[Congressional Record (Bound Edition), Volume 149 (2003), Part 17]
[House]
[Pages 23809-23816]
[From the U.S. Government Publishing Office, www.gpo.gov]




                     AMERICAN DREAM DOWNPAYMENT ACT

  Mr. NEY. Mr. Speaker, I move to suspend the rules and pass the bill 
(H.R. 1276) to provide downpayment assistance under the HOME Investment 
Partnerships Act, and for other purposes, as amended.
  The Clerk read as follows:

                               H.R. 1276

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``American Dream Downpayment 
     Act''.

     SEC. 2. DOWNPAYMENT ASSISTANCE INITIATIVE UNDER HOME PROGRAM.

       (a) Downpayment Assistance Initiative.--Subtitle E of title 
     II of the Cranston-Gonzalez National Affordable Housing Act 
     (42 U.S.C. 12821) is amended to read as follows:

                     ``Subtitle E--Other Assistance

     ``SEC. 271. DOWNPAYMENT ASSISTANCE INITIATIVE.

       ``(a) Grant Authority.--The Secretary may make grants to 
     participating jurisdictions to assist low-income families to 
     achieve homeownership, in accordance with this section.
       ``(b) Eligible Activities.--
       ``(1) In general.--Amounts made available under this 
     section may be used only for downpayment assistance toward 
     the purchase of single family housing by eligible families. 
     For purposes of this title, the term `downpayment assistance' 
     means assistance to help a family acquire a principal 
     residence.
       ``(2) Eligible families.--For purposes of this section, the 
     term `eligible family' means a family who--
       ``(A) is a low-income family and a first-time homebuyer; or
       ``(B) notwithstanding the income limitation under section 
     215(b)(2)--
       ``(i) includes a uniformed employee (which shall include 
     policemen, firemen, and sanitation and other maintenance 
     workers) or a teacher who is an employee, of the 
     participating jurisdiction (or an agency or school district 
     serving such jurisdiction) that is providing the downpayment 
     assistance under this section for the family; and
       ``(ii) has an income, at the time referred to in 
     subparagraph (A), (B), or (C) of section 215(b)(2), as 
     appropriate, and as determined by the Secretary with 
     adjustments for smaller and larger families, that does not 
     exceed 115 percent of the median income of the area, except 
     that, with respect only to such areas that the Secretary 
     determines have high housing costs, taking into consideration 
     median house prices and median family incomes for the area, 
     such income limitation shall be 150 percent of the median 
     income of the area, as determined by the Secretary with 
     adjustments for smaller and larger families.
       ``(c) Housing Strategy.--To be eligible to receive a grant 
     under this section for a fiscal year, a participating 
     jurisdiction shall include in its comprehensive housing 
     affordability strategy under section 105 for such year--
       ``(1) a description of the use of the grant amounts;
       ``(2) a plan for conducting targeted outreach to residents 
     and tenants of public housing, trailer parks, and 
     manufactured housing, and to other families assisted by 
     public housing agencies, for the purpose of ensuring that 
     grant amounts provided under this section to a participating 
     jurisdiction are used for downpayment assistance for such 
     residents, tenants, and families; and
       ``(3) a description of the actions to be taken to ensure 
     the suitability of families provided downpayment assistance 
     under this section to undertake and maintain homeownership.
       ``(d) Formula Allocation.--For each fiscal year, the 
     Secretary shall allocate any amounts made available for 
     assistance under this section for the fiscal year in 
     accordance with a formula, which shall be established by the 
     Secretary, that considers a participating jurisdiction's need 
     for and prior commitment to assistance to homebuyers. The 
     formula may include minimum allocation amounts. In 
     considering a participating jurisdiction's prior year's 
     commitment to assistance to homebuyers, the formula shall 
     consider amounts committed to such purpose under the HOME 
     investment partnerships program, the community development 
     block grant program, mortgage revenue bonds, and prior year's 
     funding from State and local governments, provided that the 
     data underlying such funding is uniform, verifiable, and 
     accurate by the State and local government, and shall 
     consider other factors that the Secretary determines to be 
     appropriate.
       ``(e) Reallocation.--If any amounts allocated to a 
     participating jurisdiction under this section become 
     available for reallocation, the amounts shall be reallocated 
     to other participating jurisdictions in accordance with the 
     formula established pursuant to subsection (d), except that 
     if a local participating jurisdiction failed to receive 
     amounts allocated under this section and is located in a 
     State that is a participating jurisdiction, the funds shall 
     be reallocated to the State.
       ``(f) Applicability of Other Provisions.--
       ``(1) In general.--Except as otherwise provided in this 
     section, grants under this section shall not be subject to 
     the provisions of this title.
       ``(2) Applicable provisions.--In addition to the 
     requirements of this section, grants under this section shall 
     be subject to the provisions of title I, sections 215(b) 
     (except as provided in subsection (b)(2)(B) of this section), 
     218, 219, 221, 223, 224, and 226(a) of subtitle A of this 
     title, and subtitle F of this title.
       ``(3) References.--In applying the requirements of subtitle 
     A referred to in paragraph (2)--
       ``(A) any references to funds under subtitle A shall be 
     considered to refer to amounts made available for assistance 
     under this section; and
       ``(B) any references to funds allocated or reallocated 
     under section 217 or 217(d) shall be considered to refer to 
     amounts allocated or reallocated under subsection (d) or (e) 
     of this section, respectively.
       ``(g) Administrative Costs.--Notwithstanding section 
     212(c), a participating jurisdiction may use funds under 
     subtitle A for administrative and planning costs of the 
     jurisdiction in carrying out this section, and the limitation 
     in section 212(c) shall be based on the total amount of funds 
     available under subtitle A and this section.
       ``(h) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section $200,000,000 for 
     each of fiscal years 2004 and 2005.''.
       (b) Relocation Assistance and Downpayment Assistance.--
     Subtitle F of title II of the Cranston-Gonzalez National 
     Affordable Housing Act is amended by inserting after section 
     290 (42 U.S.C. 12840) the following new section:

     ``SEC. 291. RELOCATION ASSISTANCE AND DOWNPAYMENT ASSISTANCE.

