[Congressional Record Volume 153, Number 82 (Thursday, May 17, 2007)]
[House]
[Pages H5338-H5343]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
PROVIDING FOR CONSIDERATION OF H.R. 1427, FEDERAL HOUSING FINANCE
REFORM ACT OF 2007
Mr. WELCH of Vermont. Mr. Speaker, by direction of the Committee on
Rules, I call up House Resolution 404 and ask for its immediate
consideration.
The Clerk read the resolution, as follows:
H. Res. 404
Resolved, That at any time after the adoption of this
resolution the Speaker may, pursuant to clause 2(b) of rule
XVIII, declare the House resolved into the Committee of the
Whole House on the state of the Union for consideration of
the bill (H.R. 1427) to reform the regulation of certain
housing-related Government-sponsored enterprises, and for
other purposes. The first reading of the bill shall be
dispensed with. All points of order against consideration of
the bill are waived except those arising under clause 9 or 10
of rule XXI. General debate shall be confined to the bill and
shall not exceed one hour equally divided and controlled by
the chairman and ranking minority member of the Committee on
Financial Services. After general debate the bill shall be
considered for amendment under the five-minute rule. It shall
be in order to consider as an original bill for the purpose
of amendment under the five-minute rule the amendment in the
nature of a substitute recommended by the Committee on
Financial Services now printed in the bill, modified by the
amendment
[[Page H5339]]
printed in the report of the Committee on Rules accompanying
this resolution. That amendment in the nature of a substitute
shall be considered by title rather than by section. Each
title shall be considered as read. All points of order
against that amendment in the nature of a substitute are
waived except those arising under clause 9 or 10 of rule XXI.
Notwithstanding clause 11 of rule XVIII, no amendment to that
amendment in the nature of a substitute shall be in order
except those printed in the portion of the Congressional
Record designated for that purpose in clause 8 of rule XVIII
before the beginning of consideration of the bill and except
pro forma amendments for the purpose of debate. Each
amendment so printed may be offered only by the Member who
caused it to be printed or his designee and shall be
considered as read. At the conclusion of consideration of the
bill for amendment the Committee shall rise and report the
bill to the House with such amendments as may have been
adopted. Any Member may demand a separate vote in the House
on any amendment adopted in the Committee of the Whole to the
bill or to the amendment in the nature of a substitute made
in order as original text. The previous question shall be
considered as ordered on the bill and amendments thereto to
final passage without intervening motion except one motion to
recommit with or without instructions.
Sec. 2. During consideration in the House of H.R. 1427
pursuant to this resolution, notwithstanding the operation of
the previous question, the Chair may postpone further
consideration of the bill to such time as may be designated
by the Speaker.
{time} 1030
The SPEAKER pro tempore (Mr. Pomeroy). The gentleman from Vermont
(Mr. Welch) is recognized for 1 hour.
Mr. WELCH of Vermont. Mr. Speaker, for the purpose of debate only, I
yield the customary 30 minutes to the gentleman from Texas (Mr.
Sessions). All time yielded during consideration of this rule is for
debate only.
I yield myself such time as I may consume.
(Mr. WELCH of Vermont asked and was given permission to revise and
extend his remarks.)
General Leave
Mr. WELCH of Vermont. Mr. Speaker, I also ask unanimous consent that
all Members be given 5 legislative days in which to revise and extend
their remarks on House Resolution 404.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Vermont?
There was no objection.
Mr. WELCH of Vermont. Mr. Speaker, as the Clerk just described, H.
Res. 404 provides for consideration of H.R. 1427, the Federal Housing
Finance Reform Act of 2007, under an open rule with a preprinting
requirement. As of the date required for filing, 36 proposed amendments
have been printed and met the preprinting requirement.
Mr. Speaker, affordable housing is absolutely critical as an issue to
many Americans and certainly to folks in my State of Vermont, as well
as yours. Along with food, health care and energy costs, affordable
housing can make all the difference in economic survival, and we must
begin to take seriously the challenge of affordable housing for renters
and perspective homeowners.
In Vermont, just to give an example, affordable rental units, we have
a shortage of about 20,891 rental units, short of what we need for
working families in Vermont. They need in Vermont an annual income of
$29,000 to afford a statewide average two-bedroom apartment.
