive housing counseling.
        The importance of succeeding in these programs cannot be
    stressed enough. Like never before, we need an engaged,
    aggressive, and well-run Department of Housing and Urban
    Development with leadership that is confident in its mission
    and unafraid to act. As President Obama has himself said, HUD's
    role--and I quote him--``has never been more important.'' And
    while HUD has been mismanaged and riddled with scandal in
    recent years, there is an important time for new, bold
    leadership and a clear direction, and I believe that Secretary
    Donovan is already providing just that kind of leadership.
        So I would like to welcome Mr. Sims, Ron Sims, whom I have
    known for a long time, who is a former local official in the
    State of Washington, who is the nominee to be Deputy Secretary.
    He will be working closely with Secretary Donovan particularly
    on the day-to-day management of the agency. Currently the
    County Executive in King County, Washington, he comes with
    years of experience in public service and in working with urban
    policy and city planning. He also brings with him a passion for
    breaking down the barriers between housing, transportation, and
    environmental policies, and, more importantly, the results to
    show for it. I share his enthusiasm and I look forward to
    discussing how we can spur the kind of transit-oriented
    development that gets our economy moving again, reduces
    congestion, cuts transportation costs for working families, and
    creates the kind of safe and affordable shelter needed in our
    country.
        We also welcome the nominee for Chairman and President of
    the U.S. Export-Import Bank, Mr. Hochberg, whom I have known as
    well for many, many years. The Export-Import Bank is
    celebrating its 75th anniversary as the lead government agency
    financing U.S. exports. It was founded in 1934--in fact, at a
    time not unlike the one we are in today--and designed very
    specifically to create jobs here at home. And I have some very
    important questions for you, Mr. Hochberg, but the agency, in
    my view, has been failing in that responsibility at this time.
    It is not creating the kind of jobs. You have lending
    authority, you have insurance authority and guaranty authority,
    and neither of those areas are being fully complemented, in my
    view, at a time like this. So I have some very important
    issues, and you come at an important moment. Since this time,
    this agency has supported over $400 billion in U.S. exports and
    hundreds of thousands of good American jobs. In these tough
    economic times, we need a strong Export-Import Bank to increase
    our ability to make products that foreigners want, buy, and to
    develop and help our exporters secure the financing they need
    to sell those products. And with Mr. Hochberg's unique blend of
    leadership skills honed over 30 years in the private sector,
    government, philanthropy, and academia, I think the Export-
    Import Bank will have a leader who understands the impact that
    the financial crisis is having on financing of U.S. exports. So
    I know welcome our additional HUD nominees as well.
        Ms. Kanovsky will also have a critically important role in
    strengthening the agency's operations and programs as the
    nominee for General Counsel. Currently, she is the chief
    operating officer of the AFL-CIO Housing Investment Trust,
    where she has worked for the past 13 years. I have known her as
    well in her capacity in that job, and I congratulate you on
    being before us today.
        Mr. Stevens, who will serve as the Assistant Secretary of
    HUD for Housing and Federal Housing Commissioner, is President
    and COO of the Long & Foster Companies and comes with a deep
    understanding of the mortgage industry and is highly regarded
    and highly supported, I might say, in my own State of
    Connecticut. People involved in the housing area, in fact,
    specifically brought it up to Secretary Donovan when he was in
    my State 2 weeks ago for a day visiting people, and out of the
    audience people stood up and highly commended him for choosing
    you to do this job--not something you normally hear about
    nominees in the process, but there is a lot of excitement about
    you taking this job. I want you to know that as well.
        Mr. Kovar, who will serve as the Assistant Secretary of HUD
    for Congressional Affairs, has executive experience on Capitol
    Hill which includes as chief of staff to Congressman Barney
    Frank, the Chairman of the Financial Services Committee. So you
    bring a lot of experience and knowledge, and we welcome you as
    well.
        Mr. Trasvina, who will serve as Assistant Secretary of HUD
    overseeing fair housing and equal opportunity programs, has
    deep experience working on Capitol Hill and in immigration and
    civil rights policy. As we celebrate National Fair Housing
    Month, I am very pleased to welcome you here before the
    Committee.
        And, last, I would like to welcome the nominee for the
    Assistant Secretary of the Treasury for Terrorist Financing,
    Mr. Cohen. If confirmed, your work would impact our Nation's
    major security challenges, including nuclear proliferation,
    international terrorism, drugs and arms trafficking, and piracy
    on the high seas--a matter that we are all more than familiar
    with as a result of events of the last few weeks.
        Since its creation just 5 years ago, the Office of
    Terrorism and Financial Intelligence has played an invaluable
    role in protecting our national security. In fact, the 9/11
    Commission gave the U.S. Government its only A-minus in the
    category of combating terrorism financing. Yet much work still
    remains to be done using the tools this Committee has afforded
    Treasury in recent years, including legislation that I and
    Members of this Committee authored in 2007 to increase
    penalties against sanctions violators and the USA PATRIOT Act
    of 2001. TFI will continue to play an important part in denying
    funds that promote Iran's nuclear program, tracking activities
    of global terrorism and halting money laundering, and
    international domestic organized crime. Mr. Cohen will provide
    invaluable assistance to Under Secretary Levey and Secretary
    Geithner in managing this critical operation, bringing with him
    years of experience at both the Treasury and working with the
    law firm of Wilmer, Hale.
        Again, I welcome all of our nominees. It is an awful lot of
    you. Frankly, I would prefer to be dealing with you
    individually. That would be the way to do this. But, obviously,
    given the sense of urgency in getting people in place, it is
    something I think all of us can appreciate and support.
        I mentioned earlier supporting this President's nominees. I
    have been a member of the U.S. Senate for some 28 years. I can
    count on one hand the number of nominees that I have opposed
    over that time of Republican and Democratic administrations. I
    do not believe it is a time for people to inject the
    opposition, their ideological framework. Presidents' elections
    have meaning, and if a President gets elected, he or she
    deserves to have the teams in place to help them execute their
    policies and their promises to the American people. I do think
    we have an obligation to examine nominees on other matters
    affecting their capacity to serve. But my general view has been
    to support nominees when that occurs, and, again, I would
    prefer to have done this in a more deliberate fashion with each
    of you in front of us rather than having a panel of this size.
    But, again, given the exigencies of getting people in place,
    given the economic circumstances we are facing, it is what it
    is, and so I am conducting the hearing in this manner.
        What I would like to do--and, again, colleagues are here.
    Mr. Sims, you have both of our colleagues from the State of
    Washington here, and let me turn to them very quickly, and then
    the Chairman of the Financial Services Committee to make his
    introductions. And so I thank both of my colleagues, Senator
    Cantwell and Senator Murray, for being here.
        Yes, and Congressman Schiff. How are you, by the way?
    Welcome.
        Representative Schiff. Thank you.
        Chairman Dodd. Seeing all these Congressmen sitting at this
    Committee makes us nervous in the Senate, I want you to know
    that.
        [Laughter.]
        Chairman Dodd. I know the House members would like to have
    something akin to a term of office that did not coincide with
    Senate elections. I suspect that would pass overwhelmingly in
    the House and have a very difficult time in the Senate, I want
    you to know.
        Anyway, welcome. We are delighted to have you here.
        Representative Frank. Well, everything has a very difficult
    time in the Senate.
        Chairman Dodd. Everything has a very--I know. Having been a
    member of the other body, I can appreciate that point of view
    as well.
        To my colleague, Senator Murray, or whatever order you
    would like.

                       STATEMENT OF PATTY MURRAY
              A U.S. SENATOR FROM THE STATE OF WASHINGTON

        Senator Murray. Thank you very much, Mr. Chairman, and to
    all the Members of the Committee, and I am pleased to be here
    today with Senator Cantwell to introduce Ron Sims, who is our
    King County Executive, to this very important hearing. I know
    his wife, Cayan, could not be here, but he is accompanied by
    some family members--a brother-in-law and niece, I believe--and
    I know his family is very excited about this opportunity for
    him.
        I want to personally congratulate Ron on the honor of being
    President Obama's nominee to serve as the next Deputy Secretary
    of the Department of Housing and Urban Development. Ron and his
    family are no strangers to public service, and I want to thank
    them for once again answering the call at this pivotal time in
    our Nation's history.
        As Chairman of the Transportation, Housing, and Urban
    Development Appropriations Subcommittee, I know firsthand HUD's
    important mission--to support community development, increase
    access to affordable housing, and help house families in need.
    From those struggling families to our Nation's veterans, HUD's
    services often mean the difference between the despair on the
    streets and the safety and security of a home.
        But today HUD faces challenges as daunting as at any other
    time in the agency's nearly 45-year history as a Cabinet-level
    agency. Millions of Americans have lost their homes to
    foreclosure, and as unemployment continues to rise, millions
    more are at risk. I have been reassured by the dedication and
    leadership shown by Secretary Donovan over the past 3 months,
    but given the magnitude of this housing crisis, Secretary
    Donovan cannot do it alone. And that is why I am so pleased
    that the President has tapped Ron Sims to provide his
    leadership and experience as Deputy Secretary at HUD.
        Throughout his 12-year career as King County Executive, Ron
    Sims has been a strong leader for our State and the people of
    King County. He has always faced challenges head on and has
    always been open to consider new, innovative policies to
    improve the lives of the families in King County. He has been a
    true pioneer in housing policy, but I want to focus on three
    examples that illustrate his readiness to immediately step in
    and step up to tackle HUD's challenges.
        First of all, Ron knows that making progress requires
    partnerships. As King County Executive, Ron has worked to build
    strong, diverse community partnerships that address many of the
    housing needs in King County. These partnerships have helped
    leverage the resources of the county to create thousands of new
    affordable housing units and preserve and improve existing
    housing stock. Ron has helped to establish and currently serves
    as co-chair of the Committee to End Homelessness. That is a
    regional partnership that has helped add more than 3,000
    housing units for the homeless in King County.
        This experience is going to be critical at HUD, an agency
    that depends on partnerships with everyone, from the largest
    Cabinet agencies to the smallest community boards, to extend
    housing opportunities in communities across the Nation.
        Another central part of HUD's mission is the promise to
    provide housing to all those who need it, free from
    discrimination and prejudice. And as the people of King County
    well know, Ron Sims is an uncompromising champion of equal
    rights. In fact, he recently led an effort to establish the
    King County Equity and Social Justice Initiative that brings
    together community leaders to root out discrimination and
    improve access to education, health care, and affordable
    housing.
        And, finally, HUD will most certainly benefit from Ron's
    steadfast commitment to smart community development. When it
    comes to environmental protection, expanding transit, and
    managing growth, Ron has always been ahead of the curve. He has
    worked hard on initiatives to reduce the carbon footprint of
    King County, expand transit service, and has been a tireless
    advocate for smart growth management policies that have helped
    establish synergies across county programs and services.
        Mr. Chairman, Members of this Committee, this is a great
    time of challenges for HUD, but it is also a time of great
    opportunity. Today we have the chance to refocus the agency's
    efforts on meeting the needs of low-income families and to
    renew its commitment to be a lifeline for those in dire
    straits. Innovative ideas, strong leadership, and dedication to
    equality are what HUD needs to move in a new direction, and
    those are all skills that Ron Sims brings to the table.
        So I appreciate this opportunity to participate in this
    hearing, and I look forward to working with this Committee as
    it moves forward on this nomination.
        Chairman Dodd. Senator, thank you very much.
        Maria.

                      STATEMENT OF MARIA CANTWELL
              A U.S. SENATOR FROM THE STATE OF WASHINGTON

        Senator Cantwell. Thank you, Mr. Chairman, and thank you
    and Members of the Committee for holding this important
    hearing. I am pleased to be here with my colleague Senator
    Murray to help introduce King County Executive Ron Sims. I urge
    my colleagues to swiftly confirm him as the next Deputy
    Secretary of Housing and Urban Development.
        Ron Sims is just the person we need to work on the full
    spectrum of housing issues, from promoting homeownership to
    making sure we have adequate supply of affordable rental
    housing, to addressing the special needs of homeless neighbors.
        I have known Ron Sims for more than 20 years, and I know he
    really knows affordable housing from a hands-on perspective.
    And, more importantly, he knows how to manage effectively when
    resources are tight.
        In his 13 years as King County Executive, Ron has worked to
    reform government, to move past the status quo, to provide for
    our communities, and this is just what HUD needs now. As HUD's
    point person on housing assistance and affordable housing
    programs, he will be responsible for making sure that families
    in most need are well served.
        In 2003, I worked personally with Ron to prevent the
    closure of Branch Villa Health Care Center. The Branch Villa
    Health Care Center, now known as the Leon Sullivan Health Care
    Center, is a nursing home that provides services to King County
    seniors, most of whom are African American. When the property
    faced foreclosure by HUD, we did all that we could at the
    Federal and State level to work with the resources to make sure
    that this transfer of ownership to a nonprofit group was done
    so that the center's doors could remain open.
        This success was more than just protecting a facility. It
    was about protecting our community's seniors and striving to
    provide the best for our communities. This is just the example
    of how Ron Sims operates. He cares about the community and
    works collaboratively to solve problems. He understands HUD,
    and he understands housing issues.
        Ron will also bring his smart business-oriented approach to
    the Department. He will ensure that the limited resources are
    used efficiently to meet the agency's critical mission. As King
    County Executive, he was instrumental in maintaining a balanced
    budget and earning the country's highest available credit
    rating. In 2006, Ron was recognized as the Public Official of
    the Year by Government Magazine, and in 2008, they named him
    one of America's Most Innovative Leaders.
        Now he brings all that energy to HUD at a time when we need
    it most, so I am glad that President Obama has recognized Ron
    Sims' innovative spirit. And I know it is that kind of
    visionary leadership that we need alongside Secretary Donovan
    at this critical agency at this critical point. So I encourage
    my colleagues to support quickly his nomination.
        Thank you.
        Chairman Dodd. Senator Cantwell, thank you very much. I
    thank both of our Senators from Washington.
        Let me turn, if I can, to our visiting colleagues here from
    the other body. The Chairman of the Financial Services
    Committee, Barney, we are delighted to have you here this
    morning, and Congressman Schiff as well. I want to welcome you
    as well.
        Is that on, Barney, your microphone there?
        Representative Frank. No. OK.

                       STATEMENT OF BARNEY FRANK

         A U.S. REPRESENTATIVE FROM THE STATE OF MASSACHUSETTS

        Representative Frank. I really have appreciated the chance
    to work with you, Senator, and I think we have done a lot, and
    we will be able to do a lot more in what has been a very good
    relationship between our two committees.
        I will say I had a very sad moment yesterday. As I was
    leaving my office, I walked past the desk of Peter Kovar, who
    has been my chief of staff, and it was blank. And I learned
    that I was going to have to--I realized I was going to have to
    learn to live without him.
        He is enormously talented. Actually, he comes to this job
    with both substantive knowledge, having worked as my chief of
    staff for over 20 years, having had some experience in the
    Senate. He is fully familiar with the substantive matter that
    comes before this Committee, because members will know your
    chief of staff inevitably becomes fully involved in the work of
    the Committee. And particularly these past few years when I
    became the Ranking Member in 2003, my sole Committee assignment
    has been this Committee. So he knows a great deal about it. We
    do little on the side.
        I will say, Mr. Chairman, that if a question involving
    fishing should come up at HUD, he is an expert on that, because
    I represent New Bedford.
        [Laughter.]
        Representative Frank. But in terms of both the Treasury and
    HUD areas, he is extremely well equipped substantively, and in
    terms of--I know one of the things you are going to have to do
    obviously in the job of being Assistant Secretary for
    Congressional Affairs is to deal with members of Congress with
    all of their quirks and eccentricities and personal
    difficulties. And I should think the fact that he has been my
    chief of staff for 28 years would satisfy any doubts on that
    score, that he would be able to deal with----
        [Laughter.]
        Chairman Dodd. And that is just the House side you are
    talking about.
        Representative Frank. Yes, that is true.
        So I am delighted to have the chance, and I really
    appreciate the President's appointing him. I am delighted also
    to see these other members.
        Let me say that I have also known and worked with Mr.
    Hochberg in a variety of capacities, and I agree with you, we
    could get more out of the Export-Import Bank than we have had,
    and I look forward to working with you to see that that is
    done.
        But I comment the President on a great group of nominees,
    and obviously, we look forward to working with them as they
    take their place. And as I said, in Peter Kovar, if you told
    someone that he had to train for 20 years to be the Assistant
    Secretary of HUD for Congressional Relations, he would have
    done very much what Peter Kovar has done.
        Chairman Dodd. Thank you very much. And, by the way, we
    have a statement from Senator Kennedy regarding, Peter, your
    nomination as well, and I know Senator Kerry, in fact, is going
    to try and get over as well and be heard on your nomination,
    and I know Ms. Kanovsky's as well. We will put those in the
    record as well.
        Thank you very, very much.
        Senator Schumer, we will jump to you because you have a
    hearing to go to. Do you mind waiting a few minutes,
    Congressman Schiff?
        Representative Schiff. No.
        Chairman Dodd. Thank you.

                INTRODUCTION OF NOMINEE FRED P. HOCHBERG
                     BY SENATOR CHARLES E. SCHUMER

        Senator Schumer. Thank you. And first I want to say, before
    I introduce Fred Hochberg, who I am proud to introduce to my
    colleagues, Peter, Barney said it would be OK if we voted you
    down.
        [Laughter.]
        Representative Frank. So much for telling a Senator
    anything in confidence.
        [Laughter.]
        Senator Schumer. I told Barney that he usually gets his way
    with this Committee, but not this time.
        Anyway, it is my honor to introduce Fred Hochberg, a good
    friend of mine and of many of the Committee. Fred is an
    accomplished businessman and public servant, and I am just so
    delighted to support his nomination to head the Export-Import
    Bank. I have known Freddie for many, many years, and he is
    capable, dedicated, has a great business career, but always
    wants to be in public service. He really cares about making
    this country a better place.
        He is a great fit for the position because it is about
    creating and supporting American jobs. That is what the Export-
    Import Bank is all about. And he knows how to do it. He spent
    two decades of his career with the Lillian Vernon Corporation.
    This was founded by his mother. She was an immigrant who fled
    Nazi Germany. She founded it with $2,000 wedding gift money.
    Under Fred's leadership, the company was transformed from a
    small mail-order company to a wildly successful, publicly
    traded direct marketing corporation that employs more than
    1,000 people.
        From Lillian Vernon, Fred moved to found and serve as
    President of Heyday. That is an investment firm that manages
    real estate and venture capital. And then he came to Washington
    in 1994. He joined the Clinton administration as Deputy
    Administrator, and then Acting, of the SBA. As we all know,
    small businesses are the engines of growth here in our economy,
    and, again, his business experience, his small business
    governmental experience, as well as being dean of the Milano
    School at the New School gives him an academic background as
    well.
        He has always been involved in the community. He and his
    long-time partner, my friend Tom Healy, who I do not see here
    today--he is not here, Fred?
        Mr. Hochberg. He is in Africa--teaching.
        Senator Schumer. He is in Africa, OK, teaching. They are
    active in numerous philanthropic and civil rights groups, and I
    want to thank them for what they have done to improve the lives
    of so many New Yorkers.
        So it is clear to me that Fred possesses the
    entrepreneurial spirit, the sense of civic duty, and the
    chutzpah necessary----
        [Laughter.]
        Senator Schumer. You are not supposed to laugh. That is
    part of the English language these days.
        [Laughter.]
        Senator Schumer. ----to excel as head of the Export-Import
    Bank.
        So I want to thank you, Mr. Chairman, for the opportunity
    to speak, and I hope the Committee will approve Fred's
    nomination unanimously given his broad, wide, and deep
    credentials. And, Freddie, congratulations on the nomination.
        Chairman Dodd. Senator, thank you very much.
        Let me turn to Representative Schiff for Mr. Trasvina's
    nomination as well. Congressman, welcome.

                      STATEMENT OF ADAM B. SCHIFF
           A U.S. REPRESENTATIVE FROM THE STATE OF CALIFORNIA

        Representative Schiff. Thank you, Mr. Chairman. These are
    wonderful seats, but don't worry, I will not get too
    comfortable.
        Mr. Chairman, Ranking Member Shelby, and other Members of
    the Committee, I would like to introduce you to President
    Obama's nominee for Assistant Secretary of the Office of Fair
    Housing and Equal Opportunity, FHEO, a dedicated public
    servant, an accomplished lawyer, Mr. John Trasvina.
        A proud resident of Pasadena, California, John has spent
    his life fighting for justice, working passionately as an
    advocate for civil rights. He has intimate experience with the
    inner workings of the executive and legislative branches, which
    will serve him well in his new post.
        John worked on the Hill and made his mark in civil rights
    legislation as the General Counsel and Staff Director of the
    Senate Judiciary Subcommittee on the Constitution. His
    experience and expertise caught the eye of many around
    Washington, and in 1997, John was appointed by President
    Clinton and confirmed unanimously to head the Federal
    government's only office devoted solely to immigrant rights.
    There he worked to enforce antidiscrimination provisions of the
    Immigration Reform and Control Act. This experience will be
    particularly helpful at FHEO where he will oversee the
    implementation and enforcement of the Fair Housing Act and
    other civil rights laws.
        After his time in D.C., he made his way to the West Coast
    as President and General Counsel at the Mexican-American Legal
    Defense and Education Fund, or MALDEF. There John gained
    invaluable experience managing a large and diverse organization
    with five offices around the country, working closely with a
    diverse range of organizations, including corporations as well
    as nonprofits.
        I ask that you include a letter of support from the
    Pasadena Police Chief, Bernie Melekian, in the record.
        In Pasadena, John worked closely with the police department
    advising the police chief and the city council on education,
    issues involving the Hispanic community, city service. He is a
    leader in our region not only for the Latino community, but he
    has worked across all communities for the common good and was
    awarded the President's Award by the Pasadena NAACP in 2008.
        I strongly support John Trasvina's appointment as Assistant
    Secretary for the Office of Fair Housing and Equal Opportunity.
    He has the knowledge, experience, and expertise to succeed. He
    has a passion for protecting Americans from discrimination,
    preserving their civil rights, and I am convinced he will
    enforce the Fair Housing Act, the Civil Rights Act of 1964, and
    other measures under his jurisdiction justly, with great
    dedication and heart. His experience in the administration and
    here in Congress as well as his relationship with a diverse set
    of outside organizations prepares him well for the path ahead.
        John, we are tremendously proud of you, and we wish you
    every success, and I urge his favorable consideration.
        Thank you, Mr. Chairman.
        Chairman Dodd. Thank you, Congressman, very much. We
    appreciate your coming over and participating today as well.
    Very grateful to you for doing that.
        Senator Warner, you have got a nominee as well, and we want
    to see if you would like to spend a few minutes----

                INTRODUCTION OF NOMINEE DAVID H. STEVENS
                       BY SENATOR MARK R. WARNER

        Senator Warner. I appreciate that, Mr. Chairman, and let
    me, first of all, welcome the whole panel and say
    congratulations on your nominations and hopefully your speedy
    approvals.
        I am here to introduce a fellow Virginian, David Stevens,
    whom the President has nominated to be Assistant Secretary of
    Housing and FHA Commissioner. I know David is here with his
    wife, Mary, and I think he will present them as well.
        I was happy to hear that when you were up with Secretary
    Donovan in Connecticut that David's reputation has extended to
    the Nutmeg State in terms of people stepping forward. And I
    think that is because David brings a unique set of experiences
    to this new challenge. He has been President and Chief
    Operating Officer of the Long & Foster Companies, a
    multifaceted real estate firm located in Virginia, but it has
    holdings around the region and the country. He has served as
    Vice President at Wells Fargo Home Mortgage Division, where he
    has been obviously involved in issues intimately connected with
    the mortgage challenge. He has been Vice President of Single
    Family Housing at Freddie Mac and had a 16-year tenure at the
    World Savings Bank. He, in addition, brings, I think, as we
    particularly look at the challenges of restarting our housing
    industry at this point and making sure that we truly have a
    fair housing approach, he was a founding executive sponsor of
    the Women's Mortgage Industry Network, and during his tenure at
    Freddie Mac initiated some of the first outreach activities to
    the Latino community.
        So all of this broad background has clearly extended beyond
    the reaches of Virginia in terms of the interest in his
    nomination, and I am particularly anxious to have him come on
    board because, as I am sure you found with Secretary Donovan,
    we have a lot of new initiatives the President has outlined.
    But as homeowners try to get the next level of detail down so
    they can actually take advantage of some of these initiatives,
    we are still seeing some lag time from the Department to get
    these initiatives--the details out so that people can fully
    take advantage of them. And David--I know his speedy
    confirmation will help that process along.
        I would add a couple other quick individual notes. I have
    some trepidation seeing David again here today because, as he
    was considering this, David and Mary and I were having dinner
    one night at an event, and he shared the fact that he was
    considering this, and to leave the private sector where he was
    doing extraordinarily well to come back and take this
    challenge, again, in the public sector, he was weighing that. I
    am glad that you have weighed the decision and made the choice
    as a family to take on this challenge. Again, your services
    will be well needed and well regarded. So I welcome you. I
    welcome the rest of the panel.
        Two other quick items. One is let me add my voice to the
    introductions of at least two of the members who have been
    talked about, Fred Hochberg and Ron Sims. I know the whole
    panel is great, but I have had personal experience with both
    Fred and Ron, and I know they will be excellent additions to
    the President's team.
        And on a personal note--and I will get some grief for this
    later. I think when Adam came in, he brought his daughter. This
    is also ``Bring Your Daughter to Work Day.'' So I have my--she
    is going to cringe behind the chair back here.
        [Laughter.]
        Senator Warner. My youngest daughter, Eliza, who is a
    freshman in high school, attending today. I would only note
    that she was very excited about this opportunity to come
    because she thought she could miss school. She was really
    bummed out when she heard that I was starting with an 8 o'clock
    breakfast with Barney Frank and that we would have to leave
    even earlier than she normally goes to school. And I think you
    will see a lot of other kids and daughters particularly running
    around the Hill today.
        So thank you, Mr. Chairman. David, we welcome you and look
    forward to your confirmation.
        Chairman Dodd. Senator Warner, thank you very, very much.
        I mentioned earlier Senator Kerry wanted to be here. When
    he comes in, we will give him an opportunity, if he can, and
    the schedules are very tight, as I know you are aware on this,
    but certainly his comments on your behalf will be included in
    the record, at the very least. I thank my colleagues for doing
    this.
        I want to turn to my colleague, Senator Shelby, for any
    opening comments he may have, and then I am going to turn to my
    colleagues here for any comments they may have. I will swear in
    our witnesses.
        I want to thank in advance Senator Warner, who is going to
    take over the Chair for the nomination process so I can get to
    the floor. There is a debate going on on some matters that
    affect the jurisdiction of this Committee.
        Senator Warner. I had the opportunity to work with Senator
    Dodd as a young man and he promised great things. I didn't
    think after only 100 days here that I would get to sit in the
    chair, though, so I am----
        [Laughter.]
        Chairman Dodd. I am taking the gavel with me when I leave.
        [Laughter.]
        Chairman Dodd. Having known Mark for a long time, I might
    never get it back.
        [Laughter.]
        Chairman Dodd. Senator Shelby.

