[Senate Hearing 113-91]
[From the U.S. Government Publishing Office]



                                                         S. Hrg. 113-91

 
         NOMINATIONS OF: WANDA FELTON AND KATHERINE M. O'REGAN

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



                                HEARING

                               before the

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

                    ONE HUNDRED THIRTEENTH CONGRESS

                             FIRST SESSION

                                   ON

                            NOMINATIONS OF:

 Wanda Felton, of New York, to be First Vice President, Export-Import 
                       Bank of the United States

                               __________

   Katherine M. O'Regan, of New York, to be an Assistant Secretary, 
              Department of Housing and Urban Development

                               __________

                           SEPTEMBER 10, 2013

                               __________

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


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            COMMITTEE ON BANKING, HOUSING, AND URBAN AFFAIRS

                  TIM JOHNSON, South Dakota, Chairman

JACK REED, Rhode Island              MIKE CRAPO, Idaho
CHARLES E. SCHUMER, New York         RICHARD C. SHELBY, Alabama
ROBERT MENENDEZ, New Jersey          BOB CORKER, Tennessee
SHERROD BROWN, Ohio                  DAVID VITTER, Louisiana
JON TESTER, Montana                  MIKE JOHANNS, Nebraska
MARK R. WARNER, Virginia             PATRICK J. TOOMEY, Pennsylvania
JEFF MERKLEY, Oregon                 MARK KIRK, Illinois
KAY HAGAN, North Carolina            JERRY MORAN, Kansas
JOE MANCHIN III, West Virginia       TOM COBURN, Oklahoma
ELIZABETH WARREN, Massachusetts      DEAN HELLER, Nevada
HEIDI HEITKAMP, North Dakota

                       Charles Yi, Staff Director

                Gregg Richard, Republican Staff Director

                  Laura Swanson, Deputy Staff Director

                           Pat Grant, Counsel

                 Beth Cooper, Professional Staff Member

              Brian Filipowich, Professional Staff Member

                    Colin McGinnis, Policy Director

                  Greg Dean, Republican Chief Counsel

          John O'Hara, Republican Senior Investigative Counsel

                    Travis Hill, Republican Counsel

                       Dawn Ratliff, Chief Clerk

                      Kelly Wismer, Hearing Clerk

                      Shelvin Simmons, IT Director

                          Jim Crowell, Editor

                                  (ii)


                            C O N T E N T S

                              ----------                              

                      TUESDAY, SEPTEMBER 10, 2013

                                                                   Page

Opening statement of Chairman Johnson............................     1

Opening statements, comments, or prepared statements of:
    Senator Crapo................................................     2

                                NOMINEES

Wanda Felton, of New York, to be First Vice President, Export-
  Import Bank of the United States...............................     3
    Prepared statement...........................................    16
    Biographical sketch of nominee...............................    18
Katherine M. O'Regan, of New York, to be an Assistant Secretary, 
  Department of Housing and Urban Development....................     5
    Prepared statement...........................................    26
    Biographical sketch of nominee...............................    27
    Responses to written questions of:
        Chairman Johnson.........................................    38
        Senator Crapo............................................    38


                            NOMINATIONS OF:

                       WANDA FELTON, OF NEW YORK,

                      TO BE FIRST VICE PRESIDENT,

                EXPORT-IMPORT BANK OF THE UNITED STATES;

                   KATHERINE M. O'REGAN, OF NEW YORK,

                     TO BE AN ASSISTANT SECRETARY,

              DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

                              ----------                              


                      TUESDAY, SEPTEMBER 10, 2013

                                       U.S. Senate,
          Committee on Banking, Housing, and Urban Affairs,
                                                    Washington, DC.
    The Committee met at 10:04 a.m., in room SD-538, Dirksen 
Senate Office Building, Hon. Tim Johnson, Chairman of the 
Committee, presiding.

           OPENING STATEMENT OF CHAIRMAN TIM JOHNSON

    Chairman Johnson. I call this hearing to order. Today we 
consider two nominations: the Honorable Wanda Felton, to be 
First Vice President of the Export-Import Bank of the U.S.; and 
Dr. Katherine O'Regan, to be Assistant Secretary for Policy 
Development and Research at the U.S. Department of Housing and 
Urban Development.
    Ms. Felton has been renominated to be the First Vice 
President of the Export-Import Bank. Ms. Felton was previously 
confirmed by the Senate by voice vote for her first term in 
2011. During her first term, Ms. Felton helped lead the Export-
Import Bank's efforts in promoting the President's National 
Export Initiative to double exports by 2015. She was critical 
to the Bank's efforts in emerging markets, particularly Sub-
Saharan Africa. Ms. Felton has also participated in multiple 
global access events to expand U.S. companies' export 
opportunities. Prior to joining the Export-Import Bank, Ms. 
Felton spent nearly 25 years working in the financial sector in 
a variety of positions, including operating MAP Capital 
Advisors, a financial advisory firm. Ms. Felton started her 
career as a loan officer at the Export-Import Bank.
    Dr. Katherine O'Regan has been nominated to be Assistant 
Secretary for Policy Development and Research at HUD. The 
Office of Policy Development and Research performs policy 
analysis, research, and evaluations to help Congress and HUD 
make informed policy decisions. Dr. O'Regan is currently a 
professor of public policy and planning and director of the 
Public and Nonprofit Management and Analysis Program at the 
Wagner Graduate School of Public Service, New York University. 
She holds a Ph.D. in economics from the University of 
California at Berkeley and spent 10 years teaching at the Yale 
School of Management. Dr. O'Regan's current research includes 
work on a variety of affordable housing, community development, 
and nonprofit management topics. She serves on the board of the 
Reinvestment Fund, the advisory board for NYU's McSilver 
Institute for Poverty Policy and Research, and the editorial 
board for the Journal of Policy Analysis and Management.
    Ms. Felton and Dr. O'Regan both have impressive backgrounds 
and are well qualified for the positions to which they are 
nominated. I hope we can move them through the Committee in a 
timely manner.
    I now turn to Ranking Member Crapo for his opening 
statement.