The challenge of home ownership, in addition to renting, is daunting.
While many low- and moderate-income households aspire to own their own
home, limited supply, rising costs and other significant barriers can
make that dream out of reach. Beginning in 2005, the new construction
of 12,300 owner-occupied homes in Vermont was needed to meet the demand
expected in 2010, not something that most Vermonters think will be
possible.
The average purchase price for an average single-family home in
Vermont in 2000 was $144,000, a lot less than it might be in the City
of Washington, but beyond the reach of many Vermonters. But 5 years
later, in 2005, the average price had increased a staggering 60 percent
to $232,000, and very few families have seen their paychecks rise 60
percent in the past 5 years.
More than 1 million low-income households across New England,
including the elderly, disabled and families, live in federally
assisted housing. Most of these households have annual incomes of less
than $8,000, well below the poverty line. They are at serious risk of
homelessness. Even larger numbers of households are struggling to
survive in the private housing market and are paying more than 50
percent of their income for rent.
In 1995, the housing community started facing dramatic changes in
Federal housing policy, including funding cutbacks, program reforms and
the devolution of responsibilities to State agencies who lack the funds
to meet the need. Budget cuts aimed primarily at low income people
presented an enormous challenge for communities across the country.
Vermont and the whole of New England region, due to its high housing
cost and large stock of subsidized housing, was one of the most heavily
impacted regions in the country, but by no means unique. In the past
few years, we have witnessed even more dramatic cuts to the important
Federal housing programs, such as section 8, again imposing enormous
burdens on our local communities.
The crisis of affordability is not just a well-crafted political
phrase. It is a fundamental fact in Vermont and around the country, and
it is a problem we must begin to address, as this bill, H.R. 1427,
does.
What H.R. 1427 does is ensure that Fannie Mae and Freddie Mac operate
in a safe and sound financial manner and they fulfill the
responsibilities assigned under their charters given to them by
Congress. These government-sponsored enterprises, or GSEs as they are
called, support the mortgage market, and this bill establishes strong
independent regulation and enhances GSE responsibilities under their
mission.
The bill also creates the first new funding source for affordable
housing since the HOME program was created in the early 1990s, and it
does it without asking the taxpayers to pick up the tab. The $500
million affordable housing fund, which housing advocates in Vermont and
around the country are very excited about, will be used for the badly
needed construction and preservation of affordable housing.
Freddie Mac and Fannie Mae and several of the Federal Home Loan Banks
have experienced considerable accounting, financial reporting and
managerial problems in recent years. Unacceptable. Significant
operational safety and soundness issues have arisen since 2001 that
highlight the need to fortify the supervisory structure for all the
regulated GSEs. This bill will do that.
The Federal National Mortgage Association, or Fannie Mae, and the
Federal Home Loan Corporation, Freddie Mac, were chartered, as you
know, by Congress in 1934 and 1970, respectively, in order to create a
secondary market for mortgages and increase liquidity.
Through their charters, GSEs are granted special privileges not
available to other private sector firms. For example, the Secretary of
the Treasury is authorized to purchase up to $2.25 billion of the
enterprises' obligations. Additionally, GSEs are exempt from State
regulation, State income tax and SEC registration, substantial benefits
conferred to meet a public need of providing affordable housing.
In January 2003, Freddie Mac announced that it needed to revise its
financial statements, resulting in a special review by the Office of
Federal Housing Enterprise Oversight, known as OFHEO.
In November of the same year, following the discovery of accounting
irregularities and a reorganization of its management, Freddie Mac
announced that it had overstated its earnings by $1 billion in 2001. An
investigation into that is ongoing. The company said that the error,
restating its earnings by that $1 billion, stemmed from failure to
properly account for derivatives activity.
In December 2003, OFHEO reported that Freddie Mac disregarded
accounting rules, internal controls and disclosure standards, again all
completely unacceptable. Furthermore, the report found that the company
had misstated its earnings overall by $5 billion between 2001 and 2003,
and that the Board of Directors had failed to exercise its oversight
responsibility. This has got to be corrected.
This bipartisan bill takes an important first step to provide
effective oversight of GSEs in response to the lack of affordable
housing that plagues so many of our communities.
