[Congressional Record Volume 156, Number 73 (Friday, May 14, 2010)]
[Senate]
[Pages S3783-S3785]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. BURR (for himself, Mr. Akaka, and Mr. Durbin):
  S. 3377. A bill to amend title 38, United States Code, to improve the 
multifamily transitional housing loan program of the Department of 
Veterans Affairs by requiring the Secretary of Veterans Affairs to 
issue loans for the construction of, rehabilitation of, or acquisition 
of land for multifamily transitional housing projects instead of 
guaranteeing loans for such purposes, and for other purposes; to the 
Committee on Veterans' Affairs.
  Mr. BURR. Mr. President, I rise today to offer legislation that would 
improve the Department of Veterans Affairs, VA, Multifamily 
Transitional Housing Loan program. This program, established in 1998 
and supported with a $48 million appropriation in 1999, was intended to 
encourage additional development of transitional housing units for 
homeless veterans. Despite the good intention, the program was viewed 
as too rigid by community providers who turned elsewhere for 
assistance. In fact, only one loan was ever guaranteed under the 
program until VA discontinued it 2 years ago. The legislation I am 
introducing today would modify the program to give it the flexibility 
that community providers say is needed. The bill is cost neutral, 
relying only on money that Congress already has appropriated.
  According to VA more than 107,000 veterans are homeless on any given 
night, including an estimated 1,589 in my home state of North Carolina. 
Many veterans are considered homeless or at risk due to their poverty, 
lack of support systems, and poor living conditions.
  Even though we have seen a decrease in the number of homeless 
veterans from previous years, there is still work to be done. Make no 
mistake; the goal is not only to end homelessness but provide 
sustainable solutions to prevent veterans from, again, falling through 
the cracks. One area that will continue to play an important role in 
keeping veterans off the streets is the provision of transitional 
housing units coupled with onsite supportive services.
  There are a number of VA programs that encourage the development of 
transitional housing units for homeless veterans. One such program, as 
I previously mentioned, was established by Congress in 1998--the 
Multifamily Transitional Housing Loan Guarantee Program. It was 
designed to encourage lenders to make low-interest loans, backed by a 
VA guaranty, available to homeless providers for the acquisition, 
construction, and improvement of transitional housing units. One 
provider, the St. Leo Campus for Veterans in Chicago, IL, operated by 
Catholic Charities, availed themselves of a VA-backed housing loan. 
However, St. Leo's experience is illustrative of why no other provider 
was able to secure a

[[Page S3784]]

loan and why the program was ultimately discontinued.
  The St. Leo Campus for Veterans provides 141 studio units, each 
containing its own kitchen and full bathroom, to formerly homeless 
veterans as well as supportive services to help them become self-
sufficient. On the St. Leo Campus, VA operates a clinic to provide 
outpatient services. In order to get financing for the St. Leo Campus, 
Catholic Charities obtained funding from ten sources, to include the 
VA-backed loan, various state-supported tax credits, and other creative 
funding sources.
  Needless to say, the St. Leo Campus has been faced with numerous 
operational challenges that are typical of a provider servicing the 
homeless population. What exacerbates the challenge is the rigidity of 
the original VA loan program. Without flexibility in loan terms and 
conditions, St. Leo Campus struggles to make ends meet, bringing into 
question the sustainability of the project. To provide the necessary 
services to homeless veterans, St. Leo Campus has relied on one-time 
grants and donations which, in a difficult economy, are a highly 
volatile source of revenue. Flexibility in the terms of its VA-loan, as 
my bill would provide, would give St. Leo Campus and other homeless 
providers a chance to weather some of these cyclical funding 
challenges.
  Recognizing the financing challenges many have in serving this unique 
population, my bill provides VA with the authority to issue loans under 
terms that are far more flexible than the original program. The 
legislation tracks each of the recommendations made in a report to VA 
regarding how the Multi-Family Transitional Housing Loan Program could 
be improved.
  Specifically, the legislation would give VA greater flexibility in 
the types of loans it may offer and the conditions attached to 
repayment, including payment deferral, interest only payments, and debt 
forgiveness. It would give VA the authority to sell, lease, or operate 
a multifamily transitional housing project in the event of default. It 
would preempt any Federal, State, or local housing statute that limits 
a project from offering preferential treatment to veterans. Lastly, it 
would clarify that projects financed with a VA loan may include space 
for job training programs, other types of residential units, or other 
uses that the Secretary determines necessary for the sustainability of 
the multifamily transitional housing projects.
  Transitional housing developed using VA-issued loans under my bill 
would still come with a requirement that a provider make available 
supportive services to reduce the likelihood of veterans again becoming 
homeless. These would include health care services; daily living 
services; personal financial planning; transportation services; income 
support services; fiduciary and representative payee services; legal 
services; child care; housing counseling; and other services necessary 
for maintaining independent living.
  Finally, I again reiterate that this legislation calls for no new 
appropriation. It relies exclusively on $48 million appropriated, (but 
unspent), in 1999 to meet the administrative expenses and initial 
lending capital VA will require. As homeless providers make payments to 
extinguish any loan balance, VA will have the Opportunity to make 
additional loans.
  I am committed to doing all we can to end homelessness among 
veterans. But I am also committed to doing it in a way that is not 
duplicative and fully utilizes money the American people have already 
put forward. I ask my colleagues for their support of my bill.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                S. 3377

