[Congressional Record Volume 140, Number 94 (Tuesday, July 19, 1994)]
[Senate]
[Page S]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: July 19, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
  DISREGARDING OF CERTAIN PAYMENTS MADE TO VICTIMS OF NAZI PERSECUTION

  Mr. FORD. Now, Mr. President, I ask unanimous consent that the Senate 
proceed to the immediate consideration of H.R. 1873, a bill to require 
certain payments made to victims of Nazi persecution to be disregarded 
in determining eligibility for and the amount of benefits or services 
based on need just received from the House; that the bill be deemed 
read three times, passed, and the motion to reconsider laid upon the 
table; that any statements relating to this matter appear in the Record 
at the appropriate place.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DeCONCINI. Mr. President, I rise in support of legislation passed 
Wednesday, July 13, in the House of Representatives to protect the 
rights of Holocaust survivors to receive foreign government restitution 
payments and the full benefits for all needs-based programs provided by 
our Government. Congressman Waxman's bill, H.R. 1873, as amended by the 
Government Operations Committee, is substantially the same legislation 
as I introduced last year at the same time as my friend from 
California.
  This bill will prevent all Government agencies from considering 
restitution payments to Holocaust survivors by the Federal Republic of 
Germany as income, thereby allowing survivors to receive the 
restitution without any reduction in the need-based Government services 
that they are entitled to receive.
  This issue recently came to national prominence when I received a 
letter from Fanny Schlomowitz, an 83-year-old woman who receives low-
income rent assistance from the Department of Housing and Urban 
Development. Fanny is a survivor of a Budapest Jewish ghetto. As a 
young pregnant woman living there, Fanny was kicked in the head and 
beaten on several occasions by S.S. Stormtroopers. Many of those blows 
she still feels today.
  Her only income other than the Holocaust restitution is a monthly 
$370 Social Security check. Fanny has high medical and prescription 
drug expenses. Fanny also pays $816 every 3 months for her regular 
medical insurance plan, and an additional plan to assure nursing home 
care if she needs it, so that she would not have to go to a taxpayer-
supported facility. She pays $63 a month for her small HUD-subsidized 
apartment. Though nothing can ever make up for the unspeakable acts 
committed during that time, the Federal Republic of Germany sends her a 
monthly check as a small token of the remorse felt by the German people 
for her suffering.
  Fanny contacted me when she learned that HUD had decided to consider 
these restitution payments as annual income and quadruple her rent. 
Even though these payments are not counted as taxable income by the 
Internal Revenue Service, HUD felt that the statutes governing low-
income housing assistance required the Department to include these 
payments as income for purposes of computing her rent assistance. As a 
consequence, the rent for her tiny apartment was to go up by $164 per 
month. In desperation, she asked me to help prevent this injustice.
  I contacted Secretary of Housing and Urban Development Henry Cisneros 
to express my dismay at HUD's decision and to request that the action 
be reversed. Secretary Cisneros immediately called for a review of the 
matter and within a month's time, the Department proposed a rule 
providing prospective relief from the long-standing policy. I am indeed 
very appreciative of the Secretary's prompt attention to the problem. 
His action has probably prevented any future harm to Holocaust victims 
eligible for HUD needs-based assistance.
  However, Mr. President, as I have advised the Secretary, no legal 
authority exists for HUD or any other domestic agency action in this 
area. The Holocaust restitution payments, not reparation payments as 
referred to in the proposed HUD final rule, are governed by 
international law. Therefore, no domestic agency has any authority to 
make any pronouncement, pro or con, as to the legal status of these 
payments. Only the President, with adverse and consent of the Congress, 
has that authority. Moreover, the legal status of these restitution 
payments is governed by a 1954 international bilateral protocol.
  In 1984, the Ninth Circuit Court of Appeals in Grunfeder v. Heckler, 
748 F. 2d 503 (1984) reaffirmed this basic constitutional principle. In 
that case, former Health and Human Services [HHS] Secretary Margaret 
Heckler was sued by a Holocaust survivor because the Social Security 
Administration had included these payments as income for eligibility 
purposes. The Court held that payment received pursuant to the Federal 
Republic of Germany Compensation of Victims of National Socialist 
Persecution statute does not constitute income for purposes of 
determining eligibility for supplemental security income [SSI] despite 
the express absence of an exclusion in the statute. The Ninth Circuit 
specifically found that HHS Secretary Heckler's interpretation of the 
German Restitution Act is entitled to little deference as the Court is 
bound to construe the domestic legislation in a way that minimizes 
interference with the purpose or effect of foreign law.

