Preservation Approval Process Improvement Act of 2007

Mr. President, I ask unanimous consent that the Committee on Banking, Housing, and Urban Affairs be authorized to meet during the session of the Senate on Wednesday, May 16, 2007, at 9:30 a.m. to mark up an original bill entitled Foreign Investment and National Security Act of 2007; an original bill to make technical corrections to title III of SAFETEA-LU; H.R. 1675, Preservation Approval Process Improvement Act of 2007; H.R. 1676, Native American Home Ownership Opportunity Act of 2007; S. 254, a bill to award posthumously a Congressional Gold Medal to Constantino Brumidi; an original bill entitled the International Emergency Economic Powers Enforcement Act of 2007; and to vote on the nominations of Mr. David George Nason, of Rhode Island, to be Assistant Secretary of the Treasury for Financial Institutions; Mr. Mario Mancuso, of New York, to be Under Secretary of Commerce for Export Administration; Mr. Michael W. Tankersley, of Texas, to be Inspector General of the Export-Import Bank of the United States; Mr. Robert M. Couch, of Alabama, to be General Counsel of the Department of Housing and Urban Development; Ms. Janis Herschkowitz, of Pennsylvania, to be a member of the board of directors of the National Consumer Cooperative Bank; Mr. David George Nason, of Rhode Island, to be a member of the board of directors of the National Consumer Cooperative Bank; and Dr. Nguyen Van Hanh, of California, to be a member of the board of directors of the National Consumer Cooperative Bank.

Committee on commerce, Science, and Transportation

Mr. President, I ask unanimous consent that the Committee on Commerce, Science, and Transportation be authorized to hold a business meeting during the session of the Senate on Wednesday, May 16, 2007, at 2:30 p.m., in room 253 of the Russell Senate Office Building. The purpose of this meeting will be to consider and approve S. 1300, S. 694, the nomination of David James Gribbin, IV, to be General Counsel of the United States Department of Transportation, and nominations for promotion in the United States Coast Guard.

Mr. President, I ask unanimous consent that the Committee on Finance be authorized to meet during the session of the Senate on Wednesday, May 16, 2007, at 10 a.m., in 215 Dirksen Senate Office Building, to hear testimony on ``U.S. Preference Programs: How well do they work?''

Mr. President, I ask unanimous consent that the Senate Committee on the Judiciary be authorized to conduct a hearing entitled, ``Rogue Online Pharmacies: The Growing Problem of Internet Drug Trafficking'' on Wednesday, May 16, 2007 at 10 a.m. in Dirksen Senate Office Building Room 226.

Witness list: Francine H. Haight, Founder of Ryan's Cause, Laguna Niguel, CA; Joseph T. Rannazzisi, Deputy Assistant Administrator, Office of Diversion Control, Drug Enforcement Administration, Arlington, VA; Joseph A. Califano, Jr., Chairman and President, National Center on Addiction and Substance Abuse at Columbia University, Former Secretary of Health, Education and Welfare, New York, NY; Philip B. Heymann, James Barr Ames Professor of Law, Harvard Law School, Former Deputy U.S. Attorney General, Cambridge, MA; Thomas McClellan, Ph.D., Executive Director, Treatment Research Institute, University of Pennsylvania, Philadelphia, PA.

Mr. President, I ask unanimous consent that the Committee on Small Business and Entrepreneurship be authorized to meet during the session of the Senate for a markup of S. 1256 ``Small Business Lending Reauthorization and Improvements Act of 2007'' on Wednesday, May 16, 2007, beginning at 2 p.m. in room 428A of the Russell Senate Office Building.

Mr. President, I ask unanimous consent that the Committee on Veterans' Affairs be auhorized to meet during the session of the Senate on Wednesday, May 16, 2007, to hold a hearing on the nomination of Dr. Michael J. Kussman to be Under Secretary for Health of the Department of Veterans Affairs. The hearing will take place in room 562 of the Dirksen Senate Office Building beginning at 10 a.m.