       ``The Uniform Relocation Assistance and Real Property 
     Acquisition Policies Act of 1970 shall not apply to 
     downpayment assistance under this title.''.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Ohio (Mr. Ney) and the gentlewoman from California (Ms. Waters) each 
will control 20 minutes.
  The Chair recognizes the gentleman from Ohio (Mr. Ney).


                             General Leave

  Mr. NEY. Mr. Speaker, I ask unanimous consent that all Members may 
have 5 legislative days within which to revise and extend their remarks 
on H.R. 1276 and to insert extraneous material thereon.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Ohio?
  There was no objection.
  Mr. NEY. Mr. Speaker, I yield myself 5 minutes.
  Mr. Speaker, today I rise in support of H.R. 1276, the American Dream 
Downpayment Act. There are many people that we need to thank for the 
point that we have gotten to today to

[[Page 23810]]

have this tremendous piece of legislation here on the floor of the 
House. This was a commitment made by President Bush to do this piece of 
legislation, and Secretary Mel Martinez brought this to our committee 
when I became chairman of the Subcommittee on Housing and Community 
Opportunity.
  I have to also directly thank the gentlewoman from California (Ms. 
Waters), our ranking member of the subcommittee, for all of her work, 
her bipartisan spirit, and her concern for housing for all people from 
all walks of life, from the rural and urban areas across the United 
States. I want to thank the gentleman from Ohio (Mr. Oxley) above all, 
who is chairman of the full committee, for his dedication to this 
important piece of housing legislation, and obviously also to the 
gentleman from Massachusetts (Mr. Frank), the ranking member of the 
full committee. Also on our side of the aisle, and I am sure it will be 
recognized on the Democrat side of the aisle, but Bob Foster, Carter 
McDowell, and Peggy Peterson of the gentleman from Ohio's (Chairman 
Oxley) staff, and also the staff of the Subcommittee on Housing and 
Community Opportunity: Clinton Jones, Cindy Chetti, Tallman Johnson, 
Bob Weisberg, and Hugh Halpern. Again, I want to thank all of these 
individuals for coming together to support the American Dream 
Downpayment Act.
  This bill was introduced by the gentlewoman from Florida (Ms. 
Harris). This initiative is designed to assist thousands of low-income 
families realize the American dream of homeownership. Moreover, this 
new group of homeowners is expected to boost the American economy with 
an infusion of roughly $256 million.
  The benefits of homeownership for families, communities, and our 
country are obviously profound. When our citizens own homes, they 
establish roots and therefore have a greater stake in their community's 
growth, safety, and development.
  While the national homeownership rate has steadily risen and is at an 
all-time high of 60 percent, there are sectors of our population, Mr. 
Speaker, for whom homeownership remains unattainable. In fact, the 
homeownership rate for African Americans and Hispanics is less than 50 
percent. Clearly, this is unacceptable. More can and should be done to 
help all of our citizens realize the true benefits of owning a home.
  If the persistent gap in minority homeownership is to be 
substantially narrowed, the structural barriers to homeownership, 
particularly the lack of capital for downpayments and closing costs, 
must be addressed. I believe this is one of the major points to the 
bill. I can remember when my father was able, finally, after 20 years 
of saving for a downpayment, was able to acquire a house. I was about 
10 years old. It was the greatest day of our lives. But I do not think 
people ought to have to wait 5, 10, 15 years to try to get the 
downpayment. They will struggle to make the mortgage payment, they will 
work two jobs to do it, families will; but that downpayment is a 
serious problem for many people. This legislation eliminates that 
barrier for families struggling to save for a downpayment, but 
otherwise would qualify for homeownership. Many low-income Americans, 
particularly in minority communities, can meet a monthly mortgage 
payment, but they cannot afford the downpayment and closing costs 
associated with a standard residential loan.
  Improving the ability of Americans to make the transition to 
homeownership will be an important test of the Nation's capacity to 
create economic opportunity for minorities and immigrants and to build 
strong and stable communities. In most cases, the purchase of a home 
will be the largest and most significant investment an individual will 
make. Therefore, the home equity created by the home purchase 
represents a significant share of home household net worth for most 
American families.
  This legislation will provide communities throughout America with 
$200 million in grants for each year in fiscal year 2004 and fiscal 
year 2005. An estimated 40,000 low-income families each year will 
achieve first-time homeownership. Each qualifying family will be given 
an average of $5,000 to be used toward downpayment and closing costs.
  The American Dream Initiative will be administered as part of HUD's 
HOME investment partnerships program, known as HOME, an existing 
program that helps communities expand the supply of affordable housing 
for low and very low income families by providing grants to States and 
local governments.
  Mr. Speaker, H.R. 1276 included language that would allow HUD to 
place a maximum cap on the amount of funds certain urban areas could 
receive under the American Dream program. During this consideration of 
this legislation in the full committee markup, the gentleman from New 
York (Mr. Crowley) expressed concern that this language would limit the 
amount of funds areas would be able to receive.
  I would want to note, Mr. Speaker, we have removed the word 
``maximum'' on page 5 of the bill as reported out of the committee. The 
removal of the word ``maximum'' makes the proposed formula in H.R. 1276 
consistent with the pattern and practices of other programs under HUD 
such as HOME and CDBG, and assures that no arbitrary limit is placed on 
the amount of funds any particular area may receive.
  I again want to thank everybody involved with this bill and Secretary 
Martinez for his personal involvement. I also want to commend the 
gentleman from Alabama (Mr. Rogers) and the gentleman from Alabama (Mr. 
Davis) for their leadership on this important piece of legislation. 
Without their diligent support, this legislation would not have been 
possible.
  In closing, Mr. Speaker, I want to note that when the gentlewoman 
from Florida (Ms. Harris) came to us at the beginning of the session, 
she said she wanted to be on the Subcommittee on Housing to make a 
difference for all Americans from all walks of life. I want to note to 
my colleagues today that she surely has made that difference. Through 
the leadership of the gentlewoman from Florida (Ms. Harris), a lot of 
people across this Nation are going to have, for the first time in 
their lives, the opportunity to have a home in a family setting.
  Mr. Speaker, I urge my colleagues to support this initiative.
  Mr. Speaker, I reserve the balance of my time.
  Ms. WATERS. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I rise today to support H.R. 1276, the American Dream 
Downpayment Act, a bill to assist low-income families in achieving 
homeownership by providing downpayment assistance under the HOME 
Investments Partnership Act.
  I would like to thank the chairman of our Subcommittee on Housing, 
the gentleman from Ohio (Mr. Ney), for his leadership. I would like to 
thank him for his evenhandedness in the management of the committee 
that helps to bring us all together in support of legislation that 
makes good sense for all of the Members of this Congress.
  I would like to congratulate the gentlewoman from Florida (Ms. 
Harris) and tell her how fortunate she is as a new Member to have the 
support of her administration in seeing to it that she is able to have 
a bill that will truly do something for American families that we would 
all like to do. Normally, this bill would be thought of as a liberal 
bill. This is the kind of bill that the Democrats would normally roll 
out, if we were in power, because it is talking about spending money, 
it is talking about spending money for poor people who want to have 
homeownership, but cannot afford that downpayment.

