Workforce Housing Construction for the GO Zone Act of 2007

Mr. President, today, I am introducing the Credit Card Minimum Payment Warning Act. I thank Senators Durbin, Leahy, and Schumer for cosponsoring this legislation.

Too many consumers in our country are burdened by significant credit card debt. Revolving debt, mostly comprised of credit card debt, has risen from $54 billion in 1980 to more than $883 billion in 2007.

We must make consumers more aware of the long-term effects of their financial decisions, particularly in managing credit card debt. While it is relatively easy to obtain credit, especially on college campuses, not enough is being done to ensure that credit is properly managed. Currently, credit card statements fail to include vital information that would allow individuals to make fully informed financial decisions. Additional disclosure is needed to ensure that consumers completely understand the implications of their credit card use and the costs of only making the minimum payments.

The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 included a requirement that credit card issuers provide information to consumers about the consequences of only making the minimum monthly payment. However, this requirement fails to provide the detailed information on billing statements that consumers need to know to make informed decisions. The bankruptcy law allows credit card issuers a choice between disclosure statements. The first option included in the bankruptcy bill would require a standard ``Minimum Payment Warning.'' The generic warning would state that it would take 88 months to pay off a balance of $1,000 for bank card holders or 24 months to pay off a balance of $300 for retail card holders. This first option also includes a requirement that a toll-free number be established that would provide an estimate of the time it would take to pay off the customer's balance. The Federal Reserve Board is required to establish the table that would estimate the approximate number of months it would take to pay off a variety of account balances.

There is a second option that the law permits. The second option allows the credit card issuer to provide a general minimum payment warning and provide a toll-free number that consumers could call for the actual number of months to repay the outstanding balance.

The options available under the Bankruptcy Reform law are woefully inadequate. They do not require issuers to provide their customers with the total amount they would pay in interest and principal if they chose to pay off their balance at the minimum rate. Since the average household with debt carries a balance of approximately $10,000 to $12,000 in revolving debt, a warning based on a balance of $1,000 will not be helpful. The minimum payment warning included in the first option underestimates the costs of paying a balance off at the minimum payment. If a family has a credit card debt of $10,000, and the interest rate is a modest 12.4 percent, it would take more than ten and a half years to pay off the balance while making minimum monthly payments of four percent.

My legislation would make it very clear what costs consumers will incur if they make only the minimum payments on their credit cards. If the Credit Card Minimum Payment Warning Act is enacted, the personalized information consumers would receive for their accounts would help them make informed choices about their payments toward reducing outstanding debt.

My bill requires a minimum payment warning notification on monthly statements stating that making the minimum payment will increase the amount of interest that will be paid and extend the amount of time it will take to repay the outstanding balance. The legislation also requires companies to inform consumers of how many years and months it will take to repay their entire balance if they make only minimum payments. In addition, the total cost in interest and principal, if the consumer pays only the minimum payment, would have to be disclosed. These provisions will make individuals much more aware of the true costs of their credit card debt. The bill also requires that credit card companies provide useful information so that people can develop strategies to free themselves of credit card debt. Consumers would have to be provided with the amount they need to pay to eliminate their outstanding balance within 36 months.

Finally, the legislation requires that creditors establish a toll- free number so that consumers can access trustworthy credit counselors. In order to ensure that consumers are referred only to trustworthy credit counseling organizations, these agencies would have to be approved by the Federal Trade Commission and the Federal Reserve Board as having met comprehensive quality standards. These standards are necessary because certain credit counseling agencies have abused their nonprofit, tax-exempt status and taken advantage of people seeking assistance in managing their debt.

In a report on customized minimum payment disclosures released in April 2006, the Government Accountability Office (GAO) found that consumers who typically carry credit balances found customized disclosures very useful and would prefer to receive them in their billing statements.

We must provide consumers with detailed personalized information to assist them in making better informed choices about their credit card use and repayment. Our bill makes clear the adverse consequences of uninformed choices, such as making only minimum payments, and provides opportunities to locate assistance to better manage credit card debt.

My bill is necessary to improve credit card disclosures so that consumers are provided relevant and useful information that hopefully will bring about positive behavior change among consumers. Consumers with lower debt levels will be better able to purchase a home, pay for their child's education, or retire comfortably on their own terms.

I will ask that a letter of support from the Consumer Federation of America, the Center for Responsible Lending, Consumer Action, Consumers Union, Demos, the National Association of Consumer Advocates, U.S. Public Interest Research Group, the National Council of La Raza, and the National Consumer Law Center be printed in the Record.

I will also ask that the text of the Credit Card Minimum Payment Warning Act be printed in the Record.