                 STATEMENT OF SENATOR RICHARD C. SHELBY

        Senator Shelby. I will be very quick. I am just here to
    support all of you. I think we have got some outstanding
    nominees. The sooner we move these nominees, Mr. Chairman, the
    better. From the Republican side, I think we want to get
    everybody in place and have the administration going full
    blast.
        Chairman Dodd. I thank you very much.
        Jack, do you have any comments?
        Senator Johanns, any comments you would like to make? You
    know what it is like to sit at that table, as well, having been
    a nominee.
        Senator Johanns. I do know what it is like.
        Chairman Dodd. You bring a special appreciation of sitting
    on both sides of this dais.

                   STATEMENT OF SENATOR MIKE JOHANNS

        Senator Johanns. I do. I will offer just a thought, because
    I don't think I can stay for the whole hearing, but I don't
    want to prolong this, Mr. Chairman.
        It was about 4 years ago that I sat where you sit. I was
    nominated to be the Secretary of Agriculture, kind of an
    intimidating experience. But I would say this. None of you have
    to be intimidated by this. You are enormously qualified to do
    this job. I can't imagine there will be any problems with your
    confirmation whatsoever, unless something were to pop up. But
    it looks great.
        [Laughter.]
        Chairman Dodd. There is always that ``if,'' that thought.
        Senator Johanns. I would offer a thought, though, because
    like I said, I probably do have to leave the hearing. I would
    just offer a word of advice in terms of taking on your new
    assignments, because I think you can look forward to that. I
    would urge you to work in a very bipartisan way. I quickly
    found out that it was not acceptable for me to go into a Senate
    office or a House office and explain to them that I inherited
    the problem. They wanted me to solve the problem. And if it was
    in their district, they really wanted me to solve the problem.
    They were not interested in excuses or explanations as to why I
    didn't cause the problem.
        The other thing I would say to you is no matter how good
    you are, and you are all enormously gifted and qualified, even
    in what you are doing now, you are going to leave problems
    behind for the next person. It is the nature of life. I am
    guessing, Mr. Sims, in King County, there are still homeless
    people. There is still inadequate housing. But you can't be
    blamed for that. What you can be held responsible for is good
    management and solid determination to get the job done. So I
    really encourage all of you to focus on that.
        Personally, I am anxious to work with all of you. These are
    important issues that you are working on, everything from
    terrorism to housing, my goodness, and everything in between.
    Look at us as a partner and my hope is that we can have a very,
    very solid good working relationship. Godspeed and good luck to
    all of you.
        Chairman Dodd. Thank you very much, Senator.
        Senator Johanns. Thank you, Mr. Chairman.
        Chairman Dodd. Senator Merkley, do you want to make a
    comment on this?

                   STATEMENT OF SENATOR JEFF MERKLEY

        Senator Merkley. Thank you very much, Mr. Chair. I wanted
    to come and thank all of you for making this commitment to
    public service. Housing is something that has been very much a
    part of my background as Director of Habitat for Humanity in
    Portland, Oregon, later a developer of affordable housing,
    later an advocate in the legislature for both strong rental
    assistance programs, decent housing, and for home ownership.
        I think that housing is the foundation of the American
    dream. It is often, in terms of home ownership, the foundation
    of families' financial success. There is a lot of work to be
    done and we are under difficult circumstances with the budget
    we face. Far more families will be seeking assistance, needing
    assistance, and we will be in more challenged national fiscal
    circumstances in terms of providing that assistance.
        So certainly my team, my staff team looks forward to
    working with you. I look forward to working with you, and
    Godspeed.
        Chairman Dodd. Senator, thank you very, very much.
        I want to note, by the way, Diane Farrell is in the
    audience and works with the Export-Import Bank and from
    Connecticut and was confirmed by this Committee earlier, so we
    welcome you to the Committee.
        And I want to recognize--there are an awful lot of people
    in the room and I suspect an awful lot of the various staffs
    from HUD, from Ex-Im Bank, and from Treasury, and not all of
    them ever get to sit at this dais and be confirmed for a post
    and get to make a statement. But the people who just do
    everyday work do a remarkable job on behalf of the citizenry of
    this country and never get enough recognition, in my view, for
    the tremendous hours and efforts they make.
        I forget to mention that from time to time, but I thought
    today recognizing that I know a lot of people from the various
    agencies are here in support of these nominees and to offer
    whatever assistance they can, and I am confident I speak for
    every one of us up here, how much we appreciate the work that
    gets done by civil servants in this country throughout our
    government who work hard, long after the regular hours every
    day to make this country function. We need you more than ever,
    obviously, at a time like this. So I want to thank all of you
    who are in the room who don't get to sit at this table and to
    be a nominee and be confirmed, but in a sense, all of us want
    to confirm every day how much we appreciate what you do.
        With that, I am going to ask our witnesses to rise and to
    raise your right hands and to take an oath, if you would,
    please.
        Do you swear or affirm that the testimony that you are
    about to give is the truth, the whole truth, and nothing but
    the truth, so help you God?
        Mr. Sims. I do.
        Mr. Hochberg. I do.
        Ms. Kanovsky. I do.
        Mr. Stevens. I do.
        Mr. Kovar. I do.
        Mr. Trasvina. I do.
        Mr. Cohen. I do.
        Chairman Dodd. And do you agree to appear and testify
    before any duly constituted committee of the U.S. Senate?
        Mr. Sims. I do.
        Mr. Hochberg. I do.
        Ms. Kanovsky. I do.
        Mr. Stevens. I do.
        Mr. Kovar. I do.
        Mr. Trasvina. I do.
        Mr. Cohen. I do.
        Chairman Dodd. I thank you very much.
        With that, we will begin. Mr. Sims, Ron Sims, we will begin
    in the order that you are at the table here and I am going to
    ask all of you to try and keep your remarks relatively brief,
    if you can. Any supporting data and information you think would
    be helpful for this Committee to have in support of your
    nomination will be certainly--I will accept at this point so
    you don't have to just send it to us.
        There may be a period of a few days after your testimony
    here to respond to some questions from Members who, for
    whatever reason, couldn't be here but would like to raise some
    issues, and I would urge you to respond to those questions as
    quickly as you possibly can so we can move your nominations
    forward. We will leave the record open for that purpose.
        With that, Mr. Sims, we welcome you, and I welcome all of,
    again, the members of the panel.

         STATEMENT OF RONALD SIMS, OF WASHINGTON, TO BE DEPUTY
         SECRETARY, DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

        Mr. Sims. Thank you, Mr. Chairman, Senator Shelby, and
    distinguished Members of the Committee. I am honored and
    humbled on the occasion of President Obama and Secretary
    Donovan to nominate me as Deputy Secretary for Housing and
    Urban Development. I want to thank the Committee for making
    time in your busy schedules to provide this opportunity for us
    to share our thoughts and views regarding housing and urban
    development at this critical time in this country.
        For over 12 years, I have been proud to serve as the
    elected executive of the Nation's 14th largest county, managing
    an annual budget of $5 billion and a workforce of 14,000
    employees, delivering local and regional services to 1.8
    million people. Throughout my career, I have championed
    regional efforts to develop affordable and supporting housing,
    end homelessness, improve blighted neighborhoods, and create
    opportunities for home ownership. But I have also balanced
    those priorities with the need to reduce congestion, improve
    mobility, protect our environment, and address the inequities
    and injustices in our region.
        President Obama and Secretary Donovan and Congress have all
    voiced a clear expectation that HUD can and must now step up to
    the unprecedented levels of leadership in America's national
    recovery.
        Chairman Dodd. Is your microphone on?
        Mr. Sims. The roles facing HUD today include stabilizing
    the housing market, alleviating homelessness, creating healthy
    housing stock and vibrant and sustainable urban and rural
    communities. To do this, HUD must take a collaborative approach
    and work to leverage Federal action with other agencies,
    including Transportation, Treasury, Energy, Health and Human
    Services, as well as the Environmental Protection Agency. This
    interagency leadership will only be possible if HUD as an
    organization is fully functional and focused on meaningful and
    measurable outcomes.
        I am ready for the challenge put before me by President
    Obama and Secretary Donovan to bring transformational change to
    HUD. I believe my management experience in King County and our
    standing as a world class regional government can serve as a
    relevant model for HUD. It has not always been easy, but with
    many large organizations, dramatic reforms in areas like
    information technology and human resources is sorely needed.
    And by creating a cross-disciplinary team orientation and
    providing managers with effective tools and support, we have
    worked together to set King County on the right course.
        More recently, King County has institutionalized a system
    of data-driven management that brings evidence to
    decisionmakers when they need it most. We have published these
    results through an award-winning report that underscores our
    commitment to accountability and to transparency.
        And we have looked beyond the silos of our government
    organization to help us in achieving these results. At King
    County, we have built strategic partnerships similar to the
    national network of partners Secretary Donovan outlined in his
    confirmation testimony. I believe deeply in the power of this
    vision, working with a range of local governments, housing
    authorities, foundations, nonprofits, and private developers
    who would join HUD in implementing its priorities.
        Like our departments in King County, HUD's organization
    must work and it must serve not simply as a pass-fail
    bureaucracy. It must be a creative engine of ideas, actions,
    and tools in which employees, partners, and our customers are
    all empowered to implement a shared vision of the future.
        In sum, we must be ready with a smoothly running
    organization at all levels, from local to Federal leaders, to
    take on the challenges before us. HUD must be accountable,
    transparent, and effective as a major agent of oversight for
    TARP and a primary decisionmaker in how recovery funds will be
    spent. We must ease the foreclosure crisis and lay the
    foundation of home ownership, affordability, and stability. And
    we must chart a course for sustainable communities' visions,
    one in which our urban and rural areas are more vibrant,
    sustainable, and resilient.
        Mr. Chairman, Senator Shelby, and Members of this
    distinguished Committee, thank you again for the opportunity to
    speak to you today. I firmly believe that under Secretary
    Donovan's leadership and with ongoing input from Congress, we
    can transform HUD into a catalyst for economic opportunity and
    ensuring every American a decent, safe, and suitable living
    environment.
        I would also wish to acknowledge, if you will let me, the
    incredible work being done by Senator Murray and Senator
    Cantwell. They are extraordinary public officials. They do
    great work in our community and our State and they are icons.
    But they serve at a national level, as well. So we appreciate
    all they are as Senators.
        I would be remiss if I didn't thank my niece from
    Bellingham, Washington, for being here today, and my brother-
    in-law from College Park, Maryland, for being here today. The
    rest of the family is back in Seattle.
        I look forward to being able to serve this Nation. Thank
    you, Mr. Chairman.
        Senator Warner [presiding]. Thank you, Mr. Sims. We look
    forward to your service. You have got quite a record at the
    local level and I know we can bring that to bear here at the
    national level.
        Mr. Hochberg.

    STATEMENT OF FRED P. HOCHBERG, OF NEW YORK, TO BE PRESIDENT AND
                      CHAIRMAN, EXPORT-IMPORT BANK

        Mr. Hochberg. Thank you. I would like to just introduce my
    brother, David Hochberg, a few rows back, and as Senator
    Schumer mentioned, my mother is out of the country, and my
    partner, Tom Healy, is teaching a course in Africa, so I wanted
    to acknowledge them.
        I want to also thank Senator Schumer for his very generous
    introduction and thank you, Senator Warner, and also Barney
    Frank for your comments.
        Chairman Dodd, Senator Shelby, Members of the Committee, I
    am honored to appear before you today to testify regarding my
    nomination to be President and Chairman of the Export-Import
    Bank of the United States. I am grateful to President Obama for
    the trust he has placed in me and I want to thank the Committee
    for the prompt scheduling of this hearing.
        I bring 30 years' experience in business, government,
    international affairs, and education. If confirmed, I will
    immediately begin working on the challenges facing Ex-Im Bank
    in particular, and most importantly the U.S. economy in
    general.
        In preparing for this hearing, I have been able to develop
    an initial understanding of Ex-Im Bank's policies and
    procedures. It is very clear that Ex-Im Bank's mandate is to
    protect and sustain U.S. jobs. The Bank does this by helping
    U.S. exporters meet foreign competition and stepping in when
    commercial financing is not available for otherwise viable
    transactions. The Bank keeps a watchful eye on taxpayer money
    by acting only when it can find a reasonable assurance of
    repayment.
        Mr. Chairman, I do not have to tell any Member of this
    Committee that these are not ordinary times, but Ex-Im Bank is
    at its best in times such as these. Why do I feel this way? Ex-
    Im Bank, established 75 years ago by President Roosevelt during
    the Great Depression, has the capacity to step up now as it did
    then. The Bank played an integral role in the implementation of
    the Marshall Plan. It also helped our country meet the Latin
    American and Asian debt crises of the 1980s and 1990s.
        Past is prologue. I believe Ex-Im Bank needs to do more and
    can do more in the months and years ahead. First, total Bank
    business has already shown a significant increase, in the range
    of 20 percent over last year. As Secretary Geithner said
    yesterday, our country's economic recovery depends on reversing
    the steep decline in exports. Moreover, for the first time in
    its history, the Bank has authorized over $1 billion for the
    support of small businesses in the first 6 months of this year.
        Second, I had an opportunity to meet with a number of Ex-Im
    Bank career employees and I have come away impressed, impressed
    with their dedication, with their expertise, and impressed with
    their competence.
        Third, my time as Deputy and Acting Administrator of the
    Small Business Administration, Dean of Milano the New School
    for Management and Urban Policy, as well as my experience as a
    Commissioner on the Port Authority for New York and New Jersey
    has prepared me for this challenge.
        But I am also prepared because of my experience in the
    private sector and my personal life. I come to this position as
    a businessman. I have run a business founded by my mother, who
    came to this country at age ten as a refugee from Nazi Germany.
    That business, Lillian Vernon, grew from our kitchen table into
    a public company with thousands of employees doing business
    around the world. I know firsthand what it takes to make a
    small, family owned enterprise succeed and how difficult that
    can be. And I also know firsthand that our economy relies on
    entrepreneurs for innovation and growth, and I want to help
    them succeed in any way the Bank can.
        If confirmed, I fully commit to actively searching for new
    policy initiatives and solutions to problems in order to move
    the Bank forward, streamlining our services, eliminating
    bottlenecks, and providing top-notch customer service to all
    our constituents, be they American exporters or the banks that
    support them. I will do this by consulting with our
    stakeholders in labor, exporting, and banking, working closely
    with our colleagues in the administration, strengthening our
    support for small businesses and environmentally sound exports,
    and of course keeping in close contact with this Committee and
    the rest of Congress as we navigate through these difficult
    times.
        Ex-Im Bank is the right agency at the right place at the
    right time.
        In closing, I ask for your support for my nomination. Thank
    you. I would be happy to answer your questions.
        Senator Reed. Mr. Chairman?
        Senator Warner. Senator Reed.

                     STATEMENT OF SENATOR JACK REED

        Senator Reed. Mr. Chairman, I think we have a vote
    impending shortly and I am going to have to depart. But I
    particularly want to welcome all the witnesses, but a special
    hello to Fred Hochberg for his great community service over
    many, many years. Peter Kovar and I had the occasion to work in
    the House. We both worked for Barney Frank, so we both have a
    wonderful wealth of experience to go forward. And I have had
    occasion to individually meet with some of the nominees. This
    is a very distinguished group of individuals and I wish you
    well. You are headed to difficult challenges which you will all
    face. Thank you, Mr. Chairman.
        Senator Warner. Thank you, Senator Reed, and thank you,
    Fred, for your comments. I know we all will have some questions
    for the record. I do think you are taking on a very important
    challenge with an institution that has got a number of
    challenges in front of it, some allegations in that have been
    lodged against it that you will need to address, as well as
    some abilities, particularly on the lending side, to do some
    things in support of small business that we hope you will
    explore.
        I know and I appreciate that this is all of your special
    day and many of you have brought family and others. We are
    going to have a vote about 11:45. That means that I can
    probably stay for about another 10 minutes after that, but
    about 5 minutes of 12, I turn into a pumpkin, as well. So I
    would request, if possible, at least in terms of getting all
    the opening statements out, that if you could try to reduce
    your statements to 2 to 3 minutes apiece, that would be very
    helpful.
        Ms. Kanovsky.

      STATEMENT OF HELEN R. KANOVSKY, OF MARYLAND, TO BE GENERAL
          COUNSEL, DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

        Ms. Kanovsky. OK, and I will also speak fast. Mr. Chairman
    and distinguished Members of the Committee, thank you for
    considering my nomination and for the opportunity to appear
    before you today.
        With me today is my daughter, Emily Dorfman, and my brother
    and sister-in-law, Martin Kanovsky and Ellen Teller, as well as
    their daughter, my niece, Allison Kanovsky. My daughter,
    Jennifer Dorfman, is an emergency room doctor in Pittsburgh and
    had to be there saving lives today.
        I am honored to have been nominated by President Obama to
    be the General Counsel of the Department of Housing and Urban
    Development. I also want to thank Secretary Donovan for asking
    me to serve as General Counsel to the Department. Secretary
    Donovan is an extraordinary public servant and an extraordinary
    man and I will be thrilled to have the opportunity to advise
    him and his team.
        I am particularly honored to appear before you here in the
    Senate Banking, Housing, and Urban Affairs Committee hearing
    room where my interest in housing began a little more than 35
    years ago. There were a number of interesting hearings
    occurring the summer of 1973. That was the beginning of the
    Watergate hearings. But there were also hearings before this
    Committee. There was no C-SPAN, no CNN, and for good or ill,
    there were no televisions in the Senate offices. If a Senator
    wanted to know what was going on on the floor or in a committee
    hearing and could not be there personally, the Senator sent a
    staffer. I was the most junior member for the Senator 100th in
    seniority and a member at that time of this Committee, Joseph
    Biden of Delaware.
        Chairman Proxmire held a hearing on manufactured housing,
    mobile homes, and I still remember the film the committee
    showed showing people's homes blowing away. I went back to
    Senator Biden's office, and as only a 21-year-old can, told him
    the government needed to do something. Now, 35 years later,
    there is a stronger storm, a financial tsunami that threatens
    not just our housing finance system, but our entire economy.
    Again, the government needs to act, and I hope to be part of
    that government.
        I went from Senator Biden's staff to the Harvard Law
    School, and after a short time in private practice I went to
    HUD as Special Assistant to Secretary Patricia Roberts Harris.
    I then went with her to the Department of Health, Education,
    and Welfare, which became the Department of Health and Human
    Services.
        After a stint in the private practice of law, I went to
    Skyline Financial Services, which was created by the United
    States Bankruptcy Court to do a $1.5 billion workout that was
    the precursor to the savings and loan collapse nationwide. We
    dealt with a $1.5 billion loss and we thought that that was
    significant, and we had only 20,000 properties to dispose of.
    We successfully wound down the inventory of houses and
    concluded the bankruptcy. We positioned ourselves to do
    business with the Resolution Trust Corporation, and at that
    point, GE Capital bought the business and that is exactly what
    we did.
        With that work completed, I left GE Capital and joined the
    AFL-CIO Housing Investment Trust in 1995 as General Counsel. I
    also began a long association with the National Housing
    Conference, of which I currently serve as Chair. In 1998 to
    1999, I was here as Senator John Kerry's Chief of Staff when he
    served on this Committee and as Ranking Minority Member of the
    Housing Subcommittee. I returned to the Housing Investment
    Trust in 1999, where I served in various capacities, where I am
    currently Chief Operating Officer and General Counsel.
        I am proud of my many years at the HIT. The Trust is a
    registered investment company and operates pursuant to the
    rules and regulations of the Securities and Exchange
    Commission. We deploy our $3.4 billion in investment in
    housing. We do not employ leverage and we have never invested
    in subprime single-family loans. Last year, our gross return
    was 5.68 percent, and we are a conservative fund pursuing
    competitive returns for our investors, good union jobs in the
    construction industry, housing and economic development in
    communities across the Nation. Only government service would
    entice me to leave.
        I am a lawyer, a manager, a policy wonk, and a believer
    that now, more than ever, housing is where policy, regulation,
    financial institutions, capital markets, profit and nonprofit
    developers, builders, and workers join to provide not
    necessarily a house, but a home for every American family.
        We celebrate this year the 60th anniversary of the Housing
    Act of 1949. That Act set a goal of, quote, ``a decent home and
    suitable living environment for every American.'' The Senators
    and Representatives who wrote that language meant it. The
    housing crisis, the foreclosure crisis are enormous challenges
    to that goal, but they bring us to a new focus on housing and
    public policy and provide a forum to once more enunciate the
    goal and commit to its achievement.
        It would be an honor and a privilege to serve as General
    Counsel of the Department of Housing and Urban Development. Mr.
    Chairman, I want to thank you and the Committee once again for
    this opportunity to appear before you and I am prepared to
    answer any questions you may have.
        Senator Warner. Thank you, Ms. Kanovsky.
        Mr. Stevens.

      STATEMENT OF DAVID H. STEVENS, OF VIRGINIA, TO BE ASSISTANT
    SECRETARY FOR HOUSING-FEDERAL HOUSING COMMISSIONER, DEPARTMENT
                    OF HOUSING AND URBAN DEVELOPMENT

        Mr. Stevens. Thank you, Senator Warner. Thank you for your
    kind introduction. I am honored to be here today and humbled by
    President Obama and Secretary Donovan's decision to nominate me
    as Assistant Secretary of Housing-FHA Commissioner for the
    Department of Housing and Urban Development, and I also
    appreciate you scheduling this hearing so quickly after the
    recess.
        Before I begin, I just want to quickly introduce my wife,
    Mary, my daughters, Sara, Alison, Maggie, and my son, Taylor,
    who have joined me here today. Take your child to work day.
        For the past 26 years, I have dedicated my career to the
    business of helping support and working in the housing finance
    industry. My career has taken me from working directly with
    home buyers for a savings and loan association in the early
    1980s to managing a nationwide loan operation. I have held an
    executive leadership role in the secondary market as Senior
    Vice President at Freddie Mac, working with virtually every
    financial institution in the mortgage industry, mortgage
    insurance firms, technology providers, Wall Street and industry
    trade organizations. I have managed the wholesale mortgage
    banking business as Executive Vice President for Wells Fargo.
    And I am currently the President of the Nation's largest
    privately held real estate company.
        FHA has become critical to the stabilization and recovery
    of the housing market. The recent surge in loan activity
    clearly highlights FHA's importance as a primary vehicle to
    strengthen housing. But the pressure of this growth has clearly
    stressed the system.
        If confirmed, I will work tirelessly to make sure that we
    protect FHA and enhance its risk management capabilities to
    proactively protect its future viability. Immediately, my top
    three priorities would be as follows. First, we must ensure the
    solvency of the fund and ensure that FHA does not require
    taxpayer assistance. This can be done by balancing FHA's public
    purpose with prudent credit risk management. This starts with a
    thorough review of credit parameters of the FHA program and to
    identify program features that are higher risk and could cause
    adverse impacts to the fund.
        Additionally, lender management must be enhanced to ensure
    accountability for performance. Focusing on lenders with poor
    performance and removing them from the system is job one to
    protect the fund. Finally, system investments must be made in
    order to improve both automated underwriting quality as well as
    data integrity.
        Second, we need to make sure that FHA does everything to
    support the President's programs and the administration's
    programs that have already been enacted.
        Third, we need to restore FHA to a much more respected
    position of leadership in the marketplace. The overall effort
    to modernize the core technology systems must be combined with
    enhancing FHA's best practices, possessing and utilizing fraud
    detection tools that work, finding more effective solutions to
    mitigate losses and market disruptions in the future when
    adverse conditions occur again, and focusing on long-term
    solutions to make FHA a positive force in protecting the future
    of the Nation's housing.
        As a real estate executive, I have witnessed firsthand the
    importance and value of the FHA program. After the private
    label mortgage market collapsed in 2007, I can assure you that
    the Nation's economic problems would be significantly more
    worse today if it had not been--if FHA had not been there to
    fill the void in the Nation's housing system. FHA has fulfilled
    its public purpose by helping hundreds of thousands of families
    finance their homes with lower rates and better terms. The
    challenge now is to balance actuarial soundness and effective
    risk management, and if confirmed, I will be committed to
    ensuring FHA's financial stability going forward.
        Thank you very much for your time.
        Senator Warner. Thank you, Mr. Stevens, and thank you for
    taking the plunge.
        [Laughter.]
        Mr. Kovar.