                STATEMENT OF SENATOR MIKE CRAPO

    Senator Crapo. Thank you, Mr. Chairman.
    Today the Committee is considering two important 
nominations for two different organizations, and you have been 
very thorough in your explanation of our nominees, and so I 
will be brief.
    Ms. Wanda Felton is being reappointed by the President, as 
you have said, Mr. Chairman, to her position as the First Vice 
President and Vice Chair of the Export-Import Bank of the 
United States. In that position, Vice Chair Felton stands ready 
to step into the shoes of President and Chairman when required, 
and she has held that position, as you indicated, since May of 
2011.
    Ms. Katherine O'Regan was recently nominated by the 
President to be Assistant Secretary for Policy Development and 
Research at the U.S. Department of Housing and Urban 
Development. Ms. O'Regan's position requires a critical 
understanding of housing markets and issues that homeowners 
face from both a quantitative and policy angle during a period 
that may prove to be among the most pressing and complex of our 
time.
    While each nomination is unrelated to the other, the two 
still share at least one critical requirement in their 
respective jobs, and that critical point here going forward is 
that each of the nominees must today be committed to greater 
transparency and accountability in the work they do for their 
agencies.
    Equally important is that each nominee understands the 
importance of having a well-run institution and commit 
themselves to accomplish their goals without burdening the 
American taxpayer.
    I look forward to hearing for the nominees and working with 
Chairman Johnson to move these nominations through the process 
and to the floor.
    Thank you, Mr. Chairman.
    Chairman Johnson. Thank you, Senator Crapo.
    Would any other Senator like to make an opening statement?
    [No response.]
    Chairman Johnson. The record will remain open for Senators 
who wish to submit an opening statement.
    We will now swear in the nominees. Will the nominees please 
rise and raise your right hand? 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?
    Ms. Felton. Yes.
    Ms. O'Regan. Yes.
    Chairman Johnson. Do you agree to appear and testify before 
any duly constituted committee of the senate?
    Ms. Felton. Yes.
    Ms. O'Regan. Yes.
    Chairman Johnson. Please be seated. Please be assured that 
your written statement will be part of the record. I invite you 
to introduce your family and friends in attendance before 
beginning your statement.
    Ms. Felton, please proceed.

   STATEMENT OF WANDA FELTON, OF NEW YORK, TO BE FIRST VICE 
       PRESIDENT, EXPORT-IMPORT BANK OF THE UNITED STATES

    Ms. Felton. Thank you, Chairman Johnson. My husband, 
Michael Owens, is sitting directly behind me, and my cousin, 
Reginald Felton, is here as well. Thank you.
    Thank you Mr. Chairman. Chairman Johnson, Ranking Member 
Crapo, and the Members of the Committee, thank you for inviting 
me to testify today. I am extremely gratified that President 
Obama has nominated me to serve a second term as First Vice 
President and Vice Chair of the Export-Import Bank of the 
United States. If confirmed, I look forward to working with you 
to continue growing exports and supporting U.S. jobs.
    I want to, as I had previously done, acknowledge again my 
husband, Michael Owens, and my other family member who is here.
    Eximbank is the official export credit agency of the United 
States. The Bank's mission is straightforward: to promote U.S. 
job growth and job retention through exports. The Bank provides 
financing to help U.S. companies expand into overseas markets 
when financing is not available in the private sector. Eximbank 
also steps in when there is a need to level the playing field 
because U.S. exporters are facing foreign competitors with 
financing from their Governments. The goal is to take financing 
off the table as a competitive factor so that American 
companies can compete for exports fair and square. Importantly, 
Eximbank operates at no cost to U.S. taxpayers. The Bank 
generated $1.1 billion for U.S. taxpayers in fiscal year 2012 
alone.
    Eximbank is central to the National Export Initiative to 
double exports by 2015. President Obama's goal in announcing 
this initiative was to stimulate job growth and position our 
economy for sustained competitiveness and prosperity. I am 
passionate about this mission, and there is good reason for my 
enthusiasm.
    ``Made in the USA'' remains the world's strongest brand. 
However, the global economy has never been more competitive. I 
believe we have a responsibility to do what we can to help 
American companies win the battle for international market 
share. In fiscal year 2012, Eximbank supported an estimated 
255,000 jobs at 3,600 companies.
    During my first term, I traveled to 20 cities and towns 
across the United States to engage small businesses and other 
business leaders in an effort to promote the President's 
National Export Initiative. If confirmed, I will continue this 
outreach because small businesses are the bedrock of our 
economy and their prosperity is essential to job creation.
    In fiscal year 2012, Eximbank authorized $6.1 billion of 
direct support for small businesses, and this represented 88 
percent of our transaction volume that year. When indirect 
exports are taken into account, Eximbank provided a total of 
$7.5 billion to support small business.
    It is a fact that large exporters win sales that feed a 
huge but hidden chain of small and middle-market companies. 
Eximbank recognizes the potential of this economic leverage and 
has sought to amplify it.
    In addition to small business outreach, I led the 
President's--I am sorry. I led the Bank's effort to increase 
commercial engagement between the United States and Sub-Saharan 
Africa. Eximbank has a congressional mandate to promote trade 
with Africa, and the President has made this a centerpiece of 
his trade policy.
    I have worked to advance our congressional mandate and 
promote the President's agenda. I worked closely with the 
Bank's Sub-Saharan Africa Advisory Committee to develop a 
strategic plan to help the Bank achieve more robust results in 
Africa--without taking undue risk.
    I look at every transaction through the lens of financial 
merit. Is the transaction creditworthy? Is there a reasonable 
assurance of repayment? That is always my starting point.
    For 15 years I worked in private equity. Many of my clients 
invested in small and middle-market growth companies, so I have 
had the opportunity prior to joining Eximbank to steer capital 
to small businesses, including companies owned by women and 
minority entrepreneurs. I also did business in Latin America, 
India, Africa, and parts of Asia. These are some of Eximbank's 
most important markets.
    Let me close by noting that I began my career at Eximbank. 
I learned credit analysis at the Bank, and I have worked in 
finance ever since. I have approximately 25 years of experience 
in credit and financial analysis which brings a perspective 
that is valued by board members and career staff.
    Finally, it is impossible for me to convey how much it has 
meant to me to be able to return to Eximbank. The Bank has 
changed dramatically under Chairman Hochberg's leadership. In 
many ways, it is unrecognizable from the place I worked in the 
early 1980s. The commercial vitality and energy are palpable. 
Eximbank is reaching many more small businesses and supporting 
more U.S. jobs than ever before.
    However, one thing has not changed: The Bank has world-
class employees. They take their fiduciary duty to protect the 
public trust very seriously, and these public servants care 
deeply about Eximbank's mission. They could work anywhere 
making a lot more money, and yet they choose Government 
service. They work long hours to provide financing that keeps 
American workers employed. It is personal to them.
    If confirmed, it would be a privilege for me to continue 
working with such a fine group of people.
    Thank you.
    Chairman Johnson. Thank you, Ms. Felton.
    Dr. O'Regan, please proceed.

