[Congressional Record (Bound Edition), Volume 154 (2008), Part 4]
[Senate]
[Pages 4956-4979]
[From the U.S. Government Publishing Office, www.gpo.gov]




NEW DIRECTION FOR ENERGY INDEPENDENCE, NATIONAL SECURITY, AND CONSUMER 
PROTECTION ACT AND THE RENEWABLE ENERGY AND ENERGY CONSERVATION TAX ACT 
                           OF 2007--Continued

  The PRESIDING OFFICER (Ms. Klobuchar). The majority leader is 
recognized.
  Mr. REID. Madam President, we are in a situation that is hard for me 
to comprehend, but that is where we are. We have an amendment pending, 
the Durbin amendment, and we cannot get a vote. That is unfortunate.
  We have been told by the minority they want a 60-vote threshold. I 
cannot understand--there are a lot of people who have been in the 
Senate a lot longer than I have. But I do not know where we came up 
with a 60-vote deal.
  We should legislate. If someone on the minority side would offer a 
motion to table and that motion fails, they still are protected with 
the 60-vote margin. I do not understand why we cannot move forward on 
this legislation. It appears we cannot. It appears we cannot.
  It appears we have legislated our hearts out to try to arrive at a 
bipartisan arrangement. Let's go back and start at the beginning.
  Madam President, we offered a Democratic package. In good faith, 
Senators Dodd and Shelby, along with the Finance Committee chair and 
ranking member, came with a package for us. If you look at it, the only 
thing taken out of the Democratic package was the bankruptcy amendment. 
Many other provisions were changed drastically, but that was the only 
one that was taken out.
  Senator Durbin has offered to send it to the bill. During the 
negotiations, Senators Dodd and Shelby knew we on this side of the 
aisle wanted that bankruptcy amendment in the bill, so the minority 
would have to take it out. But negotiating in good faith, and 
recognizing that a legislator is someone who needs to be able to 
compromise, in the presence of Senator Dodd we agreed to take that 
provision out.
  That is where we are. We are not going to agree to a 60-vote margin. 
It is unfair. It is unfair that every time someone thinks they may 
lose, they want a 60-vote margin. I do not comprehend that. It has not 
been that way until the recent minority came into power, or lack of 
power, whatever the case may be.
  Today about 8,000 people will be told: You are out of your home 
forever. Someone else owns your home. Foreclosure is over with--Friday, 
tomorrow, another 8,000 people. Because of our inaction today and 
tomorrow, that is 16,000 people. Fortunately, foreclosure finalizations 
do not occur on weekends. That is standard law around the country. So 
we come back Monday. It is a nonvote day that has been scheduled for 
several months. That will be another 8,000 people. Now we are up to 
24,000 people and their families. I don't know how many it would add up 
to, but their families are out. So if on some phantom matter of 
principle the Republicans are going to say: You are going to have to 
get 60 votes on this, then I guess we will not have a bill. I ask my 
friends who have been in the Senate much longer than I why we have to 
do that.
  I think we are in an impossible situation. I admire, I have said many 
times, the good work done by Senators Dodd and Shelby. I have also said 
the substitute amendment that is before us is far from being perfect. I 
have had members of my own party say: Why did you give up on that or 
why did you add that? For example, Senator Shelby, why did we raise the 
downpayment to 3.5 percent? It was a compromise. The House wanted 1 
percent. People over here wanted 6 percent. We compromised. The whole 
substitute before us is a compromise. Legislation is the art of 
compromise. I would be satisfied if we walked out of this Chamber today 
with just the substitute amendment as having been agreed upon.
  Some think we have done too much for certain segments of society and 
we haven't done enough, on my side, for the middle class. ``Other 
side'' people think we have done far too much, that we should back off. 
Government is involved in this too much.
  I repeat, that is what legislation is all about. It is compromising. 
The American people are waiting for us to act. Someone please explain 
to me, I say to my friend, the Republican leader, why do we need to 
have 60 votes on every amendment that comes along? We have another 
amendment sponsored by Senators Feinstein and Martinez. There are some 
people who are concerned about that. They don't like it. It is a 
licensing provision. All kinds of special interest groups have weighed 
in on this. Should we have 60 votes on that? Senator Schumer has been 
somewhat aggrieved at both me and Senator Dodd because of a provision 
in here for counseling that is not $500 million. It is $100 million.
  It was a compromise. Our bill had $200 million. Senator Schumer 
wanted $500 million. But do we need to have 60 votes on that? If that 
is the case, we would not get 60 votes on anything.
  There may be a point that there are so many amendments offered that I 
would consult with the Republican leader and say: Well, maybe we need 
to file cloture on this bill. We have been here since 9:30 this morning 
on this bill, and we have not had a single vote.
  Again, through the Chair, I ask the distinguished Republican leader, 
why can't we move forward and try to dispose of, affirmatively or 
negatively, the Durbin amendment?
  The PRESIDING OFFICER. The Republican leader is recognized.
  Mr. McCONNELL. Madam President, with all due respect to my good 
friend the majority leader, this is somewhat of a manufactured 
controversy. Where are we? We have an underlying bill, negotiated on a 
bipartisan basis by Senator Shelby and Senator Dodd. Then we have, with 
all due respect to our friends on the other side, an expression of 
incredulity that 60 votes might be required for something in the 
Senate.
  Let me quote my good friend the majority leader who said last year:

       In the Senate, it has always been the case you need 60 
     votes. I don't have 60 votes.

  Senator Reid said in January of last year:

       Sixty votes are required for just about everything. We may 
     have to come up with a number of resolutions that require 60 
     votes.

  My point is--I say this with the greatest respect and admiration for 
my counterpart--acting like this is unusual is--well, it is clearly not 
the case.
  Why would Members on my side want to subject this proposal to a 60-
vote threshold? It is the most controversial provision in the bill. It 
is the principal reason my side was unwilling to go to the bill as 
previously crafted. So why would anyone feel aggrieved that the most 
controversial part of the bill, the issue which needed to come out in 
order to craft a bipartisan beginning, which Senators Dodd and Shelby 
did, why would anybody be incredulous

[[Page 4957]]

that 60 votes would be required for this? That is routine in the 
Senate. It is also frustrating to the majority. I was in the majority 
recently. But that is the way it is. To act like it is somehow unusual 
strikes me as somewhat odd.
  I would be happy to propose a unanimous consent request now, if the 
majority leader would like me to, that we have a vote on this amendment 
in the very near future at a 60-vote threshold. It is quite routine and 
common in the Senate. It would allow us to dispose of the Durbin 
amendment and move on to completion of the bill in the near future, 
something most of my Members would like to do. I assume, based on what 
my good friend said, that he would object to that, so I would not 
propose it, but I would be happy to. It would allow us to do what I 
think he wants to do, which is to go on and vote on the Durbin 
amendment and move ahead with amendments on both sides of the aisle.
  The PRESIDING OFFICER. The majority leader.
  Mr. REID. Madam President, I apologize. I was interrupted. Did the 
Senator make a suggestion? What was that?
  Mr. McCONNELL. I did not make a consent request. But I said I would 
be happy, if you would like me to, that we vote on the Durbin amendment 
shortly with a 60-vote threshold, which is pretty common around here on 
all matters of controversy. I was pointing out that this Durbin 
amendment is the most controversial part of the bill. Both sides knew 
that. I don't know why we don't have a vote at 60 like we do on 
virtually everything of controversy in the Senate. Then dispose of the 
Durbin amendment and move on.
  Mr. REID. I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. VOINOVICH. Madam President, I ask unanimous consent that the 
order for the quorum call be rescinded.
  The PRESIDING OFFICER. Is there objection?
  Ms. STABENOW. Madam President, there is an objection on behalf of the 
majority leader. I object.
  The PRESIDING OFFICER. Objection is heard.
  The clerk will continue to call the roll.
  The legislative clerk continued with the call of the roll.
  Mr. CHAMBLISS. Madam President, I ask unanimous consent that the 
order for the quorum call be rescinded.
  The PRESIDING OFFICER. Is there objection to dispensing with the 
quorum call?
  Without objection, it is so ordered.


                            Vote Explanation

  Mr. CHAMBLISS. Madam President, I was unavoidably detained on the 
last vote. Had I been present to vote on S. Res. 501, I would have 
voted in the affirmative. I would like to be recorded as such.
  The PRESIDING OFFICER. The Record will so note the Senator's 
position.
  Mr. CHAMBLISS. I thank the Senator.
  The PRESIDING OFFICER. The majority leader is recognized.
  Mr. REID. Madam President, I say to my friend from Georgia, we vote 
in a very hurried fashion lots of times. It is a wonder we do not make 
more mistakes. I have done the same thing the Senator from Georgia has 
done. You should not be embarrassed. It happens all the time. I am glad 
the Record reflects your feelings. We know your feelings on this issue.
  Mr. CHAMBLISS. Thank you.
  The PRESIDING OFFICER. The Senator from Illinois is recognized.


                           Amendment No. 4388

  Mr. DURBIN. Madam President, in the interest of moving forward this 
important housing stimulus bill as quickly as possible, I move to table 
the pending amendment and ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The question is on agreeing to the motion.
  The clerk will call the roll.
  The legislative clerk called the roll.
  Mr. DURBIN. I announce that the Senator from California (Mrs. Boxer), 
the Senator from New York (Mrs. Clinton), the Senator from Hawaii (Mr. 
Inouye), and the Senator from Illinois (Mr. Obama) are necessarily 
absent.
  Mr. KYL. The following Senators are necessarily absent: the Senator 
from Missouri (Mr. Bond) and the Senator from Arizona (Mr. McCain).
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The result was announced--yeas 58, nays 36, as follows:

                      [Rollcall Vote No. 88 Leg.]

                                YEAS--58

     Alexander
     Allard
     Barrasso
     Baucus
     Bennett
     Brownback
     Bunning
     Burr
     Byrd
     Carper
     Chambliss
     Coburn
     Cochran
     Coleman
     Collins
     Corker
     Cornyn
     Craig
     Crapo
     DeMint
     Dole
     Domenici
     Ensign
     Enzi
     Graham
     Grassley
     Gregg
     Hagel
     Hatch
     Hutchison
     Inhofe
     Isakson
     Johnson
     Kyl
     Landrieu
     Lieberman
     Lincoln
     Lugar
     Martinez
     McCaskill
     McConnell
     Murkowski
     Nelson (NE)
     Pryor
     Roberts
     Sessions
     Shelby
     Smith
     Snowe
     Specter
     Stevens
     Sununu
     Tester
     Thune
     Vitter
     Voinovich
     Warner
     Wicker

                                NAYS--36

     Akaka
     Bayh
     Biden
     Bingaman
     Brown
     Cantwell
     Cardin
     Casey
     Conrad
     Dodd
     Dorgan
     Durbin
     Feingold
     Feinstein
     Harkin
     Kennedy
     Kerry
     Klobuchar
     Kohl
     Lautenberg
     Leahy
     Levin
     Menendez
     Mikulski
     Murray
     Nelson (FL)
     Reed
     Reid
     Rockefeller
     Salazar
     Sanders
     Schumer
     Stabenow
     Webb
     Whitehouse
     Wyden

                             NOT VOTING--6

     Bond
     Boxer
     Clinton
     Inouye
     McCain
     Obama
  The motion was agreed to.
  The PRESIDING OFFICER. The majority leader is recognized.
  Mr. REID. Madam President, I had the good fortune in 1982 to be 
elected to the House of Representatives, one of the biggest thrills of 
my life. As a result of that, I have made some very good friends. One 
of the people who came in that class of 1982 was Richard Durbin of 
Illinois.
  What everybody here witnessed was an act of unselfishness. Senator 
Durbin procedurally moved to table his own amendment. That is unheard 
of in the Senate. He did that in an effort to move this along. He knew 
where the votes were. I want the Record to be spread with the fact that 
this is a fine legislator, a good human being. The people of Illinois 
are so fortunate to have this man who cares so much about people. In 
front of all of my colleagues, Democrats and Republicans, I express my 
appreciation to Dick Durbin for doing something that is unheard of 
here, something very unselfish, for which he gets no credit.
  Mr. KYL. Will the leader yield for a question?
  Mr. REID. Yes.
  Mr. KYL. Madam President, I served in the House of Representatives 
with the Senator from Illinois as well. This isn't the first time he 
has done something unheard of. I was in the minority in the House of 
Representatives and on a particular vote--I don't know how many were on 
the floor, but probably about a dozen altogether--Dick Durbin was in 
the chair as Presiding Officer. He called the vote--a voice vote. It 
was supposed to be ``the ayes have it,'' but there were a bunch of 
Republicans on the floor and, in full-throated voice, we said ``no.'' I 
think one timid soul said ``aye.'' The Presiding Officer said: ``The 
nos appear to have it, the nos do have it.'' He called the vote, but 
not the way his side of the aisle wanted it called. Of course, about 10 
minutes later, the appropriate number of people were on the floor and 
the vote was reversed. So this is not the first time the Senator from 
Illinois has done something unusual and in a way to move the process 
along and be fair in it. I always have appreciated that.
  The PRESIDING OFFICER. The Senator from Ohio is recognized--the 
Senator from Louisiana is recognized.
  Ms. LANDRIEU. Madam President, may I inquire about the order of 
amendments that will be offered? Is there an order?

[[Page 4958]]


  Mr. DODD. May I ask the Senator from Ohio to yield without giving up 
his right to the floor?
  Mr. VOINOVICH. Yes.
  The PRESIDING OFFICER. The Senator from Connecticut.
  Mr. DODD. Senator Shelby will be coming over shortly. A lot of 
Members have amendments they want to offer. We wish to obviously 
accommodate as many people as we can. I don't know what the leader's 
intentions are for this evening, but we will try to accommodate people 
and go back and forth in the normal process. We will be here while 
Senator Voinovich is offering his amendment. I know Senator Schumer is 
next in line. We will have to sit down and work out an order after 
that.
  Ms. LANDRIEU. Madam President, reserving the right to object--
  Mr. DODD. Reserving the right to object, I will try to accommodate 
everybody.
  Ms. LANDRIEU. My suggestion is that we get an order now.
  Mr. DODD. I am going to try to do that.
  The PRESIDING OFFICER. The Senator from Ohio is recognized.


                Amendment No. 4406 to Amendment No. 4387

  Mr. VOINOVICH. Madam President, I send amendment No. 4406 to the 
desk.
  The PRESIDING OFFICER. The clerk will report.
  The bill clerk read as follows:

       The Senator from Ohio [Mr. Voinovich], for himself, Ms. 
     Stabenow, Mr. Hatch, Mr. Rockefeller, Mr. Smith, Ms. 
     Cantwell, Mr. Vitter, and Mr. Levin, proposes an amendment 
     numbered 4406.
  Mr. VOINOVICH. Madam President, I ask unanimous consent that reading 
of the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

 (Purpose: To protect families most vulnerable to foreclosure due to a 
 sudden loss of income by extending the depreciation incentive to loss 
 companies that have accumulated alternative minimum tax and research 
                      and development tax credits)

       At the end of title VI, insert the following:

     SEC. ___. ELECTION TO ACCELERATE AMT AND R AND D CREDITS IN 
                   LIEU OF BONUS DEPRECIATION.

       (a) In General.--Section 168(k), as amended by this Act, is 
     amended by adding at the end the following new paragraph:
       ``(5) Election to accelerate amt and r and d credits in 
     lieu of bonus depreciation.--
       ``(A) In general.--If a corporation which is an eligible 
     taxpayer (within the meaning of paragraph (4)) for purposes 
     of this subsection elects to have this paragraph apply--
       ``(i) no additional depreciation shall be allowed under 
     paragraph (1) for any qualified property placed in service 
     during any taxable year to which paragraph (1) would 
     otherwise apply, and
       ``(ii) the limitations described in subparagraph (B) for 
     such taxable year shall be increased by an aggregate amount 
     not in excess of the bonus depreciation amount for such 
     taxable year.
       ``(B) Limitations to be increased.--The limitations 
     described in this subparagraph are--
       ``(i) the limitation under section 38(c), and
       ``(ii) the limitation under section 53(c).
       ``(C) Bonus depreciation amount.--For purposes of this 
     paragraph--
       ``(i) In general.--The bonus depreciation amount for any 
     applicable taxable year is an amount equal to the product of 
     20 percent and the excess (if any) of--

       ``(I) the aggregate amount of depreciation which would be 
     determined under this section for the taxable year if no 
     election under this paragraph were made and if this 
     subsection applied only to eligible qualified property, over
       ``(II) the aggregate amount of depreciation allowable under 
     this section for the taxable year.

       ``(ii) Eligible qualified property.--For purposes of clause 
     (i), the term `eligible qualified property' means qualified 
     property under paragraph (2), except that in applying 
     paragraph (2) for purposes of this clause--

       ``(I) `March 31, 2008' shall be substituted for `December 
     31, 2007' each place it appears in subparagraph (A) and 
     clauses (i) and (ii) of subparagraph (E) thereof,
       ``(II) only adjusted basis attributable to manufacture, 
     construction, or production after March 31, 2008, and before 
     January 1, 2009, shall be taken into account under 
     subparagraph (B)(ii) thereof, and
       ``(III) in the case of property which is a passenger 
     aircraft, the written binding contract limitation under 
     subparagraph (A)(iii)(I) thereof shall not apply.

       ``(iii) Maximum amount.--The bonus depreciation amount for 
     any applicable taxable year shall not exceed the applicable 
     limitation under clause (iv), reduced (but not below zero) by 
     the bonus depreciation amount for any preceding taxable year.
       ``(iv) Applicable limitation.--For purposes of clause 
     (iii), the term `applicable limitation' means, with respect 
     to any eligible taxpayer, the lesser of--

       ``(I) $50,000,000, or
       ``(II) 50 percent of the sum of the amounts determined with 
     respect to the eligible taxpayer under clauses (ii) and (iii) 
     of subparagraph (D).

       ``(v) Aggregation rule.--All corporations which are treated 
     as a single employer under section 52(a) shall be treated as 
     1 taxpayer for purposes of applying the limitation under this 
     subparagraph and determining the applicable limitation under 
     clause (iv).
       ``(D) Allocation of bonus depreciation amounts.--
       ``(i) In general.--Subject to clauses (ii) and (iii), the 
     taxpayer shall, at such time and in such manner as the 
     Secretary may prescribe, specify the portion (if any) of the 
     bonus depreciation amount which is to be allocated to each of 
     the limitations described in subparagraph (B).
       ``(ii) Business credit limitation.--The portion of the 
     bonus depreciation amount allocated to the limitation 
     described in subparagraph (B)(i) shall not exceed an amount 
     equal to the portion of the credit allowable under section 38 
     for the taxable year which is allocable to business credit 
     carryforwards to such taxable year which are--

       ``(I) from taxable years beginning before January 1, 2006, 
     and
       ``(II) properly allocable (determined under the rules of 
     section 38(d)) to the research credit determined under 
     section 41(a).

       ``(iii) Alternative minimum tax credit limitation.--The 
     portion of the bonus depreciation amount allocated to the 
     limitation described in subparagraph (B)(ii) shall not exceed 
     an amount equal to the portion of the minimum tax credit 
     allowable under section 53 for the taxable year which is 
     allocable to the adjusted minimum tax imposed for taxable 
     years beginning before January 1, 2006.
       ``(E) Credit refundable.--Any aggregate increases in the 
     credits allowed under section 38 or 53 by reason of this 
     paragraph shall, for purposes of this title, be treated as a 
     credit allowed to the taxpayer under subpart C of part IV of 
     subchapter A.
       ``(F) Other rules.--
       ``(i) Election.--Any election under this paragraph 
     (including any allocation under subparagraph (D)) may be 
     revoked only with the consent of the Secretary.
       ``(ii) Deduction allowed in computing minimum tax.--
     Notwithstanding this paragraph, paragraph (2)(G) shall apply 
     with respect to the deduction computed under this section 
     (after application of this paragraph) with respect to 
     property placed in service during any applicable taxable 
     year.''.
       (b) Effective Date.--The amendments made by this section 
     shall apply to property placed in service after December 31, 
     2007, in taxable years ending after such date.

