[Senate Hearing 116-130]
[From the U.S. Government Publishing Office]
S. Hrg. 116-130
NOMINATIONS OF MITCHELL A. SILK, BRIAN D. MONTGOMERY, DAVID C. WOLL,
JR., JOHN BOBBITT, AND PETER J. CONIGLIO
=======================================================================
HEARING
BEFORE THE
COMMITTEE ON
BANKING,HOUSING,AND URBAN AFFAIRS
UNITED STATES SENATE
ONE HUNDRED SIXTEENTH CONGRESS
FIRST SESSION
ON
NOMINATIONS OF:
MITCHELL A. SILK, OF NEW YORK, TO BE ASSISTANT SECRETARY FOR
INTERNATIONAL MARKETS, DEPARTMENT OF THE TREASURY
__________
BRIAN D. MONTGOMERY, OF TEXAS, TO BE DEPUTY SECRETARY, DEPARTMENT OF
HOUSING AND URBAN DEVELOPMENT
__________
DAVID C. WOLL, JR., OF CONNECTICUT, TO BE ASSISTANT SECRETARY FOR
COMMUNITY PLANNING AND DEVELOPMENT, DEPARTMENT OF HOUSING AND URBAN
DEVELOPMENT
__________
JOHN BOBBITT, OF TEXAS, TO BE ASSISTANT SECRETARY FOR ADMINISTRATION,
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
__________
PETER J. CONIGLIO, OF VIRGINIA, TO BE INSPECTOR GENERAL, EXPORT-IMPORT
BANK
__________
NOVEMBER 20, 2019
__________
Printed for the use of the Committee on Banking, Housing, and Urban
Affairs
Available at: https: //www.govinfo.gov /
__________
U.S. GOVERNMENT PUBLISHING OFFICE
39-482 PDF WASHINGTON : 2020
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COMMITTEE ON BANKING, HOUSING, AND URBAN AFFAIRS
MIKE CRAPO, Idaho, Chairman
RICHARD C. SHELBY, Alabama SHERROD BROWN, Ohio
PATRICK J. TOOMEY, Pennsylvania JACK REED, Rhode Island
TIM SCOTT, South Carolina ROBERT MENENDEZ, New Jersey
BEN SASSE, Nebraska JON TESTER, Montana
TOM COTTON, Arkansas MARK R. WARNER, Virginia
MIKE ROUNDS, South Dakota ELIZABETH WARREN, Massachusetts
DAVID PERDUE, Georgia BRIAN SCHATZ, Hawaii
THOM TILLIS, North Carolina CHRIS VAN HOLLEN, Maryland
JOHN KENNEDY, Louisiana CATHERINE CORTEZ MASTO, Nevada
MARTHA MCSALLY, Arizona DOUG JONES, Alabama
JERRY MORAN, Kansas TINA SMITH, Minnesota
KEVIN CRAMER, North Dakota KYRSTEN SINEMA, Arizona
Gregg Richard, Staff Director
Laura Swanson, Democratic Staff Director
Matt Jones, Counsel
Brandon Beall, Professional Staff Member
Beth Cooper, Democratic Professional Staff Member
Megan Cheney, Democratic Professional Staff Member
Corey Frayer, Democratic Professional Staff Member
Cameron Ricker, Chief Clerk
Shelvin Simmons, IT Director
Charles J. Moffat, Hearing Clerk
Jim Crowell, Editor
(ii)
C O N T E N T S
----------
WEDNESDAY, NOVEMBER 20, 2019
Page
Opening statement of Chairman Crapo.............................. 1
Prepared statement........................................... 25
Opening statements, comments, or prepared statements of:
Senator Brown................................................ 3
Prepared statement....................................... 26
NOMINEES
Mitchell A. Silk, of New York, to be Assistant Secretary for
International Markets, Department of the Treasury.............. 5
Prepared statement........................................... 27
Biographical sketch of nominee............................... 29
Responses to written questions of:
Senator Brown............................................ 95
Senator Reed............................................. 99
Senator Menendez......................................... 100
Senator Warren........................................... 101
Brian D. Montgomery, of Texas, to be Deputy Secretary, Department
of Housing and Urban Development............................... 7
Prepared statement........................................... 49
Biographical sketch of nominee............................... 51
Responses to written questions of:
Senator Brown............................................ 103
Senator Moran............................................ 107
Senator Reed............................................. 107
Senator Menendez......................................... 108
Senator Warren........................................... 109
Senator Cortez Masto..................................... 112
Senator Jones............................................ 115
Senator Sinema........................................... 116
David C. Woll, Jr., of Connecticut, to be Assistant Secretary for
Community Planning and Development, Department of Housing and
Urban Development.............................................. 8
Prepared statement........................................... 67
Biographical sketch of nominee............................... 68
Responses to written questions of:
Senator Reed............................................. 117
Senator Warren........................................... 118
Senator Cortez Masto..................................... 120
Senator Jones............................................ 121
John Bobbitt, of Texas, to be Assistant Secretary for
Administration, Department of Housing and Urban Development.... 10
Prepared statement........................................... 74
Biographical sketch of nominee............................... 76
Responses to written questions of:
Senator Brown............................................ 122
Senator Reed............................................. 123
Senator Warren........................................... 123
(iii)
Page
Peter J. Coniglio, of Virginia, to be Inspector General, Export-
Import Bank of the United States............................... 12
Prepared statement........................................... 86
Biographical sketch of nominee............................... 88
Responses to written questions of:
Senator Brown............................................ 125
Senator Warren........................................... 127
Senator Cortez Masto..................................... 128
Senator Sinema........................................... 130
Additional Material Supplied for the Record
Letter submitted by the Mortgage Bankers Association in support
of Brian D. Montgomery......................................... 131
Letter submitted by the National Association of Realtors in
support of Brian D. Montgomery................................. 132
(iv)
NOMINATIONS OF MITCHELL A. SILK, BRIAN D. MONTGOMERY, DAVID C. WOLL,
JR., JOHN BOBBITT, AND PETER J. CONIGLIO
----------
WEDNESDAY, NOVEMBER 20, 2019
U.S. Senate,
Committee on Banking, Housing, and Urban Affairs,
Washington, DC.
The Committee met at 10:27 a.m., in room SD-538, Dirksen
Senate Office Building, Hon. Mike Crapo, Chairman of the
Committee, presiding.
OPENING STATEMENT OF CHAIRMAN MIKE CRAPO
Chairman Crapo. All right. This hearing will come to order.
This morning, the Committee will receive testimony from
five nominees who have been selected to serve in key roles
within the Department of Treasury, the Department of Housing
and Urban Development, and the Export-Import Bank.
Going down the line, we have: Mitchell Silk, to be
Assistant Secretary for International Markets at the Department
of the Treasury; the Honorable Brian Montgomery, to be Deputy
Secretary of Housing and Urban Development; David Woll, to be
HUD Assistant Secretary for Community Planning and Development;
Jack Bobbitt, to be HUD Assistant Secretary for Administration;
and Peter Coniglio, to be Inspector General of the Ex-Im Bank.
I want to welcome all of you. I appreciate you putting up
with our having a markup first. It was actually a shorter thing
than we usually have when we do markups, and so we did not hold
you as long as we might have. I also commend each of you for
your commitment to public service and your willingness to
accept these positions.
I see friends and family behind you, and I welcome them
here today as well.
Mitchell Silk has served with distinction as Acting
Assistant Secretary of the Treasury for International Markets
since July and as Deputy Assistant Secretary for International
Affairs since 2017.
He is a leading expert in Chinese law and finance, who is
fluent in both Mandarin and Cantonese, and spent 15 years
working in Greater China as a partner with the law firm Allen &
Overy.
Since joining Treasury, Mr. Silk has been a key voice on
trade negotiations, energy and infrastructure finance, export
credit, and financial services.
Brian Montgomery is no stranger to this Committee, having
served as Federal Housing Commissioner under Presidents Bush,
Obama, and Trump, and having testified before us on seven other
occasions on matters relating to housing and housing finance.
During his previous tenure at the helm of the Federal
Housing Administration, he provided steadfast leadership
through one of the most trying times that housing markets have
ever seen.
During his current tenure at FHA, he has overseen the
return of FHA's insurance fund to its strongest financial
position since fiscal year 2007, while continuing to provide
affordable home ownership opportunities to tens of thousands of
first-time home buyers each year.
Since January of this year, Mr. Montgomery has also served
as Acting Deputy Secretary, charged with overall management of
day-to-day operations of the Department.
Once confirmed as permanent Deputy Secretary, the
Department will continue to benefit from his deep institutional
knowledge, expertise, and dedication to making our housing
programs work better.
Since November 2018, David Woll has served as Principal
Deputy Assistant Secretary for HUD's Office of Community
Planning and Development, where he has overseen HUD's homeless
assistance, disaster relief, and block grant programs.
He has dedicated his entire career to public service,
including as an Assistant U.S. Attorney, Deputy General Counsel
at HUD, and Senior Policy Adviser to the Governor of New
Jersey, where he served as the State's compliance director for
Superstorm Sandy and other relief efforts.
With direct experience both administering CPD programs and
implementing them as a State partner, Mr. Woll is well equipped
to continue leading CPD forward.
Jack Bobbitt currently serves as Deputy Assistant Secretary
for Housing Operations at HUD, where he oversees procurement,
human resources, facilities, communications, and IT systems for
the Office of Housing.
He previously served as Special Assistant to Commissioner
Montgomery during the Bush administration and has also served
in a variety of executive roles in the private sector,
including both large corporations and start-up ventures.
If confirmed, Mr. Bobbitt would combine his keen
understanding of HUD operations with decades of private sector
experience as he oversees HUD facilities, procurement,
staffing, training, and performance management.
Finally, Peter Coniglio would bring a wealth of relevant
experience to the Ex-Im Bank IG office, having served in the
Office of Inspector General at the General Services
Administration since 2006, in addition to other distinguished
service within the Department of Justice, the Department of
Treasury, and the Senate Judiciary Committee.
In meetings with my office, Mr. Coniglio has committed to
running a ``fully functioning, independent, regular order''
operation at the Ex-Im Office of Inspector General.
In only a few months in office since their Senate
confirmation, the new Ex-Im President Kimberly Reed and her
colleagues on the board have already taken significant steps to
bring greater transparency and accountability to the Bank. This
has not gone unnoticed by many of us on the Committee. Having a
new Senate-confirmed Inspector General in place will only serve
to strengthen those efforts.
Each of these nominees are highly distinguished and well
qualified to serve in the roles to which they have been
nominated.
I look forward to working with each of you in the months
ahead to advance the aims of your agencies and to expand our
economic growth.
Thank you once again for your willingness to serve and for
appearing before the Committee today, and I encourage my
colleagues to expeditiously confirm all five of you so that you
can quickly get to work for the American people.
Senator Brown.
OPENING STATEMENT OF SENATOR SHERROD BROWN
Senator Brown. Thank you, Mr. Chairman, for holding the
hearing on the nominations of Mr. Silk, Mr. Montgomery, Mr.
Woll, Mr. Bobbitt, and Mr. Coniglio. Welcome to you and your
families and guests. I am glad you are here.
President Trump nominated Mitchell Silk to be Assistant
Secretary for International Markets at Treasury. His portfolio
is broad--from energy and infrastructure issues, to trade
negotiations with China and global financial risks at the
Financial Stability Board.
China has recognized the global demand for updated
infrastructure investments and is making significant
investments in infrastructure around the world through its Belt
and Road Initiative. However, concerns have arisen--about the
terms provided, the failure to use local workers, and the
quality of the work completed.
The appetite for Belt and Road makes clear that we need to
increase support for investments abroad in order to provide the
world with a market-based alternative to China, one that
respects workers and is focused on sustained, local growth and
not on the expansion of Chinese influence.
U.S. leadership in infrastructure development requires
acting to address the threats we face from climate change. If
confirmed, Mr. Silk, in spite of the Trump administration's
comments and recent actions, I hope you will focus on those
efforts.
We will also hear from Mr. Coniglio, the nominee to be
Inspector General at Ex-Im Bank. A confirmed Inspector General
will help ensure transparency and accountability in the Bank's
operations. Mr. Coniglio's nomination is not the only Ex-Im
nomination that we need to act on.
The full Senate needs to vote on the nominations of Paul
Shmotolokha and Claudia Slacik whom our Committee has
previously reported with strong bipartisan support. We need a
full Ex-Im board and a qualified Inspector General to provide
oversight and guidance as Ex-Im approves deals that create jobs
in Ohio and around the country. We know that the undermining of
Ex-Im by the Administration and by the Majority Leader has made
that challenge much greater. And, Mr. Coniglio, I was pleased
you said in your statement that Senator Grassley taught you
that whistleblowers, the time-honored, bipartisan nature of
whistleblowers, that they are to be respected and taken
seriously. Thank you for adding that.
Finally, three of today's nominees have been nominated to
positions within HUD, where they are currently serving.
Mr. Montgomery has been in front of this Committee before,
currently serves in a confirmed role as Assistant Secretary for
Housing--Federal Housing Commissioner and has been nominated to
serve as Deputy Secretary.
Mr. Woll has been nominated to be Assistant Secretary for
Community Planning and Development and has experience in
monitoring compliance with the CDBG Disaster Relief, which he
would oversee if confirmed.
Mr. Bobbitt has been nominated to serve as Assistant
Secretary for Administration, where he would be responsible for
overseeing hiring policies, procurement, and operations.
HUD provides housing assistance to 4.7 million low-income
families and supports homeless services. It also enforces the
Fair Housing Act, insures some 8.1 million mortgages, and
administers billions in assistance to communities hit hard by
natural disasters.
HUD's policies affect every community, big and small. A
home is a foundation for opportunity. It is usually the biggest
item in a family's budget. Hardworking families and the
Nation's most vulnerable members rely on these critical
programs and protections.
Unfortunately, President Trump's administration does not
seem to understand that. When 11 million families spend more
than half their income on housing, we need to be doing more.
The Trump administration has year after year proposed to slash
HUD's budget and eliminate programs like CDBG and HOME that
make affordable housing development possible.
The Administration has released a document questioning
long-established best practices to address homelessness. Just
last week, the Trump administration removed the widely
respected head of the interagency council responsible for
coordinating Federal agencies' homelessness efforts.
HUD wants to undermine the enforcement of the Fair Housing
Act based on disparate impact and to weaken protections for
transgender individuals who need shelter.
Last week, HUD promoted a political appointee with a
history, a very well known history, of sexist and racist
writings to the second highest position at Ginnie Mae, a
nonconfirmable position, which guarantees--as you know, Ginnie
Mae guarantees $2.1 trillion in mortgage-backed securities.
And just a few months ago, HUD proposed changes to the FHA
program that would make it harder for millions of families to
afford to buy a home.
Each of these actions is troubling, each on its own. Taken
together, it is pretty clear that not only is the President not
doing anything to help families afford a home, but they are
actively making it harder, thereby betraying American families.
Both Mr. Woll and Mr. Montgomery have played a role in some
of these policies and decisions. I expect to hear more about
that in today's hearing.
These positions play a critical role in many of the
economic issues that our country faces. Thank you.
Chairman Crapo. Thank you.
At this point I would like to put each of you under oath
and then ask you one question, so would you please stand and
raise your right hands? Do you swear or affirm that the
testimony you are about to give is the truth, the whole truth,
and nothing but the truth, so help you God?
Mr. Silk. I do.
Mr. Montgomery. I do.
Mr. Woll. I do.
Mr. Bobbitt. I do.
Mr. Coniglio. I do.
Chairman Crapo. And do you agree to appear and testify
before any duly constituted committee of the Senate?
Mr. Silk. I do.
Mr. Montgomery. I do.
Mr. Woll. I do.
Mr. Bobbitt. I do.
Mr. Coniglio. I do.
Chairman Crapo. Thank you. That was an ``aye'' on all parts
on each question.
With that, let us proceed. We will proceed in the order you
were introduced, and I encourage you to remember the 5 minutes
that has been allocated to you for your introductory remarks.
Your written testimony is made a part of the record.
Mr. Silk.
TESTIMONY OF MITCHELL A. SILK, OF NEW YORK, TO BE ASSISTANT
SECRETARY FOR INTERNATIONAL MARKETS, DEPARTMENT OF THE TREASURY
Mr. Silk. Chairman Crapo, Ranking Member Brown, and
distinguished Members of the Committee, it is a great honor to
appear before you today as the President's nominee to be
Assistant Secretary of the Treasury for International Markets.
I thank the President and Secretary Mnuchin for their trust and
confidence in me. I thank very much all of your good offices
for the courtesies afforded to me over the past few weeks. If
confirmed, I look forward to working with all of you on the
critical issues within Treasury's International Markets
portfolio.
As a backdrop to my remarks, I wish to acknowledge my
family, including my extraordinary grandparents and parents who
are no longer with us. It is at times like this that the
feeling of loss are tremendous and tempered only by their
immense inspiration that I will detail in a moment. My amazing
wife, Yocheved Rivka, is here with me today. She serves our
community as a physician's assistant in a family practice in
Brooklyn while looking after our eight children and doting on
our three grandchildren. She is a constant source of
inspiration, support, and strength. She is joined by her
father, Rabbi Duvid Orlander, and four of our eight children:
Meshulam, Naftuli Chaim, Mordechai Dov, and Tauba Raitza.
I owe the privilege of appearing before this distinguished
Committee to my family and to the opportunities that this great
country has afforded us. My grandparents immigrated to this
country from hardship and persecution in Eastern Europe. Their
life experiences were chilling. My maternal grandfather, the
guiding light of my life, grew up in abject poverty, witnessed
Cossacks brutally murder members of his family, and struggled
to cope with the extermination of his family in the Holocaust.
For my family, this country represented freedom, security, and
immense opportunity. They worked hard as tradesmen and
laborers.
Their life challenges enforced their commitment to
improving the lives of others. My grandfather spoke with pride
of his communal leadership, including his part in successfully
lobbying for one of Chicago's first projects to provide
subsidized housing for over 1,000 impoverished European
families during the Great Depression. My father was proud to
have served in the Second World War in the Pacific Fleet. His
brother, my uncle, served in the Army National Guard. My mother
assisted the lives of thousands over her 40-year nursing
career.
Family circumstances required me to go to work full time
when I was 13. My first job was in a Chinese restaurant as a
dishwasher, then prep cook, and then after busboy and finally
waiter. My hard work yielded fluency in Chinese and sufficient
earnings to fund college and law school. I was the first one in
my family to graduate from college.
I enjoyed an extraordinary and exciting career in law for
more than 30 years in both the United States and in Asia. I
specialized in large and complex cross-border investment, bank
regulatory and finance matters, focusing heavily on energy and
infrastructure. Like my grandparents and parents, service to
the community was a priority for me. While in private practice,
I served for over a decade as chairman of a nationwide pro bono
legal services network of more than 400 lawyers.
I joined the Treasury Department as Deputy Assistant
Secretary for Investment, Energy, and Infrastructure in 2017.
Over the last 2 years, I have had the honor of advancing our
country's interests alongside Treasury leadership and our
exceptionally dedicated career staff.
Treasury's International Markets portfolio is critical to
advancing U.S. interests in global financial and investment
markets. We lead engagement in international regulatory bodies
and coordinate trade policy with respect to financial services.
We also oversee Treasury's technical assistance program, which
assists our allies globally. In addition, the portfolio covers
the critically important areas of U.S. participation in
development financing, including implementation of the BUILD
Act and trade finance globally. And we lead Treasury's efforts
to promote private capital solutions in energy and
infrastructure finance to support responsible global growth, a
critical initiative which I designed and have overseen since
joining the Department.
My work at Treasury and in private practice has given me a
deep appreciation for how these international economic issues
have a significant impact on the lives of individual Americans.
It has been and will continue to be an honor to come full
circle and play my part to ensure the continued freedom,
security, and immense opportunity that this country afforded my
family. If confirmed, I will work closely with this Committee
to continue these essential tasks.
I thank you for the opportunity to appear today, and I am
very happy to answer questions.
Chairman Crapo. Thank you, Mr. Silk.
Mr. Montgomery.
TESTIMONY OF BRIAN D. MONTGOMERY, OF TEXAS, TO BE DEPUTY
SECRETARY, DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
Mr. Montgomery. Thank you, Chairman Crapo, Ranking Member
Brown, and Members of the Committee. I am honored to appear
before you today to be considered for the position of Deputy
Secretary at the Department of Housing and Urban Development.
I would like to take a moment to thank my family, including
my wife, Katy, who is on business travel today, but I do have
my two children, Emily, age 13--whom I am probably blocking
out, I suspect--and Thomas, age 10, who will quickly tell you
he will be 11 next month. I want to also thank my parents and
my sisters for their love and support over the many years. My
Dad passed away right before my confirmation hearing in 2017,
but my Mom, who is the daughter of Mexican immigrants, is
watching at her home in Houston on line.
I also want to express my gratitude to the President and to
Secretary Carson for their faith and confidence in me as I
worked as FHA Commissioner over the last 19 months.
I would say working with Secretary Carson over that time
has provided me with a new understanding of what it truly means
to serve.
Mr. Chairman, I was humbled by the trust this Committee
placed in me to serve as FHA Commissioner from 2005 to 2009 and
again in this Administration. I have always believed that the
work we do at HUD and FHA transcends party lines.
During my tenure at HUD, which has spanned 6 years, three
Administrations, and both parties, I am proud of the work we
did to preserve FHA as a viable option for home buyers.
Just last week I was pleased to present HUD's Annual Report
to Congress regarding the status of FHA's Mutual Mortgage
Insurance Fund for fiscal year 2019.
The MMI Fund is as sound as it has been in over a decade
with a capital ratio of 4.84 percent. FHA remains a key source
of financing for first-time and minority home buyers, with
hundreds of thousands of individuals and families achieving the
dream of home ownership, and nearly a third of all endorsements
supporting minority home buyers.
One way we have sought to strengthen FHA has to been to
clarify regulatory expectations so that responsible lenders can
confidently and fully participate in the program.
For example, market participants' concerns about uncertain
and unanticipated False Claims Act liability for underwriting
defects has led many depository lenders to largely withdraw
from FHA lending. To address these concerns, in October HUD and
the Justice Department signed a Memorandum of Understanding for
cases brought under the False Claims Act against FHA lenders.
This MOU provides a framework to apply remedies for FHA lender
violations in a consistent, uniform, and appropriate way. In
addition, FHA updated its certifications and what we refer to
as the ``defect taxonomy'' to better assess the appropriate
remedies for program violations. This suite of reforms should
make affordable FHA mortgages more accessible to qualified
borrowers and reduce risks within the FHA program.