I urge my colleagues to support this important legislation that will empower consumers by providing them with detailed personalized information to assist them in making informed choices about their credit card use and repayment. This bill makes clear the adverse consequences of uninformed choices such as making only minimum payments and provides opportunities to locate assistance to reduce credit card debt.

Mr. President, I ask unanimous consent that the aforementioned materials be printed in the Record.

Mr. President, as the gulf coast recovers from Katrina and Rita, rebuilding our housing remains the key to our recovery. I have talked about this issue on this floor before. We need housing so that our citizens have a place to live while they rebuild our businesses, restore our infrastructure, and renew our communities. Congress and the President responded by making billions of dollars available to us and we are grateful for this assistance.

I am proud to say that this assistance is working. Every time I go home I see signs of improvement. They are often small: a gas station or a store reopening on a corner; children playing on a street where no one lived only a few months before. I wish I could say that these signs are everywhere, but they are not. Some parts of New Orleans are doing well, some are not. We knew from the start that recovery would take longer in some areas than in others; and we all knew that nothing would happen overnight.

America has never rebuilt a city of 500,000 people before. Our experience in Louisiana and in the Gulf has taught us some valuable lessons about postcatastrophe rebuilding and recovery. We have learned about the shortcomings of government programs at FEMA, the Small Business Administration, and other agencies. In responding to Katrina they used the systems that worked great for smaller disasters, but were woefully inadequate for larger ones. For future megacatastrophes we now understand that it may take government programs several months to ramp up before they are in a position to distribute assistance.

One of the key lessons we have learned from this catastrophe has been the affect of such massive destruction

and displacement on the supply and the costs of labor and building materials, and the impact these have on how long it takes to rebuild. New Orleans, for example, is about half the population it used to be. We do not have enough workers in building and contracting to meet the huge demand we have for this work. As a result, it may take several months to get building started. Developers are also having difficulty getting insurance and the infrastructure in many areas is still heavily damaged.

This timing delay means that Congress will have to reexamine the policies that we have enacted to help rebuild the Gulf region in order to ensure that they are meeting the new kinds of disaster recovery challenges Katrina and Rita have posed. The Gulf Opportunity Zone Act of 2005 was one of the major pieces of legislation that we passed. The GO Zone Act provided important tax incentives to encourage investment in businesses and housing in the Gulf.

To help ensure that we can rebuild our housing, GO Zone Act increased the state's allocation of Low Income Housing Tax Credits, LIHTC. These credits finance affordable and mixed income housing. Under the GO Zone Act, any housing developed with these tax credits must be built and operating by December 31, 2008. The statute refers to this as the ``placed in service'' date. This date is consistent with the normal LIHTC program guidelines that require tax credit housing developments to be placed in service within 2 years of allocation.

The Louisiana Housing Finance Agency, LHFA, reports that there was a great demand for these GO Zone credits. For the credits allocated in 2006, the LHFA received 266 applications from developers for more than $253 million. But it only funded 102 projects with $56.9 million in tax credits.

For 2007 and 2008, however, the State received far fewer applications. The reason for this is because of the placed-in-service date. Because of the labor shortage, increased costs, and lack of insurance that we are facing in the Gulf, developers are not sure whether they can get their projects placed in service by the end of 2008. Yet there is still a huge need for the housing that these credits will fund.

The placed-in-service date is also raising new concerns. I have heard from a number of organizations that already received tax credit allocations before 2006 who are concerned that they will not be able to get their developments placed in service by the end of 2008. The LHFA estimates that 65 percent of the affordable housing units under development in New Orleans, roughly 11,050 units, will not make the deadline to be available for rent by the end of 2008. In the surrounding parishes, home sales prices have literally hit the roof meaning working and middle-income families cannot reasonably justify living in the area that they still call home, 19 months since the storm. Again, the culprit is the shortages and increased costs that I mentioned before. Some developers have even told me that they face losing credits that had been allocated to them before the storm because building has been delayed in the region. Since Katrina, rental prices have increased by 39 percent.

Today, I am introducing legislation that will help to ensure that these housing tax credits are available so that we can continue the road to recovery. The Workforce Housing for the GO Zone Act of 2007 will extend the placed-in-service date for the GO Zone Low Income Housing Tax Credit by an additional 2 years. This will allow developers to make full use of the credits that are available to build affordable housing in the Gulf Coast.

Another critical provision lets GO Zone low-income housing projects receive additional federally subsidized loans without losing tax credits. The Low Income Housing Tax Credit provisions included in this bill further assist our people to return home. These credits are competitively awarded to qualified developers and subject to constant oversight by the State housing authority to make sure that only quality affordable housing is being constructed. The citizens of the gulf coast are ready to go back home, and this legislation helps get them there.