  Mr. VOINOVICH. Madam President, along with my colleague from 
Michigan, Senator Stabenow, we have worked to craft an amendment to 
help struggling companies and their employees during this time of 
economic downturn. The two of us have been joined by a bipartisan group 
of cosponsors, including Senators Hatch, Smith, Vitter, Levin, 
Cantwell, and Rockefeller.
  Without a job and financial security, it is extremely difficult to 
keep paying your mortgage and keep your home out of foreclosure. A job 
is the first step in ensuring that Americans can achieve the dream of 
home ownership.
  My hometown of Cleveland is the epicenter of the foreclosure crisis, 
and with Ohio ranked No. 1 in foreclosures nationwide, according to the 
Mortgage Bankers Association, addressing this issue is of critical 
importance to me and all of my constituents in the great State of Ohio. 
The reason Ohio is experiencing a foreclosure crisis has nothing to do 
with speculators. It has to do with a bubble of rapidly rising prices. 
Ohio has a foreclosure crisis despite the fact that house prices never 
did increase there as they did in other parts of the country. Ohio 
families have been losing their homes because Ohio manufacturing 
workers have been losing their jobs.
  It is the same story next door in Michigan. Our amendment is one step 
in the plan to turn things around for workers in these and other 
manufacturing States so families have the income to stay in their 
homes.
  Our amendment will help unprofitable companies--many of which are in 
Ohio--to use existing AMT and R&D credits in 2008 to stimulate their 
businesses, turn profits, and create new jobs. The amendment would 
allow companies operating in the red to use the AMT and R&D credits 
already on their books instead of bonus depreciation deductions, as 
long as the money is used to expand operations in the United States.

[[Page 4959]]

  Bonus depreciation has already been included in the economic stimulus 
package, but it left out companies that don't have income against which 
to deduct their expenses because they are not making any money. This is 
an important thing. Ironically, these are the companies that are most 
in need of relief during a strained economy, but they are not receiving 
it.
  My colleagues should also note that this amendment is fiscally 
responsible because it simply allows for the speedier use of tax 
credits that would be used anyway in the future. In other words--and I 
wasn't aware of this--companies that are not making money pay an AMT 
corporate tax, and what happens is when they do start making money, 
they deduct the corporate AMT from the taxes, so in effect they get 
credit for that corporate AMT. We are basically saying let's let those 
companies--because they cannot use the bonus depreciation--use that AMT 
credit so they can create jobs and keep people working. So this 
basically lets them use these credits speedier than they would 
ordinarily be used if we waited over a longer period of time.
  I want everybody to know we will continue to work with the Joint 
Committee on Taxation to get a fiscally responsible revenue estimate. 
We have every reason to believe it is going to be very small during 
this 10-year period. As a matter of fact, if you take into 
consideration that these companies, down the road, would use the R&D or 
their corporate AMT, it could end up being a wash.
  This bipartisan amendment has wide-ranging support from the biotech 
industry, to the American auto industry, to the coal industry. All of 
these industries are hurting and need a boost to get back on track. 
This amendment would give them that boost to make investments now and 
create jobs so Americans can keep their homes. I urge my colleagues to 
support this amendment and work to protect their constituents' jobs and 
homes.
  I yield the floor to the Senator from Michigan, whom I appreciate 
joining me on this amendment. It is something the two of us have been 
working on for quite some time. I am glad we have a bipartisan group 
that understands how important it is to our respective States and to 
this country.
  The PRESIDING OFFICER. The Senator from Michigan is recognized.
  Ms. STABENOW. Madam President, I first give thanks to my colleague 
and friend from Ohio. We have been working together on this issue. 
Michigan and Ohio are part of the epicenter as we have seen the 
downturn in the economy since 2000. We have seen 3 million 
manufacturing jobs--middle-class jobs that created the standard of 
living in this country--that have been lost.
  This amendment addresses those companies that have done the right 
thing, that have paid good wages, provided health insurance, provided 
pensions, that now find themselves in a challenging time but that we 
want to continue to support so they can continue to keep great American 
jobs in this country.
  I am so pleased we are joined by others in a truly bipartisan effort. 
We have four Democrats and four Republicans cosponsoring the amendment. 
We have Senators Hatch, Rockefeller, Cantwell, Vitter, Levin, and Smith 
coming together from all parts of the country, representing important 
American industries that are asking to be recognized and to basically 
allow them to use the AMT and R&D credits they have already 
accumulated. They have made investments and we want them to make more, 
and we want to create a mechanism that allows them to benefit from the 
mechanisms we are putting into place to support industries that need 
assistance in this difficult time and need to be ready to come out of 
this economic downturn as quickly as possible.
  There is no question that we are in a housing and economic crisis in 
America. Few States have been hurt worse than Michigan and Ohio. In 
Michigan alone, right now, we rank No. 6 in the number of foreclosures. 
Last year, 87,000 households were foreclosed upon; 87,000 families 
faced the loss of their homes and their piece of the American dream.
  Last year, Michigan lost 62,000 good-paying jobs. Unfortunately, we 
are not alone. In February, the manufacturing sector lost 52,000 jobs. 
Over the last 7 years, manufacturing has lost more than 3.6 million 
jobs. Again, these are middle-class jobs and these companies have 
stepped forward to do the right thing and pay health care, pensions, 
and provide a standard of living that has been unsurpassed in the 
world.
  Yet the Labor Department announced that the number of new people 
signing up for unemployment benefits last week shot up to the highest 
levels in more than 2 years, from a seasonal adjusted 38,000 people to 
407,000 people.
  In Michigan alone, right now, our unemployment rate is 7.2 percent. 
American families are in a state of crisis. They are losing their 
homes, their jobs and, of course, we cannot ignore this situation. We 
need to do everything possible to be able to support families, workers, 
and businesses that are being affected.
  The Voinovich-Stabenow amendment would help save many of these 
important middle-class jobs and keep families out of foreclosure. From 
manufacturing States such as Michigan, families are not losing their 
homes because of a housing bubble, they are losing their homes because 
they lost their jobs, their livelihood. They have exhausted their 
unemployment benefits and they have spent all of their savings, 
probably dipped into the equity in their houses, and they cannot afford 
to pay the mortgages anymore. This is a daily reality for the families 
I represent in Michigan.
  The bonus depreciation provision we passed in the stimulus package 
earlier this year gave manufacturers a strong incentive to increase 
their capital investments in an effort to stimulate the economy. 
Unfortunately, that did nothing for manufacturers that are struggling 
the most right now, the ones that are not profitable, that are being 
forced to shut down plants and lay off workers.
  Our amendment would also give these struggling manufacturers an 
incentive to be here in America and invest in American jobs. By 
utilizing the AMT and R&D credit provision, manufacturers in this loss 
position that have built up AMT and research and development tax 
credits will now be able to use their credits, stimulate the economy, 
and create new jobs. These manufacturers will be able to recover their 
accumulated credits--in other words, they have invested and developed 
credits. They just cannot use them because they are currently not 
making a profit. This will allow them to recover those credits after 
they have made new investments, which will help them to fully realize 
the intended benefits of the bonus depreciation provision and put them 
on equal ground with profitable companies.
  This amendment will not only allow these manufacturers to stay afloat 
in this time of economic uncertainty, but will help them invest, 
expand, and create more American jobs. It will allow them to avoid 
laying off more workers, many of whom are the most vulnerable when it 
comes to the issue of foreclosure, losing their home.
  Adopting this amendment is an important first step in addressing the 
crisis facing our Nation. It cannot wait for another day. We would very 
much appreciate strong bipartisan support for this amendment that is a 
very important piece of addressing what is happening to so many 
millions of American families across this country.
  I urge colleagues to join us in this bipartisan amendment.
  The PRESIDING OFFICER. The Senator from Idaho is recognized.
  Mr. CRAIG. Madam President, I hope the tabling motion that the Senate 
has dealt with has broken the logjam and we can move to the amendments, 
such as the one we are now on, and work our way through the evening. 
The reason I say that is because there are a good many of us, well over 
a month ago, who said if you want to fix the economic trouble in our 
country today, solve the housing crisis.
  I did not agree with the stimulus package we debated a month ago. I 
did not agree with borrowing $150 billion and standing on street 
corners and

[[Page 4960]]

handing out $500 bills. That helps someone, but it does not help the 
economy in general because that money has not been handed out yet.
  What we do today, and if it were to become law in a reasonable period 
of time, would deal with one of the bigger industries in our country. I 
think few people, unless you look at it, recognize the value of the 
housing industry to our country, its breadth and its depth.
  One of the things I monitor in Idaho, and I know my colleague from 
Montana, who is on the floor, monitors as chairman of the Finance 
Committee is mill closures; that is, sawmill closures, across the 
United States since the first of the year because the timber industry 
is flat. It is at a 40-year low in prices of dimensional lumber.
  Why is it? Because the housing industry is flat. Talk to plumbing 
fixture manufacturers and everybody else out there and look at the 
breadth and the depth of the housing economy.
  So it is time we deal with the real problem. Had we dealt with it a 
month ago, possibly the House would have been done with it, it could 
have been signed into law, and, more importantly, it would be 
recognized in the marketplace today as a reality and the marketplace 
would be adjusting. That is the banking industry, that is the mortgage 
industry, that is the housing industry.
  There are real problems out there, and they are very real problems if 
you are involved in it. If you have been conned into a subprime loan 
and it sounded so good at the time you took it and it turned south on 
you and your values drop, that is one thing and you are out on the 
street or you simply walked because you used the ``credit card'' 
economy of the subprime market to buy a house.
  If I am across the street from you and you have left your house and 
the bank now has it and they knock it down 20 percent in the market, 
what does that do to the value of your home? You may be in better 
shape. You may have a fixed-rate 30-year mortgage. You may not be 
losing your job or you may not be in a subprime market, but your house 
went down 20 percent because the house across the street that is 
comparable went down 20 percent.
  That is the reality of the world in which we are playing, and that is 
why I was so extremely pleased when Senator Dodd and Senator Shelby 
came to grips with this issue in a very real, honest, brokered bill in 
a bipartisan way and have brought to the floor the bill before us. I 
hope the House will respond quickly, and we can get this to the 
President and it actually can become law in our timeframe so the 
markets can begin to react.
  Back at the time we were debating the $150 billion bailout, I and 
Senator Isakson and others said: Wait a moment, that is all well 
pleasing and it may be politically correct for the time and the White 
House and the majority party in the Congress may agree with it, but 
when will it get to the ground and how much will it stimulate?
  I had a lot of people in Idaho say: Larry, we are not going to buy 
anything; we are going to pay off the credit card debt; in other words, 
we are not going to move the money through the market in a way to 
stimulate the economy, we are simply going to put it in savings or pay 
off a debt. We are not going to go out and buy a new Chinese or 
Japanese television set or anything in the market that was not produced 
in our market that is oftentimes the kind of consumer product that kind 
of money buys today.
  So Senator Isakson and I said we ought to go back and look at history 
and what worked. In the seventies, we had a housing bubble, and it 
broke. The housing industry said we have a 3-year inventory. At that 
time--and I was not here; some who serve today were here--they put a 
tax credit out there, and they said: If you are going to be an owner 
occupant and you are going to buy out of inventory or repo or 
bankruptcy, you get the credit. What was supposedly a 3-year glut in 
the market of housing inventory turned into a 12- to 15-month glut, and 
the lights came on in our sawmills, workers went back to work, 
contractors went back to work, and we were able to effectively get that 
economy stabilized.
  In December of 2007, housing starts fell to the weakest level since 
May of 1991. As a whole, housing starts were down 24.8 percent in 2007, 
the second largest decline on record, and housing prices declined 
almost 9 percent in the final quarter of 2007, the largest year-to-year 
drop in a 20-year history of the index. That is what we were looking at 
in February and in January and saying to this Senate in a bipartisan 
way: Let's fix this problem; let's do it now; let's do it sooner rather 
than later.
  It is now later, and I wish it had been done earlier. But, most 
importantly, the Congress has recognized it, or at least the Senate has 
recognized it. Leaders such as Senators Dodd and Shelby have recognized 
it and they have come to an agreement. I hope we stick to that 
agreement.
  There are amendments floating around that ought not pass, and if they 
do pass, all of us will have to reevaluate the compromise because the 
compromise, in large part, is a bipartisan effort to solve this 
problem.
  We owe it to the American people this time to get it right, this time 
to fix the underlying primary problem that is dragging the economy 
down, threatening everyone out there in that industry, in the mortgage 
banking industry, and we ought to get it done in a way that makes it 
work.
  I believed all along that a timely targeted housing stimulus bill 
would focus on the builders and the buyers, and I think this housing 
legislation is workable and does that.
  Overall, I think it is a pretty good package, as I have said, and I 
will support it as long as we do not mess it up with more partisan-like 
amendments that might make their way to the final text.
  I believe in compromises when it is necessary and appropriate and 
when issues are as big as this issue is, when the problem is as big as 
this problem is, whether it is Boise, ID, or Las Vegas, NV, or San 
Diego, CA, or Seattle, WA, it is a problem that deserves to be dealt 
with in a timely and an appropriate way.
  Extending the carryback period for net operating losses will allow 
these companies, these builders to receive the infusion of cash helping 
them stay in business and pay their employees. The legislation will 
also help the buyer, as I have mentioned. We are proposing to provide 
additional money to tax-exempt private activity bonds authority to be 
used to refinance subprime loans which will keep families in their 
homes and make it easier for them, the home buyers, to buy that home.
  We are also going to allow taxpayers who do not itemize on their 
Federal taxes, which tends to be middle-class and lower income 
families, to deduct property taxes from their Federal tax liability. 
Frankly, that is a good deal. That makes sense in this interim period 
of time.
  Finally, the last tax provision in this legislation, in my opinion, 
is one of the most important provisions in the bill because it is the 
Isakson concept I listened to, helped develop, bought into very early 
on several months ago as we were looking at this problem, and that is 
giving taxpayers a $7,000 direct tax credit to buy homes that have been 
foreclosed on, payable over a 2-year period of time.
  Foreclosed homes are a significant problem in any housing market. For 
the reasons I explained a few moments ago, they drive down the prices 
of everybody else's values. They are oftentimes not maintained, they 
are attracted to vandalism and burglary, and they become eyesores in 
communities if banks and those companies that hold them are not doing 
the due diligence to make sure the lawns are mowed and the house is 
maintained and at least the house looks as if it is being occupied.
  Oftentimes, if there are too many in the market, that simply does not 
happen. This tax credit will help clear our housing inventory sitting 
in today's market. I talked about the seventies. There is no reason to 
believe we cannot clear the inventory in a reasonable period of time.
  Lastly, let me once again turn to Senator Dodd and Senator Shelby and

[[Page 4961]]

thank them. We are all partisan, but we are all bipartisan when we see 
big issues that deserve a solution, that demand it, and these two 
Senators stepped up and, in my opinion, have put a very good package 
together. It is certainly a package I wish to support, that I hope we 
can move in a timely and responsible way to conclude because it is, in 
my opinion, the greatest stimulus to the biggest problem in the economy 
today.
  In Idaho, a State that has experienced phenomenal growth over the 
last good number of years, those foreclosures are beginning to develop. 
But unlike some States, we have something else happening. We have 
sawmills going down and lights going out and hard-working men and women 
simply not having their jobs in the housing industry because the 
housing industry is flat.
  This kind of legislation, when it becomes law, will work in the 
marketplace to solve those problems and allow the markets to adjust in 
a way we ought to be allowing them to do, not to step in and fix it 
with a Federal bailout but to allow the markets to adjust, the buyers 
to adjust, and those who may have been victimized, in part, by the 
uniqueness of the loan packages of a few years ago, to make sure they 
can be helped a bit. But more importantly, they have learned their 
lesson that there is no free ride, that you cannot buy a house with a 
credit card, that a little savings and a little investment and a little 
fortuitousness can help you into probably one of the largest 
investments you will make in your lifetime and historically--and it 
will be true tomorrow as it was true yesterday--will be the best buy 
you have ever made in your lifetime and that is to own a home in a 
community of your interest and your support.
  I hope we can work this through the evening. I hope we can move to 
final passage with the quick handling of these amendments. It is 
important we get this work done and say to the American people: You 
see, when there is a big problem out there, the Congress can respond in 
a responsible way.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Connecticut is recognized.
  Mr. DODD. Madam President, I first thank the Senator from Idaho for 
his very generous comments about the effort. We appreciate that very 
much. His willingness to work with us will be of help to see if we 
cannot move this legislation along.
  I am going to ask consent to get a batting order of amendments. Madam 
President, we have already considered the Durbin amendment. We are now 
considering the Voinovich-Stabenow amendment. Following that amendment, 
Senator Murray and Senator Schumer have an amendment, Senator Specter--
I should refer to them by number. The Voinovich amendment is amendment 
No. 4406, the Murray-Schumer amendment is No. 4397, the Specter 
amendment is No. 4392, the Feinstein-Martinez amendment is No. 4393, 
and an amendment offered by Senator Kyl of Arizona is No. 4407. I ask 
unanimous consent that those amendments be considered in the order I 
announced them; that the underlying amendment, the Voinovich amendment, 
at the conclusion of debate, be set aside and we move to consider these 
next amendments. We will try to complete four or five of these 
amendments, I am told by the leadership, with the possibility of votes 
on one or all these amendments this evening, with a couple more 
tomorrow.
  The PRESIDING OFFICER. Is there objection?
  Mr. BAUCUS. Reserving the right to object.
  The PRESIDING OFFICER. The Senator from Montana.
  Mr. BAUCUS. I want to ask the chairman of the Banking Committee to 
read those amendments off one more time.
  Mr. DODD. Be happy to. Presently, we are considering the Voinovich-
Stabenow amendment, No. 4406. The next amendment would be the amendment 
offered by Senators Murray and Schumer, No. 4397. There is then an 
amendment offered by Senator Specter, No. 4392; an amendment offered by 
Senators Feinstein and Martinez, which is amendment No. 4393; and an 
amendment offered by Senator Kyl, No. 4407. There are other amendments, 
but these are the four or five we are going to try to deal with here by 
setting aside the underlying amendment and debating them.
  Mr. BAUCUS. I object, Madam President. There is one in there I don't 
want on that list, so I object.
  The PRESIDING OFFICER. Objection is heard.
  Mr. BAUCUS. It is the Ensign amendment. Take that off the list.
  Mr. DODD. It is not on there.
  Mr. BAUCUS. It is not on there? OK, good. I am okay as long as that 
amendment is not on there.
  The PRESIDING OFFICER. Is the objection withdrawn?
  Mr. BAUCUS. Yes.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DODD. May I also just request that Members let the staff know how 
much time they may need. It would help us to inform other people about 
when their amendments are coming up. So if you need a half hour, 15 
minutes, or whatever to explain your amendment, we can let others know 
about coming over and offering their amendments in a timely fashion.
  The PRESIDING OFFICER. The Senator from Montana.
  Mr. BAUCUS. Madam President, I believe the Voinovich amendment is the 
pending amendment. I have spoken to that amendment and at this point 
cannot agree to it. It costs about $3 billion over 10 years. I have 
spoken to the sponsors and asked them to rewrite that amendment and 
talk to the Joint Committee on Taxation to get the score down to about 
$1 billion, and they are working on that right now. I very much hope 
they can get that amendment down to a billion because then it would be 
in a much more acceptable form. But right now, the size and scope of it 
is just too large. And I think it is appropriate, when we consider 
these tax amendments, to be somewhat prudent when we consider them and 
not go overboard. I do believe the current scope of the Voinovich 
amendment is too large, and they are very agreeable and are working 
with Joint Tax in amending the language to get it down to about $1 
billion over 10 years.
  Mr. DODD. Madam President, if I may, since the Senator from Montana 
has spoken on this amendment, I wish to advise Members that any 
amendment that is within the jurisdiction of the Finance Committee, I 
am going to defer entirely to the Senator from Montana and his 
colleague from Iowa as to their advice and counsel. So if you have any 
amendment that impacts the Finance Committee, I am happy to see you, 
but I will turn you right over to see the Senator from Montana to talk 
about it. So I am going to make it clear we are going to rely entirely 
on the judgment of the Finance Committee on any amendments that affect 
that committee.
  Mr. BAUCUS. Thank you very much.
  The PRESIDING OFFICER. The Senator from Washington.


                Amendment No. 4397 to Amendment No. 4387

  Mrs. MURRAY. Madam President, I ask unanimous consent to set aside 
the Voinovich amendment in order to call up amendment No. 4397.
  The PRESIDING OFFICER. Without objection, it is so ordered, and the 
clerk will report.
  The bill clerk read as follows:

       The Senator from Washington [Mrs. Murray], for herself, Mr. 
     Schumer, Mr. Casey, and Mr. Brown, proposes an amendment 
     numbered 4397.

  Mrs. MURRAY. Madam President, I ask unanimous consent that further 
reading of the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

    (Purpose: To increase funding for housing counseling resources)

       On page 58, line 10, strike ``$100,000,000'' and all that 
     follows through ``2008'' on line 11, and insert the 
     following: ``$200,000,000, to remain available until December 
     31, 2008''.

  Mrs. MURRAY. Madam President, I offer this amendment for myself and 
Senator Schumer, Senator Casey, and Senator Brown.