We are also working to expand and strengthen loss
mitigation options for borrowers. Under my tenure, FHA made
permanent the ``Disaster Standalone Partial Claim'' for
disaster victims who are rebuilding or buying another home
following a disaster. This option covers up to 12 months of
missed mortgage payments with an interest-free second loan on a
recovering family's home. And, by the way, this is a program
that we deployed in Puerto Rico last year to help FHA
borrowers.
In recent years, FHA has been asked to play a greater role
in long-term recovery after natural disasters. If confirmed as
Deputy Secretary, I want to give you my pledge that we will do
everything we can to help the people impacted by the hurricanes
that ravaged so many States, from my hometown of Houston to
North Carolina and, yes, Puerto Rico, as well as the most
recent wildfires in California.
In 2017, for the first time in the history of HUD's
administration of disaster recovery, Congress provided
mitigation funds as part of a CDBG-DR appropriation. To deliver
on this mission, I have visited Puerto Rico to meet with the
island's leadership and with the officials at Vivienda who are
responsible for administering this grant. We are committed to
ensuring the record funding going to Puerto Rico reaches the
people in need and helps them recover and build a more
resilient future.
I further note that HUD has one of the most tenured
workforces in the Federal Government, and its head count has
decreased by more than 50 percent over the last 25 years. It is
a priority that we have the right workforce to fulfill HUD's
important missions in the years to come, and we are working
hard to make that happen.
Finally, HUD's housing finance reform plan, released in
September, calls for additional improvements to FHA's policies,
technology, and operations, and we look forward to working with
the Congress as we move that forward.
I want to thank you again for your time this morning. I
look forward to answering your questions.
Chairman Crapo. Thank you, Mr. Montgomery.
Mr. Woll.
TESTIMONY OF DAVID C. WOLL, JR., OF CONNECTICUT, TO BE
ASSISTANT SECRETARY FOR COMMUNITY PLANNING AND DEVELOPMENT,
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
Mr. Woll. Thank you, Chairman Crapo, Ranking Member Brown,
and distinguished Members of this Committee. I am deeply
honored to be nominated to serve as Assistant Secretary of the
U.S. Department of Housing and Urban Development's Office of
Community Planning and Development.
If I may, I would first like to introduce my family, who
are the most important people in my life. I am happy to
introduce my wife of 23 years, Phoebe Cabell Woll. I would also
like to introduce my three children: my oldest son, Tripp, who
is a senior at Pennsylvania State University; Ted, who is a
junior at the University of Wisconsin; and my youngest, Bryce,
who is a sophomore in high school.
I would also like to introduce my Dad, David Woll, who has
been my mentor both as a father and as a lawyer. My Dad and my
Mom, who I wish was still with us today, taught me the
importance of faith, values, and treating every person,
regardless of their background or circumstances, with
compassion, dignity, and respect.
My brother, Mike, is also here with his wife, Anita Woll. I
cannot thank them enough for their tremendous support. My
sisters Eileen and Francie were unable to travel here today,
but they too have always been very supportive of me, and I am
profoundly grateful for their love and encouragement.
My path to nomination and this confirmation hearing has
been somewhat untraditional. After graduating from the
University of Maryland and the University of Virginia School of
Law, I spent most of my earlier career as an investigator and
prosecutor working to protect victims of crime.
At the Securities and Exchange Commission, I was a senior
counsel in the Enforcement Division, where one of my largest
matters was a securities fraud case involving a securities
boiler room that targeted unsophisticated and elderly
investors.
At the U.S. Attorney's Office for the District of Columbia,
I spent 3 years prosecuting domestic violence and sexual
assault cases against people who victimized some of the most
vulnerable people in the community, including children,
indigent women who had been trafficked, and young people who
were LGBTQ. I also served as a Federal prosecutor in Brooklyn,
where I prosecuted business and securities fraud cases in which
the victims were financially devastated due to the greed of
others who took advantage of them. This included prosecuting a
$100 million Ponzi scheme and a Hurricane Katrina fraud case.
Following Superstorm Sandy in the fall of 2012, I had an
opportunity to do something completely different, which was to
work on disaster recovery for the State of New Jersey. That was
an important moment in my career because it ended up being my
first exposure to HUD and the dedicated career staff who work
for its Office of Community Planning and Development. It struck
me then, as it does now, that CPD genuinely cares about
disaster victims, the unsheltered homeless, and others in need
and works incredibly hard to help grantees navigate through
very stressful and difficult circumstances. I feel particularly
privileged to be considered to lead this incredibly talented
team.
There is always, however, room for improvement,
particularly when it comes to better serving the States and
communities who are our grantees. With this in mind, I have
several priorities if I am confirmed.
First, CPD needs to continue to strengthen its stewardship
of the Disaster Recovery Program by making sure we have the
right number of people in the right places. To that end, we are
in the process of doubling the size of the disaster recovery
division and out-stationing staff closer to our grantees. This
will help us to deliver grant assistance in a more efficient
manner and give us greater flexibility to respond to the unique
needs of each State and grantee.
Second, CPD needs to work with other agencies, States,
municipalities, and the private sector to develop strategies to
target unsheltered homelessness. This effort is similar to what
we did when we targeted veterans' and family homelessness,
which led to decreases in both numbers.
Third, our many field offices are on the front line and
play a critical role in forging relationships with our
grantees. We need to reshape our field operations in order to
improve communications between headquarters and the field and
to give the field offices greater flexibility to react to the
changing needs of our grantees.
Members of the Committee, I have always worked to help
those who are vulnerable and most in need. If confirmed, I
commit to you that I will continue to do so as the Assistant
Secretary of CPD. Thank you.
Chairman Crapo. Thank you, Mr. Woll.
Mr. Bobbitt.
TESTIMONY OF JOHN BOBBITT, OF TEXAS, TO BE ASSISTANT SECRETARY
FOR ADMINISTRATION, DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
Mr. Bobbitt. Chairman Crapo, Ranking Member Brown, and
distinguished Members of the Committee, it is a privilege to
appear before you this morning. I am deeply honored that
President Trump has nominated me to serve under Secretary
Carson as the Assistant Secretary for Administration at the
Department of Housing and Urban Development.
Before I begin, I want to express my deepest appreciation
to my beautiful wife, Jian, who is here today. Jian has been,
and continues to be, a bedrock of support, the love of my life
for me and our family while I serve at HUD. She is here today
from our hometown of Houston, where she has maintained our
residence to provide care for my mother and father, George and
Bette Bobbitt.
I want to thank my father, a Navy veteran of World War II,
and my mother, who worked for the British Army Staff here in
Washington, D.C., They met at a USO dance during the war and
have been married for 72 years. At 97 and 96 years old, they
are the source of my passion to succeed personally and
professionally. I also want to acknowledge my grandfather, Dr.
Clarence Charles Hastings, a prominent veterinarian and World
War I veteran who instilled in me strong values and a work
ethic required to succeed. And, finally, I want to thank my
stepdaughter Xaioting, Mike Fei, sister Robin, and our extended
family, friends, and colleagues for their love and support.
During my 37 years of business experience, I have served in
diverse executive roles in the private and public sectors
responsible for operations, finance, sales, and marketing for
large multibillion-dollar corporations to startup ventures.
My Government and public service journey began in 1984 as a
volunteer White House Lead Advance Representative. I served in
that capacity under the George H.W. Bush and George W. Bush
administrations, and I have served in that role in the Trump
administration. I also served as the Director of Strategic
Communications at HUD from 2006 to 2009 and had the privilege
to return to HUD in February 2019 as the Deputy Assistant
Secretary for Operations, managing human resources, procurement
and facilities within the Office of Housing, HUD's largest
office. During my time in this position, I have established
core values, an open-door policy, met with many of my
employees, restructured the management team, and increased our
FEVS score card of leadership by 23 percent and overall
employee satisfaction by 17 percent. We also created and
launched a comprehensive Employee Development Training Program.
My knowledge of HUD and Government operations has given me
a sound perspective on what is required to achieve success in
the work ahead, both from the organization and from myself.
Additionally, my relevant skills and extensive experience
obtained from the private sector will aid in implementing
improved and more efficient processes.
I believe that a leader's management philosophy is the
cornerstone for the organization's direction, vision, goals,
and success. As a leader, I am committed to the development and
advancement of three things: people, processes, and
performance.
I believe you manage work, but you lead people. I believe
in an employee-centered organization that strives to achieve
high morale with a positive, accountable culture that develops
individuals for career growth and opportunities.
Next is the efficiency and effectiveness of the processes
that are adopted. A focus must be placed on clearly identifying
and streamlining processes and policies.
Finally, my emphasis is on performance. I believe that an
organization that properly sets standards of measurement,
creates attainable goals, and empowers staff to achieve them is
bound for high performance.
So with these as my guiding philosophy, here are the
priorities I will focus on if confirmed as HUD's Assistant
Secretary for Administration:
First, I will implement a culture and set of core values as
well as ``career-long'' employee training that will foster
employee development and succession planning.
Second, I will focus on improving the hiring process by
working to decrease the time it takes to hire and reduce the
risks associated with critical vacancies.
Third, I will introduce measures to decrease the prolonged
process of procurement and ensure qualified oversight of
existing contracts.
And, finally, the modernization of HUD's hiring, training,
and procurement IT systems to enhance accuracy, accountability,
and the ability to effectively measure performance.
Mr. Chairman, distinguished Members of the Committee, thank
you again for your consideration of my nomination. I welcome
your questions.
Chairman Crapo. Thank you, Mr. Bobbitt.
Mr. Coniglio.
TESTIMONY OF PETER J. CONIGLIO, OF VIRGINIA, TO BE INSPECTOR
GENERAL, EXPORT-IMPORT BANK OF THE UNITED STATES
Mr. Coniglio. Thank you, Mr. Chairman, Ranking Member
Brown, and Members of the Committee, for inviting me to appear
before you today. It is my great honor and privilege to be the
President's nominee to be the Inspector General of the Export-
Import Bank of the United States. I am very humbled to be
considered for this position.
With me today is my wife of 42 years, Jamie Wright
Coniglio. She is my rock. Over the last 30 years, I spent 5
years on Capitol Hill, highlighted by my work as a line counsel
for Senator Grassley's then Judiciary Subcommittee staff and
about 14 years with the Departments of Justice and the
Treasury. Since June of 2006, I have been in the Office of
Inspector General at the General Services Administration,
working for three Inspectors General. Each of them tutored me
on how to be an effective Inspector General.
In addition to my present position with GSA OIG, I headed
for almost 4 years the OIG's Compliance Office, reporting
directly to the GSA Inspector General. From there, I stood up
the GSA OIG's first-ever audit report writing and editing team.
As the lead editor, I oversaw the production of the OIG's audit
reports--OIG's first line of communication with its agency. Our
team's objective was to ensure that an audit report was
readable, objective, and usable.
Throughout its history, Ex-Im's unique mission has helped
finance the export of American goods and services in order to
support American jobs.
If confirmed, my goal will be to provide Ex-Im's leaders
with timely and objective findings and understandable and
usable recommendations regarding the agency's programs and
operations and to inform Ex-Im's leaders of any fraud, waste,
or abuse the OIG uncovers.
If confirmed, I commit to overseeing rigorous
investigations to pursue the facts wherever they may lead.
As a Senator Grassley alum, he set the standard for me,
among many, when it comes to Inspectors General and educated me
on the key role an OIG plays in an agency's success.
Senator Grassley also taught me that whistleblowers are to
be respected and taken seriously.
If I am confirmed, I will ensure that the Office of
Inspector General at Ex-Im has an open-door policy and provides
every opportunity for those who want to report on information
that they may have on any waste, fraud, or abuse occurring at
Ex-Im. If I am confirmed, the Office of Inspector General will
see to it that whistleblowers receive every protection afforded
to them by the law.
I am also well aware of Congress' role in the responsible
use of taxpayers' resources. If confirmed, I intend to maintain
a strong and open line of communication with this Committee,
the Senate, and the House of Representatives.
Mr. Chairman, my time with GSA OIG has attuned me to the
role that a fully functioning, objective, and independent
Office of Inspector General plays in an agency's success. I
call this ``regular order.''
I understand Ex-Im has strong supporters and strong
detractors. As you know, Ex-Im's Board of Directors has only
recently returned to regular order with a quorum.
This is all the more reason to return Ex-Im's Office of
Inspector General to its own regular order. Since the Ex-Im
Inspector General position became vacant in June of 2014, the
OIG's dedicated professionals have supported its continued
operations. But Senate-confirmed leadership in an independent
Office of Inspector General is more likely to have greater
influence on Ex-Im and more likely to have the confidence of
Ex-Im's proponents, as well as its detractors.
My approach as Inspector General would not be to act as Ex-
Im's adversary or its enemy. Instead, I would intend to foster
a healthy, productive, and open professional relationship with
Ex-Im.
In conclusion, Mr. Chairman, if I am fortunate enough to be
confirmed, I firmly believe that I am prepared to take the helm
of the Office of Inspector General at the Export-Import Bank of
the United States, and I look forward to the challenge.
Thank you for your time today, and I will be pleased to
respond to any questions you may have.
Chairman Crapo. Thank you very much, Mr. Coniglio.
I would like to again state that I believe that each of
you, all five of you, are very superbly qualified and
outstanding candidates for the positions to which you have been
nominated and that I intend to support you. I do not want you
to feel slighted, but I do not have any questions for you
except for a couple that I want to give to Mr. Montgomery.
Mr. Montgomery, my questions for you are--first, I commend
your work on HUD's recent blueprint for housing finance reform
and your staff's ongoing work with mine on that topic. As you
know, it is a top priority of mine to ensure that our housing
finance system protects taxpayers, increases the role of
private capital, and promotes broad accessibility to mortgage
credit, and FHA and Ginnie Mae play a key role in that.
I mainly want your commitment to continue working with me
on this and then would invite any comments you would like to
make on housing finance reform.
Mr. Montgomery. Well, thank you very much for that
question, Chairman Crapo, and your comments. The Administration
worked very hard with our friends at Treasury and elsewhere to
put together what we think is meaningful housing finance
reform. As you will recall, in the report we have listed some
of the activities we would like to undertake in both
legislative and administrative categories, including some
things that we have been considering and working on that we
felt strongly we should include just to signal to the world
that we are working on some things in an effort of
transparency.
I can speak obviously for FHA and for Ginnie Mae. It is
important as the pure Government home-buying program that has
been the hallmark of first-time home buyers since 1935, we want
to help ensure that FHA is there in good times and bad. That is
not to say--the news of last week was very welcomed with a
capital ratio the highest it has been since 2007. In our
report, we also mention some of the challenges and headwinds
that we face. We have a strong housing market today, but it is
tough to predict the future. So we want to make sure that we
are in a strong capital position, not knowing what the future
may hold, to make sure that we have, you know, a margin safely
above the 2 percent capital ratio that Congress requires.
It is also no secret that we have some serious technology
deficiencies that actually date back to my first tenure as FHA
Commissioner in the Bush and Obama administrations. The good
news is Congress has given us the first downpayment toward a
project we think will be $80 to $90 million in the form of a
$20 million downpayment. I can say that our staff working with
our CIO work extremely hard to bring FHA's technology into this
century, and we are going to see--we are working on some pilot
programs right now and proofs of concept, but we look forward,
with the input from Congress and from our stakeholders, to
putting some significant heft into our current antiquated
systems.
Chairman Crapo. Well, thank you, and I do appreciate your
attention to this and look forward to continuing to work with
you on it as we weave our way through the process of getting a
solid housing reform put into place.
My last question to you is--and I also want to commend you
for your work alongside DOJ to help establish clear rules of
the road to clarify the extent to which FHA lenders can be
liable for harmless or immaterial errors under the False Claims
Act. What has been the early response from lending institutions
to the recent FHA announcement? And do you expect to see more
lenders returning to the program?
Mr. Montgomery. Thank you again, Mr. Chairman. We have had
some good signals from the industry, including one rather large
depository that would like to get back into the FHA in a more
meaningful way. I will not revisit what happened in the last 8
to 10 years on that, but as you know, a lot of depositories
fled the FHA program. In 2010, almost half of our originations
came from depositories. Last fiscal year it was about 13.5
percent.
As I frequently say, I do not take sides in this
discussion. I just think we need to find a better balance so we
are not too extended with independence nondepository
institutions, or for depositories for that matter. So, again,
not taking sides, I just want to try to find a little bit
equilibrium, balance between the two.
This one particularly large depository had asked us if they
could help provide some training, which we will take as a
positive sign.
I do want to add that the traditional stakeholders were
very supportive of what we were doing, but we also heard a lot
of statements of support from the National Housing Conference,
the Center for Responsible Lending, the National Community
Reinvestment Coalition, who rightfully view this also as an
issue of access to credit in particulate for low- or moderate-
income first-time home buyers.
So we are optimistic going forward that we can expand the
aperture a little and hopefully get some of the depository
institutions back into the program.
Chairman Crapo. Thank you. Senator Brown.
Senator Brown. Thank you, Mr. Chairman.
Senator Reed wanted to stay. He was called to a meeting
with the Foreign Minister of the UAE and needed to go, but he
has questions for the record that he will submit.
Thank you. Good to see all of you. Thank you for bringing
your skills and your interest in public service to this
Committee. You have all been nominated for important jobs. I
really am not asking you--this is a question. I do not
understand why the Secretary of HUD has not moved more quickly
to fill these jobs like they are doing today, but, still, so
many unfilled that really, really matter.
Mr. Montgomery, thank you for serving as Deputy Secretary.
Thank you for continuing to serve as head of FHA.
Did you sign off on HUD's proposed changes to the disparate
impact rule?
Mr. Montgomery. Sir, as you know, there were some
safeguards that the Supreme Court thought that were wise to put
into the program, and I think that is a lot of what we are
hoping to accomplish with this rule. I would say that process
began before my tenure as FHA Commissioner.
Senator Brown. But did you sign off or you did not?
Mr. Montgomery. Well, sir, that process began before I got
to HUD.
Senator Brown. Well, my colleagues and I are very concerned
about these changes undermining fair housing protections and
making it all but impossible for victims of housing
discrimination to bring a disparate impact claim. Regardless of
your justification there, I do not understand why you would not
speak out about the problems there.
Mr. Woll, I appreciated in your testimony talking about
your faith, values, and treating every person--your father and
mother taught you to treat every person, regardless of
background or circumstances, with compassion, dignity, and
respect.
In September, HUD abruptly withdrew a competitive grant to
provide funding for housing and services to victims of human
trafficking. It is a terrible problem in my State, especially
in the Toledo area. This grant program was a result of a
partnership among HUD, DOJ, and other agencies, as you know,
and involved significant input from stakeholders serving
survivors.
Your process from you and HUD's process for handling this
grant frankly was a disaster. You provided no explanation to
stakeholders, including my constituents who asked, as to why
HUD abruptly canceled and suspended these grants in the midst
of the process. HUD still has not told stakeholders when and
how these funds might be awarded. HUD did not respond to my
letter seeking additional information about these funds. This
money is critical to organizations that struggle with resources
and struggle with the whole of combating human trafficking.
Can you commit to me this funding will be made available
this calendar year and that you will clearly communicate that
with applicants and with stakeholders?
Mr. Woll. Senator, with respect to committing to this year,
as you may know, the program is now going to be administered by
the Department of Justice. I have been in contact with the
Department----
Senator Brown. I am sorry to interrupt. That was after,
though, that they said they agreed to administer the grants
after HUD suspended the grants.
Mr. Woll. Yes, we had conversations with DOJ where DOJ
indicated that they want to take the program back.
Senator Brown. But you had suspended it.
Mr. Woll. What we tried to do is we had an issue with
respect to our clearance process. There was an amendment that
was added and put up online. What we tried to do is reinstate
the old NOFA that had been properly cleared. We did not intend
to take it down or postpone----
Senator Brown. That is not exactly music to the ears of
people who wanted to know what happened and got no explanation
from HUD or DOJ, but principally from you, about why these
grants were suspended.
Mr. Woll. Well, I can tell you that I know that your
letter--I know that DOJ has a draft, which I have seen fairly
recently and I anticipate that, with respect to your letter,
they are going to be responding very soon, and they are
optimistic that they are going to be able to launch this
program. We have told them all along that we are here to help
them. We think it is a wonderful program. We completely support
it and will continue to support it in every way. It is
essential for helping human trafficking victims.
Senator Brown. Well, I appreciate that. Very soon is
already very late considering when the letter was sent.
Let me ask you another question in the last minute. You are
the lead HUD official in a proposed rule to revise the 2016
equal access rule. HUD found in those days, in the previous
Administration, that transgendered persons experience
``significant violence, harassment, and discrimination in
attempting to access services.'' Transgender persons are often
discriminatorily excluded from shelters or face dangerous
conditions in the shelters that correspond to their sex
assigned at birth.
A dozen of us concerned about those revisions requested a
briefing from you on possible policy changes in June, but the
Department declined. You would not provide a briefing that we
asked for 5 months ago.
I will ask you now: Do you believe it is appropriate for
transgender people to be denied access, particularly in light
of your statement, your opening statement, to be denied access
to basic HUD-funded shelter that corresponds to their gender
identity?
Mr. Woll. With respect to the 2016 rule, I am a little bit
limited in what I can say because it is currently pending
before OIRA, but----
Senator Brown. That is not a reason not to give a briefing,
but go ahead.
Mr. Woll. I can tell you, Senator, that I detest any form
of discrimination against anybody, particularly based on sexual
orientation or gender identity. The 2012 rule continues to
disallow that discrimination, and we are not going to permit
discrimination against transgender individuals.
Senator Brown. I believe you. I do not know you. I believe
you. I heard your testimony. You sound, from my staff, as an
honorable, decent man. Your faith is important, and your faith
taught you to treat people--regardless of all of those things,
to treat people alike. But you are part of an Administration
that says terrible things about all kinds of people and divides
people along race and gender and immigrant status lines, and I
hope you do your job irrespective of what people that might be
your bosses want you to do in terms of race and gender.
Mr. Woll. Senator, I know the Secretary is on record saying
that he detests discrimination, and, you know, we intend to
completely enforce the 2012 restriction against any
discrimination against anybody based on sexual orientation or
gender identity.
Senator Brown. Well, the Secretary has not--I appreciate
that comment in front of us, but the Secretary has not really
acted that way. But I trust you will. Thank you.