       This case requires us to resolve a conflict between 
     Government's interest in allocating a limited pool of funds 
     to support the country's aged, blind, and disabled against 
     our Government's interest in restoring a semblance of normal 
     existence to Holocaust survivors who are part of our society. 
     In resolving the matter in favor of the latter, we follow the 
     lead of Congress. (Majority opinion at p. 509).

  The Grunfeder majority set aside the agency's determination that the 
reparations payments were countable as income because the SSI 
eligibility regulations would frustrate German Restitution Act's 
penitent and restitutionary purpose and because Congress had expressed 
no desire to interfere with the German Government's attempt to make 
amends for crimes committed during the Holocaust. I also note that the 
Court gave great weight to the fact that Congress ratified the 1954 
protocol which exempted from income taxation the restitution payments 
made to Holocaust victims residing in the United States.
  Given that HUD's current interpretation is based solely upon the fact 
that the statute does not provide specific authority to exclude the 
payments from the rent contribution computation and given that Congress 
has never indicated it has had any desire to count Holocaust payments 
as income, any HUD interpretation is as defective as the SSI regulation 
struck down in Grunfeder. Without an express congressional directive, 
no domestic agency official, whether at HHS or HUD, has ever had 
authority to include these restitution payments for any purpose, 
especially eligibility purposes.
  Mr. President, this action is long overdue. I was shocked and 
appalled to learn that an agency of our Government was compounding the 
tragedy of the Holocaust by penalizing a survivor for receiving 
restitution. Were it not for the injuries Fanny Schlomowitz received at 
the hands of the brutal Nazi stormtroopers, she most likely would not 
have been in the HUD-assisted apartment at all. I am sure that there 
are others like Fanny all over the Nation, survivors who are again 
paying a price for nothing more than being victimized by the Nazi 
regime.
  But this bill is necessary for more than the correction of an 
injustice. The German Government makes restitution payments to 
Holocaust survivors as a sincere and humble gesture of apology to the 
people that suffered through the most horrific tragedy in modern 
history. To subject American citizens that receive these payments to 
additional financial burdens is to interfere with the penitent purpose 
of the restitution and to destroy Germany's sovereign right as a nation 
to try to symbolically do right to those who have been terribly 
wronged. The payments are not war reparations and they are not income. 
They are gifts from a nation whose citizens feel the sorrow and shame 
that the Holocaust has brought to all of humanity, citizens that are 
unable to erase history and so do what they can to repent for history.
  Mr. President, it is wholly inexcusable for any agency of the United 
States of America to obstruct this noble sentiment as a matter of 
conscience, and, as a matter of international law, it is unlawful and 
must be stopped from ever recurring.
  Mr. President, I urge my colleagues to join me in support of this 
important legislation. Let us make it possible for Fanny Schlomowitz 
and all Holocaust survivors to graciously accept the gifts from the 
Federal Republic of Germany without interference from our Government.
  Mr. President, I ask unanimous consent that the following articles 
from the Washington Post and New York Times on the issue be printed in 
the Record.
  There being no objection, the articles were ordered to be printed in 
the Record, as follows:

             H.U.D. Rule Puts Squeeze on Holocaust Survivor

                            (By Tamar Lewin)