Mr. President, I ask unanimous consent that the Joint Economic Committee be authorized to conduct a hearing entitled, ``Are the Explosive Costs of Elder Care Hurting Family Finances and Business Competition?, in room 216 of the Hart Senate Office Building, Wednesday, May 16, 2007, from 9:30 a.m. to 12 p.m.

Mr. President, I ask unanimous consent that the Special Committee on Aging be authorized to meet on Wednesday, May 16, 2007, from 10:30 a.m. to 12:30 p.m. in Dirksen 106 for the purpose of conducting a hearing regarding Medicare Advantage, Marketing, and Sales.

Mr. President, I ask unanimous consent that the Subcommittee on Clean Air and Nuclear Safety be authorized to meet during the session of the Senate on Wednesday, May 16, 2007, at 10 a.m. in room 406 of the Dirksen Senate Office Building.

Agenda

``The State of Mercury Regulation, Science, and Technology.''

Madam Speaker, I yield myself such time as I may consume.

Madam Speaker, I rise in support of H.R. 1675, the Preservation Approval Process Improvement Act of 2007, introduced by Representative Melissa Bean, Financial Institution Subcommittee Ranking Member Paul Gillmor, and Full Committee Chairman Barney Frank.

1675 addresses problems with HUD's processing of previous participation certificate or HUD's form 2530 under HUD's automated partners performances system.

Specifically, this legislation suspends the electronic filing requirement for the previous participation certificates and the filing requirements of these certificates for certain low-income housing investors. Form 2530 has been used for many years to ascertain the prior record of participants in certain HUD programs. This enabled HUD to refuse to do business with participants who have not previously carried out their obligations. However, passive investor disclosure requirements have created problems for private individuals and groups who wish to participate in the construction and preservation of affordable housing through the low-income housing tax credit program.

The 2530 process is designed to review principals, including any limited partner, with a 25 percent or greater interest in property. These rules were developed long before low-income housing tax credit programs were actually created. Low-income housing tax credit deals with the typical investors or institutions, that is, publicly traded and regulated national and multi-national financial institutions, including government sponsored enterprises whose reputation is well established.

Under the 2530 process, officers, directors, and stockholders with 10 percent or greater holdings are required to submit their names, Social Security numbers, as well as their individual and prior record with HUD. Industry groups have objected to these disclosure requirements as they are passive investor partners and are not involved in the construction, maintenance, and operation of the property. They claim that these reporting requirements are costly, time intensive, and deter investment in affordable housing. Investors developers, syndicators, and others have contacted HUD to ask that passive investors be exempted from filing with HUD.

In December 2005, former Chairman Oxley requested that HUD extend the opportunity for paper filing, and asked HUD to explain why passive investors should be required to file. HUD allowed the paper filing until June 30, 2006. In December 2006, after repeated inquiries from the Financial Services Committee and requests from interested parties to provide relief, HUD sent the committee a proposal that, according to the industry, made filing more burdensome in many respects.

On December 21, 2006, noting that HUD's applications for 2530 filing requirements have become broad and overreaching and, in some cases, unnecessarily delayed or even prevented HUD transactions that were beneficial to people in need of housing, Chairman Frank, Ranking Member Bachus, Chairman Waters, and Chairman Oxley asked HUD to discuss the matter further with interested parties before taking any action on the proposed rule. Since then, however, HUD has not taken any overt action to amend the proposal.

H.R. 1675, the Preservation Approval Process Improvement Act of 2007, requires that HUD take action to alleviate the concerns mentioned above in order to encourage private sector participation in affordable housing programs.

HUD's current 2530 previous participation review process is intended as a risk assessment tool, but in many ways has been a barrier with housing preservation because the current regulations in the accompanying electronic system that process 2530 submissions do not reflect the complexity of today's real estate transactions. The reporting requirements are unduly burdensome and offer no additional benefit to HUD.

To this end, H.R. 1675 requires that HUD suspend mandatory previous participation filings through the APPS computer program, and that it allow paper filing until HUD submits to Congress a revised draft that would eliminate unnecessary filing burdens.

In addition, this legislation eliminates the requirement to file a 2530 form for passive investors who expect to own entities that are allowed or expected to be allowed in low-income housing tax credits.