Chairman Crapo. Senator Menendez.
Senator Menendez. Thank you, Mr. Chairman.
Mr. Montgomery, back in 2017 I voted for your nomination to
your current position in part because you assured me that you
``strongly supported the Section 811 program,'' which supports
persons with disabilities. You also stated your support for
Section 202 housing, which provides housing to seniors.
Unfortunately, the Administration has repeatedly called for
cutting these programs for seniors and persons with
disabilities, most recently by $34 million and $27 million,
respectively.
So according to HUD, about one in seven renters with
``worst-case housing needs'' included a nonelderly person with
disabilities. In 2017, you assured me with respect to the 811
program that you will ``continue to advocate for this important
program.''
I will assume you have been advocating, although the
Administration seems to be going in a different way. If you are
confirmed to this new position, that will give you an elevated
status in terms of your ability to speak to the Secretary. Can
you assure me that you will ``continue to advocate for this
important program''? And if so, will you advocate to make sure
that it has the appropriate resources in order for it to be
fulfilled?
Mr. Montgomery. Thank you, Senator, for your question. If I
am honored by this Committee to be Deputy Secretary, I will
more than likely continue to run the FHA until a replacement
can be named. So potentially in both capacities, I will
definitely obviously continue to advocate for the 202 and 811
program, as I did back in the Bush and Obama administrations. I
think there is no better program to help largely elderly
widowed females, frail elderly, than the 202 program. I was
glad when this body 3 years ago put in additional funds for
what is called ``capital advance,'' which was to construct more
202 programs, and the same for the 811 program. My commitment
to both has not changed, Senator, and I will continue to
advocate vigorously for both.
Senator Menendez. All right. Secretary Carson proposed
raising the rents in federally assisted housing by an average
of nearly 50 percent and triple rents for the lowest-income
households. That proposal would put approximately 1.7 million
people, including nearly a million children, at risk of
eviction, hardship, and homelessness. In the State of New
Jersey alone, 150,000-plus households would be affected. That
is simply not acceptable. You and I talked about this, and
there is, you know, some concern about budgets and whatnot--I
get that--or some concern about those who have more income than
that which is being reported. Of course, if you have more
income, all of this housing is income-related to a large
degree, so you should be reporting your income. But the result
of going after individuals who have not reported their income
is not to raise the rents across the board to everybody, who
may very well still be stuck in the income status that
justified their ability to participate in that program.
Mr. Montgomery. Well, I will say, sir, that no mass
evictions will occur as long as I am FHA Commissioner,
Assistant Secretary for Housing.
Senator Menendez. But do you understand the consequences,
if implemented, of having a 50-percent increase on average and
triple rents for the lowest-income households?
Mr. Montgomery. As you know, I am the only person to serve
as FHA Commissioner twice, and I am concerned, as I am sure you
are, that when I was Commissioner last time, we were helping
about the same number of people that we did back then, yet the
costs have gone up $2 to $3 billion. So I think it is how do we
contain the cost or, again, looking at possibly increasing
renter contributions. We have to work together to address how
this is going to be fixed going forward because, otherwise, the
numbers will just continue to go up.
Senator Menendez. Well, we do not have to spend $1 trillion
in unpaid tax cuts. That would help us fund some of these
programs. So I always see that we revert to going to the most
vulnerable in our society as those who we are going to put this
on their back, and I am going to fight that tooth and nail if
that is where the Department is headed, and I want you to know
it. And I hope that based on your experience you will move in a
different direction.
Mr. Chairman, it is difficult, and I urge you and the
Ranking Member, when you have a panel this size of critical
nominees, to get to the issues in 5 minutes. So I really hope
either that you will consider a second round or that we can
limit the size of these panels because it is impossible to get
into critical questions with different critical, important
positions. So if you will just give me the courtesy of another
minute or so.
Mr. Woll, Superstorm Sandy was one of the most destructive,
costly natural disasters for the Northeast, particularly in the
State of New Jersey. I will give you an example: Patricia from
Union Beach, she was forced to vacate her house twice. She
selflessly turned down the opportunity to tap additional
disaster funding because she was so exhausted with the process,
and she felt she had enough to rebuild, only to get hit with a
$32,000 so-called clawback bill nearly 4 years after Sandy. Her
life right now is a manmade nightmare, not natural disaster.
There are thousands of people in the same situation as
Patricia, and they want to know that their nightmare will end
soon. Governor Murphy has taken a critical step of freezing
these types of clawbacks until we work something out.
Can you commit to working with my office in New Jersey to
find a comprehensive solution that finally closes the chapter
and allows Sandy survivors to move forward with their lives?
Mr. Woll. Absolutely, Senator.
Senator Menendez. And one last Sandy-related question. We
fought incredibly hard to pass into law resources for the
Rebuild by Design program, which funds resiliency projects in
New Jersey and other affected States as a proactive, cost-
effective way of looking to the future to mitigate damages so
we are not spending more money.
Unfortunately, there is an arbitrary deadline that could
force New Jersey and other States to forfeit all funding not
spent by 2022. These are incredibly complex flood resilience
projects, like the one in Hoboken, Weehawken, and Jersey City
of $230 million that would provide flood protection to tens of
thousands of residents in one of the most flood-prone,
economically significant, and densely populated areas. With the
2022 deadline now looming as these projects get ready to break
ground, would HUD be willing to work with New Jersey on an
administrative waiver to allow the State to expend Sandy funds
beyond the 2020 deadline to complete some of the most vital and
innovative flood-resilience projects? Otherwise, the money that
we spent up front will have been lost for nothing.
Mr. Woll. Yes, and I am very familiar with the Rebuild by
Design program, competition, actually, based on my time in New
Jersey. We think it is a wonderful program. We do want to have
high-value, transformative projects, so, absolutely, we will
work with you with respect to any sort of waiver that we can
consider.
Senator Menendez. Thank you very much.
Chairman Crapo. Senator Cortez Masto.
Senator Cortez Masto. Thank you. Welcome to all of you.
Congratulations on your nominations. Welcome to your families.
For the same reasons that my colleague from New Jersey just
talked about, I am not going to get to ask all of you
questions, so let me just start with Mr. Montgomery and Mr.
Woll.
Do you believe we have an affordable housing crisis in this
country?
Mr. Montgomery. Thank you for your question. I would say
certainly more so in some areas versus others, and there are a
whole lot of reasons for that.
Senator Cortez Masto. OK. Mr. Woll.
Mr. Woll. I concur with the Commissioner. In certain areas,
we certainly have an affordable housing crisis.
Senator Cortez Masto. Yeah, and I heard the Ranking Member
mention this, but there are 11 million extremely low-income
families who spent more than 30 percent of their income on rent
and utilities in this country. But here is my concern. I know
the 2020 budget proposal from the Trump administration asked
Congress to drastically cut housing benefits that help millions
of low-income seniors, people with disabilities, families with
children, veterans, and other vulnerable populations. In fact,
the proposed cut, to my understanding, to the HUD budget is
about $9.6 billion, or 18 percent below the 2019 enacted
levels.
If true, and you are confirmed, what will you do to ensure
that HUD provides safe and affordable housing to veterans,
people with disabilities, low-income elderly, and families with
children? Mr. Montgomery, I am going to start with you.
Mr. Montgomery. Well, thank you for your question. I will
speak to the programs that I run. I mentioned to Senator
Menendez my commitment to helping those less fortunate, whether
it is vulnerable elderly, persons with disabilities, families
needing extra help, extremely low income. That commitment has
not changed and will not change. I will continue to advocate
for that. As you know, the budget is an iterative process, a
process that goes back and forth and is lengthy, and the costs
continue to grow and grow and grow. Again, I think that is
something that, working together, we need to address.
Again, looking at my tenure when I was Commissioner last
time and now, we are helping about the same number of people.
The costs continue to spiral.
Senator Cortez Masto. So I appreciate your commitment, and
I appreciate the costs, but give me specifics. You have been
there long enough. Tell me how you plan on helping. What
specific programs are you implementing? What are you doing?
Mr. Montgomery. Well, I would put at the top of the list
the Rental Assistance Demonstration Program that began during
the previous Administration. To me it has been an excellent
example of bipartisanship. It has allowed us to take aged
public housing and convert it to more project-based rental
assistance housing. So far we have done that to roughly 150,000
properties throughout the country. As you know, we are looking
to raise the ceiling on that. And it is helping to fill what is
an enormous infrastructure hole that resulted over the last 30
to 40 years.
It is important, obviously, to develop, but it is equally
important to preserve and hold on and renovate the aged housing
stock.
Senator Cortez Masto. Anything else?
Mr. Montgomery. Well, again, I continue to advocate for the
202 and 811 and PBRA programs.
Senator Cortez Masto. Let me ask you this: Will you ensure
the continuation of the Housing Trust Fund?
Mr. Montgomery. Well, as you saw in the report, we
reference the Housing Trust Fund. There have been a lot of
different proposals of what that could look like, and that is
one of the areas that we signal we want to work with Congress
to fashion a Housing Trust Fund, and that is the direction we--
--
Senator Cortez Masto. Do you plan on making changes to the
Housing Trust Fund?
Mr. Montgomery. I think there should be a discussion about
how best to administer it, whether it should be formulaic,
should it be where the worst-case housing need is, and, again,
I think that is a process we could work together on to
determine the best path forward.
Senator Cortez Masto. Mr. Woll, what about you? Give me
specific ideas on how we address the affordable housing crisis
and what you intend to do or what you have done in the past to
address it.
Mr. Woll. Well, you had mentioned the Affordable Housing
Trust Fund, and I think many of the goals of the Affordable
Housing Trust Fund are excellent ones. We know that there is
bipartisan support on funding affordable housing. My role at
CPD would be to administer funds that come to us. There is a
statute in place, as you know, Senator, HERA, dating back to
2008, that establishes the mechanism for funding through the
GSEs. And I know that the FHFA Commissioner has indicated that,
as long as that continues to be funded through the GSEs, he
will continue to collect the funds from the GSEs. And I commit
to you that we will continue to use those funds in a wise and
efficient way as long as we are still administering that
particular program.
With respect to, you know, other more vulnerable folks, our
focus is on the most vulnerable, particularly the unsheltered
homeless at this point, elderly and disabled. A lot of that we
address through our Continuum of Care Program, whose funding
has actually gone up to $2.3 billion. That is an important
program for us, and we continue to administer that, hopefully
in an efficient way.
Senator Cortez Masto. Thank you. I notice my time is up,
and I will submit the rest of my questions for the record. But
I think we all agree there is an affordable housing crisis, and
we need answers and we need solutions and we need ideas about
how we address it, not cutting funding, not changing programs,
but focused on addressing the very issues that we just talked
about. My biggest concern is I have not seen that coming out of
HUD, and I would like to work with you to make sure this is an
issue we are addressing across the country.
One other area we have not even talked about was the role
that manufactured housing can play in addressing affordable
housing in this country.
So thank you again for the opportunity, Mr. Chair. I
appreciate it.
Chairman Crapo. Thank you.
Senator Schatz.
Senator Schatz. Thank you, Mr. Chairman. Thank you all for
your willingness to serve. Thanks to the families for sitting
there politely. We are almost done.
I want to ask about the slow pace of disaster funding
getting pushed out. On October 5, 2018, Congress appropriated
the first round of CDBG-DR funding for the 2018 disasters. That
is 412 days ago, and I think none of it has been pushed out. I
wanted to start with Mr. Montgomery. What is happening there?
And how do we do better?
Mr. Montgomery. Well, sir, I will zero in on the mitigation
program first. As you recall, this is the first time Congress
they have developed this program to help get ahead of--help
communities get ahead in preparation for what I am sure will be
future storms. It was a very new program for us.
Senator Schatz. Right, so measure twice, cut once. You are
trying to get this right. You are establishing a new program.
It is a nontrivial amount of money. You want to----
Mr. Montgomery. $16 billion.
Senator Schatz. Right. You want to do it right. I get it.
So we have a bill, Senator Young and I, to codify CDBG-DR so
that you do not have to go through the Administrative
Procedures Act every single time you are doing essentially the
same thing. That will not cut down all of the time because
there are multiple sort of reasons for and layers of delay. But
would that help if that were codified in statute?
Mr. Montgomery. I will take that one, Senator. I would say
that there have been other instances where the Administrative
Procedures Act has hindered my ability to run a $1.4 trillion
corporation, the FHA. I understand why the APA is there and the
process it brings, but there are some things that happen,
housing crises, natural disasters. We cannot always adapt to
the slowness of the Administrative Procedures Act.
Senator Schatz. So it would help?
Mr. Montgomery. I am not saying we get rid of it. I am just
saying in the abstract----
Senator Schatz. I understand.
Mr. Montgomery. Anything to speed up----
Senator Schatz. But, again, this is not a waiver of the
Administrative Procedures Act. This is just establishing the
program in statute so that you do not have to hang your hat on
existing Federal law and then go and make a rule to allow
yourself to do it. We would just presumptively allow it as a
matter of Federal law.
Mr. Woll, you seem to want to weigh in here.
Mr. Woll. Yeah, I think authorizing CDBG may make sense,
and I think, you know, the Secretary is on record basically
saying that it may give us an opportunity to start on second
base in order to speed the money to the grantees. I think it
would be essential with respect to any bill that it would
retain the waiver and alternative requirement authority that
the Secretary currently has because that is the thing that
allows us to be nimble and to react to the different types of
disasters such as in your State.
Senator Schatz. Sure.
Mr. Woll. And, you know, the different needs----
Senator Schatz. We like the waiver authority very much
where volcanoes exist.
Mr. Woll. Absolutely.
Senator Schatz. Thank you.
Can you speak to the value sort of more generally, Mr.
Montgomery, of resilience and mitigation funding? This is sort
of a new area, and I would like you to just very briefly talk
about why you think it is important.
Mr. Montgomery. Well, I actually think it is important for
some of the reasons articulated before, to help States and
communities get better ahead in preparation for the next storm,
whether it is, you know, infrastructure projects, seawalls,
drainage, you name it. And I think Congress did the right thing
by authorizing it and funding it.
Senator Schatz. Thank you. Finally, I would like you to
weigh in on a report entitled ``The State of Homelessness in
America'' from the Council of Economic Advisers. Frankly, they
say some weird things in this report, and I want to quote from
it: ``While shelter plays an extremely important role in
bringing some of the people off the streets, it also brings in
people who would otherwise be housed, thus increasing
homelessness.'' Further, it says, ``Free shelters that are
hygienic, safe, and dignified enough to accomplish some of the
goals they should accomplish are also attractive enough to
bring in many people who would not otherwise be on the
street.''
They are saying that if you make shelters too nice, people
will choose to be homeless or house-less, and I am wondering,
given your expertise and your position, if you would like to
weigh in on that.
Mr. Montgomery. I would just say that most of the shelters
I have toured have not been luxurious by any stretch of the
imagination.
Senator Schatz. Mr. Woll.
Mr. Woll. Well, obviously, shelters is just one step. There
is nothing worse than being out on the street. Those are the
people who are the most vulnerable. Shelter is one step up----
Senator Schatz. Sure, but I want to put--sorry to
interrupt. Just in the interest of time, I want to put a fine
point on what the Council of Economic Advisers is actually
saying. They are not talking about that. They are saying if you
make these facilities too nice, people are going to choose to
move from being housed to moving into a shelter because that
sort of--I mean, I just do not know any--first of all, to your
point, Mr. Montgomery, there are no shelters that are that
fancy. But even if there were, there is just no person that I
am aware of who would sort of elect to go and move into a
homeless shelter if the alternative were to be more properly
housed. And I am assuming that both of you are in agreement
with me and in disagreement with the CEA.
Mr. Montgomery. Well, I would just say your point is well
taken, and I will go back and look at the study again and
circle back with you.
Senator Schatz. Mr. Woll.
Mr. Woll. I have not read that particular report. I know
usually we are working the other way to get people into
transitional housing and then hopefully rapid rehousing,
permanent housing, as a way of properly--it is hard to treat
somebody who has been out on the street unless you give them
shelter.
Senator Schatz. Thank you.
Chairman Crapo. Thank you.
Senator Brown has one more question, and then we will wrap
it.
Senator Brown. I want to go back to Mr. Montgomery for one
question. I do not feel like I quite got the answer. I know HUD
did not start considering the disparate impact rule during your
tenure, and you pointed that out. But you were Acting Deputy
Secretary when HUD issued its proposed disparate impact rule,
which--so let me say it again. Did you sign off on the proposed
disparate impact rule? It was published in August. You talked
about when it was begun you were not there. But when it was
published, it was in August, 8 months after you took over. Did
you sign off on it?
Mr. Montgomery. Well, in terms of--you mean like physically
signing some document? Just to make sure I understand your
question.
Senator Brown. Yeah, did you--does that mean you
supported--did you do an official act to support this rule?
Mr. Montgomery. In terms of literally signing off on
something, no, I have not. That is not under my purview. As you
know, I currently run the FHA.
Senator Brown. Put that aside. You are Deputy Secretary----
Mr. Montgomery. It does consume a lot of time----
Senator Brown. Acting Deputy Secretary. I am thinking
responsibility for something as big coming out of HUD as the
disparate impact rule. Did you support that? Did you actually
do something affirmative to allow this to move forward?
Mr. Montgomery. Sure, absolutely. I have been involved in
those discussions, and there is a sufficient amount of gray
area within the Supreme Court decision that they caution we
need to put some meaningful safeguards, you know, to help
ensure ``the free market system.'' So I think part of what we
are doing to make sure that, yes, they upheld the theory of
disparate impact, but we need to be careful and put some
safeguards in place.
Senator Brown. OK. But the question was not defend the
rule. I think that is pretty indefensible. You do not. But I
just wanted to know your responsibility in the rule being
promulgated and approved, and as Deputy Secretary, you were
responsible, correct?
Mr. Montgomery. Well, there are a lot of us at HUD
responsible for it, but going forward, I would be more involved
in that process going forward.
Senator Brown. All right.
Chairman Crapo. Thank you. That concludes the questioning
for today's hearing. For Senators who wish to submit questions
for the record, those questions are due to the Committee by the
end of the day on Friday, November 22nd. And to our witnesses,
we ask that as you receive those questions, you respond to them
no later than close of business on Monday, December 2nd.
Thank you again to our nominees for being here today, and,
again, thank you for your willingness to serve.
With that, this hearing is adjourned.
[Whereupon, at 11:37 a.m., the hearing was adjourned.]
[Prepared statements, biographical sketches of nominees,
responses to written questions, and additional material
supplied for the record follow:]
PREPARED STATEMENT OF CHAIRMAN MIKE CRAPO
This morning, the Committee will receive testimony from five
nominees who have been selected to serve in key roles within the
Department of the Treasury, the Department of Housing and Urban
Development, and the Export-Import Bank.
Going down the line, we have: Mitchell Silk, to be Assistant
Secretary for International Markets at the Department of the Treasury;
The Honorable Brian Montgomery, to be Deputy Secretary of Housing and
Urban Development; David Woll, to be HUD Assistant Secretary for
Community Planning and Development; Jack Bobbitt, to be HUD Assistant
Secretary for Administration; and Peter Coniglio, to be Inspector
General of the Ex-Im Bank.
Welcome to all of you, and thank you for your continued commitment
to public service.
I see friends and family behind you, and I welcome them here today
as well.
Mitchell Silk has served with distinction as Acting Assistant
Secretary of the Treasury for International Markets since July and as
Deputy Assistant Secretary for International Affairs since 2017.
He is a leading expert in Chinese law and finance, who is fluent in
both Mandarin and Cantonese, and spent 15 years working in Greater
China as a Partner with the law firm Allen & Overy.
Since joining Treasury, Mr. Silk has been a key voice on trade
negotiations, energy and infrastructure finance, export credit and
financial services.
Brian Montgomery is no stranger to this Committee, having served as
Federal Housing Commissioner under Presidents Bush, Obama, and Trump,
and having testified before us on seven other occasions on matters
relating to housing and housing finance.
During his previous tenure at the helm of the Federal Housing
Administration, he provided steadfast leadership through one of the
most trying times that housing markets have ever seen.
During his current tenure at FHA, he has overseen the return of
FHA's insurance fund to its strongest financial position since Fiscal
Year 2007, while continuing to provide affordable home ownership
opportunities to tens of thousands of first-time home buyers each year.
Since January of this year, Mr. Montgomery has also served as
Acting Deputy Secretary, charged with overall management of day-to-day
operations of the Department.
Once confirmed as permanent Deputy Secretary, the Department will
continue to benefit from his deep institutional knowledge, expertise,
and dedication to making our housing programs work better.
Since November 2018, David Woll has served as Principal Deputy
Assistant Secretary for HUD's Office of Community Planning and
Development, where he has overseen HUD's homeless assistance, disaster
relief, and block grant programs.
He has dedicated his entire career to public service, including as
an Assistant U.S. Attorney, Deputy General Counsel at HUD, and Senior
Policy Advisor to the Governor of New Jersey, where he served as the
State's compliance director for Superstorm Sandy relief efforts.
With direct experience both administering CPD programs and
implementing them as a State partner, Mr. Woll is well-equipped to
continue leading CPD forward.
Jack Bobbitt currently serves as Deputy Assistant Secretary for
Housing Operations at HUD, where he oversees procurement, human
resources, facilities, communications, and IT systems for the Office of
Housing.
He previously served as Special Assistant to Commissioner
Montgomery during the Bush administration and has also served in a
variety of executive roles in the private sector, including both large
corporations and start-up ventures.
If confirmed, Mr. Bobbitt would combine his keen understanding of
HUD operations with decades of private-sector experience as he oversees
HUD facilities, procurement, staffing, training, and performance
management.
Finally, Peter Coniglio would bring a wealth of relevant experience
to the Export-Import (Ex-Im) Bank IG office, having served in the
Office of Inspector General at the General Services Administration
since 2006, in addition to other distinguished service within the
Department of Justice, the Department of the Treasury, and the Senate
Judiciary Committee.
In meetings with my office, Mr. Coniglio has committed to running a
``fully functioning, independent, regular order'' operation at the Ex-
Im Office of Inspector General.
In only a few months in office since their Senate confirmation, the
new Ex-Im President Kimberly Reed and her colleagues on the board have
already taken significant steps to bring greater transparency and
accountability to the bank.
This progress has not gone unnoticed by many of us on the
Committee.
Having a new Senate-confirmed Inspector General in place will only
serve to strengthen those efforts.
These nominees are highly distinguished and well-qualified to serve
in the roles to which they have been nominated.