I ask unanimous consent that a copy of the legislation be printed in the Record.

Mr. President, as the gulf coast recovers from Katrina and Rita, rebuilding our housing remains the key to our recovery. I have talked about this issue on this floor before. We need housing so that our citizens have a place to live while they rebuild our businesses, restore our infrastructure, and renew our communities. Congress and the President responded by making billions of dollars available to us and we are grateful for this assistance.

I am proud to say that this assistance is working. Every time I go home I see signs of improvement. They are often small: a gas station or a store reopening on a corner; children playing on a street where no one lived only a few months before. I wish I could say that these signs are everywhere, but they are not. Some parts of New Orleans are doing well, some are not. We knew from the start that recovery would take longer in some areas than in others; and we all knew that nothing would happen overnight.

America has never rebuilt a city of 500,000 people before. Our experience in Louisiana and in the Gulf has taught us some valuable lessons about postcatastrophe rebuilding and recovery. We have learned about the shortcomings of government programs at FEMA, the Small Business Administration, and other agencies. In responding to Katrina they used the systems that worked great for smaller disasters, but were woefully inadequate for larger ones. For future megacatastrophes we now understand that it may take government programs several months to ramp up before they are in a position to distribute assistance.

One of the key lessons we have learned from this catastrophe has been the affect of such massive destruction

and displacement on the supply and the costs of labor and building materials, and the impact these have on how long it takes to rebuild. New Orleans, for example, is about half the population it used to be. We do not have enough workers in building and contracting to meet the huge demand we have for this work. As a result, it may take several months to get building started. Developers are also having difficulty getting insurance and the infrastructure in many areas is still heavily damaged.

This timing delay means that Congress will have to reexamine the policies that we have enacted to help rebuild the Gulf region in order to ensure that they are meeting the new kinds of disaster recovery challenges Katrina and Rita have posed. The Gulf Opportunity Zone Act of 2005 was one of the major pieces of legislation that we passed. The GO Zone Act provided important tax incentives to encourage investment in businesses and housing in the Gulf.

To help ensure that we can rebuild our housing, GO Zone Act increased the state's allocation of Low Income Housing Tax Credits, LIHTC. These credits finance affordable and mixed income housing. Under the GO Zone Act, any housing developed with these tax credits must be built and operating by December 31, 2008. The statute refers to this as the ``placed in service'' date. This date is consistent with the normal LIHTC program guidelines that require tax credit housing developments to be placed in service within 2 years of allocation.

The Louisiana Housing Finance Agency, LHFA, reports that there was a great demand for these GO Zone credits. For the credits allocated in 2006, the LHFA received 266 applications from developers for more than $253 million. But it only funded 102 projects with $56.9 million in tax credits.

For 2007 and 2008, however, the State received far fewer applications. The reason for this is because of the placed-in-service date. Because of the labor shortage, increased costs, and lack of insurance that we are facing in the Gulf, developers are not sure whether they can get their projects placed in service by the end of 2008. Yet there is still a huge need for the housing that these credits will fund.

The placed-in-service date is also raising new concerns. I have heard from a number of organizations that already received tax credit allocations before 2006 who are concerned that they will not be able to get their developments placed in service by the end of 2008. The LHFA estimates that 65 percent of the affordable housing units under development in New Orleans, roughly 11,050 units, will not make the deadline to be available for rent by the end of 2008. In the surrounding parishes, home sales prices have literally hit the roof meaning working and middle-income families cannot reasonably justify living in the area that they still call home, 19 months since the storm. Again, the culprit is the shortages and increased costs that I mentioned before. Some developers have even told me that they face losing credits that had been allocated to them before the storm because building has been delayed in the region. Since Katrina, rental prices have increased by 39 percent.

Today, I am introducing legislation that will help to ensure that these housing tax credits are available so that we can continue the road to recovery. The Workforce Housing for the GO Zone Act of 2007 will extend the placed-in-service date for the GO Zone Low Income Housing Tax Credit by an additional 2 years. This will allow developers to make full use of the credits that are available to build affordable housing in the Gulf Coast.

Another critical provision lets GO Zone low-income housing projects receive additional federally subsidized loans without losing tax credits. The Low Income Housing Tax Credit provisions included in this bill further assist our people to return home. These credits are competitively awarded to qualified developers and subject to constant oversight by the State housing authority to make sure that only quality affordable housing is being constructed. The citizens of the gulf coast are ready to go back home, and this legislation helps get them there.