[[Page 4962]]

  I am extremely happy that we do have a bipartisan bill now that 
provides a solution to the problem at the very center of our Nation's 
economic downturn--the housing crisis--that has shaken communities 
across this country. We know that each month this year thousands of 
homeowners will see their interest rates rise, and many more will find 
themselves underwater as the housing market in their region continues 
to suffer. If the Federal Government doesn't take action, as many as 2 
million American families are going to lose their homes to foreclosure 
this year. Each one of those foreclosures represents a family whose 
dream of a comfortable home and a secure future is going to be dashed, 
and each one of those foreclosures really weakens the foundation of a 
community.
  This crisis has already rippled across our economy. If we don't take 
aggressive steps to prevent it from becoming worse, it is going to take 
that much longer for our neighborhoods and our hometowns to recover. 
That is why I rise this afternoon to offer an amendment with Senators 
Schumer, Casey, and Brown which I believe will help make this bill much 
stronger. Our amendment will provide an additional $100 million for 
housing counselors, who really are our front line of defense in the 
fight to prevent more families from losing their homes. What our 
amendment does is double the money for housing counseling that is in 
this bill. It builds on our efforts we started last year.
  In last year's omnibus budget, we included $180 million through the 
NeighborWorks America Program for housing counseling to help 450,000 
homeowners who are in trouble today. As chairman of the Appropriations 
Subcommittee on Transportation and Housing, I worked hard with my 
colleague, Senator Bond, to push for that money. The bill before us 
today would provide the resources to help another 250,000 homeowners, 
and our amendment would enable us to bring the total number of families 
helped through this bill to 500,000.
  Many homeowners today don't know that they can get help if they get 
behind on their mortgage. Too many of them don't make contact with 
their lender when they miss their first payment, and too many just feel 
intimidated or don't trust their bank enough to make a call. But 
housing counselors can help these families. They can help them 
negotiate with their lender, readjust their payment, or learn how to 
budget their expenses better.
  The last couple of years have really proven that this kind of 
assistance may be the most cost-effective and important piece of the 
solution to the housing crisis, and that is why we believe we must 
ensure that counseling agencies get more resources as soon as possible 
if we are going to turn around this economic crisis.
  According to the Secretary of Housing and Urban Development, 96 
percent of the families who get counseling avoid foreclosure. Let me 
say that again. Ninety-six percent of the families who get counseling 
avoid foreclosure. That means almost all the people who seek help from 
an expert will not lose their homes.
  We know the demand is there. Last year, the demand for the $180 
million made available for counseling in the omnibus was twice as high 
as the money available, and that happened even though counseling agents 
across the country had only 2 weeks last year to apply for the grants. 
In just the couple of months that have passed since then, several 
States have seen a dramatic increase in their foreclosures, and people 
in those communities and other communities across the country are very 
worried. We all know that foreclosures have left our neighborhoods full 
of vacant homes. Families are distressed, they are in trouble, and 
State and local governments are seeing their tax revenues drop now, 
even as the needs out there are piling up.
  These counseling agencies we provide the funding for are telling us 
they need desperately more resources to help address this. In my home 
State of Washington, the number of calls to counselors doubled in just 
the first few months of this year, and we know that is true across the 
country. But if the numbers aren't compelling enough, let me tell you 
personally about a few people I know who have been helped.
  One of them is a man named Clifford. He is a gentleman from my State, 
and I don't want to use his last name to protect his privacy, but he 
told me what happened to him. He and his family thought they had 
achieved the American dream by owning a home. Their home represented 
stability. It was an important investment in their future. But they 
started having trouble with their mortgage because Clifford lost his 
factory job, and pretty soon his wife got sick and she needed surgery. 
Before they knew it, they were a couple of months behind and were 
struggling with their mortgage company about how they could ever catch 
up. They turned eventually to Consumer Counseling Northwest, got a 
counselor who gave them help and advice, and he told me that made all 
the difference. Clifford's housing counselors were able to help him get 
his payments reduced, and now his family has been able to pay the 
mortgage and keep their home.
  Madam President, there are many families like Clifford's across the 
country--people who are teetering on the edge and just need a little 
bit of help and counseling to avoid a crisis.
  Earlier this year, at an event with Senators Bond and Cochran--and 
with Representatives Olver and Knollenberg from the House--I had an 
opportunity to meet a single mom from Ohio. She told us she had fallen 
on very hard times, which in turn led her to fall behind, and she soon 
found out she couldn't pay her mortgage. But thanks to help from 
NeighborWorks America, she told us that she and her children didn't 
lose their home and they were able to stay there. She told me that when 
she got behind, she just got completely overwhelmed. She told me she 
didn't know what to do. She said: You know, this is not something they 
teach you in school.
  Well, these counselors made a difference in her life and thousands of 
others. We should not turn our back on families today who want to make 
a call and get help, who want to get their mortgages back in line and 
keep their homes. The economic health of this country depends on 
Americans having a safe and stable place to live and raise their 
families. We want every family who is facing a challenge today to know 
that there is help out there, and when they call, we want to make sure 
there is a knowledgeable counselor on the other end of the line who can 
give them the help they need.
  So here is the bottom line. We know we have millions of people who 
need help, and we know housing counseling can make a difference. So I 
think it would be unconscionable not to provide this money, and I urge 
my colleagues to support this amendment that will put the resources out 
there to make sure families in all our communities can pick up their 
phone, make a call, get the help they need, and keep their investment 
in their home and their security for the future.
  Madam President, I have been proud to work with the Senator from New 
York, as well as others, on this bill, and I know he is on the floor 
and ready to speak as well.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from New York is recognized.
  Mr. SCHUMER. Madam President, I am proud to rise in support of the 
amendment offered by the Senator from Washington, the Senator from 
Pennsylvania, the Senator from Ohio, and myself, and I first wish to 
thank Senator Murray for her leadership on this issue. This is crucial, 
and when Senators Casey, Brown, and I sent her a request to include 
this money first in the appropriations bill and then in the omnibus 
bill, Senators Dodd and Bond offered an amendment for another $100 
million, and by the time we got through with conference, $180 million 
was offered. So I thank all my colleagues. We also have Senators 
Clinton, Menendez, and Kerry as cosponsors of our amendment.
  Madam President, as you know, we are in the midst of a massive spike 
in mortgage delinquency and foreclosures. Housing prices are going

[[Page 4963]]

down at record levels. We haven't seen housing prices go down this much 
since the Depression. Our economy, the national economy, is heading 
south. Yet where is the President? The President has been in Bucharest, 
both literally and figuratively. The President is literally in 
Bucharest today, but he has been in Bucharest for months when it comes 
to the economy and housing. He is nowhere to be seen here.
  Foreclosure filings are soaring. They are up 57 percent in January. 
From December to January alone, foreclosures increased 8 percent. The 
57-percent figure is over the year. Home foreclosure filings topped 1.3 
million in 2007, and more than 2 million are likely now. We are all 
more than aware of the havoc this has wreaked in neighborhoods, on Main 
Street, on Wall Street, and throughout the Nation and even the world. 
So it is amazing that with all of these problems rippling out from 
housing foreclosures, a simple addition could greatly ameliorate the 
problem, and that addition is mortgage counselors. Why, you ask? Why 
should a mortgage counselor help solve not just problems of individual 
foreclosures but of declining home prices and declining economy and 
financial ripples throughout the world, in London and Shanghai? The 
answer is simple: The majority of those in foreclosure do not have to 
have their houses foreclosed upon. They have the resources, and the 
price of their home is such that a simple refinancing would work.
  In the old days--when banks were the only issuer of mortgages, they 
issued them and held them--none of this would have happened. The 
mortgage counselor from the bank would have gone over to the homeowner 
and helped him or her rework this. Madam President, 60 percent of those 
in foreclosure or about to go into foreclosure are prime borrowers; 
most of them, the majority, are in home refinancings, not new homes; 
and many of them were duped through no fault of their own.
  A mortgage counselor on the scene, provided there are dollars to 
refinance, can help that homeowner refinance.
  I ask unanimous consent that Senator Klobuchar, the Presiding 
Officer, be added as a cosponsor of our amendment.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. SCHUMER. I thank her for always being on top of things.
  In any case, a mortgage counselor could easily do the job in so many 
cases, but there are none around. Foreclosure counselors are skilled 
and work. There are groups throughout the country that do this and do 
it well, with very little waste and much dedication. That is why 
Senators Casey, Brown, and I went to Senator Murray and asked her to 
put this in the omnibus bill. That is why she did it, and that is why 
Senators Bond and Dodd added additional money in an amendment. We need 
these people.
  I wish to tell a story. I have told it before on this floor, but I 
want to make sure people hear about it. It shows the need for 
counselors. It is about Frank Ruggiero, a homeowner from Ozone Park in 
Queens. Frank is a retired subway motorman. He had a pension of $28,000 
a year, Social Security of $11,000 a year--$39,000 income a year. He 
lived in his nice little brick house with a mortgage of $1,100 a month 
or about $12,000 a year and happily paid the mortgage for 16 years of 
the 30-year mortgage.
  Then Frank got diabetes. He needed $50,000 for some kind of treatment 
that his medical plan would not pay for. Instead of going to the bank, 
which was Frank's mistake--because banks have not caused this problem; 
it is the independent mortgage companies, unregulated, that caused it--
he saw an ad in the paper for one of these fiends--they are not all 
fiends but this person was-- that said ``get quick cash; refinance your 
home.''
  Frank called, and he came over. Frank said: How much more will I pay?
  He said: You will pay $100 more in January.
  And Frank says: I can easily afford $1,200 a month to cure my 
diabetes. That is worth it. He signed a new 30-year mortgage and sure 
enough, his mortgage only went up to $1,200 in January.
  What he was never told was that the following January his mortgage 
would go up to $3,900 a month. That is easy math. That is about $47,000 
a year. Frank's total income was $39,000 a year. Even if he didn't pay 
one nickel for the whole year for any food or heat or taxes, he 
couldn't pay it.
  What happened? This more relates to the amendment of my colleague 
from California--the mortgage broker was paid a huge commission to dupe 
Frank. He duped him legally because there are no regulations. It said 
on the big document Frank signed, on page 23--I am a lawyer, but I 
couldn't understand it--6 points above LIBOR after 4 months, after 
this, after that--it said the mortgage would go up that much, but no 
right person would understand it. It wasn't in plain English, and it 
wasn't available. The mortgage broker made a huge fee, walked off into 
the sunset, and Frank was about to lose his home.
  The irony is, Frank was a prime borrower. He had never missed a 
payment on his mortgage, he had never missed a payment on his credit 
card. His FICO score was above 700. He easily could refinance. Frank is 
a good customer for a lending institution. But there was no one to help 
him. There was no bank. It was a mortgage broker, independent, who got 
money from a mortgage company, independent, both unregulated. That 
relates to the amendment of my friend from California. They are off 
into the sunset with their profits, and Frank is stuck and no one is 
there. The mortgage company didn't hold the mortgage, they chopped it 
up in 40 pieces and gave it to some investment house that sold 
securities, and it is now scattered among thousands of investors in 
little tiny pieces in different degrees of reliability.
  So Frank is out there alone. If there were a mortgage counselor on 
the scene, that mortgage counselor could easily help Frank refinance.
  You say, where would they get the money for refinancing? Good news; 
finally, after months of prodding by myself and Senator Dodd and 
others, Fannie Mae and Freddie Mac have made $200 billion available for 
these kinds of mortgages.
  But the dollars are not going to walk over to Frank's house in Ozone 
Park, Queens, and say: Here we are. You need a mortgage counselor. And 
that is what the amendment of the Senator from Washington and the 
Senator from Pennsylvania and the Senator from Ohio and my amendment 
does. It simply provides more mortgage counselors. It is not huge 
science. You do not need a Ph.D. in mathematics or an accounting degree 
to be a mortgage counselor. You have to take a little course and learn 
it. It is easy for the various groups that have done this for years but 
were not faced with a flood of foreclosures to do it again. We could 
probably prevent about 50 percent of all the foreclosures that are 
about to happen, maybe even more, because 60 percent are prime 
borrowers, and even some of the nonprime borrowers could be helped by 
this, depending on the value of the home and the cost of their mortgage 
and the mortgage processing agreement.
  That is all we want to do. In this package originally that we offered 
about 3 weeks ago, there was $200 million. That is not enough. Senator 
Murray and I and others wanted to ask for $500 million, but we were 
asked by the majority leader to keep the cost down so we offered $200 
million. Madam President, $200 million is not enough. We need more than 
that.
  We did appropriate $180 million in the omnibus bill, as I mentioned 
before, that Senator Murray put together--at least her part of it. Now 
there is talk we don't need the $180 million; they have not even spent 
that. Why give them more?
  Here is a letter. I ask unanimous consent the letter be printed in 
the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:


[[Page 4964]]


                                                    April 2, 2008.
     Hon. Christopher Dodd,
     Chairman, Senate Committee on Banking, Housing and Urban 
         Affairs, U.S. Senate, Washington, DC.
     Hon. Richard Shelby,
     Ranking Member, Senate Committee on Banking, Housing and 
         Urban Affairs, U.S. Senate, Washington, DC.
       Dear Chairman Dodd and Ranking Member Shelby: As you 
     consider the current housing stimulus legislation we urge you 
     to restore essential funding for foreclosure prevention 
     counseling. We respectfully request that you fund this 
     program for not less than $200 million as was initially 
     proposed by Senator Reid in S. 2636.
       As you well know, the nation is experiencing a serious 
     spike in mortgage delinquency and foreclosures. In 2006 more 
     than 1.3 million homes were in default, up 42 percent from 
     the year before. Foreclosures are expected to be greatest in 
     2008 when one in three loans is predicted to end in default 
     as a result of mortgage payment resets on adjustable rate 
     loans. The crisis is widespread and not just confined to the 
     urban housing market. Increasingly, rural borrowers are 
     subject to harsher prepayment penalties and targeted lending 
     discrimination so the prosperity and stability of rural 
     counties, like their urban and suburban counterparts, is 
     becoming jeopardized.
       The FY 2008 HUD Appropriations Act provided $180 million 
     for use by the Neighborhood Reinvestment Corporation to 
     provide mortgage foreclosure prevention counseling. 
     Neighborhood Reinvestment received applications for $340 
     million in grants to combat the foreclosure crisis. With only 
     two weeks to apply for funds, demand was nearly twice the 
     $180 million that Congress appropriated for these mitigation 
     activities. Several states were underrepresented in the 
     applicant pool, in part because those states had not seen 
     high rates of foreclosure up to that point. Now, however, 
     many of the states that did not apply or receive an initial 
     grant have seen a dramatic increase in home foreclosures and 
     are in desperate need of these supplemental counseling 
     resources.
       In particular, there is a need to expand the capacity of 
     housing counselors to assist delinquent homeowners with 
     accurate and honest information and options, budget and 
     workout plans, loan modifications, refinancing or responsible 
     sales of the residence. It is also essential given the nature 
     of this crisis to ensure an ongoing, adequate level of 
     support for mortgage foreclosure activities.
       We urge you to fund the foreclosure mitigation counseling 
     program at no less than $200 million in order for housing 
     counselors to keep pace with rising rates of foreclosure in 
     rural and urban neighborhoods. Thank you for your 
     consideration of this important request.
           Sincerely,
     Peg Malloy,
       President, NNA.
     David C. Brown,
       Executive Director, NNA.

  Mr. SCHUMER. It is a letter dated yesterday, to Senator Dodd and 
Senator Shelby, signed by about 100 organizations that do this, saying 
the following:

       We respectfully request that you fund this program for not 
     less than $200 million as was initially proposed by Senator 
     Reid in S. 2636.

  They said they have received applications for $340 million in grants, 
twice the $180 million Congress appropriated. Several States were 
underrepresented in the original applicant pool because they had not 
seen high rates of foreclosure, but now many of them have applied. Of 
the $180 million, $130 million has already been spent in a short 6 
weeks. The only reason the rest has not been spent is they are keeping 
it aside for a very rainy day. They could spend that in a minute if we 
were to ask them to in report language, should this bill get that far, 
which I hope and pray it does.
  So we need the money. It is not much money. We are putting $4 billion 
in for CDBG. That is worthy, but it is not as important as mortgage 
counselors. We are putting $6 billion in for the loss carryback 
provisions, the FOLs, to help homebuilders. We can't afford a needed 
$100 million more for mortgage counselors, who do more good to prevent 
foreclosure and provide more bang for the buck than any other part of 
this bill, bar none?
  Why the $100 million was cut out--I was told they said they didn't 
need it. This letter proves conclusively they need it. It is now in the 
Record. I urge my colleagues to look at it. We desperately need it.
  I hope we will have bipartisan support for this amendment. Senator 
Bond, who has been a leader on these issues, supported the amendment, 
with Senator Dodd, to put in the original $200 million. This is hardly 
a partisan issue. This is not a bill that costs $15 billion. Another 
$100 million is not going to make that much difference, especially when 
we are doing $6 billion for the loss carrybacks, and $4 billion for 
CDBG. I urge my colleagues to support it. It is a much needed amendment 
that will do tremendous good. It will help the Frank Ruggieros and the 
millions of others like him to keep their homes. It will prevent 
housing prices in their neighborhoods and in the country from declining 
more than they have to. It will stabilize mortgage markets and thus 
stabilize many of our largest banks and institutions, both here and 
abroad.
  So this little amendment is like Mighty Mite--it is small, it is at 
the center, but it has tremendous power to ripple outward and affect us 
positively.
  I urge my colleagues on both sides of the aisle to support it so we 
might strengthen this bill.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from California is recognized.
  Mrs. FEINSTEIN. Madam President, I do not see anyone on the 
Republican side on the floor, although if they are coming, now would be 
a good time. I believe Senator Martinez and I are up, after a 
Republican, for an amendment. I am prepared to proceed.
  Madam President, although I spoke about this amendment this morning, 
I wish to speak about it again. This amendment is called the SAFE 
Mortgage Licensing Act, ``licensing'' being the dispositive word. I am 
very proud to work with this with Senator Martinez of Florida. He is on 
his way and he will be making a statement following mine. This 
amendment is cosponsored by Senators Boxer, Obama, Dole, Durbin, 
Salazar, and Clinton.
  One of the things I didn't realize is how big scams are a part of the 
subprime market. I remember picking up a USA Today newspaper in January 
and the headline reading, ``Housing Scams Rising, FBI Says. 2007 
Convictions More Than Doubled.''
  As we began to look at this, we found there was a very real problem. 
The problem is that there is but a thin patchwork of State regulations. 
They vary. Some do not have any. Some are pretty good; some are not so 
good. So we put together this bill, Senator Martinez and I, and I am 
very proud to say it is supported by the National Association of 
Mortgage Brokers, by the Conference of Bank Supervisors, by the mayor 
of Los Angeles, and by the National Association of Realtors. I wish to 
read, if I might, the realtors letter because I think it is important 
to the discussion.

       On behalf of over 1.3 million members of the National 
     Association of REALTORS, I want to share our views on the 
     SAFE Mortgage Licensing Act offered by Senators Feinstein and 
     Martinez.
       We believe this amendment will go far towards preventing 
     another subprime market failure that would further erode 
     confidence in the Nation's housing finance system. While 
     responsible subprime lenders have played an important role in 
     helping millions of consumers achieve homeownership, abusive 
     subprime lending has occurred much too often. As a result, 
     roughly 2.2 million American households have been projected 
     to lose their homes, and as much as $164 billion due to 
     subprime mortgage foreclosures.
       Many of the provisions of the amendment are consistent with 
     NAR's ``Responsible Lending Principles.'' We believe our 
     principles provide an appropriate basis for legislation that 
     would help eliminate irresponsible practices such as making 
     loans without sufficient regard to the borrower's ability to 
     repay the loan and avoid foreclosure.
       The National Association of REALTORS supports responsible 
     lending, mortgage servicing, and appraisal practices. We 
     support this amendment that will help close the door on 
     abusive lending practices.