I look forward to working with each of you in the months ahead to
advance the aims of your agencies and to expand economic growth.
Thank you once again for your willingness to serve and for
appearing before our Committee today.
I encourage my colleagues to expeditiously confirm all five of you
so that you can quickly get to work for the American people.
______
PREPARED STATEMENT OF SENATOR SHERROD BROWN
Thank you, Mr. Chairman, for holding today's hearing on the
nominations of Mr. Mitchell Silk, Mr. Brian Montgomery, Mr. David Woll,
Mr. John Bobbitt, and Mr. Peter Coniglio. Congratulations to each of
you and welcome to your families and guests.
President Trump nominated Mitchell Silk to be Assistant Secretary
for International Markets at the Treasury Department.
His portfolio at Treasury is broad--from energy and infrastructure
issues, to trade negotiations with China and global financial risks at
the Financial Stability Board.
China has recognized the global demand for updated infrastructure
investments and is making significant investments in infrastructure
projects around the world through its Belt and Road Initiative.
However, concerns have arisen--about the terms provided; the failure to
use local workers; and the quality of the work completed.
The appetite for the Belt and Road Initiative makes clear that we
need to increase support for investments abroad in order to provide the
world with a market-based alternative to China, one that respects
workers and is focused on sustained, local growth and not on the
expansion of Chinese influence. U.S. leadership in infrastructure
development also requires acting to address the threats we face from
climate change. If confirmed, Mr. Silk, I hope that you will continue
to focus on those efforts.
We will also hear from Mr. Coniglio, the nominee to be Inspector
General at the Ex-Im Bank. A confirmed Inspector General will help
ensure transparency and accountability in the Bank's operations, but
Mr. Coniglio's nomination is not the only Ex-Im nomination that we need
to act on.
The full Senate needs to vote on the nominations of Paul
Shmotolokha [Schmo-tow-low-ka] and Claudia Slacik whom our Committee
previously reported with strong bipartisan support. We need a full Ex-
Im board and a qualified inspector general to provide oversight and
guidance as Ex-Im approves deals that create jobs in Ohio and around
the country.
Finally, three of today's nominees have been nominated to positions
within the Department of Housing and Urban Development, where they are
all currently serving.
Mr. Montgomery is currently serving in a confirmed role as
Assistant Secretary for Housing--Federal Housing Commissioner and has
been nominated to serve as Deputy Secretary.
Mr. Woll has been nominated to be Assistant Secretary for Community
Planning and Development and has experience monitoring compliance with
the CDBG-Disaster Relief program, which he would oversee if confirmed.
And Mr. Bobbitt has been nominated to serve as Assistant Secretary
for Administration, where he would be responsible for overseeing hiring
policies, procurement and operations.
HUD provides housing assistance to 4.7 million low-income families
and supports homeless services across the country. It also enforces the
Fair Housing Act, insures more than 8.1 million mortgages, and
administers billions in assistance to communities hit by natural
disasters.
HUD's policies affect every community--both big and small. A home
is a foundation for opportunity, and it's usually the biggest item in a
family's budget. Hardworking families and the Nation's most vulnerable
members rely on these critical programs and protections.
But President Trump's administration doesn't seem to understand
that.
At a time when 11 million families spend more than half of their
income on housing, we need to be doing more to help families succeed.
Yet the Trump administration has year after year proposed to slash
HUD's budget and eliminate programs like CDBG and HOME that make
affordable housing development possible.
This Administration has also released a document questioning long-
established best practices to address homelessness, and just last week
removed the widely respected head of the interagency council
responsible for coordinating Federal agencies' homelessness response.
HUD wants to undermine the enforcement of the Fair Housing Act
based on disparate impact, and to weaken protections for transgender
individuals' who need shelter.
Last week, HUD promoted a political appointee with a history of
racist and sexist writings to the second highest position at Ginnie
Mae, which guarantees $2.1 trillion in mortgage-backed securities.
And just a few months ago, HUD proposed changes to the FHA program
that could make it harder for millions of families to afford to buy a
home.
Each of these actions is deeply troubling on its own. Taken
together, it's pretty clear that not only is President Trump's
administration not doing anything to help families afford a home, but
that they're actively making it harder.
Both Mr. Woll and Mr. Montgomery have played a role in some of
these policies and decisions, and I expect to hear more about that in
today's hearing.
These positions play a critical role in many of the economic issues
our country faces--from international trade, to sustainable energy, to
affordable housing, and I look forward to hearing more from the
nominees. Thank you.
______
PREPARED STATEMENT OF MITCHELL A. SILK
To Be Assistant Secretary for International Markets, Department of the
Treasury
November 20, 2019
Chairman Crapo, Ranking Member Brown, and distinguished Members of
the Committee, it is a great honor to appear before you today as the
President's nominee to be Assistant Secretary of the Treasury for
International Markets. I thank the President and Secretary Mnuchin for
their trust and confidence in me. If confirmed, I look forward to
working with all of you on the critical issues within Treasury's
International Markets portfolio.
As backdrop to my remarks, I wish to acknowledge my family,
including my extraordinary grandparents and parents who are no longer
with us. At times like this, the feeling of loss is tremendous, and
tempered only by their immense inspiration that I will detail in a
moment. My amazing wife Yocheved Rivka is here with me today. She
serves our community as a physician's assistant in a family practice in
Brooklyn while looking after our eight children and doting on our three
grandchildren. She is a constant source of inspiration, support and
strength. She is joined by her father, Rabbi Duvid Aron Orlander, and
four of our children: Meshulam, Naftuli Chaim, Mordechai Dov, and Tauba
Raitza.
I owe the privilege of appearing before this distinguished
Committee to my family and the opportunities that the United States of
America has afforded us. My grandparents immigrated to this country
from hardship and persecution in Eastern Europe. Their life experiences
were chilling. My maternal grandfather, the guiding light of my life,
grew up in abject poverty, witnessed Cossacks brutally murder his
family members and struggled to cope with the extermination of his
family in the Holocaust. For my family, this country represented
freedom, security and immense opportunity. They worked hard as
tradesmen and laborers.
Their life challenges enforced their commitment to improving the
lives of others. My grandfather spoke with pride of his communal
leadership, including his part in successfully lobbying for one of
Chicago's first projects to provide subsidized housing for over 1,000
impoverished European immigrant families during the Great Depression.
My father was proud to have served in the Second World War in the
Pacific Fleet. His brother served in the Army National Guard. My mother
assisted the lives of thousands over her 40-year nursing career.
Family circumstances required me to go to work full time when I was
thirteen. My first job was in a Chinese restaurant as a dishwasher,
then prep cook, busboy, and finally waiter. My hard work yielded
fluency in Chinese and sufficient earnings to fund college and law
school. I was the first in my family to graduate from college.
I enjoyed an exciting career in law for more than 30 years in both
the U.S. and Asia. I specialized in large and complex cross-border
investment, bank regulatory and finance matters, focusing heavily on
the energy and infrastructure sectors. Like my grandparents and
parents, service to the community was a priority for me. While in
private practice, I served for over a decade as chair of a nationwide
pro bono legal services network of more than four hundred lawyers.
I joined the Treasury Department as Deputy Assistant Secretary for
Investment, Energy and Infrastructure in 2017. Over the last 2 years, I
have had the honor of advancing our country's interests alongside
Treasury leadership and its highly dedicated career staff.
Treasury's International Markets portfolio is critical to advancing
U.S. interests in global financial and investment markets. We lead
engagement with international regulatory bodies and coordinate trade
policy with respect to financial services. We also oversee Treasury's
technical assistance program, which assists our allies globally. In
addition, the portfolio covers the critically important areas of U.S.
participation in development finance, including implementation of the
BUILD Act, and trade finance globally. And we lead Treasury's efforts
to promote private capital solutions in energy and infrastructure
finance to support responsible global growth, a critical initiative
which I designed and have overseen since joining the Department.
My work at Treasury and in private practice has given me a deep
appreciation for how these international economic issues have a
significant impact on the lives of individual Americans. It has been
and will continue to be an honor to come full circle and play my part
to ensure the continued freedom, security and immense opportunity that
this country afforded my family. If confirmed, I will work closely with
this Committee to continue these essential tasks.
Thank you again for the opportunity to appear before you today. I
look forward to answering your questions.
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PREPARED STATEMENT OF BRIAN D. MONTGOMERY
To Be Deputy Secretary, Department of Housing and Urban Development
November 20, 2019
Thank you Chairman Crapo, Ranking Member Brown, and Members of the
Committee, I am honored to appear before you today to be considered for
the position of Deputy Secretary of the Department of Housing and Urban
Development (HUD).
If I could, I'd like to take a moment to thank my family, including
my wife, Katy, my two children, Emily, age 13, and Thomas, age 10, as
well as my parents and sisters for their love and support over the many
years. Sadly, my dad passed away 2 years ago, but my mom, the daughter
of Mexican immigrants, is in Houston and I am grateful for all the
sacrifices they made that allowed me to be here today.
I would also like to express my gratitude to President Trump and
Secretary Carson for the confidence they have in me to serve in such an
important role at the Department.
Working with Secretary Carson for the past one-and-a-half years has
provided me with a new understanding of what it truly means to serve.
It has been an honor and I look forward to advancing HUD's mission
together as his Deputy.
Mr. Chairman, I was humbled by the trust this Committee placed in
me to serve as FHA Commissioner from 2005 to 2009 and again in this
Administration. I have always believed that the work we do at HUD
transcends party lines. It's making sure every hardworking American has
a fair shot at the American Dream.
During my tenure at HUD, which has spanned 6 years, three
Administrations, and both parties, I'm proud of the work we did to
preserve FHA as a viable option for home buyers.
Just last week I was pleased to present HUD's Annual Report to
Congress regarding the status of FHA's Mutual Mortgage Insurance (MMI)
Fund for fiscal year (FY) 2019.
This year's Annual Report reflects the significant progress FHA has
made since this Administration took office to improve the fiscal health
of the MMI Fund, protect taxpayers, and continue serving American home
buyers.
The MMI Fund is as sound as it has been in over a decade with a
capital ratio of 4.84 percent. In FY2019 FHA insured forward mortgages
for 990,000 households, of which 615,000, were first-time home buyers.
In addition, over one third of FHA's purchases mortgages went to serve
minority home buyers.
One way we have sought to strengthen FHA has to been to clarify
regulatory expectations so that responsible lenders can confidently and
fully participate in the program.
For example, market participants' concerns about uncertain and
unanticipated False Claims Act liability for underwriting defects has
led many depository lenders to largely withdraw from FHA lending.
Today, depository institutions originate less than 14 percent FHA-
insured mortgages, down significantly from approximately 44 percent in
2010. To address these concerns, in October, HUD and the Justice
Department signed a Memorandum of Understanding (MOU) for cases brought
under the False Claims Act against FHA lenders. This MOU provides a
framework to apply remedies for FHA lender violations in a consistent,
uniform and appropriate way. In addition, FHA updated its
certifications and defect taxonomy to better assess the appropriate
remedies for program violations. This suite of reforms should make
affordable FHA-insured mortgages more accessible to qualified borrowers
and reduce risks within the FHA program.
We are also working to expand and strengthen loss mitigation
options for borrowers. Under my tenure, FHA made permanent the
``Disaster Standalone Partial Claim'' for disaster victims who are
rebuilding or buying another home following a disaster. This option
covers up to 12 months of missed mortgage payments via an interest-free
second loan on recovering families' home.
In recent years, HUD has been asked to play a greater role in long-
term recovery after natural disasters. If I'm confirmed as Deputy
Secretary, I want to give you my pledge that we will do everything we
can to help the people impacted by the hurricanes that ravaged so many
States, from my hometown of Houston to North Carolina and Puerto Rico,
as well as the most recent wildfires in California.
In 2017, for the first time in the history of HUD's administration
of disaster recovery, Congress provided mitigation funds as part of a
CDBG-DR appropriation. To deliver on this mission, I have visited
Puerto Rico to meet with the island's political leadership and with the
officials at Vivienda who are responsible for administering the CDBG-DR
grant. We are committed to ensuring the record funding going to Puerto
Rico reaches the people in need and helps them recover and build a more
resilient future.
I further note that HUD has one of the most tenured workforces in
the Federal Government, and its headcount has decreased by more than 60
percent over the past 20 years. It is a priority that we have the right
work force to fulfill HUD's important missions in the years to come,
and we are working hard to make that happen.
Finally, HUD's housing finance reform plan, released in September,
calls for additional improvements to FHA's policies, technology, and
operations. I would note that during my first tenure in this job, back
in 2008, we were able to work closely with the leaders of this
Committee, including Senators Shelby and Reed, to pass a landmark FHA
modernization bill. I sincerely hope we can continue that work in the
year ahead and pass meaningful, bipartisan housing finance reform.
I'd like to thank the Committee for your time this morning, and
your consideration of my nomination to serve as Deputy Secretary. I
look forward to your questions.
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PREPARED STATEMENT OF DAVID C. WOLL, JR.
To Be Assistant Secretary for Community Planning and Development,
Department of Housing and Urban Development
November 20, 2019
Thank you, Chairman Crapo, Ranking Member Brown, and distinguished
Members of this Committee. I am deeply honored to be nominated to serve
as Assistant Secretary of the U.S. Department of Housing and Urban
Development's Office of Community Planning and Development.
If I may, I would first like to introduce my family, who are the
most important people in my life. I am happy to introduce my wife of 23
years, Phoebe Cabell Woll. I would also like to introduce my three
children: my oldest son Tripp, who is a senior at Pennsylvania State
University; Ted, who is a junior at the University of Wisconsin; and my
youngest, Bryce, who is a sophomore in high school.
I would also like to introduce my dad, David Woll, who has been my
mentor both as a father and as a lawyer. My dad and my mom, who I wish
was still with us today, taught me the importance of faith, values and
treating every person, regardless of their background or circumstances,
with compassion, dignity, and respect.
My brother Mike is also here with his wife, Anita Woll. I cannot
thank them enough for their tremendous support. My sisters Eileen and
Francie were unable to travel here today, but they too have always been
very supportive of me and I am profoundly grateful for their love and
encouragement.
My path to nomination and this confirmation hearing has been
somewhat untraditional. After graduating from the University of
Maryland and the University of Virginia School of Law, I spent most of
my earlier career as an investigator and prosecutor working to protect
victims of crime.
At the Securities and Exchange Commission, I was a senior counsel
in the Enforcement Division, where one of my largest matters was a
securities fraud case involving a securities boiler room that targeted
unsophisticated and elderly investors.
At the U.S. Attorney's Office for the District of Columbia, I spent
3 years prosecuting domestic violence and sexual assault cases against
people who victimized some of the most vulnerable people in the
community, including children, indigent women who had been trafficked,
and young people who were LGBTQ. I also served as a Federal prosecutor
in Brooklyn, where I prosecuted business and securities fraud cases in
which the victims were financially devastated due to the greed of
others who took advantage of them. This included prosecuting a $100
million Ponzi scheme and a Hurricane Katrina fraud case.
Following Superstorm Sandy in the Fall of 2012, I had an
opportunity to do something completely different, which was to work on
disaster recovery for the State of New Jersey. That was an important
moment in my career because it ended up being my first exposure to HUD
and the dedicated career staff who work for its Office of Community
Planning and Development. It struck me then, as it does now, that CPD
genuinely cares about disaster victims, the unsheltered homeless and
others in need, and works incredibly hard to help grantees navigate
through very stressful and difficult circumstances. I feel particularly
privileged to be considered to lead this incredibly talented team.
There is always, however, room for improvement, particularly when
it comes to better serving the States and communities who are our
grantees. With this in mind, I have several priorities if I am
confirmed.
First, CPD needs to continue to strengthen its stewardship of the
Disaster Recovery program by making sure we have the right number of
people in the right places. To that end, we are in the process of
doubling the size of the disaster recovery division, and out-stationing
staff closer to our grantees. This will help us to deliver grant
assistance in a more efficient manner and give us greater flexibility
to respond to the unique needs of each State and grantee.
Second, CPD needs to work with other agencies, States,
municipalities and the private sector to develop strategies to target
unsheltered homelessness. This effort is similar to what we did when we
targeted veterans' and family homelessness, which led to decreases in
both numbers.
Third, our many field offices are on the front line and play a
critical role in forging relationships with our grantees. We need to
reshape our field operations in order to improve communications between
headquarters and the field, and to give the field offices greater
flexibility to react to the changing needs of our grantees.
Members of the Committee, I have always worked to help those who
are vulnerable and most in need. If confirmed, I commit to you that I
will continue to do so as the Assistant Secretary of CPD. Thank you.
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PREPARED STATEMENT OF JOHN BOBBITT
To Be Assistant Secretary for Administration, Department of Housing and
Urban Development
November 20, 2019
Chairman Crapo, Ranking Member Brown, and distinguished Members of
the Committee, it is a privilege to appear before you this morning. I
am deeply honored that President Trump has nominated me to serve under
Secretary Carson as the Assistant Secretary for Administration at the
Department of Housing and Urban Development.
Before I begin, I want to express my deepest appreciation to my
beautiful wife, Jian, who is here today. Jian has been, and continues
to be, a bedrock of support, the love of my life for me and our family
while I serve at HUD. She is here today from our hometown of Houston,
where she has maintained our residence to provide care for my mother
and father, George and Bette Bobbitt.
I want to thank my father, a Navy Veteran of World War II and my
mother who worked for the British Army Staff here in Washington, D.C.
They met at a USO dance during the war and have been married for 72
years. At 97 and 96 years old, they are the source of my passion to
succeed personally and professionally. I also want to acknowledge my
grandfather Dr. Clarence Charles Hastings, a prominent veterinarian and
World War I Veteran who instilled in me strong values and a work ethic
required to succeed. And finally, I want to thank my stepdaughter
Xaioting, Mike Fei, sister Robin, and our extended family, friends, and
colleagues for their love and support.
During my 37 years of business experience, I have served in diverse
executive roles in the private and public sectors responsible for
operations, finance, sales and marketing for large multibillion-dollar
corporations to start-up ventures.
My Government and public service journey began in 1984 as a
volunteer White House Lead Advance Representative. I served in that
capacity under the George H.W. Bush and George W. Bush administrations
and I have served in that role in the Trump administration. I also
served as the Director of Strategic Communications at HUD from 2006 to
2009 and had the privilege to return to HUD in February 2019 as the
Deputy Assistant Secretary for Operations, managing human resources,
procurement and facilities within the Office of Housing, HUD's largest
office. During my time in this position, I have established core
values, an open-door policy, met with many employees, restructured the
management team, and increased our FEVS score card of leadership by 23
percent and overall employee satisfaction by 17 percent. We also
created and launched a comprehensive Employee Development Training
Program.
My knowledge of HUD and Government operations has given me a sound
perspective on what is required to achieve success in the work ahead--
both from the organization and from myself. Additionally, my relevant
skills and extensive experience obtained from the private sector will
aid in implementing improved and more efficient processes.
I believe that a leader's management philosophy is the cornerstone
for the organization's direction, vision, goals and success. As a
leader, I am committed to the development and advancement of three
things: People, Processes, and Performance.
I believe you manage work, but you lead people. I believe in an
employee-centered organization that strives to achieve high morale
through a positive, accountable culture that develops individuals for
career growth and opportunities.
Next is the efficiency and effectiveness of the processes that are
adopted. A focus must be placed on clearly identifying and streamlining
processes and policies.
Finally, my emphasis is on performance. I believe that an
organization that properly sets standards of measurement, creates
attainable goals, and empowers staff to achieve them is bound for high
performance.
So, with these as my guiding philosophy, here are the priorities I
will focus on if confirmed as HUD's Assistant Secretary for
Administration:
1. I will implement a culture and set of core values as well as a
``career long'' employee training program that will foster
employee development and succession planning.
2. I will focus on improving the hiring process by working to
decrease the time it takes to hire, and reduce the risks
associated with critical vacancies.
3. I will introduce measures to decrease the prolonged process of
procurement and ensure qualified oversight of existing
contracts.
4. And finally, the modernization of HUD's hiring, training, and
procurement IT systems to enhance accuracy, accountability, and
the ability to effectively measure performance.
Mr. Chairman, distinguished Members of this Committee, thank you
again for your consideration of my nomination. I welcome your
questions.
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PREPARED STATEMENT OF PETER J. CONIGLIO
To Be Inspector General, Export-Import Bank of the United States
November 20, 2019
Thank you, Mr. Chairman, Ranking Member Brown, and Members of the
Committee for inviting me to appear before you today. It is my great
honor and privilege to be the President's nominee to be the Inspector
General of the Export-Import Bank of the United States. I am very
humbled to be considered for this position.
With me today is my wife of 42 years, Jamie Wright Coniglio. She is
my rock and my biggest fan, and there isn't any way that I would be
here today before you without her support and encouragement.
I'd also like to express my appreciation to my current and former
colleagues in GSA's Office of Inspector General for their terrific
support throughout this process. They are all consummate professionals.
I am here today because my grandparents came to this country from
Italy: my father's father from Sicily in 1897 and my mother's parents
from Calabria--the ``toe of the boot'' after the turn of the 20th
Century.
My late father served in the Army Air Force in the China-Burma-
India theater during World War II, while my late mother worked to
support the war effort stateside. They were among that great generation
of Americans who were tempered by the hardships of the Great Depression
and who then went on to win World War II and the Cold War.
I could not have had better parents. My being here today is also a
testament to them.
Since my graduation from Drake University Law School, I have been
afforded many opportunities and experiences that have prepared me for
this opportunity.
I served with a legislative staff in the Iowa State Senate in Des
Moines, and after we moved to the D.C.-area I served with the
legislative affairs shop of a major trade association.
I was then fortunate to serve as a legislative assistant for Rep.
Jim Ross Lightfoot of Iowa--as a line-counsel for Sen. Charles
Grassley's then-Senate Judiciary Subcommittee staff--and then as the
late Rep. Lawrence Coughlin's Minority Chief Counsel and Staff Director
of the then-House Select Committee on Narcotics Abuse and Control.
I then moved from Capitol Hill to the Justice Department, where I
served for about 13 years. My major activities there included working
in its Office of Legislative Affairs and in the General Counsel's
Office of its Executive Office for United States Attorneys.
After the Justice Department, I was hired as the Senior Counsel for
Ethics in the Office of General Counsel at the Treasury Department.
Since June 2006, I have been in the Office of Inspector General at
the General Services Administration, working for three Inspectors
General. Each of them tutored me on how to be an effective Inspector
General.
