Disabled Veterans Employment Protection Act

I enjoyed the comments of my good friend, Mr. Baca, from San Bernardino County. I have some correspondence from San Bernardino County that might interest him.

According to the county offices, there is no one at the county that would support current NSP programs, period. The letters of support did not come from San Bernardino County, which is one of the hardest hit in the Nation. In fact, the county might have supported the current NSP, but this is before they fell victim to complete lack of direction from HUD, mixed messages from HUD, and gross misallocation of awards that were released.

As it applies to my bill, the county says, ``We believe it is a means for Congress to get its financial house in order, just like the challenges we are facing at the local level.''

Mr. Baca made a very nice written speech, but his own county that he represents does not support the program. And I was disappointed that a group called Chicanos por la Causa was mentioned. Well, let me just talk about the numbers that I have a problem with.

This NSP allocation program was meant to be a one-time program. It ended up three times. Now, the allocations applied, the problems I had when you look at a county the size of Los Angeles County, they got $26.3 million; San Bernardino County, Mr. Baca's county, got $33.2 million; Orange County got $4.3 million; and San Diego County got $5.1 million.

Now, all of these counties had to apply Davis-Bacon rules and wage standards to rehab these houses, which meant it cost 25 percent more to do it than the private sector could have done it on a competitive bidding nature.

Now, my good friend Mr. Baca mentioned one group, as if I had something against Chicanos. The problem I have is that nongovernment agencies, such as Neighborhood Lending Partners, got $50 million--$50 million; the Community Builders, Inc. got $78.6 million; Los Angeles Neighborhood Housing Services, Inc. got $60 million; Neighborhood Lending Partners of West Florida, Incorporated got $50 million; Chicanos por la Causa got $137 million.

Understand, L.A. County got $26.3 million; San Bernardino County got $33.2 million; Orange County got $4.3 million; San Diego County got $4.5 million. The largest population base in California got less money than Chicanos por la Causa. Does that make anybody in America happy?

I yield to the gentleman from Massachusetts.

I reclaim my time.

If it had been Germans for Affordable Housing, I would have opposed it. If it had been Italians for Affordable Housing, I would have opposed it. Had it been Irish Germans for Affordable Housing at $137 million, I would have opposed it.

Understand, these are taxpayer dollars from people who lost their houses, people who are behind in their payments, people who are facing foreclosure, and none of this money does one thing to help you. It was not an equitable application based on who got money and how they got it. In fact, a lot of these private groups write off 17 percent off the top for overhead and costs--17 percent.

Now, we talked about banks. When we lent banks the money in TARP 1, they paid us interest. We paid money because we got our money back. Freddie and Fannie, the money we allocated to them, we are charging them 10 percent interest and they have to pay us back, and the American public is furious at that.

We just gave away $50 million to one private group, gave $78 million to another, $60 million to another, $50 million to another. And as my good friend Joe Baca says, Chicanos por la Causa, the poor group, got $137 million given to you. We are not charging you interest. We gave you the money.

Now, are we helping housing this country? No. Housing starts fell 22 percent in February, the lowest levels since 1959. It has done nothing for housing: 11.8 percent fall in single-family, 47 percent fall in multifamily. Tell me one thing this has done. It has not kept one person in their house.

Now, let's assume this is supposed to be helping poor people buy houses. You just lost your house. In Hawaii, a person making $73,825 can buy a house through these organizations. A person in California making over $68,000 can buy a house through these organizations. A group in Virginia, $74,000; New Jersey, $78,000; Massachusetts, $72,000; Utah, $75,000; Alaska, $76,000; Colorado, $73,000; New Hampshire, $79,000.

So a group, an entity, a State, a county, a city can buy a house. They have to sell it for less than they have in it, and they can sell it to people making more than the person who may have lost the house.

Now, how in the world does that do one thing for poor people? It does not do one thing for poor people.

Now let's talk about jobs. If we had invested $1 billion in the construction industry to build houses, you would have got $2.8 billion in economic activities.

If you would have invested $1 billion, you would have generated $2.8 billion in economic activities: $5.5 million in wages, $138 million in income for small businesses, $156 million in corporate profits, $1.98 billion in spending on goods and services from the above three line items. It is huge. So if we are talking about jobs, let's create jobs.

Now, they say we have had no alternative to what they did. In 2008, I endorsed a bill and introduced it called the Public-Private Partnership Community Stabilization Act. It took government dollars and invested them with private groups to do the same thing, to buy houses that were foreclosed upon and rehab them in communities. And when the houses were sold, guess what? The money would have been paid back to the Federal Government. We would have probably made a profit. We wouldn't have given a dime away. We would have made money on doing the same thing.

Now, the other side talks about abandoned houses. Not a dime of this money can be used for eminent domain, so either the house is for sale or it can't be bought. It can't be foreclosed upon by the government through eminent domain. So to say that some private group could not have bought this house and rehabbed it themselves is ludicrous, because the house has to be for sale.

Now, this group can go out and buy the house, demolish it and end up with a vacant lot. They can go out and buy a house, rehab it and sell it for a dollar, 10, any amount they want to sell it for, to anybody they want to sell it to, as long as it is less than they have in it.

I had a bill passed out of this House that Mr. Frank cosponsored--he thought it was a good bill--that allowed banks to take foreclosed properties and lease them for 5 years. If you want to get rid of foreclosed properties, allow banks to take the property, rehab it, put it on the marketplace, or lease it out for 5 years. It would have done the same thing, and perhaps banks would not have driven the marketplace down on resales because they were glutted with foreclosures.

We could have taken these houses, leased them, and in 5 years when the market turned around, they could have sold them. And guess what. They could have given a lease option to the person losing the house to stay in the house for 5 years and buy it back at the end of 5 years. It would have at least helped foreclosure projects.

I seem to have hit a nerve with my good friends on the other side of the aisle when I said Chicanos Por la Causa. It is not who it went to if it is not a government agency, if it was Germans for Affordable Housing. It is $137 million that I object to going to a group that is a non-government entity that has the money that we will not get back.

And we keep talking about letters of support. Now, if you are a city, a county, or if you are one of these nonprofit groups that received the money, you would be an absolute hypocrite to take the money and then not send a letter saying, thank you for the money. I think the money was well spent because you gave it to me to spend. Nobody would take money that they didn't want to take.

Mr. Chair, I appreciate my good friend admitting that we're giving the money away, because we are. I struck a nerve for some reason when everybody keeps bringing up Chicanos Por La Causa for $137 million. The reason I think it's egregious is we gave $1.3 billion away to nongovernment entities. And this one entity got 10 percent of all the nongovernment funding that went out. Nobody has mentioned that I mentioned other groups that got $50 million, $70 million, $60 million, $50 million each. I mentioned those groups. But what did HUD say about the money? When I quizzed Mercedes Marquez of HUD, her quote was ``The money is going to homeowners and to American citizens.''

The problem I have with this, how do you feel about the people who lost the home? You've got a family, they put money into the home. The last couple of years have been tough. They couldn't repair the plumbing, they couldn't replace the appliances, they couldn't afford to replace the broken window, they couldn't paint the house because their house was in foreclosure. They lost that house. Now, we're spending $7 billion, and we have not helped one person in this country remain a homeowner.

If your house is going into foreclosure, you're going to lose it. And these dollars are going to be spent to rehab your house and sell it to somebody else.

Wake up, America.

Well, my good friend Mr. Frank knows you can go to any land title company and they'll tell you who owns the property: either the person lost it to a bank that had a loan on it or the bank owns it now; and if they didn't have a loan on it, they still own the property. And if the property's been abandoned, under rules of public safety, the city can go and demolish a property for public safety measures.

But the difference is--I'm glad that Mr. Frank said he disagrees with the Obama administration because I think they're wrong, too, but in this case I think you're wrong.

This proposal does not make any sense. We believe we're on the side of the people who are paying taxes in this country. Many are going through foreclosure. Many are out of work. We've taken your tax dollars and we've decided to give it to somebody else to buy property from the very banks that they take and say are so awful.

Now, there's been a lot of predatory loans made in this country. Lenders should not have made loans to people. They took advantage of people, no doubt. But then they foreclosed on those very people and we give private groups and government entities the ability to go buy the property from those banks, take and refurbish it, and sell it to people.

Now I will state again, in California, you can earn over $68,000 and buy one of these homes. You can earn between $73,000 and $80,000 and live in Hawaii, Virginia, New Jersey, Massachusetts, Utah, Alaska, Colorado, New Hampshire, and qualify to pick up a very good deal. Sometimes it might be based on who you know that has the house currently. Are you affiliated with somebody at the city at a good level or the county? Or do you know one of these people at the nongovernment agencies on the board of directors, and you say, Hey, my cousin would like to buy one of these houses. And by the way, he'd like a good deal. There is nothing in the bill that precludes that. The bill says clearly that you have to sell it for less than you paid and reinvested in it. It does not say how much less you have to sell it for or how much you sell it for.

My good friend Mr. Frank brought up a good point. He said, Well, show me where any of these egregious things and illegal things have occurred where somebody has cut somebody a deal. Well, I can't show you any because there are no requirements. You could take one of these nonprofit, nongovernment entities out here that bought a house. They have $180,000 in the house. One of the board members' cousins could buy that house for $100,000, and it does not violate the requirements within the bill because it says you have to sell that house for less than the acquisition and rehabilitation prices. It does not say how much less. It says that you must not exceed an amount.

So my good friend is absolutely correct. I cannot show you an egregious act because there is no egregious act defined within the legislation. And that's the problem with the bill. I believe we are trying to say that the Republicans are on the side of the taxpayers. We believe that we need to do everything we can in this country to create jobs. And if we leave $7 billion in the economy based on the basic money multiplier of 10 percent, it creates $70 billion worth of economy and generation. We believe in that. We do believe in fair rules. And we believe that if a person has to watch their home go into foreclosure, and they live in California, and they watch a county, a city, or a nonprofit group buy that home, that they can sell that home to someone for $68,000 and all that person can do that lost their home is wipe the tears away.

Mr. Chair, I rise to claim time in opposition.

I'm not opposed to this amendment. This amendment only deals with stage three of a project that should have only been one phase. Now, I wish they would have talked about phase two because I wish you would study where the money went on phase two. Because in phase two alone, we give away $1.3 billion to nongovernment entities, incorporated businesses that are nonprofit.

But you have to say we did not stop a foreclosure. We just gave away in NSP2 $1.3 billion. Of that, Neighborhood Lending Partners received $50 million. They do not have to pay it back. Now, they can take that $50 million--I'm sure they're a very reputable company. I'm not accusing anybody of anything. But they can sell those houses for any amount to whomever they want as long as it's below the price they have invested in business.

Community Builders, Inc., $78.6 million; Los Angeles Neighborhood Housing, Services, Inc., $60 million; Neighborhood Lending Partners of West Florida, Inc., $50 million; Chicanos Por la Causa, Inc., $137 million.