I ask unanimous consent that a copy of the legislation be printed in the Record.

Mr. President, this Sunday we will celebrate Earth Day, a day when we should reaffirm our commitment to a clean, safe, and healthy environment for our children and future generations.

We have made a considerable amount of progress since Senator Gaylord Nelson established the first Earth Day thirty-seven years ago. We implemented the Clean Water Act and the Clean Air Act, both landmark bills that have made our beautiful country a cleaner place to live. We no longer have rivers so massively polluted they actually catch fire and burn. We no longer have unchecked amounts of toxic pollutants being pumped into the air we breathe. We should be proud of these accomplishments because they show us that we can pass meaningful and effective laws to protect the environment and public health without sacrificing our economy and economic productivity.

We still have serious threats to the safety and health of our environment. Obviously global climate change tops that list of threats. No other single issue has the potential to devastate our future and change the entire world so completely. We have an opportunity, if we get smart and take serious actions, to stop the cataclysmic changes that are just around the corner for this planet. The time to act is now. And I mean right now. Every year that we delay enacting a strong bill that forces us to make mandatory reductions to our carbon emissions the cost goes up. We simply cannot afford to wait. We cannot afford the cost of tackling an ever increasing carbon problem in future years. And we certainly cannot afford the long-term implications of climate change like rising sea levels that will displace large centers of population, droughts that will dramatically reduce fresh drinking water, and major storms like those that have hit the Gulf Coast and Atlantic seaboard over the past few years.

Climate change is certainly the most pressing environmental issue facing us today. But we should not forget about other important issues facing our constituents. Reducing mercury and other air pollutants, reducing pollution of our rivers and streams, preserving open space and stopping urban sprawl, increasing investments in renewable and alternative energy sources, establishing higher fuel efficiency standards, and reducing the number of unremediated Superfund sites continue to be top priorities for me.

For this reason and in honor of Earth Day, today I am introducing the Superfund Equity and Megasite Remediation Act of 2007. This legislation reinstates the polluter-pays tax that funds clean up of Superfund sites. In addition, my bill ramps up the tax for limited 5-year period in order to create a fund to clean up megasites, which cost more than $50 million each to remediate.

I know that Senator Boxer, the Chairman of the Environment and Public Works Committee, has been a long-time advocate for reinstating the polluter-pays principle in federal hazardous waste cleanup law. I look forward to working with her and all of my colleagues on the Environment Committee and the Finance Committee to make sure that we have a Superfund program that cleans up the polluted sites that blight our communities and prevent development and reuse, and does so in a way that polluters foot the bill, and not taxpayers. I urge all of my colleagues to join me in support of this bill, and do the right thing for our local towns on Earth Day.

Mr. President, I rise today to introduce the Identity Theft

Prevention Act of 2007 with my colleagues Senator Stevens and Senator Pryor to protect Americans from identity theft.

The recent breaches of security that led to the loss of sensitive personal information remind all of us how vulnerable we are to thieves stealing our identity for criminal purposes. Identity theft is a growing threat to our personal security that must be met with new tactics and new laws in the information age.

We in the Congress and every consumer in America have seen the evolution of identity theft. The moment of greatest awareness was in February 2005 when ChoicePoint notified more than 145,000 people that their personal data had been accessed by unauthorized persons who used some of the information for identity theft. ChoicePoint was required to make these contacts under the California notification law, but this incident had nationwide effects. Since then, a number of data brokers, banks, universities and other entities that hold personal information have notified individuals that their personal information may have been compromised. The last major breach was made public in January 2007, when T.J. Maxx announced it had discovered a breach in the security of its customer payment data. As a result of hacker activity starting in 2005, information on more than 45 million credit and debit cards had been stolen.

The need to address this problem is long overdue. Every business that collects and stores sensitive personal information must ensure that the information is safeguarded. If a security breach occurs and the information could be used for identity theft, every affected consumer needs to be notified as soon as possible so they can best protect themselves and their families. The Identity Theft Prevention Act provides the Federal Trade Commission new enforcement tools to ensure businesses that hold a consumer's sensitive personal information use vigorous safeguards to prevent breaches from happening. The Act also requires businesses to appropriately notify consumers if their information is improperly released and could lead to identity theft. In addition, the Identity Theft Prevention Act provides consumers the ability to place a security freeze on their credit reports, so if they choose, they can eliminate the worry and the impact of an identity thief opening new lines of credit from stolen information.

Americans have demanded better protection for their sensitive personal information, and it is imperative that we respond to these demands effectively and expeditiously. I look forward to working with the other Members of the Senate to move this legislation forward.