In addition to my present position with the GSA, I headed--for
almost 4 years--the OIG's compliance office reporting directly to the
GSA Inspector General. From there, I stood up the GSA OIG's first audit
report writing and editing team. As lead editor, I oversaw the
production of the OIG's audit reports--an OIG's first-line of
communication with its agency. Our team's objective was to ensure that
an audit report was readable, objective, and usable.
Throughout its history, Ex-Im's unique mission has helped finance
the export of American goods and services in order to support American
jobs.
If confirmed, my goal will be to provide Ex-Im's leaders with
timely and objective findings and understandable and usable
recommendations regarding the Agency's programs and operations and to
inform Ex-Im's leaders of any fraud, waste, or abuse the OIG uncovers.
If confirmed, I commit to overseeing rigorous investigations to
pursue the facts wherever they may lead.
As a Senator Grassley alum, he set the standard for me, among many,
when it comes to Inspectors General and educated me on the key role an
OIG plays in an agency's success. Senator Grassley taught me that
whistleblowers are to be respected and taken seriously.
If I am confirmed, I will ensure that the Office of Inspector
General at Ex-Im has an open-door policy and provides every opportunity
for those who want to report on information that they may have on any
waste, fraud, or abuse occurring at Ex-Im. If I am confirmed, the
Office of Inspector General will see to it that whistleblowers receive
every protection afforded to them by the law.
I am also well aware of Congress' role in the responsible use of
taxpayer resources. If confirmed, I intend to maintain a strong and
open line of communication with this Committee, the Senate, and the
House of Representatives.
Mr. Chairman, my time with GSA OIG has attuned me to the role a
fully functioning, objective, and independent Office of Inspector
General plays in an agency's success. I call this ``regular order.''
I understand Ex-Im has strong supporters and strong detractors. As
you know, Ex-Im's Board of Directors has only recently returned to
regular order with a quorum.
This is all the more reason to return Ex-Im's Office of Inspector
General to its own regular order. Since the Ex-Im Inspector General
position became vacant in June 2014, the OIG's dedicated professionals
have supported its continued operations. But Senate confirmed
leadership in an independent Office of Inspector General is more likely
to have greater influence on Ex-Im, and more likely to have the
confidence of Ex-Im's proponents, as well as its detractors.
My approach as Inspector General would not be to act as Ex-Im's
adversary or its enemy. Instead, I would intend to foster a healthy,
productive, and open professional relationship with Ex-Im.
Along with restoring a sense of regular order to Ex-Im's Office of
Inspector General--if confirmed--I would like to review several
programs and initiatives that I have read about in the OIG's last two
Semi-Annual Reports to Congress.
In conclusion, Mr. Chairman, if I am fortunate enough to be
confirmed, I firmly believe that I am prepared to take the helm of the
Office of Inspector General at the Export-Import Bank of the United
States, and I look forward to the challenge.
Thank you for your time today. I will be pleased to respond to any
questions you may have.
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RESPONSES TO WRITTEN QUESTIONS OF SENATOR BROWN
FROM MITCHELL A. SILK
Q.1. Please describe all energy and infrastructure projects you
worked on while at Treasury that connected foreign countries
with U.S. partners. For each project, please include:
how your office identified the project,
the nature of the project,
the current status of the project,
the parties involved (i.e., which U.S. and/or
foreign Governments and companies partnered with which
countries), and
whether climate change was considered in the course
of the project, and if so, what particular issues were
considered and how were they addressed.
A.1. Treasury's energy and infrastructure projects can be
broadly divided into two regional initiatives in Latin America
and Asia. The main focus of Treasury's work in both regions is
to identify investment initiatives in partner countries and
work with our partners to create enabling environments that
will catalyze private capital solutions for these initiatives.
To that end, Treasury has pursued bilateral energy and
infrastructure financing frameworks with partner countries in
these regions, and advanced bilateral work under these
agreements. Treasury's efforts focus primarily on the macro and
systemic issues rather than at the specific project level. In
order to achieve scale and impact through these initiatives,
most focus on programmatic investment opportunities, though
some initiatives revolve around large, capital-intensive
projects.
As the President's 2017 National Security Strategy makes
clear, stable, friendly and prosperous States in Latin America
enhance U.S. security and benefit the U.S. economy. Therefore,
Latin America was Treasury's first region of focus for its
energy and infrastructure initiatives. Treasury has signed
bilateral energy and infrastructure financing frameworks with
Chile, Argentina, Panama, Colombia, and Jamaica. We are
actively working to negotiate and sign frameworks with
additional partners in the region and sometimes provide advice
to other regional partners even in the absence of official
frameworks. We are focused on unlocking private capital
solutions for investment initiatives in areas including, but
not limited to, transmission infrastructure, regional
interconnection, power and electricity generation, grid
management solutions to ensure system stability (including
facilitating renewables), renewables ``value add'' projects
(such as energy storage), energy efficiency, and energy and
infrastructure financial market development.
Given Asia's status as one of the most economically dynamic
regions globally, the Trump administration has made Asia a key
area of focus for U.S. economic statecraft. Treasury has
supported the Trump administration's efforts in Asia by
developing a regional energy and infrastructure financing
program that shares certain areas of focus with Treasury's work
in Latin America. Treasury's initiatives in Asia can be divided
between work with middle income partner countries and high
income partner countries. In middle income partner countries,
the goal is to identify similar investment initiatives as in
Latin America and create the enabling environment to catalyze
private capital solutions for investment in those areas. In
high income partner countries, Treasury's initiatives seek to
enhance energy and infrastructure financial markets to catalyze
additional institutional investment in energy and
infrastructure projects in the region. Treasury has signed
bilateral energy and infrastructure financing frameworks with
South Korea, Singapore and Vietnam. We are actively working to
negotiate and sign frameworks with additional partners in the
region.
An example of a project undertaken through Treasury's
initiatives includes work we have undertaken with Panama's
primary utility, ETESA. Treasury's Office of Technical
Assistance (OTA) and Office of Energy and Infrastructure have
worked with ETESA in areas including debt capacity, asset
management, and governance. With respect to debt capacity, OTA
has worked extensively to assist ETESA to allow for additional
and more efficient debt financing to fund much needed expansion
of transmission, interconnection and distribution capacity,
including capacity critical to address grid stability that will
accommodate increases of renewable energy capacity to the
system. Treasury's work contributed to ETESA achieving a long-
term private capital markets refinancing of a number of short-
term, high priced loans and ETESA's securing a favorable credit
rating. We estimate that Treasury's work will result in debt
service savings for ETESA of up to $47 million over the
lifetime of its new $500 million bond.
Environmental protection is a key component of Treasury's
energy and infrastructure finance initiatives. For example,
Treasury is working to create enabling environments for
enhanced private investment in (1) grid solutions that will
accommodate increased power production through renewables and
(2) retrofitting and refurbishment programs designed to reduce
carbon emissions in partner countries reliant on fossil fuel
power generation. In area (1), many of Treasury's partners have
embarked on aggressive programs to increase power production
capacity through renewable sources such as solar and wind. The
intermittency of production through solar and wind present
significant challenges to grid management and stability. Thus,
significant investment in transmission and interconnection is
typically required in order for renewable power production to
achieve its desired benefits. In area (2), many of Treasury's
partners are presently heavily reliant on fossil fuel in the
power generation that supports their industrial growth. Many of
our middle income Asian partner countries are over 80 percent
reliant on fossil fuel. One of our initiatives proposes
retrofitting and refurbishment of downstream power generation
in those jurisdictions reliant on fossil fuel to achieve the
two important goals of substantially reducing (a) carbon
emissions as these countries transition to cleaner forms of
power generation and (b) operation and maintenance costs.
Q.2. To the extent possible, please describe the projects that
you expect to advance in the next year. If you are unable to
describe a project, please indicate why.
A.2. In the next year, we expect to advance Treasury's
initiatives in both Latin America and Asia. Specifically, we
expect to: (1) sign energy and infrastructure financing
frameworks with additional partner countries that are currently
under negotiation; and, (2) continue work under existing
frameworks to create enabling environments to help catalyze
private capital investment in partner countries' energy and
infrastructure markets. We are presently at an advanced stage
of negotiation with Brazil and Peru in Latin America, and the
Philippines and Thailand in Asia. We have been working with
additional countries in both regions. Specific examples of
continued work under existing frameworks include initiatives to
enable investments in portfolios of (a) micro- and mini-grid
solutions suitable for (i) public facilities, (ii) private
facilities and (iii) rural communities; and (b) municipal
multimodal energy efficiency projects.
Q.3. To what extent is climate change considered during project
selection and design? What, if any, climate policy goals do you
seek to accomplish with each project?
A.3. Environmental protection is a key component of Treasury's
energy and infrastructure finance initiatives. For example,
Treasury is working to create enabling environments for
enhanced private investment in (1) grid solutions that will
accommodate increased power production through renewables and
(2) retrofitting and refurbishment programs designed to reduce
carbon emissions in partner countries reliant on fossil fuel
power generation. In area (1), many of Treasury's partners have
embarked on aggressive programs to increase power production
capacity through renewable sources such as solar and wind. The
intermittency of production through solar and wind present
significant challenges to grid management and stability. Thus,
significant investment in transmission and interconnection is
typically required in order for renewable power production to
achieve its desired benefits. In area (2), many of Treasury's
partners are presently heavily reliant on fossil fuel in the
power generation that supports their industrial growth. Many of
our middle income Asian partner countries are over 80 percent
reliant on fossil fuel. One of our initiatives proposes
retrofitting and refurbishment of downstream power generation
in those jurisdictions reliant on fossil fuel to achieve the
two important goals of substantially reducing (a) carbon
emissions as these countries transition to cleaner forms of
power generation and (b) operation and maintenance costs.
Q.4. How will you use your role in international fora to
advocate for policies and projects that address climate change?
A.4. Since I joined the Treasury Department in 2017, I have
worked to enhance environmental protection in the context of
Treasury's international work. As discussed above,
environmental protection is a key component of Treasury's
energy and infrastructure finance initiatives. For example,
Treasury is working to create enabling environments for
enhanced private investment in (1) grid solutions that will
accommodate increased power production through renewables and
(2) retrofitting and refurbishment programs designed to reduce
carbon emissions in partner countries reliant on fossil fuel
power generation. In area (1), many of Treasury's partners have
embarked on aggressive programs to increase power production
capacity through renewable sources such as solar and wind. The
intermittency of production through solar and wind present
significant challenges to grid management and stability. Thus,
significant investment in transmission and interconnection is
typically required in order for renewable power production to
achieve its desired benefits. In area (2), many of Treasury's
partners are presently heavily reliant on fossil fuel in the
power generation that supports their industrial growth. Many of
our middle income Asian partner countries are over 80 percent
reliant on fossil fuel. One of our initiatives proposes
retrofitting and refurbishment of downstream power generation
in those jurisdictions reliant on fossil fuel to achieve the
two important goals of substantially reducing (a) carbon
emissions as these countries transition to cleaner forms of
power generation and (b) operation and maintenance costs.
If confirmed, I would leverage my role in other
international fora (including outside of the energy and
infrastructure context) to continue to promote policies that
appropriately advance environmental protection.
Q.5. What are your priorities as Treasury representative for
the Financial Stability Board's Standing Committee on
Assessment of Vulnerabilities?
A.5. The Financial Stability Board's (FSB) Standing Committee
on Assessment of Vulnerabilities (SCAV) is tasked by the FSB
with monitoring and assessing vulnerabilities in the global
financial system and proposing to the FSB Plenary actions
needed to address these vulnerabilities. Treasury's Under
Secretary for International Affairs is Treasury's designated
member of the SCAV. The Under Secretary has from time to time,
however, delegated responsibility for representing the Treasury
Department at the SCAV to the Assistant Secretary for
International Markets.
To the extent that I participate in the SCAV either in my
current Acting capacity or, if confirmed, as the Assistant
Secretary for International Markets, my priorities would lie in
two areas. First, I would seek to support U.S. interests at the
SCAV, particularly by preventing outcomes at the SCAV that
would contravene U.S. interests. Second, I would leverage my
30-year history operating in the financial markets globally and
the immense expertise of Treasury's career staff to provide
market insights in order to further the SCAV's mission of
vulnerability identification and development of policies to
remedy vulnerabilities. Such areas of focus for vulnerability
identification may include, but are not limited to, nonbank
financial intermediation, LIBOR transition, data localization,
and digital assets (including stablecoins).
Q.6. In your work prior to joining Treasury, did you provide
any services or legal advice on projects related to China's
Belt and Road Initiative? If so, please describe them.
A.6. Prior to joining Treasury, I regularly represented Chinese
clients with respect to banking and corporate transactions,
including in the energy and infrastructure sectors, but I did
not provide any services or legal advice to projects that
identified with China's Belt and Road Initiative. I believe
that China's Belt and Road Initiative, which was announced in
2013, poses a clear threat to U.S. interests and those of our
allies and partners around the world. As I discussed in my
opening statement, I have 30 years of experience working on
large and complex cross-border investment, bank regulatory, and
finance matters, focusing heavily on the energy and
infrastructure sectors. Since joining Treasury, I have put my
experience to work advancing U.S. interests including by
offering allies and partners alternatives to projects of the
type that are associated with China's Belt and Road Initiative,
with a view toward providing healthy global growth solutions.
If confirmed, I will continue to do so.
Q.7. How should the United States ensure foreign countries have
alternatives to China for infrastructure projects? What
resources should Congress provide to that end?
A.7. In order to ensure that foreign countries have
alternatives to China for infrastructure projects, the U.S.
Government should continue to pursue initiatives in the area of
global infrastructure development and finance. These programs
will support our partners in making necessary governmental
reforms in order to create an enabling environment for
infrastructure projects to be led and financed by the private
sector. Working in tandem with institutions such as the U.S.
International Development Finance Corporation and the World
Bank, private sector investments in infrastructure are the key
to providing a sustainable, market based alternative to China's
unsustainable, nonmarket practices in the area of global
infrastructure. These solutions leverage the comparative
advantage that the U.S. has in its deep and liquid capital
markets. The U.S. must also work on ensuring that global
infrastructure projects are transparent and subject to
governance best practices. To this end, the U.S. recently
joined with our partners to develop the G20's Principles for
Quality Infrastructure Investment, which have at their core a
commitment to transparency and anticorruption in infrastructure
development and finance.
The Administration is currently working with Congress to
stand up the U.S. International Development Finance Corporation
and authorize a capital increase for the World Bank. These
initiatives, combined with existing bilateral and multilateral
development efforts, including Treasury's efforts to unlock
private capital, will provide significant resources through
which the United States, our allies, and partners can offer
alternatives to Chinese investment in infrastructure.
------
RESPONSES TO WRITTEN QUESTIONS OF SENATOR REED
FROM MITCHELL A. SILK
Q.1. I was a cosponsor of the Better Utilization of Investments
Leading to Development (BUILD) Act, which became law last year.
I believe that China represents a generational challenge that
requires a whole of Government approach. This law and the new
International Development Finance Corporation it created will
be an important tool to counter China's growing influence,
particularly as it relates to its Belt and Road Initiative, but
also will be useful in our stabilization and countering violent
extremism efforts.
If confirmed, do you commit to fully implement the BUILD
Act and that you will work to ensure that efforts to stand up
the new Development Finance Corporation are successful?
A.1. The BUILD Act is a critical component of modernizing the
U.S.' approach to development finance and advancing U.S.
interests globally. I commit, if confirmed, to working to both
implement the BUILD Act and ensure that efforts to stand up the
new Development Finance Corporation are successful.
Q.2. Please explain the role that you believe that foreign and
development assistance plays in American efforts to counter
violent extremism and Chinese influence across the globe.
A.2. I believe that foreign assistance and development
assistance can each play an important role in American efforts
to counter violent extremism and Chinese influence across the
globe. With respect to foreign assistance, this important area
of work can help build foreign Government capacity to more
effectively manage private sector-led economic growth, thereby
serving as a contributing factor to counter violent extremism
and Chinese influence. For example, Treasury's Office of
Technical Assistance provides technical expertise to foreign
Governments on designing procurement processes, which help
ensure that the private sector can compete in foreign
countries, enhancing economic growth over the long-term.
In the case of development assistance, the U.S.'
development assistance efforts, and the new International
Development Finance Corporation in particular, are critical to
providing solutions in areas and projects where the private
market may not be otherwise able to meet requirements, and the
provision of U.S. development finance to these areas or
projects is supportive of U.S. national interests.
------
RESPONSES TO WRITTEN QUESTIONS OF
SENATOR MENENDEZ FROM MITCHELL A. SILK
Q.1. I am increasingly concerned that the United States is not
well positioned to engage in economic statecraft for the
twenty-first century, including promoting U.S. jobs, business
and economic interests, engaging in development financing for
infrastructure and other needs--including climate change-
related resiliency--and setting standards for emergent
technologies and the digital economy. As I work on a bill that
would address these goals, I want to get your perspective on
the current tools of our economic statecraft that you would
have in your toolkit.
Can you expand upon how you view your role and your
institution's role, if you are confirmed, in helping to renew
and replenish U.S. economic statecraft instruments?
A.1. The Treasury Department is focused on the conduct of
economic statecraft as part of its core objective of supporting
U.S. interests. Specifically, Treasury's Strategic Plan
provides for five strategic goals, each of which supports this
core objective: (1) boost U.S. economic growth; (2) promote
financial stability; (3) enhance national security; (4)
transform Government-wide financial stewardship; and (5)
achieve operational excellence.
If confirmed as Assistant Secretary for International
Markets, I would focus on strategic goals (1)-(3), where the
Assistant Secretary for International Markets has a leading
role. This includes import work in the following areas:
Advancing international financial stability through
development of international financial regulatory
policies, including through engagement with
international bodies like the Financial Stability Board
(FSB);
Supporting the Administration's efforts to
rebalance the U.S.' trading relationships and protect
U.S. firms and workers against unfair foreign trade
practices, especially with respect to financial
services;
Assisting allies globally with budget management,
procurement processes, and other technical functions
through our Office of Technical Assistance; and
Promoting private capital solutions in energy and
infrastructure finance to support responsible global
growth.
Q.2. Where do you see the biggest challenges and opportunities?
A.2. The biggest challenge that the U.S. faces internationally
is competition with nonmarket economies that threaten long-term
global economic growth and seek to actively thwart U.S.
interests abroad. With respect to opportunities, there are
abundant opportunities globally to advance U.S. interests by
promoting development of market-based solutions that support
global and U.S. economic growth, which will enhance U.S.
national security in the process. In particular, compelling
opportunities are the rebalancing of the U.S.' trade
relationships and the development of private capital solutions
to global energy and infrastructure finance needs.
------
RESPONSES TO WRITTEN QUESTIONS OF SENATOR WARREN
FROM MITCHELL A. SILK
Q.1. What do you consider to be the greatest risks to
international financial stability?
A.1. The Treasury Department is constantly monitoring risks to
both domestic and international financial stability, and, if
confirmed as Assistant Secretary for International Markets, I
would support the Department's critical work in this area.
Certain recent areas of focus include, but are not limited to,
Brexit, Central Counterparty Clearing (CCP), wholesale funding
market structure, cybersecurity, reference rate transition, and
the financial market implications of long-term changes in the
conduct of global monetary policy.
Q.2. How will you engage with the international financial
regulatory bodies such as the Financial Stability Board to
monitor and mitigate those risks?
A.2. If confirmed as Assistant Secretary for International
Markets, to the extent that I am engaged with international
financial regulatory bodies, including the Financial Stability
Board (FSB), I would focus on working with those bodies to
monitor and develop policies to mitigate risks to international
financial stability. In particular, I would leverage the
immense expertise of Treasury's career staff in engaging with
these bodies. My professional background, including 30 years of
experience in financial markets and history as a bank
regulatory lawyer, would also inform my engagement.
Q.3. What structural reforms do you believe are needed to
increase the access of American exporters to international
markets?
A.3. At the most general level, the structural reforms that
would increase American exporter access to international
markets are those that would support and enable private capital
solutions to support such exports. These reforms would vary
from country to country, and include policy, legal, regulatory,
financial market and institutional reforms. At a more specific
level, the primary structural reforms needed to increase the
access of American exporters to international markets involve
the removal of barriers that foreign Governments have imposed
that prevent American exporters from fair access to their
markets. These barriers can include both tariff and nontariff
barriers. The Administration is actively engaged in removing
these barriers to U.S. exports, including, but not limited to,
unfairly high tariffs on American exports, weak intellectual
property protections, forced technology transfers, excess
industrial capacity, and lack of enforceable dispute resolution
mechanisms.
Q.4. You previously worked as a senior partner at the law firm
Allen & Overy LLP.
Describe the types of clients you represented as well as
some of the major cases that you worked on.
A.4. During my legal career, I specialized in large and complex
cross-border finance, investment and asset management matters,
as well as bank regulatory issues. With respect to cross-border
finance matters, I represented some of the largest, most
sophisticated global financiers (commercial banks, multilateral
development banks, export credit agencies, and other financial
institutions) on large and complex financings internationally.
Many of these transactions financed large energy and
infrastructure projects. In my cross-border investment work, I
represented large corporations in cross-border direct
investments completed through mergers, acquisitions, and joint
ventures. Many, but not all, of these transactions were in the
energy and infrastructure and financial services sectors. In
the area of asset management, I mainly represented large asset
managers in the structuring and formation of cross-border
private investment funds, including regulatory structuring
exercises across numerous jurisdictions. With respect to bank
regulatory matters, I represented numerous foreign banks before
the Federal and New York State banking regulators in connection
with over 50 applications for licenses and charters to expand
their banking operations in the United States. I also assisted
U.S. and European financial institutions with financial
regulatory matters relating to their expansion into the Chinese
market.
Q.5. Did you represent any individual or entity that could
materially impact from policies that you will help develop?
A.5. Any potential conflicts of interest have been identified
and resolved in accordance with the terms and conditions of my
ethics agreement with the Department of the Treasury, which is
documented by letter to Treasury's Designated Agency Ethics
Official and Assistant General Counsel for General Law, Ethics,
and Regulation. Should any potential conflict of interest arise
in the future, I will seek guidance from a career Treasury
ethics official.
Q.6. Are you aware of any conflicts of interests associated
with current issues in your portfolio at Treasury that could
impact the clients and issues that you worked on as private
attorney?
If so, please list them and describe how you intend to
resolve them.