   STATEMENT OF KATHERINE M. O'REGAN, OF NEW YORK, TO BE AN 
     ASSISTANT SECRETARY, DEPARTMENT OF HOUSING AND URBAN 
                          DEVELOPMENT

    Ms. O'Regan. Chairman Johnson, Senator Crapo, and Members 
of the Committee, I am honored to appear before you today as 
you consider my nomination as the Assistant Secretary for the 
U.S. Department of Housing and Urban Development's Office of 
Policy Development and Research. I would like to start with 
some acknowledgments of family and friends. In addition to 
those watching from a distance, my brother Bill and his son, 
Billy, are seated behind me today. And watching with several 
sisters of mine, I want to specifically acknowledge my mother, 
Mary O'Regan, whose own career so greatly shaped my path to 
this hearing. Through her work in public health and my father's 
work in education, I was taught early the tremendous value of 
public service.
    My mother is a nurse who spent most of her professional 
career running a health clinic located in a HUD-funded public 
housing project. I spent formative years witnessing the 
importance of place, how neighborhoods and communities matter 
in the lives of families, and how very important policies and 
community institutions can be when well run.
    My career has focused on such communities, policies, and 
institutions, so I would like to briefly highlight three 
aspects of my background most relevant for this position that 
also shed light on how I see this role.
    First, my training and research are well aligned with HUD 
broadly and this office specifically. For more than 20 years, I 
have taught and conducted research on a range of issues related 
to housing policy, urban areas, and community development. This 
includes work focused on how and why neighborhoods and 
communities change, what policies might drive economic 
improvements, and research evaluating the various effects of 
housing policies. As an economist who does quantitative work, I 
am a frequent user of the data this office collects. As a 
researcher whose own work speaks directly to policy, I 
appreciate the critical contribution of this office in driving 
data-driven policy decisions. Part of the office's charge is to 
link to the broader research community, of which I am a 
longstanding member.
    Second, the Office of Policy Development and Research has a 
much broader and more important set of constituents, namely, 
the wide array of Federal, State, and local actors in the 
housing and community development fields. I have been actively 
engaged with members of these groups far beyond my research, 
from advising and collaborating with local agencies to formal 
and informal work with community development organizations. My 
experience with these groups and agencies provides me with a 
much better understanding of their needs and how HUD may better 
serve them.
    Finally, I have extensive administrative and managerial 
experience. Over my career, I have undertaken a range of 
leadership roles, including more than a decade leading the 
largest Master's program at NYU's Wagner School for Public 
Service. My most significant managerial role was as associate 
dean of faculty during a time of momentous change at the 
school. This position required working collaboratively within 
the school, across the university, and with external 
stakeholders. I chose to do this work because having well-run 
institutions matters, and having managed has improved how I 
think about the design of effective policies.
    Achieving HUD's mission requires the data and knowledge to 
make sound, evidence-based choices about using our limited 
resources well, and this is the office's main role: to create 
such knowledge, and to participate in policy decisions that 
make good use of evidence. Secretary Donovan has emphasized 
this approach throughout his tenure and its importance to the 
continued transformation of HUD. If confirmed, I look forward 
to working tirelessly on this goal, with the Secretary, the 
administration, and Members of this Committee, and I would be 
honored to have the opportunity to serve.
    Thank you, and I look forward to your questions.
    Chairman Johnson. Thank you, Dr. O'Regan.
    We will now begin asking questions of our witnesses. Will 
the clerk please put 5 minutes on the clock for each Member?
    Ms. Felton, during the most recent economic crisis, the 
Bank was able to help American exporters who were finding it 
difficult to acquire private financing. As the economy 
continues to improve, how do you see the Bank's role changing?
    Ms. Felton. Thank you, Chairman Johnson. The Bank has had 
record growth in the last 4 years, and that is a reflection of 
the economic conditions that existed. It is true that the Bank 
tends to be countercyclical and become more active during 
difficult economies. I would expect that as the economy 
improves that the Bank's activity would level off. I think we 
have already begun to see that with respect to the number of 
applications that we are receiving to finance aircraft, and 
that would continue in all likelihood as the economy improves. 
Thank you.
    Chairman Johnson. Ms. Felton, can you describe how the Bank 
has worked to meet the goal of the President's National Export 
Initiative, which seeks to double U.S. exports by 2015?
    Ms. Felton. Yes, sir. Eximbank is really, I think, at the 
center of the President's National Export Initiative. One of 
the things that the Bank has done is tried to focus very 
actively on bringing more small businesses into exporting, help 
them understand the opportunities that are available to them 
outside the United States and how to use Eximbank's financing 
to support their growth.
    There are statistics that abound: 95 percent of the world's 
consumers are outside the United States. Some 200 million 
people enter the middle class globally each year. There is an 
expectation that there will be $2 trillion worth of spending 
every year for the next 20 years on infrastructure. These 
create enormous opportunities for American businesses, both 
large and small, and one of the things the Bank has done is led 
a very proactive outreach effort that included 60 what we call 
Global Access Forums in the last year in order to make sure 
American companies are aware of these opportunities and going 
out and seeking them.
    Chairman Johnson. Dr. O'Regan, as you mentioned, you have 
had considerable experience as a researcher, both producing and 
consuming the kind of information that the Office of Policy 
Development and Research, PD&R, makes available. How has this 
experience informed your goals for your time as the head of the 
office, if confirmed?
    Ms. O'Regan. Thank you, Chairman. I have been very involved 
in research in this area and know PD&R, as it is called, well 
and its work. I think the current circumstances in housing 
markets have only elevated the importance of having a strong, 
independent analytical arm within HUD that can and that does 
collect current information on housing markets and has the 
capacity to conduct timely evaluations on what is going on in 
housing markets and to be active as housing reforms come 
through and other policies to see their impact in the market. 
So I see that as one of the biggest areas that PD&R should be 
focusing on going forward. If confirmed, that would be my 
highest priority.
    Chairman Johnson. Dr. O'Regan, in addition to your public 
policy research credentials, you also bring both research and 
experience in management to your nomination. How would this 
experience shape your management agenda at PD&R?
    Ms. O'Regan. Thank you, Chairman. Yes, that is the other 
side of the research agenda that I have. It was driven in part 
by observations that I made in the field, but also having spent 
10 years at the Yale School of Management, and it gave me 
experience that my training in economics had not. And it has 
taught me the role of strong governance, transparency and 
accountability, and paying as much attention to the 
implementation side of developing policies that could work 
along with the policies themselves. If you focus on only one, 
you can fail.
    Chairman Johnson. Ms. Felton, during your time on the 
Board, you have focused on increasing American exports to 
Africa. Can you explain why increasing exports to Africa is 
good for American businesses and workers?
    Ms. Felton. Yes, Mr. Chairman. I think it is vitally 
important, actually. Consistent with my earlier comment about 
the growth that is taking place in emerging markets in 
particular more broadly, in Africa there is a projection and 
expectation of enormous growth. Seven of the ten fastest-
growing economies in the next 5 years are expected to be in 
Africa. We have already seen over the last decade real growth, 
not just economic growth but demographic changes and political 
stability that create a business climate in many countries that 