[[Page H5340]]
Specifically, H.R. 1427 does the following:
Federal Housing Finance Agency: It establishes this as an independent
regulator that oversees the safe and sound operation and mission
function of the housing GSEs, Fannie Mae, Freddie Mac and the 12
Federal Home Loan Banks.
Director and Deputy Director: The FHFA will be led by a Director
appointed by the President and confirmed by the Senate for a 5-year
term.
A Federal Housing Enterprise Board is established.
Affordable housing goals: GSEs will be required to meet goals
established by the FHFA for single and multi-family home purchasers in
low income or very low income areas. The goals would be based on data
using 3-year averages to determine the market and they would be set
annually, but could be set for a multi-year period, allowing
flexibility. It requires GSEs to serve underserved markets such as
manufactured housing and affordable housing preservation in rural
areas.
It also establishes an Affordable Housing Fund. The bill creates this
with funds sent directly to the States to be administered as the States
see fit. So we have a local control element here, enhancing the
prospects that the money will be used for its intended purpose. The
fund is intended to be a down payment toward the eventual creation of a
much larger National Housing Trust. In fact, the bill provides that
funds allocated for the Affordable Housing Fund may be transferred at a
later date to the National Affordable Housing Trust Fund that hopefully
we will enact that into law.
The bill also makes sure we take care of the victims of Hurricanes
Katrina and Rita. The individuals living in the devastated gulf coast
need the money immediately. Seventy-five percent of the Affordable
Housing Fund available in the first year will go to Louisiana and 25
percent will go to Mississippi for affordable housing needs arising out
of the hurricanes.
Also the bill is deficit neutral and directs that all of the spending
is fully offset. Seventy-five percent of the contributions made by the
GSEs would be used for the Affordable Housing fund. Twenty-five percent
would be allocated to the Federal Government to keep the bill deficit
neutral.
All of us applaud the work of Chairman Frank for recommending an open
rule to this bill and for the content of this bill, and providing the
first new infusion of funds into an ever rising crisis about affordable
housing.
Chairman Frank came before the Rules Committee and testified we
should allow consideration of all amendments, and we have done that,
with the limitation of a preprinting requirement so as to allow us to
manage and the Members to know what it is they will be debating on the
floor. The rule was agreed to with the chairman, and I am pleased to
bring forth such an open rule.
This is a bipartisan measure. It is supported by a diverse group of
financial institutions, lenders, housing industry participants, housing
groups and other financial service providers. The administration also
supports the bill.
I urge all Members to support this open rule that allows the House to
consider H.R. 1427.
Mr. Speaker, I reserve the balance of my time.
Mr. SESSIONS. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, I want to thank the gentleman from Vermont, my friend,
for not only his friendship, but also for our opportunity to engage
today on this important bill.
Mr. Speaker, I rise in opposition to this unorthodox rule and to a
number of provisions in the underlying legislation in its current form.
While I do appreciate and support the committee's effort to provide for
the safety and soundness of our Nation's housing finance system and
broader financial system, this legislation has a number of fatal
shortcomings that I hope will be corrected during the modified open
amendment process provided for by this rule.
Unfortunately, I cannot support this rule, which breaks with the
longstanding, bipartisan precedent of providing Members with the
certainty of a specific date by which their amendments must be printed
in the Congressional Record so that they may be included in the debate
under this rule. By changing this longstanding, established practice
and only providing Members with the requirement that their amendments
must be printed at an undetermined, unannounced time before the
consideration that this bill begins, Members from both sides of the
aisle are left vulnerable to the scheduling whims of the majority,
which is neither an open nor a transparent way to run the House of
Representatives.
I also find it odd that a majority of the Rules Committee members
would vote to provide for such an open deadline. Just this week, they
demanded such precision in timing from Members and an overworked
Legislative Counsel Office with a filing deadline for the Defense
authorization bill. That is an unprecedented move. Amendments filed
less than 12 hours after this deadline were simply turned away at the
door.
{time} 1045
Members were informed that their noncompliance with the arbitrary
deadline meant that their voices would not even have the opportunity to
be heard in the House.
I wish I could say that I was surprised by this decision made by the
Democrat members of the Rules Committee. Unfortunately, the majority's
selective enforcement of amendment deadlines and disregard for other
long-standing House precedents has become the status quo in the
Democrat Rules Committee. So much for all of those campaign promises to
run the most honest, ethical and transparent House in history.