Should any such conflicts arise resulting from new matters
that emerge within your portfolio, will you commit to recuse
yourself from all deliberations associated with those matters?
A.6. Any potential conflicts of interest have been identified
and resolved in accordance with the terms and conditions of my
ethics agreement with the Department of the Treasury, which is
documented by letter to Treasury's Designated Agency Ethics
Official and Assistant General Counsel for General Law, Ethics
and Regulation. Should any potential conflict of interest arise
in the future, I will seek guidance from a career Treasury
ethics official.
------
RESPONSES TO WRITTEN QUESTIONS OF SENATOR BROWN
FROM BRIAN D. MONTGOMERY
Q.1. In its Housing Finance Reform Plan HUD proposed to move
Federal Housing Administration (FHA) insurance pricing from
level pricing to tiered pricing ``to diminish the drain of
FHA's higher risk loans on the MMIF.''
What borrower or loan characteristics would FHA use to set
pricing tiers under this proposal?
How would tiered FHA pricing affect housing costs and
access to credit for the lowest income borrowers and those who
struggle to access home ownership? Please provide any models or
data that FHA has produced to model the impact of this proposal
on different subsets of borrowers.
How would tiered FHA pricing affect the size and
characteristics (for example, average loan size, average credit
score, average borrower income) of the entire FHA book of
business?
Has FHA conducted an analysis of any disparate impacts on
protected classes under the Fair Housing Act that a tiered
pricing system might cause? If so, please share that analysis.
If not, would FHA or any other office within HUD conduct such
an analysis before moving forward with a tiered pricing
proposal?
In its Housing Finance Reform Plan HUD proposed to make FHA
an autonomous corporation to ``provide FHA greater control over
staffing and procurement, including technology.''
Please describe how FHA and other Offices within HUD rely
on Department-wide staffing and procurement resources.
If FHA currently relies, in whole or in part, on human
capital and procurement through a Department-wide office or
function, why are those Department-wide offices insufficient
for FHA?
Do those Offices currently meet all of the staffing and
procurement needs of HUD's other offices?
If so, why are the staffing and procurement needs of FHA
not able to be served by these Department-wide functions? If
not, should staffing and procurement functions be improved for
the Department as a whole, rather than just for FHA?
As a corporation with additional control over staffing and
procurement, would FHA need additional staff and other
resources beyond what is required or projected under the
current structure to support staffing and procurement
functions?
FHA is currently subject to appropriations, and receipts
from FHA help fund other critical programs within HUD.
Under the corporation structure that you have proposed,
would FHA still be subject to the appropriations process
exactly as it is today?
If FHA is still subject to the appropriations process
exactly as it is today, would FHA request additional
appropriations to fund staffing and procurement needs under a
corporation structure?
If FHA's appropriations status is altered to reduce or
eliminate any offsetting receipts that can be used by Congress
to fund other functions of the Department, would HUD and the
Trump administration request and advocate for sufficient
funding to maintain all HUD services at current or higher
funding levels, including appropriately adjusted rental
subsidies, throughout the rest of the Department?
If FHA is still subject to the appropriations process
exactly as it is today, what are the benefits of moving FHA to
a corporation structure?
Mr. Montgomery, in HUD's Housing Finance Reform Plan said
that FHA should provide a path for borrowers to ``graduate to
nongovernment-supported mortgages'' and raised questions about
whether borrowers getting a second FHA loan was consistent with
FHA's mission.
As you know, FHA is not just a first-time home buyer
program.
Why would HUD limit creditworthy borrowers' participation
in the FHA program?
A working paper published by the Federal Housing Finance
Agency showed no meaningful difference in loan performance
between first-time and repeat home buyers once other
characteristics were controlled for. \1\ Does FHA have reason
to believe that the performance of first-time home buyers
relative to the performance of repeat home buyers within its
portfolio is meaningfully worse? If so, please share that
analysis. If not, please explain why HUD believes it may be
appropriate to limit FHA mortgages to first-time home buyers,
rather than offering repeat borrowers the option to choose the
mortgage product that is best for their financial
circumstances.
---------------------------------------------------------------------------
\1\ https://www.fhfa.gov/PolicyProgramsResearch/Research/
PaperDocuments/FHFA_Working_Paper_15-2.pdf
A.1. Thank you for your Questions regarding HUD's plan to
reform the Nation's housing finance system. The Housing Finance
Reform Plan, which I'm pleased to have played a leading role in
developing, is a comprehensive compilation of administrative
and legislative proposals. As you note in your questions, the
administrative reforms include recommendations that FHA develop
and implement a tiered pricing system in order to protect the
Mutual Mortgage Insurance Fund and ensure it is pricing
appropriately for higher-risk loans, and that FHA should
examine the impact of repeat borrowers on the MMIF and ensure
these loans are consistent with its mission, in particular
borrowers using downpayment assistance with higher default
rates. With respect to legislative proposals, the plan
recommended that Congress enact legislation to restructure FHA
as an autonomous Government corporation within HUD top help
promote administrative flexibility and to better ensure FHA has
a consistent level of funding for technology year-to-year. We
appreciate the interest you are taking in these specific
recommendations.
As the Department develops proposals to implement these
recommendations, we would be pleased to brief you and your
staff and respond to any concerns you may have. Furthermore, as
Secretaries Carson and Mnuchin also stated during their
testimony before the Committee, the Administration is committed
to working with the Senate Banking Committee on comprehensive,
bipartisan housing reform legislation.
Q.2. HUD's Housing Finance Reform Report repeatedly mentions
returning FHA to its core mission. How do you define FHA's core
mission?
A.2. FHA serves the American taxpayers through the core
functions of providing countercyclical liquidity in the housing
market in the event of an economic downturn and fostering
increased home ownership and affordable rental opportunities
for qualified low- to moderate-income individuals.
Q.3. In FHA's FY2019 Annual Report to Congress Regarding the
Status of the FHA Mutual Mortgage Insurance Fund, you noted
that third party sales of FHA loans now make up about two-
thirds of all FHA loan dispositions. This is far greater than
REO dispositions, which made up just over one quarter of all
FHA loan dispositions.
The shift away from REO to third party sales has been
sizable. As recently as 2013, REO still made up the vast
majority of FHA dispositions. But it is not clear what impact
third party sales have on the local markets or the availability
of starter homes. Unlike REO properties, properties disposed
through a third party sale are not available for HUD
revitalization initiatives, like the Revitalization Area Sales
Program and Good Neighbor Next Door Program. They are also not
available for bulk sale to local governments and nonprofits who
can make these properties available at a reasonable cost to
lower-wealth home buyers, consistent with HUD's mission.
Does FHA collect data on the purchaser of and the ultimate
outcome for all FHA loans that are disposed of through third
party sales?
If so, what proportion of properties sold through the
third-party sales process go directly or indirectly to a
resident for home ownership or a nonprofit intending to prepare
the property for home ownership, and what proportion are sold
directly or indirectly to institutional investors, single-
family rental companies, or other nonresident owners?
If not, why does FHA not collect this data? Does FHA intend
to begin collecting this data?
How has the transition from a predominantly REO,
conveyance-based asset disposition process to a predominantly
third party sales, claim without conveyance of title-based
asset disposition process impacted FHA Revitalization Areas and
initiatives like the Good Neighbor Next Door program?
Do you believe that FHA asset disposition strategies are a
component of HUD's overall mission?
A.3. FHA does not currently have the capability to collect
information on the purchaser and ultimate outcome of properties
disposed through third party sales. It is important to note
that foreclosed properties are insured by HUD, but not owned by
HUD, at the time of a third-party sale. Also, the foreclosure
sale process is open to the public to purchase foreclosed
properties, including but not limited to private individuals,
nonprofits, and local investors.
HUD believes that increasing the number of properties sold
at third party sale has benefited communities and taxpayers.
The benefit of selling properties through a third-party sale is
that it allows the property to be sold more quickly, thus
reducing neighborhood blight and potential vandalism that can
occur with foreclosed properties. The other major benefit of
third-party sales is that it has resulted in a significant
reduction in losses to the MMI fund. In FY2019, the average
loss severity rate on all disposed properties declined to a 13-
year low of 40.73 percent. One of the key reasons for the
reduction in loss severity is the increase in properties sold
as third-party sales.
HUD believes that effective property disposition strategies
are a key component to ensuring a sustainable FHA program for
low- and moderate-income homeowners.
Q.4. HUD recently promoted Eric Blankenstein to be Executive
Vice President of the Government National Mortgage Association
(Ginnie Mae). In May 2019, Mr. Blankenstein resigned from the
Consumer Financial Protection Bureau (CFPB) shortly after the
Federal Reserve Inspector General issued a report stating that
Mr. Blankenstein may have abused his authority, may have
misused his position for private gain, and had created an
appearance of a violation of the Standards of Ethical Conduct
for Employees of the Executive Branch. As I stated in a letter
sent to Secretary Carson in July 2019, it is my understanding
that HUD officials requested the Inspector General's report in
June 2019.
Were you involved in or aware of the decision to hire Eric
Blankenstein as a Senior Counsel at HUD, a position he started
on June 24, 2019?
If you were involved in the decision to hire Mr.
Blankenstein, did you recommend that HUD hire Mr. Blankenstein?
If you were involved in or aware of the decision to hire
Mr. Blankenstein, did you review the Inspector General report
on Mr. Blankenstein's conduct at CFPB prior to the decision to
hire Mr. Blankenstein? If you did not review the report, why
not?
Were you involved in or aware of the decision to promote
Mr. Blankenstein to the position of Executive Vice President at
Ginnie Mae?
If you were involved in the decision to promote Mr.
Blankenstein, did you recommend that HUD promote Mr.
Blankenstein?
If you were involved in or aware of the decision to promote
Mr. Blankenstein, did you review the Inspector General report
on Mr. Blankenstein's conduct at CFPB prior to the decision to
promote Mr. Blankenstein? If you did not review the report, why
not?
Did you ever have any conversations with White House staff
regarding the decision to hire or promote Mr. Blankenstein?
Do you believe it is appropriate to promote an employee who
has been the subject of Inspector General findings, including
findings related to possible abuse of authority, possible
misuse of their position for private gain, and the appearance
of a violation of the Standards of Ethical Conduct for
Employees of the Executive Branch, within the same year as
those findings were made?
A.4. HUD does not comment on personnel matters.
------
RESPONSES TO WRITTEN QUESTIONS OF SENATOR MORAN
FROM BRIAN D. MONTGOMERY
Q.1. Agencies under the jurisdiction of this Committee have
worked recently to transfer financial risk from taxpayers into
the private reinsurance market. Specifically, the Ex-Im Bank
and the National Flood Insurance Program (NFIP) have entered
into reinsurance arrangements to reduce exposure in case of a
spike in defaults or another catastrophic weather event,
respectively. In fact, NFIP was able to recover over $1 billion
for the taxpayer after Hurricane Harvey hit Houston in 2017.
In the housing finance market, Fannie Mae and Freddie Mac
have established risk transfer programs using the private
market to transfer some of the GSE's risk on a majority of loan
acquisitions. Would this type of arrangement also help protect
taxpayers who are backing FHA in the event of another
significant housing downturn? Will you commit to looking into
this issue during your tenure as Deputy Secretary and update me
on your efforts?
A.1. To better protect American taxpayers, it is appropriate to
develop and implement a risk management framework that will
better allow FHA to measure and monitor current, emerging and
future mortgage credit risk. An economically viable Credit Risk
Transfer (CRT) program would introduce private sector
investment and reduce the risk to the overall FHA portfolio and
taxpayers. It is important for FHA to continue to evaluate the
options, feasibility, and economics of a CRT program with the
purpose of exploring options to reduce the overall risk to the
taxpayer and still serve our mission borrowers. I look forward
to the opportunity to keep you updated on these efforts which
are ongoing.
------
RESPONSES TO WRITTEN QUESTIONS OF SENATOR REED
FROM BRIAN D. MONTGOMERY
Q.1. This year, President Trump proposed cutting $12 billion in
affordable housing and economic development programs. This
included requesting no money at all for HOME and the Community
Development Block Grant Program.
Do you support these proposed cuts?
If not, what will you do to advocate for HOME and the
Community Development Block Grant before the President submits
his budget request for Fiscal Year 2021?
A.1. The budget process is an iterative one between Congress
and the Administration. Both the House and the Senate have
included funding for CDBG and HOME in their respective THUD
appropriations bills. I can commit to you that whatever
resources Congress sees fit to provide to HUD, we will utilize
those resources wisely and efficiently.
------
RESPONSES TO WRITTEN QUESTIONS OF
SENATOR MENENDEZ FROM BRIAN D. MONTGOMERY
Q.1. Over the last few years, HUD has relocated key multifamily
housing staff from its office in Newark to the New York
regional office. As a former mayor, I understand that this
presents a significant challenge for landlords, property
managers, and residents. It's critical that we have HUD boots
on the ground that are familiar with the local conditions and
issues facing residents throughout the State. Mr. Montgomery,
if confirmed, what are you going to do to make sure the Newark
office has the staff it needs and that New Jersey remains a
priority at HUD?
A.1. I appreciate you bringing this important issue to my
attention during our meeting. I want to commit to you that I
will have my senior FHA staff conduct a thorough quality
control review of the Northeast Region Multifamily Office to
determine whether or not the required level of responsiveness
is being provided during all aspects of the multifamily loan
life cycle, from predevelopment through closing. The review
will also provide response rates to New Jersey-based asset
oversight inquiries on FHA-insured and HUD-subsidized
portfolios, Project-Based Section 8, Section 202 and Section
811. If we find anomalies in acceptable service, I will
personally meet with my leadership team--including our
Northeast Region Multifamily Director and production,
underwriting, asset management, appraisal and construction
analysis staff--to determine the source of the disruption in
service and possible next steps to remedy the situation.
I will also commit to implement any changes necessary to
improve service delivery to the New Jersey market. We have 187
highly capable FHA colleagues in the Northeast Region dedicated
to working with our New Jersey lender and developer/owner
partners, and most importantly our residents. If you or your
staff are aware of specific instances in which New Jersey is
receiving inadequate multifamily coverage from HUD, I urge you
to bring them to my attention.
Q.2. Congress recently appropriated funding for FHA to upgrade
the agency's infrastructure and operating systems. Mr.
Montgomery, can you please provide details on the type of
improvements FHA is planning, the timeline for implementing the
upgrades, and the benefits taxpayers, lenders, and borrowers
can expect from these upgrades?
A.2. FHA is undertaking a comprehensive, multiyear
modernization effort to bring its Information Technology (IT)
infrastructure into the 21st century. We are actively
developing a new, single platform that aligns with mortgage
industry standards and digitizes the overall mortgage process.
Initially focusing on the Single Family forward mortgage
program, this modernization effort will create a new data-rich
environment, opening the doors to advanced risk analytics,
cost-saving and operational efficiencies, and, ultimately,
ensuring borrowers are receiving financing that is appropriate,
sustainable, and optimized for long-term home ownership. FHA is
actively engaged with the mortgage industry and consumer groups
to coordinate implementation timelines and to ensure the new
platform meets the needs of all internal and external
stakeholders.
Together, FHA and the Office of the Chief Information
Officer are working diligently to bring this modernization
effort to reality and have identified key milestones in the FHA
Single Family IT Modernization Expenditure Plan.
In addition, please see the video below on FHA's
modernization project: https://www.linkedin.com/posts/fed-
housing-admin-today-hud-cio-david-chow-unveiled-a-new-activity-
6594680537078648833-L47r.
------
RESPONSES TO WRITTEN QUESTIONS OF SENATOR WARREN
FROM BRIAN D. MONTGOMERY
Q.1. At your nomination hearing you stated it is ``important to
preserve and hold on and renovate the aged housing stock.''
HUD's requested budget for fiscal year 2020 includes no funding
for the Public Housing Capital Fund. There is currently an
estimated $70 billion backlog in critical repairs and
maintenance for existing public housing. This backlog results
in approximately 10,000 public housing units being lost every
year, and subjects tens of thousands of residents to living in
unsafe and unhealthy conditions.
Why did HUD decide to request no funding for the Public
Housing Capital Fund?
What role did you have in determining requested funding
levels for the Public Housing Capital Fund?
How does the elimination of funding for the Public Housing
Capital Fund comport with your stated commitment to preserving
aging public housing?
A.1. A program HUD is continuing to utilize to address the
sustainability of its public housing portfolio is the Rental
Assistance Demonstration (RAD). Thus far, 126,025 public
housing units have been converted under RAD and almost 10,000
units have been replaced by new construction. This amount of
construction has created an estimated 160,000 jobs. The kind of
Federal investments necessary to bring all public housing up to
standards and keep it there is overwhelming and unlikely to
materialize through the current program structure and
appropriations. An investment in RAD is a far better long-term
strategy.
Q.2. The U.S. Department of Treasury Housing Reform Plan
recommends getting rid of the affordable housing goals, and, as
an alternative, suggests, ``collect[ing] a periodic assessment
from guarantors that Congress would make available through an
appropriation to administer on-budget affordable housing.'' The
Trump administration budget request for fiscal year 2020 asks
Congress to zero out or deeply cut existing appropriated
programs that provide access to home ownership to low- and
moderate-income Americans including the HOME Investment
Partnerships Program, the Self-Help Homeownership Opportunity
Program, the Housing Trust Fund, and Native American Housing
Block Grants.
What role did you have in developing this recommendation?
Do you agree with this recommendation?
A.2. This question is best directed to the Department of the
Treasury.
Q.3. What was your involvement in putting together the 2019
Department of Housing and Urban Development's Housing Finance
Reform Plan? Did you review the plan before it was finalized?
A.3. While my understanding is that there were initial
discussions on housing finance reform before I rejoined the
Department on June 5, 2018, I was involved in all phases of the
drafting of HUD's Housing Finance Reform Plan beginning in
summer 2018.
Q.4. You served as Acting Deputy Secretary when HUD issued its
proposed Disparate Impact rule.
What was the clearance process for this rule? Please
provide a list of the titles of all career HUD employees and
names and titles of all appointed HUD employees involved and
their role in developing and approving this rule.
Were you part of the clearance process? Please provide all
emails from January 1, 2019, to August 31, 2019, in which you
send, receive, or are copied on discussion of the disparate
impact rule.
Who at HUD was primarily responsible for drafting the
disparate impact rule?
Did you provide performance reviews to any of individuals
referenced in question 4(a)? Did your performance reviews
include discussion of their work on the disparate impact rule?
At your nomination hearing, when asked about your role in
the disparate impact rule, you stated: ``going forward I'd be
more involved in that process.'' What would your increased
involvement with the disparate impact rule constitute, if you
are confirmed?
Are there any aspects of the disparate impact proposal that
you disagree with or would like to be strengthened?
A.4. HUD does not comment on its internal deliberative process
or personnel matters.
The comment period for this proposed rule closed on October
18, 2019, during which time HUD received a total of 45,757
comments. I believe HUD should seriously consider these
comments to make sure the disparate impact regulation is as
effective as possible. This will help plaintiffs bring better
supported claims and help defendants resolve unsupported claims
of discriminatory effect quicker.
Q.5. On May 15, 2018, in response to a question from my office
about your commitment to the HUD/Federal Financing Bank (FFB)
Risk-Sharing Program, you wrote that you had a ``commitment to
ensuring that this program remains active and successful'' and,
if confirmed to lead the Federal Housing Administration, you
would ``advocate for the continuation of this program and
sufficient loan commitment authority.'' You were confirmed--and
less than a year into your tenure, HUD stopped accepting new
applications for this program. The FY2020 HUD budget request
includes no funding for the program.
What was your involvement in HUD's decision not to extend
the HUD/FFB Risk-Sharing Program? Please provide all emails
from May 23, 2018, to December 31, 2018, involving you or your
staff regarding whether to extend the HUD/FFB Risk-Sharing
Program.
A.5. Prior to my confirmation as FHA Commissioner, I made a
commitment to you to advocate for continuing the Federal
Financing Bank Risk-Sharing Program, which was scheduled to be
terminated at the end of fiscal year 2018. I agreed with you
that this program had merit and deserved to be extended.
Ultimately, however, this was not a HUD program and therefore
not a HUD decision. Despite my best efforts, the program was
terminated, but not before we were able to provide for a
temporary extension that allowed it to accept additional
applications and utilize additional commitment authority until
the end of the calendar year.
Q.6. You stated that, if confirmed, you are likely to continue
running the FHA until a replacement is named. How will HUD
ensure that your dual duty will not impact the administration
of the FHA, especially given HUD's ongoing vacancy issues? How
will FHA leadership duties adjust if you are confirmed, and
before a replacement is named?
A.6. I am supported by an excellent staff, both in the Office
of the Deputy Secretary and in the Office of Housing. I have
been filling both of these roles without issue since January
2019.
Q.7. At your nomination hearing, in response to a question
about HUD Secretary Ben Carson raising the rents in federally
assisted housing, you stated: ``no mass evictions will occur as
long as I am FHA commissioner, Assistant Secretary for
Housing.''
FHA Commissioner is your current position. Are you planning
to implement policies that would lead to mass evictions if
confirmed as Deputy Secretary?
In your time serving as FHA Commissioner and Acting Deputy
Secretary, have you evaluated whether raising rents in
federally assisted housing would put individuals at risk of
eviction? If so, please provide any additional documents
produced by your office or staff; any emails involving you or
your staff on this question; and a list of evidence you have
considered.
If you have not evaluated this, will you commit to
evaluating the potential impact of rent raises on affordability
and potential evictions before issuing any proposals or taking
action to raise rents in federally assisted housing?
A.7. No mass evictions will occur if I am confirmed as Deputy
Secretary either.
Q.8. In response to being asked about whether there is an
affordable housing crisis, you stated: ``more so in some areas
versus others and there's a whole lot of reasons for that.''
Do you believe there is a national affordable housing
crisis?
What geographic areas do you believe are and are not
experiencing an affordable housing crisis, and what evidence
are you using to draw that conclusion?
What ``reasons'' are you referencing in suggesting that
some areas are not experiencing an affordable housing crisis?
A.8. I think any objective policymaker would acknowledge that
we don't have a single housing market in this country and
therefore access to affordable housing differs from one
jurisdiction to another. There are many reasons for that
including the fact that some cities and States place fewer
regulatory burdens for the development of affordable housing
than others.
To address access to affordable housing, Secretary Carson
is honored to serve as the Chair of the White House Council on
Eliminating Regulatory Barriers to Affordable Housing. The
Council is engaging with Governments at all levels and other
private-sector stakeholders to identify and remove obstacles
that raise the costs of affordable housing development and
contribute to shortages in America's housing supply.