should be very attractive for investment and trade.
    My observation is that if American companies participate in 
this, again, not just in Africa but globally, that offers the 
opportunity to stimulate real economic growth at home with the 
opportunity to create jobs and lasting prosperity.
    Finally, with respect to Africa, American companies have 
not been as active as they could be because, I think, of real 
risk aversion and perceptions about risk. However, there are 
ways to do business in a way that contains risk and is 
thoughtful about the risk that doing business in any foreign 
country can present. And, importantly, if we do not put our 
stakes down now, we risk being marginalized for a very, very 
long time, if not forever. There is a lot of competition from 
other countries, particularly coming from Asia, and China 
especially; and many of the large infrastructure projects that 
need to get built get built once. And if you miss that 
opportunity, you are locked out, probably for a generation or 
more. And you miss the after sales, the maintenance; you miss 
the next opportunity to build a project. And it also relates to 
the consumer sector. Consumer brands get established early, and 
consumer loyalties get established early. So there is a huge 
opportunity across an array of sectors for American companies 
to participate and grow jobs.
    Chairman Johnson. Senator Crapo.
    Senator Crapo. Thank you very much, Mr. Chairman.
    Ms. Felton, at the outset I want to thank the Eximbank for 
their outreach to small businesses around the country. As I am 
sure you are aware, Idaho was the beneficiary just recently of 
one of the efforts that the Eximbank is making to help bring 
small businesses into a greater understanding of the potential 
that is available for us to increase our exporting. And that 
was something that was very well attended, and I think it is 
going to be very beneficial to the small businesses in Idaho. 
And I appreciate the fact that I see that going on around the 
country. I think that is important.
    Could you repeat again--I think you said something about 
this in your opening statement. But the level of success that 
we are now achieving among small businesses with the Bank's 
efforts, could you discuss that again briefly?
    Ms. Felton. Yes, and let me say the Bank was very excited 
to have the opportunity to do a Global Access Forum in your 
State, Senator.
    The Bank, when Chairman Hochberg joined, did about $3.2 
billion--I think in his first year, in 2008 did $3.2 billion of 
support for small businesses. And in the last year, we reported 
$6.1 billion of direct support for small business, and that 
does not include an additional amount that was done of indirect 
support. By that I mean support that went to larger exporters 
who, because they want a sale, were able to participate in the 
growth outside the United States and received Export-Import 
Bank financing indirectly. It is very important.
    That is just our small business number. We have in the last 
year authorized $35.8 billion of total authorizations for U.S. 
exports.
    Senator Crapo. All right. Thank you. And I want to 
highlight another point that you made in your statement because 
one of the issues that we face with regard to virtually every 
agency today is what burden they bring to our budget, 
particularly to the impact on the American taxpayer. And as you 
have indicated, the Eximbank operates as a self-sustaining 
entity and has for some years now. Could you give us those 
figures again?
    Ms. Felton. Yes. In the last year, Eximbank generated $1.1 
billion for the taxpayer.
    Senator Crapo. I wish every single one of our Federal 
programs could operate in the same way. We would not have the 
same problems. But I think that it is notable, and it is 
important to make that note as we go into the budget battles 
that we will, unfortunately, be getting deeply into--and I 
guess fortunately. We need to get into them, and we need to get 
them resolved in some good ways.
    Another question I have is: You mentioned in your testimony 
that one of the first if not the first questions you asked with 
regard to any proposal is whether there is a reasonable 
assurance of repayment. In that context, one of the questions I 
would like to have you respond to is what I have noticed over 
the years in observing the Eximbank's operations, which I think 
have been handled very well, is that often, as you just 
indicated, there are suppliers as well as major manufacturers, 
and many others in the chain of production of a product or 
delivery of a service, and they are not always all U.S. 
companies or all non-U.S. companies. And so a loan could be 
proposed for an entity with the basis of the loan being that it 
is a U.S. company or that it is going to have suppliers who are 
U.S. companies. But other competitors, other competitor 
suppliers or other competitor producers, might not be U.S. 
companies. And I think it might get a little bit complicated in 
trying to make sure that we are not using the Eximbank to 
subsidize companies that are not American made, if you will.
    Do you understand the question I am asking? It has got to 
be an issue that comes up as we deal with the different supply 
lines and allocations of production.
    Ms. Felton. Yes, sir, I think I understand the question. I 
think there may be two questions embedded in there. The 
Eximbank is careful--I think you are alluding to content.
    Senator Crapo. Yes.
    Ms. Felton. The Export-Import Bank has a requirement, a 
policy in place that requires that we finance the lesser of 85 
percent of the U.S. content or 100 percent of the contract 
value. We managed that policy--there are some critics that say 
that we should lower our content requirements. However, if we 
did that, we might find ourselves in a position of supporting 
foreign jobs and production.
    We do think it is important to make sure that American 
companies are able to compete. And as I noted in my comments, 
the global economy is very, very competitive, and many foreign 
Governments are providing export finance for their companies, 
and we have to be mindful of that. But we also see that as an 
opportunity to cofinance with other countries.
    And I can provide one example, I think, that is very 
illustrative. There is a company that makes crop dusters in 
Texas called Air Tractor, and Air Tractor, most of the 
production, 70 percent of it, is done in the United States. 
However, they build the engines in Canada, and so 30 percent of 
the content is Canadian. We cofinanced exports for Air Tractor 
with the Canadian export credit agency, EDC, and that way Air 
Tractor was able to receive full financing for its exports, and 
at the same time Eximbank did not use American taxpayers' 
dollars to support the Canadian content.
    Senator Crapo. Thank you. I appreciate that, and I do have 
some questions for Dr. O'Regan, but I will wait for my next 
chance, Mr. Chairman.
    Chairman Johnson. Senator Warren.
    Senator Warren. Thank you, Mr. Chairman. Thank you. Thank 
you both for being here.
    Ms. Felton, I very much appreciate the focus in your 
original testimony on small businesses and the importance of 
the Eximbank and how it is that it can support small businesses 
and give them access to markets they might not otherwise have. 
And I, like the Ranking Member, am very pleased to see some of 
the good news that you are able to bring us that the number of 
dollars that have gone into small business lending has 
increased from 2008 to 2012.
    But the bad news seems to show that over the last 5 years, 
the Bank has dedicated a smaller proportion of its lending to 
small businesses, and so while small business lending made up 
22 percent of Eximbank's lending back in 2008, by 2012, 
according to your published reports, it is down to 17 percent.
    So I am a little concerned here about the trend. Can you 
give us some explanation about what is going on?
    Ms. Felton. Yes, Senator. Thank you for the question. It is 
a very good one. We are mindful that we have a congressional 
mandate to finance or allocate 20 percent of our financing to 
small businesses. And what I should have noted is that 
although, as you correctly pointed out, the dollar amount that 
has gone to small business relative to our total outstanding 
financing has declined, the number of transactions that are 
represented in our activity is very, very significant. Eighty-
eight percent of our transaction volume in 2012 represented 
small businesses. And that is kind of the classic 80-20 rule, 
that it is labor intensive, it takes a lot to reach small 
businesses, and that it is part of why we are conducting so 
many Global Access Forums around the country in order to reach 
out and find them and make sure that they know about the 
opportunity to work with Eximbank in order to finance their 
exports.