       Phoenix, Feb. 17.--Since 1964, Fanny Schlomowitz, an 84-
     year-old Holocaust survivor, has been kept from poverty by 
     the monthly payments she receives from the German Government 
     to make up for her mistreatment by Nazis in World War II.
       But now, those same payments are making it difficult for 
     her to afford the federally subsidized one-bedroom apartment 
     where she has lived for the last 12 years--in the Kivel 
     Campus of Care, a sunny, well-tended project for the elderly 
     where she helps take telephone messages and puts together the 
     daily bulletin board announcements.
       ``The manager came last spring and told me she knew I was a 
     Holocaust survivor, and she knew I was getting money every 
     month, and she said that counted as income, so she raised my 
     rent from $63 a month to $227,'' Mrs. Schlomowitz said. 
     ``That leaves me very tight.''
       Most residents at Kivel, one of hundreds of projects for 
     the elderly that are subsidized by the Department of Housing 
     and Urban Development, pay rent of 30 percent of their 
     income, which often consists entirely of Social Security 
     payments. And under the department's guidelines, those with 
     high medical expenses pay even less.
       Until this spring, Mrs. Schlomowitz paid $63 a month for 
     her apartment, a figure determined on the basis of her $370 
     monthly social Security payment, and her large medical bills.
       But Mrs. Schlomowitz also receives about $500 a month from 
     the German Government in reparation for the headaches and 
     dizziness she has suffered ever since a wartime beating in 
     the Jewish ghetto in Budapest. At the time, she was eight 
     months pregnant when she was kicked in the head by Nazis so 
     severely that she was unconscious for two days.
       ``I didn't earn this money, I suffered for it,'' Mrs. 
     Schlomowitz said. ``And I never reported it to H.U.D. because 
     I have a letter from my lawyer saying it is not income. The 
     Internal Revenue service can't touch it, so how can H.U.D.? 
     It's not right.''
       Senator Dennis DeConcini, an Arizona Democrat to whom Mrs. 
     Schlomowitz wrote for help this month, agreed. ``The 
     department's current interpretation is grossly unfair to 
     those who suffered through the most appalling event in modern 
     history.'' Mr. DeConcini wrote in a letter last week to 
     Housing Secretary Henry G. Cisneros. ``These gifts by the 
     Federal Republic of Germany are merely an attempt to atone 
     for an unforgivable horror.''
       In another letter sent today, Mr. DeConcini cited a 1984 
     ruling by the Federal Court of Appeals for the Ninth Circuit 
     that Holocaust survivors' reparation payments not be counted 
     as income for determining welfare eligibility.
       Mr. DeConcini's press secretary, Robert Maynes, noted that 
     Japanese-Americans who receive reparation payments from the 
     United States Government for internment during World War II 
     do not have that money included in computing their subsidized 
     rent.


                          federal law is cited

       A spokesman for the housing department in Washington said 
     that although German war reparation payments were not counted 
     in deciding residents' eligibility for subsidized housing, 
     Federal law required that such payments be counted as assets 
     in setting rent. Any change, he said, would have to be made 
     by Congress, not by the department.
       ``H.U.D. is the only agency that counts this money as 
     income, and it's something we need to change,'' Mr. Maynes 
     said. ``It's kind of a nonsensical bureaucratic approach to 
     say you don't count the money for eligibility but you will 
     count it as income. The I.R.S. doesn't tax this money. H.H.S. 
     doesn't count it as assets. H.U.D. shouldn't count it, 
     either.''
       Nonetheless, since June, Mrs. Schlomowitz has been paying 
     the higher rent of $227 a month--$100 of which is to pay back 
     the Government for the years in which she paid the lower 
     rent.
       ``I really can't afford this,'' she said. ``I pay every 
     three months more than $800 for health insurance and nursing 
     home insurance. I need food and medicine and special shoes 
     because my foot is not so good. And I don't want to take 
     charity from anyone. But like this, I can't buy anything.''
       Rebecca Flanagan, the manager of the local office of the 
     Federal department, said she was seeking guidance from agency 
     officials in Washington.
       ``We have sent a fax to Washington, explaining the 
     situation and asking for further directions, but we haven't 
     got an answer yet,'' she said.
                                  ____


                  With a Little Help From Her Friends

                           (By Guy Gugliotta)