I wish we would have taken the time to review those and say how was the money spent, but HUD did some work for us. So let's see what HUD did.

HUG and OIG audited the State of Kansas Neighborhood Stabilization Program, NSP1, and found that the State improperly obligated more than $12 million of its NSP1 funds. HUD and OIG audited the Sacramento Housing Redevelopment Agency of Sacramento, California, and found the agency did not administer its NSP funds in accordance with HUD rules and regulations. Specifically, it allowed ineligible properties to be rehabilitated; did not adequately monitor projects, which resulted in ineligible costs; permitted the developer to make unnecessary upgrades and overinflated construction budgets; did not ensure that it met the reporting requirements; and lacked management controls. I wish we would have audited this one in this amendment, too.

HUD and OIG audited the city and county of Denver, Colorado, NSP1, and found that the city improperly obligated more than $1.5 of its NSP funds by recording its funds as obligated. HUD and OIG reviewed the city of Chattanooga, Tennessee, and found that the city generally administered its program, however sometimes inconsistent with identifying obligations and was not always accurate on reporting to HUD. On Louisville, Kentucky, again, very similar to the previous.

Augusta, Georgia. Did not have internal controls in place to perform continuous and routine monitoring of its obligation process to ensure its obligations were processed as intended. HUD and OIG reviewed Clark County, Nevada NSP and found that Clark County needs to revise its written procedures and developer agreements to ensure that properties to be sold to eligible home buyers will be sold at a price permitted by NSP requirements, which means they probably were selling it at too much money.

So although I do support the amendment at hand, I wish it would have reviewed phase one and two.

I reserve the balance of my time.

Mr. Chair, I yield myself such time as I may consume.

I disagree. It's not time to amend and pretend. It's time to end.

The problem with this program is I highlighted you a few violations, but it's really hard to violate the program requirements because there are so few requirements. It says, We're going to give you money. You can buy property, you can demolish houses. You can buy property, you can rehabilitate those properties. You have vast guidelines on how you rehabilitate them. In fact, an organization is not even required to have competitive bids. I can say I need some framing done, I can lend a sole source contract. Only one person applied--that's the person I asked to apply--and I can pay them the moneys I deem appropriate.

It says you have to sell the house for less than you have in it. It doesn't say you should attempt to try to sell at fair market value, although I have given you a list previously of how much you can make, which is quite a bit of money, and buy these houses. It just says you cannot sell them for more. It does not restrict them on who you sell them to; it does not restrict on whose affiliation you have that might be buying them. In fact, it's almost impossible to have a conflict of interest because there's conflict designed within the bill.

So we can say let's amend and pretend, but let's just end.

I yield back the balance of my time.

Thank you for yielding.

I totally support the gentleman from Virginia's amendment. This is doing the right thing. It is saying, we're going to take a billion dollars back of your money, the taxpayers, and we're going to pay off the deficit that we've created for you.

It's about time we start paying down the debt. We cannot continue to spend dollars we don't have. Forty percent of every dollar we spend today is financed through the Treasury because we don't have the money. We're spending deficit dollars and it has to stop.

But I want to return to the argument that my good friend makes. And I respect my good friend. He knows that.

Somebody owned a home sometime, someplace, somewhere. Now, the individual who owned it, because it wasn't created by a miracle. Somebody built the house, somebody sold it to somebody, the individual might have gotten a loan on it from the bank. If the individual defaulted on the loan, the bank might have taken the house back. But the Federal Government and the local agencies look at taxes. We look at income taxes. The local governments, the city, the county, looks at property taxes. Somebody, some institution, is listed on the property tax bill.

Now, at some point in time, they're going to continue to notice the owner, whoever it might be. If it's an heir, you're going to get a notice, and it's going to say you did not pay your property taxes. At some point in time, that piece of property, home, vacated, abandoned, whatever it may be, is going up for a sale for property taxes.

I reclaim the balance of my time.

If it's a public safety issue, a local government has a right to demolish property based on public safety. That assessment could be placed against the tax bill. At some point in time, the local government, if they so choose, if nobody wants to pay a dollar for that property, can buy it based on the tax basis for a dollar. The problem with that is, once the government entity buys the property, it's taken off the tax rolls.

Some of my colleagues have talked about police and fire and the benefit to them. The worst thing you can do is eliminate funding through taxation to police and fire.

I would be happy to.

I reclaim the balance of my time.

If you go to any title company, it will list who the owner of record is. Regardless, if you can find that entity or individual, it will list it. Regardless of who it is, at some point in time, it goes to a tax sale.

At that point in time, the local government or an investor can buy it at a much reduced price for just the tax lien against it, and if it's abandoned and demolished and not worth anything, the tax bill is going to be very low. So somebody can pick up a very good deal on a piece of property by waiting for a tax sale. But if they choose not to and they want to go out and just buy it as a city or a county, they can do that and get a very good deal on it. So to assume that because nobody can find an owner out there, somebody is listed, and the government has a right to foreclose based on taxes.

I ask for an ``aye'' vote on the amendment.

I rise in opposition to the amendment.

If you want to talk about attractive nuisances, let's talk about next April when people have to pay their taxes. You're going to find out that government has become an incredible attractive nuisance to most people.

We're talking about middle class is shrinking, yeah, we're taxing them to death, and we're not only taxing them to death, but we're spending money on programs like this that is not an investment but is just a giveaway of tax dollars. Now we say we can't find the data to support that we bought 100,000 properties, but let's say we bought 100,000 properties. Somebody has the money, the $6 billion going on $7 billion, that we've given them. That's about 20,000 homes per State. Now you break that down to high-impact counties, compared to the millions of homes out there that are in foreclosure, these 100,000 homes have already been abandoned or foreclosed. I will say abandoned because the other side of the aisle wants to talk about abandoned homes, but they're homes that somebody does not live in anymore, and the people who lost them, yes, they lost them.

And how many jobs were created? Nobody can definitively give me a number because nobody knows for sure how much money was spent on jobs. Now, we can say we spent $6 billion, but understand clearly, we bought properties with the bulk of that money. Now, how much money did we spend after the local groups, the nonprofits took 17 percent off the top for overhead and expenses, how much did we spend for jobs? Now, if we had taken that $6 billion, going on $7 billion, and invested it in residential construction, just $1 billion, as I said, in residential construction creates $5.5 million in wages. It creates $1.98 billion in spending on goods and services as a result of the new earnings and profits that were created through that.

Now, those goods and services, those companies employ workers. The wages are paid to workers. So you can definitively come up with a number based on a $1 billion investment that we would generate in the economy. Now, we spent $6 billion, and if we were able to create what $1 billion would have created in private residential construction, we're probably lucky, but the problem with that is investing in residential construction is different than giving $6 billion away of the taxpayers' money.

Now, the people listening to this debate understand, when you write your check to the Federal Government next month, we just gave away $6 billion of it, we're going to give away another billion. Now, that infuriates me. I would assume it infuriates you. You tell me, middle class America, what this does to help you? I told you the amounts earlier of how much you can earn to buy a house or how little you might have to pay for the house, depending on whoever bought the house what they want to charge and who they want to sell it to.

So the basis I would argue here is the amendment does nothing. I oppose it.

I reserve the balance of my time.

I yield myself the balance of my time.

The facts speak for themselves. When you can say $1.3 billion was given away to nongovernmental agencies--and I have listed the groups, and I have told you how many millions of your dollars were given to these groups that they get to keep--they are not coming back to us right now. These people are going to keep these moneys, and there is a wide array of things they can use them for. This was a bad investment. In fact, it was not an investment. It was a bad giveaway.

I yield back the balance of my time.

Mr. Chair, I rise in opposition to the amendment.

I yield myself such time as I may consume.

My good friend, she mentioned the Neighborhood Housing Services of Orange County. They got $7.5 million for 17 houses. Orange County, overall in the whole county, got $4.3 million for the whole county. You have to say, is that a good investment? We have spent $6 billion on this program, and we're saying, let's not spend the last billion. And Congress could have rebuilt neighborhoods. There is only $1 billion left.

Now I don't see that the U.S. neighborhoods have been rebuilt for $6 billion. I see $6 billion that has been given away of taxpayers' moneys. And Orange County itself, which is a huge area, irrespective of the few examples that were given by my good friend, only got $4.3 million. That's not equitable.

San Bernardino County, one of the hardest hit counties in this country, got a mere $33.2 million. One of the hardest hit. That's the county. That had to go to all these cities that did not receive any distribution in NSP1 or NSP2, nothing. And they're having to take--and in Orange County, with $4.3 million--take that and distribute it to all these cities that did not receive a dime. That's not fair.

And to say that we spent $6 billion--and all the counties and cities haven't been rehabilitated, it's obvious--and to say we're going to spend $1 billion more, and that's going to solve the problem? No, it's not. It's just going to take it and put us another $1 billion in debt that our children and our grandchildren are going to have to pay for.

I reserve the balance of my time.

I yield myself such time as I may consume.

The problem I have with the program--I have just mentioned San Bernardino County; and according to the county, there is no one at the county level that would support the current NSP program. And they state very specifically the county might have supported the concept of NSP, but this is before they fell victim to a complete lack of direction from HUD, mixed messages from HUD, and gross misallocations of the awards that were released. And the county, in support of my bill, said, We believe it is a means for Congress to get its financial house in order, just like the challenges we are facing at the local government level.

And not only is government facing challenges, the American people are facing challenges. They're working hard. They're trying to support their families. They're trying to make their house payments. Nothing in this last billion dollars will stop one foreclosure from occurring.

I yield the balance of my time to the gentleman from Arizona (Mr. Schweikert).

Madam Chair, I rise in opposition to the amendment.

I yield myself such time as I may consume.

I guess the question should be how long do we need to wait? How many more billions of dollars needs to be given away? We've already spent $6 billion. I guess we could spend more if somebody wanted to.

And when we talk about phasing out a program, it speaks to the argument that we need to spend more money on a program and continue the program. I think we've already spent too much money.

I yield to the gentlewoman from California.

I reclaim my time. On this issue, how long we wait is predicated on how much we are going to spend. And my colleagues on this side of the aisle believe the American people, the taxpayers have given too much of their money away, and they are saying we want it stopped, and we want you to be responsible for this money.

If this were our dollars, and we're getting in her purse and my wallet and handing the money out, that's a prerogative we have. That's not what's occurring, other than we are taxpayers too.

We've just got our hands in your pocket and your purse and spent your money on a giveaway program.

I ask for a ``no'' vote.

I yield back the balance of my time.

Madam Chair, I ask unanimous consent to reclaim my time.

I am happy to yield such time as he may consume to the gentleman from Arizona (Mr. Schweikert).

I yield myself such time as I may consume.

The other point that is significant and that needs to be dealt with here is the $6 billion that has already been given away. That money continues to recycle with those groups. It should. As to the cities, the counties, the nonprofits, when they buy a house, refurbish it and sell it and when the money comes back at whatever level, they could take that money and buy another piece of property.