    But beyond the outreach and the promotion, we have created, 
I think, a number of strategies and adopted some innovations in 
order to leverage our resources better so that we can get more 
done, and I think taken some other very important initiatives.
    So when you look at the relative decline as a percentage of 
our financing of the dollars that have gone to support small 
business, it is really a function of the denominator. What we 
are finding is that, you know, there are a number of very large 
transactions that are coming to the Bank, some of them having 
to do with large infrastructure projects. I will give you an 
example. We financed a large petrochemical facility in Saudi 
Arabia. It was $5 billion of financing, and I think it created 
something like 11,000 jobs or supported 11,000 jobs in the 
United States. That is very powerful.
    But in order to get the opportunity to support so many jobs 
with one transaction that is $5 billion, we would have to go 
out and find $1 billion of small business opportunities to 
support, and that can be difficult. So that is one of the 
things that you are seeing when you see the relative decline in 
terms of small business support compared to what we have done 
overall.
    I would say that--and I will finish this up--in addition to 
creating new programs to create more efficiency with respect to 
how we process small business activity, we have been very 
successful in negotiating opportunities for U.S. procurement, 
particularly from small businesses, with respect to some of the 
large projects that we finance. So, for example, Pemex is the 
large--the national oil company for Mexico. We financed them 
for a long time so that they could purchase from the United 
States. And a couple of years ago, our project finance team 
negotiated a set-aside for small business of $200 million, 
asked Pemex to identify 500 small companies that they do 
business with. We scrubbed that list to make sure that they, in 
fact, were small businesses, that they existed, and that they 
complied with the SBA's definition of small business.
    So we take the mandate very seriously. We are working 
closely with the SBA as part of the Commerce Department, SBA 
collaboration on global business solutions, and doing 
everything we can in order to promote more financing for small 
businesses.
    Senator Warren. Well, then let me just wrap this up by 
saying I very much appreciate the attention you are giving to 
this. I very much appreciate the outreach and the multiple ways 
in which you may assist small businesses, sometimes through 
large business lending. But I hope that the trend line we are 
seeing--and that is dropping from, just in a very short period 
of time, 22 percent of the dollars that go out the door are 
going to small businesses down to 17 percent of the dollars 
going out the door are going to small businesses. I hope that 
is a trend line we are going to be able to stop and to reverse, 
that it is still the mandate for Eximbank to be able to make 
sure that we are getting these dollars directly to our small 
businesses.
    Ms. Felton. Yes, Senator. I can assure you that the 
Chairman is very committed to that, and if confirmed, I would 
be very committed as well.
    Senator Warren. Good. Thank you very much.
    I will hold off on Ms. O'Regan. Thank you. Thank you, Mr. 
Chairman.
    Chairman Johnson. Ms. Felton, authorizations for women-
owned and minority-owned small businesses reached a record $838 
million last year, up almost 17 percent from 2011. What can the 
Bank do moving forward to support even more minority-owned and 
women-owned businesses?
    Ms. Felton. Thank you, Mr. Chairman, for that question. We 
have a number of outreach efforts underway in order to reach 
more minority-owned businesses. For example, we signed an MOU 
with the minority development--supplier development agency at 
the Commerce Department so that we can collaborate in working 
with them and identifying opportunities to work with minority-
owned firms. Some of the data that they have developed shows 
that very often small business exporters export to their 
country of home origin, and they have familiarity and 
relationships and understand the markets.
    And so one of our directors, Director Pat Loui, who is 
sitting here behind me, has led the outreach to the Asian 
American Pacific Islanders demographic in order to increase our 
penetration and make them more aware of opportunities to do 
business with Eximbank. I have worked with African American 
groups; specifically, I see an opportunity to work with the 
African diaspora community, many of whom came here to go to 
school, went to college and obtained graduate degrees, and are 
a real asset to the United States and Africa. They are not as 
risk averse as other companies in terms of going out and 
seeking the opportunities. And some of them have engineering 
companies that got started with Government contracts and have 
demonstrated over, you know, one or two decades the ability to 
do whatever it is, in terms of construction and building and 
engineering work, and make--I think that there may be an 
opportunity to help companies like that that have demonstrable 
experience in construction develop opportunities to build small 
power plants, do water projects, whatever, in Africa. And we 
have done some of that already.
    Chairman Johnson. Ms. Felton, what is your experience 
dealing with the Native American community?
    Ms. Felton. Sir, I personally do not have a lot of 
experience dealing with the Native American community. However, 
I did have the opportunity to work a little bit with the 
Commerce Department. A former official there, Reta Jo Lewis, 
was very involved in the Sister Cities and also the Native 
American outreach effort through the Commerce Department. So it 
is something that we can, I think, put higher up on our list of 
priorities.
    Chairman Johnson. Yes. Dr. O'Regan, what would your 
priorities be as Assistant Secretary for PD&R at HUD?
    Ms. O'Regan. Thank you, Mr. Chairman. My first priority, if 
I were to be confirmed, is to do an assessment of the current 
capacities at PD&R. In 2008, as you probably know, the National 
Academy of Sciences did an assessment of PD&R, and one of their 
key findings was that over the past several decades, its 
capacity had deteriorated. Since then, in the past 5 years, 
major strides have been made in increasing its capacity--the 
analytical capacity and the data needed for the type of 
independent research that we all need for our housing policies. 
And so I think the time has come to do an assessment. That 
would be the first step, if confirmed, to see what is needed 
now to secure the gains that have been made and any additional 
steps to be sure that we have the data that we need for 
monitoring well-functioning housing markets.
    Chairman Johnson. Senator Crapo.
    Senator Crapo. Thank you, Mr. Chairman.
    Dr. O'Regan, I want to get into some issues that are 
specifically going on at HUD right now. I realize that you are 
appointed to go there, but I am hopeful that you can comment on 
some of these.
    Currently at HUD there is a proposed rule on the 
Affirmatively Furthering Fair Housing. This rule will provide 
data to grantees participating in certain housing programs and 
is aimed at fulfilling HUD's responsibility to assure that we 
combat discrimination in these programs. Are you familiar with 
this proposed rule?
    Ms. O'Regan. Yes, I am.
    Senator Crapo. Good. Could you tell me specifically what 
types of data will HUD be providing under the rule?
    Ms. O'Regan. Thank you, Senator, for that question. The 
proposed rule has been made, and we are still in the public 
comment period, so I have not read through most of the public 
comments, and then HUD would probably be responding to those 
comments. But I do not know the specifics. On that front, 
though, PD&R, for whatever data will be created and put 
forward, PD&R would have a very big role. That is where it 
should sit. And the goal, as I would see it, if I was 
confirmed, is to make sure that we have the burden of the 
creation of the data and the transmission of the data on HUD, 
not the participants and the local communities, and this 
actually might help level the playing field on communities of 
different sizes that do not have the scale to be able to get 
the data needed themselves; and then to make sure that the data 
are going to be able to answer the kind of questions that are 
embedded in the proposed rule.
    Senator Crapo. Well, thank you. In fact, you answered what 
was going to be one of my follow-up questions about where this 
burden would fall.
    Do you have any privacy concerns? And how will this data 
collection interplay with HUD's existing data collection 
efforts?
    Ms. O'Regan. Thank you, Senator. That would probably be a 
little bit speculative from the outside, having read the 
