[Congressional Record Volume 140, Number 145 (Friday, October 7, 1994)]
[Senate]
[Page S]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: October 7, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
 THE VOLUNTARY ENVIRONMENTAL CLEANUP AND ECONOMIC REDEVELOPMENT ACT OF 
                                  1994

 Mr. RIEGLE. Mr. President, I rise to commend my friend and 
colleague, Senator Lautenberg, for his efforts this legislative session 
to enact S. 773, the Voluntary Environmental Cleanup and Economic 
Redevelopment Act of 1994, and the compromise substitute to the bill 
that he and I worked together to develop.
  The substitute bill--which is supported by members of both the 
Environment and Banking Committees--recognizes that the economic 
revitalization of our distressed communities depends upon the 
encouragement of voluntary cleanups and the availability of credit to 
help finance the removal of environmental contamination.
  In crafting this substitute bill, Senator Lautenberg and I have built 
upon the objectives of S. 299, the Abandoned Land Reuse Act, which I 
introduced in February 1993 and which was referred to the Committee on 
Environment and Public Works.
  Mr. President, the substitute bill does not incorporate some of the 
authorities we had proposed in S. 299. But it is very important 
legislation that will successfully encourage the revitalization of our 
Nation's abandoned industrial and commercial sites. For example, the 
substitute bill authorizes the Department of Housing and Urban 
Development to provide partial credit enhancement of site assessment 
and authorizes public or private lenders to provide to local 
governments, local community development organizations and other 
borrowers.
  I am particularly pleased that the substitute bill contemplates a 
risk sharing arrangement, whereby the Federal Government shares equally 
with participating lenders in the credit risk of loans used to finance 
either environmental site assessment or site cleanup. An incentive for 
lenders to undertake sound loan underwriting is created by requiring 
participating lenders to assume 50 percent of the risk of loss. 
Additionally, the Federal Government's risk of realizing a loss on its 
guarantee of the remaining 50 percent of the loan is minimized by 
requiring that participating lenders fund a separate loss reserve to 
cover their anticipated program loan losses. Furthermore, the program 
requires that participating lenders have sufficient commercial lending 
experience and financial and managerial capacity.
  Mr. President, I am also pleased that the credit program authorized 
by this legislation will be administered through State agencies 
selected by the Governors with HUD's concurrence. HUD's primary role, 
therefore, will be to allocate assistance among the States in response 
to information received annually from participating lenders and State 
administering agencies. This arrangement is an improvement over the 
credit program originally outlined in S. 773, in which HUD was given a 
direct lending role without lender participation. Representatives of 
HUD have confirmed that the substitute bill's economic redevelopment 
credit assistance program is preferable to a direct loan program 
administered by HUD. Private and public lenders have also indicated 
their interest in and support for the proposed credit assistance 
program.
  Mr. President, I commend Senator Lautenberg for his efforts and 
cooperation in developing the substitute amendment for the Voluntary 
Environmental Cleanup and Economic Redevelopment Act of 1994. I hope 
that upon his return to the Senate next Congress, Senator Lautenberg 
will continue his efforts to enact this important legislation.

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