                              {time}  1045

  Downpayments are very tough. Many people who pay their bills 
regularly, who have never missed paying their utility bills, they pay 
their rent on time, they work every day, just cannot manage to come up 
with that 10 percent or 15 percent or whatever is being required in 
those markets for downpayments. And so that is why this bill is so 
important.

[[Page 23811]]

  It would create a new subtitle within the Home Investment 
Partnerships Act to authorize grant by formula to States and localities 
for the exclusive purpose of providing downpayment assistance to low-
income first-time home buyers; families, that is, with 80 percent or 
lower of local median income, the formula to be established by HUD, 
based on a grantee's need for and prior commitment to assistance to 
home buyers.
  The bill authorizes $200 million in funding in each of the next 2 
fiscal years. The administration projects that $200 million in funding 
would assist 40,000 low-income home buyers. The downpayment assistance 
authorized under this will be administered by the Home Investment 
Partnership Program that is referred to as HOME. HOME is an existing 
grant program that helps communities nationwide expand the supply of 
housing for low- and very low-income families.
  The House appropriated $125 million for this program in funding year 
2004 VA-HUD appropriations bill approved by the House earlier this 
summer. This is an increase from the $75 million appropriated in the 
funding year 2003 VA-HUD budget for the program contained in the 
omnibus appropriations bill for funding year 2003 passed in February of 
this year.
  Unfortunately, HUD is still writing regulations for this downpayment 
assistance program and has not yet released the funding year 2003 
funding.
  According to HUD study, entitled Barriers to Minority Home Ownership, 
the overall home ownership rate is 68 percent, while home ownership 
rates for African Americans and Latinos are 48 and 46 percent, 
respectively. The HUD report established that one of the most 
persistent barriers to minority home ownership is the lack of capital 
for downpayment and closing costs.
  Without going into a lot more detail, Mr. Speaker, I simply want to 
say that this is a bill that will get support from both sides of the 
aisle. Democrats have been advocating for a long time for these kinds 
of expenditures to deal with the housing crisis in America, and so I 
expect that we will have unanimous support for this bill.
  Mr. Speaker, I reserve the balance of my time.
  Mr. NEY. Mr. Speaker, I yield 5 minutes to the gentlewoman from 
Florida (Ms. Harris), the author of the bill.
  Ms. HARRIS. Mr. Speaker, I thank the gentleman for yielding me time.
  Mr. Speaker, I rise to urge my colleagues to support H.R. 1276, the 
American Dream Downpayment Act.
  As our Nation continues to confront daunting threats both at home and 
abroad, we cannot neglect the most basic security of all, and that is a 
safe, clean, adequate place to live. Across our Nation, families and 
individuals are consigned to deplorable conditions in substandard 
housing. In a Nation that enjoys a level of wealth and material comfort 
that is unprecedented in human history, this state of affairs is 
unconscionable.
  We have the power to address this obligation of a decent, 
compassionate society today. Better yet, we can attack the housing 
crisis besetting our Nation by attacking the poverty that underlies it.
  H.R. 1276 constitutes the first step in fulfillment of President 
Bush's plan to create 5.5 million new minority home owners by the end 
of the decade. This visionary initiative will add $256 billion to the 
American economy.
  As I have consulted with housing advocates throughout my district, I 
have repeatedly heard that a great number of low-income Americans could 
meet their monthly mortgage payment, but they cannot surmount that 
initial obstacle of a downpayment and closing costs. Thus, a steep 
entry fee is all that stands between many low-income Americans and the 
dignity, the stability, and the economic empowerment of home ownership.
  The resulting home ownership gap, which disproportionately impacts 
African Americans and Hispanic Americans, has staggering economic and 
social consequences. Studies show that the average worth of a low-
income person, about $900, skyrockets to $70,000 when they own a home. 
In 1998, owner-occupied property constituted 21 percent of all 
household wealth as well as more than 71 percent of all tangible 
wealth.
  Moreover, the home ownership gap dramatically impacts the lives of 
our children. Statistics show that children of families who own their 
own home experience a 13 percent higher graduation together with a 7 
percent accelerated rate in math achievement and reading recognition. 
Additionally, such children complete almost one half year more of 
education.
  For the young people who live in homes their families own, they enjoy 
a greater level of self-esteem while receiving an indispensable 
educational exercise in the proper maintenance of personal property.
  Mr. Speaker, H.R. 1276 empowers tens of thousands of low-income 
Americans to overcome this striking inequality in our land of 
opportunity. As a compassionate society, we have a moral obligation to 
empower individuals and families and communities with the tools to 
build their own prosperity. By authorizing a total of $400 million in 
grants to communities throughout America over fiscal years 2004 and 
2005, this bill will enable 80,000 low-income Americans to purchase 
their first home.
  As we proceed to a vote on this revolutionary bill, I would like to 
recognize the Bush administration and the gentleman from Alabama (Mr. 
Rogers) for their continued commitment to extending quality, affordable 
housing to every American, as well as for their tremendous creativity 
in developing solutions that can help us achieve this goal.
  Further, I wish to express my gratitude to the gentleman from Ohio 
(Mr. Oxley) and the ranking member, the gentleman from Massachusetts 
(Mr. Frank) of the Committee on Financial Services, as well as my 
deepest appreciation to the gentleman from Ohio (Mr. Ney) who has 
assisted me daily with this bill, and the ranking member, the 
gentlewoman from California (Ms. Waters) of the Subcommittee on Housing 
and Community Opportunity for their outstanding leadership in 
shepherding H.R. 1276 through the legislative process.
  Finally, I wish to acknowledge the support of the gentleman from 
California (Mr. Gary G. Miller), as well as my dear friend, the 
gentleman from Arizona (Mr. Renzi) and the gentleman from Alabama (Mr. 
Davis) for his extraordinary bipartisanship. Their passionate 
dedication to fulfilling this moral imperative of quality affordable 
housing for every American continues to inspire us all.
  I would like to thank our extraordinary committee staff for their 
diligence and expertise, as well as my outstanding staff member, Miguel 
Romano, for his diligent work on this bill.
  Today, let us reaffirm the expansiveness of the American dream by 
passing this vital legislation.
  Ms. WATERS. Mr. Speaker, I yield 3 minutes to the gentleman from 
Alabama (Mr. Davis).
  Mr. DAVIS of Alabama. Mr. Speaker, let me compliment my colleague, 
the gentlewoman from Florida (Ms. Harris) as the primary sponsor of 
this bill and let me compliment the chairman of the subcommittee, the 
gentleman from Ohio (Chairman Ney) for his leadership on this issue. 
Let me extend compliments as well to the ranking member of the 
subcommittee, who is present here today, the gentlewoman from 
California (Ms. Waters) and the gentlewoman from California (Ms. Lee), 
who is not here.
  We do a lot of things in this institution, Mr. Speaker. We argue 
about a lot of issues, but every now and then we manage to find 
something we agree on. Every now and then we manage to find something 
that has enormous bipartisan appeal. And that is how we have arrived at 
H.R. 1276. Whether it is in the district of the gentlewoman from 
California (Ms. Waters) or my district or the district of the 
gentlewoman from Florida (Ms. Harris), wherever you go in this country, 
the American dream is very much expressed in terms of whether or not 
people have a chance to own a home.
  As the gentleman from Ohio (Chairman Ney) said earlier, for the 
overwhelming majority of people in this