proposed rule. There are many publicly available data that are 
aggregated at levels that always protect privacy and that are 
still at a low enough level of geography that we can do the 
kinds of work and assessing what is looking at--how 
neighborhoods look relative to other parts of the metropolitan 
area. So I would see no need for going below that level for 
this type of analysis.
    Senator Crapo. All right. That would be important, in my 
opinion, to protect the privacy. Can you discuss this rule, the 
assessment of the rule the grantees will be required to 
complete under the proposed rule? And how does that compare to 
the existing analysis of impediments to fair housing choice?
    Ms. O'Regan. Senator, the final rule has not been written, 
but comparing just the process component of this rule, it moves 
the analysis earlier in the process. And so to the extent that 
planners are going to take important information into account 
in making choices, it moves the data and the information before 
the choices are made. And so to me that seems a great 
contribution. Adding data into the analysis after a decision is 
made is not very useful.
    Senator Crapo. We can agree on that. Well, I thank you for 
your efforts here, and I will look forward to having a further 
discussion with you after we get further into this process and 
you are heavily involved in its implementation.
    Thank you.
    Chairman Johnson. Senator Warren.
    Senator Warren. Thank you.
    Dr. O'Regan, as you know, the financial crash of 2008 was 
quick, sudden, and it caught our Nation unawares and seemed to 
catch most of our regulators unawares as well. But the crisis 
was years in the making, and there really were a lot of 
signposts that we were headed for trouble.
    I think specifically about consumer financial products. A 
generation ago it was clear, you could see the price of a 
credit card, of a mortgage, checking accounts. Both the 
borrowers and the lenders knew the terms of what they were 
getting into. By the time of the crash, lenders had moved to a 
very different business model where they advertised one up-
front price, but then back in the fine print there were lots of 
charges and changes in the interest rates and so on that 
ultimately changed how much the consumer was paying and 
obscured how much the consumer was paying. Buyers were less and 
less able to make comparisons among products and less and less 
able to tell what kind of obligation they were taking on.
    Now, the 2008 crash started one lousy mortgage at a time, 
and yet our regulators seemed remarkably caught off guard 
during this. As you know, the Office of Policy Development and 
Research at HUD is responsible for monitoring the housing 
market conditions and analyzing and gathering data. So my 
question is: What do you think needs to change at HUD in the 
way data are collected and analyzed to make sure we are never 
caught by surprise again?
    Ms. O'Regan. Senator, thank you for that question. I am 
going to build off my earlier response on thinking about that 
report from the National Academy of Sciences, which is that the 
internal capacity inside PD&R on data and analytics had 
declined dramatically, and one part of that was in the 
economics and housing market piece. And that has been one of 
the areas that has been built up most since 2008, and I think 
that is critical. You need ongoing research and data, and you 
need the staff capacity to be paying attention. And so the 
number of staff that have been lost during that time with 
expertise was quite large.
    A second piece of this, though, I think, as you know, you 
are going to be watching the indicators. You have the data, and 
you have got the right staff for doing it. You need to be 
forward-looking, and the ability of PD&R to be looking forward 
through demonstrations and research had also been limited.
    One of the areas in which I know HUD is doing research now 
has to do on financial literacy and different types of 
counseling programs to both see which ones work and which ones 
are more cost effective. That is something we should know as we 
are looking to design the solutions to avoiding the next 
housing crisis.
    So I think you need capacity both for what is going on in 
the moment and looking forward.
    Senator Warren. And you feel like you have the commitment 
that you are going to be able to have the resources you need to 
collect the data you need and have the people you need to 
analyze them?
    Ms. O'Regan. If I am confirmed, that is my highest 
priority, and it is why I am taking this job.
    Senator Warren. Good. I am delighted to hear it.
    Now, I have another question for you along another part of 
this line, and that is, as you know, the housing market has not 
entirely recovered from the 2008 crisis. According to a recent 
study by CoreLogic, one in five families with a mortgage is 
still below water. So the question I have for you is: What is 
it that your division can do to help inform HUD and to make 
certain that HUD is responding to the housing crisis in the 
fullest and most effective way?
    Ms. O'Regan. Thank you, Senator. I think this is on the 
research side. One of the most difficult things is to look out 
at a complicated problem like what is going on in housing 
markets and see possible solutions, and the benefit of having 
ongoing research--and, for example, the decisions that 
households make when they are underwater, there has been a 
considerable amount of research during this crisis that has 
surprised some analysts on who walks away or who does not walk 
away and what does it take to be able to--what type of 
modifications does it take in order to have sustainable 
homeownership, and those insights came from research. And so I 
think this is the purview of what PD&R should be strong at, and 
these types of lessons from the last several years should shape 
the agenda of what research we are doing going forward.
    Senator Warren. So I am hearing you say in part that what 
you want to do is you want to expand the reach of the research 
and take it in some new directions. Is that correct?
    Ms. O'Regan. One of the things that PD&R did in the last 
year was expand the way it devised its forward-looking research 
agenda. One of the criticisms in the National Academy of 
Sciences report was that it was insular, looked inside PD&R and 
HUD for making these decisions. They took that to heart. They 
opened up the process last year, had hearings, conferences, and 
input from others to shape the forward-looking agenda in a way 
that it should meet the needs of a much broader set of people 
who are looking at housing markets.
    So I think that process is exactly a much better one than 
was used in the past, and I would be recommending using 
something like that going forward for setting the research 
agenda.
    Senator Warren. Good. Well, I just want to say I am very 
encouraged by the direction that HUD has already started, but 
by the way you talk about the importance of research and as you 
rightly say, Ranking Member, the importance of doing the 
research that helps us inform decisions before we make them, 
that we have a real opportunity here to make better decisions 
going forward. So thank you very much. Thank you both. Thank 
you for your willingness to serve.
    Thank you.
    Chairman Johnson. Thank you, Ms. Felton and Dr. O'Regan, 
for your testimony and for your willingness to serve our 
Nation.
    I ask all Members to submit questions for the record by COB 
this Friday, September 13. I would also ask the nominees to 
please submit your answers to the written questions as soon as 
possible so that we can move your nominations in a timely 
manner.
    This hearing is adjourned.
    [Whereupon, at 10:55 a.m., the hearing was adjourned.]
    [Prepared statements, biographical sketches of nominees, 
and responses to written questions supplied for the record 
follow:]
                   PREPARED STATEMENT OF WANDA FELTON
  To Be First Vice President, Export-Import Bank of the United States
                           September 10, 2013
    Thank you Mr. Chairman. Chairman Johnson, Ranking Member Crapo, and 
the Members of this Committee, thank you for inviting me to testify 
today. I am extremely gratified that President Obama has nominated me 
to serve a second term as First Vice President and Vice Chair of the 
Export-Import Bank of the United States. If confirmed, I look forward 
to working with you to continue growing exports and supporting U.S. 
jobs.
    I also want to acknowledge the presence and support of my mother 
Maro Lester, my husband Michael Owens, and other family members who are 
here today.
    Ex-Im Bank is the official export credit agency of the United 
States. The Bank's mission is straightforward--to promote U.S. job 
growth and job retention through exports. The Bank provides financing 
to help U.S. companies expand into overseas markets when financing is 