While this bill does provide for a stronger regulator with increased
powers to ensure the safe and sound operations of the housing
government sponsored enterprises, I must rise in strong opposition to
this bill's worst flaw: A new housing fund mandate that would create a
de facto tax on the middle-class homeowners to finance an expensive and
ill-defined big government housing program.
In its budget score of the legislation, the Congressional Budget
Office acknowledges that the new government-mandated assessments on the
GSEs could very easily be passed on to their customers in the form of
higher fees, meaning that this fund would unfairly target the most
modest home prices to finance this unprecedented government-mandated
redistribution of wealth from the middle class.
I believe it is bad public policy to tie the fate of families that
need housing support to the success or failure of Fannie Mae or Freddie
Mac's portfolios. Even worse because the affordable housing funds would
come from loans that are less than $417,000, which in 12 metropolitan
areas in the country is dangerously close to or below the median home
price, this bill levies a new stealth tax on the most modest home
buyers without even disclosing to them the costs associated with this
new Federal mandate. Mr. Speaker, it is the same as a tax increase to
these middle income home buyers.
To deal with this problem, I will be offering an amendment that
provides useful information to home buyers about the real costs of this
stealth tax. This amendment would require that the director of the
Federal Housing Finance Agency determine what the cost per $1,000
finance would be to home buyers whose mortgages are purchased by the
housing GSEs. This information would need to be disclosed to the home
buyer at or before closing for these mortgages, who qualify for future
GSE purchase, and any additional cost for mortgage originators created
by this new disclosure regulation would be paid for by the housing fund
so that the new disclosure requirement does not create a new, costly
private sector mandate.
Mr. Speaker, if we are going to pass along a brand new, stealth $2.5
billion tax increase on the middle class to pay for their affordable
housing, I think that Congress should at the very least be up front
about the true cost of this fund with those who are being asked to foot
the bill. My amendment simply provides for transparency for mortgage
consumers about the true cost of this new government $2.5 billion
mandate, and I would encourage all of my colleagues on both sides of
the aisle to support it.
Mr. Speaker, I encourage all my colleagues to oppose this restrictive
rule and the underlying legislation in its
[[Page H5341]]
current form, particularly this stealth tax contained in the affordable
housing fund provision.
Mr. Speaker, I reserve the balance of my time.
Mr. WELCH of Vermont. Before yielding to my friend from
Massachusetts, I just want to emphasize that every single Member of
this House did have an opportunity to preprint an amendment, as was
done by my friend from Texas.
In a recent rule, we had a specific deadline by which that had to be
filed. There were complaints from our friends on the other side of the
aisle about a specific deadline. In this case, we extended it so that
depending on what the floor schedule was, there would be the maximum
time available for folks to put their amendments in printed form, and
now there are complaints about that process as well.
Mr. Speaker, I yield 7 minutes to the gentleman from Massachusetts
(Mr. Frank).
Mr. FRANK of Massachusetts. Mr. Speaker, first I ask the indulgence
of the House for the fact that I am dressed a little less spiffily than
is my norm, but I have a cast on my arm and this is all that would go
over it.
Mr. Speaker, I have rarely heard anyone repudiate as much of his
party's past as I just heard from the gentleman from Texas. First he
said this is a restrictive rule. Why, because we said anyone who wanted
to file an amendment could file an amendment. There would be no
rejection of any amendments by the Rules Committee, and the deadline
for that was the day before the bill was to come to the floor. Now we
didn't know when that was. And, in fact, what happened was there was a
possibility that there would have been an extra day. So the gentleman
apparently objects to the possibility of an extra day.
I was also struck that he had two objections to deadlines. One was
the fact that a rule had a deadline; and one was the fact that a rule
didn't have a deadline. He objected to the fact that there was a
deadline on the defense bill. He objects to the fact that there isn't a
deadline on this bill.
Mr. Speaker, let's be very clear: The gentleman objects to the being
in the minority. When you object to a deadline and the absence of a
deadline, you have pretty much exhausted the logical possibilities of
argument, and the gentleman has done that.