Nothing in my bill does anything with the $6 billion that's out there. It just says: We're not going to give you another $1 billion. We're going to try to give that back to the taxpayers.

If we could get the $6 billion back and could find a way to do it, I believe we'd be trying to attack that vein, too, but that will not occur and cannot occur as the money has already been given away. They're going to continue to recycle it, hopefully to some benefit-- hopefully somebody will benefit from this--but it's $6 billion given away. My colleague was exactly correct in his statements. As for the $1 billion that we have not given away, we're saying it is time to stop giving away taxpayer dollars.

I reserve the balance of my time.

I yield back the balance of my time.

Madam Chair, the Congresswoman's amendment does nothing to help at-risk borrowers, and the notification the Congresswoman proposes would apply only to community groups, leaders and speculators currently participating in the program. It is not a serious attempt to address the underlying problem homeowners are facing today.

If we are going to have a notification requirement, it makes more sense to have the recipients of these funds to date notify taxpayers how much, in what way they have spent taxpayer dollars and what return taxpayers can expect from their investments.

Unfortunately, the answer is: none. Many have questioned HUD's ability to properly monitor the use of such extraordinary amounts of money being spent at the State level and in various ways. The Inspector General of HUD has already identified multiple misuses of NSP money at the State level. The GAO has questioned the information system in place at HUD, and has questioned its ability to track the NSP funds.

I wish the amendment had said: Please continue using the $6 billion in an appropriate way, and in some way, do everything you can to create jobs for the American workers with the $6 billion we've given you.

It does not say that, and I cannot support the amendment the way it is drafted.

I reserve the balance of my time.

I yield myself such time as I may consume.

Well, I did not introduce an amendment because I introduced the bill. I think that bill speaks for itself.

But I am glad that my good friend admitted that this was not meant to mitigate the foreclosure process for people going through. I am glad you admitted that, because that is not what your amendment says. It says that: such entities should contact such Members of Congress directly for assistance in mitigating foreclosed properties. You can't mitigate a foreclosure when you don't help anybody with the foreclosure.

I yield 1 minute to the gentleman from Arizona (Mr. Schweikert).

I yield myself the balance of my time.

As much as I respect my good friend--and she knows--we have worked together on a lot of issues, and I don't believe anything between us has ever been personal in all the years we have known each other. And nothing in this debate is personal. We both are well intended. We both really want to help the American people. And I say that from the heart, and you know that. And I know your efforts are for the right purposes. But good people can disagree in a good way. And on this amendment, I have to respectfully disagree, and I would ask for a ``no'' vote.

I yield back the balance of my time.

I yield myself such time as I may consume.

My friend has said that we need to determine the approximate number of foreclosed and abandoned properties that will be purchased or rehabilitated because of termination of NSP. That is impossible. We have no idea how many times the money will be recycled, because the $6 billion that is out there could be recycled over and over and over. We don't know. We don't know how much money is going to be given away to somebody who bought the house, how much is going to be taken back in the sale. So that is an unknown quantity.

But my good friend did say that 72,000 units were impacted by NSP 1. So, America, for $6 billion you impacted 72,000 units. How do you feel about that? Now, I am not sure what we did to impact them, but we impacted them. We sure spent a lot of your money impacting them.

Now, at the same time, we are asking HUD to do a study. That is like the fox guarding the hen house. I am really sorry. Because when I asked Mercedes Marquez of HUD at our committee hearing to discuss where the money went, she finally said, The money is going to homeowners and to American citizens. And they strongly support the program and they are strongly encouraging the President to veto this bill, should it get to him.

So let's just have the very organization do a study on a program that they said they support and love and, if we are successful in getting the bill passed, would encourage the administration to veto it.

That is the biggest conflict of interest I have ever had presented to me to vote on, but it is an easy conflict of interest that I say is a conflict of interest. I would strongly encourage my colleagues to vote ``no.''

I yield back the balance of my time.

I yield myself such time as I may consume.

Well, I know my good friend Mrs. Maloney has the best of intentions in putting this amendment forward, but you are talking about the number of homes in each State that have been vacant 90 days or more and could ultimately receive funding under the NSP.

Well, the homes are not eligible to receive funding. Entities are eligible to receive funding. Then those entities, whether they be government or private sector, can go buy those homes. The problem is they can buy any home they want to. The only restriction on the program is that you can only earn up to 120 percent of the median income in an area to qualify to buy the house, but it does not restrict the price of the home being bought by the agency or the nonprofit. They can buy virtually any home they want to, and that is one of the flaws in the bill.

For example, if you have any home that has been vacant 90 days or more, well, I have a partner of mine and myself, we had four homes for sale in the last year that were on the market more than 90 days. The houses were in perfect condition, but yet they remained on the market for over 90 days. So based on this encouragement, one of these groups, whether it be a city, a county, a private entity that is not affiliated with government, could have bought those houses and resold the houses for far less than they paid for them. That is the flaw with this program here.

We are saying that what this wants us to do here is congressional findings to the bill listing all 50 States and the District of Columbia in separate subparagraphs and the number of homes in each State that have been vacant 90 days or more and could be eligible to receive funding in NSP.

What you mean is any home vacant for over 90 days would have to be listed, because there is not a dollar amount in the bill saying how much you can pay for a house. There is only a dollar amount saying how much a person can earn to buy the house.

For example, if you live in Hawaii, you can make up to $73,825.20 a year and qualify to buy a home. In California, you can earn $68,416.80 a year and qualify to buy a home. It might be an $800,000 home, but you can still qualify, if they sell it to you cheap enough. In Virginia, you could earn $74,382 and buy a home; in New Jersey, $78,367; in Massachusetts, $72,384; in

Utah, $75,044; in Alaska, $76,786; in Colorado, $73,131; and in New Hampshire, $79,411.

So the concept of this program is just helping people at the lower rungs who are really struggling. I am not saying people aren't struggling in these income brackets. That is not what I mean. But I don't want the American people to have the perception we are just trying to pick up deals and sell them to the lowest of income levels.

Reclaiming my time, I was in the building industry from my early twenties, and the most excitement you could ever see on a person's face was when they bought a home and they were moving into that home and they thought about raising their family.

I would love a country that every person in this country has the ability and the opportunity at some point in their life to buy a home. But, in some fashion, lenders have put people in positions to put them in homes that they could not afford, and those homes, in many cases the individuals lost those homes through foreclosures. And those people, who were well-intentioned, moved into homes that they could not afford because the lender perhaps did not describe it exactly or they thought the way the economy is going, in 3 or 4 or 5 years the house is going to be worth 40 percent more than I paid and I am going to make a lot of money. The problem is the market went the other way, as it did in 1974- 1975, 1981-1983, 1990-1996, and recently in 2007 to current the market slid.

And then we're saying we're going to go out and we're going to ask to do a survey and we're going to list any home throughout the United States in separate paragraphs that have been vacant for 90 days or more that could be eligible. Well, all of them would be eligible.

I yield to the gentleman.

Reclaiming my time, Mr. Frank, what specifically has been said throughout this debate, as if we're trying to help people at the lower rungs, which I have no problem with, but I'm saying that there was not a restriction on the amount that could be paid for the house and there was not a requirement of how much it should be sold for.

I ask for a ``no'' vote.

I yield back the balance of my time.

Madam Chair, I rise to claim the time in opposition.

Some of the arguments that the gentlelady made are heart-wrenching. You hate to think about homeless people. Veterans are suffering in this country, there's no doubt about it. Veterans are coming back. Some of them have problems from being on the front in combat. In our church every week, our pastor talks about that, and we pray for these veterans. You feel sorry for them.

But we talk about elderly; we talk about veterans; we talk about children; we talk about homeless. Nothing in this bill prioritizes them in any fashion. There are groups that could be helped as a consequence of it, and I understand that, but nothing prioritizes.

I'm going to accept the gentlelady's amendment because I have no problem with trying to determine the economic impact of the Neighborhood Stabilization Program. I think there's been a huge impact on the economy because we've given away, to date, $6 billion of taxpayers' money on this program. And I think we could have done a much better job at investing that money in another fashion that wouldn't have put the taxpayers at risk and perhaps created jobs in doing that.

But I met with the NAHB, National Association of Home Builders, to talk about all the people in the industry out of work. I've talked to BIA, talking about all the Building Industry Association members out of work, and they're trying to put them to work. This bill does not help them.

We talk about a giveaway to banks. In TARP 1, we lent money to banks, yes, and they paid it back with interest. Freddie and Fannie, yes, we're lending money to Freddie and Fannie. They're paying 10 percent interest on the money. So to create this straw man out there of the bank giveaway and Wall Street and Freddie and Fannie is fallacious. Freddie and Fannie are paying 10 percent interest on the money.

We did not just, the people who voted for the first half of TARP, vote to give

banks money and forget it, go home. It was to stop a major run on the banks and to stop this economy from plummeting. And Bernanke and Paulson and the administration, everybody on both sides of the aisle agreed it had to be done. And the money was paid back, and we made money on it. Shock.

This money was given away and we will not be getting it back.

I yield 1\1/2\ minutes to the gentleman from Arizona (Mr. Schweikert).

I would be happy to yield to the gentlelady. I was not meaning to be rude or forget about you.

Madam Chair, I reclaim my time.

I was going to allow for adequate time on that, but it was not a giveaway. It was a loan. You're comparing $350 billion in the first half that was lent to lenders to stabilize the economy versus $700 billion that was a giveaway.

It's my time, Madam Chair.

Regular order, Madam Chair.

I think we're comparing things that have nothing to do with the bill before us. So we can talk about Wall Street. We can talk about banks. If anything, this has helped banks because it's taken foreclosed properties that they've had and it's bought them. So we can add all these straw men to the debate that we want to. The thing is, should we give away taxpayer dollars? I say no and I ask for an ``aye'' on the gentlelady's amendment.

Mr. Speaker, I reserve a point of order against the amendment.

Mr. Speaker, I rise in opposition to the amendment.

I withdraw my point of order.

That was a very nice picture of a storefront. It was not a picture of a home. Now, why would you impose a terrible program on rural America that you don't want on urban America?

You have to say we have given away $6 billion of taxpayer monies and it will never come back to the Federal Government. We are saying let's preserve the last billion dollars.

There is a huge lack of accountability in this program. The inspector general of HUD has already identified multiple misuses of NSP money at the State level. The GAO has questioned the information system that places HUD at risk using the tracking system.

How many of you want to use your money to buy this house that Chairman Bachus has pointed out? Nobody. But, taxpayers, guess what? We are using your money. The biggest problem with this program is unfair allocation.

Now, rural America, you probably got ripped off in this whole process like everybody else did because, let's see, where did the money go? In the NSP 1, we spent $4 billion. In the NSP 2, $1.93 billion. We are saying the last billion dollars, let's at least save that for the taxpayers and use it for some beneficial purpose.