Madam Speaker, I urge my colleagues to support this legislation.

Madam Speaker, I reserve the balance of my time.

Madam Speaker, I yield back the balance of my time.

Madam Speaker, I move to suspend the rules and pass the bill (H.R. 1675) to suspend the requirements of the Department of Housing and Urban Development regarding electronic filing of previous participation certificates and regarding filing of such certificates with respect to certain low-income housing investors.

Madam Speaker, I ask unanimous consent that all Members may have 5 legislative days within which to revise and extend their remarks on this legislation and to insert extraneous material thereon.

Madam Speaker, I yield myself such time as I may consume.

The Preservation Approval Process Improvement Act of 2007, introduced by myself and Representative Gillmor, was recently reported out of the Committee on Financial Services without objection, and I am pleased it is being given consideration on the House floor today. In addition to expressing my appreciation to Chairman Frank, Ranking Member Bachus, and Housing Subcommittee Chairwoman Waters, I would especially like to thank my colleague from Ohio (Mr. Gillmor) in moving this bill forward and his efforts to address the regulatory barriers impacting the investment in affordable housing.

I am also very appreciative of the expert assistance provided by the House Financial Services Committee staff, including Jeff Riley and Cindy Chetti, who have been working on this issue for more than 1\1/2\ years.

H.R. 1675 will reduce burdens caused by HUD's unnecessarily complex regulation of its previous participation reporting requirements, known as the 2530 process.

Written many years ago when small mom-and-pop companies were investing in affordable housing, HUD's regulations governing the 2530 process are no longer in sync with the type of real estate transactions being conducted today. As a result, when applied to the more typical investor of today, these regulations impose huge administrative and regulatory hurdles. The application of these cumbersome regulations was made worse last summer when HUD automated the 2530 process using an electronic system known as APPS. In addition to being difficult to navigate, the APPS system experiences technical difficulties almost daily and has led to a number of security breaches involving personal data.

As a result, H.R. 1675 will suspend the requirement that 2530 filings be done through HUD's electronic APPS system. Participants may choose to continue to use APPS, but HUD must permit other participants to submit 2530 paper filings. The suspension of HUD's requirement that all filings be done through APPS will continue until HUD revises the 2530 rules to eliminate unnecessary burdens and disincentives for all participants. The revised regulations are to be submitted to the Committee on Financial Services as well as to the Senate Banking Committee for review.

Further, the bill requires the HUD Secretary to immediately suspend all filing requirements under the previous participation process for limited liability corporate investors owning an interest in entities that receive low-income housing tax credits. Limited liability corporate investors have no operational control over properties and pose no risk to the Department. The investors are simply providing much needed capital to build affordable housing for low-income Americans, and such investment should not be inadvertently discouraged by outdated, burdensome regulations.

I submit for printing in the Record a letter addressed to Chairman Frank and Representative Bachus from nearly 30 organizations endorsing this legislation, including the National Association of Realtors, National Multi-Housing Council, the National Association of State and Local Equity Funds, and many more.

It is time for us to bring a commonsense approach to affordable housing. In passing this bill we will be taking an important step toward encouraging investment in such housing options and reducing unnecessary regulatory roadblocks.

March 27, 2007.

Hon. Barney Frank,

Chairman, House Committee on Financial Services, Washington,

I have no further requests for time, and I reserve the balance of our time.

Madam Speaker, I would just say this is a bill where we had strong bipartisan support, and while technology didn't work in the case of the APPS system, bipartisanship did.

I yield back the balance of my time.

Madam Speaker, I move to suspend the rules and pass the bill (H.R. 1676) to reauthorize the program of the Secretary of Housing and Urban Development for loan guarantees for Indian housing.

Madam Speaker, I ask unanimous consent that all Members may have 5 legislative days within which to revise and extend their remarks on this legislation and to insert extraneous material thereon.

Madam Speaker, I yield myself such time as I may consume.

Madam Speaker, I rise today in support of H.R. 1676, the Native American Home Ownership Opportunity Act of 2007, reauthorizing the section 184 Indian Loan Program.