Then we talk about this being restrictive. This bill, a very similar
bill, was reported out of the committee under Republican rule in the
previous Congress. Nine amendments were allowed by the Rules Committee;
36 amendments are pending to this bill. So because we only had four
times as many amendments to this bill as when they were in power, we
have become restrictive.
The gentleman says we have upset a long-standing tradition. He is
right. During their rule, the long-standing tradition was amendments
they didn't like and were afraid might pass couldn't be offered. We
have upset that.
Every amendment that anyone wanted to offer is before us. In fact,
the last time this bill came before us, and apparently the gentleman
voted for the rule, the bill came out of committee. In the Rules
Committee, a self-executing rule was adopted that was very
controversial limiting much of what could be done with housing funds,
and the Rules Committee then refused to allow a vote on that self-
executing rule.
So here are the comparisons as the gentleman from Texas laments: Our
lack of openness. When he was in power, the Rules Committee took a bill
that came out of the committee by a bipartisan majority, inserted its
own amendment and insulated that amendment from being voted on. We
instead said here is the bill, offer any amendment you want. This is
pretty topsy-turvy. I understand the demands of partisanship, but
shouldn't logic put some limits on what people would say just to make a
partisan point?
The fact is this bill came out of committee in the last Congress with
an amendment that the Rules Committee put in and wouldn't allow us to
vote on, and we have done exactly the opposite. Then he talks about the
housing funds, and once again, we have the zeal of a convert. He finds
this housing fund a terrible thing, Mr. Speaker. It is a tax on people.
It was in the bill that the Republicans brought to the floor. It was in
the bill that received more than 300 votes, many of the ``no'' votes,
my own included, were from Democrats who objected to the unfair
restrictions on the fund that the self-executing rule imposed.
So when the Republicans were in power, this housing fund was not so
bad. This housing fund came out of committee by a bipartisan majority,
came to the floor, and was voted on in a final bill by over 300
Members. This same housing fund, exactly the same principle, it is
financed a little differently, but with all of the same effects, when
did it become so terrible? What turns a fund to build affordable
housing for lower-income people from a thing to be proud of into a
terrible tax? An election.
When the Republicans were in the majority, this was apparently a good
thing. It was overwhelmingly passed. But now that the Democrats are in
the majority, this same housing fund becomes something that is awful.
It is a housing fund that is supported by the realtors, by the home
builders, by everybody in the housing business because it does not have
the effects the gentleman talks about.
Here is the inconsistency which lies at the root of many of my
colleague's arguments. The purpose of this bill is to put some checks
on Fannie Mae and Freddie Mac. People have said Fannie Mae and Freddie
Mac get certain assistance from the Federal Government that allows them
to borrow money more cheaply from the market, and too little of that
goes to public benefit and too much goes to the stockholders.
So this bill, as did the last bill from the Republicans, headed by
Chairman Oxley, and poor Chairman Oxley, he did Sarbanes-Oxley, he did
this bill. I always thought well of Mike Oxley. I guess I have to
defend him against his former colleagues who now are apparently ready
to tear down everything the poor man did. Mike Oxley deserves better of
you than for you to repudiate all of the good work that he did, and I
speak out. I know you are not supposed to address people who are not
here, Mr. Speaker, so let me say that I want Mike Oxley to know that
there are many of us, and I think a few on his own side, too, who do
respect his work on the housing fund and who respect his work on other
things.
But what we said to Fannie Mae and Freddie Mac was we are going to
have you make a contribution. You should not keep all of the money for
yourself and for your shareholders. We are going to take some of it for
affordable housing.
By the way, this is an affordable housing fund that a great majority
of Republicans voted for 2 years ago. It became terrible because we won
the election. Well, wisdom comes in various ways, and I suppose it came
late to some of my colleagues over there, but better late than never by
their standards.
But the fact is this: In this bill, there will be amendments proposed
that would impose far greater restrictions on Fannie Mae and Freddie
Mac than the housing fund. There is an amendment that I assume many of
them are going to vote for, that would severely restrict what they
could put in the portfolio. Now they make a lot of money off their
portfolio, Fannie Mae and Freddie Mac, and that is part of the money
that goes to help them keep down housing costs. An amendment will be
offered that would severely restrict, that would say only low-income-
type mortgages can go in the portfolio. That would have a far greater
financial impact in reducing funds available to Fannie Mae and Freddie
Mac than the housing fund. The problem is that the housing fund would
help State governments and others build affordable housing, and
apparently there is this ideological opposition to doing that.