Where did the money go? Let's see if it was fairly distributed. Let's look at my area. L.A. County got $26.3 million. San Bernardino County, one of the hardest hit, got $33.2 million. Orange County got $4.3 million. San Diego County, $5.1 million. A total of $68.9 million on hard-hit counties.

Now, let's see. What did nongovernment agency groups get out there that are incorporated? Neighborhood Lending Partners, Incorporated got $50 million; the Community Builders, Incorporated got $78.6 million; Los Angeles Neighborhood Housing Service, Incorporated got $60 million; Neighborhood Lending Partners of West Florida, Incorporated got $50 million; and Chicanos por la Causa, Inc. got $137 million.

Now, all of my counties got $68.9 million; the Community Builders got $78.6 million; Chicanos por la Causa got $137 million. Is that considered nonequitable qualification? It is nonequitable, period. It does not make sense. And we say $1.3 billion went to nongovernment agencies.

Now, somebody said I was racist because I said Chicanos por la Causa got $137 million. They got 10 percent of all the funds given to nongovernment agencies. If it was Germans for Affordable Housing that got $137 million, I would oppose it just like I oppose this one.

Now, taxpayers understand, clearly, it did not prevent one foreclosure in this entire country. Not one person got to keep their home because we spent $6 billion. In fact, imagine the family who owned the home. Maybe the ma or pa got in trouble with their job. They couldn't quite make the payments. For the last 3 years, they have been unable to repair the plumbing. They couldn't replace the oven that wasn't working. A couple windows were broken out.

The house needed painting. And they had to sit there and let their house go back to the lender, to watch some entity, a nonprofit or government agency, buy that home, fix it up, and sell it to somebody else. How would you feel when nobody came to your aid when you were losing your home, but yet your tax dollars were used to buy that home to give it to somebody else?

Now, understand clearly, the argument they have made is look at all the money we gave to bail out the banks. Well, I got an update from Treasury today. Ninety-nine percent of the money that we lent to banks has been paid back. And, guess what? We made $20 billion on it. But we gave $7 billion away to this program. So, yes, we made 20, and we ended up with a net 13, by lending the money that you say bailed out the banks. It was a loan.

This program does nothing but say we are going to send you a check, and you never send us a dime back. And the sweet part is you can pay any amount of money you want for the house. It is almost impossible to violate the terms of this deal, because there are no conditions. You can pay $800,000 for a house and sell it for $50. The requirement is whatever you pay for the house, plus whatever you pay to rehabilitate the house, you have to sell it for less.

And it doesn't say who you have to sell it to. A nonprofit, I am not saying they would, could have a cousin who wanted to buy the house that they paid $180,000 for and they could sell it legitimately for $20,000, and, guess what? You have not violated the terms of NSP 1, 2 or 3, and you have not broken the law. And when you sell the house, if you sell it, you can take the money and recycle it again. You could even take this money and do a private venture with a private group, splitting profits, and, falling under the conditions of how you buy the house and sell the house, money gets split. There are very few restrictions in this bill.

This is a terrible bill. I would encourage a ``no'' vote on the motion to recommit.

Mr. Chairman, I yield 3 minutes to a member of the committee, the gentleman from Massachusetts (Mr. Lynch).

Mr. Chairman, I yield myself 30 seconds to say that the gentleman has just explained why this is bad for the cities.

Every organization representing cities and counties and local governments and local economic development agencies disagree with him. They have written to us and asked us to support this program because he is simply wrong about the tax implications.

Will the gentleman yield?

Does the gentleman not want to mention that Chicanos por la Causa----

I yield myself the 30 seconds the gentleman wouldn't allow me to mention--Chicanos Por la Causa, which he keeps invoking, in what I must say is an inflammatory way, yes, it has $137 million in eight States. It is a consortium of several groups. Comparing it to one county is quite misleading. It is $137 million to an organization that has eight States in which it works and which has produced affordable housing units. And as to his argument that it is not for the poor people, almost all of the groups in this country that advocate for housing for low-income groups have sent us a letter urging that this go forward, Habitat for Humanity and others. I take them as more credible on this than my friend.

I yield 1 minute to the gentleman from Indiana (Mr. Carson).

I yield myself 15 seconds.

The gentleman from California says he is not singling out Chicanos Por la Causa, that there are other private organizations, but he never mentions them. And he says, well, they are not a government entity. That is right. We don't think it all has to go through the government. We think places like Habitat for Humanity and others have a role to play.

I yield 3 minutes to the former mayor of the city of Somerville, Massachusetts (Mr. Capuano).

I yield myself 2 minutes to say I am struck by the incongruity of Members who have voted for the war in Iraq, a trillion-dollar huge mistake, ongoing, who vote to continue what seems to me a futile effort now in Afghanistan.

The gentleman from Alabama, and we've talked about this before, he said that because the Obama administration told him he had to, he voted to send $150 million a year last year, next year, for the next 2 years to the cotton farmers of Brazil. The gentleman opposed a $250,000 limit on subsidies to any individual farmer. In the budget, the gentleman voted, as did most on his side, to send $1.2 billion to beef up Iraqi security forces. What about American security forces? What about giving some money to the cities so when they have to deal with abandoned property, they don't have to take that out of the hides of their police departments and fire departments?

Yes, we should reduce the deficit. But to be for the enormous waste in the Pentagon--and, by the way, Members cite Mike Mullen. I wish, in addition to citing the Chairman of the Joint Chiefs of Staff, they would make a simple commitment not to vote for the Pentagon money he doesn't want. Because Members on that side cite his warning about the defense budget, about the deficit, and then force money on him that he thinks is useless.

So let's talk about the disparity between people who vote enormous amounts of money; $400 million goes to Afghan infrastructure, we're told. Well, let's have it be done efficiently. I cannot think that in any program in America we are going to be spending the money less efficiently than the $400 million my friends over there have voted to send to Afghanistan.

So let's look at this in a reasonable way. And we also believe that this billion dollars, in fact, helps our cities. And there's one fundamental error they make: the assumption is that for every piece of property--by the way, it is not simply foreclosed property; it is abandoned property--for every piece of property that's out there, there is a responsible financial institution whom you can sue and get the money from. That simply isn't true.

I yield myself 30 more seconds.

For many of these pieces of property, the cities are left with no recourse. There is no one to do it. One of the Members said the other day in committee, Well, they can send out their bulldozer. Yeah, they can pull a firefighter off and hire a bulldozer operator.

The fact is that it is not simply for foreclosed property. It's for foreclosed and abandoned property, and the notion that there are no buildings out there in the cities where there is no responsible financial entity is nonsense. And so what we're telling the cities is, It's tough. You've had these foreclosure problems. You've had this abandonment problem. You could sell it to the private sector, and the private sector will buy some, but they won't buy it all.

I now yield 3 minutes to the gentlewoman from California (Ms. Waters).

I yield the gentlewoman 1 additional minute.

No, I don't think any private entity would--I'm sorry. May I answer the question?

That's why we want to give money to the cities so they can tear it down, because otherwise they'll be stuck with it. I don't think any private investor would put money in that. There's no other way to deal with it, and the way to deal with it is to give them the money so they can tear it down.

I yield myself 3 minutes.

First of all, the gentleman says why are you talking about other programs, why don't you just talk about this program, but he talks about hundreds of billions of dollars of deficit, and this is a billion dollar program. So he hardly, Mr. Chairman, follows his own rules. He talks about hundreds of billions of dollars about a billion dollar program. I am joining him in saying, yes, we have a large deficit, of which this program is an infinitesimal part.

Secondly, I am puzzled that my Republican friends, who generally tell us that the President is not very good at his job, hide behind him when it's politically convenient. Yes, this is an Obama deal. The President was wrong. And unlike the gentleman from Alabama, if I think the President has made a foolish decision, I'm going to vote against it, not to send the money to Brazil. It wasn't the President who told you to vote not to limit the subsidies to $250,000 per person.

And as to bringing people home from Afghanistan, we will have a chance tomorrow to bring people home from Afghanistan. I will vote for that. Sending $400 million for corrupt infrastructure expenditures isn't bringing anybody home. So let's bring them home. The gentleman will have a chance to do that tomorrow.

But then I want to go back to his thing about do you want to invest? No. He just ignored the facts. This is not just about foreclosed properties. It's about abandoned properties. He says do I want to invest? He said do I want to buy it? Does he know who owns that? Could he give me the address? And what the gentleman said, he said of course you can find out who owns it; it's not hard.

We believe that there are properties where you can't find the owner. Now, the gentleman got the picture. He must know about the property.

Would you give us the address and the name of the responsible owner so we can tell the city not to use public money?

I yield to the gentleman from Alabama.

No. I will yield for the purpose of asking the gentleman a question.

He said it's possible to find the address and the owner. I am asking him to live up to what he said. Can he tell us who the owner is? He's got the picture of the property. He says, no, you don't have to spend public money to tear it down. Go after the responsible owner.

I ask the gentleman, can he tell us who is the responsible owner?

I yield to the gentleman.

The gentleman is wrong.

I reclaim my time.

Please instruct the gentleman as to the rules. He is blatantly wrong. It is not simply purchasing property. This gives the city money, and maybe that's why they are so wrong on this. They don't understand the program. It includes giving the city money to go in----

I yield myself another minute, because these people take a lot of work to get them to explain it.

The fact is that it isn't simply to buy it from a responsible owner. It includes money, as we have tried to explain to them, to demolish property. In fact, in the cities of Detroit and Cleveland, they specifically asked us--the gentlewoman from Los Angeles amended it--you can use city money to demolish property when there is no owner. So, no, there is no--you don't write a check to someone who has abandoned the property.

I yield to the gentleman.

I reclaim my time to point out the evasion.

I yield myself another 30 seconds.

The gentleman made a big point of saying, buy the property from this person. He doesn't know who owns the property. No one knows who owns the property because no one owns the property. They walked away from it.

And what we're saying is part of this is not to pay off the bank. And I will say, last point, and as you know, the taxpayers shouldn't do it. In the bill that passed the conference committee which authorized this billion dollars, we said that the money should come not from the taxpayers but from large financial institutions that have more than $50 billion in assets and hedge funds with more than $10 billion. Republican opposition killed it. I'm going to refile that bill today.

So I invite my Republican colleagues to join me and we will sponsor this bill, and it's in the committee that the gentleman chairs. Let's pass a bill that says the money that will go to cities to knock down property where they can't find the owner will get it from the large banks and from the large hedge funds. And if the gentleman will agree with that, then this whole argument about the deficit will disappear.

But I will predict, Mr. Chairman, that they will find that that's not so persuasive, and they will put up with the deficit when it means saving money for the large banks.

Mr. Chairman, I yield myself 30 seconds.

First of all, this program has been going on for some time. If there were any of the horror stories to match those hypotheticals, we would have

heard from them. But I will say this to the gentleman from California. He admits under public safety, the city might have to go in and tear it down with no recompense. Here is my proposal, and I invite my Republican colleagues again to do this. Come back with us to when we had a bill that said, This program will be paid for not by the taxpayers but by an assessment on financial institutions with more than $50 billion in assets and hedge funds with more than $10 billion in assets. I will introduce this bill tomorrow. They can give us a hearing on it, mark it up, and it won't cost the taxpayers a cent. And it will save the cities money.