not available in the private sector. Ex-Im Bank also steps in when 
there is a need to level the playing field because U.S. exporters are 
facing foreign competitors with financing from their Governments. The 
goal is to take financing off the table as a competitive factor so that 
American companies can compete for export sales fair and square. 
Importantly, Ex-Im Bank operates at no cost to taxpayers. The Bank 
generated $1.1 billion for the U.S. taxpayers in FY2012 alone.
    Ex-Im Bank is central to the National Export Initiative to double 
exports by 2015. President Obama's goal in announcing this initiative 
was to stimulate job growth and position our economy for sustained 
competitiveness and prosperity. I am passionate about this mission, and 
there is good reason for my enthusiasm.
    ``Made in the USA'' remains the world's strongest brand. However, 
the global economy has never been more competitive. I believe that we 
have a responsibility to do what we can to help American companies win 
the battle for international market share. In fiscal 2012, Ex-Im Bank 
supported an estimated 255,000 American jobs at 3,600 companies.
    During my first term, I traveled to 20 cities and towns across the 
United States to engage small businesses and other business leaders in 
an effort to promote the President's National Export Initiative. If 
confirmed, I will continue this outreach because small businesses are 
the bedrock of our economy and their prosperity is essential to job 
creation.
    In fiscal 2012, Ex-Im Bank authorized $6.1 billion of direct 
support for small business exporters. This represented 88 percent of 
2012 transaction volume. When indirect exports are taken into account, 
Ex-Im Bank provided a total of $7.5 billion of support for small 
businesses.
    It is a fact that large exporters win sales that feed a huge but 
hidden chain of small- and middle-market suppliers. Ex-Im Bank 
recognizes the potential of this economic leverage and has sought to 
amplify it through new programs.
    In addition to small business outreach, I led Ex-Im Bank's effort 
to increase commercial engagement between the United States and sub-
Saharan Africa. Ex-Im Bank has a congressional mandate to promote trade 
with Africa, and the President has made this a centerpiece of his trade 
policy.
    I have worked to advance our congressional mandate and promote the 
President's agenda. I worked closely with Ex-Im Bank's Sub-Saharan 
Africa Advisory Committee to develop a strategic plan to help the Bank 
achieve more robust results in Africa--without taking undue risk.
    I look at every transaction through the lens of financial merit. Is 
the transaction creditworthy? Is there a reasonable assurance of 
repayment? That is always my starting point.
    For 15 years I worked in private equity. Many of my clients 
invested in small- and middle-market growth companies so I helped steer 
capital to small businesses, including companies owned by women and 
minority entrepreneurs. During those years, I also did business in 
Latin America, India, Africa, and parts of Asia. These are some of Ex-
Im Bank's most important markets.
    Let me close by noting that I began my career at Ex-Im Bank. I 
learned credit analysis at the Bank and have worked in finance ever 
since. I have approximately 25 years of experience in credit and 
financial analysis which brings a perspective that is valued by board 
members and career staff.
    Finally, it is impossible for me to convey how much it has meant to 
me to be able to return to Ex-Im Bank. The Bank has changed 
dramatically under Chairman Hochberg's leadership. In many ways, it is 
unrecognizable from the place I worked in the early 1980s--the 
commercial vitality and energy are palpable. Ex-Im Bank is reaching 
many more small businesses and supporting far more U.S. jobs than ever 
before.
    However, one thing has not changed--Ex-Im Bank has world-class 
employees. They take their fiduciary duty to protect the public trust 
very seriously and these public servants care deeply about Ex-Im Bank's 
mission. They could work anywhere making a lot more money, yet they 
choose Government service. They work long hours to provide financing 
that keeps American workers employed. It is personal to them.
    If confirmed, it would be a privilege to continue working with such 
a fine group of people.
    Thank you.
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
               PREPARED STATEMENT OF KATHERINE M. O'REGAN
     To Be an Assistant Secretary, Department of Housing and Urban 
                              Development
                           September 10, 2013
    Chairman Johnson, Senator Crapo, and Members of the Committee, I am 
honored to appear before you today as you consider my nomination as the 
Assistant Secretary for the U.S. Department of Housing and Urban 
Development's Office of Policy Development and Research. I would like 
to start by acknowledging and thanking family members and friends here 
today, both physically and virtually. In addition to those watching 
from a distance, my brother Bill O'Regan and his oldest child, Bill, 
are seated behind me. And watching with several sisters from her home 
in Rhode Island, I want to specifically acknowledge my mother, Mary 
O'Regan, whose own career so greatly shaped my path to this hearing. 
Through her work in public health, and my father's work in education, I 
was taught the tremendous importance of public service.
    My mother is a nurse who spent most of her professional career 
running a community health clinic located within a HUD-funded public 
housing project in Providence. I spent formative years witnessing the 
importance of place--how neighborhoods and communities matter in the 
lives of families--and how very important well-designed public policies 
and well-run community institutions can be.
    My career has focused on such communities, institutions, and 
policies. Let me briefly highlight three aspects of my background most 
relevant for this position that also shed light on how I see the 
office's role.
    First, my training and research are well aligned with HUD broadly 
and this office specifically. For more than 20 years, I have taught and 
conducted research on a range of issues related to housing policy, 
urban areas, and community development. This includes work focused on 
how and why neighborhoods and communities change, what policies might 
drive economic improvements, and research evaluating the various 
effects of housing policies. As an economist who does quantitative 
work, I understand the role of the economic affairs division, and use 
the data it collects and maintains. As a researcher whose own work 
speaks directly to policy, I appreciate the critical contribution of 
this department in driving sound data-based policy decisions. Part of 
the department's charge is to link to the broader research community, 
of which I am a long-standing member.
    Second, the office of Policy Development and Research has a much 
broader and more important set of constituents, namely the wide array 
of Federal, State, and local actors in the housing and community 
development fields. I have been actively engaged with members of these 
groups far beyond my research, from advising and collaborating with 
city and State agencies, to formal and informal work with community 
development and based organizations. These experiences provide me with 
a much greater understanding of their needs, and how HUD may better 
serve them.
    Finally, I have extensive administrative and managerial experience. 
Over my career, I have undertaken a range of leadership roles, 
including more than a decade leading the largest Master's program at 
NYU's Wagner School of Public Service. My most significant managerial 
role was as Associate Dean of Faculty, during a time of momentous 
change at the school and the university. This position required working 
collaboratively within the school, across the university, and 
externally with key stakeholders. I chose to do this work because 
having well-run institutions matters, and having managed has improved 
how I think about the design of effective policies.
    I believe in HUD's mission of creating and supporting cohesive and 
economically healthy communities. Doing so requires the data and 
knowledge to make sound, evidence-based choices about using our limited 
resources well, and this is the department's main role: to create such 
knowledge, and to participate in policy decisions that make good use of 
evidence. Secretary Donovan has emphasized this approach in his tenure, 
even highlighting its importance to the continued transformation of HUD 
itself. If confirmed, I look forward to working tirelessly on this 
goal, with the Secretary, Administration, and Members of this 
Committee.
    I would be honored to serve. Thank you and I look forward to your 
questions.






