By the way, where is this housing fund going to go in the first year,
this terrible tax? It is going to go to Mississippi and Louisiana. It
is going to go to a place where there was terrible devastation of
affordable housing in Louisiana and Mississippi, 75 percent to
Louisiana and 25 percent to Mississippi.
In future years, the money won't be spent until this House and the
Senate and the President pass a subsequent bill deciding how to spend
it. This bill sets it aside, but it leaves to a later bill the
collective decision about how to spend it.
[[Page H5342]]
So we have a rule that allows 36 amendments. Last year they did nine.
We have a rule where the Rules Committee does not add substance. Last
year they did and wouldn't allow us to vote on it.
We do have one thing in common in the bill last Congress and this
Congress: An affordable housing fund. The difference is that the
affordable housing fund which my Republican friends took credit for 2
years ago has transmogrified into a terrible beast solely because the
Democrats are now in power. That doesn't make any sense.
Mr. SESSIONS. Mr. Speaker, I want to notify my colleague from the
Rules Committee that I have no additional speakers at this time. We had
spoken about that before. But, in fact, as a result of the scheduling
that has taken place this morning, none of my colleagues on my side are
available to come down this morning.
Mr. Speaker, as is generally always understood in this House, the
gentleman is generally correct, that the Rules Committee, in fact, did
provide a good number of wonderful amendments that would be made in
order.
The fact of the matter is that as part of this House majority and
minority being able to understand what the Rules Committee is going to
do, we were looking for some transparency and some consistency. I
believe it is important for Members to be able to know when they can
submit those amendments that they might want to have.
It is also true that the majority is the one that determines what
this schedule would be. Members generally have no clue exactly when
amendments are going to be due if you do not give them a deadline and
if you simply say well, before the bill is called up.
The bottom line is we are simply asking that the Rules Committee
would state very clearly when amendments would need to be placed for
consideration, and that is what our point is.
The gentleman also makes other points about the GSEs and about this
House voting on this money that would become available for affordable
housing.
{time} 1100
I recall that earlier this year this House provided for Katrina
housing relief. We've done that, and yet that's now what this bill that
is left over for, that was passed last year was for. And so now what
we're doing is taking a bill that was passed last year through a huge
number of votes in this House, did not pass the other body, was not
signed into law, and yet earlier this year we provided for a housing
fund for Katrina earlier.
Now we're asking for $2.5 billion increase on middle class
homeowners. We're simply saying that we believe that there should be
transparency. We believe that the processes by which this takes place
should be more apparent to Members where they would have these
opportunities to come down.
If the gentleman wants to support a $2.5 billion increase for middle
class consumers, as he did last year by bringing the bill forward, as
he's doing this year, then we will let the Members decide by voting on
that. But I think there should be transparency to the people who will
be footing or paying the bill as to why there's additional costs that
may keep people out of the marketplace because of additional costs
related to them by buying their new home.
Mr. Speaker, evidently at this time I have created an opportunity to
continue dialogue, so I reserve the balance of my time.
Mr. WELCH of Vermont. Mr. Speaker, I yield 1 minute to the gentleman
from Massachusetts (Mr. Frank).
Mr. FRANK of Massachusetts. Well, I again would repeat that the
gentleman said last year I supported this Housing trust fund. So did
almost all the Republicans, but the basic point here is that he
misstated the nature of the hurricane bill.
In the hurricane bill, and the gentlewoman from California who was
its main author is here and will speak shortly, we did not provide any
additional funds for the construction of affordable housing to replace
what was lost. That was mostly with vouchers. We did have some project-
based vouchers in the amount of a couple of thousand, but if the
gentleman will go back to that bill, he will note frequently in the
debate we alluded in that debate to this bill. That is, much of the
rental housing in New Orleans was destroyed. The rental housing was
destroyed in much of the gulf.
This was always a two-bill approach, and the gentleman is simply
wrong to state that in the hurricane bill we provided funds for
additional affordable housing. We stated at the time, we set some rules
about vouchers. We talked about public housing, but we were always
clear it would be this bill that would provide the funds.
So the point that we already did this could not be more incorrect.