I now yield 3 minutes to the gentlewoman from New York (Ms. Velazquez).

(Ms. VELAZQUEZ asked and was given permission to revise and extend her remarks.)

How much time remains on both sides, Mr. Chairman?

I reserve the balance of my time.

I yield myself the balance of my time.

I appreciate the gentleman's acknowledgement. With all of their efforts, they are out finding pictures of abandoned houses, they couldn't find one example of where that abuse took place. In fact, there are a set of rules and restrictions that HUD has that I will submit under general leave. But again, let's review some of their errors. The fundamental error is the argument that this is a program which buys money from banks that have foreclosed and own the property. In fact, it is foreclosed and abandoned property. There are also entities that foreclose that weren't banks, that are not in existence anymore. Yes, it does not deal with all the properties. Where there is a responsible bank that you can go after, the cities go after them. But the suggestion that in Detroit, in Cleveland, in Boston, in Chicago, in all of our cities and in our rural areas there are no abandoned properties that lack someone you can sue is unreality. This is a triumph of ideological reflex over empirical observation. What this says to cities is, where you cannot find a responsible owner to go after, and the property is festering, if it's too far gone, you can tear it down. If it's not too far gone, you can take it and resell it for an affordable unit. Yes, it's got to be a limited income situation.

So that just disputes the whole notion that there's always somebody else you can get. But I still believe it's true that we shouldn't let this come from the taxpayer.

But I want to reiterate, and I'll make this offer. In the conference committee on Financial Reform, when this bill was passed--that's true also, by the way, of the emergency homeowners' relief--we said, let's not have it come from the taxpayer. Let's have it come from financial institutions with $50 billion or more in assets, except for hedge funds, where it's $10 billion or more in assets.

If that had passed, it would have cost the taxpayers, the general revenue nothing. It would not have added to the deficit. And to the extent that some financial institutions were benefiting,

they would have had to contribute. In fact, it would have had the larger financial institutions help the smaller financial institutions.

The Republicans killed that before, but I believe in repentance, Mr. Chairman. I believe in second chances for miscreants. I'm going to give, Mr. Chairman, my Republican colleagues a second chance. So for all their rhetoric about the deficit, here's the response. Here are the choices:

You can tell Detroit and Cleveland and other cities, you tear down that property when there's nobody else to go to and you pay for it and lay off some teachers and cops and firefighters, or you leave the property up there to fester. Or you do it our way. You join in assessing the large financial institutions. And I don't mean to demonize Citicorp or Bank of America, Goldman Sachs, Blackstone. These are decent people. They are trying to make a profit. I don't always agree with them. Why don't we let them pay the billion dollars?

So if there is a genuine concern about the deficit--I'm skeptical when people want to send the money to Afghanistan and Iraq and to Brazilian cotton farmers. Obama made them do that. Whenever they have a tough political decision, Mr. Chairman, Obama did it. Why can't they solve the problems of Fannie and Freddie? Well, Obama won't tell them how to do it. So they always hide behind the President when it's convenient.

But here's the deal. It is undeniable. Let's go back to the gentleman from Alabama. He found a building that was so decrepit he had a picture, and he said to us, You can go to the owner of that building and get the money. Well, he could find the building to take a picture, but he couldn't find the owner. Because I asked him, If that's the case, if we can go to the owner, tell me who the owner is and let's try and go after him. And he left the floor because he doesn't know who the owner is because in some cases nobody knows who the owner is because the property has been abandoned or it was foreclosed upon by an entity that's no longer in existence.

So join with us, make the large financial institutions and the hedge funds pay for this, and save the cities money that they do not have.

March 3, 2011.

Oppose Bills That Shut Out Homeowners and Abandon Communities

House Financial Services Committee, House of Representatives,

Washington, DC.

Dear Representative: The following civil rights and

consumer organizations are writing to urge you to vote

AGAINST the four bills coming before the House Financial

Services Committee tomorrow that would eliminate the primary

foreclosure prevention lifelines available to homeowners and

communities struggling to make it out of our economic

recession. For the reasons stated below, now is precisely the

wrong time to end these programs.

It is in the nation's interest to prevent foreclosures.

Everyone benefits when we can help families stay in their

homes. Preventable foreclosures cripple the overall economy

by adding vacant houses to the already flooded housing

market, further depressing housing prices and adding harmful

uncertainty to this critical market sector. An estimated

11.57 million borrowers--1 in 5--are currently in danger of

losing their homes. And unemployment and foreclosure now go

hand-in-hand. Despite the average length of unemployment now

at eight months, so many families who have lost their jobs or

seen a drop in income as a result of the recession are now

also losing their homes. We need to do more, not less, to

help these families and stabilize the economy.

It is in the nation's interest to bring communities back.

When families fail, communities fail. Families who have

suffered foreclosure will feel the impact of foreclosure for

years to come. Among many destabilizing consequences, they

must confront their lives' disruption, the loss of their

credit standing, and the higher cost and limited availability

of future credit. But the impact of the foreclosure crisis is

being felt far beyond the immediate home and neighborhood.

This crisis has devastated entire communities, which suffer

from a loss of community members, the disruption of community

institutions, a decline in property values, and an increase

in vacant and abandoned properties. Virtually every community

across the country is feeling the fallout in the form of

falling tax revenues and growing budget crises. Now is not

the time to cut the programs created to prevent the

foreclosures that fuel these broader problems.

Foreclosures continue to proceed at record levels, with

disproportionately heavy impacts on communities and families

of color, who are facing foreclosure at twice the rate of

other families because of discrimination. Foreclosure

prevention is a civil rights issue, and communities of color

are suffering a disproportionate loss of wealth. Several

studies have documented pervasive racial discrimination in

the distribution of subprime loans. One such study found that

borrowers of color are more than 30 percent more likely to

receive a higher-rate loan than white borrowers even after

accounting for differences in creditworthiness.\1\ Another

study found that high-income African Americans in

predominantly Black neighborhoods were three times more

likely to receive a subprime purchase loan than low-income

white borrowers.\2\ An analysis of loan, credit, and census

data has shown that even after controlling for percent

minority, low credit scores, poverty, and median home value,

``racial segregation is clearly linked with the proportion of

subprime loans originated at the metropolitan level.'' \3\

This research supports the conclusion that racial segregation

is itself an important determinant of subprime lending. The

resulting flood of high cost loans in communities of color

has artificially elevated the costs of homeownership for

residents of those neighborhoods.\4\

Homeowners need more help, not less, and the mortgage and

servicing industry has proven to be particularly ill-equipped

in providing it. A massive body of recent evidence exists

which shows pervasive lender foreclosure processing problems

and problems with mortgage transfers and assignments within

the securitization process. These shortcomings show a deep

disregard for legal requirements among lenders and servicers,

and also demonstrate that they are badly understaffed,

perform poorly, and lack accountability. Problems uncovered

in the foreclosure process mirror the problems that

homeowners seeking loan modifications have experienced:

borrowers frequently report an inability to reach bank staff,

loss of paperwork that they have sent in, and little

oversight or enforcement.

We cannot leave the important job of foreclosure mitigation

solely to an industry that has repeatedly refused to do the

job correctly. Just two days ago, HSBC suspended all

foreclosures after an investigation by federal regulators

uncovered ``problems in the company's processing,

preparation, and signing off of affidavits and other

documents supporting foreclosures, and in HSBC's management

of third-party law firms retained to carry out

foreclosures.'' \5\ Rather than eliminating the only

lifelines that help people from losing their homes, we should

be increasing that help. It is irresponsible to eliminate

these programs at a time when our nation needs them most.

Thank you for your consideration.

Sincerely,

Mr. Chairman, I don't think there's anybody exactly in opposition to the amendment because it doesn't do anything, but there is some opposition to the rhetoric; so I will claim the time in opposition to the gentleman's speech.

In the first place, there is a consistent misunderstanding on the Republican side manifested by their talking about this as a program that there was foreclosed property. That, of course, allows them conveniently to pretend that, for every piece of property that a city is stuck with, there is an entity that stood behind it that foreclosed and can be sued. But that's not true.

This is not only about foreclosed property. It is about foreclosed and abandoned property, and there is property that has been abandoned. It has been abandoned by the owner who's walked away. It has been abandoned by some financial institutions that did not have the substance of banks. There is demonstrably property in the cities which cannot be traced.

The chairman of the committee displayed a picture before of a beat-up piece of property and said, Look at this piece of property. It's so far gone, who would want to buy it?

We said, No one would. It should be demolished. Tell us who owns it.

He said, You can always find out who owns it--except for that piece of property.

So it's not just about foreclosed property. Somebody has to demolish property where there is no owner. Somebody has to demolish property where there is no responsible party standing behind it. I just left the Chamber to meet with three firefighters from the city of Fall River in my district. They were appalled at the notion that they would be left in the city of Fall River to deal with abandoned property, which is a set of fire traps, and not have any help. So for that reason, I believe that we ought to be clear that this is not about only foreclosed property. And some property, by the way, has been foreclosed upon by entities that are bankrupt, by entities that have no funds.

The other point I would make, though, is this. I do agree with my colleagues that we should do something about the deficit. Now, I wish that they listened to that when we subsidized agriculture or when we sent money to Afghanistan and Iraq for their social purposes. But I have an alternative. I will repeat again, and they'll ignore it all day, I know. In the bill that originally authorized this billion dollars, we required that it be funded not by the general revenues but by a special assessment on financial institutions that have $50 billion or more in assets and hedge funds at $10 billion.

Now let's be clear, Mr. Chairman. Members on the other side know this bill is unlikely to become law. Indeed, some have even said they understand the money will be spent before it can move. So the billion dollars is almost certainly going to be spent. My colleagues now have a choice. They can allow it to be spent by the taxpayers, or they can reconsider their opposition to our proposal of last summer and assess this on the large financial institutions and hedge funds. By the way, some of it, it is true, was caused by banks and some of it will go to banks.

But here's the answer. Instead of complaining that some of this will go to banks, join us and have it all come from banks and from hedge funds. But please, Mr. Chairman, let's not perpetuate the myth that, for every piece of property with which our poorer cities and rural areas are burdened, there is somebody they can go and sue and get it down. In fact, the gentleman from California himself has said, well, they can get a bulldozer and tear it down. Those bulldozers cost money. The people driving the bulldozers cost money.

So we believe that the approach should be to take money from the large financial institutions and from the hedge funds and take the billion dollars from them and provide it to municipalities and groups like Habitat for Humanity and others who will use it either to tear down the property, in some cases, or rehabilitate the property and make it affordable housing.

