[House Report 111-163]
[From the U.S. Government Publishing Office]


111th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 1st Session                                                    111-163

======================================================================



 
WAIVER OF HOUSING LOAN FEE FOR CERTAIN VETERANS WITH SERVICE-CONNECTED 
                 DISABILITIES CALLED TO ACTIVE SERVICE

                                _______
                                

 June 18, 2009.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

  Mr. Filner, from the Committee on Veterans' Affairs, submitted the 
                               following

                              R E P O R T

                        [To accompany H.R. 2180]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Veterans' Affairs, to whom was referred 
the bill (H.R. 2180) to amend title 38, United States Code, to 
waive housing loan fees for certain veterans with service-
connected disabilities called to active service, having 
considered the same, report favorably thereon without amendment 
and recommend that the bill do pass.










                                CONTENTS

                                                                   Page
Purpose and Summary..............................................     2
Background and Need for Legislation..............................     2
Hearings.........................................................     3
Subcommittee Consideration.......................................     3
Committee Consideration..........................................     3
Committee Votes..................................................     3
Committee Oversight Findings.....................................     3
Statement of General Performance Goals and Objectives............     3
New Budget Authority, Entitlement Authority, and Tax Expenditures     4
Earmarks and Tax and Tariff Benefits.............................     4
Committee Cost Estimate..........................................     4
Congressional Budget Office Estimate.............................     4
Federal Mandates Statement.......................................     5
Advisory Committee Statement.....................................     5
Constitutional Authority Statement...............................     5
Applicability to Legislative Branch..............................     5
Section-by-Section Analysis of the Legislation...................     5
Changes in Existing Law Made by the Bill as Reported.............     5

                          Purpose and Summary

    H.R. 2180 was introduced on April 29, 2009, by 
Representative Harry Teague of New Mexico. H.R. 2180 would 
waive housing loan fees for certain veterans with service-
connected disabilities called back to active service.

                  Background and Need for Legislation

    The Department of Veterans Affairs (VA) Home Loan Program 
was first enacted into law in 1944 with the enactment of the 
Servicemen's Readjustment Act, also known as the G.I. Bill of 
Rights. This law provided servicemembers returning from World 
War II with housing assistance. Many of these veterans were 
able to purchase their first home with the assistance of the 
G.I. Bill of Rights.
    The VA Home Loan Program provides veterans with VA-
guaranteed low or no down payment loans in order to promote 
home ownership by veterans by encouraging lender participation. 
The guaranty is also used to protect the lender against loss if 
a veteran fails to repay or defaults on the loan.
    The VA loan funding fee was first instituted in Public Law 
97-253 (96 Stat. 763), the Omnibus Budget Reconciliation Act of 
1982. Funding fees are used to offset the costs of paying 
claims and other expenses incurred by the VA.
    Except as waived, a housing loan funding fee is normally 
required when purchasing or refinancing a home. The funding fee 
percentage varies from 0.5 percent to 3.3 percent depending on 
several variables, including whether the veteran is a first-
time homebuyer or if the veteran is putting a down payment or 
is a member of the active or reserve components.
    Public Law 106-419 (114 Stat. 1822) substantially re-wrote 
the loan fee provision and authorized a waiver of the funding 
fee for certain veterans receiving compensation or to a 
qualified surviving spouse. Public Law 108-454 (118 Stat. 3598) 
provided fee waivers for veterans receiving disability 
compensation due to service-connected disability discharge and 
rating. The fee waiver could be granted once the rating has 
been determined and prior to receiving compensation.
    A funding fee waiver is currently granted to veterans but 
only on a case-by-case basis and the VA has the discretion to 
determine who would receive this waiver. Current funding fee 
waivers for VA home loans are granted to veterans who are 
receiving disability compensation for service-related medical 
issues, who are entitled to get compensation if they are not 
receiving retirement pay, and surviving spouses of those who 
died in the service or from service-related disabilities.
    The Committee believes that the original drafters of the 
funding fee waivers did not foresee that a disabled veteran 
would be called to return to active duty. Our Country's current 
conflicts have placed a tremendous burden on our men and women 
in uniform with some veterans of the reserve components with 
service-connected disabilities being called back to military 
service. The Committee is aware of cases where injured veterans 
have not been provided equitable funding fee waivers because 
they have been called back to active duty. Section 3729(c) of 
title 38, United States Code, limits waiver of the funding fee 
for those with service-connected disabilities or those 
receiving retirement pay, thus preventing those who are serving 
on active duty from receiving fee waivers.