        STATEMENT OF PETER KOVAR, OF MARYLAND, TO BE ASSISTANT
      SECRETARY FOR CONGRESSIONAL AND INTERGOVERNMENTAL AFFAIRS,
              DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

        Mr. Kovar. Thank you. I appreciate that, and thank Senator
    Dodd and the other Senators on the Committee for giving me the
    chance to testify here. As a Congressional staffer for more
    than 25 years, I have often been in the back or back here and
    it is a different experience and one that I really appreciate
    having a chance to sit at the table instead.
        I do want to just introduce my wife, Paula, sitting behind
    me here, and my daughter, Sarah, and my son, Paul. It is great
    to have them here. And I want to thank Congressman Frank, who
    had to leave, for that nice introduction. I guess Senator Kerry
    and also Kennedy put in written statements. As a Massachusetts
    native, having their expressions of support really is something
    I will appreciate for a long time.
        I do want to say that I hope the Committee will confirm me,
    and if I am confirmed, I anticipate building strong
    relationships not only with Senators on the Committee here, but
    with all their colleagues throughout Congress to advance the
    important housing goals that have been articulated by President
    Obama and also Secretary Donovan.
        As someone who became involved in politics out of a desire
    to assist people who are less well-off or economically
    disadvantaged, it is really a great opportunity to be in line
    for a position at a department which focuses on that set of
    issues. In the short-term, there are three key initiatives that
    the Department is going to be working on, and on all of them, I
    think my role as the Assistant Secretary for Congressional
    Relations will be to ensure that we communicate fully with
    Congress and also that we interpret the information that you
    are providing back on how the administration is doing.
        The first thing, of course, is the response to the
    foreclosure crisis. I think the Members of the Committee are
    aware of the various components of that and in particular the
    efforts to both allow refinancing and also allow those who are
    having trouble paying their mortgages to modify them. But it is
    essential going forward that we provide on an ongoing basis
    information on how that is proceeding, so I will be doing that.
        The second one is the Recovery Act. With over $13 billion
    in key HUD initiatives, like promoting energy efficiency and
    creating green jobs, unlocking the credit markets, and also
    making funding available for shovel-ready projects, it is going
    to be essential for Congress to really be aware of how that is
    proceeding and to be informed when grants are issued, et
    cetera.
        Third, the details of the budget have not yet been
    released, but that is probably going to happen in about 2
    weeks. But the Secretary has announced that key components of
    the budget will include additional steps to help those who wish
    to purchase or refinance homes, promotion of affordable rental
    housing, curtailing mortgage fraud and predatory lending,
    expansion of green development, and increased funding for
    vouchers, and also programs like CDBG, that are so helpful to
    low-income people and low-income areas. HUD is going to on all
    of those have to undertake a major outreach effort to Congress,
    and again, I view that as a central element of my future job.
        The Secretary mentioned in his confirmation hearing that
    Congress often hasn't received the information and data it
    needs to properly evaluate HUD's work, and he indicated that he
    would place a high priority on developing systems in order to
    meet those needs. So this is something that I will be committed
    to, and this goes beyond the three issues that I just
    mentioned. We will be working on ensuring that the Gulf Coast
    States that are still suffering from the effects of the
    hurricane are helped. That will also be something on which we
    will have to provide metrics to ensure that we know how we are
    doing. And that is also true when we are looking at, for
    example, trying to preserve multi-family housing. And, there is
    the urban development component of HUD's mission, too, which
    sometimes isn't mentioned, that we want to make sure we do
    well.
        In Congressman Frank's office, our top priority is serving
    the 600,000 constituents that we represent, and responsiveness
    is what we strive for when we do that. I pledge to continue to
    do that if I am confirmed.
        I noticed that Senator Schumer mentioned that Congressman
    Frank said it would be OK if they didn't approve me, and as a
    loyal staffer, I am not accustomed to disagreeing with my boss
    in public, but maybe in this case I will make an exception.
        [Laughter.]
        Mr. Kovar. So I do hope that the Committee will confirm me
    and everybody else here. Thank you for the opportunity.
        Senator Warner. Thank you, Mr. Kovar.
        Mr. Trasvina.

     STATEMENT OF JOHN D. TRASVINA, OF CALIFORNIA, TO BE ASSISTANT
                  SECRETARY FOR FAIR HOUSING AND EQUAL
        OPPORTUNITY, DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

        Mr. Trasvina. Thank you, Senator Warner. It is a high honor
    to be nominated by President Obama to be Assistant Secretary
    for Fair Housing and Equal Opportunity. I am gratified by the
    assistance of this Committee in considering my nomination today
    during Fair Housing Month and for your favorable consideration
    to the full Senate. I am particularly appreciative of
    Congressman Schiff's kind words from Pasadena.
        In America, civil rights begins at home. As Americans, we
    are proud of the progress we have made in civil rights,
    progress made possible by the energies and insights of Members
    of this Committee and your predecessors dating back 41 years to
    the Fair Housing Act of 1968, progress made possible by the
    brave appeals to our true core principles as a Nation of
    fairness, by countless individuals and institutions from the
    South, North, rural, metropolitan, and urban America, from
    coast to coast to coast.
        The vital importance of carrying out the principles of fair
    housing for our communities remains today, and I bring to the
    post of Assistant Secretary a career of civil rights
    leadership, Federal government and institutional management,
    and dedication to bringing communities together.
        The principles of fair housing probably have the greatest
    impact on our Nation's children. If left ignored, the pain and
    shame of a parent whose family is denied an apartment or home
    because of race, national origin, or disability is felt by a
    child for a lifetime. But when fair housing violations are
    effectively addressed, and better yet, discrimination is
    prevented, we can provide a lifetime of recognition and
    understanding of the protection of the Constitution and our
    laws and the responsiveness of civil servants. Moreover, where
    one lives shapes opportunities for an equal education,
    preparation for the workplace, access to transportation,
    culture, and myriad other elements of our daily life.
        So today, as the Obama administration and Congress work
    together to provide stability to home ownership, the Office of
    Fair Housing and Equal Opportunity must play a meaningful role.
    When I was Senator Simon's counsel on the Constitution
    Subcommittee, I was honored to play a staff role in the passage
    of the Fair Housing Act Amendments of 1988 and speak to
    disability organizations about the extension of protections of
    the law.
        As Special Counsel for Immigration-Related Unfair
    Employment Practices at the Department of Justice from 1997 to
    2001, I led the Federal government's only office devoted solely
    to immigrant workplace rights. There, we were successful in
    widespread education to employers and legally authorized
    workers about their rights and responsibilities under the
    immigration and employment laws. I am proud of the
    accomplishments of the career attorneys and legal staff in
    obtaining bank paper discrimination victims, fining employers
    to remedy violations, and ensuring that the office was
    responsive to all stakeholders.
        I would apply these same principles to the Office of Fair
    Housing and Equal Opportunity to ensure that our partners,
    whether they are the Department of Justice, outstanding local
    civil rights agencies, among public interest fair housing
    advocates, interest associations, or organizations in the
    housing and lending industries can carry out their work in
    furtherance of the Fair Housing Act.
        We have many weapons available to us to eradicate housing
    bias from our society. All must be used in a coordinated
    fashion to be effective.
        I am grateful to the President for nominating me, giving me
    the opportunity to serve the Nation in this capacity.
    Similarly, I am highly appreciative of your consideration and
    consent to my nomination. Thank you.
        Senator Warner. Thank you, Mr. Trasvina.
        Mr. Cohen.

       STATEMENT OF DAVID S. COHEN, OF MARYLAND, TO BE ASSISTANT
     SECRETARY FOR TERRORIST FINANCING, DEPARTMENT OF THE TREASURY

        Mr. Cohen. Thank you, Senator Warner. I will be very brief.
        Chairman Dodd, Ranking Member Shelby, and distinguished
    Members of the Committee, thank you for the opportunity to
    testify here today. It is truly an honor to be the nominee to
    serve as Assistant Secretary of the Treasury for Terrorist
    Financing. I want to thank President Obama for the confidence
    he has shown in me by nominating me, and Secretary Geithner for
    recommending me, to serve in this position.
        I would like first to introduce my wonderful wife, Suzy,
    and our two outstanding sons, Sam and Zeke, who are here today.
    I am also very happy that my parents, Jordan and Carole Cohen,
    are here today. I know that this occasion fills them all with
    pride.
        As I sit before this Committee, I am keenly aware of the
    very significant responsibilities assigned to the Assistant
    Secretary for Terrorist Financing. As set out in the statute
    creating the position, the Assistant Secretary, working under
    the direction of the Under Secretary for Terrorism and
    Financial Intelligence, is, ``responsible for formulating and
    coordinating the counterterrorist financing and antimoney
    laundering efforts of the Department of the Treasury.'' These
    efforts are critically important in maintaining the integrity
    of our financial system, combatting illicit finance at home and
    abroad, and advancing the foreign policy and national security
    objectives of our great Nation.
        The variety and intensity of the challenges in this arena
    are, of course, ever-changing, and if confirmed, I very much
    look forward to working on these challenges with the
    outstanding professionals who make up the Office of Terrorist
    Financing and Financial Crimes at the Department of the
    Treasury. I also intend to work closely with you, Mr. Chairman,
    the other Members of this Committee, and your staff to pursue
    our shared objective of protecting our national security and
    the integrity of our financial system.
        Mr. Chairman, I would ask that my entire statement be
    entered into the record of this hearing. I would be happy to
    answer any questions that you may have.
        Senator Warner. Thank you, Mr. Cohen.
        Let me thank all of the witnesses here and make clear what
    Mr. Cohen said, that all of your full statements will be
    submitted for the record.
        Let me also add that a number of us have questions that we
    will submit, as well, and we will have to get those answers
    back before your confirmation process is completed.
        I would simply come back to Mr. Hochberg, and Chairman Dodd
    had asked me to raise this, and I share his concerns, that
    there have been recent concerns about an Inspector General
    report about Export-Import Bank having upwards of between $100
    and $300 million of fraud over the last few years. We will look
    very carefully at your comments on that subject.
        Let me also--and I apologize, the vote is now going--the
    fact that the other Members are not here is not a reflection of
    anything other than the scheduling constraints of the Senate.
        Let me thank you all in advance for your service, and let
    me also thank the family members who are here. I know this was
    your dad's or wife's or husband's big day, and we thank you for
    your service, as well. As somebody who has been in public
    service for some time, it is truly a family affair. Our country
    will be better served by your participation and we look forward
    to your speedy and rapid confirmation.
        With that, I say the Committee stands adjourned. Thank you.
        [Whereupon, at 11:53 a.m., the hearing was adjourned.]
        [Prepared statements, response to written questions, and
    additional material supplied for the record follow:]

                       PREPARED STATEMENT OF RONALD SIMS
                            To Be Deputy Secretary,
                  Department of Housing and Urban Development
                                 April 23, 2009
        Thank you Mr. Chairman, Senator Shelby, and distinguished Members
    of the Committee.
        I am honored and humbled by the decision of President Obama and
    Secretary Donovan to nominate me as Deputy Secretary of Housing and
    Urban Development. I want to thank the Committee for making time in
    your busy schedules to provide this opportunity for us to share our
    thoughts and views regarding housing and urban development at this
    critical time in our country.
        For over 12 years, I have been proud to serve as the elected
    Executive of the Nation's 14th largest county, managing an annual
    budget of $5 billion and a workforce of 14,000 employees, delivering
    local and regional services to 1.8 million people.
        Throughout my career, I have championed regional efforts to develop
    affordable and supportive housing, end homelessness, improve blighted
    neighborhoods and create opportunities for home ownership. But I've
    also balanced those priorities with the need to reduce congestion,
    improve mobility, protect our environment, and address inequities and
    injustices in our region.
        President Obama, Secretary Donovan, and Congress have all voiced a
    clear expectation that HUD can and must now step up to unprecedented
    levels of leadership in America's national recovery.
        The roles facing HUD today include stabilizing the housing market,
    alleviating homelessness, creating healthy housing stock and vibrant
    and sustainable urban and rural communities. To do this, HUD must take
    a collaborative approach and work to leverage Federal action in other
    agencies including Transportation, Treasury, Energy, and Health and
    Human Services as well as the Environmental Protection Agency.
        This interagency leadership will only be possible if HUD as an
    organization is fully functional and focused on meaningful and
    measurable outcomes.
        I am ready for the challenge put before me by President Obama and
    Secretary Donovan to bring transformational change to HUD. I believe
    that my management experience in King County, and our standing as a
    world-class regional government can serve as a relevant model for HUD.
        It has not always been easy, but with many large organizations
    dramatic reform in areas like information technology and human
    resources, is sorely needed. And by creating a cross-disciplinary team
    orientation, and providing managers with effective tools and support,
    we have worked together to set King County on the right course.
        More recently, King County has institutionalized a system of data-
    driven management that brings evidence to decision makers when they
    need it most. We have published these results through an award-winning
    report that underscores our commitment to accountability and
    transparency.
        And, we have looked beyond the silos of our government organization
    to help us in achieving results. At King County, we have built
    strategic partnerships, similar to the ``national network of partners''
    Secretary Donovan outlined in his confirmation testimony. I believe
    deeply in the power of this vision--working with a range of local
    governments, housing authorities, foundations, nonprofits, and private
    developers, who will join HUD in implementing its priorities.
        Like our departments in King County, HUD's organization must work--
    and it must serve not simply as a pass-fail bureaucracy. It must be a
    creative engine of ideas, actions, and tools--in which employees,
    partners, and our customers are all empowered to implement a shared
    vision of the future.
        In sum, we must be ready with a smoothly running organization at
    all levels--from local to Federal leaders--to take on the challenges
    that are before us. HUD must be accountable, transparent, and effective
    as a major agent of oversight for TARP, and a primary decision maker in
    how Recovery Act funds will be spent. We must ease the foreclosure
    crisis and lay the foundation for homeownership affordability and
    stability. And we must chart a course for a new Sustainable Communities
    vision--one in which our urban and rural areas are more vibrant,
    sustainable, and resilient.
        Mr. Chairman, Senator Shelby, and Members of the Committee, thank
    you again for the opportunity to speak with you today. I firmly believe
    that under Secretary Donovan's leadership, and with ongoing input from
    Congress, we can transform HUD into a catalyst for economic opportunity
    and ensuring every American a decent, safe, and suitable living
    environment.

                     PREPARED STATEMENT OF FRED P. HOCHBERG
                         To Be President and Chairman,
                               Export-Import Bank
                                 April 23, 2009
        Chairman Dodd, Senator Shelby, Members of the Committee: I am
    honored to appear before you today to testify regarding my nomination
    to be President and Chairman of the Export-Import Bank of the United
    States. I am grateful to President Obama for the trust he has placed in
    me, and I want to thank the Committee for its prompt scheduling of this
    hearing. If confirmed, I will bring my 30 years of experience in the
    private sector, government, international affairs, and education to
    immediately begin working on the challenges facing Ex-Im Bank in
    particular and the U.S. economy in general.
        In preparing for this hearing, I have been able to develop an
    initial understanding of Ex-Im Bank policies and procedures. It is very
    clear Ex-Im Bank's mandate is to protect and sustain U.S. jobs. The
    Bank does this by meeting foreign competition from other export credit
    agencies, and stepping in when commercial financing is not available
    for otherwise viable transactions. The Bank keeps a watchful eye on
    taxpayer money by acting where it can find a ``reasonable assurance of
    repayment.''
        Mr. Chairman, I do not have to tell any Member of this Committee
    that these are not ordinary times. But the history of the Bank has
    shown that it is frequently at its best in times such as these. It was
    established 75 years ago by Franklin Roosevelt during the Great
    Depression. It played an integral role in the implementation of the
    Marshall Plan. It helped our country to meet the Latin American and
    Asian debt crises of the 1980s and 1990s.
        The past is prologue. I believe Ex-Im Bank can do even more in the
    months and years ahead. First, total Bank business is showing a
    significant increase, in the range of twenty per cent. As Secretary
    Geithner said yesterday, our country's economic recovery depends on
    reversing the decline in exports. Moreover, for the first time in its
    history the Bank has authorized over $1 billion for the support of
    small businesses in the first 6 months of the fiscal year.
        Second, I have had the opportunity to meet with several Ex-Im Bank
    career staff, and I have come away impressed with their dedication,
    expertise, and competence. Third, with my background, including Deputy
    and Acting Administrator of the Small Business Administration, Dean of
    Milano the New School for Management and Urban Policy, as well as
    experience as a Commissioner on the Port Authority of New York and New
    Jersey, I am prepared for this challenge.
        But I am also prepared because of my experience in the private
    sector and my personal life. I come to this position as a businessman.
    I have run a business founded by my mother, who came to this country at
    age 10 as a refugee from Nazi Germany. That business, Lillian Vernon,
    grew from our kitchen table into a public company, doing business
    around the world. I know first-hand what it takes to make a small,
    family owned enterprise succeed, and how difficult that can be. But I
    also know first hand that our economy relies on entrepreneurs for
    innovation and growth, and I want to provide them with all the tools of
    success Ex-Im Bank has to offer.
        If confirmed, I fully commit to:

        Actively search for new policy initiatives and solutions to
            problems, in order to move the Bank forward;

        Streamling our services and eliminating bottlenecks; and

        Providing top-notch customer service to all our
            constituents, be they American exporters or the banks that
            support them.

        I will do this by:

        Consulting with our constituents in exporting, banking, and
            labor;

        Working closely with our colleagues in the administration,

        Strengthening our support for small businesses and
            environmentally sound exports; and of course

        Keeping in close contact with this Committee and the rest
            of Congress as we navigate through these troubled times.

        Ex-Im Bank is the right agency in the right place for these times.
        In closing, I ask for your support for my nomination. Thank you. I
    will be happy to answer your questions.

                    PREPARED STATEMENT OF HELEN R. KANOVSKY
                             To Be General Counsel,
                  Department of Housing and Urban Development
                                 April 23, 2009
        Mr. Chairman and distinguished Members of the Committee, thank you
    for considering my nomination and for the opportunity to appear before
    you today.
        I am honored to have been nominated by President Obama to be the
    General Counsel of The Department of Housing and Urban Development. I
    also want to thank Secretary Shaun Donovan for asking me to serve as
    General Counsel to the Department of Housing and Urban Development.
    Secretary Donovan is an extraordinary public servant and an
    extraordinary man. I would be thrilled to have the opportunity to
    advise him and his team.
        I am particularly honored to appear before you here in the Senate
    Banking and Housing Committee Hearing Room where my interest in Housing
    began a little more than 35 years ago. There were a number of
    interesting Hearings occurring the summer of 1973. There was no C-Span,
    no CNN, and, for good or ill, there were no televisions in the Senate
    offices. If a Senator wanted to know what was going on on the floor or
    at a Committee Hearing and could not be there personally, the Senator
    sent a staffer. I was the most junior staff member for the Senator
    100th in Seniority and a Member of this Committee, Joseph Biden of
    Delaware. Chairman Proxmire held a Hearing on manufactured housing--
    mobile homes--and I still remember the film the Committee viewed
    showing people's homes blowing away in a storm. I went back to the
    Dirksen Building and told Senator Biden that the government needed to
    do something.
        Now 35 years later there is a stronger storm, a financial tsunami
    that threatens not just our housing finance system but our entire
    economy. Again the government needs to act. I hope to be a part of that
    government.
        I went from Senator Biden's staff to the Harvard Law School and
    after a short time in private practice I went to HUD as a special
    assistant to Secretary Patricia Roberts Harris and then I went with her
    to the Department of Health, Education and Welfare, which became the
    Department of Health and Human Services. After a stint in the private
    practice of law, in 1986 I went to work for Skyline Financial Services
    Corp, which was created by the U.S. Bankruptcy Court in Alexandria,
    Virginia, to workout the EPIC bankruptcy, part of the Maryland Savings
    and Loan collapse and a precursor to the Savings and Loan collapse
    nationwide. We were dealing with $1.5 billion in defaulted loans and
    20,000 properties nationwide. And we thought we had a big problem!
        We successfully wound down the inventory of homes and concluded the
    workout. In doing so we created an asset management company superbly
    situated to purchase and manage properties from the Resolution Trust
    Corporation. In 1990, GE Capital bought Skyline and created just such a
    company, of which I was the General Counsel. With much of that work
    completed, I left GE Capital Asset Management and joined the AFL-CIO
    Housing Investment Trust in 1995, as General Counsel there. I also
    began a long association with the National Housing Conference, of which
    I am currently honored to serve as Chair.
        In 1998-99 I was here as Senator John Kerry's Chief of Staff when
    he served on this Committee and as Ranking Minority Member of the
    Housing Subcommittee. I returned to the HIT in 1999 where I served in
    various capacities, currently Chief Operating Officer and General
    Counsel. I am proud of my many years at the HIT. The Trust is a
    registered investment company and operates pursuant to the rules and
    regulations of the Securities and Exchange Commission. We deploy our
    $3.4 billion in investments in housing. We do not employ leverage and
    we have never invested in subprime single family loans. Last year our
    gross return was 5.68 percent; 5.25 net to our investors. We are a
    conservative fund pursuing competitive returns for our investors, good
    union jobs in the construction industry, and economic development in
    communities across the Nation. Only government service would entice me
    to leave.
        I am a lawyer, a manager, a policy wonk, and a believer that more
    now than ever housing is where policy, regulation, financial
    institutions, capital markets, profit and nonprofit developers,
    builders, and workers join to provide not necessarily a house, but home
    for every American family. We celebrate this year the 60th Anniversary
    of the Housing Act of 1949. That Act set the goal of ``A decent home
    and a suitable living environment for every American Family.''
        The Senators and Representatives who wrote that language meant it.
    The housing crisis, the foreclosure crisis are enormous challenges to
    that goal, but they bring us to a new focus on housing and public
    policy and provide a forum to once more enunciate the goal and commit
    to its achievement. It would be an honor and a privilege to serve as
    General Counsel of the Department of Housing and Urban Development.
        Mr. Chairman, I want to thank you and the Committee once again for
    this opportunity to appear before you and I am prepared to answer any
    questions you may have.

                     PREPARED STATEMENT OF DAVID H. STEVENS
      To Be Assistant Secretary for Housing-Federal Housing Commissioner,
                  Department of Housing and Urban Development
                                 April 23, 2009
        I am honored to be here today and humbled by President Obama and
    Secretary Donovan's decision to nominate me as Assistant Secretary of
    Housing-FHA commissioner for the Department of Housing and Urban
    Development. This agency plays a critical role as it partners with so
    many in the Nation right now to overcome one of the greatest economic
    crises that we have faced in decades. I would also like to thank this
    Committee for scheduling this hearing so quickly after the recess as I
    am sure you all have extremely busy schedules and I appreciate the time
    you are committing to meet with me and share your thoughts and views
    regarding housing issues and particularly those facing FHA.
        Before I begin, please let me take a moment to introduce my wife of
    almost 25 years, Mary, my daughters Sara, a recent graduate from
    Virginia Tech, Alison, a 2nd year student at the University of
    Virginia, and Maggie, a freshman at Oakton High School, and my son
    Taylor, a senior at Oakton High School and a future freshman at the
    University of Colorado.
        For the past 26 years, I have dedicated my career to the business
    of helping support and working in the housing finance industry. My
    career has taken me from working directly with homebuyers for a savings
    and loan association during the early 1980s, to managing a nationwide
    loan operation. I have held an executive leadership role in the
    secondary market, as Senior Vice President at Freddie Mac, working with
    virtually every financial institution in the mortgage industry;
    mortgage insurance firms, technology providers, Wall Street and other
    third party providers, and industry trade organizations. Finally I have
    managed the wholesale mortgage banking business for one of the Nation's
    largest banks and am currently the President of the Nation's largest
    privately held real estate company.
        In virtually every position, I have gained critical knowledge of
    this housing industry and through these positions I have gained the
    most thorough and intimate understanding of the housing finance system
    from the point of sale through the ultimate distribution in the capital
    markets. If confirmed by this body, I would look forward to applying
    this experience and knowledge to help ensure that FHA addresses the
    critical issues facing it today and help work with you and others to
    build a long term framework that will protect the future of the housing
    finance market.
        While FHA's role has always been an important one, FHA has now
    become absolutely critical to the stabilization and recovery of the
    housing market. Today FHA accounts for almost a third of all mortgages
    created in this country, up from representing only 3 percent of the
    lending market at the end of 2006. This enormous surge in loan activity
    clearly highlights FHA's importance as a primary vehicle to restore
    stability to the housing market. At the same time, this pace of growth
    over such a short period of time has created pressure on FHA's
    operational environment, which is in need of both system enhancements
    and process changes to protect the quality of the program for the long
    term.
        FHA has not been immune to the adverse conditions of this market.
    Default rates and foreclosures exceed prior estimates. Unlike subprime
    mortgages, however, where these loans were built on unsafe features
    with high-risk credit characteristics, FHA losses are more the result
    of economic factors such as job loss. And while I would not expect
    losses like those in the subprime market, the impacts of loans
    originated in 2007 and 2008 with high loan-to-value ratios, combined
    with seller funded down payment assistance programs and, in some cases
    questionable lender behaviors, could cause some stress on the program
    in the months going forward.
        If confirmed, I will work tirelessly to make sure that we take this
    great program and enhance its risk management capabilities and
    proactively protect its future viability. Immediately, my top three
    priorities would be as follows:
        First, we must ensure the solvency of the fund and ensure that FHA
    does not require any taxpayer assistance. This can be done by balancing
    FHA's public purpose with prudent credit risk management. The effort
    here needs to start with a thorough review of the credit parameters of
    the FHA program and to identify characteristics of the program that are
    higher risk and could cause adverse impacts to the fund. Tightening
    guidelines on higher risk products would be the primary output of this
    effort. Additionally lender management must be enhanced to insure
    accountability for performance. Focusing on lenders with poor
    performance and removing them from the system is job one to protect
    newly insured business. Finally, system investments must be made to
    improve both automated underwriting quality as well as data integrity
    in order to manage incoming loan quality as well as existing insured
    business.
        Second, we will ensure HUD's Housing programs adequately support
    the implementation of the President's housing priorities--specifically,
    the Homeowner Affordability and Stability Plan and an updated Hope for
    Homeowners program.
        And, third, we need to restore FHA to a more respected position of
    leadership in the marketplace. The overall effort to modernize the core
    technology systems must be combined with enhancing FHA's best
    practices, possessing and utilizing fraud detection tools that work,
    finding more effective solutions to mitigate losses and market
    disruptions in future periods of adverse economic conditions, and
    focusing on longer term solutions like energy efficient mortgage
    products that will make FHA a proactive positive force in protecting
    the future strength of the Nation's housing system.
        FHA is creating a strong leadership team. Carol Galante, as Deputy
    Assistant Secretary for Multifamily Housing, brings enormous experience
    and leadership in her field. The ability to have stronger leadership at
    all levels of FHA, with practical business knowledge, will be of
    significant value to all as we face the current challenges and look to
    the future.
        As a real estate executive, I have witnessed firsthand, the
    importance and value of the FHA program. After the private label
    mortgage market collapsed in 2007, I can assure you that the Nation's
    economic problems would be even worse today if FHA had not been there
    to fill the void in our Nation's housing system. FHA has fulfilled its
    public purpose by helping hundreds of thousands of families either
    purchase a home or refinance their existing mortgage with lower
    interest rates and better terms for the homeowners. The challenge now
    is to ensure that this value is balanced with actuarial soundness and
    effective risk management. If confirmed, I will be committed to
    ensuring FHA's financial stability going forward. Thank you again for
    your time and interest today. I appreciate the opportunity to be here
    and, if I am honored with your confirmation, I look forward to working
    with you in the future.