  I wish to say on behalf of the cosponsors of this amendment and 
myself, thank you to the National Association of Realtors.
  We are very grateful for the support. The fact is, mortgage fraud 
complaints have jumped more than 700 percent over the last 5 years, 
from 5,623 in 2002 to 46,717 last year. Mortgage fraud complaints in my 
State, California--Senator Boxer's and my State--have increased 400 
percent over the last 5 years, from 1,143 in 2002 to 4,060 last year.
  All you have to do is take a look at the jump in these complaints and 
the

[[Page 4965]]

jump in convictions to know there are scams going on and we need to 
stop them. The best way to stop them is to license these brokers and 
lenders so we prevent the 25-year-old scam artist--I do not pull this 
out of the air; this is a fact--who can come in, get on a telephone, 
and tell lenders or tell individuals what they can do to refinance 
their house and do it all in a bogus manner.
  We have 10 States that are mortgage fraud hot spots in the United 
States. They are California, New York, Texas, Florida, Georgia, Utah, 
Illinois, Indiana, Ohio, and Michigan. These are mortgage fraud hot 
spots because of the number of complaints and convictions of mortgage 
fraud coming from these States. So the time has come to do something 
about it.
  Now, there are some people in this body who say: Do not pass this 
bill today; put it in regular order. Let it go to the committee.
  Let it go to the committee, and it will be another year before this 
bill is before us. And I will bet any amount of money the mortgage 
fraud will continue because all of the conditions are ripe for it.
  The only way to handle it is to pass this bill so we set into motion 
some minimum national standard and allow the States to carry out this 
minimum standard and add to it anything the States might want.
  As I say, the 1.3 million-member National Association of Realtors is 
in support of this amendment. And the group that regulates them is in 
support of the amendment as well. Today, subprime mortgages are 30 
percent of all the mortgages in the largest State in the Union. Thirty 
percent of every mortgage is subprime in California. This is a 
community because they are mainly working class, not necessarily 
college graduates, who are eager pawns for bad actors in the mortgage 
and lending business.
  Now, having said that, not all brokers are bad actors; many of them 
are honorable professionals. The fact is, this is a profession. This is 
what you do as a mortgage broker, as a lender.
  You should have standards. You should have to pass a test. You should 
have to get a license, and you should have to renew that license 
periodically. How else can you be able to go out, get on a phone, call 
people and say: Look, I can refinance your house at 4 percent. You 
bring in the eager homeowner, and then the reality is something very 
different.
  These bad actors must be stopped. There is only one way to stop them; 
that is, have minimum Federal standards, allow the States--and in my 
State it would be the Corporation Department that would do this, that 
sets up the licenses, that sets up the training. And individuals would 
go through the training, they would have their background checked, they 
would get a license, and the license would go up for renewal annually.
  Some object to it. My goodness, attorneys have to renew their 
licenses. Why not someone who puts out mortgages which is very often 
everything an individual owns? Why is it not important for them to have 
a license and have that license renewed?
  Once again, I would like to tell you about this family. I do so 
because I met them in Los Angeles last week. This is the Simmons 
family. Look at their house. It is not a mansion. It is a one-story, 
well-kept stucco home with flowers planted, bushes trimmed.
  The gentleman, Mr. Simmons, was an employee of Northrop Grumman for 
20 years; his wife employed as a food checker at Alpha Beta for 26 
years. They have owned this home for 39 years. Mr. Simmons had a 
stroke. They found they needed cash. They received a cold call, a phone 
call from somebody. They wanted $500,000, to be able to get a loan, 
take this out, use it for medical expenses.
  They offered them a $629,000 loan with $25,000 cash back, 4.5 percent 
interest rate, and monthly payments of $2,000. Now, they are not 
college graduates. These are working people who did everything they 
could to buy a home, who have kept that home up for 39 years in good 
condition, and who today are going to lose that home.
  And here is why: There was no cash back, different from what they 
were promised. The interest was 11.2 percent on this loan. The monthly 
payments were not $2,000 as they were told; it was $5,300. When they 
had to make the first payment, they called the broker and said: You 
told us $2,000. Why is it $5,300?
  The broker said: It is only that for 4 months, to draw down the 
interest rate.
  They said: Ok, I guess we can do it for 4 months. It was not only for 
4 months, it was for the length of the mortgage. And the broker walks 
off with a $20,000 fee.
  Now, in my book this is fraud. There are some who say: Oh, people get 
the papers. Let them read through them.
  You have bought a home, Mr. President. I have bought a home. I did 
not read all of the fine print on all of the documents. I depend on the 
word of the broker. And I believe most people do that.
  Now, I am not a lawyer. I do have a college degree. What if I only 
had a high school degree or not even that? I worked all my life. I do 
not understand the fine print. This is why you have professionals 
representing you to tell you the truth.
  There is a penalty--should be--if they do not tell you the truth. 
Buying a home should not be a scam. Refinancing a home should not be a 
scam. So we then went on the Internet. Let's see what companies 
advertising to employ brokers say. And here is one of them. Here is the 
source. We accessed it on February 27 for brokers: No experience, 
education, or exam is necessary. No experience, education, or exam is 
necessary.
  They go on to say to the company: You can hire unlicensed sales 
agents to originate loans under your company license.
  I do not think they should be able to do that because it is these 
people who pick up the phone and call the homeowners and offer that 
second mortgage. Particularly in the subprime market, where many people 
have very little, if any, downpayment, this presents enormous 
difficulty.
  Consequently, we have a real problem. I hope this amendment passes 
today. Perhaps some people do not like this or that. It can be worked 
out in conference. But when we are passing this bill, we ought to pass 
something that says once and for all the Federal Government is willing 
to step in, set minimum standards; you, the State, set up your laws, 
set up your licensing requirements. These are the minimum standards, 
and you can add to them and see that those people, mortgage brokers and 
lenders, are licensed.
  The legislation also creates a database so that I, Joe Doe, about to 
buy a house, can go into my computer, if I have one, and see that my 
mortgage broker is licensed, know that he has been to school, know that 
he has been informed of ethics, know that he does not have a felony 
background right now, you can have a felony background--and know that 
his license is renewed annually so he is kept up to date on ethics and 
best practices.
  This industry, real estate, because it controls such a large 
proportion of most people's wealth, their homes--their home is their 
rock. Everything flows from that home ownership. And for most people 
buying a home is truly the American dream. Owning, having that equity, 
building that equity over the years, being able to finance retirement 
from the equity in a home when they choose to sell it is such a big 
deal. And to have bad actors, flim-flam artists going around suckering 
in people makes me angry. So I would hope this body, on behalf of 
Senator Martinez and me, will be willing to pass this legislation 
today.
  I ask unanimous consent to add Senator Klobuchar as a cosponsor.
  The PRESIDING OFFICER (Mr. Whitehouse). Without objection, it is so 
ordered.
  Mrs. FEINSTEIN. I ask unanimous consent to add to the Record letters 
from the State Bank Supervisors and the National Association of 
Mortgage Brokers in support of this amendment.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:


[[Page 4966]]


                                                     Conference of


                                       State Bank Supervisors,

                                    Washington, DC, April 3, 2008.
       Dear Senator: The Conference of State Bank Supervisors 
     (CSBS) supports the Secure and Fair Enforcement for Mortgage 
     Licensing Act of 2008 (S. 2595 the SAFE Mortgage Licensing 
     Act of 2008) introduced by Senators Feinstein and Martinez.
       The SAFE Mortgage Licensing Act of 2008 will help protect 
     borrowers from unscrupulous lenders and brokers and improve 
     transparency in the mortgage lending process. CSBS encourages 
     Congress to include this bipartisan reform in a legislative 
     package to address the current mortgage crisis.
       State regulators recognize that this reform effort builds 
     on state initiatives to modernize our mortgage regulatory 
     system. Specifically, the legislation establishes a 
     nationwide mortgage lending database that coordinates with 
     the Nationwide Mortgage Licensing System currently being 
     operated by CSBS and the American Association of Residential 
     Mortgage Regulators (AARMR).
       By January of this year, 42 state agencies representing 
     mortgage regulators in 40 states have signed a statement of 
     intent indicating their commitment to participate in the 
     CSBS/AARMR Nationwide Mortgage Licensing System. Eventually, 
     CSBS and AARMR expect all 50 will transition onto the System. 
     The System successfully began operations on January 2, with 7 
     states launching the system. An additional 9 states will be 
     on by the end of 2008 with the rest of the states rolling on 
     in 2009 and beyond.
       Again, we strongly encourage you to include the provisions 
     of the SAFE Mortgage Licensing Act in legislation designed to 
     resolve the current mortgage crisis.
           Sincerely
                                                      Neil Milner,
     President and CEO.
                                  ____



                             National Association of Realtors,

                                    Washington, DC, April 3, 2008.
     Hon. Diane Feinstein,
     U.S. Senate,
     Washington, DC.
     Hon. Mel Martinez,
     U.S. Senate,
     Washington, DC.
       Dear Senators Feinstein and Martinez: On behalf of over 1.3 
     million members of the National Association of REALTORS, I 
     want to share our views on the SAFE Mortgage Licensing Act 
     amendment offered by Senators Feinstein and Martinez.
       We believe this amendment will go far toward preventing 
     another subprime market failure that would further erode 
     confidence in the Nation's housing finance system. While 
     responsible subprime lenders have played an important role in 
     helping millions of consumers achieve homeownership, abusive 
     subprime lending has occurred much too often. As a result, 
     roughly 2.2 million American households have been projected 
     to lose their homes and as much as $164 billion due to 
     subprime mortgage foreclosures.
       Many of the provisions of the amendment are consistent with 
     NAR's ``Responsible Lending Principles.'' We believe our 
     principles provide an appropriate basis for legislation that 
     would help eliminate irresponsible practices such as making 
     loans without sufficient regard to the borrower's ability to 
     repay the loan and avoid foreclosure.
       The National Association of REALTORS supports responsible 
     lending, mortgage servicing and appraisal practices. We 
     support this amendment that will help close the door on 
     abusive lending practices.
           Sincerely,
                                               Richard F. Gaylord,
                                                   2008 President.

  Mrs. FEINSTEIN. I yield to the distinguished Senator from Florida, 
Mr. Martinez.
  The PRESIDING OFFICER. The Senator from Florida is recognized.
  Mr. MARTINEZ. I thank the Senator from California. What a pleasure it 
is to work with the Senator on this bill, this important piece of 
legislation. She has stated it so well.
  I want to perhaps go over a few items I think ought to be also said. 
I know when I first became Secretary of Housing and Urban Development I 
was shocked at the role, ever-increasing and prominent role, that 
mortgage brokers play in the home purchasing process.
  When there is such a close working relationship with a customer--
there are issues that deal with premiums, there is the question of 
fiduciary responsibility--all of these issues arise because of that 
relationship, and oftentimes it is the closest point of contact with 
the customer. And many times they are the most vulnerable of customers.
  So that is why I am delighted to join with the Senator from 
California in the Safe Mortgage Licensing Act. I hope, like her, that 
we can get at it and talk about it, and I would like for us to work 
with the managers of the bill. I know there are some concerns that the 
Senator mentioned perhaps that can be resolved in conference. But I 
look forward to working with the bill managers toward the resolution of 
those small issues that may remain.
  With foreclosures at record levels and home prices in steady decline, 
we must act quickly to restore consumer confidence in the housing 
market. Florida has the dubious distinction of ranking No. 2 in the 
Nation in foreclosures. In February, Florida had one foreclosure filing 
for every 254 households, up more than 7 percent from January's rate--
truly frightening.
  Last year, more than 2 percent of Florida's households entered some 
form of foreclosure, and that is a 124-percent increase from the year 
of 2006. Many of these foreclosures can be attributed to predatory 
lending practices of unscrupulous mortgage brokers. And while the 
mortgage broker industry ought to be commended for supporting this 
bill, and to my own profession of law, there are always bad actors out 
there. That is what this is getting at.
  Let me point out, in the State of Florida we have the dubious 
distinction of leading the country when it comes to foreclosures. This 
is the list of the top cities across the country. And you can see why 
the Senators from Florida and California are here talking about this. 
We have been hit hard.
  No. 1 leading the country is Cape Coral-Fort Myers, FL, at 5.8 
percent. Then we have No. 2, which is Port St. Lucie, FL, at 3.9 
percent. Then Miami, Miami Beach, and Kendall at 3.1 percent; Fort 
Lauderdale, Pampano, Deerfield Beach at 3 percent. And then after a 
couple of California communities and Ohio, we have Naples-Marco Island, 
FL, at 2.7 percent. This is concentrated in some of the better areas of 
Florida where home prices have been in a dramatic rise for many months 
and years in the recent past.
  The current system provides little coordination between State 
regulators and, therefore, exposes consumers to predatory loan 
originators who have crossed State lines. The creation of a nationwide 
system will eliminate bad actors by keeping track of those who violated 
the law, had their licenses revoked or failed to fulfill appropriate 
educational requirements that will benefit families and eventually the 
marketplace.
  It would give home buyers more transparency and more peace of mind as 
they make one of the most important decisions and, frankly, maybe the 
largest financial decision of their lives. The SAFE Mortgage Licensing 
Act would, for the first time, establish a national professional 
licensing standard for mortgage brokers and lenders. This would ensure 
that all mortgage professionals are trained in Federal lending laws, 
ethics, consumer protection, and subprime market lending. The 
legislation also would create a national database that consumers can 
use to verify the credentials of the brokers and lenders. This 
amendment would require all residential mortgage loan originators to be 
licensed, provide fingerprints, and a summary of work experience, and 
consent to a background check.
  States are given 12 months to develop licensing standards to ensure 
that applicants meet the following minimum criteria: No felony 
convictions; no similar license ever revoked; a demonstrated record of 
financial responsibility; successful completion of educational 
requirements; and passage of a written exam. If this does not occur, 
the Housing and Urban Development Secretary is empowered to develop the 
national database and license, generating revenue for its 
implementation through fees to license applicants. The Federal Reserve, 
Treasury, and FDIC must also register all residential mortgage loan 
originators employed by national banks within 12 months of this 
legislation being enacted.
  The SAFE Act has been endorsed by mortgage regulators in 40 States, 
and the National Association of Realtors agrees with and supports this 
amendment.
  I thank the Senator from California for working with me on this 
important piece of legislation. We need to do

[[Page 4967]]

more to empower families who have worked hard, who look to home 
ownership as an important piece of their American dream. While there 
are details to be worked out, I look forward to working with Chairman 
Dodd and Ranking Member Shelby to see if we cannot eliminate any 
concerns that might be out there. We don't want to throw the net so 
wide it may ensnare people for whom we are not intending this to be 
their concern, but we also are committed to getting this done. This is 
an important step forward. I look forward to moving the process along.
  I appreciate working with the distinguished Senator from California.
  I thank the Chair, yield the floor, and suggest the absence of 
quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. KYL. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. KYL. Mr. President, I ask unanimous consent that the pending 
amendment be laid aside for the purpose of my offering an amendment.
  The PRESIDING OFFICER. Is there objection?
  Without objection, it is so ordered.


                Amendment No. 4407 to Amendment No. 4387

  Mr. KYL. Mr. President, I ask that amendment No. 4407 be called up. I 
believe it is at the desk.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Arizona [Mr. Kyl] proposes an amendment 
     numbered 4407 to amendment No. 4387.

  Mr. KYL. Mr. President, I ask unanimous consent that reading of the 
amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

  (Purpose: To amend the Internal Revenue Code of 1986 to adjust for 
   inflation the dollar limitation for the principal residence gain 
                               exclusion)

       At the end add the following:

              TITLE _--PRINCIPAL RESIDENCE GAIN EXCLUSION

     SEC. _01. INFLATION ADJUSTMENT FOR PRINCIPAL RESIDENCE GAIN 
                   EXCLUSION DOLLAR LIMITATION.

       (a) In General.--Section 121(b) of the Internal Revenue 
     Code of 1986 (relating to limitations) is amended by adding 
     at the end the following new paragraph:
       ``(4) Inflation adjustment.--In the case of any calendar 
     year after 2008, the dollar amount contained in paragraph (1) 
     shall be increased by an amount equal to--
       ``(A) such dollar amount, multiplied by
       ``(B) the cost-of-living adjustment determined under 
     section 1(f)(3) for the calendar year, determined by 
     substituting `calendar year 2007' for `calendar year 1992' in 
     subparagraph (B) thereof.

     Any increase determined under the preceding sentence shall be 
     rounded to the nearest multiple of $1,000.''.
       (b) Conforming Amendment.--So much of subparagraph (A) of 
     section 121(b)(2) of the Internal Revenue Code of 1986 as 
     precedes clause (i) thereof is amended to read as follows:
       ``(A) Limitation for certain joint returns.--Paragraph (1) 
     shall be applied by doubling the dollar amount specified in 
     such paragraph if--''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to years beginning after December 31, 2008.

  Mr. KYL. Mr. President, this amendment is actually very simple, and I 
think it will be another one of the things that we can do to help 
promote home ownership and the transfer of property to make it less 
expensive for people and, frankly, to advance a policy that we should 
have advanced a long time ago.
  Most people know under current law they can exclude $250,000--for a 
married couple it is $500,000--from the capital gains when they sell 
their principal residence. In other words, even though you may make 
$250,000 on the value of your home when you sell it, that is excluded 
from the capital gains that would otherwise have to be paid.
  You are limited by some requirements. You have to live in the home 
for 2 years. You have to own and occupy the home in 2 of the previous 5 
years from the sale. But you are able to exclude from the capital gains 
$250,000. The problem is, as we found out with the alternative minimum 
tax, inflation can drive the value of this exclusion down.
  So what this amendment does, simply, is index the exclusion for 
inflation. It is very simple. I cannot imagine it would be 
controversial. What this would do, of course, is to preserve the value 
of this deduction that we have all taken advantage of for the future 
and thereby encourage individuals to purchase a new home. Of course, 
much of what we are trying to do in this legislation is encourage home 
ownership but, more than that, encourage people to purchase homes or be 
able to transact the sale and purchase of a home.
  There is another point I want to make, and it is important because 
some people have been caught in an innocent situation with regard to 
the foreclosures we are concerned about. People do not buy homes, for 
the most part, to make money. Now, it is true there were speculators in 
this red hot housing market and, obviously, we are in no mood to bail 
out speculators. But most people buy a home to raise their family, and 
they live in the home.
  This exclusion, of course, requires they live in the home for 2 years 
out of 5 years before the sale. So we are not talking about the 
situation where brokers would buy a home and then wait a couple months 
and flip it and sell it and make a big profit. This is for legitimate 
folks who bought a home to live in and have their family live in it and 
then sold it.
  A large portion of a capital gain on a home is now inflation. That is 
the hard reality of it. I do not think any of my colleagues believe it 
should be subject to taxation. Unfortunately, inflation now is around 4 
percent. It is growing faster than that. Therefore, for the future I 
think this is an important amendment as well.
  So this amendment protects homeowners from unexpected changes in 
family status, employment, and health. It would help elderly taxpayers 
who sell their home and choose to move into less expensive housing 
during their retirement. Frequently, there is a capital gain on their 
longtime residence, and it would help them avoid having to pay a 
capital gains tax.
  It clearly simplifies tax administration and record keeping. It would 
provide people with a much easier situation for acquiring a home.
  Mr. President, there are some additional arguments that I could make. 
Let me cite a couple statistics. Then I am hoping I can perhaps engage 
some of my colleagues in a discussion to see if there would actually be 
a need to vote on this amendment or whether we could agree to it.
  Let me cite a couple statistics. Usually we do not like to get into 
this much detail, but I think in this case it makes sense. We have seen 
housing prices now fall from what some call their bubble highs--the 
value that was driven up so dramatically, and now it has fallen. Alan 
Greenspan famously called it the froth in the housing market.
  But housing prices are still much higher than they were in 1997. I 
think about my State. I think about the Senator from California, her 
State, and those States where property values appreciated, but a lot of 
that appreciation is now due to inflation.
  Here are a couple of interesting stats: The median single-family home 
price in 1997 was $146,000. A decade later, in 2007, the median home 
price was $247,200--over $100,000 more in just 10 years. The median 
home price in California 10 years ago was $186,500, roughly. In 
February of 2008 it was $409,240--in other words, an increase of 
$222,750.
  So, very clearly, there is a huge inflation factor going into the 
value of these homes, and we are going to have to pay capital gains tax 
on that above the $250,000 level if we do not index that amount for 
inflation.
  So I could go on. I think it is so simple. It is a proposition that I 
would assume would have support from both sides of the aisle. There is 
nothing political about this, of course, and it would certainly help a 
lot of our homeowners at a time when we are searching for ways to do 
exactly that.
  So I would pause at this point to see if anyone has any objection or 
questions about it. I will yield the floor otherwise. But I would love 
the opportunity to get into a discussion about it

[[Page 4968]]

and see if there is any concern on anybody's part about it.
  The PRESIDING OFFICER. The Senator from Connecticut.
  Mr. DODD. Mr. President, if I may, let me say to my friend from 
Arizona, I do not know. I have asked Senator Baucus and Senator 
Grassley, with matters involving tax policy, to come over and defer to 
them.
  Mr. KYL. I appreciate that.
  Mr. DODD. This is within their jurisdiction, and I just do not feel 
competent to address this as an issue. I am told by staff we are 
waiting for a score on this, how you would score it. That much I do 
know, that you have to score tax amendments. So I will let them come 
over and make a case for or against when they arrive. They should be 
here at some point to respond to the Senator from Arizona. I apologize 
to him, but I just do not feel--
  Mr. KYL. Mr. President, I appreciate that. We have an estimated cost, 
but perhaps we should wait until my colleagues get here. I will be 
happy to discuss that aspect of it as well.
  With that, if there is no further discussion, then I will be happy to 
yield the floor. But I certainly hope my colleagues will take a look at 
this amendment and join me in supporting this amendment for the benefit 
of homeowners all over the United States of America.
  Mr. President, I yield the floor.
  The PRESIDING OFFICER. The Senator from Louisiana.
  Ms. LANDRIEU. Mr. President, I ask unanimous consent to lay the 
pending amendment aside so I can offer the amendment I spoke on earlier 
today.
  The PRESIDING OFFICER. Is there objection?
  Without objection, it is so ordered.