Mr. WELCH of Vermont. Mr. Speaker, I yield 5 minutes to the
gentlewoman from California (Ms. Waters).
Ms. WATERS. Mr. Speaker, I rise to support the rule on this very
important piece of legislation and to commend Chairman Frank and the
members of the Financial Services Committee for the wonderful work that
they have done in getting this important reform measure back to the
floor of this House.
As it was said earlier, and I will simply repeat, that this is a good
rule. This is a rule that has opened up opportunities for those who
have amendments to get those amendments before the floor. As Mr. Frank
said, there are more amendments that are being allowed on this bill
today than were allowed on the bill that came before the House last
year on the reform of these GSEs.
This is an important piece of legislation where a lot of work has
been done to get a consensus about how to reform the GSEs and to open
up more opportunities for those who need to be supported on the
secondary market for mortgages.
This is important because we have had a lot of fights in the Congress
of the United States about the GSEs. There were those who for many,
many months simply defended the GSEs. We were frightened that we would
lose this important resource, and we were suspicious of accusations
that were being made about the way that they managed the GSEs, and we
did not go along with some of the changes that were being recommended
some time ago.
But we have all worked very hard and we have compromised. Not only
have the defenders of the GSEs decided that it was time for strong
regulation and that OFHEO had indeed not done the job and given the
oversight that they should have given, we also looked very closely at
what was going on with the FM Watch organization that had been created.
And while we will agree that there were those in the financial services
community who thought that the GSEs were creeping into the retail
market, and we still believe that some of what was done was all about
potential competition, the one thing that we have agreed on is this.
The GSEs are extremely important. They were organized to provide
these opportunities to support them on the secondary market, and we
cannot lose it, and there were some management problems. There were
some accounting problems. Many careers have been destroyed in all of
the fighting that has gone on. OFHEO has been dismantled. We have come
up with good regulation and oversight, and it is time for us to move
forward and not to simply oppose this bill and this rule because we
think one has to be the loyal opposition, opposing whatever comes to
the floor.
It's time to recognize that if we want to do something about creating
and supporting housing opportunities, if we want to deal with what is
happening in the subprime market, if we understand what we're going
through in America today, with all of these foreclosures, with people
being very frightened about whether or not they are going to be able to
hold on to their home, if we understand all of this, we will move very
quickly, not only to support the rule but to support the bill and a
very important aspect of this bill, and that is the housing trust fund.
How can you be against helping Americans who just want a little piece
of the American dream, to be able to own a home? We need to supply more
spots. We need more housing. We need to build affordable housing. We're
not taking any money away from our general fund. We're not taking any
of the revenue that is being counted on to be used for other things in
this huge budget. This is new money. This is money that's created from
the after-profit taxes of these GSEs. It does not threaten our budget
at all.
[[Page H5343]]
How can you be against building new affordable homes for people who
need it all over this country, not just in the cities but in the towns
and in the suburbs and certainly in the rural communities? We have
people who are living in homes that are not fit for humans to live in.
We have people still in some places in the deep South that don't have
toilets and running water. We have folks who are living in some of the
housing and trailers that are falling apart. We need the housing trust
fund. We need this reform. We need this rule, and I would ask support
for it all.
Mr. WELCH of Vermont. Mr. Speaker, I yield 30 seconds to the
gentleman from Massachusetts (Mr. Frank).
Mr. FRANK of Massachusetts. Mr. Speaker, on October 26, 2005, the
House passed the GSE bill that came out of the committee chaired by Mr.
Oxley that had a housing trust fund virtually identical to this one.
This one is financed a little differently at the request of the
Treasury Department, but it's essentially the same thing.
The vote was 331-90. Republicans voted in favor of this bill
containing this housing tax 209-15, and among those who joined in the
majority, the gentleman from Texas (Mr. Sessions). So I appreciate his
concern for this. It did not appear to be evident in October of 2005
when he joined 208 of his Republican colleagues in voting for
essentially this same fund.
Mr. WELCH of Vermont. Mr. Speaker, I'd inquire of the gentleman from
Texas if he has any remaining speakers at this point?
Mr. SESSIONS. I appreciate the gentleman asking. At this time I have
no additional speakers.
Mr. WELCH of Vermont. Mr. Speaker, I'm the last speaker on this side.