                       PREPARED STATEMENT OF PETER KOVAR
       To Be Assistant Secretary for Congressional and Intergovernmental
                                    Affairs,
                  Department of Housing and Urban Development
                                 April 23, 2009
        I would like to thank Chairman Dodd, Ranking Member Shelby, and the
    other Members of the Committee for giving me this opportunity to
    testify. As a Congressional staffer for over 25 years, I have often sat
    in the audience or behind the lawmakers in hearings, and it is an honor
    to sit today for the first time at the witness table.
        It is also an honor to be nominated by President Obama for the
    position of HUD Assistant Secretary for Congressional and
    Intergovernmental Relations. There are many people who have contributed
    to my being here, including numerous colleagues and friends who have
    offered encouragement. But, the most important has been my family, and
    I would like to acknowledge their presence here today and express my
    appreciation for their constant support: my wife Paula, my daughter
    Sarah, and my son Paul.
        I am grateful for those warm expressions of support from Senator
    Kerry and Congressman Frank. They are two members of Congress for whom
    I have great admiration, and it is a genuine professional and personal
    pleasure for me to be the beneficiary of their generous remarks. I am
    proud to have served on Senator Kerry's staff when he was first
    elected, and I have of course had the privilege of working in
    Congressman Frank's office for more than 25 years. If confirmed, I hope
    to match the example they have set for commitment to responsive
    government, public service and respect for Congress. And, as a
    Massachusetts native, having that thoughtful endorsement of my
    nomination by Senator Kennedy--a true hero in both my home State and in
    Washington--is something I will always treasure.
        If I am confirmed, I anticipate building strong relationships not
    only with Senators on this Committee, but with their colleagues
    throughout Congress, to advance the important housing goals that have
    been articulated by President Obama and Secretary Donovan. As someone
    who became involved in government largely out of a desire to provide
    help to those who are economically disadvantaged, I am pleased to be in
    line for a senior position in an agency with a primary mission along
    those lines.
        In the short term, the three key issue areas on which HUD will be
    focused are responding to the foreclosure crisis, implementation of the
    Recovery Act, and the 2010 budget. If confirmed, I will ensure that the
    sharing of information with Congress about all three initiatives on an
    ongoing basis is a top priority.
        As the Committee is aware, the Administration's response to the
    foreclosure problem includes working to reduce interest rates, helping
    4-5 million homeowners who can't take advantage of the current low
    rates to refinance, and providing funding to assist another 3-4 million
    homeowners in modifying their mortgages to avoid foreclosure. These
    efforts are still in their early stages, and it will be essential to
    provide periodic reports to Congress, as recommended by Senator Dodd
    during Secretary Donovan's confirmation hearing, so Congress will have
    a clear idea of the program's effectiveness.
        With the Recovery Act devoting over $13 billion to key HUD
    initiatives such as promoting energy efficiency and creating green
    jobs; unlocking the credit markets; making funding available for
    shovel-ready projects; and mitigating the effects of the economic
    crisis, it is crucial that Congress receives timely notification as
    grants under the various programs are made. More broadly, it will be
    vital to make sure that there is ready access to information about how
    the funds are being expended.
        While the details of the budget have not been released, the
    Secretary has announced that key components will include additional
    steps to help those who wish to purchase or refinance homes; promotion
    of affordable rental housing; curtailing mortgage fraud and predatory
    lending; expansion of green development; and increased funding for
    vouchers and programs like community development block grants that
    assist low income families and areas. HUD will undertake a major
    outreach effort to inform Congress about all of these programs when the
    budget is formally released.
        On all of these efforts, the watch words will be transparency and
    accountability. The Secretary mentioned in his confirmation hearing
    that Congress often hasn't received the information and data it needs
    to properly evaluate HUD's work, and he indicated that he would place a
    high priority on developing systems aimed at meeting those needs. If
    confirmed, I will play an important part in disseminating that
    information to Congress. And, I expect this commitment to information
    sharing to go beyond the three initiatives mentioned above. So, as we
    work on addressing the continuing needs of the Gulf Coast States
    affected by damaging hurricanes, preserving federally supporting multi-
    family housing, or creating innovative programs in the ``Urban
    Development'' component of HUD's mission, I look forward to making sure
    Congress is as well informed as possible about the department's
    activities.
        In Congressman Frank's office, our top priority is serving the
    660,000 constituents we represent. As Chief of Staff, a central element
    of my job is making sure that the staff maintains a commitment to
    responsiveness in everything we do. If confirmed, I will be committed
    to ensuring that my staff and I are as responsive and accessible as
    possible to the Members of this Committee and to the full Senate and
    House.
        Our emphasis on communication with Congress will include not only
    sufficient advance notice of key initiatives, but thoughtful answers to
    Congressional correspondence, and of course appropriate notification of
    grants and local announcements. A key element of these efforts will be
    coordinating with HUD field offices to ensure that Congressional
    inquiries are appropriately handled. In addition, I plan to institute a
    program of ``listening sessions'' in which senior HUD staff would be
    available periodically for open, nonagenda meetings with key Hill staff
    and, if they wish, Senators and Representatives.
        President Obama and Secretary Donovan have outlined an ambitious
    agenda for HUD. While Congress and the Administration will not always
    agree, there are many policies on which effective collaboration is
    possible. And, I expect a hallmark of my office to be fairness toward
    all Senators and Representatives, regardless of party, and a
    determination to seek bipartisan solutions when possible.
        In closing I wanted to take a moment to touch on the key role
    played by my parents. As career public servants involved in nonprofit
    social service agencies, State government, and numerous local groups
    and causes, they instilled in me the value of community service, and I
    have followed their lead for much of my life. For the last quarter
    century Congress has, in a sense, been my community. As I move toward
    another community in the Obama Administration, I am confident that my
    enduring connection to the Hill will help me to be successful in my new
    position, and I am hopeful the Committee will support my nomination.
        Thank you again, Mr. Chairman, for the opportunity to testify. I
    would be pleased to answer any questions.

                     PREPARED STATEMENT OF JOHN D. TRASVINA
       To Be Assistant Secretary for Fair Housing and Equal Opportunity,
                  Department of Housing and Urban Development
                                 April 23, 2009
        Mr. Chairman and Members of the Committee: Thank you for the
    opportunity to come before you today with my prospective colleagues
    seeking to serve the Nation at the United States Department of Housing
    and Urban Development. It is a high honor to be nominated by President
    Obama to be Assistant Secretary of Fair Housing and Equal Opportunity
    and I am gratified by the assistance of this Committee in considering
    my nomination today during Fair Housing month and for your favorable
    recommendation to the full Senate.
        In America, civil rights begin at home. As Americans, we are proud
    of the progress we have made in civil rights--progress made possible by
    the energies and insights of Members of this Committee and your
    predecessors dating back 41 years ago to 1968 and the enactment of the
    Fair Housing Act and prior to that time. And progress made possible by
    the brave appeals to our true core principles as a Nation of fairness
    by countless individuals and institutions in communities from South to
    North, urban, metropolitan and rural from coast to coast to coast. The
    vital importance of carrying out the principles of fair housing for our
    communities remains today and I bring to the post of Assistant
    Secretary a career of civil rights leadership, Federal government and
    institutional management, and dedication to bring communities together.
        The principles of fair housing probably have the greatest impact on
    our Nation's children. If left ignored, the pain and shame of a parent
    whose family is denied an apartment or home because of race or national
    origin is felt by a child for a lifetime. But when fair housing is
    effectively addressed and, better yet, discrimination is prevented, we
    can provide a lifetime of recognition and understanding of the
    protection of the Constitution and our laws and the responsiveness of
    civil servants. Moreover, where one lives shapes opportunities for an
    equal education, preparation for the workplace, and access to
    transportation, culture, and myriad other elements of our daily life.
    Today, as the Obama Administration and Congress work together to
    provide stability to homeownership, the Office of Fair Housing and
    Equal Opportunity plays a meaningful role.
        From my own experience in San Francisco, I learned from an early
    age about the ugly denials of a home to accomplished African American
    men who could pay their way but were denied simply because of racism
    and the color of their skin. My mother would point out the house on
    Cedro Way that belonged to Cecil Poole, our United States Attorney,
    where burned crosses were found to intimidate his family. And a little
    farther away on Miraloma Way, it took our Republican Mayor George
    Christopher to intervene with a homeowner who refused to sell his home
    to San Francisco Giants star Willie Mays because he was black. These
    overt acts of discrimination have subsided and today our community has
    moved from almost all white to almost all black to heavily Chinese,
    Vietnamese, and immigrant.
        When I worked for the late Senator Paul Simon as his counsel at the
    Senate Judiciary Committee's Subcommittee on the Constitution, I was
    honored to play a staff role in the passage of the Fair Housing Act
    amendments of 1988 and speak to disability organizations about the
    application and extension of the law's important protections. As
    Special Counsel for Immigration Related Unfair Employment Practices at
    the U.S. Department of Justice from 1997 to 2001, I led the Federal
    government's only office devoted solely to immigrant workplace rights.
    There, we were successful in widespread education to employers and
    legally authorized workers about their rights and responsibilities
    under the immigration and employment laws. I am proud of the
    accomplishments of the career attorneys and legal staff in obtaining
    back pay for discrimination victims, fining employers to remedy
    violations, and ensuring that the Office was responsive to all
    stakeholders. Our work knew no party. During the 3 years I served as
    Special Counsel in a Democratic Administration, we built the foundation
    for strong performance that carried over into a Republican
    Administration in which we brought the largest lawsuit ever under our
    enforcement statute.
        I would apply these principles to the Office of Fair Housing and
    Equal Opportunity to ensure that our partners, whether they are at the
    Department of Justice, at State and local civil rights agencies, among
    public interest fair housing advocates, industry associations, or
    organizations in the housing and lending industries, can carry out
    their work in furtherance of the Fair Housing Act. In addition, I offer
    my commitment of cooperation and communication on your ideas and the
    Administration's on further steps to advance fair housing and equal
    opportunity.
        We have many weapons available to us to eradicate housing bias from
    our society. All must be used in a coordinated fashion to be effective.
    The mission goes beyond access to an apartment or house to the lending
    decisions and the ability to remain in one's home. If confirmed, I will
    work vigorously to guard against scams that prey upon people's race or
    ethnicity to thwart their well-laid plans for homeownership or block
    access to assistance for the same reasons.
        Again, I am grateful to President Obama for nominating me to be
    Assistant Secretary for Fair Housing and Equal Opportunity and giving
    me the opportunity to serve the Nation in this capacity. Similarly, I
    am highly appreciative of your consideration and consent to my
    nomination.

                      PREPARED STATEMENT OF DAVID S. COHEN
               To Be Assistant Secretary for Terrorist Financing,
                           Department of the Treasury
                                 April 23, 2009
        Chairman Dodd, Ranking Member Shelby, and distinguished Members of
    this Committee: Thank you for the opportunity to appear before you
    today. It is truly an honor to be the nominee to serve as Assistant
    Secretary of the Treasury for Terrorist Financing. I want to thank
    President Obama for the confidence he has shown in me by nominating me,
    and Secretary Geithner for recommending me, to serve in this position.
        With your indulgence, I would first like to introduce my wonderful
    wife, Suzy, and our sons, Sam and Zeke. I am also very happy that my
    parents, Jordan and Carole Cohen, are here today. I know that this
    occasion fills them all with pride.
        As I sit before this Committee, I am keenly aware of the very
    significant responsibilities assigned to the Assistant Secretary for
    Terrorist Financing. As set out in the statute creating the position,
    the Assistant Secretary, working under the direction of the Under
    Secretary for Terrorism and Financial Intelligence, is ``responsible
    for formulating and coordinating the counterterrorist financing and
    antimoney laundering efforts of the Department of the Treasury.'' These
    efforts are critically important in maintaining the integrity of our
    financial system, combating illicit finance at home and abroad, and
    advancing the foreign policy and national security objectives of our
    great Nation. Having worked on antimoney laundering policy during my
    tenure several years ago in the General Counsel's Office of the
    Treasury Department, and having counseled many clients in my private
    law practice on their obligations to comply with Treasury's antimoney
    laundering and economic sanctions laws and regulations, I believe I am
    well prepared to undertake this responsibility.
        The variety and intensity of the challenges in this arena are, of
    course, ever-changing. Here at home, we need to continue the work of
    refining our antimoney laundering and counterterrorist financing
    regulatory regime, sensitive always to the need to carefully balance
    the burden that these rules impose on our citizens and our financial
    institutions against the value of the information obtained for law
    enforcement and counterterrorism purposes. If confirmed, I expect to
    work closely with the Congress, and my colleagues within the Treasury
    Department, in these efforts.
        Internationally, as the Obama Administration engages with
    governments around the world and confronts those who would do us harm,
    the many tools that the Treasury Department can deploy--including
    targeted financial measures focused on particular individuals and
    entities--will continue to play an integral role in our strategies for
    responding to the many challenges that lie ahead. To take just one
    example, in his recent address on nuclear nonproliferation in Prague,
    President Obama declared that ``we must ensure that terrorists never
    acquire a nuclear weapon,'' and made clear that we must ``use financial
    tools to disrupt'' their efforts to do so. Treasury's capacity to
    analyze financial intelligence, and to act on that intelligence by
    targeting the financial networks of terrorists, proliferators, and
    their supporters, will no doubt be employed as we undertake to meet
    this challenge. If confirmed, I pledge to dedicate myself to this
    mission, and, more broadly, to the use of all of Treasury's tools to
    advance our Nation's foreign policy and national security objectives.
        If confirmed, I very much look forward to working with the
    outstanding professionals who make up the Office of Terrorist Financing
    and Financial Crimes at the Department of the Treasury. I have deep
    respect for the knowledge, dedication and effectiveness of these
    professionals, led by Deputy Assistant Secretary Daniel Glaser. And I
    have great respect--both professionally and personally--for Under
    Secretary Stuart Levey, whom I have known well for almost 20 years, and
    who so ably leads the overall effort in the Office of Terrorism and
    Financial Intelligence.
        In closing, I want to thank the Committee for the attention it has
    given to my nomination. If confirmed, I intend to work closely with
    you, Mr. Chairman, the other Members of this Committee, and your staff
    to pursue our shared objective of protecting our national security and
    the integrity of the financial system. I have enormous respect for this
    institution, and I am deeply committed to maintaining the very
    productive and close relationship that exists between this Committee
    and the Office that I have been nominated to lead.
        Mr. Chairman, I would be pleased to respond to any questions that
    you or Members of the Committee may have.

             RESPONSE TO WRITTEN QUESTIONS OF SENATOR DODD
                            FROM RONALD SIMS

    Q.1. HUD Management--Mr. Sims, as I said in my opening
    statement, if you are confirmed as General Deputy Secretary,
    you will be confronted with an enormous number of management
    challenges--from outdated accounting and information systems to
    a workforce nearing retirement. Traditionally, the person in
    your position has day-to-day responsibility for departmental
    management.
        What do you see as your primary management challenges at
    HUD and what are your priorities?

    A.1. Dramatic reform in information technology and human
    resources is sorely needed at HUD. HUD must be a creative
    engine of ideas, actions, and tools--in which employees,
    partners, and our customers are empowered to implement a shared
    vision of the future.

    Q.2. How do you balance the need to work with the public with
    the need to address the challenges that HUD confronts?

    A.2. Transparency in government is conducive to both better
    serving the public's needs as well as enhancing HUD's internal
    management efficiencies. Transparency in government service
    should not be a mere phrase, but rather a transformational
    process by which both HUD's public support functions and
    internal management efficiencies will be improved.

    Q.3.How can you coordinate various functions at HUD to make
    sure they work together?

    A.3. As I stated in my earlier confirmation testimony, my
    experience in King County as County Executive, taught me the
    value of, and the need for, cross-disciplinary teams and
    solutions. As every manager or businessman or businesswoman
    knows, resources are always finite. Coordinating efforts from
    an enterprise-wide perspective which is inclusive of our non-
    Federal partners, allows one to take advantage of certain
    economics-of-scale and collaboration synergies. Too often in
    government we manage by cylinders. That needs to change at HUD;
    that will change at HUD.

    Q.4. DOT--We are currently facing many challenges: a deep
    recession, a housing crisis, a crumbling infrastructure,
    worsening metropolitan traffic congestion, global climate
    change, a growing and aging population, and a dangerous
    dependence on foreign oil. While these challenges are clearly
    connected, Federal policy dealing with each of these elements
    is too often developed in isolation. As you know, in February I
    sent a letter to President Obama encouraging him to create a
    White House Office of Sustainable Development to better
    coordinate housing, transportation, energy, and environmental
    policy to help us meet these challenges.
        Recently, HUD and DOT announced an interagency partnership
    to promote sustainable communities.
        Mr. Sims, could you please elaborate on the nature and
    goals of this interagency partnership, and discuss what has
    been done thus far and what will be done in the future to
    advance these goals?

    A.4. The new partnership that Secretaries Donovan and LaHood
    announced last month between HUD and DOT is intended to create
    a new model of integrated housing and transportation planning,
    research and development in communities around the Nation. The
    partnership will work together to implement several new
    initiatives:
        First, we will set a goal to have every major metropolitan
    area conduct integrated housing, transportation, and land use
    planning in the next 4 years. To facilitate integrated
    planning, we propose to make planning grants available to both
    metropolitan and rural areas, and create mechanisms to ensure
    that those plans are carried through to localities. DOT will
    encourage Metropolitan Planning Organizations to conduct this
    integrated planning as part of their next long-range
    transportation plan, and HUD will work with its formula
    grantees (CDBO and HOME) to coordinate their Consolidated Plans
    with these regional housing and transportation plans. The goal
    of this effort will be to enable metropolitan areas to set a
    vision for growth and then apply Federal transportation,
    housing, and other investments in an integrated way in support
    of the broader vision. Coordinating these planning processes
    can result in improved use of Federal housing and
    transportation dollars, and expanded affordable housing
    opportunities near transit.
        Second, we will explore the feasibility of developing
    Federal housing affordability measures that include both
    housing and transportation costs. Although transportation costs
    now approach or exceed housing costs for many working families,
    Federal definitions of housing affordability do not account for
    the dual impact that high housing and transportation costs have
    on American families. The partnership will work to redefine our
    definitions of affordability to reflect these interdependent
    costs--so that the combined cost of housing and transportation
    expenditures is more transparent to working families.
        Third, HUD and DOT will work together to identify
    opportunities for coordinating their programs and encouraging
    ``location efficiency'' in housing and transportation choices.
    HUD and DOT will identify ways to incentivize locating housing
    near transit and review processes to facilitate better-informed
    decisions and coordinated housing and transportation
    investments.
        Fourth, HUD and DOT will conduct research, data collection,
    development of information platforms, and analytic tools to
    track housing and transportation options and expenditures,
    establish standardized and efficient performance measures, and
    identify best practices.
        We will be submitting detailed proposals to support these
    efforts in our Fiscal Year 2010 budget that will be submitted
    to Congress next month. In the meantime, HUD is encouraging the
    adoption of energy efficient, green building and location
    efficient practices through the expenditure of our Economic
    Recovery Act funds.
        In addition, joint HUD-DOT efforts are already underway
    through a HUD-FTA Working Group. In September 2008, FTA and HUD
    submitted a joint report entitled, Better Coordination of
    Transportation and Housing Programs To Promote Affordable
    Housing Near Transit, to the House and Senate Committees on
    Appropriations. This report outlines the strategies developed
    by FTA and HUD to implement the recommendations of a jointly
    sponsored 2007 study, Realizing the Potential: Expanding
    Housing Opportunities Near Transit, authored by Reconnecting
    America's Center for Transit Oriented Development. Over the
    next few months, the Working Group will produce a Best
    Practices Manual, convene key housing and transportation
    stakeholders and produce a series of Policy Reports on key
    issues related to lowering the cost of housing near transit.

    Q.5. How will this interagency partnership incorporate energy
    and environmental policies into your strategies for promoting
    sustainable communities?

    A.5. The partnership with DOT, and a parallel partnership with
    the Department of Energy, will address critical energy needs
    and environmental challenges facing our cities, suburbs, and
    rural areas. The residential sector--and the built environment
    more generally--are major contributors to energy consumption
    and global warming. Residential buildings account for 20
    percent of U.S. carbon emissions. The transportation sector
    accounts for another one-third of carbon emissions, in part
    because current development patterns have created a mismatch of
    housing and jobs that, without adequate transit systems, have
    led to long commutes and increased dependence on car travel.
    The average American household now spends 34 percent of their
    annual budget on housing, and 18 percent on transportation, a
    combined total of 52 percent of their budgets wrapped up in
    these, the two largest single expenses.
        Many families that moved out to the exurbs to find
    affordable housing have discovered that their home savings were
    wiped out by high transportation costs. While there were many
    factors that contributed to high foreclosure rates, high
    gasoline costs last summer compounded the problem of high
    housing and energy costs, with the result that some of the
    highest foreclosure rates are to be found in places with the
    highest transportation costs.
        By addressing both location efficiency and energy
    efficiency as key goals, the partnership will hopefully result
    in more compact development and more affordable housing options
    for local communities, improved zoning and creative land use
    strategies to preserve open space and increase infill
    development using existing infrastructure, and more energy
    efficient and green construction practices. In combination,
    these strategies will contribute to lowering vehicle miles
    traveled, increasing energy efficiency of our buildings, and
    lowering greenhouse gas emissions in our cities, suburbs, and
    rural communities.
                                    ------

            RESPONSE TO WRITTEN QUESTIONS OF SENATOR SHELBY
                            FROM RONALD SIMS

    Q.1. HUD's Management Challenges--Mr. Sims, despite efforts at
    improvement by previous administrations, HUD continues to
    suffer from significant long-standing management and
    operational challenges.
        As Deputy Secretary, how do you intend to address HUD's
    management and operational challenges?

    A.1. HUD, like many large organizations, requires dramatic
    reform in areas like information technology, space management,
    and human resources. What we achieved in King County when I was
    County Executive, was a cross-disciplinary team orientation
    which provided managers with effective tools and support, to
    implement and sustain effective and lasting change. Too often,
    organizational change merely scratches the surface; HUD needs
    to implement lasting change to meet their management and
    operational challenges. I am committed to working beyond simply
    creating a pass-fail bureaucracy. Employees need to be provided
    the necessary tools and incentives to affect real change.

    Q.2. Federal Government Role in Housing--Mr. Sims, you are
    serving in your third term as County Executive of King County,
    a large urban government.
        As a County Executive, what are your views on the proper
    role of the Federal government in housing?

    A.2. As an elected County Executive with over 12 years of
    experience, I feel strongly that the proper role of the Federal
    government in housing is one of partner to State and local
    governments. States and local governments, particularly during
    these times, welcome the funds provided by the Federal
    government to assist with new housing construction, housing
    rehabilitation, foreclosure prevention, and other important
    housing need areas. While States and local governments
    recognize the authority of the Federal government to impose
    requirements that must be adhered to with the provision of
    Federal funds, State and local governments also must have a
    voice in the expenditure of these Federal funds. State and
    local officials are at the forefront of dealing with the
    housing needs in their jurisdictions. In King County, we built
    strategic partnerships, similar to the ``national network of
    partners'' that Secretary Donovan outlined in his confirmation
    testimony. As I stated in my testimony, I believe deeply in
    partnerships and, as Deputy Secretary of HUD, I will work, as a
    partner, with State and local governments and housing
    authorities, nonprofit organizations, and private developers to
    help the States and localities meet their housing needs.

    Q.3. To what degree should local governments be provided with
    the flexibility to meet their housing needs and how can it be
    done in a manner that ensures accountability?

    A.3. All State and local governments recognize that by
    accepting Federal funds to address housing needs, Federal
    requirements will apply to the expenditure of those funds.
    However, as a County Executive, I believe that local
    governments should be provided with as much flexibility as
    possible within the parameters of the Federal law governing the
    funds. State and local government officials are in the best
    position to assess the specific housing needs in their areas,
    determine how these needs should be addressed and the priority
    in which these housing needs should be addressed. With respect
    to accountability, President Obama already has set the standard
    for all Federal agencies to be transparent in the allocation
    and expenditure of Federal funds, not only for Recovery Act
    funds, but for all funds. As Senator, President Obama was one
    of the sponsors of the Federal Accountability and Transparency
    Act, which establishes transparency and accountability
    requirements for all Federal funds.
                                    ------

           RESPONSE TO WRITTEN QUESTIONS OF SENATOR MENENDEZ
                            FROM RONALD SIMS

    Q.1. Last year I introduced legislation to reform the HUD
    Section 811 program. This bill, known as the Frank Melville
    Supportive Housing Investment Act (S. 3593), would reform
    Section 811 to make it a more effective program in developing
    permanent supportive housing options for nonelderly people with
    disabilities. The bill would reform the current capital advance
    program and allow for a new category of multifamily projects
    and end the flawed and ineffective mainstream tenant-based
    program. Most importantly, the bill would authorize a new
    project-based demonstration program that has the potential to
    triple the number of new units developed by Section 811--
    without increasing the current appropriation. The House
    unanimously passed this bill in September 2008. I will soon
    reintroduce the bill in the 111th Congress. If confirmed will
    you work with me and Chairman Dodd to move this legislation
    forward?

    A.1. Yes. HUD has expressed general support for the
    legislation. I understand that HUD indicated there were
    portions of the proposed legislation that could be amended to
    enhance the legislation. I look forward to the opportunity to
    work with you on this important legislation.

    Q.2. Some critics of the Department have argued that too much
    low income housing has been concentrated in higher poverty and
    lower opportunity neighborhoods. What will HUD do to ensure
    that more assisted housing is located near high quality
    schools, job openings, and recreation opportunities? What kind
    of data will HUD use to measure its progress in this area?

    A.2. President Obama is committed to addressing the needs of
    higher poverty neighborhoods. Secretary Donovan and I share
    your concern about reducing the concentration of assisted
    housing tenants in high poverty and low-opportunity
    neighborhoods. The President's 2010 budget proposal for HUD
    will include a request to adequately fund housing vouchers, a
    proven tool for giving families an opportunity to move to lower
    poverty neighborhoods, as well as funding for a new initiative
    called Choice Neighborhoods, that will focus on catalyzing the
    transformation of distressed neighborhoods with assisted
    housing into neighborhoods with high quality housing, schools,
    and opportunities for jobs and recreation. Data from the Census
    Bureau's American Community Survey will allow annual tracking
    of neighborhood change beginning in 2010. In addition, HUD will
    use other tools such as data from the Department of Education
    on school performance, data from the U.S. Postal Service on
    houses not receiving mail, data on the location of transit
    stations, and data collected for the Home Mortgage Disclosure
    Act on housing purchases to track neighborhood trends relative
    to where public and assisted housing tenants live.