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. CONVERSION OF MULTIFAMILY TRANSITIONAL HOUSING 
                   LOAN PROGRAM TO LOAN ISSUANCE PROGRAM.

       (a) Authority to Issue Loans.--
       (1) In general.--Section 2051 of title 38, United States 
     Code, is amended--
       (A) in subsection (a)--
       (i) by striking ``The'' and inserting ``(1) The''; and
       (ii) by adding at the end the following new paragraph:
       ``(2) The Secretary shall, utilizing funds available in the 
     Multifamily Transitional Housing Loan Program Revolving Fund 
     under section 2055 of this title, issue not less than five 
     loans that meet the requirements of this subchapter.'';
       (B) in subsection (b)--
       (i) in paragraph (1), by striking ``under subsection (a)'' 
     and inserting ``under subsection (a)(1)'';
       (ii) in paragraph (2), by striking ``under subsection (a)'' 
     and inserting ``under subsection (a)(1)''; and
       (iii) in paragraph (3), by inserting ``or issued'' after 
     ``guaranteed'';
       (C) in subsection (c), by inserting ``or issued'' after 
     ``guaranteed''; and
       (D) in subsection (g), by inserting ``or issued'' after 
     ``guaranteed''.
       (2) Authority to delegate approval authority.--Subsection 
     (c) of such section, as amended by paragraph (1)(C) of this 
     subsection, is amended--
       (A) by striking ``A loan'' and inserting ``(1) A loan''; 
     and
       (B) by adding at the end the following new paragraph:
       ``(2) The Secretary may delegate approval under paragraph 
     (1) to a State or local government entity.''.
       (3) Sunset of authority to issue loan guarantees.--Such 
     section is further amended by adding at the end the following 
     new subsection:
       ``(h) The Secretary may not guarantee under subsection 
     (a)(1) any loan that is closed after the date of the 
     enactment of this subsection. The termination by this 
     subsection of the authority to guarantee loans under this 
     subsection shall not affect the validity of any loan 
     guaranteed under this subchapter before the date of the 
     enactment of this subsection and is in force on that date.''.
       (4) Conforming amendments.--
       (A) Section 2052(d) of such title is amended by inserting 
     ``or issue'' after ``whether to guarantee''.
       (B) Section 2053(a) of such title is amended by inserting 
     ``or issued'' after ``is guaranteed''.
       (C) Section 2054(a) of such title is amended--
       (i) in the first sentenced, by inserting ``or issued'' 
     after ``guaranteed''; and
       (ii) in the last sentence, by inserting ``or loan'' after 
     ``guarantee''.
       (5) Clerical amendments.--
       (A) The heading of subchapter VI of chapter 20 of such 
     title is amended by striking ``LOAN GUARANTEE FOR''.
       (B) The table of sections at the beginning of such chapter 
     is amended by striking the item relating to subchapter VI and 
     inserting the following new item:

          ``subchapter vi--multifamily transitional housing''.