[[Page 23812]]

country of ours, the only tool of wealth they will ever have, the only 
significant assets they will ever have is a home. We can talk about all 
the indices of community engagement, from whether you vote to whether 
or not you mow your lawn, to whether or not you participate in your 
neighborhood association. The greatest correlator of community 
engagement is home ownership.
  We look at our economy in the last 2 years, and all of us on both 
sides of the aisle would agree, if you take out the housing boom, if 
you somehow remove that from our economy, we would be deep in the 
throes of a 2\1/2\-year recession now.
  This is very important work, and it is a compliment to the leadership 
on both sides of the aisle that this bill has made its way to the 
floor. And it is a compliment to the gentlewoman from Florida (Ms. 
Harris) and the gentlewoman from California (Ms. Waters) that we have 
arrived at a consensus here today.
  I want to make a few basic points. We have a lot of unfinished work 
on the housing front. No one on our side of the aisle would suggest 
that this is all that needs to be done. No one on our side on the aisle 
would suggest that the $200 million is the only commitment of resources 
that we ought to make. But rest assured that this $200 million 
commitment will result in over 40,000 low-income families receiving 
help in buying homes.
  I can say briefly in conclusion, Mr. Speaker, as I travel around my 
district, we regularly do home ownership events, we regularly do 
housing events; and I always enjoy seeing the spark that I see in 
people's faces when they have a chance to finally become home owners. I 
enjoy seeing the spark when they know they are going to finally realize 
their piece of the American dream.
  We have made this bill better. It was a good bill. We have made it a 
better bill. We have made the formula for calculating downpayment 
assistance a fair and better formula. We will address the unfinished 
aspects of this bill related to credit counseling. We will more forward 
on those fronts.
  I encourage my colleagues, as I know they will today, to vote 
overwhelmingly for the American Dream Downpayment Act. I am proud to be 
one of the original sponsors of this bill, and I again compliment my 
friend from Florida for her leadership on this issue.
  Mr. NEY. Mr. Speaker, I yield 3 minutes to the gentleman from Arizona 
(Mr. Renzi), a tremendous new member, but a member that has immediately 
gotten to work on our Subcommittee on Housing and Community Opportunity 
to help the people not only of his district, but of the Nation.
  Mr. RENZI. Mr. Speaker, I would like to commend the gentlewoman from 
Florida (Ms. Harris), my friend, on her substantive and important 
bipartisan legislation.
  H.R. 1276 will help tens of thousands of low-income Americans achieve 
the dream of owning their first home. We know equity in a home is the 
primary asset used by most American families to help their kids get to 
college. In addition, many small business owners use the equity in 
their home to borrow and start their first small businesses here in 
America, to help our growing economy and to support their growing 
families.
  This legislation provides $200 million in grants to over 40,000 low-
income families over the next 2 years. This money will assist low-
income families with downpayments and closing costs.
  Today, more than two-thirds of Americans own their home, but fewer 
than half of African American and Hispanic families are home owners and 
less than one-third are Native Americans. This legislation is a real 
help to all families. Studies have shown that math achievement and 
reading recognition levels are 7 percent higher for children with 
families who own their own home, and they complete almost a half-year 
more education if they have home ownership. High school graduation 
rates for children with families who own their own home are 13 percent 
higher than renting families.
  Let us remove the obstacles and give deserving families a real 
chance. Rally around the leadership shown by the gentlewoman from 
Florida (Ms. Harris) and let us work together to pass this needed 
legislation.
  Ms. WATERS. Mr. Speaker, I yield 3 minutes to the gentleman from 
California (Mr. Baca).
  Mr. BACA. Mr. Speaker, I rise in support of the American Dream 
Downpayment Act, H.R. 1276, sponsored by the gentlewoman from Florida 
(Ms. Harris) and of course my good friend, the gentleman from Ohio (Mr. 
Ney) who happens to be a Member from that area as well. His mother 
lives in Fontana. And of course our minority leader as well, who has 
been very instrumental, and that is the gentlewoman from California 
(Ms. Waters), in fighting to ensure that many of the poor and 
disadvantaged have opportunities in many different areas. This is an 
area that she is fighting for to make sure that individuals have an 
opportunity to own a home for the very first time.
  Right now, Hispanics and minorities are struggling to purchase homes 
at a far greater rate than the rest of the Nation. In my own district, 
the Hispanic ownership rate is only 59 percent. That is nearly 10 
percent less than the national average, and it is 15 percent less than 
the national non-Hispanic white average.
  In my own district, which is 58 percent Hispanic, it has become 
increasingly difficult for Hispanics to own businesses because there is 
a housing boom that is causing the prices to skyrocket. In our area, we 
have the majority of growth which continues to move from L.A. to Orange 
County into our area, but it has become difficult for them to become 
first-time home buyers.
  The median housing price in San Bernardino County went from $116,000 
in the year 2002 to $207,000 in August. That is a 29 percent increase.