    Q.3. King County was known for its innovative ``Equity and
    Social Justice Initiative,'' which assessed certain budgetary
    and planning decisions from an equity perspective. Could you
    talk about how that approach could be applied to HUD programs--
    and in particular the Making Home Affordable program?

    A.3. The principles of King County's initiative are fundamental
    to HUD's core mission and easily adaptable to HUD's new
    leadership and commitment to transforming the agency. The goal
    of the Initiative is for all King County residents to live in
    communities of opportunity. To reach this goal, all communities
    must be equipped with the means to provide individuals with
    access to livable wage, affordable housing, quality education,
    quality health care, and safe and vibrant neighborhoods. King
    County is applying the principles of the equity and social
    justice in its actions, decisions, and policies.
        Equity and Social Justice Principles:

        Identify and address the conditions at the root of
            inequities

        Actively seek out and promote decisions and
            policies aimed at equity

        Empower communities

        Work across agencies and departments

        Recognize and honor cultural differences

        Raise and sustain visibility of equity and social
            justice, and aim for long-term,

        permanent change

        These principles are incorporated into the policy
    development and decision-making to ensure that promoting equity
    is intentionally considered in the development and
    implementation of key policies and programs and in funding
    decisions. The Equity Impact Tool developed for the initiative
    is starting to be used by King County departments. Extensive
    internal and external communication is used to help drive the
    delivery of county services and empower and build the capacity
    of organizations and the community.
        In regard to the Making Home Affordable programs at the
    Department of Treasury, HUD shares the concern that principles
    of equity and social justice have been applied to the
    development and implementation of these programs. In
    particular, HUD has been working with the Treasury Department
    to gather data to review whether the Government Sponsored
    Entities (GSEs) and loan servicers administer the Making Home
    Affordable programs do so in a manner that is consistent with
    the Fair Housing Act.

    Q.4. As you know, the Low Income Housing Tax Credit program is
    the largest assisted housing production program in the U.S.
    Because the program is administered by the Treasury Department,
    not by HUD, the program has not adopted any fair housing
    regulations. HUD has the authority to enforce the Fair Housing
    Act and the requirement that all Federal funding is used to
    affirmatively further fair housing. How will HUD use this
    authority with the LIHTC program?

    A.4. HUD, the Department of Justice and the Department of
    Treasury's Internal Revenue Service entered into a memorandum
    of understanding (MOU) regarding the Low Income Housing Tax
    Credit Program and potential Fair Housing Act (Act) violations
    in August 2000. The MOU provides that HUD and DOJ will report
    to the appropriate State or local housing finance agency any
    charge of discrimination and any settlement agreement or
    consent decree under the Fair Housing Act that involves a tax
    credit property. In addition, HUD requires substantially
    equivalent State and local agencies to report such information
    to the housing finance agencies. The housing finance agencies
    then reports this potential noncompliance to the IRS, which
    then notifies the relevant property owners that they may lose
    their tax credits if found to have violated the Act. HUD will
    continue to work to ensure that persons who violate the Act do
    not benefit from tax credits. I note that the Internal Revenue
    Service has regulations concerning fair housing, 26 C.F.R.
    1.42-55 and -9.
                                    ------

            RESPONSE TO WRITTEN QUESTIONS OF SENATOR BENNETT
                            FROM RONALD SIMS

    Q.1. Given President Obama's affirmation of faith-based
    offices, what is your vision for using the office to help
    implement HUD's priorities?

    A.1. The HUD Center for Faith-Based and Community Initiatives
    (CFBCI) works to engage partners and stakeholders--both faith-
    based and secular--around the agency's agenda and ensure their
    experience informs our work. The CFBCI also works to ensure
    that organizations rooted in the community are able to access
    and participate in HUD programs, while emphasizing the agency's
    standards of transparency, accountability, and efficacy.
    Through regular communication, events, and trainings, the CFBCI
    reaches thousands of organizations every month.
        Going forward, the CFBCI will work closely with the Office
    of Field Policy and Management (FPM) and program offices to:
    (1) play a lead role in outreach to faith-based and community
    organizations about the agency's priorities and opportunities
    to become involved in programs focused on economic recovery,
    support for homeowners, community development, homelessness,
    and the provision of affordable housing free from
    discrimination; (2) offer technical assistance to partners,
    including targeted grant trainings and capacity building; (3)
    foster new partnerships at the community level to identify
    needs and new approaches to addressing them.

    Q.2. What personnel changes has HUD made so far this year to
    ensure that the faith-based office is able to meet its
    mandates?

    A.2. HUD recently appointed a new Director of the CFBCI to
    oversee this work; and a new Staff Assistant. There are seven
    other career staff in the center and a nationwide network of
    field office liaisons who coordinate with the CFBCI. In
    consultation with the Deputy Secretary's office and the White
    House Office for Faith-Based and Neighborhood Partnerships, the
    Director is engaging in a department-wide review and planning
    process to ensure that in the short term the CFBCI is meeting
    the objectives set out in the FY2009 APP; and setting new
    objectives to support HUD's priorities.

    Q.3. What program areas are likely to be enhanced by greater
    faith-based office involvement?

    A.3. We envision more robust outreach, technical assistance,
    and support to groups who would participate in HUD programs
    focused on economic recovery, support for homeowners, community
    development, homelessness, and the provision of affordable
    housing free from discrimination.
                                    ------

             RESPONSE TO WRITTEN QUESTIONS OF SENATOR CRAPO
                            FROM RONALD SIMS

    Q.1. As FHA reserves continue to dwindle, what solutions do you
    propose to restore the reserves so that FHA continues to
    operate on a sound financial basis? Will you advocate for an
    appropriation? Will you increase premiums? If so, will they be
    front-end increases or annual during the life of the loan?

    A.1. Financial stability of the FHA's Mutual Mortgage Insurance
    Fund not only is a matter of sound fiscal management but also
    is the subject of statutory requirements under the National
    Housing Act. FHA reserves in the Mutual Mortgage Insurance Fund
    currently satisfy program requirements, but I share the concern
    expressed about the recent reduction in the amount of those
    reserves. If confirmed, I will work closely with the FHA
    Commissioner in his review of the fund's current and
    anticipated activity and in the development of any proposals
    that may be needed to ensure that operations of FHA's single
    family mortgage insurance programs are done in a fiscally sound
    manner and in conformity with statutory requirements.

    Q.2. The HUD Hope for Homeowners program has received very few
    applications and few banks have signed up to participate. What
    are your objectives with this program going forward?

    A.2. The current very low activity in the HOPE for Homeowners
    Program is disappointing, but a bill (H.R. 1106), entitled the
    ``Helping Families Save Their Homes Act of 2009,'' was passed
    by the house and is pending before the senate. There are
    several HOPE for Homeowners provisions in this bill which would
    address issues raised by potential participants in the program,
    including incentives for loan servicers and less onerous
    requirements for borrowers. If confirmed, I will work with the
    FHA Commissioner and his program officials to ensure
    implementation of these changes, if enacted, as soon as
    possible in order to increase program activity.

    Q.3. Are you intending to make additional changes to the RESPA
    rule?

    A.3. The Real Estate Settlement Procedures Act (RESPA) is
    intended to reduce unnecessary and excessive settlement costs
    for home purchasers by ensuring that necessary information is
    available to them as they prepare to purchase a house with a
    mortgage loan, and to eliminate abusive practices like
    kickbacks and referral fees. The recent RESPA rulemaking
    process has been an effort by HUD to improve a home purchaser'S
    ability to shop by providing for more timely and clearer
    disclosure of information.
        HUD issued its RESPA reform regulation in November of 2008.
    Under the new rule, home purchasers will receive disclosure of
    pertinent information regarding their mortgage loans and
    related settlement charges earlier in the shopping process
    through a standardized Good Faith Estimate (GFE) and revised
    HUD-1 form. The most significant provisions of the new rule
    would go in effect on January 1, 2010. If confirmed, I will
    assist HUD officials in their evaluation of the new rule in
    order to assess the need for any additional changes in the
    future.
        I understand that HUD is in litigation that challenges two
    aspects of the RESPA rule: the ``required use'' provision and
    the mandatory disclosure of mortgage broker compensation. I
    understand that HUD is considering withdrawing the ``required
    use'' provision as drafted, and is defending the litigation
    concerning mortgage broker compensation vigorously consistent
    with its belief that transparency is essential to protect
    consumers in making what is among the most significant
    purchases in their lives.

    Q.4. How do you plan to use FHA authorities as well as working
    with Ginnie Mae to address the dramatic evaporation of
    warehouse credit line availability to FHA lenders?

    A.4. Discontinued, I will work closely with HUD officials in
    their effort to respond to this situation in a manner that is
    consistent with their statutory authority. I also will work
    with other agencies, such as the Treasury Department, to
    determine whether FHA and Ginnie Mae could provide assistance
    in the operation of a credit facility that would provide
    liquidity support for nondepository Ginnie Mae approved
    issuers, or to warehouse lenders supporting nondepository
    Ginnie Mae issuers, in connection with FHA insured or VA
    guaranteed loans.
                                    ------

            RESPONSE TO WRITTEN QUESTIONS OF SENATOR VITTER
                            FROM RONALD SIMS

    Q.1. How long do you want and plan to keep Disaster Housing
    Assistance Program available to affected families in the Gulf
    Coast Region?

    A.1. As you may know the Disaster Housing Assistance Program is
    a FEMA program administered by HUD pursuant to an MOU. The
    program was to terminate March 2009, and funds have been
    appropriated to provide vouchers for eligible families that
    continue to require ongoing housing assistance. However, the
    program has been extended until August 2009 to allow for a
    transition period for the affected families. At this time there
    is no intent to extend the program beyond August 2009.

    Q.2. Do you have any plans to change the program?

    A.2. As you are aware, any discussion to change the program for
    future disasters must be had with FEMA. I understand that HUD
    and FEMA have made some systems and procedural changes to DHAP-
    Ike based on their experience with DHAP. However, I am not
    aware of any intention to make substantive changes, but look
    forward to learning more about the program and to discuss with
    my counterpart at FEMA issues that may require changes to the
    program.

    Q.3.The White House Web site reads: My Administration is
    committed to creating an unprecedented level of openness in
    Government. We will work together to ensure the public trust
    and establish a system of transparency, public participation,
    and collaboration. Openness will strengthen our democracy and
    promote efficiency and effectiveness in Government.
        Yet, on March 22, 2009, news reports indicate that there
    has been a protracted, 12-year legal battle involving
    government documents relating to Qwest Field. This legal bill
    will be approximately $1 million. Is this the standard that
    this Committee and the American people can expect from HUD? How
    will you work to ensure that you will be open and transparent
    with the American people in your new role at HUD?

    A.3. I am aware of the President's Executive Order on
    Transparency, Openness, and Collaboration in Government. As I
    stated in my testimony at my confirmation hearing, HUD must be
    an accountable, transparent, and effective organization--ready
    to embrace the new era of management oversight so that program
    activities and outcomes, contracts, grants, and loans satisfy
    these transparency and accountability provisions, and also
    mitigate fraud, waste, and abuse. I am committed to the
    challenge put forth before me by President Obama and Secretary
    Donovan to bring transformational change to HUD and further
    ensure the integrity of HUD programs.
        With regard to the litigation involving Qwest Field, since
    that matter is involved in active litigation, I am regrettably
    unable to comment upon that case.

    Q.4. Section 108 is the loan guarantee provision of the
    Community Development Block Grant (CDBG) program that provides
    communities with a source of financing for economic
    development, housing rehabilitation, public facilities, and
    large-scale physical development projects. Clearly, this is a
    very important tool for both HUD and local governments.
        You gave a low-interest-rate HUD loan to build a four-star
    hotel at the Seattle-Tacoma International Airport. Those loans
    are intended to clean up blighted areas and typically go to
    nonprofits, low-income housing developers, or social service
    agencies. Do you think that that loan, to an upscale hotel and
    casino owner, was an appropriate use of taxpayer funds? Was
    there no other, more worthy project?
        Would you allow localities to make such loans?

    A.4. Section 108 loans are not limited to cleaning up blighted
    areas. The loans can be used for economic development projects
    that benefit low and moderate income persons by creating jobs.
    The hotel in question was not undertaken. Had it been
    undertaken, however, it would have met the national objectives
    criteria and would have exceeded the minimum public benefit
    standards. Also, it is worth noting that HUD-guaranteed Section
    108 loans are not funded with taxpayer funds. HUD arranges a
    public offering of securities backed by the guaranteed notes.
    Private investors provide the actual funding, not the
    taxpayers.
        Under the Section 108 program, like CDBG, the local
    government--not HUD--decides which eligible projects to fund.
    Like CDBG, the local government must undertake citizen
    participation in preparing its Section 108 application. It is
    appropriate that local governments who know the needs of their
    communities decide which projects are worthy.
        If the loan will be used for an eligible activity which
    meets a national objective (and the guarantee is not an
    unacceptable financial risk), the local governments may decide
    which projects to fund.
                                    ------

             RESPONSE TO WRITTEN QUESTIONS OF SENATOR DODD
                         FROM FRED P. HOCHBERG

    Q.1. Export-Import Bank's Role in the Current Economy--The
    current COO of Export-Import Bank (Ex-Im Bank) recently
    summarized the economic situation at Ex-Im Bank's Annual
    conference by paraphrasing Dickens by saying, ``In our case, it
    is the worst of times for the global economy BUT the best of
    times for Ex-Im Bank . . . .''
        The extraordinary situation occurring in the U.S. financial
    sector has created enormous challenges but it also highlights
    the incredible opportunity facing Ex-Im Bank as it tries to
    fulfill its core mission of supporting U.S. exporters and their
    workers by providing financing for exports that would otherwise
    not go forward.
        One of those opportunities would be to utilize Ex-Im Bank's
    authority to do direct lending. Do you foresee Ex-Im Bank doing
    more direct lending? What other new programs or ideas do you
    think should be pursued?

    A.1. While it is too early for me to comment on new programs, I
    am committed to seeking new and innovative tools and products
    to help exporters and commercial banks in supporting U.S.
    exports. However, Ex-Im Bank is already doing much more direct
    lending over last year. Staff at the Bank believes this trend
    will continue until the commercial banks here and around the
    world recover. In the first half of FY09, Ex-Im has authorized
    15 direct loans. The Bank authorized two in FY08.

    Q.2. Inspector General's Report Concerning Fraud in Medium Term
    Program--In the last Congress, this Committee confirmed the
    inaugural Inspector General. It appears to have been a very
    timely exercise, as that office has identified fraud in over
    $100 million in medium term transactions. Some estimate, that
    up to $300 million in fraud has been committed in that program
    since 2002.
        The Inspector General recently released a report detailing
    the fraud and the report also highlighted a number of specific
    steps Ex-Im Bank should take to address this problem. Are you
    committed to working with the IG to implement those
    recommendations, particularly concerning the strategic planning
    for the medium term program and for Ex-Im Bank in general?

    A.2. As a businessman for over 20 years, the one thing I don't
    like to do is to lose money to fraud. Therefore, I am fully
    committed to working with the Inspector General to review his
    recommendations and, where prudent, implement them.

    Q.3. Small Business--Congress has mandated that Ex-Im Bank use
    20 percent of its annual authorizations on small business
    transactions.
        Given your background at SBA, do you have any ideas on how
    to further expand Ex-Im Bank's role with small business
    exporters so that 20 percent can become a floor, not a ceiling?

    A.3. One of the reasons that President Obama nominated me to be
    President and Chairman of Ex-Im Bank was my small business
    background.
        While I would like to make the 20 percent a floor, Ex-Im
    Bank needs to support ALL exporters, small and large, in these
    difficult economic times. What I can commit to is to focus on
    small business and work to ensure that Ex-Im Bank encourages
    small business exports in all ways possible. This is something
    I firmly believe in.
        Furthermore, it is my understanding that for the first time
    in its history, the Bank has authorized over $1 billion for the
    support of small businesses in the first 6 months of the year.
    Given my dedication and interest in small business, I hope to
    see this number increase.
                                    ------

            RESPONSE TO WRITTEN QUESTIONS OF SENATOR SHELBY
                         FROM FRED P. HOCHBERG

    Q.1. Expansion of Ex-Im Financial Support--Mr. Hochberg, over
    the past few months, Ex-Im has responded to the ongoing
    financial crisis by enhancing and modifying some of its
    programs to provide more liquidity in the trade finance market.
    Ex-Im has increased its direct lending and short-term finance
    programs, and modified its direct lending program to cover a
    wider range of transactions. While it is important that Ex-Im
    support trade finance in this difficult time, it is also
    important that Ex-Im not water-down its underwriting criteria
    and expose itself to losses.
        How do you plan to balance the increased demand for trade
    financing with Ex-Im's need to maintain sound underwriting
    standards?

    A.1. Reasonable assurance of repayment guides all Ex-Im Bank
    transactions. The Bank's job is to take reasonable risk. Our
    mandate is to help correct market imperfections. If confirmed,
    I will ensure that our rigorous underwriting standards are
    maintained. At the same time, we need to keep in mind that Ex-
    Im Bank exists to sustain and create U.S. jobs in this
    difficult economy.

    Q.2. Small Business Lending--Mr. Hochberg, the Ex-Im Bank is
    required to allocate 20 percent of its authorizations to small
    businesses. While Ex-Im has allocated more than 20 percent of
    its authorizations to small business during the past 3 years,
    it previously had difficulty meeting the 20 percent mandate.
        What steps do you think Ex-Im can take to ensure that it
    continues to meet the needs of small businesses and satisfy the
    20 percent mandate?

    A.2. I look forward to working with Karen Mills the new SBA
    Administrator and finding ways for our two agencies to work in
    greater concert to increase small business exports. This was a
    finding that Karen and I reached when we both worked on the SBA
    transition team this past fall. Ex-Im may need some new loan
    and insurance products. I also look forward to working with
    members of Congress to convene town hall meetings throughout
    the country to better engage small business owners. As I stated
    in my testimony, I also want to review our customer service to
    ensure that Ex-Im Bank provides top notch service to all
    customers, especially small business customers. I have already
    consulted Ex-Im Bank's senior vice president for small business
    on how we can improve our outreach to small businesses.
                                    ------

            RESPONSE TO WRITTEN QUESTIONS OF SENATOR BUNNING
                         FROM FRED P. HOCHBERG

    Q.1. Recently, the Export-Import Bank came under Congressional
    scrutiny when it became known that Ex-Im provided $900 million
    in loan guarantees to benefit Reliance Industries Limited, an
    Indian company which has been supplying some 10 percent of
    Iran's gasoline needs. Over $500 million of these loan
    guarantees were to help finance expansion of Reliance's
    Jamnagar refinery complex, the very refinery complex at which
    this gasoline for Iran is refined. Some portion of these loan
    guarantees to Reliance has apparently not yet been disbursed.
    Letters from several members of Congress called on Ex-Im to
    cease disbursement of these loan guarantees until Reliance
    halts its supply of gasoline to Iran. Indian newspapers
    recently reported, without direct confirmation from Reliance,
    that Reliance has responded to Congressional concerns by
    deciding to halt further gasoline exports to Iran.
        Can you confirm that Reliance has agreed to halt its
    provision of gasoline to Iran? If not, do you support halting
    further disbursement and any new loan guarantees to Reliance
    until they stop supplying gasoline to Iran? If so, can you tell
    us what your response would be if Reliance resumes supplying
    gasoline to Iran while Iran continues to be a state sponsor of
    terrorism and continues to advance its illicit nuclear program?

    A.1. General Statement Preceding Specific Answers--I want to
    assure you that as a private citizen I share your concerns
    regarding state sponsors of terrorism, including Iran. These
    are foreign policy concerns of the utmost importance to the
    United States and its allies.
        I have been informed that when foreign policy concerns are
    part of Ex-Im Bank transactions, the Bank consults closely with
    the Department of State and the Department of Treasury. This is
    because the Bank is limited to considering transactions on the
    basis of finance and adherence to the Bank's environmental
    guidelines. I am also informed that there is a mechanism by
    which the State Department can direct the Bank to consider
    nonfinancial factors when deciding on whether to approve a
    transaction. If confirmed, I commit to follow the requirements
    of Ex-Im Bank's charter on this and all other matters.
        Since I was not involved in this matter, I cannot confirm
    whether or not Reliance has agreed to halt its provision of
    gasoline to Iran. I also cannot make judgments as to what
    future relations between the Ex-Im Bank and Reliance, or any
    other Bank customer, should be, regarding state sponsors of
    terrorism. These are foreign policy issues, so the Bank will
    consult closely with the Departments of State and Treasury on
    such matters. If confirmed, I will keep you informed of
    developments.

    Q.2. Are you aware of any future Ex-Im loan guarantees which
    involve Reliance Industries?

    A.2. I am not aware of any future Ex-Im transactions which
    might involve Reliance or any other specific buyer. If
    confirmed, I will keep you informed of any such transaction.

    Q.3. JP Morgan is one of the banks which have benefited from
    U.S. bank-share purchase program (or bailout). It is also the
    bank which has been contracted to provide the loans associated
    with Reliance's Jamnagar refinery. Are you aware of discussions
    with JP Morgan where it has been asked and the Ex-Im Bank has
    been assured that no loans backed by Ex-Im will be provided to
    companies that have business dealings with Iran? This includes
    the loans involving Reliance that have not yet been dispersed.

    A.3. I am in no position to know what discussions have taken
    place. If confirmed, I will pay particular attention to any
    matters dealing with Reliance.

    Q.4. What should the Bank's policy be with regard to providing
    loan guarantees to companies whose projects benefit directly or
    indirectly state sponsors of terrorism or do business with
    state sponsors of terrorism?

    A.4. This is a complex issue of utmost importance to U.S.
    foreign policy. If confirmed, I will consult closely with the
    Departments of State and Treasury regarding issues of state
    sponsors of terrorism.

    Q.5. As Chairman of the Ex-Im Bank, what mechanisms would you
    put in place to ensure that, as a matter of Ex-Im policy, all
    interaction and correspondence between the Bank and prospective
    loan guarantee beneficiaries be shared with the Bank's board
    prior to approval of the loan guarantees?

    A.5. If confirmed, I will assure that as a matter of Bank
    policy Board members will be kept fully informed of all
    materials relevant to their responsibilities to make sound
    decisions regarding transactions before them, including issues
    of state sponsors of terrorism.

    Q.6. Should language be inserted in standard Bank loan
    applications committing loan recipients to halting business
    dealings with state sponsors of terrorism?

    A.6. I cannot comment on this issue at this time. However, if
    confirmed, I will consult with our Office of General Counsel
    and work closely with the Departments of State and Treasury
    regarding this very important matter of U.S. foreign policy.
                                    ------

            RESPONSE TO WRITTEN QUESTIONS OF SENATOR SHELBY
                         FROM HELEN R. KANOVSKY

    Q.1. Fraud and Lending--On several occasions, HUD's Inspector
    General has raised concerns regarding FHA's lax approach to
    reducing fraud in its mortgage insurance programs. For
    instsnce, the IG reported last year that FHA does not
    consistently refer potentially fraudulent loans to the
    Inspector General's Office.

        What efforts can be taken to eliminate fraud in FHA
            programs?

        Do you have any perspective on steps that can be
            taken to reduce or eliminate fraud?

    A.1. I strongly support any steps government can take to reduce
    or eliminate fraud in HUD programs. The Office of General
    Counsel aggressively prosecutes fraud and malfeasance in HUD
    programs through its enforcement authorities, such as the
    Program Fraud Civil Remedies Act (PFCRA) and Civil Money
    Penalty statutes. HUD is the lead agency in the Federal
    govermnent in its use of the PFCRA to combat fraud.
        It is my intention to fully support and expand, where
    possible, pursuit of fraud cases under any enforcement
    mechanism available to the Department. If confirmed, I will be
    committed to increasing and enhancing HUD's enforcement
    abilities. I will work with HUD's Mortgagee Review Board (MRB)
    to sanction FHA-approved lenders for failing to comply with HUD
    requirements.
        I look forward to working with HUD's Inspector General,
    HUD's Home Ownership Centers, Mortgagee Review Board, and other
    government agencies, including the Department of Justice, to
    incresse enforcement against FHA-approved mortgagees and others
    who commit fraud in HUD programs.
                                    ------

             RESPONSE TO WRITTEN QUESTIONS OF SENATOR CRAPO
                         FROM HELEN R. KANOVSKY

    Q.1. As FHA reserves continue to dwindle, what solutions do you
    propose to restore the reserves so that FHA continues to
    operate on a sound financial basis? Will you advocate for an
    appropriation? Will you increase premiums? If so, will they be
    front-end increases or annual during the life of the loan?

    A.1. Financial soundness of the FHA Mutual Mortgage Insurance
    Fund is required by section 205(h) of the National Housing Act.
    If confirmed, I will work closely with the Secretary and the
    FHA Commissioner to implement whatever steps they determine, on
    the basis of their review of present and anticipated program
    activity, to preserve the financial soundness of the Mutual
    Mortgage Insurance Fund.

    Q.2. The HUD Hope for Homeowners program has received very few
    applications and few banks have signed up to participate. What
    are your objectives with this program going forward?

    A.2. Pending legislation, entitled ``Helping Families Save
    Their Homes Act of 2009'' (H.R. 1106), was passed by the House
    and currently is pending in the Senate. The bill has several
    specific improvements to the HOPE for Homeowners program that
    include simplification of the process and incentives for the
    loan servicers. If confirmed and if this bill is enacted, I
    would take all necessary steps to assist the Secretary and the
    FHA Commissioner to implement the statutory amendments so that
    program participants can benefit from them as soon as possible.

    Q.3. Are you intending to make additional changes to the RESPA
    rule?