------
RESPONSES TO WRITTEN QUESTIONS OF
SENATOR CORTEZ MASTO FROM BRIAN D. MONTGOMERY
Q.1. Please explain how HUD will mitigate the affordable
housing crisis?
A.1. See response to Question 2.
Q.2. Where do you think we have an affordable housing crisis?
Who is affected by the crisis?
A.2. In addition to HUD's existing programs that provide
affordable housing--such as the Federal Housing Administration,
public housing, Housing Choice Vouchers, and housing for the
elderly and disabled--Secretary Carson is honored to serve as
the Chair of the White House Council on Eliminating Regulatory
Barriers to Affordable Housing. The Council is engaging with
Governments at all levels and other private-sector stakeholders
to identify and remove obstacles that raise the costs of
affordable housing development and contribute to shortages in
America's housing supply.
Q.3. Will you ensure that the 2021 HUD budget request is
adequate to ensure all individuals and families currently
receiving assistance can continue to do so?
A.3. Yes. In each of the prior three fiscal years, the
Administration's Budget proposal has requested a funding level
for HUD that would allow the 9.5 million individuals and 4.6
million families currently receiving HUD rental assistance to
continue to do so.
Q.4. Will you ensure that the 2021 HUD budget request will help
address the waitlist backlog and ensure than hundreds of
thousands of eligible families can receive housing assistance?
A.4. Each year, HUD continues to spend more and more money to
house the same number of individuals and families. If
confirmed, I look forward to working with you and your staff on
ways to address these issues by identifying and removing
obstacles that impede access to, and production of, affordable
homes nationwide.
Q.5. What changes are you considering, if any, to the Housing
Trust Fund?
A.5. Only Congress can make changes to the Housing Trust Fund.
Q.6. How will HUD help low-income families with children who
cannot find an affordable home in a safe community with good
schools?
A.6. HUD has a number of rental assistance programs--like
Public Housing, Housing Choice Vouchers, Project-Based Rental
Assistance, and Tenant-Based Rental Assistance--as well as home
ownership programs supported by the Federal Housing
Administration to help low-income families with children who
cannot find an affordable home in a safe community with good
schools.
Q.7. What protections for manufactured housing home buyers will
you ensure remain in any changed housing finance policy?
A.7. See response to Question 8.
Q.8. What has FHA done to improve financing options for
manufactured housing buyers?
A.8. As part of its Housing Finance Reform plan, HUD is
considering innovative proposals to modify single-family
mortgage finance underwriting to further encourage additional
supply of entry-level housing, including manufactured housing.
To better support the manufactured housing industry, HUD
has proposed elevating the Office of Manufactured and
Innovative Housing Programs within HUD under the leadership of
a Deputy Assistant Secretary.
Q.9. In your current position, and if confirmed to Deputy
Secretary, what policies will you implement to increase
sustainable home ownership for African Americans and Latinos?
A.9. Under my leadership, HUD programs will continue to serve
all qualified homeowners. For FY2019, 36.24 percent of FHA
purchase originations served minority borrowers. Moreover,
while FHA makes up 19.8 percent of the overall mortgage market,
40.6 percent of all African American home buyers and 37.6
percent of all Hispanic home buyers who purchased a home during
CY2018 did so using an FHA-insured mortgage.
Q.10. The Administration's housing finance proposal restricts
FHA financing to primarily first-time home buyers. The
Administration recommends that ``Congress should establish FHA,
VA, and USDA as the sole source of low downpayment financing
for borrowers not served by the conventional mortgage market.''
Do you believe that Fannie Mae and Freddie Mac should not
provide support for responsible, sustainable low downpayment
mortgages originated by private sector lenders in the primary
market?
How would such a restriction affect the Latino and African
American families who rely on FHA to buy a home?
A.10. This question will be addressed by HUD in its responses
to your questions for the record from Secretary Carson's
hearing before the Senate Banking Committee on September 10,
2019.
Q.11. The Administration recommends legislative action to
create a multiguarantor model to replace Fannie Mae and Freddie
Mac without the housing goals or duty-to-serve requirements--
such as affordable housing preservation, rural housing and
manufactured housing--in the current charters.
What will HUD do to fill the gap if these housing goals and
duty-to-serve requirements are eliminated?
A.11. A central principle of the Administration's Housing
Finance Reform plan is that Federal mortgage credit policies
should be better coordinated in order to permit credit
qualified borrowers to access responsible and affordable
borrowing options. FHFA and FHA are coordinating to ensure the
GSEs and FHA serve defined roles within the marketplace with a
clear understanding of overlaps and gaps.
Q.12. The Administration suggests legislative action to
authorize Ginnie Mae to provide the full faith and credit
guarantee for Fannie, Freddie and possibly other credit
enhancing guarantors.
Can you please elaborate on what steps, roughly how much
funding would be necessary, and a timeline on which you think
Ginnie Mae could be made operational for this task?
A.12. This question will be addressed by HUD in its responses
to your questions for the record from Secretary Carson's
hearing before the Senate Banking Committee on September 10,
2019.
Q.13. What was your involvement with the proposed changes to
HUD's fair housing processes, including the recent disparate
impact rulemaking?
What do you say to fair housing advocates that feel the
five-part test will make it near impossible to bring fair
housing claims?
What do you say to fair housing lawyers who say that the
Supreme Court decision in Inclusive Communities required no
changes?
A.13. I would encourage fair housing advocates and other
stakeholders to read the Supreme Court's decision in Texas
Department of Housing and Community Affairs v. Inclusive
Communities Project, Inc. (2015). This case discussed the
standards for, and constitutional and necessary limitations on,
disparate impact claims.
The aim of HUD's proposed rule is not to abolish disparate
impact liability but to make it work better, help plaintiffs to
bring claims which are better supported, and help defendants to
resolve unsupported claims of discriminatory effect quicker.
This will lead to prompt resolution of disparate impact claims
for all parties, in accordance with Inclusive Communities.
Q.14. Why has HUD closed the Reno, NV Regional HUD Office?
What services and activities did the HUD field office
provide?
Where will those services be provided now?
How many HUD staff worked in this office at the start of
2016?
When did staff begin to get reassigned?
Where were they reassigned to?
What notice did HUD provide to legislators, grantees and
other stakeholders about the closure of the Reno HUD field
office?
A.14. HUD's Las Vegas field office is effectively and
efficiently providing coverage for the State of Nevada in the
same manner in which the Phoenix field office covers the entire
State of Arizona, the Albuquerque field office covers the
entire State of New Mexico, the Salt Lake City field office
covers the entire State of the Utah, and the Portland field
office covers the entire State of Oregon.
The Reno field office had three employees at the start of
2018. By March 2019, the Reno field office director had
accepted a position as the director of HUD's field office in
Portland, Oregon and a second employee retired. The last
remaining employee, a front desk receptionist, was without a
supervisor and was reassigned to the Los Angeles field office
in October. The Reno office is currently vacant and all
workload for Reno and Northern Nevada is being managed by our
Las Vegas field office.
HUD's Office of Field Policy and Management followed the
procedures of the Federal Property Management Reform Act of
2016 (40 U.S.C. 524), which requires executive departments and
agencies to assess leased space to identify space that is not
fully used or occupied, establish goals and policies that will
lead the agency to reduce excess property and underutilized
property, and to transfer and dispose of excess property as
promptly as possible. Closing the Reno field office eliminates
the cost of office space and administrative costs of $101,000
per year.
Our Las Vegas staff has met with the Reno Housing
Authority, Washoe Affordable Housing Corporation, the Reno
Police Department, and the Reno Area Alliance for the Homeless
to discuss providing coverage for our HUD customers and
grantees.
------
RESPONSES TO WRITTEN QUESTIONS OF SENATOR JONES
FROM BRIAN D. MONTGOMERY
Q.1. As you know, HUD Secretary Ben Carson announced a proposed
rule to rollback disparate impact discrimination lawsuits. In
your testimony you mentioned that the Supreme Court wanted
``safe guards'' to the disparate impact rule. Can you point to
the specific changes the Supreme Court asked for that are in
the ANPR? What changes, if any, would you make to the ANPR as
you become more involved in the process?
A.1. The Supreme Court in Texas Department of Housing and
Community Affairs v. Inclusive Communities Project, Inc.
(2015). discussed the standards for, and constitutional and
necessary limitations on, disparate impact claims. For example,
the Supreme Court noted that ``disparate impact liability must
be limited . . . [to help] sustain a vibrant and dynamic free-
enterprise system.''
The comment period for this proposed rule closed on October
18th, during which time HUD received a total of 45,757
comments. I believe HUD should consider these comments
seriously to make sure the disparate impact regulation is as
effective as possible. This will help plaintiffs bring better
supported claims and help defendants resolve unsupported claims
of discriminatory effect quicker.
Q.2. Community Development Block Grant (CDBG) is a 40-year-old
program that allocates billions of dollars in grants to State
and local governments for housing rehabilitation and economic
development. For the 3rd year in a row, HUD recommended to the
Senate Appropriations Committee to completely eliminate CDBG
funding. Were you involved in those conversations? What is the
reasoning for completely eliminating CDBG?
A.2. The budget process is an iterative one between Congress
and the Administration. Both the House and the Senate have
included over $3 billion for CDBG funding in their respective
THUD appropriations bills. I can commit to you that whatever
resources Congress sees fit to provide to HUD, we will utilize
those resources wisely and efficiently.
Q.3. Earlier this year the Senate Appropriations Committee
included report language in HUD's FY2021 appropriations bill
that `` . . . encourages HUD to require that mortgagees obtain
and provide to HUD the tax identification number of a
governmental entity when a governmental entity provides
downpayment assistance in the form of a gift or a second
mortgage.'' If this language is included in the final FY2021
HUD appropriations legislation, will you commit to not moving
forward on any administrative changes related to downpayment
assistance provided by governmental entities until HUD is able
to collect and analyze a statistically significant amount of
data on the performance of FHA loans with downpayment
assistance from a governmental entity?
A.3. As you may know, this is my second tenure serving as
Federal Housing Commissioner. Previously, when I served during
the Bush and Obama administrations, I was frustrated by FHA's
inability to prohibit a form of downpayment assistance (DPA),
commonly referred to as seller-funded, that ultimately led to
approximately $16.5 billion in losses to the Mutual Mortgage
Insurance Fund, according to FHA's independent actuarial
auditor. Our goal through our current rulemaking on DPA is to
give clarity on the Housing and Economic Recovery Act (HERA)
statutory prohibition on providers financially benefiting from
the assistance they provide. We also need to ensure that
providers are offering assistance that is in the best interest
of borrowers and FHA. As we move through the rulemaking
process, there will be an opportunity for public comment.
------
RESPONSES TO WRITTEN QUESTIONS OF SENATOR SINEMA
FROM BRIAN D. MONTGOMERY
Q.1. Modernizing the Federal Housing Administration's (FHA)
outdated IT systems is critical to improving lender
relationships and better servicing borrowers. Congress has
appropriated funding specifically for the Cybersecurity and
Information Technology Fund in the past. Can you describe some
of the improvements being made? As Deputy Secretary of HUD, how
would you direct any additional funding granted in an FY2020
appropriations bill towards modernization?
A.1. Congressional appropriations have jump started our plan to
modernize FHA's outdated technology. The systems that operate
FHA's loan insurance programs are, on average, 18 years old,
with some over 40 years old. Replacing outdated systems and
improving associated business processes will ensure that FHA
continues to perform its vital role in the mortgage market,
with greater ability to manage its risk at a lower cost and
increased efficiency. Some of the improvements include
enhancing the cybersecurity measures to protect data, capturing
and effectively analyzing extensive volumes of data,
implementing storage and processing capabilities to handle the
transition from paper to a digital environment, and managing
insured loans comprehensively across all phases of the mortgage
insurance life cycle. In addition, the modernization effort
would result in cost savings for taxpayers and lenders,
operational efficiencies, and improved end user experience.
The direction of additional funding would continue the
modernization of the Single Family forward mortgage program.
Together, FHA and the Office of the Chief Information Officer
are working diligently to bring this modernization effort to
reality and have identified key milestones in the FHA Single
Family IT Modernization Expenditure Plan. Please see the video
below on FHA's modernization project: https://www.linkedin.com/
posts/fed-housing-admin-today-hud-cio-david-chow-unveiled-a-
new-activity-6594680537078648833-L47r.
In addition, the functional components under development
can be leveraged for FHA's other lines of business. Loan
origination, endorsement, servicing, and claims are uniform
processes for each FHA single family home, multifamily
property, and healthcare facility. Once components are
completed, FHA would be able to leverage the Single Family
Forward baseline functionality to jump start modernization
efforts for Multifamily, Healthcare, HECM, and Housing
Counseling programs in future phases.
------
RESPONSES TO WRITTEN QUESTIONS OF SENATOR REED
FROM DAVID C. WOLL, JR.
Q.1. This year, President Trump proposed cutting $12 billion in
affordable housing and economic development programs. This
included requesting no money at all for HOME and the Community
Development Block Grant Program.
Do you support these proposed cuts?
If not, what will you do to advocate for HOME and the
Community Development Block Grant before the President submits
his budget request for Fiscal Year 2021?
A.1. The budget process is an iterative one between Congress
and the Administration. Both the House and the Senate have
included funding for CDBG and HOME in their respective THUD
appropriations bills. I can commit to you that whatever
resources Congress sees fit to provide to HUD, we will utilize
those resources wisely and efficiently.
Q.2. Nearly 2 years ago, Congress provided HUD with roughly $16
billion in Community Development Block Grants for Disaster
Recovery (CDBG-DR) in order to help areas that were devastated
by disasters between 2015 and 2017 to rebuild and mitigate
against future disasters. For more than a year, HUD stalled in
issuing the Federal Register notices that the affected areas
need in order to begin planning for the use of their CDBG-DR
funds. As result, Congress included a provision in Public Law
116-20 that required HUD to issue the notices by September 4,
2019.
HUD complied with this requirement for every community--
except one--Puerto Rico. We are nearly 80 days past the
statutory deadline. As ranking member of the Transportation-HUD
Appropriations Subcommittee, my staff and I have submitted
numerous inquiries to the Department to get the legal
justification for withholding the Notice for Puerto Rico. HUD
has not provided an answer.
In your role as Principal Deputy Assistant Secretary, you
have been responsible for the oversight of HUD's disaster
recovery program, including the issuance of Puerto Rico's
mitigation Notice, since November of 2018.
What is the legal justification for HUD withholding the
notice for Puerto Rico, as required by PL 116-20?
A.2. HUD is legally required to assess the risk of each of its
grantees and to formulate measures to mitigate that risk. OIRA
has also advised HUD that the mitigation notice and DR grant
agreements are subject to review by it under Executive Order
12866 as significant regulatory actions.
Q.3. When will HUD to publish the notice for Puerto Rico and to
finalize the grant agreement for the base CDBG-DR allocation?
A.3. HUD is working with its Federal partners to finalize the
grant conditions that will govern the Commonwealth's second
allocation of CDBG-DR funds. Once those conditions are in
place, HUD will be positioned to move forward with Puerto
Rico's mitigation funding.
------
RESPONSES TO WRITTEN QUESTIONS OF SENATOR WARREN
FROM DAVID C. WOLL, JR.
Q.1. At the nomination hearing you said one of your priorities
was to ``strengthen the stewardship of the Disaster Recovery
program.''
Budgets reflect institutional values, and the HUD FY2020
budget request includes no funding for Community Development
Block Grant Disaster Assistance. What commitment is there among
HUD leadership to strengthen the CDBG-DR program? If confirmed
as Assistant Secretary of the Office of Community Planning and
Development, what are your specific plans to strengthen this
program?
A.1. Standardizing CDBG-DR requirements across the various
CDBG-DR appropriations is one key component of moving CDBG-DR
funds more rapidly to our grantees. Closer, ongoing
coordination with the Federal Emergency Management Agency and
the Small Business Administration, both before and after a
disaster is also a priority. We will also continue to
strengthen our oversight and accountability efforts with
grantees, including implementing many of the recommendations
from recent GAO reports.
Q.2. You stated you are ``in the process of doubling the size
of the disaster recovery division, and out-stationing staff
closer to [HUD] grantees.'' Please provide additional
information about how HUD is expanding this division, including
information about any new staffing roles and division areas.
A.2. In FY2018, the Disaster Recovery and Special Issues
Division was comprised of 22 staff. Over the course of FY2019
and 2020 we have added an additional 25 staff, more than
doubling the division's staffing capacity. HUD has also out-
stationed an increasing portion of the staff from HUD
headquarters to our field offices, building regional grants
management teams in New York, Atlanta, Forth Worth, and San
Francisco, to give our grantees better and more efficient
access to HUD resources and expertise.
Q.3. At the nomination hearing you stated: ``we are not going
to permit discrimination against transgender individuals'' and
``we intend to completely enforce the 2012 restriction against
any discrimination against anybody based on sexual orientation
or gender identity.''
Do you intend to completely enforce the 2016 Equal Access
Rule?
What role did you have in developing the 2019 proposed rule
(RIN 2506-AC53) which would allow for legalized discrimination
based on gender identity at HUD-funded shelters?
What was the clearance process for this proposed rule?
Please provide a list of the titles of all career HUD employees
and names and titles of all appointed HUD employees involved
and their role in developing and approving this proposed rule.
Were you part of the clearance process? Please provide all
emails from November 1, 2018, to May 22, 2019, in which you
send, receive, or are copied on discussion of the proposed
rule.
Who at HUD was primarily responsible for drafting the
proposed rule?
Did you provide performance reviews to any of individuals
referenced in question 2(a)? Did your performance reviews
include discussion of their work on the proposed rule?
Are there any aspects of the proposed rule that you
disagree with or would like to be strengthened?
Do you agree that the 2019 proposed rule would allow for
discrimination based on gender identity at HUD-funded shelters?
If you are not going to permit discrimination against
transgender individuals, will you commit to not proceeding with
the rulemaking process on RIN 2506-AC53?
A.3. HUD does not have a proposed rule that would ``allow for
legalized discrimination.'' HUD has a draft rule that is
currently under review by the Office of Management and Budget.
It has not been proposed and therefore has not been sent to
Congress for review. While I am limited in what I can say about
a rule that is still under review, I can unequivocally assure
you it would not permit discrimination in any manner. The other
portions of your questions seek information about HUD's
deliberative process or personnel matters.
Q.4. In May 2019, Secretary Carson told a Congressional
committee he was ``not currently anticipating changing'' the
Equal Access Rule. A day later HUD proposed the 2019 rule that
would change the Equal Access Rule to allow discrimination
against transgender individuals in HUD-funded shelters. This
troubling reversal suggests a need to request more specific
commitments from nominees.
If confirmed, will you commit to enforcing existing
restrictions on ``any discrimination against anybody based on
sexual orientation or gender identity'' throughout your tenure
as Assistant Secretary for Community Planning and Development?
A.4. Yes.
Q.5. If confirmed, will you commit to require HUD-subsidized
shelters to allow individuals to use shelters services that are
consistent with their gender throughout your tenure as
Assistant Secretary for Community Planning and Development?
A.5. If confirmed, I commit to requiring HUD-subsidized
shelters to allow individuals to use shelter services that are
consistent with their gender, where required by law, throughout
my tenure as Assistant Secretary for Community Planning and
Development.
Q.6. How do you plan to consult with external advocates and
experts, including organizations led by transgender
individuals, on future HUD policies to ensure they will not
have a discriminatory impact on transgender individuals?
A.6. If approved by OMB, this proposed rule will be open for 60
days during which time all external advocates and experts will
be free to comment on all aspects of the proposal. I look
forward to reviewing and fully considering all such comments.
------
RESPONSES TO WRITTEN QUESTIONS OF
SENATOR CORTEZ MASTO FROM DAVID C. WOLL, JR.
Q.1. If confirmed, what steps do you plan to take to ensure
Puerto Rico is receiving hurricane relief funding in a timely
manner?
A.1. Currently, Puerto Rico has in place sufficient funding to
address its unmet need. Specifically, the Commonwealth has
access to approximately $1.5 billion in disaster recovery
funds, of which it has spent less than 1 percent to date. If
confirmed, I commit to continuing HUD's ongoing efforts to make
additional funds available to Puerto Rico.
Q.2. What policies or programs do you plan to implement to
ensure Puerto Rico is able to rebuild and stay resilient
against future disasters?
A.2. Long-term recovery and enhancing the resiliency of Puerto
Rico is already underway. HUD is committed to ensuring that
Puerto Rico's infrastructure investments are designed to better
withstand future impacts. HUD will also continue to encourage
buyouts that move individuals to safer locations.
Q.3. Please explain how HUD will mitigate the affordable
housing crisis?
A.3. See below.
Q.4. Where do you think we have an affordable housing crisis?
Who is affected by the crisis?
A.4. In addition to HUD's existing programs that provide
affordable housing--such as the Federal Housing Administration,
public housing, Housing Choice Vouchers, and housing for the
elderly and disabled--Secretary Carson is honored to serve as
the Chair of the White House Council on Eliminating Regulatory
Barriers to Affordable Housing. The Council is engaging with
Governments at all levels and other private-sector stakeholders
to identify and remove obstacles that raise the costs of
affordable housing development and contribute to shortages in
America's housing supply.
Q.5. Will you ensure that the 2021 HUD budget request is
adequate to ensure all individuals and families currently
receiving assistance can continue to do so?
A.5. Yes. In each of the prior three fiscal years, the
Administration's Budget proposal has requested a funding level
for HUD that would allow all individuals and families currently
receiving HUD assistance to continue to do so. If confirmed, I
commit to you that whatever resources Congress sees fit to
provide to HUD, I will utilize those resources wisely and
efficiently to help those most in need.
Q.6. Will you ensure that the 2021 HUD budget request will help
address the waitlist backlog and ensure than hundreds of
thousands of eligible families can receive housing assistance?
A.6. Each year, HUD continues to spend more and more money to
house the same number of individuals and families. If
confirmed, I look forward to working with you and your staff on
ways to address these issues by identifying and removing
obstacles that impede access to, and production of, affordable
homes nationwide among all Americans.
Q.7. What changes are you considering, if any, to the Housing
Trust Fund?
A.7. Only Congress can make changes to the Housing Trust Fund.
Q.8. How will HUD help low-income families with children who
cannot find an affordable home in a safe community with good
schools?