That, Mr. Chairman, is the choice between us. Again, I want to stress, this notion that it is only foreclosed property is a misstatement with a purpose, because it means that you ignore the fact that much of the property existing in the cities is abandoned and will only be dealt with by the city spending its own money or, by our preferred mode, having the large financial institutions and the hedge funds join us.

So I hope at some point today, one member of the majority will tell us whether or not they agree, Mr. Chairman, that if this program survives, we should get it not from the taxpayer and not from the property taxpayers of our cities or rural areas but from the large financial institutions. That's what I hope will happen.

What if it is abandoned and it is of not much value and has to be torn down, so people buy it and tear it down?

We were told, for instance, by Detroit and Cleveland, they have abandoned property. There is no owner they can find. Who's going to pay to knock it down?

Mr. Chairman, I ask unanimous consent that the voice vote by which amendment No. 1 was rejected be vacated to the end that the Chair put the question de novo.

The gentleman is listing those numbers. Would the gentleman tell us what the maximum number is he thinks people should be eligible to get a house through the FHA and Fannie Mae and Freddie Mac.

From my recollection, I was struck by the gentleman talking about those figures, that they were too high, because the last I heard, the gentleman and I were together in trying to establish--

Will the gentlewoman yield?

I just would say that the gentleman from California previously had agreed with some of us that you could be able to get a house in the FHA for up to $729,000.

Will the gentleman yield to me briefly?

Mr. Speaker, it's amazing to me that we're here at this time when we've seen 4 million foreclosures across America, perhaps 7 million. We've seen neighborhoods devastated. And instead of the majority conference offering solutions to this foreclosure crisis, instead of them coming forth and saying, You know what, here's what we think we need to do for the American people to stay in their homes, all they want to do is destroy what Democrats have done. It's amazing. It's really something that I hope the American people pay very close attention to.

The gentleman on the other end says that, Look, somebody's going to buy the house that you lost in foreclosure. If we can be successful with programs like the Neighborhood Stabilization Program, we will create an environment where people will not lose their homes because the value of their homes will not plummet. They will not end up underwater. And people will have somewhere that they can live and a neighborhood that they can be proud of.

But because the Republican conference is making itself abundantly clear, I think it needs to be clear to the American people whose side we're on. The Democrats are on the side of the American people staying in their homes. The Republican conference is on the side of throwing people out and foreclosing on Americans. And it's a sad, sad day in our Congress. We are in the middle of an enormous debate on the proper role of government. We believe the proper role of government is to have fair rules, to have real enforcement of our financial regulations, to have real consumer protection, and to intervene when people's neighborhoods are being destroyed by foreclosure.

The Republicans say, You're on your own. The market has all the answers. The market answers every question. Well, it doesn't answer every question, especially when the market doesn't have any cops on the beat, and when you let the people engage in all sorts of nefarious practices that caused the economic conditions that we're in today.

The Republican conference was in power when the regulations that led to this destruction were in place--and they did nothing. When the Democrats got in charge, we solved it. And now they're trying to disassemble it.

Mr. Chairman, I have a preferential motion at the desk.

Mr. Chair, I rise to make this motion today because I'm opposed to the underlying bill, the NSP Termination Act.

Mr. Chair, in the course of this debate on the termination of foreclosure mitigation programs, including this bill, we've been enmeshed in a huge debate around what the proper role of government is.

The Republican Caucus clearly thinks that government has no role, that citizens are on their own, and that no matter how much devastation a particular phenomenon like the foreclosure crisis has caused, that citizens just have no help in the government. The government can't be there for them.

And, on the other hand, the Democratic Caucus, we believe that, in the proper circumstances, the government has an important role and does need to be there for the American people, and when we see property values dropping, whole neighborhoods destroyed, that we should do something about it.

This motion to strike the enacting clause, according to Rule XVIII, clause 9, ``if carried in the House, shall constitute a rejection of the bill.''

And, Mr. Chair, I urge that we do reject this bill. This bill is an affront and an insult at a time when Americans have seen over 4 million foreclosures across this Nation, devastating whole communities, devastating communities and wiping out city and municipal budgets, so that cities, when they have abandoned properties in their neighborhoods, are left with tearing them down and demolishing them on the nickel of the taxpayer in that city when, in fact, this is a community-wide problem.

There's no money in many cities to do the demolition. So what will happen is that an old, burned-out hulk will sit there and sit there as neighbors look on and see the property values in their homes plummet. And what we'll see, Mr. Chair, is people leaving dogs there. Perhaps the house will be an attractive nuisance. Perhaps some crime will be committed there, drug dealing there, dead animals left there, and neighborhoods will fall deeper and deeper in despair.

I grew up in the city of Detroit. I'm honored to represent the Fifth District of Minneapolis today, but I grew up in the city of Detroit, and I saw how the foreclosures in that city ripped that town apart. And the good people of that city had to sit by and watch folks burn houses. They would put them on fire, and years later, no money to demolish them that the city had, and it just helped folks say that, You know what? I'm going to leave this city because I can't stand to live here with that big hulk right next to my home. Who's going to help out?

Well, according to the Republican Caucus, that's not the proper role of government. And this is really what this is all about.

Mr. Chairman, I've heard our friends in the Republican Caucus talk about jobs, yet they haven't introduced one single jobs bill, and we've been here for 11 weeks.

They talk about the deficit and go on and on ad nauseam about putting debt on our children and grandchildren. And yet, when they had the chance to raise revenue so that we could, in fact, pay the bills of this country, they were absolutely and adamantly opposed to it.

But now, when we see Americans have their neighborhoods slipping into oblivion, slipping into a situation where people can't live in their neighborhood and people can't sell their homes so they're just suffering, the Republican Caucus said, There's nothing we can do for you either.

They don't really demonstrate a commitment to jobs. They don't really demonstrate a commitment to even dealing with the deficit, at least not through revenue raising. They have a commitment to set Americans adrift, on their own.

I make this motion to correct the record on this Neighborhood Stabilization Program. This isn't a broken or ineffective program that should be eliminated. It is a vitally important program for local and State governments that need all the resources they can get to address neighborhoods that are overrun by foreclosures.

According to HUD, the Neighborhood Stabilization Program has supported close to 100,000 jobs nationwide. They will be eliminated if we pass this bill. That's right. The Republicans, again, are cutting another 100,000 jobs for working Americans.

So, Mr. Chair, what does the Neighborhood Stabilization Program do?

It helps local and State governments renovate abandoned and foreclosed properties. It helps local governments revitalize communities instead of watching these neighborhoods deteriorate. It gives communities the ability to get back on their feet as quickly as possible.

In my district, the city of Minneapolis has put NSP funding to good use. Thomas Streitz is the director of Housing and Policy Development for the city of Minneapolis, and he explains: ``The Neighborhood Stabilization Program has enabled the city of Minneapolis to stabilize neighborhoods throughout the city affected by foreclosure. Funding to date has impacted more than 530 properties, and with the additional funding sought, 56 more properties could be rehabilitated, bringing even more homeowners back into neighborhoods.''

I believe the NSP is a good investment.

Mr. Chair, I demand a recorded vote.

I have an amendment at the desk.

Mr. Chair, I yield myself such time as I may consume.

The middle class is shrinking and deficits are rising because the Republicans are giving a pass to special interests who cheated homeowners and wrecked our economy. Instead of working to keep middle class families in their homes, the Republican plan is to foreclose on the American middle class. The American people sent us here to protect the American Dream, not to perpetuate a Wall Street nightmare. Democrats are standing with the American people to create good-paying American jobs and to keep them in their homes. Democrats are working to ensure that every American who wants a good job, can find one, and that middle class Americans can afford to buy a home and live the American Dream.

The legislation on the floor today proposes cutting funding for the Neighborhood Stabilization Program. Republicans want to foreclose on the middle class, and my amendment forces Members to look at how this legislation will impact their State. So far, for each Member, if you read my amendment, you will see how much funding may be

cut from your State. My feeling is that before Republicans vote to cut funding for a successful housing program and a foreclosure mitigation program, they should know how much funding is at risk for their State and what the people back home are going to think about their vote.

This legislation to cut housing funding makes it clear that the majority is not focused on creating jobs. The Neighborhood Stabilization Program helps local communities redevelop abandoned and foreclosed properties, and that funding helps to create jobs. It takes workers to demolish an abandoned building.

Overall, the Neighborhood Stabilization Program has created about 93,000 jobs. This legislation to cut NSP funding is just another bill offered up by the majority that will actually cut jobs. The unemployment rate is currently 8.9 percent. This rate is far too high. It is wasting human capital. People's skills and talents are sitting on the sidelines instead of being put to good use and earning a good paycheck. Unemployed Americans are ready to get back to work, and we must use every tool at our disposal to create new jobs.

Instead of creating jobs, the Republican majority is launching an attack on American workers and foreclosing on the American Dream. The Republican plan to cut funding and cut jobs won't help our economy. It's going to do the opposite. It's going to hold back our economic recovery. The continuing resolution passed last month by the majority would cut $60 billion from programs and agencies that help the middle class and working families.

Economist Mark Zandi has estimated these cuts would result in the loss of 700,000 jobs. We can't afford to add to the already unacceptably high level of unemployment in this country. Republicans in Congress are pushing a reckless and irresponsible plan that protects tax breaks for millionaires and giveaways for corporate special interests at the expense of the middle class.

I urge my colleagues to support my amendment and to vote against the underlying bill.

I reserve the balance of my time.

I yield myself the balance of my time.

Two particular points, Mr. Chair. One is that, first of all, there's never been a program from any State, Federal, or local program that did not need review. I can tell you that in the city of Minneapolis, and in many other places, this program has been high quality and has been well, well run.

Now, the question is interesting because if the gentleman wanted to talk about inefficiencies in a program, we could talk about fixing those programs. We're not talking about fixing the NSP program. We're talking about eliminating it. So I think if this was a sincerely made point, that we would be talking about how we can improve the program. We should mend it, not end it.

Secondly, this amendment that I'm offering tries to inform Members as to the losses that their communities will endure by cutting the program. This program elimination will be felt across America in local communities where foreclosures are happening, and in those particular communities Members should know what is going to happen: that expenditures for demolishing and rehabilitating abandoned homes are not going to be there any more. And I think it's important the Members should know. And I think it's important that the people who live in the Members' communities should know.

And so I ask that the amendment be adopted.

I yield back the balance of my time.

Mr. Chairman, I demand a recorded vote.

Mr. Chairman, I have an amendment at the desk.

I yield myself such time as I may consume.

Mr. Chair, the middle class is shrinking and deficits are rising because the Republicans are giving a pass to special interests who cheated some homeowners and wrecked our economy. Instead of working to keep the middle class families in their homes, the Republican plan is to foreclose on the American middle class.

The amendment I have right here in front of you describes findings which talk about the positive benefits of the Neighborhood Stabilization Program. This program is a good program, and no matter what may happen here today, the record should reflect the benefits of this program. This program was good, and the amendment offers language which sets forth findings, and the findings state the positive impacts of the Neighborhood Stabilization Program, including assisting local governments, supporting jobs, and impacting approximately 100,000 properties.