                                Hearings

    On May 21, 2009, the Subcommittee on Economic Opportunity 
conducted a legislative hearing on various bills introduced 
during the 111th Congress, including H.R. 2180. The following 
witnesses testified: The Honorable Mike Coffman of Colorado; 
Richard Daley, Associate Legislation Director, Paralyzed 
Veterans of America; John L. Wilson, Associate National 
Legislative Director, Disabled American Veterans; Mark Seavey, 
Assistant Director, National Legislative Commission, The 
American Legion; Raymond C. Kelley, National Legislative 
Director, AMVETS; Cpl. Wade J. Spann, USMC, Wounded Warrior 
Project; Keith M. Wilson, Director, Education Service, Veterans 
Benefits Administration, U.S. Department of Veterans Affairs, 
accompanied by John Brizzi, Deputy Assistant General Counsel, 
U.S. Department of Veterans Affairs; and, John C. McWilliam, 
Deputy Assistant Secretary, Veterans' Employment and Training 
Service, U.S. Department of Labor. Submitting a statement for 
the record included: The Honorable Bob Filner of California.

                       Subcommittee Consideration

    On June 4, 2009, the Subcommittee on Economic Opportunity 
met in open markup session and ordered H.R. 2180 favorably 
forwarded to the full Committee by voice vote.

                        Committee Consideration

    On June 10, 2009, the full Committee met in an open markup 
session, a quorum being present, and ordered H.R. 2180 reported 
favorably to the House of Representatives by voice vote.

                            Committee Votes

    Clause 3(b) of rule XIII of the Rules of the House of 
Representatives requires the Committee to list the record votes 
on the motion to report the legislation and amendments thereto. 
There were no record votes taken on amendments or in connection 
with ordering H.R. 2180 reported to the House. A motion by Mr. 
Stearns of Florida to order H.R. 2180 reported favorably to the 
House of Representatives was agreed to by voice vote.

                      Committee Oversight Findings

    In compliance with clause 3(c)(1) of rule XIII and clause 
(2)(b)(1) of rule X of the Rules of the House of 
Representatives, the Committee's oversight findings and 
recommendations are reflected in the descriptive portions of 
this report.

         Statement of General Performance Goals and Objectives

    In accordance with clause 3(c)(4) of rule XIII of the Rules 
of the House of Representatives, the Committee's performance 
goals and objectives are reflected in the descriptive portions 
of this report.

   New Budget Authority, Entitlement Authority, and Tax Expenditures

    In compliance with clause 3(c)(2) of rule XIII of the Rules 
of the House of Representatives, the Committee adopts as its 
own the estimate of new budget authority, entitlement 
authority, or tax expenditures or revenues contained in the 
cost estimate prepared by the Director of the Congressional 
Budget Office pursuant to section 402 of the Congressional 
Budget Act of 1974.

                  Earmarks and Tax and Tariff Benefits

    H.R. 2180 does not contain any congressional earmarks, 
limited tax benefits, or limited tariff benefits as defined in 
clause 9(d), 9(e), or 9(f) of rule XXI of the Rules of the 
House of Representatives.

                        Committee Cost Estimate

    The Committee adopts as its own the cost estimate on H.R. 
2180 prepared by the Director of the Congressional Budget 
Office pursuant to section 402 of the Congressional Budget Act 
of 1974.