A.8. HUD has a number of rental assistance programs--like
Public Housing, Housing Choice Vouchers, Project-Based Rental
Assistance, and Tenant-Based Rental Assistance--as well as home
ownership programs supported by the Federal Housing
Administration to help low-income families with children who
cannot find an affordable home in a safe community with good
schools.
Q.9. How will you protect transgender individuals' access to
emergency shelters and housing assistance programs that ensures
their dignity and respect?
A.9. I am committed to ensuring that all persons seeking access
to HUD's programs may do so without discrimination. HUD's 2012
equal access rule prohibits discrimination against sexual
orientation and gender identity. Shelter providers must
establish policies that are consistent with all Federal, State,
and local laws that ensure nondiscriminatory practices.
------
RESPONSES TO WRITTEN QUESTIONS OF SENATOR JONES
FROM DAVID C. WOLL, JR.
Q.1. As you know, HUD offices monitor how grantees use Federal
funds. Sometimes these monitors can result in the HUD office
requesting funds to be returned. Organizations can appeal this
decision. As Assistant Secretary of Community Planning and
Development these complaints can come to your office. Do you
believe that organizations, particularly nonprofit
organizations, should return funds over local administrative
differences?
A.1. HUD has a fiduciary obligation to protect taxpayers and
ensure responsible administration of its grants. In cases of
alleged or apparent misuse of funds, HUD will thoroughly
investigate the matter and take appropriate action based on the
specific circumstances and facts. As you noted, there is also
an appeal process that provides organizations with an
opportunity to present any additional facts before a final
determination is made. If confirmed, I will commit to
considering all relevant information presented by grantees
before any final determinations are made concerning the return
of funds.
Q.2. I am happy to hear the work the Office of Community
Planning and Development is doing to effectively respond to
disasters around the country. In Alabama, we were hit with
tornadoes in Lee County and were fearful of hurricanes hitting
soon after as well. What plans do you have in place for areas
that face repeated natural disasters in a short period of time.
A.2. HUD has supported several recent efforts to address the
needs of areas that face repeated disasters over a short period
of time, including allowing grantees impacted by Hurricanes
Matthew and Florence to interchangeably use CDBG-DR funds
received for these respective disasters. HUD has also
implemented a new requirement that allows certain grantees to
use their CDBG-DR administrative funds interchangeably for
recovery from multiple disasters. HUD's recently published
mitigation notices direct grantees to fund mitigation
activities within the framework of FEMA-identified community
``lifelines,'' or those infrastructure and other sectors that
must continue to operate following a disaster in order for
long-term recovery to commence.
------
RESPONSES TO WRITTEN QUESTIONS OF SENATOR BROWN
FROM JOHN BOBBITT
Q.1. A recent IG report stated that HUD lost 18.5 percent of
its staff over the last decade, more than any other cabinet-
level agency, and that this reduction in staff affected all
many, if not all, of HUD's top management challenges.
If confirmed, what are the first steps you will take to
address understaffing?
A.1. HUD is making great strides in improving our hiring:
In FY17, time to hire was 163 days and HUD lost 726
employees.
In FY18, time to hire improved to 113 days and HUD
lost 595 employees.
In FY19, time to hire dropped to 102 days
(factoring out the lapse in appropriations) and HUD
added a net gain of 17 employees overall.
In addition, HUD hired more than 1,000 employees for the
first time in nearly a decade. We are trending in the right
direction. If confirmed, I will work to improve this record by
utilizing Business Process Reengineering (BPR) to identify
problems and reduce time and steps in the process.
Additionally, the BPR process will be used to evaluate our
current shared services provider verses finding a better
performing vendor or moving this process back internally.
Service Level Agreements (SLA) will also be evaluated as well
as hiring policies that cause delays in hiring. Finally, hiring
managers will be held accountable for moving the process along
efficiently.
Q.2. How will you prioritize addressing staffing shortages in
HUD's many offices?
A.2. Prioritization will be based on shortages to mission
critical functions such as program offices that oversee rental
assistance, disaster recovery, and homelessness programs.
Q.3. As Assistant Secretary for Administration, would you
recommend that HUD hire or promote an individual if a Federal
Inspector General's report had previously found that that
individual may have abused their authority, may have misused
their position for private gain, and had created an appearance
of a violation of the Standards of Ethical Conduct for
Employees of the Executive Branch?
A.3. If confirmed as the Assistant Secretary for
Administration, it would not be my role to recommend hiring or
not hiring for most positions.
------
RESPONSES TO WRITTEN QUESTIONS OF SENATOR REED
FROM JOHN BOBBITT
Q.1. This year, President Trump proposed cutting $12 billion in
affordable housing and economic development programs. This
included requesting no money at all for HOME and the Community
Development Block Grant Program.
Do you support these proposed cuts?
If not, what will you do to advocate for HOME and the
Community Development Block Grant before the President submits
his budget request for Fiscal Year 2021?
A.1. I have no position on this matter. My expertise is in
operations, not policy, and the position for which I am
nominated has no bearing or influence on budget issues.
------
RESPONSES TO WRITTEN QUESTIONS OF SENATOR WARREN
FROM JOHN BOBBITT
Q.1. The HUD Inspector General October 2018 Top Management
Challenges report found, ``Constant turnover and extended
vacancies in many of HUD's most important political and career
executive positions have created leadership gaps, which have
led to poor management decisions and questionable execution of
internal business functions.'' In your written testimony you
stated you will decrease the time it takes to hire at HUD and
reduce the risks associated with critical vacancies.
How are you planning to reduce the time it takes to hire at
HUD?
A.1. HUD is making great strides in improving our hiring:
In FY17, time to hire was 163 days and HUD lost 726
employees.
In FY18, time to hire improved to 113 days and HUD
lost 595 employees.
In FY19, time to hire dropped to 102 days
(factoring out the lapse in appropriations) and HUD
added a net gain of 17 employees overall.
In addition, HUD hired more than 1,000 employees for the
first time in nearly a decade. We are trending in the right
direction. If confirmed, I will work to improve this record by
utilizing Business Process Reengineering (BPR) to identify
problems and reduce time and steps in the process.
Additionally, the BPR process will be used to evaluate our
current shared services provider verses finding a better
performing vendor or moving this process back internally.
Service Level Agreements (SLA) will also be evaluated as well
as hiring policies that cause delays in hiring. Finally, hiring
managers will be held accountable for moving the process along
efficiently.
Q.2. What current vacancies do you consider particularly
critical?
A.2. Deputy Secretary, Assistant Secretary for the Office of
Community Planning and Development, President of the Government
National Mortgage Association, and Assistant Secretary for the
Office of Administration.
Q.3. What do you consider the risks associated with critical
vacancies?
A.3. Senior-level vacancies create a leadership void that can
lead to lower morale and contribute to a lack of clear vision
of HUD's mission. Vacancies at the mid to lower level of
employees can affect our ability to deliver services to the
people HUD serves.
Q.4. How do you plan to reduce those risks, and, if not by
filling the vacancies, what analysis are you relying on to
justify any measures other than filling existing vacancies?
A.4. There is only one long-term answer: fill the positions.
The culture of an organization can carry it over rough times
but not indefinitely. Analysis is not a substitute for action
and leadership.
Q.5. What are your plans to expeditiously fill extended
vacancies?
A.5. Please see response to Answer 1 above.
Q.6. What is your analysis for why there is constant turnover
at HUD, and how do you plan to address this?
A.6. Turnover in any organization can generally be attributed
to morale. Morale can be affected by vacant leadership
positions. If confirmed, I will foster a positive culture that
recognizes employees, practices respect for the individual,
empowers them, and provides the training and tools necessary
for career development. I have implemented a new culture in
Housing Operations that includes an open-door policy, core
values, empowerment at every level of the organization and a
new employee training and development program.
Q.7. The Federal Employee Viewpoint Scorecard measures employee
perceptions of their agencies. In the 2018 scorecard:
Less than half of HUD employees reported agreeing or
strongly agreeing that they have sufficient resources to get
their jobs done. Why do you think that perception exists, and
how will you address it?
A.7. It can be attributed to employees not having the resources
they need to perform their work. This will require a deeper
analysis by program area to find out specifically what
resources are lacking.
Q.8. Less than half of HUD employees reported agreeing or
strongly agreeing that their work unit is able to recruit
people with the right skills. Why do you think that perception
exists, and how will you address it?
A.8. As discussed previously, the hiring process requires
attention to shorten the process and ensure we are hiring
qualified personnel.
Q.9. Only around half--51.1 percent--of HUD employees reported
agreeing or strongly agreeing that arbitrary action, personal
favoritism, and coercion for partisan political purposes are
not tolerated. Why do you think that percentage isn't higher,
and how will you address it?
A.9. I will address this by having an open-door policy to allow
employees to talk privately to all levels of management as well
as quarterly recognition and communication meetings.
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RESPONSES TO WRITTEN QUESTIONS OF SENATOR BROWN
FROM PETER J. CONIGLIO
Q.1. Fraud Prevention and Reporting--If confirmed, how will you
promote fraud prevention efforts at the Bank?
A.1. If confirmed, I would restore a sense of regular order to
the Office of Inspector General. I would also let it be known
that the Ex-Im OIG has an ``open-door'' policy for those who
believe that they have information on possible wrongdoing at
Ex-Im, especially related to potentially fraudulent activities;
that they will be respected; and that they will be taken
seriously and afforded every protection under the law. My
ultimate objective would be to inform all of Ex-Im's employees,
regardless of their division, that the door of Ex-Im's Office
of Inspector General is open to them.
I would also like to review three areas highlighted in the
OIG's last two Semi-Annual Reports to Congress: (a) the ``Fraud
Awareness Training and Outreach'' program; (b) the review of
Ex-Im's compliance with the challenges of Enterprise Risk
Management and internal agency controls; and (c) the Suspension
and Debarment Initiative. I know that there is always room for
improvement, and I would like to determine if any of these need
to be made more robust. For example, in conjunction with the
Office of Inspector General's Whistleblower Coordinator, adding
an ``Outreach to Whistleblowers'' training segment to the Fraud
Awareness Training program if such a training segment does not
currently exist. Through my review of these three programs,
particularly regarding fraud awareness outreach, I will
establish a baseline understanding of what needs to be done to
further educate about fraud prevention efforts.
Q.2. The Ex-Im Inspector General's office was established 12
years ago. During that time, there has been a single case of
fraud related to the Bank's credit assistance that involved a
Bank employee, but some interest groups have falsely cited the
number of investigation opened by OIG as evidence of fraudulent
activity within the Ex-Im Bank's credit programs. Former Acting
Inspector General Terry Settle in a letter to the Committee's
leadership on October 31, 2017, correctly pointed out that
``not all claims included in a case under investigation are
necessarily fraudulent until proven to be so by evidence
developed in the investigation.''
In semi-annual reports, other reporting, testimony or
public statements, will Ex-Im's Office of the Inspector General
(OIG) under your leadership:
Clearly identify any instances of fraud or misconduct by a
Bank employee that are related to Ex-Im's credit assistance,
A.2. If confirmed, and knowing that every situation is
different, I would consult with Ex-Im OIG Counsel and the OIG's
professional staff concerning what information on closed
investigations can be made public, including instances of fraud
or misconduct proven to be committed by an Ex-Im employee. The
public release of information related to open investigations is
limited by privacy and confidentiality restrictions.
Q.3. provide clarity that the referral of a claim to the OIG or
the opening of the investigation by the OIG does not establish
the existence of fraud?
A.3. If confirmed, and knowing that every situation is
different, I would consult with Ex-Im OIG Counsel and the OIG's
professional staff concerning what information can be made
public. I do believe it is important to clarify that the
existence of an investigation does not affirm the presence of
improper activity or illegality and I would do my best to share
that.
Q.4. Environmental and Social Due Diligence--In 2015, the Ex-Im
OIG issued a report that documented shortcomings in the Bank's
monitoring of the environmental and social performance of a
project. That report's recommendation resulted in Ex-Im
creating a formal mechanism to resolve complaints by parties
who report they are adversely affected by Bank-funded projects.
If confirmed, will you continue to monitor Ex-Im's
adherence to required environmental and social due diligence
procedures?
A.4. If confirmed, I can commit that the Ex-Im OIG will be
vigilant in its review and monitoring of Ex-Im's adherence to
its mission, as outlined in the law. I understand that the Ex-
Im OIG has previously conducted reviews of Ex-Im-financed
projects and assessments of how Ex-Im has implemented its
environmental and social due diligence procedures in those
projects.
As I assess the priorities of the OIG, I would be pleased
to work with your office to better understand any specific
concerns you may have regarding Ex-Im's environmental and
social due diligence procedures. In the case where the OIG is
informed about a complaint relating to Ex-Im's implementation
of its environmental and social procedures and guidelines, I
would take the complaint seriously and follow the facts
wherever they may lead.
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RESPONSES TO WRITTEN QUESTIONS OF SENATOR WARREN
FROM PETER J. CONIGLIO
Q.1. Please describe how your experience working in the Office
of Inspector General (OIG) for the General Services
Administration (GSA) has informed your views on the roles of
IGs and the importance of IG independence.
A.1. Since June 2006, I have served in the Office of Inspector
General (OIG) at the General Services Administration (GSA)
working for three Inspectors General (IGs)--one appointed by
President George W. Bush--one appointed by President Barack
Obama--and our Deputy IG, who served as our Acting IG. All
three made positive contributions to the GSA OIG and I have
learned from all of them. They have made me keenly aware of the
key role an Office of Inspector General plays in an agency's
success. In addition, they set the bar high in modeling IGs who
defend an OIG's independence.
My service in several different senior positions with the
GSA OIG also has provided me a tutorial on how to be an
effective Inspector General.
In addition to my present position as the Special Assistant
and Counselor to the Assistant Inspector General for Auditing,
for almost 4 years, I headed the OIG's compliance office that
reported directly to the GSA Inspector General. The office
reviewed the OIG's internal audit and investigative operations,
including site visits to regional OIG offices. Our objective
was to ascertain whether an OIG office complied with the
standards established for the audit and investigative
disciplines. The internal review of OIG functions affected how
our offices would conduct themselves in accordance with the
mandates of the Inspector General Act, as amended, along with
other relevant statutes.
From that position, I stood up the OIG's first-ever audit
report writing and editing team. As lead editor, I oversaw the
production of the OIG's Office of Audits' audit reports, which
are an OIG's first-line of communication with its agency. Our
objective was to produce a readable--written in plain
language--objective, usable audit report. It is important that
agency leaders have understandable recommendations that they
can, in turn, use to improve its operations and programs. Our
team was rewarded for our efforts with an Inspector General's
award.
Q.2. If you are confirmed, will you commit to maintaining such
independence at the Export-Import (Ex-Im) Bank?
A.2. If confirmed, I am committed to an Ex-Im OIG that will
adhere to the mandates of the Inspector General Act, as
amended, along with any other relevant statutes, including
vigorously defending the independence and objectivity of the
Ex-Im OIG.
Q.3. Do you support the mission of and commit to ensuring that
the Ex-Im Bank operates at full capacity?
A.3. If confirmed, I would not bring any preconceived bias or
animus to my position as Inspector General of Ex-Im. IGs were
not established to ``run'' agencies. IGs were established to be
an asset to an agency's leadership by working to identify and
address fraud, waste, and abuse; to help an agency fulfill its
mission--whatever that mission may be--and to be successful in
doing so. An OIG is not an agency's enemy or adversary.
Q.4. Describe the role of the IG in enforcing the Ex-Im Bank's
environmental and social due diligence procedures.
A.4. If confirmed, I will ensure the Ex-Im OIG will continue to
review and monitor Ex-Im for its adherence to its mission as
established by the law, with the primary goal of rooting out
fraud, waste, and abuse in accord with the Inspector General
Act, as amended. Based on any findings during a review, audit,
or investigation, the Ex-Im OIG would then make specific
recommendations in its reports to Ex-Im that would be intended
to improve Ex-Im operations or programs. In the case where the
OIG is informed about a complaint relating to Ex-Im's
implementation of its environmental and social procedures and
guidelines, I would take the complaint seriously and follow the
facts wherever they may lead.
Q.5. Do you commit to conducting rigorous oversight to ensure
that the environmental, social, and project-related costs of
transactions are adequately assessed before Ex-Im enters into a
transaction?
A.5. As I assess the priorities of the OIG, I would be pleased
to work with your office to better understand any specific
concerns you may have regarding Ex-Im's environmental and
social due diligence procedures. In the case where the OIG is
informed about a complaint that Ex-Im has not properly assessed
the costs of potential transactions, I would take the complaint
seriously and follow the facts wherever they may lead.
Q.6. Do you commit to ensuring that all Environmental and
Social Impact Assessments are made available to the public in a
timely manner?
A.6. As I assess the priorities of the OIG, I would be pleased
to work with your office to better understand any specific
concerns you may have regarding the public availability of
Environmental and Social Impact Assessments. In the case where
the OIG is informed that Ex-Im is not acting in accordance with
applicable statutory mandates or its environmental and social
procedures and guidelines, I would take the complaint seriously
and follow the facts wherever they may lead.
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RESPONSES TO WRITTEN QUESTIONS OF
SENATOR CORTEZ MASTO FROM PETER J. CONIGLIO
Q.1. Can you discuss the ombudsman process where possible
problems with environmental or other issues with investments
could be discussed? Where would the Inspector General get
involved in potential complaints?
A.1. If confirmed, I will ensure that the Ex-Im OIG will
continue to review and monitor Ex-Im for its adherence to its
mission as established by the law, with the primary goal of
rooting out fraud, waste, and abuse. Based on any findings
during a review, audit, or investigation, the Ex-Im OIG would
then make specific recommendations in its reports to Ex-Im with
a goal of improving Ex-Im operations or programs. In a case
where the OIG is informed about a complaint relating to Ex-Im's
implementation of its environmental and social procedures and
guidelines, I would take the complaint seriously and follow the
facts wherever they may lead.
Q.2. Some have recommended prohibiting Export-Import Bank
financing for any U.S. firm selling to a company owned by the
Chinese Government. What role do you see the OIG's involvement
in discussing the impact of such a prohibition be on U.S.
companies and on China?
A.2. If confirmed, the Ex-Im OIG will adhere to its mandate as
outlined in the Inspector General Act, as amended, along with
any relevant guidance provided by the Council of Inspectors
General on Integrity and Efficiency.
Ex-Im OIG must defer to Congress and the Administration to
resolve any policy issue, such as the potential prohibition on
certain types of financing described above. As I understand the
mission of the OIG, it would generally be beyond the scope of
its statutory responsibilities to evaluate the potential
ramifications of implementing such a prohibition. If Congress
passed a statutory mandate, and I was aware of concerns about
Ex-Im's compliance with the mandate, I would take the concerns
seriously and follow the facts wherever they may lead.
Q.3. Seventy-five environmental activists sent a letter
recommending that the Ex-Im Bank should fully comply with the
requirements of the Endangered Species Act (ESA). Scientists
say that one million species around the world face extinction
in the coming decades due to climate change and other human
activities. How will the OIG consider sharing information about
the impact of the Export-Import Bank's funding of projects that
could hasten the extinction of the 650 endangered and
threatened foreign plants and wildlife?
A.3. If confirmed, I will ensure that the Ex-Im OIG will
continue to review and monitor Ex-Im for its adherence to the
law, with the primary goal of rooting out fraud, waste, and
abuse in accordance with the Inspector General Act, as amended.
In a case where the OIG is informed about a complaint relating
to Ex-Im's implementation of its environmental and social
procedures and guidelines, I would take the complaint seriously
and follow the facts wherever they may lead.
Q.4. Despite the mandate to devote at least 10 percent of Ex-
Im's aggregate financing to renewable energy exports, the Bank
has consistently fallen short of this target. Will the OIG
report on the Bank's goals to meet this target? Will the OIG
recommend ways that the Bank can meet this target?
A.4. If confirmed, I will ensure that the Ex-Im OIG will
continue to review and monitor Ex-Im for its adherence to the
law, with the primary goal of rooting out fraud, waste, and
abuse. Based on any findings during a review, audit, or
investigation, the Ex-Im OIG would then make specific
recommendations in its reports to Ex-Im with a goal of
improving Ex-Im operations or programs. In a case where the OIG
is informed about a failure by Ex-Im to comply with its
statutory mandates, I would take the complaint seriously and
follow the facts wherever they may lead. When the OIG
undertakes such a review, I think it is critical that it
provide recommendations that are usable and productive for the
agency.
Q.5. The Export-Import Bank requires projects have an
independent contractor monitor the development during and after
construction. The Ex-Im Bank also operates an online portal for
complaints. Some advocates say that the online portal lacks an
independent accountability mechanisms. They say it does not
have a dispute resolution function that brings the parties
together to find a mutually agreeable solution to the
community's grievances.
Do you think a more effective complaints mechanism is
needed? If so, what would it entail?
A.5. While I am aware of this particular method for filing
complaints, as I am not currently with Ex-Im OIG, I do not have
a detailed knowledge of the operation of this particular tool.
If I am confirmed, I would be pleased to meet with you or your
staff to discuss your concerns about this matter.
Q.6. What role could you add to the Bank's complaint mechanism
for the Office of Inspector General?
A.6. While I am aware of this particular method for filing
complaints, as I am not currently with Ex-Im OIG, I do not have
a detailed knowledge of the operation of this particular tool.
If I am confirmed, I would be pleased to meet with you or your
staff to discuss your concerns about this matter.
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RESPONSES TO WRITTEN QUESTIONS OF SENATOR SINEMA
FROM PETER J. CONIGLIO
Q.1. Ex-Im is critical to Arizona's economy and U.S. global
competitiveness, which means we need it running as effectively
and efficiently as possible. As Inspector General, how do you
plan to improve management and accountability at the Bank?
A.1. If confirmed, I am committed to ensuring that the Ex-Im
OIG will be fully functioning, objective, and independent. The
Ex-Im OIG will review and monitor Ex-Im for its adherence to
the law, with the primary goal of rooting out fraud, waste, and
abuse. Based on any findings during a review, audit, or
investigation, the Ex-Im OIG would then make specific
recommendations in its reports to Ex-Im that would be intended
to improve Ex-Im operations or programs.
Additional Material Supplied for the Record
LETTER SUBMITTED BY THE MORTGAGE BANKERS ASSOCIATION IN SUPPORT OF
BRIAN D. MONTGOMERY
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LETTER SUBMITTED BY THE NATIONAL ASSOCIATION OF REALTORS IN SUPPORT OF
BRIAN D. MONTGOMERY
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