       (b) Multifamily Transitional Housing Loan Program Revolving 
     Fund.--
       (1) In general.--Subchapter VI of chapter 20 of such title 
     is amended by adding at the end the following new section:

     ``Sec. 2055. Multifamily Transitional Housing Loan Program 
       Revolving Fund

       ``(a) Establishment.--There is established in the Treasury 
     of the United States a revolving fund known as the 
     `Department of Veterans Affairs Multifamily Transitional 
     Housing Loan Program Revolving Fund' (in this section 
     referred to as the `Fund').
       ``(b) Elements.--There shall be deposited in the Fund the 
     following, which shall constitute the assets of the Fund:
       ``(1) Amounts paid into the Fund under any provision of law 
     or regulation established by the Secretary imposing fees on 
     persons or entities issued a loan under this subchapter.
       ``(2) All other amounts received by the Secretary incident 
     to operations relating to the issuance of loans under this 
     subchapter, including--
       ``(A) collections of principal and interest on loans issued 
     by the Secretary under this subchapter;
       ``(B) proceeds from the sale, rental, use, or other 
     disposition of property acquired under this subchapter; and
       ``(C) penalties collected pursuant to this subchapter.
       ``(3) Amounts appropriated or otherwise made available 
     before the date of the enactment of this section for purposes 
     of activities under this subchapter, including amounts 
     appropriated for such purposes under title I of the 
     Department of Veterans Affairs and Housing and Urban 
     Development, and Independent Agencies Appropriations Act, 
     2000 (Public Law 106-74; 113 Stat. 1049).
       ``(c) Use of Funds.--The Fund shall be available to the 
     Secretary, without fiscal year limitation, for all operations 
     relating to the issuance of loans under this subchapter, 
     consistent with the Federal Credit Reform Act of 1990 (2 
     U.S.C. 661 et seq.).''.
       (2) Clerical amendment.--The table of sections at the 
     beginning of chapter 20 of such title is amended by inserting 
     after the item relating to section 2054 the following new 
     item:

``2055. Multifamily Transitional Housing Loan Program Revolving 
              Fund.''.

       (c) Clarification of Authority to Determine Terms and 
     Conditions of Loans.--Subsection (a)(6) of section 2052 of 
     such title is amended by inserting ``including with respect 
     to forbearance, deferral, and loan forgiveness,'' after 
     ``determines are reasonable,''.

[[Page S3785]]

       (d) Clarification of Types of Spaces That May Be Included 
     in Covered Multifamily Transitional Housing Projects.--
     Subsection (c)(1) of such section 2052 is amended by striking 
     ``or job training programs'' and inserting ``job training 
     programs, other types of residential units, or other uses 
     that the Secretary considers necessary for the sustainability 
     of the project''.
       (e) Loan Defaults.--Section 2053 of such title is amended 
     by adding at the end the following new subsection:
       ``(c) The Secretary may impose such penalties or require 
     such collateral as the Secretary considers necessary--
       ``(1) to discourage default on a loan issued under this 
     subchapter; or
       ``(2) to mitigate harm to the Department from default on a 
     loan issued under this subchapter.
       ``(d) The Secretary shall administer any property coming 
     under the jurisdiction of the Secretary by reason of default 
     on a loan issued or guaranteed under this subchapter in 
     accordance with regulations prescribed by the Secretary for 
     that purpose. Such administration of property may include 
     selling, renting, or otherwise disposing of property as the 
     Secretary considers appropriate.''.
       (f) Preferential Treatment of Veterans.--
       (1) In general.--Subchapter VI of chapter 20 of such title, 
     as amended by subsection (b), is further amended by adding at 
     the end the following new section:

     ``Sec. 2056. Preferential treatment of veterans

       ``No provision of Federal or State law may prohibit a 
     multifamily transitional housing project described in section 
     2052(b) of this title from offering preferential treatment to 
     veterans.''.
       (2) Clerical amendment.--The table of sections at the 
     beginning of such chapter, as amended by subsection (b), is 
     further amended by adding at the end the following new item:

``2056. Preferential treatment of veterans.''.
       (g) Technical Corrections.--Section 2052 of such title is 
     amended--
       (1) in subsection (b)(2), by striking ``counselling'' both 
     places it appears and inserting ``counseling''; and
       (2) in subsection (d)(2), by striking ``, as assessed under 
     section 107 of Public Law 102-405''.

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