                              {time}  1100

  Hispanics and minorities all over the Nation are struggling to keep 
up. Not only do Hispanics earn less in wages than the rest of the 
population, but Hispanic unemployment is rising as well. Right now, 
Hispanic unemployment is nearly 7.8.
  At the same time, we have an administration that is pushing for 
programs to turn Section 8 low income-housing vouchers into State 
blocks. In California, and States with huge budget deficits, it will 
hurt the low-income minority population because they will not be able 
to rent, let alone buy a home.
  But the American Dream Downpayment Act will help Hispanics and many 
other minorities become homeowners. It will help low-income and first-
time home buyers make downpayments on their first home. We must make 
sure we give them that opportunity.
  I know what it was like because I come from a large family of 15, and 
let me tell my colleagues for the very first time that my dad was able 
to purchase a home, while it was very difficult, we fell under that 
category, but it was important for me and for my family to have 
stability. We had a foundation for the very first time. We were able to 
own a home that we never owned before because we were moving from one 
place or project to another project, living in the ghettos and the 
projects, moving from one place to another, but instability had allowed 
it.
  This act will allow individuals to have that stability we need to 
say, I am going to one school, I do not have to go to four, five or six 
different schools as I went. It will also help increase the education 
amongst the kids where they have the stability in terms of going to one 
school, having their friends that are there and being able to take 
pride in their home. I know what it was like, and I took pride in my 
home when we had it.
  Let me tell my colleagues, Mr. Speaker, I urge support of this bill. 
It is a good bill, and I compliment our minority leaders and the 
gentlewoman from Florida (Ms. Harris) in carrying this legislation.
  Mr. NEY. Mr. Speaker, I yield 3 minutes to the gentleman from 
California (Mr. Gary G. Miller), another great member of our 
Subcommittee on Housing and Community Opportunity, who

[[Page 23813]]

has been extremely active in concerns and issues of housing.
  Mr. GARY G. MILLER of California. Mr. Speaker, I really want to 
commend the gentlewoman from Florida (Ms. Harris) for doing this. This 
is a really, really, really good bill. I had been a builder for over 30 
years in my real life before coming to government. The gentleman from 
Ohio (Chairman Oxley) really has a passion for this issue. The 
gentleman from Massachusetts (ranking member Frank), a good friend of 
mine, has really done everything he can to look for opportunities to 
really help people get into homes, and the gentleman from Ohio (Mr. 
Ney), who chairs the Subcommittee on Housing and Community Opportunity, 
just has a supervision and really looks for things that are good.
  Some would say, why are we doing this? I am a conservative 
Republican, and one would say, well, why is the government getting 
involved in this issue. Some real good reasons. The average homeowner 
has assets totalling about $70,000. Yet the average low-income renter's 
assets are below $1,000. Most of these people that are going to benefit 
from this program are already on Section 8 housing vouchers or they are 
in some type of government housing. So how do we create an environment 
where people rely on themselves and count less on government? That is 
to get them in a home.
  If we leave people in Section 8 housing, they are going to be there. 
They cannot get out. They do not have the downpayment, the necessary 
wealth to be able to move into society, as we would say it, and have 
the experience of the dream of owning a home. There is nothing like 
selling a home to somebody, watching a person and a family move into 
home, they have dreams, they have anticipations, they make plans for 
the future.
  This is a good bill. Imagine if we get a family into a home that is 
now receiving government subsistence, at a point in time they no longer 
need help from the government because they have acquired wealth in 
their own home. When they buy that home, their rent remains consistent. 
When they take and rent a home, whether it is through Section 8 or a 
government home, the rent increases as the years goes by. So look at a 
situation where a family moves into a home, 10 years from now, they are 
going to pay a lot more than they currently pay if they are renting a 
home, but if they own that home, they are paying the same 10 years from 
now as they are today.
  Our goal in government should be to do everything we can to create 
the best economic environment we can for the citizens. The best way to 
do it is to get people into their own home. There is nothing, nothing 
like moving people into something that they consider their own, rather 
than something they consider somebody else's they are allowed to rent.
  We have a situation growing in this country that I consider the new 
homeless, and these are people who have good jobs, the husband and wife 
both work, the husband might be a policeman or a fireman, the wife 
might be a nurse or whatever or a schoolteacher, and yet they cannot 
afford to live within the community within which they work. How many 
people do my colleagues know whose children were raised in a community 
they cannot afford to buy a home and live within the city in which they 
spent their life growing up because it has become so expensive? In many 
cases, government has created so many roadblocks, they have increased 
the cost of housing, that we need to look at every opportunity we have 
to eliminate the roadblocks, to decrease the restrictions and to do 
everything we can to move people into homeownership.
  There is a huge shortage of Section 8 housing and government housing 
for low-income people. People are on waiting lists, and the reason is 
the people who currently live in those homes cannot afford to move up 
to the next level. They are relegated to that, and we have to change 
that.
  This is a great opportunity. It is a bipartisan bill, and I would 
strongly encourage a yes vote.
  Ms. WATERS. Mr. Speaker, how much time do I have left on this side?
  The SPEAKER pro tempore (Mr. Shaw). The gentlewoman from California 
(Ms. Waters) has 10 minutes remaining, and the gentleman from Ohio (Mr. 
Ney) has 6 minutes remaining.
  Ms. WATERS. Mr. Speaker, I yield myself as much time as I may consume 
to close out the bill.
  Mr. Speaker, this bill is motherhood and apple pie. This is what 
public policy should be about, recognizing a need and moving to place 
in law some law that will indeed help those who really do need 
assistance to realize the American dream. This did not start today, did 
not start yesterday.
  We have a lot of legislators who have worked on this. Congresswoman 
Roukema is not here anymore. She worked on this, and I think we had it 
in the 2003 Omnibus bill. We did not get that at that time, but it has 
been revisited in this way by the gentlewoman from Florida (Ms. 
Harris), and again, there will be no opposition. Truly, this is 
motherhood and apple pie. Homeownership, there are so many people who 
are desirous of owning their homes, who work every day but cannot 
afford that downpayment.
  I am pleased that we spent time in committee thanks to the gentleman 
from Ohio (Mr. Ney), and Democrats were able to improve this bill 
during the committee markup by offering several amendments that were 
adopted, I would like to thank the gentlewoman from New York (Ms. 
Velazquez), the gentleman from Massachusetts (Mr. Capuano) and the 
gentleman from New York (Mr. Crowley), and even an amendment that I 
offered to require targeted outreach programs. My amendment requires 
participating jurisdictions to conduct outreach to people living in 
public housing, Section 8 housing and manufactured housing as part of 
their plan to access these dollars. That means we are taking care of 
inner city, we are taking care of suburbia and we are taking care of 
the rural areas. It is not just about public housing. It is about 
manufactured housing, also, and so we worked to make sure that the 
outreach that is done is comprehensive. This outreach will ensure more 
residents will have an opportunity to share in the American dream and 
break their dependence on public housing assistance.
  I am also pleased that the committee report on this bill includes 
report language clarifying that funds appropriated for this program 
should be new money and not be offset by a reduction in HOME block 
grants. Sometimes we come up with bills and we talk about the costs, 
but yet we do not appropriate new money. We reduce the money in some 
other pot, and we have language in this bill that will prevent that 
from happening.
  Mr. Speaker, owning a home also can provide a sense of security and 
contribute to safer, stronger neighborhoods. A financial and personal 
stake in a residence helps the residents to create a better 
neighborhood where families, children and all the elderly can thrive 
and enjoy a better quality of life.
  I am pleased to be a part of this committee. I am pleased to work 
with my colleagues on both sides of the aisle.
  Mr. Speaker, I yield back the balance of my time.
  Mr. NEY. Mr. Speaker, I yield 2 minutes to the gentleman from 
Michigan (Mr. Rogers) who actually carried this bill, introduced it 
last session, and we appreciate his support.
  Mr. ROGERS of Michigan. Mr. Speaker, I thank my friend the gentleman 
from Ohio (Mr. Ney) and I thank the gentlewoman from California (Ms. 
Waters) for all that she has done to get this bill on the floor and her 
leadership, and I thank the gentlewoman from Florida (Ms. Harris) very 
much for taking charge of this bill this session and getting it to 
where it was.
  It was a little bit over a year ago that I stood in Detroit, 
Michigan, celebrating the 100th Habitat home going up with Secretary 
Martinez, and it was a great day for us. It was kind of a little bit 
chilly, a little bit rainy, but the excitement, the joy, even the tears 
about having that key go in that door and turning that knob was 
exhilarating and exhilarated a whole community as