                Amendment No. 4389 to Amendment No. 4387

  Ms. LANDRIEU. Mr. President, I call up amendment No. 4389 for its 
immediate consideration.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Louisiana [Ms. Landrieu], for herself, Mr. 
     Cochran, Mr. Vitter, and Mr. Wicker, proposes an amendment 
     numbered 4389 to amendment No. 4387.

  Ms. LANDRIEU. Mr. President, I ask unanimous consent that reading of 
the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

 (Purpose: To amend the Internal Revenue Code of 1986 to allow use of 
  amended income tax returns to take into account receipt of certain 
hurricane-related casualty loss grants by disallowing previously taken 
casualty loss deductions, and to waive the deadline on the construction 
     of GO Zone property which is eligible for bonus depreciation)

       At the end add the following:

               TITLE _--HURRICANE-RELATED CASUALTY LOSSES

     SEC. _01. USE OF AMENDED INCOME TAX RETURNS TO TAKE INTO 
                   ACCOUNT RECEIPT OF CERTAIN HURRICANE-RELATED 
                   CASUALTY LOSS GRANTS BY DISALLOWING PREVIOUSLY 
                   TAKEN CASUALTY LOSS DEDUCTIONS.

       Notwithstanding any other provision of the Internal Revenue 
     Code of 1986, if a taxpayer claims a deduction for any 
     taxable year with respect to a casualty loss to a personal 
     residence (within the meaning of section 121 of such Code) 
     resulting from Hurricane Katrina or Hurricane Rita and in a 
     subsequent taxable year receives a grant under Public Law 
     109-148, 109-234, or 110-116 as reimbursement for such loss 
     from the State of Louisiana or the State of Mississippi, such 
     taxpayer may elect to file an amended income tax return for 
     the taxable year in which such deduction was allowed and 
     disallow such deduction. If elected, such amended return must 
     be filed not later than the due date for filing the tax 
     return for the taxable year in which the taxpayer receives 
     such reimbursement or the date that is 4 months after the 
     date of the enactment of this Act, whichever is later. Any 
     increase in Federal income tax resulting from such 
     disallowance shall not be subject to any penalty or interest 
     under such Code if such amended return is so filed.

                       TITLE _--GO ZONE PROPERTY

     SEC. _01. WAIVER OF DEADLINE ON CONSTRUCTION OF GO ZONE 
                   PROPERTY ELIGIBLE FOR BONUS DEPRECIATION.

       (a) In General.--Subparagraph (B) of section 1400N(d)(3) of 
     the Internal Revenue Code of 1986 is amended to read as 
     follows:
       ``(B) without regard to `and before January 1, 2009' in 
     clause (i) thereof,''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to property placed in service after December 31, 
     2007.

  Ms. LANDRIEU. Mr. President, I really appreciate the cooperation of 
the manager because this is a very important amendment for the gulf 
coast. It is an amendment I offer with the support of the Senators from 
Mississippi--Mr. Cochran and Mr. Wicker--as well as Senator Vitter from 
Louisiana.
  We have been waiting for some time now for some housing bill to get 
to the floor of the Senate where we could offer a small number of 
amendments that are essential to give aid during the ongoing housing 
crisis that exists in the gulf today.
  I say to the Presiding Officer, as you know, as you remember because 
you have been down to Louisiana, to New Orleans particularly--and we 
are very grateful for the support that so many Senators have given--
throughout the gulf coast, literally from Mobile to Beaumont, and 
particularly from Biloxi to Cameron Parish, there is still a tremendous 
crisis in housing and reconstruction.
  I am not going to belabor the point--only to say that I have had 
Secretary Chertoff on the record as late as 3 weeks ago, Chief Paulson 
today, the IG of the Homeland Security Committee today in Homeland 
Security saying the Stafford Act was not intended to handle 
catastrophic disasters and that FEMA has yet to make any substantial 
progress in getting ready to handle catastrophic disasters. They have 
made moderate progress. They have made modest but not substantial 
progress.
  Our people need substantial everything. They needed it yesterday. 
They need it today. This amendment will help them get a little bit of 
it now. My amendment basically will allow the people of Mississippi and 
Louisiana and Texas and Alabama--those who are affected by Katrina, 
Rita, and Wilma, which was one of the worst seasons of hurricane 
disaster, in 2005--to basically receive the aid we have already sent to 
them through the community development block grants. In Louisiana we 
call it the Road Home Program. These programs were designed at the 
State level, but they were funded by us. In Mississippi it is called 
the Mississippi Homeowner Assistance Program. It has literally sent 
direct lifesaving aid to over 150,000 families in Louisiana and about 
probably 50,000 to 75,000 in Mississippi. I do not have the Mississippi 
numbers.
  My amendment will help to correct this great injustice that is 
occurring now. We did not intend for this to occur, but it is going to 
occur if this amendment or something like this amendment is not 
adopted.
  We sent under a design, basically designed by this Congress, an 
approximately $150,000 grant to homeowners to help close the gap 
between what their insurance covered and the total cost of their loss. 
As I have said many times, homes that were worth $1 million or $2 
million were totally destroyed, as well as homes that were worth 
$50,000.
  Many of these homes were not in the flood plain. They were not 
required to have flood insurance. They were destroyed by the failure of 
a Federal levee system that collapsed, as well as historic highs of 
flooding and water coming from Hurricane Rita, which was one of the 
toughest and most aggressive storms on record.
  So the long and short of it is, when we sent this $150,000 grant--we 
are still in the process of sending it. It has been very slow, very 
frustrating, and just so aggravating to so many people who are holding 
on by their fingernails to try to save what equity they had in their 
homes, which, as you know, for most American families that is their 
personal wealth. I think 95 percent of all Americans have almost 100 
percent of their entire personal wealth tied up in their home. So this 
issue of helping homeowners in the gulf coast is literally trying to 
help restore to them a lifetime of work. In some instances, generations 
of work have been lost in this storm.
  Now, we are not making everybody whole. Believe me, there has been 
enough pain in the gulf coast to go around for a century or more. But 
what happens is, when they receive their

[[Page 4969]]

$150,000 grant--and most people have received an average of about 
$65,000. The authorized level is $150,000, but you have to qualify for 
that amount. So the average is about $60,000, which sounds like a lot 
of money, but if your house was worth $500,000, and your insurance has 
refused to pay you, it is not a whole lot of money to rebuild your 
house with labor costs that are going up at 20 percent or more since 
the storm.
  So what is happening now is, when they receive these grants--and 
under the tax law, they can take a casualty deduction. If they did that 
last year, what happens this year--by April 15, which is in about 2 
weeks--for that family who makes $75,000 a year--let's say the Smith 
family--let's take the Jones and Smith families. They make about the 
same amount of money. One family this year who took the casualty loss 
deduction is going to have to pay $24,000 in taxes. The family only 
makes $75,000, if they are lucky enough to have the job they had before 
Katrina and Rita struck.
  Now, this amendment is not cheap. I make no bones about it. It is 
about $1 billion. It can be done on an emergency basis. This most 
certainly is an emergency in housing.
  So that is the essence of the amendment. The Finance Committee is 
well aware of it. We have been talking about it with them for over a 
year now actually. We have just been waiting for a time to get it 
fixed.
  Now, again, this is an emergency. It is a real problem. It is almost 
April 15. We have, I would argue, families in America who need the most 
help on housing. I feel very sorry for people who are losing their 
homes in foreclosure, and I am not even going to try to say whether 
they are suffering more than the people in the gulf south. All I can 
say is the people in the gulf south didn't take out any adjustable 
mortgages. The people in the gulf south, most of them had already paid 
their 30-year mortgage. They own their house scot-free. They paid for 
it. Now they have lost everything, and we are trying to help them, but 
in my view, everything we try to do to help them kind of--sometimes it 
turns out to not help them as much as we would like. There is no 
textbook. There is no Stafford Act. There is no way to help people who 
lost everything because of levees that should have held but didn't. We 
are making it up as we go along, and this is part of my job here to do 
this. So we have to fix this, and that is what this amendment will do. 
I am very proud that the Senators from both States have agreed to 
cosponsor this.
  On behalf of Senator Cochran, at his request--and I am happy to 
support it--there is also a small change in this amendment which will 
allow this deduction--this goes on the accelerated depreciation piece 
that we gave to help some of our businesses. We lost 20,000 businesses 
that weekend. I think Mississippi lost 1,800. That is a lot of 
businesses to lose over a weekend. To help those businesses and people 
get back on their feet, this Congress extended to them a way to 
accelerate their depreciation, but we said: The way to get that 
accelerated depreciation is you have to start your project by a certain 
time and finish by a certain time. The problem is, the recovery has 
been so much slower than everybody anticipated because we have never 
really gone through this catastrophic situation. Senator Cochran is 
right when he says we should eliminate the start date. We are not 
asking for an extension, so technically it really shouldn't add money. 
We are not asking to extend it to any time or to let a lot of new 
people come in. But for the same universe, just don't make them start 
their project the way it said, but let them end it. That is also in my 
amendment. So we will solve two big problems: We will help our 
businesses, many small businesses, get the full benefit of what we 
wanted to give them anyway, actually work for them, and we will make 
this grant program work for them.
  Now, let me be clear. When we pass this amendment, which I hope we 
will do by unanimous consent or get a large vote on it because I think 
we really should do it in a bipartisan way, the people to whom we give 
this tax break--this will lower their rate to their regular rate they 
will have to pay. They have to go back and reimburse the Treasury for 
that deduction they took. So, in other words, we are not allowing them 
to take two benefits. They are going to have to lower their tax this 
year, eliminate the tax on Road Home, and go back and pay the Federal 
Government the benefit they took. Their CPAs will have to figure that 
out. But if we don't do this, there will be people who will be stuck 
with a tax bill they could not possibly pay, and they shouldn't have 
to; they have suffered enough.
  So I know the Senator from Connecticut, the chairman of the Banking 
Committee, knows full well what is happening down in the gulf. This is 
only one thing we are attempting to fix. I have several other 
amendments I intend to offer, if my colleagues would allow me, at an 
appropriate time, but this is the amendment I wanted to get in. April 
15 is right around the corner, and they need to know what our intention 
is. This will help so many people. I appreciate it. I will ask for this 
amendment to be voted on when the first group, however large that group 
is--2, 5, 6, 10--whenever the first group of amendments is voted on, I 
would like for this to be included in that group. I ask unanimous 
consent for that to be the case.
  The PRESIDING OFFICER. Is there objection?
  Ms. LANDRIEU. Mr. President, I will repeat for the Senator from 
Connecticut that I will be happy to take this amendment whenever, but I 
would like it to be voted on in the first group of amendments, however 
big that group is and whenever that group will be taken up.
  Mr. DODD. Mr. President, if I may, reserving the right to object, I 
would say to my colleague, this is a tax amendment, and I am very 
carefully deferring any questions regarding tax matters to the Finance 
Committee, to Senator Baucus and Senator Grassley, as to how they want 
to proceed. So I really would be hesitant about agreeing to--no votes 
have been agreed to on anything at this point. I would strongly 
recommend that my colleague from Louisiana talk to Senator Baucus about 
this.
  Ms. LANDRIEU. I appreciate that. Let me tell my colleague that I 
have, and it is included in their tax package. So just so the Senator 
from Connecticut knows, I will not agree to any votes going forward 
unless this amendment is in the group. So I am fine, and I will just 
stay here. The Finance Committee is well aware of this, and they have 
actually put it in their package. My concern is that their package may 
not ever really sort of get to the floor. There are some things in that 
package that I think really need to be voted on. So that is OK. I will 
just stay here, and we will work on what we can do. I really appreciate 
it.
  Mr. DODD. Mr. President, further, having spoken with Senator Baucus 
and his staff on this matter, they are trying to accommodate the 
various amendments that are being posed in the area the Senator is also 
suggesting some ideas for, and I think they are desirous of 
accommodating as many as they can, provided it can be worked out. I 
don't know enough about this to say any more than that. They are 
working on it. It might make more sense to work with them to make sure 
we are OK.
  Ms. LANDRIEU. Mr. President, again, I just want to be clear that I 
would expect this to be in the first group of votes that are taken as 
we proceed on this bill. Whether it is 2 or 3 or 10 or 20, this needs 
to be in it or I will object to going forward. Thank you.
  The PRESIDING OFFICER. Does the Senator withdraw her unanimous 
consent or is there objection?
  Mr. DODD. I have to object to any unanimous consent request at this 
time.
  The PRESIDING OFFICER. Objection is heard.
  Mr. DODD. Does my colleague from Louisiana need to be heard any 
further on the amendment?
  Ms. LANDRIEU. No. Thank you.
  Mr. DODD. Mr. President, I note the absence of a quorum.

[[Page 4970]]

  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. SANDERS. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Nelson of Florida). Without objection, it 
is so ordered.


                Amendment No. 4401 to Amendment No. 4387

  Mr. SANDERS. Mr. President, I ask unanimous consent to lay the 
pending amendment aside so I may call up my amendment No. 4401 and ask 
for its immediate consideration.
  The PRESIDING OFFICER. Is there objection? Without objection, it is 
so ordered.
  The clerk will report.
  The legislative clerk read as follows:

       The Senator from Vermont [Mr. Sanders] proposes an 
     amendment numbered 4401.

  Mr. SANDERS. Mr. President, I ask unanimous consent that reading of 
the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

 (Purpose: To establish a national consumer credit usury rate, and for 
                            other purposes)

       At the appropriate place, insert the following new section:

     SEC. __. NATIONAL CONSUMER CREDIT USURY RATE.

       Section 107 of the Truth in Lending Act (15 U.S.C. 1606) is 
     amended by adding at the end the following:
       ``(f) National Consumer Credit Usury Rate.--The annual 
     percentage rate applicable to any extension of credit may not 
     exceed by more than 8 percentage points the rate established 
     under section 6621(a)(2) of the Internal Revenue Code of 
     1986, as determined by the Board.''.

  Mr. SANDERS. Mr. President, this amendment is extremely important 
because it addresses not only the foreclosure crisis we are seeing in 
this country, but it is also an issue that impacts millions and 
millions of Americans every single day of their lives well above and 
beyond the housing crisis.
  What this amendment essentially says is the time is long overdue for 
this Congress to have the courage to stand up to the banks, credit card 
companies, and mortgage lenders who are charging outrageously high 
interest rates and ripping off the American people. I know when I go 
back to Vermont, I talk to people who say: Why is it I am paying 20, 
25, 28 percent interest rates on my credit card? I can tell you, as a 
former member of the Financial Services Committee in the House, we 
heard horror story after horror story about payday lending.
  We know mortgage brokers are, in some cases, bringing forth 
unscrupulously dishonest packages that drive interest rates up far 
beyond what should be charged in this country. This is an issue we must 
address, and now is the time to do that.
  Specifically, this amendment would cap all interest rates at 8 
percent above what the IRS charges income tax deadbeats. Currently, the 
IRS charges a 6-percent interest rate to Americans who are late on 
paying their income tax returns. The IRS adjusts these rates every 
quarter based on the Federal funds rate. If the Federal funds rate 
rises, the interest rate the IRS charges late filers goes up as well. 
If the Federal funds rate goes down, so does the interest rate the IRS 
charges late filers.
  If the amendment I am offering were to become law today, all interest 
rates would be capped in this country at 14 percent, including subprime 
mortgages, credit cards, auto loans, payday loans, and income tax 
refund anticipation loans.
  Why 14 percent? How did we come up with that magical number? Well, it 
is interesting. I will tell you why we came up with that number. In 
1991, our former colleague, the Republican Senator from New York, the 
former chairman of the Banking Committee, as I recall, Al D'Amato, 
offered an amendment that would cap credit card interest rates at 14 
percent. Senator D'Amato was not remembered as a radical extremist. He 
was the chairman of the committee. Here is what is interesting. That 
amendment to cap interest rates at 14 percent for credit cards won on 
the floor of the Senate by a vote of 74 to 19; it was not even close. 
It had strong bipartisan support.
  If I might, obviously, 1991 was a while ago and many people who 
served are no longer here. But a number of people who served in 1991 
are still here today. These are the people who voted in 1991 for the 
D'Amato amendment to cap credit card interest rates at 14 percent in 
alphabetical order: Senators Akaka, Baucus, Biden, Byrd, Cochran, 
Conrad, Dodd, Domenici, Grassley, Inouye, Kennedy, Kerry, Kohl, 
Lautenberg, Leahy, Levin, Lieberman, McCain, Mikulski, Reid, 
Rockefeller, Shelby, Specter, Stevens, and Warner. Those 25 Members, in 
1991, voted to cap interest rates at 14 percent on credit cards.
  In truth, this amendment goes beyond credit cards to other areas 
where people are today paying very high interest rates. Similar to my 
amendment, the D'Amato amendment of 1991 was also pegged slightly above 
the interest rates for late income tax filers. We are using the same 
formula D'Amato used.
  Let me quote Senator D'Amato on the floor in 1991:

       Fourteen percent is certainly a reasonable rate of interest 
     for banks to charge customers for credit card debt. It allows 
     a comfortable profit margin but keeps banks in line so that 
     interest rates rise and fall with the health of the economy.

  Other people went to the floor and also spoke on this issue. Senator 
Lieberman spoke on it and Senator Domenici spoke on it as well.
  What I say to my colleagues is, if this legislation, which passed 
with overwhelming support in 1991, made sense then, let me tell you, it 
makes a lot more sense today. A recent report published by Tamara 
Draut, the director of the Economic Opportunity Program at Demos, found 
that one-third of all credit card holders in this country are paying 
interest rates above 20 percent and as high as 41 percent--more than 
double what they paid in interest in 1990. So if we had over 70 Members 
of the Senate voting to cap interest rates at 14 percent in 1991, today 
the vote should be even higher because the crisis is far more severe.
  Between 1989 and 2006, Americans' overall credit card debt grew by 
315 percent, from $211 billion to $876 billion. All over this country, 
people who are not earning enough money to pay for basic needs are 
buying groceries and gasoline to fill up their car with credit cards. 
And then, in turn, what happens is they are paying 20, 25 percent 
interest rates, and we have the cycle of misery going around and 
around, where they are too poor to pay with cash, so they pay with 
credit, and credit card interest rates are soaring, and they go deeper 
into debt.
  I know this is a hard vote. It is no secret to anybody in the Senate 
that the financial services industry is enormously powerful. But it is 
time for us to think about the folks back home who are going deeper 
into debt and to stand with them and put a cap on interest rates.
  One-third of low- and middle-income families reported going into 
credit card debt to pay for rent, utilities, and food in 2006. That 
same year, Americans charged $51 billion worth of fast food on their 
credit card, a 29-fold increase since 2001.
  All of this, and more, has allowed credit card companies to earn $90 
billion in interest in 2006 alone. I will repeat that.
  But credit card companies are not the only ones charging outrageous 
interest rates. That is why this amendment I am offering expands on the 
D'Amato amendment to cover all forms of loans.
  For example, the Center for Responsible Lending has found some 
American consumers are paying interest rates for payday loans as high 
as 800 percent. I think all the Senators understand this. These types 
of outrageous interests should not be allowed to continue. When the 
Federal Reserve has slashed the Federal funds rate five times, from a 
high of 5.25 percent to 2.25 percent, credit card interest rates should 
be going down, not up. Interest rates for payday loans should be going 
down, not up. If the Fed is cutting interest rates, how in God's name--
and why--are people paying higher and higher interest rates on their 
credit cards, their mortgages, and in other areas?