Madam Speaker, I thank Chairman Frank and Subcommittee Chairwoman

Waters for their hard work in making this legislation a priority and recognizing the importance of the section 184 program.

This program offers home ownership, property rehabilitation, new construction and refinance opportunities for Native Americans. The primary purpose of the section 184 program is a 100 percent loan guarantee program for Native American families seeking home ownership who are members of participating tribes; 196 federally recognized tribes participate in this program, including 24 tribes from my home State of Oklahoma. Therefore, this program works by increasing home ownership in Indian country and improving the quality of life in Indian communities. Without argument, this program increased Native American home ownership in Oklahoma and throughout Indian country across the Nation.

Section 184 is administered by the Department of Housing and Urban Development's Office of Native American Programs, created in 1992 to address the lack of private mortgage capital in Indian country, and authorizing HUD to guarantee loans made by private lenders to Native Americans.

The section 184 program guarantees single-family residential loans for Native American borrowers, and provides for a 100 percent guarantee of the outstanding principal and interest and payment of other necessary and allowable expenses. The flexible underwriting, low down payment, higher loan limits, loan guarantee fee, and absence of income limits make this the most affordable loan program available to tribal areas.

Madam Speaker, I reserve the balance of my time.

Madam Speaker, I continue to reserve the balance of my time.

Madam Speaker, I yield myself such time as I may consume.

I want to thank also my friends, Congressmen Neugebauer from Texas and Renzi from Arizona for their work on this legislation and for their bipartisan effort here.

According to HUD, 4,200 loans have been guaranteed since the inception of the program, totaling $517 million. As lenders have become more comfortable with making loans secured by land in Indian country, interest in this program has only increased. My home State of Oklahoma represents 34 percent of the total loans guaranteed through section 184, thereby increasing the number of my constituents who have access to home ownership.

Again, I want to thank Chairman Frank and Subcommittee Chairwoman Waters for recognizing the importance of the section 184 program in Indian country.

Madam Speaker, I have no further requests for time, and I yield back the balance of my time.

Madam Speaker, I yield myself as much time as I may consume.

Madam Speaker, I rise in support of H.R. 1676, the Native American Home Ownership Opportunity Act of 2007, introduced by Congressman Boren and Congressman Renzi.

This important legislation authorizes section 184 of the Housing and Community Development Act of 1992, which established a loan guarantee program for Native American families, Indian Housing Authorities and federally recognized Native American tribes.

Under current law this program is authorized through 2007. This bill will reauthorize the program through 2012.

Congress established this program to provide access to private mortgage financing for Native American families, Indian Housing Authorities and federally recognized Native American tribes that could not otherwise acquire housing financing because of the unique legal status of Native American lands.

This loan guarantee under this program is used to construct, acquire, refinance or rehabilitate single-family housing located on trust land or land located in an Indian or an Alaska native area.

Section 184 of the program guarantees single family, one- to four- family units, residential loans for homes located in these Indian and Alaska native areas where land may be tribal trust, allotted individual trust or fee simple. HUD offers 100 percent guarantee on the outstanding principal and interest and payment of necessary and allowable expenses.

The flexible underwriting, low down payment, higher loan limits, low guarantee fee and the absence of income limits make this the most affordable loan program available in tribal areas.

In 2007, about $6 million was appropriated for the loan guarantee program. Consequently, CBO has estimated that H.R. 1675 will cost about $30 million over the 2008-2012 period if appropriators continue the funding at the level similar to previous years. Enacting this bill does not affect direct spending or revenues.

Madam Speaker, this legislation was approved by the Committee on Financial Services by voice vote, and I urge the passage of this legislation.

Madam Speaker, I reserve the balance of my time.

Madam Speaker, it is my honor at this time to yield 3 minutes to the gentleman from Arizona (Mr. Renzi), who is one of the authors of this legislation and someone who has worked tirelessly for Native American issues all across the country and particularly in his home State of Arizona.

Madam Speaker, I have no further speakers, and I yield back the balance of my time.