The highlights of this amendment about the Neighborhood Stabilization Program talk about the positive benefits to the communities that the Neighborhood Stabilization Program benefited--it helped local governments, and the fact is, Mr. Chair, local governments really did benefit from this program, and the record should reflect and the bill should report language that talks about those benefits.

I'd like to just say this as well, Mr. Chair. The fact is that it is true that once an abandoned property is sitting there on the tax rolls after a certain amount of time somebody may at some point buy it, as the gentleman on the other side says. But what happens in the meantime? In the meantime, the grass grows, dead cats and dogs get left there. In the meantime, the windows are broken. In the meantime, people's property values plummet. In the meantime, we have an attractive nuisance where young people might be pulled in and taken advantage of. Horrible stories have happened, Mr. Chair.

So the gentleman has been right in his argument that sometime in the future maybe somebody will buy this rundown, abandoned, stripped-out property with no copper left in it, with neighbors who have just been decimated in the value of their homes, but that would be a far cry from what we could do. And if we're going to terminate this program, which has helped so many local governments, we should at least put language and findings in the record which reflect the positive aspects of this program, including the 93,000 jobs that we're getting rid of and

the 100,000 properties that we've already helped, and the more that we could help.

I reserve the balance of my time.

May I inquire as to the remaining time?

Mr. Chairman, let me only add this: that this language, which should be put in the bill and this amendment calls for, sets forth in the record the positive impacts of the Neighborhood Stabilization Program, which should be memorialized in the bill, things like job creation, saving the neighborhood, saving local governments exorbitant costs. The Republican caucus has not created a single job, and now they're even eliminating jobs.

I yield back the balance of my time.

Mr. Chairman, I would like to address two things that the minority has raised. One is they've talked about fairness. And I will tell you that there's nothing fair about this program. In fact, it's an unfair program. It's unfair for most Americans. The second thing they've talked about is foreclosures. This program causes foreclosures. This program encourages foreclosures. This program promotes foreclosures.

Now let's talk about the foreclosures first and then we'll talk about fair. What does this program do? Does it prevent foreclosures? No. It encourages foreclosures. It allows nonprofits, community organizations, and cities and counties to buy foreclosed properties. In other words, to create a market for foreclosed properties. The minority supplied us with pictures of two of these properties. This is the one in Baltimore, Maryland. This was one of two. I think the other one was in Los Angeles, as I recall. This is the property.

Now, just like all these properties, it's not owned by a homeowner. There's no homeowner there. It's owned by a bank or a real estate speculator. It might have been somebody that put someone in this house with what we call an exploding loan. Put someone in that house that couldn't afford it.

So, what do we do? We construct a program that says to this bank that owns this property, that's paying taxes to the government on this property--we don't say to tear this down, or we don't say we're going to condemn it and convert it, and we're going to get it with no charge. No. We buy it. Now, is that right?

You said the banks caused this, the lenders. We ought to penalize those that are at fault. Well, how does penalizing a lender who made a loan on this property, how is writing them a check fair? No, it's not. This is a bailout for lenders and speculators. Now, is it fair? Well, is it fair to our grandchildren and our children, $4 billion every day that goes out of our Treasury, more than we bring in. Four billion dollars a day. In fact, the deficit for February was 230-something billion dollars.

Now, every day they talk about fairness, and I have quoted this with every one of these failed programs. I have quoted Mike Mullen, chairman of the Joint Chiefs of Staff, who says our debt is the biggest threat to our national security, the existence of our country. Well, let's just talk about one thing we do every day. We owe China 9\1/2\ percent of our debt; 9 to 9\1/2\ percent is owed to China. Every day we write a check to China because we won't face up to this exploding spending of $120 million a day.

They could buy a Joint Strike Force Fighter every day and still put $20 million in their pocket. Every day. They could build an Air Force bigger than our Air Force in 5 years on money they earn from us and that our taxpayers pay because we won't confront programs like this. Because ``fair'' to us is saying yes to everyone except the taxpayers.

And, oh, there are 4 million foreclosures in this country this year. That's a terrible figure. But I tell you, this program will do nothing but increase that number. And to think that it's fair to our children and grandchildren to devise a program but not have the money to pay it and stick it on our children and grandchildren, it ought to infuriate any of us who are grandparents. It does me.

It's time now to end this foolishness which threatens the very existence of our country.

Well, there you go again. Instead of talking about this program, you want to talk about the Brazil cotton deal, or you want to talk about Afghanistan. And I'll talk about those.

But before I do, I have a question for you, for my colleagues on the Democratic side who talk about investing in this property. I want you to get a good look at this.

Are you willing to put your money up to buy that?

I yield to the gentleman from Massachusetts.

Let's tear it down. I agree with you. And let's make the person who owns it tear it down. And this idea that this person can't be found, that this person----

I would ask for order.

Announcement by the Chair

And I would say to the Chair--and I appreciate that--that if any of my colleagues want to buy this property and think it's a good investment, they can hire painters and Realtors and put all these people to work, but the taxpayers, they're having trouble paying their own mortgages. They're having trouble financing their own children's education. And whose side are we on?

Listen, this program has benefited less than 2,000 pieces of property--banks--but we've got 12 million American families who are underwater on their mortgage. And do you think it's even fair to pay off, as y'all proposed, a half a million of those mortgages? How about the other 21 out of 22? You know, you can't pay off all 12 million. You will break the country. So you say, well, we're going to do the best we can. You're going to pick winners and losers.

Let me tell you something. The taxpayers that are paying their mortgages or own their own homes or didn't get into this problem--don't you get the message from November? The American people don't want us paying--they don't want to pay for someone else's obligations.

Now, let's talk about this Brazilian cotton, and let me tell you, if I were you--I'd say to the Chair, if I were the ranking member, I would talk about anything but buying this property and fixing it up. I'd do anything to avoid that conversation. I'd avoid anything to talk about that we're paying the banks with taxpayer money.

But you mentioned Brazil and you said it was a stupid deal. You said it took a Flip Wilson to do this. Well, it was Ron Kirk, trade ambassador, that entered into the agreement. And who hired him? President Obama. So you ought to take it up with the Democratic administration who saddled us with this $150 million obligation.

I close with Afghanistan. I have a son who's in the U.S. Marines. He was in there for 10 years and he's out now, but let me tell you something. I will spend money to build up an Afghan force so we can bring our young men and women home.

[From the Office of the United States Trade Representative, Executive

Office of the President]

U.S., Brazil Agree on Framework Regarding WTO Cotton Dispute

Washington, DC.--Today Brazil's Ministers reached a

decision in support of a Framework regarding the Cotton

dispute, which would avert the imposition of countermeasures

of more than $800 million this year. This includes more than

$560 million in countermeasures against U.S. exports which

were scheduled to go into effect on Monday, June 21, 2010, as

well as possible countermeasures on intellectual property

rights that could have taken effect later. We are pleased

with this decision, and look forward to signing the Framework

soon.

The findings in the Cotton dispute concern U.S. cotton

support under the marketing loan and countercyclical payment

programs, and the GSM-102 Export Credit Guarantee Program. In

line with these findings, the Framework has two major

elements.

First, it would provide, as a basis for a discussion toward

reaching a mutually agreed solution to the dispute, a limit

on trade-distorting cotton subsidies. Second, the Framework

would provide benchmarks for changes to certain elements of

the current GSM-102 program. In the Framework, the United

States and Brazil would agree to meet quarterly to discuss

the successor legislation to the 2008 Farm Bill as it relates

to trade-distorting cotton subsidies and the operation of

GSM-102. The Framework would not serve as a permanent

solution to the Cotton dispute. However, it would provide

specific interim steps and a process for continued

discussions on the programs at issue with a view to reaching

a solution to the dispute.

``I am pleased that we have been able to negotiate a

Framework regarding the WTO Cotton dispute that would avoid

the imposition of countermeasures against U.S. trade,

including goods and intellectual property,'' said Ambassador

Kirk. ``While respecting the role of the United States

Congress in developing the next Farm Bill, this Framework

would now allow us to continue to work toward a final

resolution of the Cotton dispute. I believe this Framework

will go a long way in alleviating the uncertainty in our

business communities and enhance the ability of the United

States and Brazil to build upon our dynamic trading

relationship.''

``This framework agreement provides a way forward as we

work with Congress toward a new farm bill in 2012,'' said

Secretary of Agriculture Tom Vilsack. ``Although it is not a

permanent solution, I am pleased that it allows us to

maintain our programs while considering adjustments and

avoiding the immediate imposition of countermeasures against

U.S. exports as a result of the WTO cotton decision.''

Background

The Cotton dispute is a long-running dispute brought by

Brazil against the United States. In 2005 and again in 2008,

the World Trade Organization (WTO) found that certain U.S.

agricultural support payments and guarantees are inconsistent

with WTO commitments: (1) payments to cotton producers under

the marketing loan and countercyclical programs; and (2)

export credit guarantees under the GSM-102 program, a USDA

program used to provide guarantees for credit extended by

U.S. banks or exporters to approved foreign banks for

purchases of U.S. agricultural exports.

On August 31, 2009, WTO arbitrators issued arbitration

awards in this dispute. These awards provided the level of

countermeasures that Brazil could impose against U.S. trade.

The annual amount of countermeasures has two parts: 1) a

fixed amount of $147.3 million for the cotton payments and 2)

an amount for the GSM-102 program that varies based upon

program usage. Using the data that we have given Brazil (in

accordance with the arbitrators' award), the current total of

authorized countermeasures is more than $800 million.

The arbitrators also provided that Brazil could impose

cross-sectoral countermeasures (i.e. countermeasures in

sectors outside of trade in goods, specifically intellectual

property and services). It may impose cross-sectoral

countermeasures to the extent that it applies total

countermeasures in excess of a threshold. The threshold

varies annually, but is currently approximately $560 million.

Therefore, of the approximately $820 million in

countermeasures Brazil could impose now, about $260 million

of that could be cross-sectoral.

On March 8, 2010 Brazil announced a final list of products

that would face higher tariffs beginning on April 7, 2010.

Goods on the list include autos, pharmaceuticals, medical

equipment, electronics, textiles, wheat, fruit and nuts, and

cotton. Brazil had not made a final decision on which U.S.

intellectual property rights might be affected by cross-

sectoral countermeasures, but it had begun the process to

make this determination.

On April 1, Deputy USTR Miriam Sapiro and USDA

Undersecretary for Farm and Foreign Agricultural Services Jim

Miller met with Ambassador Antonio Patriota, Secretary

General of Brazil's Ministry of External Relations to discuss

possible resolution of the dispute. As a result of that

dialogue, the Government of Brazil agreed not to impose any

countermeasures on U.S. trade at that time. In exchange, the.