[[Page 4971]]

  One of the reasons for this scam, this rip-off, is the virtual lack 
of regulation in this country when it comes to interest rates. For 
example, credit card companies are able to raise interest rates at any 
time for any reason. I suspect I am not the only Member of the Senate 
who talked to a constituent who said: I pay my credit card bill on time 
every single month, and I used to be paying 9 percent, but now they 
raised it to 14 percent. What did I do wrong? Why are they raising my 
interest rates?
  Every Member of the Senate has, himself or herself, received, along 
with everybody else in this country, all these fancy prospectives that 
come from the credit card companies, saying zero percent interest rate 
or 2 percent interest rate. But they forget to tell you in big bold 
print what is in the little print on page 4: They can raise interest 
rates any time for any reason. You don't even have to be late paying 
your phone bill or rent. They can raise it for any reason whatsoever.
  One of the interesting facts, in terms of credit cards, is people 
would be stunned to know that the credit card companies send out, every 
single year--do you know how many of these things they send out? Four 
billion. We are a country of 300 million people. I thought I was 
getting all of them but apparently not. They seem to come to my house 
twice a day. Apparently, others are getting them as well. They send out 
4 billion of these fancy brochures, urging you to buy into the credit 
card thing and it costs them a fortune. But, obviously, they can afford 
to do that because they are ripping off the American people, and they 
are charging 20, 25, and 30 percent, in some cases, in interest. This 
is unacceptable behavior. Lenders should not be able to raise interest 
rates at any time for any reason.
  I am not going to go into a religious theme now. I am not going to do 
that. But I know the Presiding Officer is a religious person and 
probably more familiar with the Bible than I am. But he will know that 
the word ``usury'' is mentioned in the Bible on many occasions. I will 
not quote from them, but in Leviticus chapter 25, verses 35 to 37, the 
issue about usury rates is, in fact, addressed.
  I will talk about Dante's ``Divine Comedy.'' In the ``Divine Comedy'' 
by Dante, he speaks about a special place for people who charge 
usurious interest rates, and that is the inner ring of the Seventh 
Circle of Hell.
  I don't particularly wish that on the banking industry and all the 
lobbyists who come here every day. I don't wish that on them. But I do 
wish they would take a deep breath and understand that this is not just 
an economic issue, it is a moral issue. People who are struggling to 
pay their bills, who are going into debt, through no fault of their 
own, should not have to pay 25 or 30 percent interest rates.
  Mr. DURBIN. Mr. President, will the Senator yield for a question?
  Mr. SANDERS. I will be very happy to yield to the Senator from 
Illinois.
  Mr. DURBIN. I direct my question through the Chair to the Senator and 
thank him for offering the amendment and say to the Senator from 
Vermont that over a year ago, while making a phone call to someone in a 
financial institution in New York on an unrelated issue, the person 
said to me: Watch out for subprime mortgages. It did not register with 
me, but I should have paid closer attention. A few months ago, while 
making a similar call to a financial institution in New York, the 
fellow said: Watch out for credit cards because people are shifting 
their debt now into credit card debt with the sky-high interest rates.
  Many people listening may ask what is this about. This is supposed to 
be about housing. It is not about housing. It is about the credit 
vulnerability of America. Housing is the first canary in the cage the 
Senator shared, if he will allow me to use that analogy. Credit cards 
will quickly follow.
  I say to the Senator from Vermont, when we debated bankruptcy reform 
on the floor of the Senate 3 or 4 years ago, the credit card industry 
was pushing that bill because they wanted credit card debt to survive 
bankruptcy so you could carry it to the grave. I put a provision in 
that bill that said on a monthly statement for a credit card asking for 
a minimum monthly payment, you have to disclose to the person holding 
the credit card how long it would take them to pay off the balance if 
they paid the minimum monthly payment. The credit card industry 
refused, saying it was technically impossible to calculate. Does 
anybody believe that?
  I say to the Senator from Vermont, they had a feature on ``NOVA,'' 
which I think is an extraordinary program, about credit cards. They 
heralded this one man who is the guru of credit cards who dreamed up 
lowering the percentage of minimum monthly payments from 5 percent a 
month to 2 percent because he created an endless stream of debt. If you 
pay 2 percent, you will never catch up with yourself. You will pay debt 
forever.
  So those who think this amendment of the Senator from Vermont is 
unrelated to our conversation about housing are wrong.
  The last point I will make is, I thank the Senator from Vermont for 
mentioning payday loans. They rip off members of the military like no 
other entity in America, and they are a blight on America's credit 
horizon.
  I thank the Senator for offering this amendment. My question is, Can 
I sign on as a cosponsor?
  Mr. SANDERS. With pleasure. I thank the Senator from Illinois.
  Mr. President, I will conclude because the Senator from Illinois made 
the point better than I can make it. Every Member of the Senate knows 
this is a huge issue. In their heart, every Senator knows there is 
something immoral, that there is something outrageous about hard-
working people paying 25, 30 percent, especially at a time when the Fed 
is lowering interest rates.
  I say to my colleagues, it is no great secret. The financial services 
industry is very powerful. We all know that. They make huge campaign 
contributions. They have a lot of power here. But I hope that on this 
amendment, we have the courage to stand up to them.
  In concluding, I remind my colleagues that in 1991, when Senator 
D'Amato offered a similar amendment, there was overwhelming bipartisan 
support. The American people want us to act on this issue. As the 
Senator from Illinois indicated, this is directly related to the 
housing crisis, and I think it is time we move forward and put a cap on 
interest rates.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Missouri.
  Mrs. McCASKILL. Mr. President, I commend Senator Sanders on his 
amendment and look forward to supporting it. We have a lot of work to 
do on credit cards. It is much worse than people realize in terms of 
some of the practices the credit card industry has employed. One of my 
favorites is trying to lure people to their limit on credit, and when 
they get them there, raising their interest rates and telling them: 
Well, you are at your credit limit.
  I can give many examples of how that practice is utilized, including 
sending people the check already made out so if they sign their name on 
that check and use it, then they are at their credit limit and up pops 
their interest rate. All kinds of tricks are used to try to--by the 
way, don't ever try to pay off a bunch of credit cards because it is 
hard to pay them off. First, they don't want you to pay in full every 
month and they don't want you to pay them off. For gosh sakes, they 
don't want you to cancel a card. They will immediately take notice you 
lost your card because they are on the hook. In fact, I pointed out in 
one of the hearings we had to the credit card executives, the only 
thing that is easy to understand on this is the first line which says 
if you lose your credit card or your credit card is stolen, call this 
phone number because they know they are on the hook if the credit card 
is lost or stolen, so they are interested in you getting to them in 
those circumstances. All the other circumstances you press this number 
and maybe you will get someone who will talk to you after you have hung 
on the phone for 2 hours.
  I do not rise to talk about credit cards today. I rise to talk about 
reverse mortgages. I have an amendment that will be called up at a 
later time. I

[[Page 4972]]

am proud we have been working on this amendment. We had a hearing on 
this subject in the Aging Committee. We have been working with Senator 
Shelby and his staff. We have been working with HUD. AARP has been 
helping with this amendment. They did a massive report that they issued 
about reverse mortgages.
  If we look at the subprime mess and sit back and say, what caused the 
problem, the root of the problem is the people selling the subprime 
mortgages had no risk. If you have a risk, you are careful. If you have 
no risk, then it is very simple: I just have to close the sale.
  We are doing the exact same thing with reverse mortgages. If you are 
watching any cable TV--and probably way too many people in this Chamber 
are watching way too much cable TV right now because everybody is 
watching the cable news channels because we are all addicted to the 
Presidential race and every twist and turn it encompasses--if you are 
watching any of the cable news shows, you are seeing advertisements 
over and over again by Robert Wagner, Pat Boone, and all these 
familiar, trusted faces saying: You know, don't miss out. There are 
advertisements that are being marketed to elderly people across this 
country that are saying: Don't pass up this Government benefit you are 
entitled to.
  I have to tell the truth, I don't think anybody envisioned reverse 
mortgages were going to be called ``a Government benefit you are 
entitled to.'' Why are they saying that? They are saying that because 
ultimately the taxpayers are on the hook for these loans.
  Guess what. The people who are selling them are making commissions, 
and they have no risk. We kind of like these reverse mortgages around 
here because, guess what, we make some money on it, too. That is, the 
Federal Government. So there is a push to lift the lid on how many 
reverse mortgages can be marketed to elderly people because the Federal 
Government is getting some of the money when they are sold. But we are 
going down a dangerous path because we are marketing a product that is 
complicated and expensive to the most vulnerable population in America.
  For many of these elderly people, all they have is their home. For 
many of these elderly people, they do not have a loved one with whom 
they can talk about whether this financial instrument is a good idea.
  Don't get me wrong, some reverse mortgages are good and they may be 
appropriate in some circumstances. But here is what is not appropriate: 
We require counseling. We have appropriated a whopping $300 million for 
counseling. They have to have counseling in every case, so guess who is 
paying for the counseling? Bad news: The lenders are paying for the 
counseling. So the same people who want to close the loans are paying 
the counselors who are supposed to be giving these elderly people 
advice that is unbiased as to whether this is a good idea for them.
  The amendment will step up to the plate and say we are not going to 
repeat the subprime fiasco with the Nation's ``greatest generation.'' 
We are going to, in fact, fund the counselors so they get good, 
independent information. We are going to make sure those counselors are 
certified. Right now, they can have a criminal record, they can have no 
training. This is the wild, wild west out there selling a financial 
product that is expensive and complicated to our elderly. It does not 
take a rocket scientist to figure out that is a dangerous combination.
  The other thing this amendment does is it is going to prohibit 
someone who is marketing one of these reverse mortgages from being able 
to sell another product. Believe it or not, there are actually some 
people who are sitting down with elderly people right now in America 
saying: We are going to get you a reverse mortgage and, by the way, at 
the same time, we are going to sell you a deferred annuity. I don't 
know how these people look themselves in a mirror.
  We had a witness in front of our committee whose mother was in her 
eighties and sold a deferred annuity and a reverse mortgage at the same 
time. It is unconscionable to make the sale and make the money. It is a 
get-rich-quick scheme for some of these sales people. If we can provide 
certified counselors who are truly independent to make sure that every 
elderly person understands exactly what they are getting into, and if 
we can make sure they are not being marketed products that are 
inappropriate by the same people who are selling them reverse 
mortgages, and if we can make sure we are not closing a blind eye to 
this because we are benefiting in the short run from the marketing of 
these products, then I think reverse mortgages have an appropriate 
place as one potential help to people in their elderly years who need 
to get the equity out of their homes for emergencies or medical bills 
or even to send a loved one to college. Right now, it is a dangerous 
situation.
  I look forward to hopefully having unanimous, bipartisan support for 
this amendment. As I say, HUD has been very helpful in drafting this 
language, along with AARP, along with our colleagues on the other side 
of the aisle. It is well thought out. I think it is very appropriate, 
noncontroversial. It is not opposed by the industry. There are many 
good guys who are doing this work. We want to make sure we are 
protecting the elderly from the bad guys and making sure we are not 
standing here 5 years from now saying: Why didn't we do something about 
reverse mortgages? It is the same kind of dangerous mix we have in the 
subprime mortgages.
  Mr. President, I yield the floor.
  The PRESIDING OFFICER. The chairman of the Banking Committee.
  Mr. DODD. Mr. President, before our colleague from Missouri leaves 
the floor, I thank her. She has done a terrific job on this proposal. I 
know she is working with Senator Shelby and others on the committee in 
crafting this proposal in a way that can make a difference.
  Our colleague is absolutely correct in describing this problem. It is 
despicable in many ways how people are being lured into arrangements 
they cannot afford. It would be devastating for them economically. I 
thank her for the proposal and let her know we are going to do 
everything we can in these hours of trying to work this out to 
accommodate this very important idea. She has put in tremendous effort 
on this issue and needs to be recognized. I thank the Senator from 
Missouri, and we will try to be helpful on this amendment. I thank the 
Senator for raising it.
  My colleague from Vermont, Senator Sanders, who has left the Chamber, 
offered his amendment. I listened to my colleague from Missouri. I 
spent the last 20 years or so dealing with the credit card industry and 
various problems with it. I have not done terribly well, I might point 
out, trying to modify some of these ideas that have become outrageous. 
Senator Carl Levin of Michigan cares deeply about the issue as well. We 
have been preoccupied with the housing issue, obviously, in the Banking 
Committee over the last year, but we are also crafting legislation 
dealing with the credit card companies.
  Many are doing the right things today. Some of the major companies 
are. I don't want to suggest here it is an indictment of every credit 
card company, nor do any of us have any objection to credit cards. It 
has been a tremendously valuable vehicle for a significant number of 
consumers. But an abuse of the process, and where literally they are 
targeting some of the most vulnerable people in our society and 
targeting them in such a way where the slightest delay, even an hour or 
so, can add significant cost, fees, and an interest rate climb, makes 
it virtually impossible for some people to ever get out from underneath 
their credit card debt.
  The average person in this country today, an adult, has a revolving 
debt exceeding $9,300, getting close to $10,000, I was told the other 
day. And 95 percent of that is credit card debt. This is, obviously, 
heading in the wrong direction at a time when we have a negative 
savings rate and consumer debt is mounting. We need to be doing 
everything we can to make it possible for

[[Page 4973]]

people to have credit cards, for the credit card industry to make a 
legitimate profit in that industry--that is critically important--but 
not to make it impossible for people to pay off these obligations and 
to get their lives in order.
  This is one of the concerns I had with the bankruptcy bill a few 
years ago when it was adopted; that bankruptcy legislation made it so 
difficult for people with credit cards to get out from under those 
obligations if they took the bankruptcy act. So there are a lot of 
issues to talk about, and Senator Sanders has raised an important issue 
and certainly Senator McCaskill has as well in talking about these 
problems. I want my colleagues to know that at some point we are going 
to craft legislation dealing with this issue in a comprehensive and 
thoughtful manner so we don't allow the abuses to go on where people 
never, ever can manage to climb out from under those obligations, 
saddling them with lifelong economic burdens and making it impossible 
for them to accumulate wealth and provide for the needs of their 
families.
  So I appreciate very much their raising these concerns as they have 
this evening.
  I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  The PRESIDING OFFICER. The Senator from Nevada.
  Mr. ENSIGN. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. ENSIGN. Mr. President, I ask unanimous consent to set aside the 
pending amendment and call up amendment No. 4419 and ask for its 
immediate consideration.
  Mr. DODD. Reserving the right to object, Mr. President, I see my 
colleague from Montana is here, and we need to see the amendment, first 
of all. I have no idea what the amendment is.
  The PRESIDING OFFICER. Is there objection?
  Mr. BAUCUS. I object.
  The PRESIDING OFFICER. Objection is heard.
  The Senator from Nevada.
  Mr. ENSIGN. Mr. President, the amendment I was attempting to offer is 
a bipartisan amendment on renewable energy at a time when our country 
is looking for cleaner sources of energy. We are also looking for more 
domestic sources of energy and at ways to help our economy. This 
housing bill is not just a housing bill, it is a bill to help our 
economy. It is a bill to keep us from going further into recession. The 
amendment I introduce is a bill Senator Cantwell and I have worked on 
for the last several weeks because there has been an impasse on 
renewable energy legislation. The offsets that were included in the 
original bill were unacceptable. And because there are going to be very 
few vehicles that are moving this year, we are trying to get this 
amendment on this bill to try to get renewable tax credits included so 
it can be signed into law this year.
  The problem is, if you wait too long on these renewable tax credits, 
these businesses will shut down because they require time in advance 
for planning and business development. So it is critical we get this 
done.
  I know the chairman of the Finance Committee is working on a bill, he 
is working on some offsets, but the problem I see with what he is doing 
is it may not pass later on in the year, and it also may be too late. 
So this bill may be the best vehicle we have to ensure America becomes 
less dependent on foreign sources of oil and other energy sources. It 
may be the last chance we have to preserve over 100,000 jobs in the 
United States that have been and can be created in the renewables 
industry. And it may be the last chance we have this year to 
significantly help the environment in America.
  So I appreciate that the Democratic chairman of the Finance Committee 
has objected to us bringing up this amendment, but we are going to 
continue to try to get this amendment on this bill. Mr. President, I 
think it is a mistake at this critical time for renewables and for our 
country that an objection has been made to our offering of this 
amendment at this time.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Montana.
  Mr. BAUCUS. Mr. President, all of us are concerned about ways to 
protect and to make our country more self-sufficient in the production 
of energy. We have made many attempts on this floor, in fact a major 
bill was voted on last year and was actually one vote shy of the 
necessary 60 votes.
  Many of us are working here, including the Senator from Nevada, as 
well as the Senator from Washington, Senator Cantwell, to find a way to 
bring up a significant energy bill later this year. There are various 
candidate bills for that. One is something called the extenders, and I 
think that is one of several ways where we can get this done. Extenders 
is going to pass. That is not an idle bill. It is going to pass.
  The amendment offered by Senator Ensign is unpaid for, and, to be 
honest, I frankly think the other body--some of them are called Blue 
Dogs--is not going to put up with it. We have to pay for an energy 
bill, and we are working on the offsets so we can get it paid for and 
so we can get it enacted into law.
  So I think, at this point, it would be a mistake to bring up this 
version because it would not survive a point of order challenge, and I 
urge the Senator from Nevada to work with the Finance Committee, work 
with others together, in a concerted way, to get something passed 
rather than going solo and trying on his own to push something that is 
not part of a team but, rather, as an individual. Because individual 
efforts are not going to be as successful as team efforts, and so I 
urge the Senator to be a part of the team so we can get this thing 
passed.
  Mr. ENSIGN. Will the Senator yield for a question?
  Mr. BAUCUS. Through the Chair, I will be glad to.
  Mr. ENSIGN. Mr. President, we have over 20 cosponsors of the bill we 
introduced today. It is a bipartisan effort. We are working as part of 
a team. What we are trying to do is work together.
  So I would ask the Senator: With 20 Republicans and Democrats 
cosponsoring this bill together, does he consider them to be working as 
individuals or as part of a team? We will probably have over 50 
cosponsors by the early part of next week. It seems to me that the way 
the Senate works is getting people together and not worrying about 
whether you are a Republican or Democrat but worrying about what is 
right for the American people. That is what we are attempting to do.
  Mr. BAUCUS. I deeply appreciate the Senator wanting to be part of the 
team. There is another number here called 60. And it is my judgment 
that with more working together on measures with others, the greater 
the likelihood we will get this passed. We all want it passed. Let us 
do it in the context and in a forum in which we can get it passed.
  I yield the floor, and I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. CARDIN. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Sanders). Without objection, it is so 
ordered.
  Mr. CARDIN. Mr. President, I ask unanimous consent that the pending 
amendment be set aside so I can offer an amendment.
  The PRESIDING OFFICER. Is there objection?
  Mr. CARDIN. Mr. President, I ask unanimous consent to withdraw that 
amendment for a moment so we can make sure everyone has copies of it. I 
will use this time now to speak on the amendment, and then I will offer 
it when I have completed.
  The PRESIDING OFFICER. The amendment is not yet pending.


                Amendment No. 4421 to Amendment No. 4387

  Mr. CARDIN. Mr. President, the amendment I will be offering shortly, 
along with Senator Ensign, is an

[[Page 4974]]

amendment that would try to help the housing market itself. It would 
provide a tax credit, a temporary tax credit just for this next year, 
for residential home purchases. It is for someone who is using the 
house as their primary residence. It would be a $7,000 credit spread 
out over 2 years. It would be aimed at trying to get people to buy 
homes today.
  As I am sure you are aware and as has been explained on this floor, 
there is a glut on the housing market. There are so many homes that 
people are trying to sell, and potential buyers are reluctant to come 
in to purchase a home because they don't know whether the value will go 
down. They are waiting. They are sitting it out.
  It was the housing market that triggered our current downturn in the 
economy. We need to pay attention to the housing market in order to get 
our economy back on track.
  The intent of this amendment is to get more interest by home buyers 
so they will buy homes today knowing that the Government, through a tax 
credit, is covering some of their risks and making it more affordable 
for them to be able to buy a home. That is exactly what this amendment 
would do.
  Senator Ensign and I have crafted this amendment so it is temporary. 
It is available only for the next year. We have crafted it so it is 
targeted. It only applies to first-time home buyers, those who are most 
in need. In the Nation, approximately 35 percent of those who buy homes 
are first-time home buyers. In my own city of Baltimore, it is closer 
to 65 percent. So it is a large number of people who are potentially in 
the market, but they are the most reluctant--those who do not own homes 
today are the most reluctant to come in and buy a home because of the 
uncertainty in the market. It is targeted in that it only applies to 
those of limited income, middle-income families. It uses the same 
dollar limits that are currently used in the District of Columbia tax 
credit that has been so successful in encouraging families to buy homes 
within our Nation's Capital. About 3,000 to 4,000 individuals every 
year take advantage of the tax credit we provide for the residents of 
the District to buy a home.
  This credit, which is temporary and which is targeted, which is aimed 
at middle-income families, which is aimed at first-time home buyers, 
which is aimed at getting more interest among consumers into our 
housing so we can try to help our economy--I think it is the right 
complement to the legislation that is before us.
  The legislation before us is aimed at trying to help people to be 
able to find mortgages. It is aimed at dealing with homes that are in 
foreclosure, trying to allow people to stay in their homes, and 
allowing local governments to have more ability to deal with 
refinancing homes for those who have subprime mortgages. I have already 
talked on the floor about this issue. It is aimed at trying to get 
better advice to people who may be buying homes, and it also has a tax 
credit. I acknowledge Senator Isakson, who has worked on that. It deals 
with distressed properties. I would also like to acknowledge that my 
colleague, Senator Stabenow, has been a longtime proponent of tax 
credits to stimulate home buys. This amendment is aimed at generating 
more interest in home buys so we can help bring our economy back to 
recovery.
  I thank my colleague, Senator Ensign, for his input in helping to 
craft this amendment and his cosponsorship of it. I urge our colleagues 
to consider that.
  Mr. President, I now offer that amendment.
  The PRESIDING OFFICER. The clerk will report the amendment.
  The bill clerk read as follows:

       The Senator from Maryland [Mr. Cardin], for himself and Mr. 
     Ensign, proposes an amendment numbered 4421 to amendment 
     number 4387.