[[Page 23814]]

we stood under that tent together opening the door of that new home for 
that family. In that same crowd, there were dozens of folks who were 
there who had a little bit of hope to experience that very same 
exhilaration by sticking that key in that door and calling it theirs, 
calling it their home. We all know that there is a difference between a 
place to live and a home.
  That day, that particular house, built by volunteers and the family 
that was going in, became a home in a community that needed all the 
help it could get. It had a very low homeownership rate, and what we 
found is that as we increased these number of homes, truancy went down, 
crime rates went down, investment in the community, the school overall 
performance went up, and that is what this bill is about, and we should 
not forget it.
  It is about minority ownership coming up to where it needs to be, but 
it is about the very gift to the very family who is playing by the 
rules, getting up every day, doing the right thing, paying all their 
bills, putting shoes on their children's feet, making their rent 
payments, making their utility payments, and this is the one hurdle, 
the very one hurdle that stops them, that puts them in the back of the 
tent watching somebody else put that key in the door.
  For all of my colleagues that helped do this, I thank them very, very 
much. This will be a profound impact on thousands and thousands of 
American families. This is an investment in our future. I want to thank 
all of my colleagues for their commitment to this. I thank the 
gentleman from Ohio (Mr. Ney). I thank the gentlewoman from Florida 
(Ms. Harris) for her leadership and Secretary Martinez for championing 
this cause.
  Mr. NEY. Mr. Speaker, I yield 2 minutes to the gentleman from South 
Carolina (Mr. Wilson). He and his staff have been very energetic in 
support of this bill.
  Mr. WILSON of South Carolina. Mr. Speaker, I rise in support of H.R. 
1276, the American Dream Downpayment Act, and I want to commend the 
gentleman from Ohio (Mr. Ney) for his leadership. I want to commend the 
gentlewoman from Florida (Ms. Harris) for her wonderful leadership on 
this issue, and then my colleague the gentleman from Michigan (Mr. 
Rogers) who has from the beginning been such an important part as he 
understood and eloquently explained the bill just now.
  More than two-thirds of all Americans own their own home. However, 
fewer than half of all African American and Hispanic families are 
homeowners. For these families, one of the biggest barriers to 
homeownership is the inability to afford the downpayment and closing 
costs associated with purchasing a home. This legislation seeks to help 
close this homeownership gap by making $200 million in grants available 
to more than 40,000 first-time, low-income families to help them 
achieve the American dream of homeownership.
  This is especially important to the 2nd Congressional District of 
South Carolina where many families would greatly benefit from this 
legislation. Too often, the dream of raising your family in your own 
home seems far out of reach. As a former real estate attorney, I know 
firsthand the joy of working with first-time home purchasers, 
especially because I worked pro bono with the meaningful Habitat for 
Humanity program, along with the Home Builders Association and the 
Realtors Association.
  Further, the American Dream Downpayment initiative will help low- and 
moderate-income families build wealth. Consider that the average 
homeowner's assets total $70,000, while the average low-income renter's 
assets are below $1,000. Equity in a home, the primary asset held by 
most American families, is the best mechanism that families have for 
wealth creation. We can use our homes to send our children to college, 
to start small businesses and to build better lives.
  In short, homeownership makes family stakeholders in their 
communities. H.R. 1276 will increase the rights of stakeholders and 
bring stability and a new revitalization to our communities. I urge all 
my colleagues to support H.R. 1276.
  In conclusion, God bless our troops.
  Mr. NEY. Mr. Speaker, I yield 1 minute to the gentlewoman from New 
York (Ms. Velazquez).
  Ms. VELAZQUEZ. Mr. Speaker, I would like to enter into a colloquy 
with the gentleman from Ohio (Mr. Ney).
  It is my understanding that, during committee consideration, an 
agreement was made between the chairman and myself to incorporate the 
provision dealing with financial literacy into the report on H.R. 1276. 
I would like this language to be included into the Record.
  Mr. NEY. Mr. Speaker, will the gentlewoman yield?
  Ms. VELAZQUEZ. I yield to the gentleman from Ohio.
  Mr. NEY. Mr. Speaker, I just wanted to respond, it is my 
understanding and I accept the language as was just stated.
  Ms. VELAZQUEZ. Mr. Speaker, that is my colleague's understanding, and 
I thank the gentleman for that. I will insert that language at this 
point in the Record.