       RESPONSES TO WRITTEN QUESTIONS OF SENATOR JOHNSON
                   FROM KATHERINE M. O'REGAN

Q.1. Dr. O'Regan, for the past few years, PD&R has been working 
on a Congressionally mandated Indian Housing Needs Survey. This 
survey is the first comprehensive study of the deep housing 
needs facing Indian Country since 1996. HUD faced some 
criticism from Tribes as it launched the survey, and has since 
worked to be more responsive. Going forward, will you commit to 
working with Tribes and us in Congress to ensure that the study 
stays on track and to maintaining consultation with Tribes?

A.1. Yes. HUD recognizes and commits to a Government-to-
Government relationship with federally recognized tribes. The 
study in question is a report on the incidence of housing needs 
among Native Americans, Alaska Natives, and Native Hawaiians, 
and was mandated by the Senate report language in an 
appropriations act. For this study, it is necessary to survey 
in-person residents of reservations governed by the sovereign 
tribes, and the explicit consent of the tribal authorities that 
were randomly selected for the survey is imperative. Further, 
the Office of Policy Development and Research (PD&R) has 
consulted extensively with elected tribal leaders and tribally 
designated housing entities at meetings of their national and 
regional organizations. At all times, PD&R has been mindful of 
the need for consultation with the tribes that will be 
surveyed, and we have to date obtained excellent cooperation 
with most tribal governments. So far, all but one have agreed 
to participate. This cooperation will continue to be of prime 
importance in the completion of the survey, and we will 
conscientiously consult with the relevant tribal leadership.
    HUD will work with the Members of the Committee to try to 
resolve any issues that might threaten the timely release of 
objective findings from this very important study.
                                ------                                


        RESPONSES TO WRITTEN QUESTIONS OF SENATOR CRAPO
                   FROM KATHERINE M. O'REGAN

Q.1. Economic analyses play a very important role in the 
drafting and implementation of Federal agency rulemakings. The 
Regulatory Flexibility Act was passed by Congress to ensure 
that any proposed regulations do not have a disproportionate 
regulatory burden on small businesses and small entities. This 
rule is very important to ensure that small business viewpoints 
and perspectives are taken into consideration by Federal 
agencies when drafting and implementing regulations and to 
calculate any potential burdens.
    What are your thoughts about the Regulatory Flexibility Act 
and what role does the Office of Policy Development and 
Research play in helping the Department to comply with the law?

A.1. I agree that the Regulatory Flexibility Act plays an 
important role in the Federal rulemaking process to keep 
agencies focused on the potential compliance burdens faced by 
small businesses and similar entities. The Office of Policy 
Development and Research (PD&R) is responsible, in cooperation 
with the HUD program offices promulgating the rules, for 
drafting the Initial and Final Regulatory Flexibility Analyses 
required by the Regulatory Flexibility Act when HUD issues a 
rule having a significant economic impact on a substantial 
number of small entities.

Q.2. Executive Order 12866 requires Federal agencies to conduct 
cost/benefit analyses for ``significant regulatory actions'' 
that may have an annual effect on the economy of $100 million 
or more or adversely affect the economy in a material way.
    What are your thoughts about Executive Order 12866 and what 
role does the Office of Policy Development and Research play in 
helping the Department to comply with the Executive order?

A.2. I believe it is very important for Federal agencies to be 
cognizant of the full economic effects of regulations, both 
positive and negative, and that Executive Order 12866 and its 
implementing guidance provide agencies with firm and thorough 
guidance on how to do so. The Office of Policy Development and 
Research (PD&R) is responsible, in cooperation with the HUD 
program offices that promulgate rules, for drafting the 
Regulatory Impact Analyses for economically significant 
regulations as required by the Executive order. As part of the 
rulemaking process, PD&R staff also work with the program 
offices to examine alternative approaches to help select the 
approach that achieves the regulatory objective while imposing 
the lowest compliance costs.

Q.3. President Obama issued Executive Order 13563 to improve 
the regulatory process and regulatory review. Specifically, the 
Executive order ``must identify and use the best, most 
innovative, and least burdensome tools for achieving regulatory 
ends'' taking into account benefits and costs, both 
quantitative and qualitative.
    What are your thoughts about Executive Order 13563 and what 
role does the Office of Policy Development and Research play in 
helping the Department to comply with the Executive order?
A.3. I believe that Federal rulemaking should always be guided 
by clear analysis and consideration of effectiveness and 
compliance costs. The Office of Policy Development and Research 
(PD&R) is responsible, in cooperation with the HUD program 
offices that promulgate the rules, for producing the analyses 
required for rules to be cleared by the Office of Information 
and Regulatory Affairs in the Office of Management and Budget. 
These analyses include evidence that demonstrate how HUD 
examined the available means for achieving the regulatory 
objective in the most innovative and least burdensome way as 
required by Executive Order 13563.


                           
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