       Every once in a while somebody beats the system. Fanny 
     Schlomowitz, for one, appears to have a great shot at doing 
     it. she isn't going to get rich, but with a little bit of 
     luck she should be even by this time next year.
       Win or lose, however, Schlomowitz already has proven that 
     even an 86-year-old grandmother can win if her cause is 
     just--and if she can find a couple of friends in high places.
       The Department of Housing and Urban Development started 
     leaning on Schlomowitz in early 1992, doubling her rent at a 
     HUD-assisted housing project after learning that she received 
     about $500 per month from the German government.
       Schlomowitz is a Holocaust survivor, a Hungarian Jewish 
     immigrant who endured the Third Reich's extermination camps 
     between 1933 and 1945.
       She emigrated to Houston in 1956, worked in Brooklyn, N.Y., 
     then moved with her husband to the Kivel Campus of Care 
     project in Phoenix 13 years ago so she could be closer to her 
     three children and her grandchildren.
       Her husband has since died, but Schlomowitz remains 
     cheerful and energetic, her Middle European English untouched 
     by nearly 40 years in the New World. ``Ooh, this isn't an 
     Arizona accent,'' she laughed in a recent telephone 
     interview. ``This is a Hungarian accent. Always I'm a 
     Hunky.''
       The $500 Schlomowitz receives from Germany is a reparation 
     paid to compensate her for the dizzy spells and headaches 
     that began after a Nazi soldier clubbed her in the face in 
     the Budapest ghetto.
       HUD doubled her rent at Kivel because those were the rules. 
     The extra $500 meant that her monthly income was $870, not 
     the $370 she receives in Social Security. The rules said more 
     income means more rent: up from $63 per month to $127.
       Furthermore, Schlomowitz had received the reparation ever 
     since she moved to Kivel, so HUD charged her an extra $100 
     per month for the arrearage. Paying $227 per month wiped her 
     out practically overnight.
       Schlomowitz, however, was no dummy. First, local news 
     organizations did articles about her, then she wrote Sen. 
     Dennis DeConcini (D-Ariz.) to tell him what had happened. 
     DeConcini notified HUD Secretary Henry Cisneros, who on March 
     18 exempted Holocaust reparations in calculating eligibility 
     for HUD-assisted housing. Schlomowitz's rent returned to $63 
     in April.
       DeConcini does not plan to run for reelection next year, 
     but if he did, he would have at least one hard-core 
     supporter. ``God bless him, he did a lot for me,'' 
     Schlomowitz said. ``If I hadn't thought of writing him, I 
     don't know what would have happened.''
       At one point federal officials told Schlomowitz that it 
     would take ``an act of Congress'' to change the rules 
     governing program eligibility.
       Fair enough.
       In April, DeConcini and Rep. Henry A. Waxman (D-Calif.) 
     introduced legislation requiring the government to disregard 
     ``certain payments made to victims of Nazi persecution'' when 
     assessing qualifications for any kind of means-tested public 
     assistance--housing or otherwise. Staffers are confident this 
     measure--a bona fide ``act of Congress''--will easily pass 
     both houses early next year.
       It is ``a moral step, with negligible fiscal impact,'' 
     Waxman said in introducing the House legislation. ``The 
     actual number of individuals who will be affected by this 
     bill will be small.''
       Small, and dwindling fast. The New York-based American 
     Gathering of Jewish Holocaust Survivors estimates there are 
     45,000 to 50,000 survivors living in the United States, the 
     vast majority of whom are at least 70 years old.
       Of these, said Michael Feuer, executive director of Bet 
     Tzedek Legal Services in Los Angeles, ``we do not expect 
     there to be 10,000'' who could be described as needy people 
     qualifying for federal assistance. Feuer said most of the 
     survivors, rich or poor, receive $200 to $500 per month from 
     Germany, and, in a few cases, Austria.
       It was Bet Tzedek that argued successfully in federal 
     appeals court 10 years ago that Supplemental Security Income 
     payments could not be denied to a disabled Holocaust survivor 
     because she received $228 per month in German reparations. 
     The recent Cisneros ruling also has exempted housing, and 
     DeConcini-Waxman seeks to cover food stamps, Medicaid and 
     anything else.
       One question still unresolved is the extra $1,968 paid by 
     Schlomowitz during the year when HUD raised her rent. 
     DeConcini plans to ask for an appropriation to cover it and 
     to cover anyone else who might step forward to ask for 
     retroactive relief.
       Getting the money could be a bit sticky, DeConcini's office 
     admitted, but on the other hand, he isn't trying to fund the 
     Superconducting Super Collider. Quite likely, say DeConcini 
     and Waxman aides, there is $1,968 in Schlomowitz's future.
       If so, all of us might take heart. When the bureaucracy 
     pushed Fanny Schlomowitz, she pushed back.
       And the bureaucracy blinked.
  So the bill (H.R. 1873) was deemed to have been considered, read 
three times, and passed.

                          ____________________