United States agreed to work with Brazil to establish a fund

of approximately $147.3 million per year on a pro rata basis

to provide technical assistance and capacity building to the

cotton sector in Brazil, and for international cooperation

related to the same sector in certain other countries. Under

the Memorandum of Understanding that the United States and

Brazil signed on April 20, 2010, the fund would continue

until passage of the next Farm Bill or a mutually agreed

solution to the Cotton dispute is reached, whichever is

sooner. The fund is subject to transparency and auditing

requirements.

The United States also agreed to make certain near term

modifications to the operation of the GSM-102 Export Credit

Guarantee Program, and to engage with the Government of

Brazil in technical discussions regarding further operation

of the program. In addition, the United States published a

proposed rule on April 16, 2010, to recognize the State of

Santa Catarina as free of foot-and-mouth disease, rinderpest,

classical swine fever, African swine fever, and swine

vesicular disease, based on World Organization for Animal

Health Guidelines, and to complete a risk evaluation and

identify appropriate risk mitigation measures to determine

whether fresh beef can be imported from Brazil while

preventing the introduction of foot-and-mouth disease in the

United States.

The parties further agreed on April 1 that they would work

to develop a Framework regarding the Cotton dispute by June

21, which

would provide a path forward for a negotiated solution to the

Cotton dispute and allow both countries to avoid the impact

of countermeasures. Negotiators from Brazil and the United

States have been engaged intensively over the past several

months, and successfully concluded this Framework.

Brazil is the United States' 10th largest trading partner

with a total two-way goods trade of approximately $60 billion

in 2009.

Well, let me ask you this----

It was the person that you wrote the check to. You have to buy it, and you wrote the check out. So you know who the owner is.

You wrote the check to somebody.

Well, let me ask you this: The IG said they couldn't trace some of this money, and I think we've all figured that out. If we don't know whom we're paying----

Mr. Chair, I yield 2 minutes to the gentleman from Minnesota (Mr. Ellison).

Mr. Chairman and Members, I think that my colleague from Minnesota said it all: Whose side are you on? Are you on the side of the American taxpayers who trusted us to regulate this industry that had responsibility for these mortgages? Are you on the side of taxpayers who simply wanted to live the American Dream, who simply wanted to get into a mortgage so that they could own a home and do what it is the American Dream says we can do and we can accomplish?

They trusted us to make sure that our regulators did their job. We all let them down. We allowed these mortgage firms, these loan initiators, these big banks to create these exotic products, products we had never heard of before.

Nobody questioned what was a no doc loan. Nobody asked what is this teaser loan. Nobody talked about what happens when these loans reset. And the American taxpayer was confronted with a mortgage with 30, 40 pieces of paper and they signed on the dotted line, because they wanted to live the American Dream. Little did they know that they would not be able to meet the reset amount, 6 months, 1 year, 2 years from now; and so they got caught up in the scheme. It was a huge, fraudulent scheme perpetrated on the American people by major financial institutions.

Americans didn't decide all of a sudden that they didn't want to pay their bills, that they didn't want to pay their mortgage. Something big happened. And what happened was this big fraud that was perpetrated on the American people came to reality and the devil came due, and now it was time to pay, and they couldn't afford it.

Added to that, the recession that was caused by the subprime meltdown caused people to be in situations where they lost their jobs, or they were now in jobs that paid less than the jobs that they had when the economy was good. And so now we have people who have lost all these homes. They're foreclosed on, they're boarded up, they're abandoned. And, guess what, they're bringing down the neighborhoods. Those people who stay in the neighborhoods and keep up their homes, they're losing value because of these boarded-up properties and because of these abandoned properties.

So the government said, and I said and Barney Frank said, those of us who created this program said, we have a responsibility to help the American people, because, through no fault of their own, now their homes are underwater, their homes have lost value, and so we have the Neighborhood Stabilization Program. The Neighborhood Stabilization Program does give money to counties and cities and nonprofits and all to go in and rehab these properties, put them back on the market, upgrade the neighborhood, reduce the cost to fire and police and all of those city agencies that now have got to look after these boarded-up properties, where the animals are coming in and the weeds are growing up and neighbors are saying, My government, please help me.

That's what the Neighborhood Stabilization Program is all about. And it creates jobs. It creates jobs, because now we've got the contractors, the subcontractors, the painters, the Realtors all involved in helping to rehab this neighborhood, helping to stabilize these communities, creating jobs, assisting the American taxpayers who got into these situations through no fault of their own.

Whose side are you on? Are you on the side of those who rip off our taxpayers? Or are you on the side of the taxpayers who sent you here to look after them and to be responsible?

Madam Chair, I have an amendment at the desk.

Madam Chair, my amendment would simply require the Secretary of the Department of Housing and Urban Development to send a notice to all of the NSP grantees who would have received funding under the third round of NSP that the program has been terminated. Further, the notice would include the name and contact information for the Member of Congress representing that grantee's district, along with a notice saying that the grantee can contact that Member directly for assistance in mitigating foreclosed properties.

As you know, we passed such an amendment off the floor when we took up the FHA bill, which would have basically allowed the homeowners to refinance their properties. So we have one such amendment with the elimination of that program.

The CBO has scored this amendment at zero cost. Since the passage of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, which provided the NSP funds that are now subject to this repeal, my office has received many calls from potential grantees about the status of the program and what funding they could expect.

Because this act would rescind those funds nearly 8 months after the passage of Dodd-Frank, I think that a simple letter from HUD, sent to States, counties and cities, which would simply notify them of this change, is in order. Moreover, a note to these States, counties and cities saying that their Members of Congress are available to assist them in mitigating foreclosed properties can help these grantees find alternative solutions.

I've discovered there are any number of Members starting to do this kind of thing. They are getting calls from their constituents who are asking for help with loan modifications, and the Members are able to, not get involved with the particular problem, but to help guide them and send them to the proper servicers to get their loan modifications. This is similar to that. Simply, our office has been able to say: Yes, the program is no longer in existence, but this is what you can do if there is an alternative.

Now, I would prefer not to rehash the back-and-forth we saw in the Financial Services Committee about the termination of this program. Members on my side of the aisle showed pictures, talked about the problems caused by abandoned properties, and even showcased letters from their districts, letters which talked about the good work NSP was doing. Yet the debate, it seems, will not sway my colleagues on the other side of the aisle. Instead, I think it's best to focus on my amendment.

I believe this is a commonsense provision that can be accepted by both sides of the aisle regardless of whether they agree with the underlying bill. Grantees should be made aware of this funding recision, and Members of Congress should stand ready to help communities mitigate the effects of blighted properties.

I would ask for the support of my colleagues.

I reserve the balance of my time.

Madam Chair, I have heard so many convoluted arguments today about this legislation from the opposite side of the aisle.

My colleague from California, my friend and someone I highly respect, knows that he does not have to wish what an amendment would say. If he is interested in an amendment, he can offer it. My colleague from California did not offer the amendment that he has just alluded to, and he did not suggest when we were in committee that somehow he would like to have an alternative. So I find it rather curious that he would come to the floor and start wishing what my amendment would say.

Secondly, I want to straighten out something. My colleague from California keeps talking about how this bill does not stop any foreclosures. The NSP legislation was not intended to stop foreclosures. It was intended to do exactly what the name implies, which is to stabilize communities by taking these boarded up and abandoned properties, rehabbing them or tearing them down so that they discontinue the devaluing of the properties of those homeowners who are trying to keep

their properties up and stay in the community.

If he, in fact, was concerned about helping homeowners, he would have supported the FHA refi programs. That program, he voted against. The FHA refi program was basically a program for middle class people who paid their bills on time, but who simply knew that their homes were underwater. They were not worth what they thought they should be worth when they got into the market, and they want to refinance them. He voted against that.

So I am not so sure, when he talks about this NSP program not helping anybody stay in their homes, whether or not he really, really wants to help people stay in their homes when he is voting against something like the FHA refi.

As for jobs, this bill creates jobs; and I think my colleague knows that.

I yield back the balance of my time.

Madam Chair, I demand a recorded vote.

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

My amendment would direct the Secretary of HUD to conduct a study to determine the approximate number of foreclosed and abandoned properties that will not be purchased or rehabilitated in the district of each Member of Congress as a result of the rescission and termination of funding under this act. The Secretary would then report these findings to Congress. CBO has scored this amendment at zero cost.

Now, personally, I do not believe that the Neighborhood Stabilization Program should be terminated because NSP creates jobs. So far, about 72,000 housing units are projected to be impacted by round one of NSP. HUD projects that an additional 24,000 housing units are projected to be impacted by NSP2.

Each of these projects requires the work of contractors, such as roofers and painters and landscapers and pavers. And through the program, other real estate professionals like Realtors and title insurance agents have also received employment and contracting opportunities. This NSP program really does create jobs, and this is a program that creates jobs by doing important work in the community.

Contrary to what some say, the problem of homes abandoned by banks is common, and it is difficult for municipalities to mitigate their effects. As GAO has noted in a report from November 2010, servicers sometimes charge off properties or fail to formally foreclose on borrowers because the costs of maintaining the property post- foreclosure exceed the costs of just writing the property off. These charge-offs typically occur after the foreclosure proceedings were initiated. However, borrowers aren't aware that the servicers are stopping short of taking their title.

Because borrowers think that their servicer has finalized the foreclosure process, they may move away and become unreachable by the municipal agency now dealing with the upkeep of the property.

Additionally, it may become logistically difficult or cost prohibitive to track down thousands of borrowers now responsible for property maintenance, taxes, and code violations because of servicers' failure to formally foreclose.

Additionally, NSP provides an alternative to speculative investors purchasing foreclosed properties. Unlike homeowners and municipalities, some speculative investors often purchase properties for cash and in bulk, sometimes sight unseen, buying them up before others have a chance to bid. Some of these investors may not resell properties to owner-occupants, but let them sit on the market without any improvements while the investor waits for housing prices to rebound.

Alternatively, anecdotal evidence suggests that investor-owners sometimes rent properties out to tenants with little or no rehabilitation or maintenance of the property.

We had a field hearing in Minneapolis in January 2010. At that field hearing, State Senator Linda Higgins said, ``Homes are being snapped up by investors. Some are clueless about how to rehabilitate a building and get good tenants. Others think that the laws really aren't meant for them. They buy a house for pennies, paint the wall, scrub the kitchen appliances, and rent it out. They forget the small details like the condemnation order and the requirements for lifting the condemnation and getting a new certificate of

occupancy and the need for a rental license.''

That is not to say that all private investment is bad, but we must recognize that the work NSP is doing is a critical counterweight to some of these bad practices. For all of these reasons, I will defend the work that NSP is doing across the country. However, we are here now because we need to talk about this amendment and what it would do once this program is terminated.

My NSP study amendment would provide critical information to Members of Congress. If Members knew the number of abandoned and foreclosed properties in their district that will not be mitigated because of this rescission of funds, they would be better prepared to help grantees access responsible private market sources of funds that can help community revitalization. I would ask my colleagues' support.

I yield back the balance of my time.