       The full Committee also adopted two amendments during 
     consideration. The first would require States and localities 
     to ensure that families receiving the housing assistance are 
     financially prepared to maintain ownership of their homes 
     after the purchase by requiring recipients to complete a 
     course of homeownership counseling. Alternatively, if this is 
     not feasible, grantees could provide information in advance 
     to grant recipients describing the risks and responsibilities 
     of homeownership, providing assistance in understanding the 
     mortgage loan process and financing options, and making 
     recipients aware of any homeownership counseling that is 
     available locally.

  Mr. NEY. Mr. Speaker, I yield myself such time as I may consume.
  In closing, let me just, once again, thank our chairman, the 
gentleman from Ohio (Mr. Oxley) for his diligence and perseverance in 
the way he has handled the committee, to produce many good products 
over this session, and when it comes to housing, he has given us the 
backing we needed; the gentleman from Massachusetts (Mr. Frank), the 
ranking member, the gentlewoman from California (Ms. Waters), our 
ranking member of the subcommittee, who has helped so much on this bill 
and also to everybody again that made this bill possible.
  I just want to conclude by saying it is a dream for many Americans to 
have their homes, from all walks of life.

                              {time}  1115

  We are taking a step today on the floor of this House to do that. 
This is a bill that every Member of this House can be proud of. It is a 
bill that they can support, and it is a bill that is going to do 
something for generations to come as people establish their home, as 
people are able to take care of their families and be part of their 
communities in a very, very productive way.
  Again, Mr. Speaker, in closing and in urging support, I want to thank 
the gentlewoman from Florida (Ms. Harris), who had the desire, the 
tenacity and definitely put in all the time needed to make sure that 
this bill became a reality today. Without her, we would not be here 
today producing this bill, which, again, will help future generations. 
So I urge support of the bill.
  Mr. PAUL. Mr. Speaker, the American dream, as conceived by the 
Nation's Founders, has little in common with H.R. 1276, the so-called 
American Dream Downpayment Act. In the original version of the American 
dream, individuals earned the money to purchase a house through their 
own efforts, often times sacrificing other goods to save for their 
first downpayment. According to the sponsors of H.R. 1276, that old 
American dream has been replaced by a new dream of having the Federal 
Government force your fellow citizens to hand you the money for a 
downpayment.
  H.R. 1276 not only warps the true meaning of the American dream, but 
also exceeds Congress' constitutional boundaries and interferes with 
and distorts the operation of the free market. Instead of expanding 
unconstitutional federal power, Congress should focus its energies on 
dismantling the federal housing bureaucracy so the American people can 
control housing resources and use the free market to meet their demands 
for affordable housing.
  As the great economist Ludwig Von Mises pointed out, questions of the 
proper allocation

[[Page 23815]]