               Congressional Budget Office Cost Estimate

    Pursuant to clause 3(c)(3) of rule XIII of the Rules of the 
House of Representatives, the following is the cost estimate 
for H.R. 2180 provided by the Congressional Budget Office 
pursuant to section 402 of the Congressional Budget Act of 
1974:

                                     U.S. Congress,
                               Congressional Budget Office,
                                     Washington, DC, June 16, 2009.
Hon. Bob Filner,
Chairman, Committee on Veterans' Affairs,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 2180, a bill to 
waive housing loan fees for certain veterans with service-
connected disabilities called to active service.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is David Newman.
            Sincerely,
                                              Douglas W. Elmendorf.
    Enclosure.

H.R. 2180--A bill to amend title 38, United States Code, to waive 
        housing loan fees for certain veterans with service-connected 
        disabilities called to active service

    H.R. 2180 would direct the Department of Veterans Affairs 
(VA) to waive its mortgage funding fee for certain reservists 
who have been called to active duty. VA collects a fee from 
most veterans when it guarantees their mortgage loans, but 
waives the fee for veterans who are receiving disability 
compensation. Some reservists receive disability compensation, 
but must forfeit such payments while they are receiving pay for 
active military service. As a result, they lose eligibility for 
the fee waivers for the period of their active duty service.
    H.R. 2180 would allow continued eligibility for fee waivers 
for such activated reservists. Under the bill, CBO estimates 
that fewer than 10 additional veterans a year would receive a 
fee waiver, which would result in forgone receipts of less than 
$50,000 per year. Thus, CBO estimates that enacting the bill 
would have an insignificant effect on direct spending and no 
effect on revenues. In addition, CBO expects that implementing 
H.R. 2180 would not affect discretionary spending.
    H.R. 2180 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act and 
would not affect the budgets of state, local, or tribal 
governments.
    The CBO staff contact for this estimate is David Newman. 
The estimate was approved by Theresa Gullo, Deputy Assistant 
Director for Budget Analysis.

                       Federal Mandates Statement

    The Committee adopts as its own the estimate of Federal 
mandates regarding H.R. 2180 prepared by the Director of the 
Congressional Budget Office pursuant to section 423 of the 
Unfunded Mandates Reform Act.

                      Advisory Committee Statement

    No advisory committees within the meaning of section 5(b) 
of the Federal Advisory Committee Act would be created by H.R. 
2180.

                   Constitutional Authority Statement

    Pursuant to clause 3(d)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee finds that the 
Constitutional authority for H.R. 2180 is provided by Article 
I, section 8 of the Constitution of the United States.

                  Applicability to Legislative Branch

    The Committee finds that the legislation does not relate to 
the terms and conditions of employment or access to public 
services or accommodations within the meaning of section 
102(b)(3) of the Congressional Accountability Act.

             Section-by-Section Analysis of the Legislation


Section 1. Waiver of housing loan fee for certain veterans with 
        service-connected disabilities called to active service.

    This section provides that a fee may not be collected from 
a qualified service-disabled veteran who is called back to 
active service.

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (new matter is 
printed in italic and existing law in which no change is 
proposed is shown in roman):

TITLE 38, UNITED STATES CODE

           *       *       *       *       *       *       *


PART III--READJUSTMENT AND RELATED BENEFITS

           *       *       *       *       *       *       *


CHAPTER 37--HOUSING AND SMALL BUSINESS LOANS

           *       *       *       *       *       *       *


SUBCHAPTER III--ADMINISTRATIVE PROVISIONS

           *       *       *       *       *       *       *


Sec. 3729. Loan fee

  (a) * * *

           *       *       *       *       *       *       *

  (c) Waiver of Fee.--(1) A fee may not be collected under this 
section from a veteran who is receiving compensation (or who, 
but for the receipt of retirement pay or active service pay, 
would be entitled to receive compensation) or from a surviving 
spouse of any veteran (including a person who died in the 
active military, naval, or air service) who died from a 
service-connected disability.

           *       *       *       *       *       *       *


                                  
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