  The amendment is as follows:

(Purpose: To amend the Internal Revenue Code of 1986 to allow a credit 
   against income tax for the purchase of a principal residence by a 
                         first-time homebuyer)

       At the end, insert the following:

               TITLE _--FIRST-TIME HOMEBUYERS' TAX CREDIT

     SEC. _01. CREDIT FOR FIRST-TIME HOMEBUYERS.

       (a) In General.--Subpart A of part IV of subchapter A of 
     chapter 1 of the Internal Revenue Code of 1986 (relating to 
     nonrefundable personal credits) is amended by inserting after 
     section 25D the following new section:

     ``SEC. 25E. PURCHASE OF PRINCIPAL RESIDENCE BY FIRST-TIME 
                   HOMEBUYER.

       ``(a) Allowance of Credit.--
       ``(1) In general.--In the case of an individual who is a 
     first-time homebuyer of a principal residence in the United 
     States during any taxable year, there shall be allowed as a 
     credit against the tax imposed by this subtitle for the 
     taxable year an amount equal to so much of the purchase price 
     of the residence as does not exceed $7,000.
       ``(2) Allocation of credit amount.--The amount of the 
     credit allowed under paragraph (1) shall be equally divided 
     among the 2 taxable years beginning with the taxable year in 
     which the purchase of the principal residence is made.
       ``(b) Limitations.--
       ``(1) Limitation based on modified adjusted gross income.--
       ``(A) In general.--The amount allowable as a credit under 
     subsection (a) (determined without regard to this subsection) 
     for the taxable year shall be reduced (but not below zero) by 
     the amount which bears the same ratio to the credit so 
     allowable as--
       ``(i) the excess (if any) of--

       ``(I) the taxpayer's modified adjusted gross income for 
     such taxable year, over
       ``(II) $70,000 ($110,000 in the case of a joint return), 
     bears to

       ``(ii) $20,000.
       ``(B) Modified adjusted gross income.--For purposes of 
     paragraph (1), the term `modified adjusted gross income' 
     means the adjusted gross income of the taxpayer for the 
     taxable year increased by any amount excluded from gross 
     income under section 911, 931, or 933.
       ``(2) Limitation based on amount of tax.--In the case of a 
     taxable year to which section 26(a)(2) does not apply, the 
     credit allowed under subsection (a) for any taxable year 
     shall not exceed the excess of--
       ``(A) the sum of the regular tax liability (as defined in 
     section 26(b)) plus the tax imposed by section 55, over
       ``(B) the sum of the credits allowable under this subpart 
     (other than this section and section 23) for the taxable 
     year.
       ``(c) Definitions and Special Rules.--For purposes of this 
     section--
       ``(1) First-time homebuyer.--
       ``(A) In general.--The term `first-time homebuyer' has the 
     same meaning as when used in section 72(t)(8)(D)(i).
       ``(B) One-time only.--If an individual is treated as a 
     first-time homebuyer with respect to any principal residence, 
     such individual may not be treated as a first-time homebuyer 
     with respect to any other principal residence.
       ``(C) Married individuals filing jointly.--In the case of 
     married individuals who file a joint return, the credit under 
     this section is allowable only if both individuals are first-
     time homebuyers.
       ``(D) Other taxpayers.--If 2 or more individuals who are 
     not married purchase a principal residence--
       ``(i) the credit under this section is allowable only if 
     each of the individuals is a first-time homebuyer, and
       ``(ii) the amount of the credit allowed under subsection 
     (a) shall be allocated among such individuals in such manner 
     as the Secretary may prescribe.
       ``(2) Principal residence.--The term `principal residence' 
     has the same meaning as when used in section 121.
       ``(3) Purchase.--
       ``(A) In general.--The term `purchase' means any 
     acquisition, but only if--
       ``(i) the property is not acquired from a person whose 
     relationship to the person acquiring it would result in the 
     disallowance of losses under section 267 or 707(b) (but, in 
     applying section 267 (b) and (c) for purposes of this 
     section, paragraph (4) of section 267(c) shall be treated as 
     providing that the family of an individual shall include only 
     the individual's spouse, ancestors, and lineal descendants), 
     and
       ``(ii) the basis of the property in the hands of the person 
     acquiring it is not determined--

       ``(I) in whole or in part by reference to the adjusted 
     basis of such property in the hands of the person from whom 
     acquired, or
       ``(II) under section 1014(a) (relating to property acquired 
     from a decedent).

       ``(B) Construction.--A residence which is constructed by 
     the taxpayer shall be treated as purchased by the taxpayer.
       ``(4) Purchase price.--The term `purchase price' means the 
     adjusted basis of the principal residence on the date of 
     acquisition (within the meaning of section 72(t)(8)(D)(iii)).
       ``(d) Denial of Double Benefit.--No credit shall be allowed 
     under subsection (a) for any expense for which a deduction or 
     credit is allowed under any other provision of this chapter.
       ``(e) Recapture in the Case of Certain Dispositions.--In 
     the event that a taxpayer--

[[Page 4975]]

       ``(1) disposes of the principal residence with respect to 
     which a credit is allowed under subsection (a), or
       ``(2) fails to occupy such residence as the taxpayer's 
     principal residence,
     at any time within 24 months after the date on which the 
     taxpayer purchased such residence, then the remaining portion 
     of the credit allowed under subsection (a) shall be 
     disallowed in the taxable year during which such disposition 
     occurred or in which the taxpayer failed to occupy the 
     residence as a principal residence, and in any subsequent 
     taxable year in which the remaining portion of the credit 
     would, but for this subsection, have been allowed.
       ``(f) Basis Adjustment.--For purposes of this subtitle, if 
     a credit is allowed under this section with respect to the 
     purchase of any residence, the basis of such residence shall 
     be reduced by the amount of the credit so allowed.
       ``(g) Property to Which Section Applies.--The provisions of 
     this section shall apply to a principal residence if the 
     taxpayer's date of acquisition of the residence (within the 
     meaning of section 72(t)(8)(D)(iii)) and date of settlement 
     on such residence are during the period beginning on the date 
     of the enactment of this section and ending on the date that 
     is 1 year after such date.''.
       (b) Conforming Amendments.--
       (1) Section 24(b)(3)(B) of the Internal Revenue Code of 
     1986 is amended by striking ``and 25B'' and inserting ``, 
     25B, and 25E''.
       (2) Section 25(e)(1)(C)(ii) of such Code is amended by 
     inserting ``25E,'' after ``25D,''.
       (3) Section 25B(g)(2) of such Code is amended by striking 
     ``section 23'' and inserting ``sections 23 and 25E''.
       (4) Section 25D(c)(2) of such Code is amended by striking 
     ``and 25B'' and inserting ``25B, and 25E''.
       (5) Section 26(a)(1) of such Code is amended by striking 
     ``and 25B'' and inserting ``25B, and 25E''.
       (6) Section 904(i) of such Code is amended by striking 
     ``and 25B'' and inserting ``25B, and 25E''.
       (7) Subsection (a) of section 1016 of such Code is amended 
     by striking ``and'' at the end of paragraph (36), by striking 
     the period at the end of paragraph (37) and inserting ``, 
     and'', and by adding at the end the following new paragraph:
       ``(38) to the extent provided in section 25E(f).''.
       (8) Section 1400C(d)(2) of such Code is amended by striking 
     ``and 25D'' and inserting ``25D, and 25E''.
       (c) Clerical Amendment.--The table of sections for subpart 
     A of part IV of subchapter A of chapter 1 of the Internal 
     Revenue Code of 1986 is amended by inserting after the item 
     relating to section 25D the following new item:
       ``Sec. 25E. Purchase of principal residence by first-time 
           homebuyer.''.

  Mr. CARDIN. I now yield to the Senator from Nevada.
  The PRESIDING OFFICER. The Senator from Nevada is recognized.
  Mr. ENSIGN. Mr. President, I wish to applaud the Senator from 
Maryland, Mr. Cardin, for his great work. It has been a pleasure 
working with his staff and with him personally on this very important 
amendment.
  We are trying to help the housing situation in the United States. My 
State, Nevada, leads in foreclosures. I saw a statistic the other day 
that, after a record month of foreclosures in February, foreclosures in 
March were up another 50 percent over February. So it is a huge 
problem. There are a lot of young people out there--first-time home 
buyers--who want to get into the marketplace to try to participate in 
the American dream. That is what this amendment is about. It is 
targeted right at those young people, or the single person, who is 
trying to buy a home for the first time. And maybe they might even be a 
little older but have never been able to afford a home until now. This 
might be the economic incentive to get them into owning their home for 
the first time.
  There are so many benefits to home ownership. There is more of a 
sense of community when you are paying property taxes; you care more 
about the schools; you care more about where those taxes are going.
  So this is an excellent amendment at a great time when we are trying 
to help the housing market. But we will also be helping individual 
Americans with this tax credit at the same time. I wish to applaud the 
leadership of Senator Cardin on this. We worked together well when we 
were both on the Ways and Means Committee in the House of 
Representatives. This is another example of what bipartisanship can be 
about. It is about putting the country before your party and looking 
for solutions that actually work. So I am proud to cosponsor this 
amendment and be the lead Republican on it. I hope this amendment can 
be adopted as part of the final package.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Maryland.
  Mr. CARDIN. Mr. President, let me say to my colleague again from 
Nevada, the two of us did work together very closely in the other body, 
and now it is a real pleasure to serve together in this body. It is a 
great honor.
  I think the comments the Senator has made about home ownership are so 
important. Home ownership is critically important to our country. We 
know where there is home ownership, schools are better, the crime is 
less.
  One of the statistics I found very interesting was a study in Chicago 
that there was a distinct relationship in a neighborhood between the 
number of foreclosures and the rise of violent crime. This is an issue 
that should involve all of us.
  I also wish to thank Senator Dodd. He has done a great service to our 
Nation in being able to bring forward a bill that has bipartisan 
support. That is not easy today; it is very difficult. We now have the 
opportunity to move forward.
  I was explaining to Senator Dodd that one of my constituents a little 
bit earlier this evening said: You know, we are so encouraged that 
Democrats and Republicans could come together on a housing bill, that 
there is now hope we can act quickly.
  What he said to me is interesting. He said: You know, there are a lot 
of good things in this bill. I think I could have done it better. There 
are some things I would like to have seen in there. But what I like is 
you are able to move, you are able to get something done. It is a real 
signal to this country that Congress is engaged on the housing crisis 
and wants to do something to help that person who today is in danger of 
losing his or her home because of a foreclosure, or is in danger of 
walking away.
  One of the things I found amazing is 50 percent of people walk away 
from their homes; they do not even try. This bill will give them hope 
that the Government is on their side. It can provide some additional 
financing, it is going to provide some additional help and counseling, 
it is going to provide an opportunity for that person to maintain the 
American dream.
  The American dream is about being able to succeed in this country. 
The most visible sign is owning a home. A lot of people are going to 
lose their homes as a result of this recession. This legislation will 
make it possible for more Americans to save their homes.
  The amendment Senator Ensign and I are offering is a way in which we 
believe, I think our colleagues believe, that this body has a 
responsibility to help build our economy. One of the ways we can do it 
is by encouraging more home ownership.
  This amendment, by providing a tax credit, is saying: The Government 
is on your side. Go now, buy a home, we will help you hedge against the 
potential risk and make it a little more affordable for you to own a 
home.
  I encourage my colleagues to accept that amendment.
  I yield the floor.
  Mr. ISAKSON. Would the Senator yield for a question?
  Mr. CARDIN. I yield.
  Mr. ISAKSON. Mr. President, I wish to ask the Senator from Maryland a 
point of clarification for the Members. This amendment is an additional 
tax credit in addition to the one that is already in the bill; is that 
correct?
  Mr. CARDIN. That is correct.
  Mr. ISAKSON. So what you are doing, you leave targeted the stimulus 
to absorb the foreclosed properties, but you add a stimulus for first-
time home buyers in the marketplace?
  Mr. CARDIN. The Senator is correct.
  Mr. ISAKSON. I wanted to make sure that is reflected in the Record.
  The PRESIDING OFFICER. The Senator from Connecticut.
  Mr. DODD. Mr. President, I wish to thank my colleague from Maryland 
for

[[Page 4976]]

his generous comments about the effort and to also commend him and 
Senator Ensign and others who are working on these ideas to provide 
some relief and some opportunity for people. I think he said it well.
  It becomes almost axiomatic, maybe it is becoming overused, but it 
certainly captures what all of us feel. That is, there is no greater 
wealth creator, there is nothing more to stabilize a family or a 
community, there is nothing that does more for families than having a 
stable, reliable home. It sounds maybe silly to some people.
  I am old enough to remember when this issue was never a partisan 
issue. In fact, some of the strongest advocates of affordable shelter 
came from some of the most conservative Members of this body 
historically. Going back, I recall as a young man growing up listening 
to the distinguished Senators from Alabama and others, they were ``Mr. 
Housing'' in those days. They made a huge difference. This was an issue 
where we all worked together to see to it that families and individuals 
had the opportunity to have affordable shelter.
  So our colleague from Maryland is absolutely correct. In fact, you 
could make the case even more so today. And to watch what has happened 
over the last relatively short period of time, values decreasing, 
prices falling, which has been good news to some degree, except that 
obviously as supply increases demand and neighborhoods deteriorate--we 
were talking about the city of Baltimore.
  I do not know if my colleague heard me talking about Bridgeport, CT, 
the other day. I have a new mayor that got elected, Bill Finch, former 
State Senator in Connecticut. He got elected to be mayor in my biggest 
city in Connecticut. He walks in to be mayor, he has got between 5,000 
and 6,000 foreclosures in a city in Fairfield County, one of the most 
affluent counties in America, hearing as many as 6,000 families could 
be losing their homes in the coming days.
  So his point here about how to make sure we rehabilitate, provide 
opportunity, create those ideas and thoughts that will make it possible 
for people to move into a home, to acquire a home, is critically 
important.
  I commend him for that, thank him for his generous comments about the 
effort here tonight.
  Mr. CARDIN. Let me thank again the Senator from Connecticut. The 
circumstances in Baltimore, in Maryland, in June we ranked 40th in the 
Nation in foreclosures. We now rank in the teens, 18th in foreclosures. 
The number of foreclosures in communities where we never thought we 
would see foreclosures is recordbreaking. That is not the type of 
records we want to have.
  So as the Senator knows, it not only affects that homeowner who is 
going to potentially lose his or her home, it affects every house in 
the community. I was talking with some of the housing authority people, 
some of the people from the nonprofit community who work with these 
neighborhoods, and the cost to the neighborhood is staggering when you 
have foreclosed properties. So we are going to have to do something 
about that.
  But it would be a lot better investment that we prevent the 
foreclosures for those who are financially able to stay in their homes. 
I think that is what your legislation does. I applaud you for that. 
Every person we can keep in the home who can afford to stay there will 
benefit many more people in that community. By the way, it is good for 
local Government. It will help their property tax revenues. It is good 
for local governments; I think it will reduce their costs. I think it 
is a win-win situation. So I congratulate you for bringing forward a 
bill we can act on quickly, in order to save homes for people who 
otherwise are likely to lose their homes and to strengthen 
neighborhoods that would otherwise be suffering as a result of those 
foreclosures.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Florida.
  Mr. NELSON of Florida. Mr. President, I wish to first extend my 
appreciation to the Senator in the chair for the courtesy he extended 
to me earlier with regard to the duties of the Presiding Officer. The 
Senator from Vermont is very kind.
  Later on, I will be offering an amendment with Senator Coleman, and 
we think this is an amendment that will possibly be accepted. So I am 
going to wait and not offer the amendment until Senator Coleman is able 
to be here.
  But I wish to go on and set the record of what this amendment would 
be. Under current law, if a person has a 401(k) retirement plan and 
they want to buy a house and it is to be their principal residence, 
they can take up to $10,000 out of their retirement plan for the 
purchase of that house and not pay the penalty under law for taking 
assets out of their retirement plan.
  Now, since that is available to us under current law, would it not 
make sense for a person, if they are about to lose their home, their 
principal residence, to be able to take money out of their retirement 
plan in order to save their home from foreclosure, if it were done in a 
limited period of time, if it were the principal residence for them, 
not to have to pay that 10-percent penalty?
  So that is the essence of the amendment. It would allow a person, 
under these circumstances, and this would only be available for 2 
years, given the fact that now is the time of the foreclosure crisis, 
that the homeowner, on their principal residence, could then take 
$25,000 out of their retirement plan without having to pay that 
penalty.
  Now, of course, if they keep it out, they are then going to have to 
pay income tax on that, which has up to that point been nontaxable 
because it has been in the retirement plan. But if they put it back in 
within a 3-year period, they would avoid the income tax.
  So we are trying to make it available under the theory that if it is 
going to purchase a home and to give someone a break by going into 
their retirement savings, then it ought to be good public policy to 
help them save their home from foreclosure by going into their 
retirement savings in order to save their home.
  That is why we think, at least from the early signals from the staff 
on both sides of the aisle, this would be a salutary amendment that may 
get some serious consideration to accept.
  This benefit is limited to 2 years, so it is not going to be 
permanent. So it will address the situation here. Why? Because in most 
instances, for Americans, their home is the single source of wealth for 
those Americans. So it makes sense, it makes common sense, to allow 
homeowners to use every tool available to stay in their own home and 
avoid foreclosure and save their greatest investment.
  So I am certainly encouraging my colleagues to support this 
amendment, and at the appropriate time, with the approval of the 
chairman of the committee, we will actually offer the amendment.
  I yield the floor and I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mr. DODD. I ask unanimous consent that the order for the quorum call 
be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DODD. Mr. President, I ask unanimous consent that at 7:40 
tonight, the Senate proceed to vote in relation to the following two 
amendments, with no amendments in order to the amendments prior to the 
vote; that if a point of order is raised against any of the amendments 
covered in this agreement for tonight and Friday and a motion to waive 
the appropriate point of order is made, then there be 2 minutes of 
debate with respect to the waiver prior to a vote on the motion to 
waive, equally divided and controlled in the usual form; and that upon 
the use or yielding back of the time, the Senate proceed to vote in 
relation to the amendments in the order listed for today and Friday: 
Murray-Schumer amendment No. 4397, and the Kyl amendment No. 4407; that 
when the Senate resumes consideration of the bill on Friday, the Senate 
then proceed to vote in relation to the following two amendments: 
Voinovich-

[[Page 4977]]

Stabenow amendment No. 4406 and the Landrieu, et al., amendment No. 
4389, with no amendment in order to the amendments prior to a vote; 
that in the sequence of votes for today and Friday, after the first 
vote, the remaining vote be 10 minutes in duration.
  The PRESIDING OFFICER. Is there objection?
  Mr. KYL. Mr. President, reserving the right to object, but I will not 
object, it is my understanding it would be the intention of the 
majority leader that immediately following the prayer and pledge and 
the opening of the session, we would begin the votes, that there would 
not be a long period of leader time taken in speaking by the leaders; 
is that correct?
  The PRESIDING OFFICER. The majority leader.
  Mr. REID. I say to my friend, I am always very short in my speeches. 
But we will have to talk to Senator McConnell. I am happy to set a good 
example and have about a minute and a half.
  Mr. KYL. I appreciate that very much. I do not object, therefore.
  Mr. DODD. Mr. President, I said 7:40. Let me modify the request and 
say 7:30. I was trying to provide a little leeway.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The Senator from Arizona.