of resources for housing and other goods should be determined by 
consumer preference in the free market. Resources removed from the 
market and distributed according to the preferences of government 
politician and bureaucrats are not devoted to their highest-valued use. 
Thus, government interference in the economy results in a loss of 
economic efficiency and, more importantly, a lower standard of living 
for all citizens.
  H.R. 1276 takes resources away from private citizens, through 
confiscatory taxation, and uses them for the politically favored cause 
of expanding home ownership. Government subsidization of housing leads 
to an excessive allocation of resources to the housing market. Thus, 
thanks to government policy, resources that would have been devoted to 
education, transportation, or some other good desired by consumers, 
will instead be devoted to housing. Proponents of this bill ignore the 
socially beneficial uses the monies devoted to housing might have been 
put to had those resources been left in the hands of private citizens.
  Finally, while I know this argument is unlikely to have much effect 
on my colleagues, I must point out that Congress has no constitutional 
authority to take money from one American and redistribute it to 
another. Legislation such as H.R. 1276, which takes tax money from some 
Americans to give to others whom Congress has determined are worthy, is 
thus blatantly unconstitutional.
  I hope no one confuses my opposition to this bill as opposition to 
any congressional actions to ensure more Americans have access to 
affordable housing. After all, one reason many Americans lack 
affordable housing is because taxes and regulations have made it 
impossible for builders to provide housing at a price that could be 
afforded by many lower-income Americans. Therefore, Congress should cut 
taxes and regulations. A good start would be generous housing tax 
credits. Congress should also consider tax credits and regulatory 
relief for developers who provide housing for those with low incomes. 
For example, I am cosponsoring H.R. 839, the Renewing the Dream Tax 
Credit Act, which provides a tax credit to developers who construct or 
rehabilitate low-income housing.
  H.R. 1276 distorts the economy and violates constitutional 
prohibitions on income redistribution. A better way of guaranteeing an 
efficient housing market where everyone could meet their own needs for 
housing would be for Congress to repeal taxes and programs that burden 
the housing industry and allow housing needs to be met by the free 
market. Therefore, I urge my colleagues to reject this bill and instead 
develop housing policies consistent with constitutional principles, the 
laws of economics, and respect for individual rights.
  Mr. BEREUTER. Mr. Speaker, this Member rises today to express his 
support for H.R. 1276, the American Dream Downpayment Act. This bill, 
of which this Member is an original cosponsor, authorizes $200 million 
in grants to be made available as part of the HOME program to first-
time low-income families for downpayment assistance. This important 
legislation is strongly supported by the Administration and is a 
priority of the distinguished Secretary of the Department of Housing 
and Urban Development (HUD) (Mr. Martinez).
  First, this Member would like to thank the distinguished gentlelady 
from Florida (Ms. Harris) for introducing this legislation. 
Furthermore, this Member would also like to thank both the 
distinguished gentleman from Ohio (Mr. Oxley), the Chairman of the 
House Financial Services Committee, and the distinguished gentleman 
from Massachusetts (Mr. Frank), the Ranking Member of this Committee, 
for their support in bringing this measure to the House Floor.
  One of the main obstacles for families who want to purchase a home is 
that they do not have the resources for a sufficient mortgage 
downpayment. As a response to this pressing need, this legislation 
would provide downpayment assistance grants to more than 40,000 first-
time low income families.
  The American Dream Downpayment Act would be administered as part of 
HUD's successful HOME program which currently provides grants to states 
and entitlement communities (over 50,000 in population) to use for 
affordable housing. This bill authorizes $200 million in new authorized 
funds to be used for downpayment assistance by states and entitlement 
communities. Furthermore, this bill would preserve the flexibility of 
the HOME program by allowing these states and localities to craft a 
package of downpayment assistance which meets their specific needs.
  Mr. Speaker, in closing, as a Member of the House Financial Services 
Subcommittee on Housing and Community Opportunity, this Member strongly 
supports H.R. 1276, the American Dream Downpayment Act. This Member 
encourages his colleagues to support H.R. 1276.
  Mr. OXLEY. Mr. Speaker, today, the House is considering H.R. 1276, 
the American Dream Downpayment Act. This important legislation, 
introduced by Reps. Katherine Harris and Mike Rogers, will help tens of 
thousands of low-income families to achieve the American dream of 
homeownership.
  The nation's overall homeownership rate is at an all time high of 68 
percent. However, the homeownership rate for African-Americans, 
Hispanic and other non-Hispanic minorities is approximately 49 percent. 
We can and must do better than this; H.R. 1276 will go a long way in 
helping to close this homeownership gap.
  For many families, the biggest barrier to homeownership is their 
inability to afford the downpayment and closing costs. While they can 
afford the monthly mortgage payments, they are unable to save the funds 
necessary for the downpayment and closing costs needed to purchase 
their first home. H.R. 1276 addresses this barrier by providing 
communities across America with $200 million in grants, which is 
anticipated to help more than 40,000 first-time low-income families to 
purchase their first homes.
  H.R. 1276 will be administered as part of HUD's HOME Investment 
Partnership Program, an existing program that helps communities 
increase the availability of affordable housing for families most in 
need through grants to state and local governments. The American Dream 
Downpayment Act preserves the flexibility of the HOME program, so that 
states can tailor assistance to best meet the needs of local citizens.
  H.R. 1276 has received the endorsement of: HUD Secretary Mel 
Martinez; America's Community Bankers; Consumers Bankers Association; 
Fannie Mae; Freddie Mac; Housing Assistance Council; Manufactured 
Housing Institute; Mortgage Bankers Association of America; National 
Association of Home Builders; National Association of Housing and 
Redevelopment Officials; National Association of Mortgage Brokers; and 
National Association of Realtors.
  When families own their own home, they become stakeholders in their 
communities. H.R. 1276 will increase the ranks of stakeholders and 
bring stability and a new spirit of revitalization to our communities. 
By helping families purchase their own homes, we can give them the 
wealth-building opportunity that homeownership provides. Hard-working, 
low-income families across the country will finally have an opportunity 
to profit from both the community and economic benefits that come from 
owning your own home.
  In addition to the many benefits for low-income families, 
homeownership helps to fuel the economy. People who own their homes 
spend money for home improvements. In fact, the housing industry itself 
has been one of the few bright spots in the national economy over the 
last three years.
  Passage of the American Dream Downpayment Act represents an important 
step in closing the minority homeownership gap. I want to again commend 
Representatives Katherine Harris, Mike Rogers, Chairman Ney and Ranking 
Minority Maxine Waters for their hard work on this important measure 
and urge my colleagues to support it.
  Mr. CASTLE. Mr. Speaker, I rise today to support the ``American Dream 
Downpayment Act.'' I thank Congresswoman Katherine Harris, Congressman 
Artur Davis, Congressman Mike Rogers and all the members of the 
Financial Services Committee for their hard work on this important 
bill.
  This legislation, which I am proud to have cosponsored, will help low 
and moderate income families purchase their first home. As Delaware's 
governor, I established a Housing Development Trust Fund that helped 
more than 5,400 low- to moderate-income families become homeowners. I 
am pleased to support this program which seeks to help more than 40,000 
first-time, low-income families achieve their dream of homeownership.
  We can be proud of the historic levels of homeownership we have 
reached in this country, we must also recognize that the number of 
people who pay more than half of their income in housing is also 
rising. We need to make our existing government housing programs more 
efficient and expand them through responsible programs that will help 
our constituents realize their dreams of homeownership. Equity in a 
home is the primary asset held by most American families and the best 
mechanism that families have for wealth creation.
  I have maintained a longstanding commitment to affordable housing and 
expanding homeownership, this legislation is a positive step in 
furthering that goal. Thomas Jefferson once said the happiest moments 
of his life were those which he had passed at home in the embrace of 
his family. Mr. Speaker, I am

[[Page 23816]]

pleased we are working to bring that sentiment to all Americans and I 
rise in support of this legislation.
  Mr. NEY. Mr. Speaker, I have no further requests for time, and I 
yield back the balance of my time.
  The SPEAKER pro tempore (Mr. Shaw). The question is on the motion 
offered by the gentleman from Ohio (Mr. Ney) that the House suspend the 
rules and pass the bill, H.R. 1276, as amended.
  The question was taken; and (two-thirds having voted in favor 
thereof) the rules were suspended and the bill, as amended, was passed.
  A motion to reconsider was laid on the table.

                          ____________________