    A.3. As you know, the Real Estate Settlement Procedures Act
    (RESPA) is a major consumer protection statute intended to
    provide protection to consumers in the home mortgage settlement
    process through increased disclosure and the elimination of
    abusive practices such as kickbacks and referral fees. With the
    current mortgage crisis, and the Department's interest in
    eliminating all forms of mortgage fraud which may have
    contributed to the crisis, RESPA has taken on even more
    importance.
        HUD's issuance of its RESPA reform regulation in November
    of 2008 was a major revision of HUD's RESPA regulations,
    including the disclosures that are required to be provided to
    borrowers with regard to their mortgage loans and the
    associated settlement charges that are disclosed on the Good
    Faith Estimate (GFE) and the HUD-1. The intent of the new rule
    is to make these RESPA disclosures more timely and effective,
    with the ultimate goal of reducing mortgage costs for
    consumers. The most significant provisions of the new rule are
    not required to be used until January 1, 2010. HUD will
    continue to evaluate the new rule during this 12 month
    implementation period to assess the need for any additional
    changes going forward.
        Two aspects of the RESPA rule are being currently
    challenged. In National Association of Home Builders, et al. v.
    Preston, No. 08-1324 (E.D. Va.), plaintiffs have challenged
    HUD's required use provision under the Administrative
    Procedures Act. HUD has issued a notice proposing to withdraw
    the required use provision from the rule and is considering
    comments to this proposal. The court has stayed the litigation
    until May 8, 2009, to provide HUD an opportunity to respond to
    the comments. The second suit, National Association of Mortgage
    Brokers, Inc. v. Preston, No. 08-2208 (D.D.C), challenges HUD's
    requirement that mortgage brokers disclose their compensation.
    HUD is vigorously defending this suit and anticipates a
    decision prior to the rule's January 1, 2010, implementation
    date.

    Q.4. How do you plan to use FHA authorities as well as working
    with Ginnie Mae to address the dramatic evaporation of
    warehouse credit line availability to FHA lenders?

    A.4. If confirmed, I would carefully review the statutory
    authorities for FHA and Ginnie Mae programs to determine what
    options, if any, may be available under current law with regard
    to warehouse lines of credit, and consult with program
    officials to ensure all options are thoroughly considered. I
    would also consult with other agencies, such as the Treasury,
    to determine if FHA and Ginnie Mae could provide assistance in
    the operation of a credit facility that would provide liquidity
    support for nondepository Ginnie Mae approved issuers, or to
    warehouse lenders supporting nondepository Ginnie Mae issuers,
    in connection with FHA insured or VA guaranteed loans.
                                    ------

             RESPONSE TO WRITTEN QUESTIONS OF SENATOR DODD
                         FROM DAVID H. STEVENS

    Q.1. Viability of FHA--One of the few bright spots in the
    current housing economy has been the role being played by the
    Federal Housing Administration. Just a year or two ago, many
    people were asking whether or not the FHA program was a vestige
    of another era--its market share had dropped 3 percent. Today,
    that market share has expanded to between 20 percent and 30
    percent; without FHA, millions of Americans would have no
    access to mortgage credit at all.
        At the same time, the very housing market that has wreaked
    such havoc with so many mortgage lenders is also hurting FHA.
    For example, FY08 capital ratio is estimated to be 3 percent,
    down from 6.4 percent last year.
        To a certain extent we want FHA to be this kind of counter-
    cyclical force in the market, able to absorb losses while
    continuing to lend, even in the bad times. But we also have to
    be mindful of the solvency of the fund.
        What steps can be taken to enure the ongoing financial
    health of FHA?

    A.1. As indicated in my statement to the Committee, maintaining
    actuarial soundness of the fund is priority number one and
    would involve the following steps. First, if confirmed, I will
    immediately begin looking at specific product terms of the FHA
    program against performance data to identify potential areas of
    adverse selection in order to create changes that may be needed
    to the program. Second, we will look to immediately impact the
    quality of the seller pool by identifying outliers in the
    program and eliminating those with questionable capital or
    performance levels as a means to protect the fund from fraud or
    other adverse impact from low performers. Third, if confirmed,
    we will assemble a team to analyze revenues from the new
    business against loan loss data and work to create options, as
    needed, to strengthen the capital reserves of the fund. Please
    let me reiterate, as I stated in my comments to the Committee,
    that solvency of the fund for the short and the long term is a
    priority. The short term questions are ones that I cannot
    answer until I am confirmed and able to engage with the
    organization to assess the risk profile of the portfolio.

    Q.2. Career--You were Senior Vice President at Freddie Mac.
    Please describe your role specifically regarding Freddie Mac's
    purchase of subprime and high-risk products?

    A.2. Freddie Mac was essentially two businesses prior to its
    restructuring. The primary business that was at the core of its
    mission was providing a guarantee on the flow deliveries of
    standard business, primarily 30 and 15 year fixed-rate
    mortgages, from mortgage sellers throughout the Nation into TBA
    securities. It was this business for which I was largely
    responsible, along with several other Senior Executives. The
    other business was in the portfolio in which Freddie Mac was a
    buyer of nonstandard products in the market with shareholder
    returns as the primary objective. It was in the portfolio that
    the purchase of the subprime and the other high risk products
    occurred. I did not manage or have responsibility for this side
    of the company in any way. One of the areas that did report to
    me for a time included our expanding markets organization which
    was tasked with helping to expand homeownership with low/mod,
    special affordable, and underserved markets. In this area
    Freddie Mac did offer a program under its ``home possible''
    product menu that was designed to match the Fannie Mae ``My
    Community'' product. This product had a high loan to value
    ratio and a lower FICO score requirement, but it had primary
    mortgage insurance that covered the top 40 percent of the value
    and had credit guidelines that were far superior to anything in
    the subprime market. This was perhaps the most risky product on
    the flow side of the business, but it was a very small volume
    and was heavily insured from a risk perspective. I left Freddie
    Mae in early 2005, while their financial health was still very
    strong, and both loan performance and company profits were
    high.
                                    ------

            RESPONSE TO WRITTEN QUESTIONS OF SENATOR SHELBY
                         FROM DAVID H. STEVENS

    Q.1. Fraud and Lending--On several occasions, HUD's Inspector
    General has raised concerns regarding FHA's lax approach to
    reducing fraud in its mortgage insurance programs. For
    instance, the IG reported last year that FHA does not
    consistently refer potentially fraudulent loans to the
    Inspector General's Office.
        Mr. Stevens, what efforts can be taken to eliminate fraud
    in FHA programs?

    A.1. If confirmed, I will directly address this issue.
    Unfortunately, without specific data or access, I would only be
    able to speculate. The OIG concerns need to be looked at and
    aggressively addressed. Let me state clearly that fraud is
    absolutely not tolerated in the mortgage market and cannot be
    tolerated in FHA programs. I believe that the OIG should be an
    area of close cooperation with FHA to root out fraud and
    eliminate and/or prosecute as it occurs. System enhancements
    with stronger risk oversight in FHA can be a significant impact
    to protect against fraud and misrepresentation, and this is an
    area of priority for me, if I am confirmed.

    Q.2. Financial Health of FHA--The crisis in our mortgage
    markets has not been confined to solely the sub-prime market.
    The last 2 years have witnessed increasing delinquencies in
    FHA's single family business. In FY08 alone, the economic value
    of FHA's insurance fund fell by over $14 billion, a decline of
    almost 70 percent of the fund's value in FY07. At the same
    time, FHA's presence in the market has increased dramatically.
        Mr. Stevens, is it possible that we could see a continued
    decline in FHA's health, potentially wiping out the fund's
    remaining value?

    A.2. At this point the FHA insurance fund is actuarially sound
    and should be sound through FY2010. As expressed in my
    statement to the Committee, this would be job number one to
    address. If confirmed, I will immediately look into the
    portfolio strength, current performance trends by book year,
    State, product, lender, and program characteristic to determine
    if, and where, we can make substantive changes to protect the
    current and future state of the fund. I pledge that I will
    evaluate and report back to this body our findings if I am
    confirmed.

    Q.3. Do you believe FHA has sufficient resources, in terms of
    staff and technology, to safeguard the taxpayer from loss?

    A.3. I have not had the opportunity to assess the full capacity
    of the FHA resources and will do so quickly, if confirmed,
    since the ability to address these complex issues requires
    effective people, funding, and tools. I do know that FHA has a
    strong, dedicated employee base of long-term career talent that
    will be depended upon to help in this effort. I also know that
    the FHA systems have significant deferred maintenance. A
    business of this size cannot operate over so many years without
    systems investment. The fact that FHA has grown from such a
    small business relative to market size to one that approximates
    one-third of the mortgage market is a testament to the existing
    organization that they can manage this kind of incremental
    change with limited incremental funding to support the growth.
    If confirmed, an area that I intend to look for enhancement in
    resources is the overall credit risk management area in order
    to determine how best to manage and control risk across all off
    FHA.

    Q.4. FHA's Multifamily Program--Mr. Stevens, most of the focus
    on our mortgage market has been solely on the single-family
    side. However, over the last year we have seen increasing
    delinquencies on multifamily mortgages. Among securitized
    multifamily mortgages, delinquency rates have tripled over the
    last year.
        What is your view of the health of the multifamily mortgage
    market, and in particular, the financial health of FHA's
    Multifamily Programs?

    A.4. Just as with the single family and commercial markets, the
    multifamily market is not immune to the stresses of this
    economic environment. With the appointment of Carol Galante as
    the Deputy Assistant Secretary for Multifamily Programs, FHA
    will have the best leadership to help evaluate the current
    state of the multifamily mortgage market. Providing safe and
    available housing in the market depends on both a sound single
    family mortgage finance system and a strong multifamily market.
    If confirmed, I will work closely with Carol Galante to
    evaluate the current state of the market and identify areas of
    focus and opportunity in order to protect and improve the
    program going forward.
                                    ------

             RESPONSE TO WRITTEN QUESTIONS OF SENATOR BAYH
                         FROM DAVID H. STEVENS

    Q.1. As Assistant Secretary for Housing, HUD's manufactured
    housing program will fall under your jurisdiction. Can you
    assure the Committee that the full and proper implementation of
    the Manufactured Housing Improvement Act of 2000 will be a
    priority for you?

    A.1. The Manufactured Housing Improvement Act of 2000 provides
    valuable protections for consumers, and I will work hard to
    make sure that it is properly implemented. It is my
    understanding that the Act requires HUD to create the
    Manufactured Housing Consensus Committee, and to develop
    national programs for installation and dispute resolution. It
    is also my understanding that these key elements of the Act
    have been implemented. The Consensus Committee has been
    established, and the installation and dispute resolution
    programs are in place. The continued protection of consumers
    under the National Manufactured Housing Construction and Safety
    Standards Act of 1974 and the Manufactured Housing Improvement
    Act of 2000 will be a priority for me.

    Q.2. The Manufactured Housing Consensus Committee (MHCC) is the
    centerpiece reform of the Manufactured Housing Improvement Act
    of 2000. It was established to serve as an intermediary between
    the industry, consumers, and HUD. It has come to my attention
    that the independence of this committee is being adversely
    affected by restrictions placed on its functions, as well as
    the ability of its members to communicate and interact with
    program stakeholders and the public. Will you take steps to
    ensure the independence of the MHCC in fulfilling its statutory
    duties and purpose, as intended by the Congress?

    A.2. The MHCC is an advisory committee, subject to the
    protections and transparency requirements of the Federal
    Advisory Committee Act, and established to provide independent
    recommendations to the Secretary on certain aspects of the
    Manufactured Housing Program. I understand that the MHCC has
    participated in over 100 meetings since its creation and has
    provided valuable expertise and assistance to the Secretary on
    manufactured housing issues. I am not familiar with the details
    of any policies to restrict the committee's function, but
    nevertheless I would be concerned by any efforts to threaten
    its independence. If confirmed, it is my intention to ensure
    that the MHCC will continue to operate to fulfill its statutory
    duties and purpose and in accordance with the protections of
    the Federal Advisory Committee Act.

    Q.3. The Manufactured Housing Improvement Act of 2000 provides
    for the appointment of a noncareer official to serve as
    Administrator of HUD's manufactured housing program. However, I
    understand that this key position has often remained vacant,
    undermining the intent of Congress in establishing this role to
    serve as a liaison between the Department and the Manufactured
    Housing Consensus Committee. Upon your confirmation, will you
    commit to filling this position as quickly as possible?

    A.3. The Act provides funding for a noncareer Administrator to
    administer the manufactured housing program. This position has
    been filled in the past. While the appointment of an
    Administrator is not required by the Act, I feel that it is an
    important position and I will take a close look at this matter.
                                    ------

             RESPONSE TO WRITTEN QUESTIONS OF SENATOR CRAPO
                         FROM DAVID H. STEVENS

    Q.1. As FHA reserves continue to dwindle, what solutions do you
    propose to restore the reserves so that FHA continues to
    operate on a sound financial basis? Will you advocate for an
    appropriation? Will you increase premiums? If so, will they be
    front-end increases or annual during the life of the loan?

    A.1. As stated in my statement during the hearing, the first
    priority is to look into both the FHA product terms and lender
    behaviors in order to quickly identify areas of weakness in the
    program. At the present time, the FHA fund is solvent and meets
    actuarial requirements. Based on HPI (House Price Index) data,
    I do not see a short term need for any appropriation, and I am
    hopeful that this will be true for full year 2010. In terms of
    specific responses to improve the reserve, it will take three
    steps to occur in order to provide a more thorough answer.
    First, my confirmation will allow me to access all of the
    current risk data and the ability to assess staff capabilities
    and current mitigation efforts. Second, I will be able to
    assess loss expectations and incoming revenues from the newly
    insured business in order to quantify the net financial impacts
    to the fund. Third, we then will be prepared to make
    recommendations related to questions about premium increases,
    front-end increases, or other options. Please understand that
    credit risk management and actuarial soundness are my top
    priorities, and I pledge to focus here immediately, assuming I
    am confirmed.

    Q.2. The HUD Hope for Homeowners program has received very few
    applications and few banks have signed up to participate. What
    are your objectives with this program going forward?

    A.2. It is clear that Hope for Homeowners has not been
    successful to date. The core reasons for this relate to the gap
    in meeting the needs of homeowners and investor/servicers.
    Between the complex process requirements and the fairly strict
    restrictions in the initial program, it was unlikely from the
    outset that implementation would meet expectations from those
    who crafted the initial program. Pending legislation entitled
    ``Helping Families Save Their Homes Act of 2009'' (H.R. 1106),
    which was passed by the House and currently is pending in the
    Senate, has several specific improvements to the program that
    include simplification of the process and incentives for the
    servicers. This bill is a key part of improving the process. I
    believe also that servicers' motivation for solutions has grown
    with time, so the enactment of H.R. 1106 will meet a more eager
    and willing market to participate in this program as an option.
    At this time, I cannot formally engage in the dialogue with
    industry lenders to gauge the success of these changes, but I
    am confident that they are significant and will go a long way
    to improving performance of the program.

    Q.3. Are you intending to make additional changes to the RESPA
    rule?

    A.3. At this point the RESPA rule is something I support
    pending the resolution of concerns about a provision called
    ``required use.'' I believe the rule is a significant
    improvement in creating a more transparent disclosure process
    and set of documents that will protect consumers in the process
    of obtaining a mortgage loan for their home. Over time, there
    may be more changes needed, and I was very involved in the
    rulemaking process, having testified to a House committee in
    the fall of 2008, and promise to look closely at the current
    rule as well as any additional changes that may be needed in
    the very short term.
        I understand that HUD currently is in litigation
    challenging two aspects of the RESPA rule, the required use
    provision and the mandatory disclosure of broker compensation.
    I also understand that HUD is defending this litigation
    vigorously and believes that transparency is essential to
    protect consumers in making what is among the most significant
    purchases in their life.

    Q.4. How do you plan to use FHA authorities as well as working
    with Ginnie Mae to address the dramatic evaporation of
    warehouse credit line availability to FHA lenders?

    A.4. The issue of warehouse lines is significant and one that
    would affect the ability of this Nation to have a fully
    functioning, highly competitive mortgage market. In the absence
    of private market solutions, there needs to be consideration of
    a public solution as a minimum stop gap measure to protect
    hundreds of otherwise well-capitalized and responsible lenders
    in the market. I believe that FHA and Ginnie Mae should be more
    closely aligned within their respective authorities since the
    insurance and the financing of mortgage products are directly
    related to the ability to provide a liquid and competitive
    financing vehicle for consumers. Warehouse lending is a
    priority of Secretary Donovan, and I will be directly involved
    to help find a solution, if I am confirmed.
                                    ------

            RESPONSE TO WRITTEN QUESTIONS OF SENATOR CORKER
                         FROM DAVID H. STEVENS

    Q.1. Mr. Stevens, due to the challenges in the financial
    sector, hospitals that are looking to expand their facilities
    or construct new facilities that are needed in certain areas
    are unable to get the financing necessary for these projects. A
    HUD program commonly referred to as a Section 242 mortgage loan
    provides needed assistance to acute care hospitals. Currently,
    Section 242 loans are not available to psychiatric hospitals or
    physical rehabilitation hospitals that also serve important
    health care functions in Tennessee and around the country. I
    would appreciate your thoughts on the possibility of expanding
    these section 242 loans to hospitals beyond traditional acute
    care facilities.

    A.1. The authority for FHA's hospital mortgage insurance
    program is found in section 242 of the National Housing Act.
    The answer to your question may depend upon the extent to which
    section 242 provides authority for insuring mortgages secured
    by psychiatric hospitals and physical rehabilitation hospitals.
    If confirmed, I will review that authority with HUD attorneys
    and consult with hospital program administers in order to
    provide you with an informed response to your question.
                                    ------

            RESPONSE TO WRITTEN QUESTIONS OF SENATOR VITTER
                         FROM DAVID H. STEVENS

    Q.1. What checks and balances should be present between the
    Ginnie Mae functions and FHA?

    A.1. In virtually any mortgage investment business, the ties
    between the asset acquisition side and the securitization side
    are extremely close. The performance of the Ginnie Mae
    securities depends on the quality and duration of the assets
    that are pooled to form the security. Ginnie Mae needs to have
    a voice in the dialogue around programs and polices of
    mortgages used to back the securities simply to ensure that
    decisions are made on the best information available as FHA
    moves forward. If confirmed, I pledge to work much closer with
    Ginnie Mae to make sure that open and transparent information
    is available in order to make the most effective decisions.

    Q.2. Do you think TARP money should be used to facilitate Hope
    for Homeowners, including compensating subordinate lien holders
    so that they may be extinguished?

    A.2. The TARP funding guidelines are prepared by the Treasury
    Department, but I will look seriously at this issue, if
    confirmed, and would promise to respond to this question after
    that review.

    Q.3. Do you believe Hope for Homeowners should be terminated?
    If no, what should be the goals of a new program in its place?
    If yes, what actions will you take to ensure Hope for
    Homeowners works?

    A.3. No. The reasons for the low participation in the current
    program are due to complexity of process to the investors/
    servicers, confusing qualification guidelines to consumers, and
    adverse incentives. The program enhancements need to address
    these issues.
        Enactment of program improvements in H.R. 1106 would
    simplify the process, remove hurdles to consumers, and provide
    incentives to servicers. In addition, with more stress on
    portfolios, I believe servicers desire for the improvements
    will be higher now than perhaps when the program was first
    introduced, especially if H.R. 1106 is enacted.

    Q.4. How quickly do you plan to implement all aspects of last
    year's FHA modernization initiatives as well as the related
    systems and technology improvements?

    A.4. Assuming appropriations for technology enhancements are
    approved and assuming confirmation, I will work with all
    deliberate speed to evaluate and implement all improvements as
    quickly as possible, with prudent judgment and process.

    Q.5. Currently there is a moratorium on the implementation of
    risk-based pricing. How do you plan to implement risk-based
    pricing? How will the implementation of risk-based pricing
    affect the health of the FHA fund? How will the implantation of
    risk-based pricing affect the need for the FHA to request a
    credit subsidy from Congress?

    A.5. If confirmed and the statutory moratorium is not extended,
    I would review the data on which FHA based its decision to
    implement risk-based mortgage insurance premiums in order to
    determine what is the most prudent course of action, going
    forward, to expand participation in these programs while
    protecting the financial soundness of the mortgage insurance
    funds.

    Q.6. How do you plan to ensure that the multifamily group
    streamlines approvals for new loans, refinancing of old loans,
    and prepayments?

    A.6. If confirmed, I will work very closely with Carol Galante,
    FHA's new Deputy Assistant Secretary for Multifamily Programs,
    to evaluate the current state of the market and to identify
    areas of focus and opportunity in order to protect and improve
    the programs, including those involving loan prepayments as
    well as new loans and refinancing of existing loans.

    Q.7. On March 8, 2009, a Washington Post investigation led many
    observers to view the FHA as a ticking time bomb. The article
    reports, ``There has been a spike in quick defaults that seems
    to follow the pattern that preceded the collapse of the
    subprime market as some of the same flawed lending practices
    that contributed to the mortgage crisis are now eroding one of
    the main Federal agencies charged with addressing it.''
        According to the same article, ``more than 9,200 of the
    loans insured by the FHA in the past two years have gone into
    default after only no or only one payment.'' That is three
    times the rate of instant redefault as last year.
        How do you view the health of the FHA fund?
        As you know Congress has never had to appropriate money for
    the FHA insurance fund. Do you anticipate having to ask
    Congress for a credit subsidy? If so, how much would you expect
    to ask for?
        How do you view the affect of reverse mortgages (HECMs) on
    the program?

    A.7. At the present time, the FHA fund is solvent and meets
    actuarial requirements. Maintaining that solvency would be a
    top priority for me. If confirmed, I would immediately look at
    specific product terms of the FHA program against performance
    data to identify potential areas of adverse selection in order
    to create changes that may be needed for the program. Second, I
    would look into the quality of the seller pool by identifying
    outliers in the program and eliminating those with questionable
    capital or performance levels as a means to protect the fund
    from fraud or other adverse impact from low performers. Third,
    if confirmed, I would assemble a team to analyze revenues from
    the new business against loan loss data and work to create
    options, as needed, to strengthen the capital reserves of the
    fund. With respect to the HECM program with its increased
    volume of loans insured by FHA, I would ensure that steps
    described above would be taken to ensure program integrity
    while its benefits are made available to an increasing number
    of senior citizens.
                                    ------

             RESPONSE TO WRITTEN QUESTIONS OF SENATOR DODD
                            FROM PETER KOVAR

    Q.1. Improved Communications With Congress--Mr. Kovar, as you
    may recall from your time working with Mr. Frank, one of the
    hallmarks of the last HUD Administration was their lack of
    communications and transparency to Congress. This was very
    disappointing, because thoughtful oversight depends on having
    access to accurate and timely information about these programs.
    Can you assure us that you will be responsive to the Congress
    so that we can carry out our duties to the American public?

    A.1. One of my key responsibilities as the Assistant Secretary
    for Congressional and Intergovernmental Affairs is to ensure a
    commitment of responsiveness to Congress, State, and local
    governments and the American public. My emphasis on improved
    communications with Congress will not only include responsive
    and timely answers to Congressional inquiries and
    correspondence, but sufficient advance notice of key
    initiatives, and appropriate notification of grants and other
    HUD announcements that may affect members' districts and
    States. To achieve this objective, I plan to coordinate with
    HUD offices to ensure that Congressional inquiries are
    appropriately assigned and properly handled. In addition, as I
    mentioned in my testimony before the Committee, I would like to
    institute ``listening sessions'' in which senior HUD staff
    would make themselves available periodically to House members
    and Senators to discuss subject matters of interest to our
    Congressional partners.
        Fundamentally, I view the position for which I have been
    nominated as being focused on facilitating communication in
    both directions: from the Administration to Congress in order
    to ensure that the President's policies are fully understood by
    those who will be responsible for developing legislation to
    implement them, and from Congress to the Administration so that
    the views and concerns of the lawmakers are appropriately taken
    into account in developing those policies. As HUD's liaison to
    Congress, I will do everything I can to ensure the timely and
    responsive flow of information in both directions.
                                    ------

            RESPONSE TO WRITTEN QUESTIONS OF SENATOR SHELBY
                            FROM PETER KOVAR

    Q.1. HUD's Role in Disaster Relief--In the past decade, we have
    witnessed two devastating disasters inflicted upon our Nation:
    the terrorist attacks on 9/11 and Hurricane Katrina. In both
    instances HUD has been tasked with helping to rebuild. I know
    the rebuilding efforts in Alabama have been mixed, at best.
    Often funds have not reached those most in need nor have been
    distributed in a fair, timely, and equitable manner.
        Mr. Kovar, please share with the Committee your insights on
    improving HUD's efforts to assist in rebuilding after
    disasters.

    A.1. In the past few years, through the efforts of Federal,
    State, and local government staff, the groundwork has been laid
    for a sustained recovery in Louisiana, Mississippi, Texas,
    Alabama, and Florida. The State and City of New York, in
    concert with the Department, continue to address the
    devastation caused by the terrorist attack on 9/11. Yet, many
    challenges remain.
        I believe the most significant challenge is improving
    coordination of disaster response between Federal agencies and
    among the various levels of government: Federal, State, and
    local. Recent experiences have show how critical it is that
    roles be established to prevent duplication of efforts which
    often leave essential needs unmet. To the extent that there
    have been deficiencies in the response to disasters in the past
    in Alabama and elsewhere, I believe that has to some extent
    been a result of the challenges inherent in merging the
    activities of two or more agencies that have overlapping
    responsibilities. With this in mind, it will be important for
    HUD's future disaster response efforts to stress heightened and
    more efficient interagency cooperation, starting at the
    Secretarial level. Facilitating this improved coordination will
    be a key focus of mine if I am confirmed. This will include
    making certain that HUD staff maintain contact with their
    counterparts at other agencies, and that will also be a high
    priority of mine. If confirmed, I will also reach out to our
    partners at the State and local level to ensure that disaster
    responses are coordinated, and I pledge to work with your staff
    to help ensure that the agency carefully reviews any concerns
    you have specifically with regard to rebuilding in Alabama.
                                    ------

             RESPONSE TO WRITTEN QUESTIONS OF SENATOR DODD
                         FROM JOHN D. TRASVINA

    Q.1. The foreclosure crisis is wreaking havoc on communities
    across the country. Unfortunately, there is some evidence that
    minority communities were particularly targeted with predatory
    lending practices that are now contributing to threatened or
    actual foreclosures. If past is prologue, many of these
    communities may also be affected by mortgage rescue scams. In
    the FY2009 appropriations bill, Congress recently provided $2
    million to HUD's FHEO to combat mortgage rescue scams.
        What role can FHEO play in combating predatory practices
    that are continuing to affect our communities?