                           Amendment No. 4397

  Mr. KYL. Mr. President, with respect to Murray-Schumer amendment No. 
4397, I make a point of order that the amendment violates section 
201(a) of S. Con. Res. 21 of the 110th Congress.
  The PRESIDING OFFICER. The Senator from Washington.
  Mrs. MURRAY. Mr. President, pursuant to section 201(b) of S. Con. 
Res. 21 of the 110th Congress, I move to waive the point of order for 
the consideration of the pending amendment, and I ask for the yeas and 
nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There appears to be a sufficient second.
  The yeas and nays were ordered.
  The PRESIDING OFFICER. Under the order, there are 2 minutes to be 
equally divided for debate.
  The Senator from Washington.
  Mrs. MURRAY. Mr. President, what our amendment simply does is provide 
an additional $100 million for counseling so families do not go into 
foreclosure. There is $15 billion in spending in this underlying bill, 
all of which is being declared an emergency. It seems to me that $100 
million of it, which is a small additional amount compared to that $15 
billion, that we know has a 96-percent success rate of keeping families 
in their home so they do not go into foreclosure, is a very smart 
investment.
  I think it would be very foolish to block this on a budget point of 
order because it is one of the few issues in this bill that will 
actually keep people in their homes and prevent this crisis from 
getting larger.
  I urge my colleagues to vote against the budget point of order.
  Mr. President, I ask unanimous consent that Senator Jack Reed of 
Rhode Island be listed as a cosponsor of this amendment.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Is there further debate on the motion to waive?
  The Senator from Alabama.
  Mr. SHELBY. Mr. President, Senator Dodd and I agreed to provide an 
additional $100 million for foreclosure counseling. This is already in 
addition to the $180 million provided for the same purpose earlier.
  It is my strong belief that we should conduct some due diligence on 
the money we have already provided to ensure that it is being spent 
properly and, most importantly, that it is actually helping people.
  In the interest of reaching an accommodation, I agreed to provide an 
additional $100 million. It is in the amendment. This brings the total 
spending for counseling for 2008 up to $280 million, an amount that 
represents a $238 million increase from last year. That is a lot of 
money.
  If there is a gap between what we have provided and what is needed, 
that need can be addressed through the normal appropriations process.
  I think a point of order has already been raised. I hope it will be 
sustained.
  The PRESIDING OFFICER. All time has expired.
  The question is on agreeing to the motion to waive.
  The yeas and nays were previously ordered.
  The clerk will call the roll.
  The bill clerk called the roll.
  Mr. DURBIN. I announce that the Senator from Delaware (Mr. Biden), 
the Senator from New Mexico (Mr. Bingaman), the Senator from California 
(Mrs. Boxer), the Senator from West Virginia (Mr. Byrd), the Senator 
from New York (Mrs. Clinton), the Senator from North Dakota (Mr. 
Conrad), the Senator from North Dakota (Mr. Dorgan), the Senator from 
Hawaii (Mr. Inouye), the Senator from Massachusetts (Mr. Kennedy), the 
Senator from New Jersey (Mr. Lautenberg), the Senator from Illinois 
(Mr. Obama), and the Senator from Virginia (Mr. Webb) are necessarily 
absent.
  Mr. KYL. The following Senators are necessarily absent: the Senator 
from Kentucky (Mr. Bunning), the Senator from Idaho (Mr. Crapo), the 
Senator from New Mexico (Mr. Domenici), and the Senator from Arizona 
(Mr. McCain).
  Further, if present and voting, the Senator from Kentucky (Mr. 
Bunning) would have voted ``no.''
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The yeas and nays resulted--yeas 44, nays 40, as follows:

                      [Rollcall Vote No. 89 Leg.]

                                YEAS--44

     Akaka
     Baucus
     Bayh
     Bond
     Brown
     Cantwell
     Cardin
     Carper
     Casey
     Coleman
     Collins
     Durbin
     Feingold
     Feinstein
     Harkin
     Johnson
     Kerry
     Klobuchar
     Kohl
     Landrieu
     Leahy
     Levin
     Lincoln
     McCaskill
     Menendez
     Mikulski
     Murray
     Nelson (FL)
     Nelson (NE)
     Pryor
     Reed
     Reid
     Rockefeller
     Salazar
     Sanders
     Schumer
     Smith
     Snowe
     Specter
     Stabenow
     Tester
     Voinovich
     Whitehouse
     Wyden

                                NAYS--40

     Alexander
     Allard
     Barrasso
     Bennett
     Brownback
     Burr
     Chambliss
     Coburn
     Cochran
     Corker
     Cornyn
     Craig
     DeMint
     Dodd
     Dole
     Ensign
     Enzi
     Graham
     Grassley
     Gregg
     Hagel
     Hatch
     Hutchison
     Inhofe
     Isakson
     Kyl
     Lieberman
     Lugar
     Martinez
     McConnell
     Murkowski
     Roberts
     Sessions
     Shelby
     Stevens
     Sununu
     Thune
     Vitter
     Warner
     Wicker

                             NOT VOTING--16

     Biden
     Bingaman
     Boxer
     Bunning
     Byrd
     Clinton
     Conrad
     Crapo
     Domenici
     Dorgan
     Inouye
     Kennedy
     Lautenberg
     McCain
     Obama
     Webb
  The PRESIDING OFFICER. On this vote, the yeas are 44, the nays are 
40. Three-fifths of the Senators duly chosen and sworn not having voted 
in the affirmative, the motion is rejected.
  The point of order is sustained and the amendment falls.


                           Amendment No. 4407

  The PRESIDING OFFICER. The question is on agreeing to the Kyl 
amendment No. 4407.
  The Senator from Montana is recognized.
  Mr. BAUCUS. Mr. President, I raise a point of order that the pending 
amendment violates section 401 of Senate Concurrent Resolution 21 of 
the concurrent resolution for the budget for fiscal year 2008.
  The PRESIDING OFFICER. The Senator from Arizona is recognized.
  Mr. KYL. Mr. President, under section 904, I move to waive the Budget 
Act, and I will ask for the yeas and nays after the presentation by 
Senator Baucus and myself.
  The PRESIDING OFFICER. Who yields time on the motion to waive?
  Mr. BAUCUS. Mr. President, I will take 30 seconds out of my time.
  This is not a proper amendment--
  Mr. DODD. Mr. President, the Senate is not in order.
  The PRESIDING OFFICER. The Senate will be in order.
  Mr. BAUCUS. Mr. President, this amendment essentially indexes the 
capital gains exclusion for the sale of a home. The problem is that 
homes are

[[Page 4978]]

decreasing in value, not that they are increasing, and most people who 
are trying to sell their homes have a much lower market value for their 
house. Therefore, this is not a necessary provision for them.
  This amendment would apply to others who are not subprime candidates 
who are in good shape and have nothing to do with the subprime issue, 
and I don't think we want to index for them at this point. It is $50 
billion that is the cost. It is unpaid for. This swallows up the 
housing bill. This is not the proper time, and that is why the point of 
order should stand because it violates the budget.
  The PRESIDING OFFICER. The Senate will be in order.
  The Senator from Arizona is recognized.
  Mr. KYL. Mr. President, this amendment is very simple. We all know 
that for individuals, there is a $250,000 exclusion from capital gain 
when you sell your owner-occupied property. For a couple, it is 
$500,000. But just like the AMT, it is not indexed for inflation. This 
amendment indexes that for inflation. That is all it does.
  Now, to my colleague saying that home values are going down, here are 
two statistics. I will cite one for the Nation and one for one State. 
Ten years ago, the median family priced home was $146,000. Today, it is 
$247,000. That is $100,000. In California, the median price 10 years 
ago was $186,000, roughly. It was $409,000 in February of this year, an 
increase of $222,000. The reality is that inflation has caused a 
tremendous increase in the value of homes, and when they are sold, 
people are going to have to pay the capital gains tax above $250,000.
  Could we have order?
  The PRESIDING OFFICER. The Senate will be in order.
  The Senator's time has expired.
  Mr. KYL. Well, Mr. President, might I ask unanimous consent for 15 
seconds to make the point that the cost of this is $2.1 billion over 5 
years, not the number the chairman indicated.
  Mr. BAUCUS. Mr. President, on my remaining time, the cost is $15 
billion over 10 years.
  Mr. KYL. Ten years.
  Mr. BAUCUS. We are taking 10-year numbers here. That is all we are 
talking about is 10 years, $15 billion.
  Second, this is not targeted to people who need it the most. Who 
needs it the most are those people whose homes are declining in value, 
not those homes that are increasing in value.
  The PRESIDING OFFICER. All time has expired.
  The question is on agreeing to the motion to waive the Budget Act.
  Mr. KYL. Mr. President, I thought the yeas and nays had been ordered, 
but I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The clerk will call the roll.
  The legislative clerk called the roll.
  Mr. DURBIN. I announce that the Senator from Delaware (Mr. Biden), 
the Senator from California (Mrs. Boxer), the Senator from West 
Virginia (Mr. Byrd), the Senator from New York (Mrs. Clinton), the 
Senator from North Dakota (Mr. Conrad), the Senator from North Dakota 
(Mr. Dorgan), the Senator from Hawaii (Mr. Inouye), the Senator from 
Massachusetts (Mr. Kennedy), the Senator from New Jersey (Mr. 
Lautenberg), the Senator from Illinois (Mr. Obama), and the Senator 
from Virginia (Mr. Webb) are necessarily absent.
  Mr. KYL. The following Senators are necessarily absent: the Senator 
from Kentucky (Mr. Bunning), the Senator from Idaho (Mr. Crapo), the 
Senator from New Mexico (Mr. Domenici), and the Senator from Arizona 
(Mr. McCain).
  Further, if present and voting, the Senator from Kentucky (Mr. 
Bunning) would have voted ``yes.''
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The result was announced--yeas 41, nays 44, as follows:

                      [Rollcall Vote No. 90 Leg.]

                                YEAS--41

     Alexander
     Allard
     Barrasso
     Bayh
     Bennett
     Bond
     Brownback
     Burr
     Chambliss
     Coburn
     Cochran
     Coleman
     Cornyn
     Craig
     DeMint
     Dole
     Ensign
     Enzi
     Graham
     Grassley
     Gregg
     Hagel
     Hatch
     Hutchison
     Inhofe
     Isakson
     Kyl
     Lugar
     Martinez
     McConnell
     Murkowski
     Roberts
     Sessions
     Shelby
     Smith
     Specter
     Stevens
     Sununu
     Thune
     Vitter
     Wicker

                                NAYS--44

     Akaka
     Baucus
     Bingaman
     Brown
     Cantwell
     Cardin
     Carper
     Casey
     Collins
     Corker
     Dodd
     Durbin
     Feingold
     Feinstein
     Harkin
     Johnson
     Kerry
     Klobuchar
     Kohl
     Landrieu
     Leahy
     Levin
     Lieberman
     Lincoln
     McCaskill
     Menendez
     Mikulski
     Murray
     Nelson (FL)
     Nelson (NE)
     Pryor
     Reed
     Reid
     Rockefeller
     Salazar
     Sanders
     Schumer
     Snowe
     Stabenow
     Tester
     Voinovich
     Warner
     Whitehouse
     Wyden

                             NOT VOTING--15

     Biden
     Boxer
     Bunning
     Byrd
     Clinton
     Conrad
     Crapo
     Domenici
     Dorgan
     Inouye
     Kennedy
     Lautenberg
     McCain
     Obama
     Webb
  The PRESIDING OFFICER. On this vote, the yeas are 41, the nays are 
44. Three-fifths of the Senators duly chosen and sworn not having voted 
in the affirmative, the motion is rejected, the point of order is 
sustained, and the amendment falls.
  Mr. DODD. Mr. President, I move to reconsider the vote, and I move to 
lay that motion on the table.
  The motion to lay on the table was agreed to.
  Mr. DODD. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. ROBERTS. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                    Amendment No. 4389, as Modified

  Mr. ROBERTS. Mr. President, I ask unanimous consent that the pending 
Landrieu amendment be modified to include my amendment No. 4422.
  The PRESIDING OFFICER. Without objection, the amendment will be so 
modified.
  The amendment, as modified, is as follows:

       At the end add the following:

               TITLE _--HURRICANE-RELATED CASUALTY LOSSES

     SEC. _01. USE OF AMENDED INCOME TAX RETURNS TO TAKE INTO 
                   ACCOUNT RECEIPT OF CERTAIN HURRICANE-RELATED 
                   CASUALTY LOSS GRANTS BY DISALLOWING PREVIOUSLY 
                   TAKEN CASUALTY LOSS DEDUCTIONS.

       Notwithstanding any other provision of the Internal Revenue 
     Code of 1986, if a taxpayer claims a deduction for any 
     taxable year with respect to a casualty loss to a personal 
     residence (within the meaning of section 121 of such Code) 
     resulting from Hurricane Katrina or Hurricane Rita and in a 
     subsequent taxable year receives a grant under Public Law 
     109-148, 109-234, or 110-116 as reimbursement for such loss 
     from the State of Louisiana or the State of Mississippi, such 
     taxpayer may elect to file an amended income tax return for 
     the taxable year in which such deduction was allowed and 
     disallow such deduction. If elected, such amended return must 
     be filed not later than the due date for filing the tax 
     return for the taxable year in which the taxpayer receives 
     such reimbursement or the date that is 4 months after the 
     date of the enactment of this Act, whichever is later. Any 
     increase in Federal income tax resulting from such 
     disallowance shall not be subject to any penalty or interest 
     under such Code if such amended return is so filed.

                       TITLE _--GO ZONE PROPERTY

     SEC. _01. WAIVER OF DEADLINE ON CONSTRUCTION OF GO ZONE 
                   PROPERTY ELIGIBLE FOR BONUS DEPRECIATION.

       (a) In General.--Subparagraph (B) of section 1400N(d)(3) of 
     the Internal Revenue Code of 1986 is amended to read as 
     follows:
       ``(B) without regard to `and before January 1, 2009' in 
     clause (i) thereof,''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to property placed in service after December 31, 
     2007.

                TITLE _--DISASTER TAX RELIEF ASSISTANCE

     SEC. ___. TEMPORARY TAX RELIEF FOR KIOWA COUNTY, KANSAS AND 
                   SURROUNDING AREA.

       The following provisions of or relating to the Internal 
     Revenue Code of 1986 shall apply, in addition to the areas 
     described in such provisions, to an area with respect to 
     which a major disaster has been declared by the President 
     under section 401 of the Robert

[[Page 4979]]

     T. Stafford Disaster Relief and Emergency Assistance Act 
     (FEMA-1699-DR, as in effect on the date of the enactment of 
     this Act) by reason of severe storms and tornados beginning 
     on May 4, 2007, and determined by the President to warrant 
     individual or individual and public assistance from the 
     Federal Government under such Act with respect to damages 
     attributed to such storms and tornados:
       (1) Suspension of certain limitations on personal casualty 
     losses.--Section 1400S(b)(1) of the Internal Revenue Code of 
     1986, by substituting ``May 4, 2007'' for ``August 25, 
     2005''.
       (2) Extension of replacement period for nonrecognition of 
     gain.--Section 405 of the Katrina Emergency Tax Relief Act of 
     2005, by substituting ``on or after May 4, 2007, by reason of 
     the May 4, 2007, storms and tornados'' for ``on or after 
     August 25, 2005, by reason of Hurricane Katrina''.
       (3) Employee retention credit for employers affected by may 
     4 storms and tornados.--Section 1400R(a) of the Internal 
     Revenue Code of 1986--
       (A) by substituting ``May 4, 2007'' for ``August 28, 2005'' 
     each place it appears,
       (B) by substituting ``January 1, 2008'' for ``January 1, 
     2006'' both places it appears, and
       (C) only with respect to eligible employers who employed an 
     average of not more than 200 employees on business days 
     during the taxable year before May 4, 2007.
       (4) Special allowance for certain property acquired on or 
     after may 5, 2007.--Section 1400N(d) of such Code--
       (A) by substituting ``qualified Recovery Assistance 
     property'' for ``qualified Gulf Opportunity Zone property'' 
     each place it appears,
       (B) by substituting ``May 5, 2007'' for ``August 28, 2005'' 
     each place it appears,
       (C) by substituting ``December 31, 2008'' for ``December 
     31, 2007'' in paragraph (2)(A)(v),
       (D) by substituting ``December 31, 2009'' for ``December 
     31, 2008'' in paragraph (2)(A)(v),
       (E) by substituting ``May 4, 2007'' for ``August 27, 2005'' 
     in paragraph (3)(A),
       (F) by substituting ``January 1, 2009'' for ``January 1, 
     2008'' in paragraph (3)(B), and
       (G) determined without regard to paragraph (6) thereof.
       (5) Increase in expensing under section 179.--Section 
     1400N(e) of such Code, by substituting ``qualified section 
     179 Recovery Assistance property'' for ``qualified section 
     179 Gulf Opportunity Zone property'' each place it appears.
       (6) Expensing for certain demolition and clean-up costs.--
     Section 1400N(f) of such Code--
       (A) by substituting ``qualified Recovery Assistance clean-
     up cost'' for ``qualified Gulf Opportunity Zone clean-up 
     cost'' each place it appears, and
       (B) by substituting ``beginning on May 4, 2007, and ending 
     on December 31, 2009'' for ``beginning on August 28, 2005, 
     and ending on December 31, 2007'' in paragraph (2) thereof.
       (7) Treatment of public utility property disaster losses.--
     Section 1400N(o) of such Code.
       (8) Treatment of net operating losses attributable to storm 
     losses.--Section 1400N(k) of such Code--
       (A) by substituting ``qualified Recovery Assistance loss'' 
     for ``qualified Gulf Opportunity Zone loss'' each place it 
     appears,
       (B) by substituting ``after May 3, 2007, and before on 
     January 1, 2010'' for ``after August 27, 2005, and before 
     January 1, 2008'' each place it appears,
       (C) by substituting ``May 4, 2007'' for ``August 28, 2005'' 
     in paragraph (2)(B)(ii)(I) thereof,
       (D) by substituting ``qualified Recovery Assistance 
     property'' for ``qualified Gulf Opportunity Zone property'' 
     in paragraph (2)(B)(iv) thereof, and
       (E) by substituting ``qualified Recovery Assistance 
     casualty loss'' for ``qualified Gulf Opportunity Zone 
     casualty loss'' each place it appears.
       (9) Treatment of representations regarding income 
     eligibility for purposes of qualified rental project 
     requirements.--Section 1400N(n) of such Code.
       (10) Special rules for use of retirement funds.--Section 
     1400Q of such Code--
       (A) by substituting ``qualified Recovery Assistance 
     distribution'' for ``qualified hurricane distribution'' each 
     place it appears,
       (B) by substituting ``on or after May 4, 2007, and before 
     January 1, 2009'' for ``on or after August 25, 2005, and 
     before January 1, 2007'' in subsection (a)(4)(A)(i),
       (C) by substituting ``qualified storm distribution'' for 
     ``qualified Katrina distribution'' each place it appears,
       (D) by substituting ``after November 4, 2006, and before 
     May 5, 2007'' for ``after February 28, 2005, and before 
     August 29, 2005'' in subsection (b)(2)(B)(ii),
       (E) by substituting ``beginning on May 4, 2007, and ending 
     on November 5, 2007'' for ``beginning on August 25, 2005, and 
     ending on February 28, 2006'' in subsection (b)(3)(A),
       (F) by substituting ``qualified storm individual'' for 
     ``qualified Hurricane Katrina individual'' each place it 
     appears,
       (G) by substituting ``December 31, 2007'' for ``December 
     31, 2006'' in subsection (c)(2)(A),
       (H) by substituting ``beginning on June 4, 2007, and ending 
     on December 31, 2007'' for ``beginning on September 24, 2005, 
     and ending on December 31, 2006'' in subsection (c)(4)(A)(i),
       (I) by substituting ``May 4, 2007'' for ``August 25, 2005'' 
     in subsection (c)(4)(A)(ii), and
       (J) by substituting ``January 1, 2008'' for ``January 1, 
     2007'' in subsection (d)(2)(A)(ii).


                           vote explanations

  Mr. DURBIN. Mr. President, my colleague from Delaware, Senator Biden, 
was unable to get back to the Capitol in time for the two rollcall 
votes tonight.
  He is a cochair of the Congressional Fire Services Caucus and, at the 
time of the votes tonight, he was addressing his many friends in the 
fire service who were attending the 20th Annual National Fire and 
Emergency Services Dinner.
  Mrs. BOXER. Mr. President, had I been present for the vote today to 
table the Durbin amendment to help families save their homes in 
bankruptcy, I would have cast a vote of nay. I am a cosponsor and 
strong supporter of the Durbin proposal, which could have helped more 
than 600,000 of these financially troubled families keep their homes by 
allowing them to modify their mortgages in bankruptcy.
  Mr. ROBERTS. I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. DODD. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.

                          ____________________