So I will reserve my time until the gentleman has closed for his side
and has yielded back his time.
Mr. SESSIONS. Mr. Speaker, I yield myself such time as I may consume.
The gentleman from Massachusetts makes important points. I think that
the gentleman should also hear that we believe there should be
transparency to make sure that these middle class homeowners who would
be buying and paying for this $2.5 billion increase, that they would
understand why that additional cost is being placed on them, and these
are the transparency things that we think that good government can be
about.
The process also has developed itself to where we began talking about
the Rules Committee once again, and Mr. Speaker, two nights ago I was
provided with a summary by the majority party of a breakdown of the
rules, what we have done when I was in the majority in the Rules
Committee versus the Democrats now being the majority party.
And the fact of the matter is through May 15, which is what this is
talking about, the Democrats have had 13 closed rules. The Republicans
had six closed rules over the same period of time. Six closed rules for
Republicans; 13 closed rules for Democrats. Eight open rules for the
Democrats, which they call open rules but that had a preprinting
requirement, so they really should be modified open rules, but the
bottom line is a number of those have been over suspensions that
Republicans did not even place a rule on. We just brought them to the
floor of the House of Representatives and let them see what that
outcome would be.
Mr. Speaker, I would insert this into the Record at this point.
110th rule breakdown through May 15, 2007
43 Total rules:
8 open rules (7 with a preprinting requirement).
20 structured rules.
Thirteen closed rules.
1 conference report rule.
1 procedural rule.
60--Republican/minority amendments in order.
109th rule breakdown through May 15, 2005
29 Total rules:
2 open rules (1 appropriations bill).
15 structured rules.
Six closed rules.
2 conference report rules.
4 procedural rules.
51--Democratic/minority amendments in order.
Mr. Speaker, the Republican Party, my party, is very aware of the
dramatic needs of housing in this country, the needs that people have,
families who have children, elderly people, disabled people, who do
need more affordable and better housing, and that's why you have seen
in our past, as was undisputed on the floor today, about the number of
people who have voted for providing these funds that would be
available.
We do believe that there should be transparency. We believe that the
people, the consumers, who will be paying this additional $2.5 billion
should be told why, what it's for, just as anyone who closes on a house
should understand if there's going to be a FedEx package that would be
delivered or a title fee or some fee that would be associated even with
a notary public, that that should be included as part of the closing
cost of a house to make sure that the consumer knows why and what they
are paying for.
So I would be offering an amendment that was made in order by the
Rules Committee as part of our discussion about how to improve this
opportunity to make transparency available to all the consumers.
Mr. Speaker, I yield back the balance of my time.
Mr. WELCH of Vermont. Mr. Speaker, I yield myself such time as I may
consume.
H.R. 1427, the Federal Housing Finance Reform Act of 2007 ensures
that Fannie Mae and Freddie Mac, the GSEs that support the mortgage
markets, operate in a safe and sound manner and fulfill the missions
assigned to them under their charters.
The bill does this through the establishment of a strong, independent
regulator and through the enhancements to the GSEs mission
responsibilities. The bill also creates the first new funding source
for affordable housing. Since the HOME program was created in the early
1990s, it's been almost 20 years since we have put any infusion of
money from a new source into a growing crisis in housing. The $500
million Affordable Housing Fund, which housing advocates in Vermont, in
your State and States all across this country are very excited about,
will be used by them for badly needed construction and the preservation
of affordable housing.
Very similar legislation, as has been discussed between my colleagues
from Texas and from Massachusetts, passed this House on a strong 331-90
vote last Congress, and this bill, H.R. 1427, was approved in the
Financial Services Committee by a bipartisan vote of 45-19.
I urge a ``yes'' vote on the rule and on the previous question.
Mr. Speaker, I yield back the balance of my time, and I move the
previous question on the resolution.
The previous question was ordered.
The SPEAKER pro tempore. The question is on the resolution.
The question was taken; and the Speaker pro tempore announced that
the ayes appeared to have it.
Mr. SESSIONS. Mr. Speaker, on that I demand the yeas and nays.
The yeas and nays were ordered.
The SPEAKER pro tempore. Pursuant to clause 8 of rule XX, further
proceedings on this question are postponed.
____________________