    A.1. Prosecuting lenders that prey on borrowers in this
    economic crisis is a high priority for this Department.
    Predatory scams continue to plague minority communities.
    Previously, predatory lenders would convince minority
    homeowners to obtain a high-cost subprime loan that the
    borrower could not afford or to refinance for home
    improvements. These scams have changed with the economic times,
    and predatory lenders now target borrowers in foreclosure or in
    danger of foreclosure, but the result is the same: minority
    homeowners lose their equity and often their homes, and
    minority communications are stripped of wealth. The Department,
    through its internal work force and fair housing programs, has
    the ability to combat these practices.
        The Department has the ability to bring these predatory
    lenders to justice. Within the Office of Fair Housing and Equal
    Opportunity, the Fair Lending Division is devoted to
    investigating cases of systemic discrimination by lenders. When
    its team of fair lending specialists and an economist has
    reason to believe that a lender may be discriminating, either
    through complaint patterns, HMDA data, or reports from the
    public, this Division also proposes Secretary-initiated
    investigations into discriminatory lending practices. When the
    Department finds a violation of the law, it will charge the
    lender in order injunctive relief and damages for the borrower.
        As Assistant Secretary, I will further enhance the capacity
    of the Fair Lending Division to investigste and bring fair
    lending cases. Investigators will communicate with consumer
    counselors and fair lending advocates and use their authority
    to investigate lenders that may be targeting mortgage abuse
    schemes to minority neighborhoods. At the same time, the Fair
    Lending Division will monitor and take appropriate action
    against conventionl lenders to ensure that their foreclosure
    and refinance procedures do not discriminate on the basis of
    race or national origin. A recent study by the Federal Reserve
    of San Francisco found that even after controlling for credit
    score and financial characteristics, an African American
    borrower was 3.3 times as likely as white borrowers to face
    foreclosure. Another study found that white borrowers were
    twice as likely as African American homeowners with similar
    financial characteristics to be approved for a refinance, even
    when they went to the same lender.
        Under my leadership, this Division will analyze foreclosure
    and refinance data to address discrimination in the refinance
    and modification of mortgages. As part of this effort, HUD has
    authorized the collection of data on race, ethnicity, and
    gender under the Administration's Home Affordable Modification
    Plan (``HMP''). Under HMP, servicers agree to alter the terms
    of existing mortgage loans in certain circumstances by a
    variety of means, including lowering interest rates, reducing
    principal, and extending repayment schedules. These data,
    together with information about the HMP benefits borrowers
    receive, will enable HUD and other government agencies to
    evaluate fair lending compliance of loan servicers.
        As you are aware, Congress provided the Department with an
    additional $2 million in FY2009 to address discriminatory
    foreclosure rescue scams through the Department's Fair Housing
    Initiatives Program (FHIP). This funding will assist
    organizations to combat mortgage rescue scams that target
    minorities or minority communities. The Depattment will seek
    additional resources in FY2010 to continue this effort and to
    combat other mortgage lending abuses. This effort will address
    both the fair lending violations and deceptive trade practices
    to provide the greatest possible relief for the borrower.
        The Department also takes seriously the necessity to
    increase consumer awareness in this area. All too often,
    binding legal documents are executed before consumers know
    their rights, making correction of the problems all the more
    difficult. HUD educates consumers regarding the dangers of
    predatory lending and how to avoid them, as well as the legal
    remedies available to those who have fallen (or may fall) prey
    to predatory lending. HUD's webpage, Public Service
    Annoucements, and brochures provide information on how to file
    a fair lending complaint, HUD fair lending studies, subprime
    lending, predatory lending, and minority homeownership. As
    Assistant Secretary, I will continue the production of the
    materials and expand their availability in languages other than
    English.
        I am keenly aware that the Office of Fair Housing and Equal
    Opportunity is not working in a vacuum. As Assistant Secretary,
    I will emphasize greater communication with the other HUD
    offices and improve coordination with entities outside of the
    Department, including banking regulatory agencies, the
    Department of Justice and the Federal Trade Commission, and
    State Attorneys General. This will not only allow us to
    coordinate our investigations, but also share tactics and
    techniques for bringing these lenders to justice. I will also
    emphasize the importance of open communication with fair
    housing organizations. The front-line assistance provided by
    these organizations makes them an invaluable resource for
    referrals and information regarding discriminatory lenders in
    their communities.
        In this economic climate, it is critical that the
    Department not simply wait for the homeowners to come to us. We
    will call upon fair housing organizations and other trusted
    organizations within minority communities for their assistance
    and expertise to reach those most affected by the foreclosure
    crisis. I plan to conduct extensive outreach across the country
    to inform homeowners of the resources and relief available to
    them in FHEO and throughout the Department. But we will do more
    than inform them; I hope to be able to provide on the spot
    assistance and referrals for homeowners in one location, to
    ease what is without a doubt a complicated process of
    navigating the different assistance available to them.
        Through these various efforts, the Department can provide
    assistance and justice to minority homeowners who are targeted
    for predatory mortgage abuse schemes.
                                    ------

           RESPONSE TO WRITTEN QUESTIONS OF SENATOR MENENDEZ
                         FROM JOHN D. TRASVINA

    Q.1. Improving Enforcement of the Fair Housing Act--Forty years
    after the passage of the Fair Housing Act, our Nation remains
    highly segregated and housing discrimination continues almost
    unchecked. Of the more than 4 million estimated fair housing
    violations annually, only 29,300 complaints were processed in
    2008. Of these, HUD's Office of Fair Housing and Equal
    Opportunity (FHEO) handled 2,123 cases, charged only 48 cases
    and has not addressed continuing systemic discrimination
    nationwide. These numbers are tragically low. HUD has the
    primary responsibility of enforcing our fair housing laws.
        What is your position on HUD's complaint processing load?
    What steps would you take to bolster FHEO's investigative
    strategies so that it addresses all types of discrimination and
    works toward developing systemic cases that effectively combat
    discrimination and promote inclusive communities?

    A.1. The Office of Fair Housing and Equal Opportunity (FHEO)
    must provide the leadership in a coordinated effort to promote
    fair housing and to combat housing discrimination. The
    complaint processing system is but one measure of the success
    and effectiveness of this effort. I agree with your view, and
    that of leaders among fair housing and civil rights experts,
    that 48 charges on an annual basis is disappointingly low. At
    the same time, it is important to note that the statutory
    requirement to promote conciliation--which is successful in
    approximately 30 percent of complaints--often obviates the need
    to file a charge in order to provide relief to a discrimination
    victim. As Assistant Secretary, I will examine this area
    thoroughly, including the vital work conducted by FHEO and its
    partners among nonprofit fair housing groups and Fair Housing
    Assistance Program agencies and others to prevent housing
    discrimination. As Assistant Secretary, I will undertake an
    evaluation of the effectiveness of current procedures and seek
    ways to promote vigorous enforcement of the laws.
        It is important to note that the share of housing
    discrimination cases handled by HUD will remain comparatively
    small compared to the caseload of State and local agencies. As
    you know, the Fair Housing Act requires that HUD refer
    complaints to State and local agencies in jurisdictions that
    enforce State and local laws that are substantially equivalent
    to the Federal Fair Housing Act. It is a reflection of the
    national commitment to eliminate discriminatory housing
    practices that 110 jurisdictions enforce substantially
    equivalent fair housing laws that cover 39 States and more than
    85 percent of the population. As a result, the number of
    complaints received by FHEO does not fully reflect its impact
    on combating housing discrimination.
        Another measure of HUD's effective use of the tools to
    combat housing discrimination is Secretary-initiated actions.
    Secretary-initiated investigations and complaints may result
    from matters that were otherwise resolved by the parties
    through the required conciliation process but where
    conciliation does not adequately advance the public interest to
    combat discrimination. Information received through complaint
    investigations or otherwise can and should lead to Secretary-
    initiated actions where appropriate. I will work to strengthen
    the Department's existing and new relationships with private
    nonprofit fair housing organizations whose community
    involvement and innovative techniques can help the Department
    develop more cases with strong evidence.
        Finally, in order to address the full extent of harm to
    victims of discrimination, I hope to improve FHEO's
    coordination with Federal, State, and local agencies, such as
    the Department of Justice, the Federal Trade Commission, the
    Federal Deposit Insurance Corporation and other banking
    regulators, and State Attorneys General.

    Q.2. Promoting Public-Private Partnership--A recommendation of
    the bipartisan National Commission on Fair Housing and Equal
    Opportunity report is that funding for the Fair Housing
    Initiatives Program (FHIP) should begin at $52 million. And in
    order to create a strong presence in our Nation's communities,
    FHIP eventually should support full funding of private fair
    housing organizations to conduct enforcement activity in each
    of the 363 Metropolitan Statistical Areas, at a cost of
    approximately $109 million per year.
        In addition to funding, FHIP should fund, as required by
    Congressional mandate, an annual comprehensive national media
    campaign to educate consumers about how to recognize and report
    housing discrimination, and to promote inclusive communities
    and an understanding of the benefits of neighborhood diversity.
    FHIP should also incorporate a regional or national systemic
    investigation component in addition to the systemic work done
    on the local level.
        Do you support these recommendations? What steps will you
    take as Assistant Secretary of FHEO to address the needs of
    local fair housing organizations and promote a meaningful
    partnership with local fair housing groups in order to create
    thoughtful, creative actions to address long-entrenched
    patterns of segregation and new forms of discrimination in the
    housing, lending, and insurance marketplaces?

    A.2. The National Commission on Fair Housing and Equal
    Opportunity provided national attention and nonpartisan
    expertise to the cause of fair housing. I have enormous respect
    not only for the contributions of its co-chairs, former HUD
    Secretaries Jack Kemp and Henry Cisneros, but for the day-to-
    day and sustained efforts of the many fair housing and civil
    rights organizations and leaders that were involved with the
    development of the report. I was pleased to have hosted the
    Commission's hearing in Los Angeles at the headquarters of the
    Mexican American Legal Defense and Educational Fund. Thus, I
    can assure you that I have and will continue to review closely
    the recommendations of the Commission and those of the many
    experts who testified before it.
        The public interest is greatly benefitted when trusted and
    established local and other organizations are in a position to
    assist victims of housing discrimination in learning about
    their rights and responsibilities under the law and the process
    to file a fair housing complaint. The Department's Fiscal Year
    2010 budget for the Fair Housing Initiatives Program (FHIP)
    will reflect the Administration's commitment to FHIP and its
    position on an appropriate level of funding for FHIP.
        As part of its FHIP funding for fair housing organizations,
    the Department makes available approximately $7,000 to each
    organization to defray its costs in pursuing training to
    promote creative and innovative investigative techniques. The
    Department has encouraged the FHIP organizations to enroll in
    courses at the Department's National Fair Housing Training
    Academy. FHIP groups may also use those funds to pursue other
    training opportunities. Additionally, every 2 years, the
    Department hosts a fair housing policy conference that brings
    together fair housing organizations and State and local fair
    housing agencies to exchange thoughtful and creative approaches
    to addressing housing discrimination. Under my leadership, FHEO
    will continue to partner with FHIP organizations to promote
    greater innovation in combating housing discrimination as the
    nature of discrimination evolves, and I will seek their
    valuable expertise in assisting the Department in education,
    outreach, and other roles.

    Q.3. Promoting Fair Housing Across the Federal Government--In
    order to build, sustain, and grow strong, stable, diverse
    communities, we need leadership that coordinates fair housing
    policy and practice across all Federal programs. One of the
    basic principles in the Fair Housing Act is that the Federal
    government, and all of its programs and activities, must take
    proactive steps to advance fair housing, not just to avoid
    discriminating.
        How do you see FHEO's role in advancing fair housing? How
    would you work within FHEO and HUD to promote diverse inclusive
    communities and advance fair housing throughout the Federal
    government's programs?

    A.3. Affirmatively furthering fair housing is a critical
    priority of the Department. And, as you well know, Senator, the
    Fair Housing Act charges all executive departments and agencies
    to carry out and administer their programs and activities
    relating to housing and urban development in a manner
    affirmatively furthering the Act's purposes. Secretary Donovan
    has declared his commitment to affirmatively further fair
    housing in several public addresses. For example, at the April
    1, 2009, opening event at HUD observing the 41st anniversary of
    the Fair Housing Act, Secretary Donovan set clear priorities
    for HUD to build diverse and inclusive communities and to
    advance fair housing in all Federal programs. He said that,
    ``Our successes in ensuring equal housing opportunity for all
    Americans demand an unprecedented level of collaboration,
    cooperation, and communication between HUD, other Federal
    agencies, State and local government, and community agencies.''
        I support this position, and if confirmed, I will carry out
    these goals by working closely with the leadership of other HUD
    programs, recipients, and other Federal agencies to see that
    the Department in its programs and the States and localities
    that receive Federal funds go beyond mere compliance and take
    proactive steps to further the goals of fair housing.
        One important strategy to deploy is formally partnering
    with Federal agencies to promote fair housing. The seed of
    partnership was planted when Secretary Donovan signed a
    Memorandum for Understanding with Secretary LaHood of the
    Department of Transportation to help American families gain
    better access to affordable housing, more transportation
    options, and lower transportation costs. The average working
    American family spends nearly 60 percent of its budget on
    housing and transportation costs, making these two areas the
    largest expenses for American families. Secretaries Donovan and
    LaHood want to find ways to cut these costs by focusing their
    efforts on creating affordable, sustainable communities.
    Secretary Donovan stated that, ``This partnership furthers fair
    housing goals by taking steps to remedy the problems caused by
    concentrations of poverty across the country, and to give all
    Americans equal housing choice.''
        I also will review Executive Order 12892, ``Leadership and
    Coordination of Fair Housing in Federal Programs: Affirmatively
    Furthering Fair Housing,'' to determine whether the President's
    Fair Housing Council should be convened to coordinate cross-
    agency collaboration to support fair housing.

    Q.4. The Fair Housing Act's statutory obligation to act
    affirmatively to further fair housing that applies to Federal
    programs and activities has not been enforced to promote strong
    and diverse communities. The Federal government's three largest
    Federal housing programs (Section 8, public housing, and the
    Low Income Housing Tax Credit) serve more than 4.5 million
    families and yet do very little to further fair housing and, in
    some cases, work to create and/or maintain segregated housing
    patterns.
        As Assistant Secretary of FHEO, would you support issuing a
    new regulation giving HUD more authority to address failures in
    affirmatively furthering fair housing by recipients of its
    funding?

    A.4. I believe that this is an important issue that requires
    serious thought and consideration. Currently, HUD regulations
    require recipients to sign certifications to affirmatively
    further fair housing. These regulations provide HUD the
    authority to question the certifications if the recipients do
    not show evidence that they have promoted fair housing. HUD
    also has the authority to take adverse legal action against
    jurisdictions that are directly involved in discrimination and/
    or fail to affirmatively further fair housing.
        If confirmed, I will explore what steps would best
    implement the Department's mandate to affirmatively further
    fair housing.

    Q.5. Fair Housing and the Foreclosure Crisis--The current
    mortgage crisis has its roots in decades of discriminatory
    housing and lending practices. When traditional lenders would
    not lend in communities of color, exploitative predatory
    lenders filled the gap, causing an unprecedented loss of wealth
    to those communities.
        Given this, it is critical that the solutions that have
    been proposed to address our current mortgage crisis comply
    with the mandate that all government housing and lending
    programs affirmatively promote fair housing. In the foreclosure
    context, this means assessing the racial impacts of alternative
    plans and seeking approaches that are racially and ethnically
    inclusive--approaches that do not further segregate and isolate
    low-income communities of color, but rather promote diverse
    neighborhoods.
        What role do you think FHEO should play in addressing
    discrimination and segregation as part of its response to the
    foreclosure crisis? More specifically, what steps will you take
    to ensure that the Troubled Assets Relief Program (TARP) for
    which HUD is on the oversight board and Neighborhood
    Stabilization Program that is administered by HUD will be
    implemented with full attention to the requirement to
    affirmatively further fair housing? As Assistant Secretary of
    FHEO, how would you reform HUD's fair lending programs to
    assure that discrimination in lending is addressed?

    A.5. Prosecuting lenders that prey on borrowers in this
    economic crisis is a high priority for this Department in
    general and the Office of Fair Housing and Equal Opportunity
    (FHEO) in particular. Predatory scams continue to plague
    minority communities. Previously, predatory lenders would
    convince minority homeowners to obtain a high-cost subprime
    loan or refinance for home improvements that the borrower could
    not afford. These scams have changed with the economic times,
    and predatory lenders now target borrowers in foreclosure or in
    danger of foreclosure. Nevertheless, the result is the same:
    minority homeowners lose their equity and often their homes,
    and minority communities are stripped of wealth. The
    Department, through its internal work force and fair housing
    programs, has shared responsibility to combat these practices.
        If confirmed, I will seek to enhance the capacity of the
    Fair Lending Division to investigate and identify fair lending
    cases. Moreover, regarding the Neighborhood Stabilization
    Program (NSP), HUD is ensuring that the requirement to
    affirmatively further fair housing is fully incorporated into
    the notices and notices of funding and availability carrying
    out its operations NSP and NSP II are likely to operate in
    neighborhoods targeted by mortgage fraudsters on the basis of
    race, national origin, or age. Mortgage fraud schemes have
    evolved to take advantage of new funding sources and avoid
    detection, and it is likely that the perpetrators will seek to
    exploit programs like the NSP and the persons who would benefit
    from such programs. HUD and its grantees must remain vigilant
    to investigate and prosecute such frauds, and FHEO will
    undertake outreach and education to prevent exploitation and
    bring vigorous enforcement actions against acts of illegal
    discrimination where they may occur.
        Furthermore, as you are aware, Congress provided the
    Department with an additional $2 million in FY2009 to address
    discriminatory foreclosure rescue scams through the
    Department's Fair Housing Initiatives Program (FHIP). This
    funding will assist organizations to combat mortgage rescue
    scams that target minorities or minority communities.
        The Department also takes seriously the necessity to
    increase consumer awareness in this area. All too often,
    binding legal documents are executed before consumers know
    their rights, making correction of the problems all the more
    difficult. HUD educates consumers on the dangers of predatory
    lending and how to avoid them, as well as the legal remedies
    available to those who have fallen (or may fall) prey to
    predatory lending. HUD's webpage, Public Service Announcements,
    and brochures provide information on how to file a fair lending
    complaint, HUD fair lending studies, subprime lending,
    predatory lending and minority homeownership. As Assistant
    Secretary, I will continue the production of these materials
    and expand their availability in languages other than English.
        I am keenly aware that the Office of Fair Housing and Equal
    Opportunity is not working in a vacuum. If confirmed, I will
    emphasize greater communication with the other HUD offices and
    improve coordination with entities outside of the Department,
    including banking regulatory agencies, the Department of
    Justice, the Federal Trade Commission, and State Attorneys
    General. This will not only allow us to coordinate our
    investigations, but also share tactics and techniques for
    bringing these lenders to justice. I will also emphasize the
    importance of open communication and collaboration with fair
    housing organizations. The front-line assistance provided by
    these organizations makes them an invaluable resource for
    referrals and information regarding discriminatory lenders in
    their communities.
        Through these various efforts, the Department can provide
    meaningful assistance and justice for minority homeowners whose
    fair housing rights have been violated.

    Q.6. Limited English Proficiency Issues--In the Summer of 2007,
    a coalition of multifamily industry stakeholders, and civil
    rights advocates agreed to legislative language which would
    allow HUD to better serve persons with limited proficiency in
    the English language by providing technical assistance to
    recipients of Federal funds. This language was included in both
    of the Section 8 Voucher Reform Act (SEVRA) bills introduced in
    the House and Senate (H.R. 1851, S. 2684). I also introduced
    this legislation as a free standing bill (S. 2018). Some of the
    key parts of this authorization bill would have:

        Created a task force of industry and civil rights
            stakeholders to identify vital documents (to include
            both official HUD forms and unofficial property
            documents);

        Required HUD to translate the vital documents
            within 6 months;

        Created a HUD-administered 1-800 hotline to assist
            with oral interpretation needs; and

        Authorized appropriations.

        Although these bills were not enacted before the 110th
    Congress adjourned, I anticipate they will be reintroduced in
    this Congress.
        As Assistant Secretary of Fair Housing and Equal
    Opportunity, would you recommend that the Administration
    support legislation identical to S. 2018 (from the 110th
    Congress)? Please explain the rationale you would offer to
    support your recommendation.

    A.6. If confirmed, I would like to work closely with you and
    your staff to ensure full protection of the law for all
    individuals without regard to their level of proficiency in
    English and to ensure meaningful access for such individuals to
    HUD programs and the programs of HUD funding recipients. This
    is an area of the law I have worked on for the past 30 years
    and will continue to do so.

    Q.7. Please explain where HUD stands in its effort to translate
    important documents to support the multifamily housing and
    public housing programs. I am interested to know:

        Which documents has HUD already provided to support
            these programs?

        Which documents are in the process of being
            translated, which languages are being provided and when
            will HUD make them available to the public?

        Which documents does HUD plan to translate, which
            languages will be provided, and what is the expected
            timeframe for completing action on these documents?

        As Assistant Secretary of Fair Housing and Equal
            Opportunity, what actions will you take to ensure HUD
            makes translated documents available for use in a
            timely manner?

    A.7. As Assistant Secretary, I will work to ensure that
    language service requirements are coordinated within HUD,
    industry groups, and recipients, on a timely basis. HUD has
    translated a total of 27 vital documents into 15 different
    languages. Each of the documents has been translated into one
    or more of the following languages: Amharic, Arabic, Armenian,
    Chinese, Farsi, French, Hmong, Khmer, Korean, Portuguese,
    Russian, Somali, Spanish, Tagalog, and Vietnamese. More
    specifically, HUD has translated four separate model leases for
    the Multifamily Housing Program into 13 languages; the
    ``Resident Rights and Responsibilities'' brochure into 13
    languages; the ``Protect Your Family From Lead in Your Home''
    brochure into 10 languages; and the ``Housing Discrimination
    Complaint Form'' into seven languages.
        I understand that HUD is reviewing what other vital
    documents should be translated and what target languages are
    most urgently needed.
        The translated documents will be available on the HUD Web
    site (www.hud.gov/lep) by mid-May.
        HUD will continue to support the LEP Initiative by
    continuing to provide written translations of vital documents,
    continuing to provide oral interpretation phone services, and
    collaborating with other Federal agencies.
                                    ------

            RESPONSE TO WRITTEN QUESTIONS OF SENATOR VITTER
                         FROM JOHN D. TRASVINA

    Q.1. The previous Administration succeeded in forcing the
    Philadelphia Housing Authority to commit to a plan that would
    bring its buildings closer to compliance with the Fair Housing
    laws. Are you aware of whether or not the Housing Authority has
    already breached that agreement? If they have breached the
    agreement, or breach it in the future, how do you plan to
    address this high-profile fair housing issue?

    A.1. It is critical that recipients of Federal funds ensure
    that their programs, facilities, and housing are available
    without regard to diasbility.
        I am not in a position to know whether the Philadelphia
    Housing Authority (PHA) is in breach of its October 2008
    agreement with HUD. However, in order to ensure compliance, I
    plan to work with PHA in a cooperative manner, in that FHEO
    would not wait to take action until full breach or default has
    taken place. Instead, as with any housing authority with whom
    there is an agreement under Section 504, I will see that FHEO
    reviews the periodic submissions for any action, anticipated or
    unanticipated, that could lead to a later breach or default,
    and immediately works cooperatively to avoid an actual breach
    or default. I plan to continue this method with PHA.
        If the Department is not satisfied with the housing
    agency's efforts to cure a default, under the terms of the
    agreement, the Department may impose a schedule of actions and/
    or a management plan to complete the activities specified in
    the agreement, take appropriate action under HUD's regulations,
    or impose sanctions as specified in the agreement.
                                    ------

             RESPONSE TO WRITTEN QUESTIONS OF SENATOR DODD
                          FROM DAVID S. COHEN

    Q.1. Iran--Mr. Cohen, our Iran policy is currently framed by
    three layers of sanctions--(1) a trade embargo; (2) targeted
    financial measures, shutting off the global banking system to
    specific persons; and (3) the threat of penalties against
    foreign companies that do energy business in Iran.
        Even as the Administration explores possible diplomatic
    channels, how should Treasury continue to maintain pressure to
    combat Iran's terrorist support and nuclear proliferation?

    A.1. In my view, enhanced vigilance of Iranian financial
    institutions remains critical in our effort to prevent Iran
    from making further progress on its nuclear program and
    preventing its support of terrorism. If confirmed, I would be
    assisting in holding Iran responsible for its actions by
    joining Treasury's efforts to conduct intensive public and
    private sector outreach to warn governments and global
    financial institutions of the risks of doing business with
    Iran; maintaining the close dialogue established with our key
    partners in Europe, Asia, and the Middle East; extending our
    outreach to less traditional financial centers that may be
    increasingly vulnerable to Iran's illicit financial activities;
    and coordinating Treasury's policy around efforts to detect,
    disrupt and prevent the financing of terror and nuclear
    proliferation.

    Q.2. How would you characterize current U.S. policy toward
    Iran? What is the Department of the Treasury's appropriate role
    in formulating and enforcing such a policy?

    A.2. I understand that the Administration's policy review on
    Iran is ongoing, so it would be difficult to comment in any
    detail about the current U.S. policy. However, the President
    has been clear that the U.S. is pursuing engagement with Iran
    and, at the same time, will continue to hold Iran responsible
    for its actions. Within this context, I look forward, if
    confirmed, to working vigilantly to ensure that Treasury
    applies the full range of its authorities as necessary to
    address Iran's illicit conduct and protect the international
    financial system from Iranian abuse, and encourage our
    international partners to remain vigilant and take steps
    necessary to guard against the risks posed by Iran.

    Q.3. Are additional authorities needed to strengthen U.S.
    sanctions on Iran?

    A.3. The Treasury Department has a robust set of authorities to
    combat illicit activity by Iran. If confirmed, I will
    concentrate on ensuring that those authorities are used in the
    most effective and appropriate way to advance our national
    security and foreign policy objectives. I am not in a position
    at the this time to assess whether any additional authorities
    are needed, but if I am confirmed I will work with Congress to
    consider the utility of new or enhanced authorities to combat
    the financing of terrorism, weapons proliferation, narcotics
    trafficking, or other threats to the national security and
    foreign policy interests of the United States, whether
    emanating from Iran or elsewhere.

    Q.4. Transnational Threats--Some of the most egregious
    international crimes are funded via the least advanced
    financial networks. America's adversaries--from al Qaeda
    terrorists and Somali pirates to Mexican smugglers and
    launders--exploit informal ``value transfer systems'' such as
    Hawalas. This Committee modernized the 1970 Bank Secrecy Act to
    arm Treasury with additional intelligence-sharing tools, in
    part, to target these networks under Title III of the 2001 USA
    PATRIOT Act.
        Please describe how these additional tools may be used to
    combat threats posed by ``transnational'' organizations that
    are transmitting funds throughout the world outside of the
    traditional international financial system?

    A.4. I agree that many of our most dangerous adversaries
    develop or exploit informal financial networks to fund their
    operations and finance their organizations. The modernization
    of the Bank Secrecy Act has provided Treasury with authorities
    that continue to be essential to their ongoing efforts to
    combat such illicit use of informal financial networks. In
    general, I believe that these authorities have proven to be
    essential by strengthening and expanding Bank Secrecy Act
    regulatory requirements to promote transparency and
    accountability across the financial system, including across
    informal value transfer systems that operate as money services
    businesses; and providing new information-sharing channels
    between and among financial institutions and law enforcement
    about persons, accounts and transactions of particular concern,
    including those related to informal financial networks. In
    addition, the USA PATRIOT Act strengthened Treasury's ability
    to designate terrorist financiers--including those operating
    informal financial networks--by clarifying our authority to
    protect classified information required to support designation
    from public disclosure.
        If confirmed, I will support the use of these and other
    critical tools that the Congress has provided in order to
    protect the international financial system from all forms of
    illicit finance and to identify and disrupt illicit financing
    networks through targeted action.

    Q.5. What would be your goals for promoting greater
    international cooperation in this area?

    A.5. If confirmed, I would seek to promote greater
    international cooperation in this area by following through on
    the existing strategies of promoting a greater understanding of
    how terrorist organizations and other transnational criminal
    groups develop or exploit informal financial networks to
    finance their operations; strengthening implementation of
    international standards that subject informal value transfer
    systems to financial regulation and supervision; and targeting
    transnational illicit financing networks that evade or attempt
    to operate within applicable financial regulatory frameworks
    for enforcement action.

    Q.6. Bank Reporting--Under the Bank Secrecy Act, banks are
    required to file with the Department of the Treasury suspicious
    activity reports (SARs) on customers possibly engaging in
    illegal activity and Currency Transaction Reports (CTRs) for
    certain large cash transactions.
        Many businesses are exempt from having banks file CTRs on
    them. Are these exemptions adequate? Is regulatory relief
    needed in this area? If so, what approach should the Department
    take, without compromising our efforts to combat money
    laundering and terrorist financing? Do you share law
    enforcement's concerns over certain proposals for regulatory
    relief?

    A.6. In December, FinCEN issued a rule that simplified the
    requirements for financial institutions to exempt their
    eligible customers from currency transaction reporting. The new
    rule introduced a number of changes designed to make it easier
    for depository institutions to exempt low-risk customers from
    the CTR filing requirement. I understand that these changes are
    consistent with the recommendations of the GAO's February 2008
    report on CTRs. At present, I believe it would be prudent to
    monitor the impact of these simplified requirements before
    concluding that additional regulatory relief is needed in this
    area, but, if confirmed, I will be especially attentive to the
    need to carefully weigh the cost imposed by the recordkeeping
    and reporting rules against the benefit of the information
    obtained by law enforcement.

    Q.7. How should the Department of the Treasury prevent banks
    from stripping identifying information from international wire
    transfers to avoid U.S. government scrutiny?

    A.7. The Treasury Department is working with the law
    enforcement, regulatory, and intelligence communities, as well
    as with international counterparts and the international
    banking industry, in a coordinated effort--including outreach,
    the development of international standards, and, when
    necessary, law enforcement action--to prevent banks from
    stripping identifying information from international wire
    transfers. If confirmed, I would work to continue these
    efforts.
                                    ------

            RESPONSE TO WRITTEN QUESTIONS OF SENATOR SHELBY
                          FROM DAVID S. COHEN

    Q.1. Compliance Penalties/TARP--To address significant
    weaknesses in their financial condition, hundreds of financial
    institutions have received billions of dollars through
    government programs.
        Mr. Cohen, do you believe firms could use TARP funds to pay
    compliance fines?

    A.1. Funds provided to institutions under the TARP program are
    designed to strengthen TARP recipients' balance sheets, so that
    they are in better position to extend credit to American
    families and businesses. I understand that determining
    precisely which funds a TARP recipient might use to pay
    compliance fines would be difficult.

    Q.2. In the case of institutions in weak financial condition,
    will Treasury reduce a fine or even agree to put it off?

    A.2. The responsibility to assess civil money penalties or
    other fines for violations of regulations issued by the
    Treasury Department's Financial Crimes Enforcement Network
    (FinCEN) and the Office of Foreign Assets Control (OFAC) has
    been delegated to Directors of those organizations. In the
    normal exercise of their enforcement discretion, the Directors
    of OFAC and FinCEN take into account a variety of factors,
    including the financial condition of the violator, in imposing
    a sanction. Nevertheless, I am confident that the Directors of
    OFAC and FinCEN expect that all persons and entities subject to
    these rules fully comply with the law irrespective of their
    financial condition, and will not excuse noncompliance by firms
    encountering financial distress.

    Q.3. Cross-Border Wire Transfers--Mr. Cohen, I understand that
    an OMB hold was placed on a proposed FinCEN regulation
    requiring reporting on Cross-Border Electronic Funds
    Transmittals.
        What can you tell us of the status of that proposed
    regulation and of the broader concept itself, today?

    A.3. My understanding is that FinCEN, responding to direction
    from Congress, prepared an October 2006 study entitled
    ``Feasibility of a Cross-Border Electronic Funds Transfer
    Reporting System Under the Bank Secrecy Act,'' that concluded
    that it is feasible to require the reporting of information
    that is currently required to be recorded. The next step,
    including whether to issue a notice of proposed rulemaking, is
    subject to internal review by the Department of the Treasury.
    If confirmed, I will promptly turn my attention to that review.

    Q.4. General Terrorist Designations--Mr. Cohen, in your
    opinion, what is Treasury's most effective tool for dealing
    with terrorist activity?

    A.4. In my opinion, Treasury's most effective tool for dealing
    with terrorist activity, as with all illicit threats to our
    national security, will continue to be the Office of Terrorism
    and Financial Intelligence (TFI), which integrates and marshals
    Treasury's authorities, resources, and expertise against the
    national security threats that we face. The tools that I expect
    to assist in deploying, if I am confirmed, include:

        Targeted action against terrorist organizations or
            their support networks, such as through designation
            pursuant to Executive Order 13224 or through sensitive
            dissemination of targeted information requests to U.S.
            financial institutions pursuant to Section 314(a) of
            the USA PATRIOT Act;

        Systemic action against terrorist financing risks,
            such as designation and the imposition of protective
            measures pursuant to Section 311 or the issuance of
            advisories to U.S. financial institutions;

        International engagement with jurisdictions of
            particular importance in combating terrorist financing;
            and

        Outreach to the private sector, including the
            financial community and charitable sector, especially
            when operating in high risk regions where terrorist
            organizations are particularly active.

    Q.5. How effective are sanctions, and sanctions lists against
    terrorists?

    A.5. In my opinion, sanctions--and particularly targeted
    financial sanctions against designated or listed parties--have
    proven to be an increasingly important tool in combating the
    full range of illicit national security threats that we face,
    including not only terrorism, but also threats such as WMD
    proliferation, rogue regimes such as in Zimbabwe and the Sudan,
    and drug trafficking kingpin organizations. Targeted financial
    sanctions have successfully disrupted and deterred terrorists
    and other threats to our national security by raising the
    costs, risks, and difficulties associated with the targeted
    illicit activity.
        I believe that targeted financial sanctions have become an
    increasingly effective tool primarily because:

        Sanctions have evolved from broad-based,
            jurisdictional programs to targeted ones that focus
            specifically on the illicit conduct at issue. This
            evolution has allowed Treasury to focus on the specific
            threats faced by the United States, while reducing
            negative collateral consequences to innocent third
            parties, which in turn facilitates greater support from
            financial institutions, partner countries, and the
            general public.

        Many of the national security threats that we
            face--including WMD proliferation, money laundering,
            drug trafficking, corruption, and transnational
            criminal activity more broadly--are motivated by profit
            or financial greed. Targeted financial sanctions can be
            highly effective in attacking the financial gains of
            such illicit activity, and as such, they can have a
            highly disruptive and deterrent effect.

        All of the national security threats we face--
            including terrorist organizations, criminal
            organizations, and corrupt or rogue regimes--depend
            upon the financial system to raise, move, and use funds
            to support their nefarious interests. Targeted
            financial sanctions give us a tool to attack this
            common vulnerability by identifying and shutting down
            illicit actors that attempt to access the international
            financial system.

    Q.6. What is your general take on terrorist or ``black lists?''

    A.6. For fighting terrorism, lists comprised of persons and
    entities subject to sanction are essential to making targeted
    financial sanctions work. Without such lists, U.S. persons--
    including our financial institutions--would not know which
    particular individuals and entities are subject to sanction.
        For operational and compliance purposes, Treasury's Office
    of Foreign Assets Control (OFAC) has consolidated and maintains
    a current list (the list of Specially Designated Nationals, or
    SDN list) of all persons publicly designated pursuant to our
    targeted sanctions programs, including our counterterrorism
    sanctions program pursuant to Executive Order 13224. If
    confirmed, I will work with OFAC to ensure that we continue to
    maintain the integrity of the SDN List.
                                    ------

           RESPONSE TO WRITTEN QUESTIONS OF SENATOR MENENDEZ
                          FROM DAVID S. COHEN

    Q.1. The Treasury Department has played a key role over the
    past several years in ratcheting up the financial pressure on
    Iran over its illicit nuclear program and support of terrorism.
    For many years, the State Department has named Iran not only as
    the world's leading state sponsor of terror, but as the
    ``central bank for terrorism.'' President Obama has committed
    the United States to use all diplomatic, political, and
    economic steps--including direct engagement backed by the
    threat of tougher sanctions--to persuade Iran to turn away from
    its dangerous course.
        If Iran rejects offers to engage with the U.S. regarding
    its nuclear program or if that engagement fails to bear fruit,
    do you believe the Treasury Department will look to impose
    increased financial sanctions on Iran? What might those
    sanctions be?

    A.1. It is, of course, very difficult for me, as a nominee, to
    predict what course our policy will take if Iran rejects offers
    to engage with the U.S. regarding its nuclear program, but I
    note that during her recent testimony before the House Foreign
    Affairs Committee, Secretary of State Clinton said that the
    Obama Administration is ``laying the groundwork for . . . very
    tough . . . sanctions that might be necessary in the event that
    our offers are either rejected or the process is inconclusive
    or unsuccessful.'' Such sanctions, of course, would likely be
    administered by the Treasury Department, but it would be
    inappropriate for me to speculate on what the specific
    sanctions might be.

    Q.2. If confirmed will you fully enforce those sanctions
    already imposed related to Iran? If foreign banks continue to
    conduct business with Iranian banks sanctioned by the U.S. do
    you believe they should be held liable to sanctions?

    A.2. If confirmed, I plan to fully enforce the sanctions
    currently in place against Iran and those persons and entities
    affiliated with the Iranian government that are subject to
    sanctions for supporting terrorism, weapons proliferation,
    destabilizing the region, or otherwise. Moreover, if confirmed,
    I will work to ensure that any foreign bank that breaches our
    sanctions laws (whether with respect to Iran or otherwise) are
    subject to an appropriately severe penalty.

    Q.3. Do you believe the Obama Administration will sanction the
    Iranian Central Bank, an act that the Bush Administration never
    got off the ground?

    A.3. With all respect, I do not believe it is appropriate for
    me to speculate on any particular sanction that may be imposed.
    I can assure the Senate, however, that if confirmed, I will
    consider all appropriate sanctions.

    Q.4. What more can the U.S. do to cut off the financial
    assistance that Iran provides to Hamas and Hizballah?

    A.4. Iranian support for terrorism, including support for Hamas
    and Hizballah, is completely unacceptable, and has resulted in
    a number of designations of Iranian entities, including Bank
    Saderat. Although it would be inappropriate for me to speculate
    on what additional steps the Treasury Department might take to
    cut off Iranian financial assistance to Hamas and Hizballah, I
    can assure the Senate that, if confirmed, I will carefully
    assess what appropriate additional steps can be taken.

    Q.5. During the campaign, then-Senator Obama voiced support for
    sanctioning the export of refined petroleum products to Iran.
    This has always been an Achilles' heel for Iran because they
    are forced to import 40 percent of their natural gas supply.
    Does the administration intend to support such efforts and can
    these sanctions work in hitting Iran where it will hurt the
    most?

    A.5. With all respect, I do not believe it is appropriate for
    me to speculate on any particular sanction that may be imposed.
    I can assure the Senate, however, that if confirmed, I will
    consider all appropriate sanctions.
        Since the end of the 2006 Lebanon War, Hizballah has not
    only built up its power within the Lebanese government, but
    also rearmed itself well beyond the capabilities they had
    during the war. Iran and Syria continue to provide financial
    support for Hizballah, as well as assist with smuggling efforts
    to ensure that Hizballah is armed to attack Israel.

    Q.6. Can you discuss U.S. efforts to prevent the illicit arming
    and financing of Hizballah by Iran and Syria? What more do you
    think we should be doing to stop Hizballah?

    A.6. Since Hizballah's initial designation as a terrorist
    organization in 1995, the Treasury Department has been engaged
    in a wide-ranging effort to identify and disrupt its financial
    and material support networks, including its sources of support
    in Iran. Similarly, Treasury has used a variety of authorities
    to hold the Syrian regime accountable for its destabilizing
    behavior in the Middle East, including its support for
    terrorist groups such as Hizballah. If confirmed, I look
    forward to continuing Treasury's efforts to target Hizballah's
    global financial network and to holding states that support
    terrorist activity, such as Iran and Syria, accountable for
    their actions.

    Q.7. Hizballah has a very active fundraising network in South
    America, largely tied to the trade of illegal narcotics. If
    confirmed will you make it a priority to target Hizballah's
    activities in South America?

    A.7. Hizballah's efforts to raise funds in South America, and
    its connection to the illegal narcotics trade, are a cause for
    considerable concern. If confirmed, I will make Hizballah's
    activities in South America a priority.
                                    ------

            RESPONSE TO WRITTEN QUESTIONS OF SENATOR BUNNING
                          FROM DAVID S. COHEN

    Q.1. Mr. Cohen, are you aware of allegations that imports of
    stainless steel from China contain Cuban nickel, in violation
    of the United States' trade embargo with Cuba? In your
    potential role overseeing the Office of Foreign Assets Control,
    would you enforce U.S. law in this matter? Would you support
    requiring China to certify that there is no banned Cuban nickel
    in its stainless steel exports to the United States?

    A.1. I am aware of concerns that Cuban nickel is incorporated
    into stainless steel that is manufactured in third countries
    and subsequently exported to the United States. It is my
    understanding that the Office of Foreign Assets Control, as
    well as U.S. Customs and Border Protection, have been
    considering how best to address this issue to ensure that our
    Cuba trade sanctions are effectively enforced. If confirmed, I
    look forward to working with my colleagues in OFAC and Customs,
    as well as with the Congress, to address this issue.
                                    ------

            RESPONSE TO WRITTEN QUESTIONS OF SENATOR VITTER
                          FROM DAVID S. COHEN

    Q.1. Are you aware of Shariah Compliant Finance (SCF)? Please
    explain your understanding of what it is.

    A.1. Shariah Compliant Finance, which is also referred to as
    Islamic Finance, is a form of finance in which transactions are
    designed to avoid payment of interest, which I understand is
    prohibited by Islamic law. Islamic finance permits investors to
    receive profits in return for bearing specific commercial
    risks.
        Zakat is the Islamic principle of giving a percentage of
    one's income to charity. It is an obligation in the Qur'an that
    Muslims pay 2.5 percent of their yearly earnings to zakat.
    Every financial institution offering Islamic products appears
    required to donate 2.5 percent of revenue generated from them
    to zakat (charity). It is the norm that the shariah advisory
    board determines which charity should receive the donation,
    which means it is likely to be a Muslim charity.

    Q.2. Are there risks associated with zakat? It has been proven
    in cases like the Holy Land Foundation trial that radical
    Muslims use charities that are fronts for terrorist
    organizations. What is the risk of American dollars funding
    terrorism directly when American Muslims engage in zakat?

    A.2. Zakat, as I understand it, is the term used for the Muslim
    obligation to give alms to the poor through charitable giving.
    My understanding is that zakat is an obligation of individual
    Muslims, but not specifically a corporate obligation. Some
    Islamic financial firms, like many non-Islamic financial firms,
    also engage in charitable giving.
        Combating the misuse of charitable giving to fund terrorism
    or other illicit activity has been a key focus of the work of
    the Treasury Department, and it will remain so if I am
    confirmed. The Treasury Department has worked extensively with
    law enforcement to take action against those who would divert
    charitable contributions, of any kind, to fund terrorism or
    other illicit activities. The Treasury Department has an
    ongoing dialogue with the American Muslim community, working
    with the community to prevent abuse of charitable contributions
    collected by the community.

    Q.3. There is concern that Islamic finance will and is being
    used as a vehicle for sidestepping U.S. and international
    economic sanctions. For example, the Sudanese government
    reportedly issued Islamic bonds to Gulf investors in order to
    circumvent U.S. sanctions. Given the current situation with
    Iran and the push for economic sanctions, this would be a huge
    loophole and render any enforceable economic sanctions useless.
    How would you suggest Congress and the Administration address
    this issue?

    A.3. I am not familiar with what considerations may have driven
    Sudanese government to issue bonds in the fashion that it did,
    or whether an effort to sidestep U.S. and international
    sanctions imposed on Sudan motivated its actions. In any event,
    financial institutions that comply with Islamic law are subject
    to the same rules and regulations that govern any other
    financial institution, including the sanctions programs
    administered by OFAC and the antimoney laundering rules of
    FinCEN, the Federal banking regulators, and the securities
    regulators.

    Q.4. As you may have heard, the Treasury Department has been
    studying Shariah Compliant Finance (SCF) as a way to help ease
    the pain of the world financial crisis. Taking it a step
    further, the Treasury has hosted informational sessions on SCF
    to staff and the Presidential transition team. Do you believe
    that this was an appropriate practice for the U.S. Treasury
    Department? Do you plan on continuing the practice?

    A.4. I understand that the Treasury Department held a seminar
    in November 2008, in which industry practitioners and academics
    briefed regulators, policymakers, and members of the academic
    community about current developments in the Islamic finance
    industry. Treasury monitors developments in all sectors of the
    financial services industry on an ongoing basis, and routinely
    hosts seminars and attends industry events.

    Q.5. Zakat donations have recently decreased because observant
    Muslims in the U.S. do not know what charities they can trust
    and do not want to mistakenly fund terrorism. What
    recommendations would you make to the Treasury Department
    regarding this problem? How can the Treasury Department
    advocate this practice when Muslims trying to exercise freedom
    of religion are skeptical of the risks?

    A.5. The Treasury Department has worked closely with the
    Muslim-American community to educate the community about the
    risk that charitable donations may be misdirected to fund
    terrorism. It is a terrible tragedy when well-meaning Muslim
    Americans, who simply want to provide charity to those in need,
    are victimized by having their donations diverted to fund
    terrorists. I understand that as part of Treasury's
    comprehensive strategy to combat terrorist abuse of charities,
    Treasury has issued guidance, including the Anti-Terrorist
    Financing Guidelines: Voluntary Best Practices for U.S.-Based
    Charities, to assist all donor and charitable communities in
    understanding how terrorist organizations abuse the charitable
    sector and in adopting appropriate practices to protect against
    such terrorist abuse. If confirmed, I intend to work with my
    colleagues in the Treasury Department in advancing these
    efforts.

    Q.6. If there is a legitimate concern that American investors
    will unknowingly fund zakat resulting from SCF--what steps can
    Treasury take to educate investors of that fact? Would
    legislation that amends the money and finance section of the
    U.S. code to include the types of financial institutions that
    practice SCF and requires that all the businesses covered in
    that section be required to submit a list to the Financial
    Crimes Enforcement Network (FinCEN) of all charitable
    contributions made by the financial institution, during the
    preceding year for review by FinCEN provide additional, useful
    information to both law enforcement and investors? What would
    be problematic about such an approach?

    A.6. I am not aware of any particular concerns that American
    investors may be unknowingly funding zakat resulting from
    Shariah Compliant Finance, nor am I aware of charitable
    contributions from any U.S. financial institution presenting
    terrorist financing or other illicit financing concerns. If
    confirmed, however, I will be interested in learning more about
    this issue and will recommend action, if it appears warranted.

    Q.7. Shouldn't Shariah-Compliant financial institutions be
    required to disclose the destination of zakat payments?

    A.7. I am not aware of any unique problem that has been
    encountered with terrorist financing by the zakat practices of
    Shariah-Compliant financial institutions within the
    jurisdiction of the United States. If confirmed, however, I
    look forward to studying this issue and working with Congress
    to determine whether any special rules should be imposed.

    Q.8. Shouldn't Shariah-Compliant financial institutions be
    required to disclose the full and true nature of shariah, the
    basis of their business?

    A.8. Transparency is the touchstone of our antimoney laundering
    and counterterrorist financing programs, and thus I support the
    general proposition that U.S. financial institutions should be
    transparent about the products and services they offer to their
    customers. For Shariah-Compliant financial institutions, this
    transparency would include appropriate disclosure that the
    financial products and services it offers are specifically
    tailored to comply with shariah principles.

    Q.9. Shouldn't Shariah-Compliant financial institutions be
    required to disclose who the shariah scholars/advisors are and
    their associations and backgrounds?

    A.9. As noted in response to the prior question, I am a strong
    proponent of transparency in financial transactions. If
    confirmed, I will explore carefully the question whether the
    Treasury Department should require any additional disclosure of
    Shariah-Compliant financial institutions.
                  Additional Material Supplied for the Record
       STATEMENT OF EDWARD M. KENNEDY, A U.S. SENATOR FROM THE STATE OF
                                 MASSACHUSETTS
        Chairman Dodd and Members of the Committee: I appreciate this
    opportunity to offer my strong support for President Obama's nomination
    of Peter Kovar to be Assistant Secretary for Congressional and
    Intergovernmental Relations at the Department of Housing and Urban
    Development.
        I've known Peter for many years through his service in the office
    of Congressman Barney Frank, where he currently serves as Chief of
    Staff. Peter has a deep commitment to public service. He has a thorough
    understanding of the legislative process, and he is willing to go the
    extra mile in seeking common ground in discussions with other
    Congressional offices. These are some of the very qualities that
    attracted so many people to the message that Barack Obama put forth
    during his campaign, and they are, I believe, qualities that will
    enable Peter to perform very effectively as a direct link between
    Congress and HUD.
        We face a serious housing crisis, and we need to be prepared to
    work closely across party lines and with HUD in the effort to minimize
    the impact of foreclosures on our communities. I believe Peter is
    someone who will make valuable contributions to that vital effort, and
    to many other key HUD initiatives, by helping to keep Congress well
    informed about the Department's activities and ensuring that there will
    be a constructive exchange of ideas in the development of policies.
        I know that Congressman Frank is proud of the work that Peter has
    done on his staff over the years, and, as a fellow Bay State native, I
    share that view. Though Peter's departure to the Administration would
    deprive Congressman Frank and the rest of the Massachusetts delegation
    of his valuable work, I'm convinced that it will serve the greater
    interests of Congress and the Nation as a whole. I urge my colleagues
    to support Peter Kovar's nomination.
                                     ______

         STATEMENT OF JOHN F. KERRY, A U.S. SENATOR FROM THE STATE OF
                                 MASSACHUSETTS
        Mr. Chairman: It isn't often that a Senator gets to appear before a
    committee to recommend confirmation for not one but two former members
    of their staff.
        But I have that rare opportunity today, with Peter Kovar and Helen
    Kanovsky, both of whom have been nominated by President Obama to
    positions at the Department of Housing and Urban Development.
        When Helen and Peter worked for me I promised them one day they
    would be working for a Democratic president in his administration. Of
    course at the time I said that I thought the president would be me.
        Many of you know Peter. He has been involved in Massachusetts
    politics since 1982 and he has worked for members of Congress from
    Massachusetts for the last two decades. Since 1991, he has been Chief
    of Staff to Representative Barney Frank, a job that obviously took on
    new importance 2 years ago when Barney took over the chairmanship of
    the House Financial Services Committee.
        In 1985, my first year in the Senate, Peter was the correspondence
    manager in my Senate office. That means that he got the first look at
    all those wonderful cards and letters that came in from constituents,
    some of whom may have been a little upset about something the
    government was doing--or not doing.
        Come to think of it, that may have been perfect training for
    someone who has been helping Barney get Wall Street back in working
    order. Or maybe it was his work as a wine importer before deciding on a
    career in public service.
        During his years on the Hill, Peter has been involved in a number
    of important issues, including immigration, Medicare reimbursement,
    environmental protection, and government ethics. His years on the Hill
    make Peter a perfect choice to serve as HUD assistant secretary for
    congressional and intergovernmental affairs.
        Helen was my chief of staff from 1998 to 1999. And all of you know
    that a job like that prepares you for just about anything. In addition,
    she has skills as a lawyer, an adviser, and a leader, all of which she
    will need as the General Counsel to HUD.
        Most recently, Helen has been General Counsel to the AFL-CIO
    Housing Investment Trust (HIT), which, since its inception, has
    invested more than $5 billion to finance more than 85,000 units of
    housing nationwide, generating more than 58,000 union jobs.
        Housing will be at the forefront of our economic recovery, so it is
    fortunate that the President has chosen someone with Helen's experience
    to assist Secretary Donovan at HUD.

                                     ______

    From: Roussell, Melanie N
    Sent: Wednesday, April 22, 2009 2:01 PM
    To: Gilkey, Eureka N
    Subject: Fw: support for David Stevens

    FYI.

    Melanie Roussell
    Press Secretary
    U.S. Department of Housing and Urban Development
    Melanie.N.Roussell@hud.gov
    Blackberry: 571-423-8796
    Direct: 202-402-6605

    From: Martin Eakes
    To: Roussell, Melanie N
    Sent: Wed Apr 22 14:00:08 2009
    Subject: support for David Stevens

        Hello Ms. Roussell,
        As CEO of Self-Help and the Center for Responsible Lending, I want
    to register my support for the nomination of David Stevens for FHA
    Commissioner. Mr. Stevens has a very strong background in mortgage
    finance and has a well-deserved reputation for integrity. He will be a
    great leader for the FHA during this time of unparalled challenge and
    opportunity.
        If I can be of assistance, or provide further support, please let
    me know. Thank-you.

    Martin Eakes, CEO
    Self-Help
    919-956-4437