Helping Families Save Their Homes Act of 2009--Continued

Floor Speech

HELPING FAMILIES SAVE THEIR HOMES ACT OF 2009--Continued -- (Senate - May 05, 2009)

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AMENDMENT NO. 1040 TO AMENDMENT NO. 1018
(Purpose: To amend the McKinney-Vento Homeless Assistance Act to reauthorize the Act, and for other purposes)

Mr. REED. First, let me commend Chairman Dodd for his leadership on this very important legislation that is going to address one of the most significant issues facing America today; that is, restoring the value in our homes, but also giving people the hope that they can stay in their homes and helping those people who are displaced from their homes to find adequate, suitable housing.

I hope to be able to offer an amendment which would address the issue of homelessness in the United States.

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The Senator from Rhode Island [Mr. Reed], for himself, and Mr. Bond, proposes an amendment numbered 1040 to amendment No. 1018.

(The amendment is printed in today's Record under ``Text of Amendments.'')

Mr. REED. This legislation is cosponsored by Senator Kit Bond, Senator Boxer, Senator Collins, Senator Durbin, Senator Kerry, Senator Lautenberg, Senator Levin, Senator Lieberman, Senator Schumer, and Senator Whitehouse. It embodies legislation I introduced earlier this year, along with Senator Kit Bond, the Saving the Homeless Emergency Assistance and Rapid Transition to Housing Act, known in short as the HEARTH Act.

I want to particularly commend Senator Bond for his support, help, and leadership in this effort. He has been an advocate for sensible housing programs, not only on the floor of the Senate but particularly in his duties as a member of the Appropriations Committee and as the Ranking Member of the Subcommittee on Transportation and Housing and Urban Development.

He has been a great leader in advocating for the sensible, sound, and efficient use of taxpayers' resources to help people to find affordable housing. I thank him very much for his assistance, along with all of the other cosponsors.

This legislation is endorsed by the National Alliance to End Homelessness, U.S. Conference of Mayors, the League of Cities, NACo, Habitat for Humanity International, National Association of Local Housing Finance Agencies, LISC, Enterprise, National Low Income Housing Coalition, Corporation for Supportive Housing, the National Equity Fund, NAMI, the Housing Assistance Council and the National Community Development Association. It enjoys widspread support.

According to the Homelessness Research Institute at the National Alliance to End Homelessness, 2.5 to 3.5 million Americans experience homelessness each year. On any one night, approximately 672,000 men, women, and children are without homes.

While strides have been made to reduce homelessness over the last couple of years, the current economic decline has halted such progress.

Today I saw a front page article with a photograph in USA Today of a tent city going up. This is a phenenoman we thought was an artifact of history. Too often people are using any means to shield themselves from the elements.

Organizations such as Amos House, a shelter in my home State of Rhode Island, are seeing an increased demand for their services, while at the same time they are facing budget cuts and the economic downturn has curbed charitable donations.

I don't need to tell anybody in this Chamber how urgent this crisis is.

Across the country, we have already seen tent cities forming; shelters turning away people in need; and most major cities reporting double-digit increases in the numbers of families experiencing homelessness.

There is a tendency to view homelessness as something that happens to a few adults, men and women. But too many children are without homes.

As foreclosure and unemployment rates continue to rise, more families are being pushed out of their homes. Not everyone ends up on the streets. Some are able to move in with friends or family members, but they can not afford a home of their own and they can not find a job to get back on their feet.

America has not seen this level of displacement since the Great Depression and we simply cannot afford to ignore this problem.

That is why I am offering the Homeless Emergency Assistance and Rapid
Transition to Housing, HEARTH, Act of 2009 as an amendment to the Helping Families Save Their Homes Act.

The Banking Committee, of which I am a member, has worked long and hard on this legislation, which I believe has resulted in a very strong piece of legislation.

This amendment invests $2.2 billion for targeted homelessness assistance grant programs and provides local communities with greater flexibility to spend money on preventing homelessness.

While strides have been made to reduce homelessness over the last couple of years, the current economic decline has halted that progress and threatens to overwhelm it.

As a result of the recession, 1.5 million additional Americans nationwide are likely to experience homelessness over the next 2 years according to estimates by the National Alliance to End Homelessness. In Rhode Island, the latest numbers show homelessness is up 43 percent since February of 2008. And the number of shelter residents who cited foreclosure as their reason for becoming homeless tripled in the last 8 months.

This means more trauma for children and adults, more dislocation from schools and communities, and more of a drain on local community services.

In addition to the $2.2 billion for HUD homeless assistance programs, the HEARTH Act would also provide up to $440 million to be used to serve people who are not homeless yet, but are at risk of homelessness. That, I think, is in accord with the spirit of the legislation Senator Dodd proposed; to prevent people from losing their homes.

It would allow cities and towns to serve people who are about to be evicted, live in severely overcrowded housing, or otherwise live in an unstable situation that puts them at risk of homelessness. The money could be used to make utility payments, security deposits, and provide short- and medium-term rental assistance.

The HEARTH Act would increase the emphasis on performance by measuring applicants' progress at reducing homelessness and providing incentives for proven solutions like rapid re-housing for families and permanent supportive housing for chronically homeless people.

This is a measure not only to provide resources but also to insist upon accountability.

Today, more families than ever are living on the edge, but the national safety net is not as big or as durable as it used to be.

This bipartisan legislation combines federal dollars with new incentives to help local communities assist families on the brink of becoming homeless. It is a wise investment of federal resources that will save taxpayers money in the long run by preventing homelessness, promoting the development of permanent supportive housing, and optimizing self-sufficiency.

Finally, I wanted to briefly talk about the definition of homelessness.

The HEARTH Act expands the HUD definition of homelessness, which determines eligibility for much of the homeless assistance funding, to include people who will lose their housing in 14 days; any family or individual fleeing or attempting to flee domestic violence, or other dangerous or life threatening situations; and families with children and unaccompanied youth who have experienced a long term period without living independently, have experienced persistent housing instability, and can be expected to continue in such status for an extended period due to a number of enumerated factors, such as a disability.

It also allows grantees to use up to an additional 10 percent of competitive funds to serve families defined as homeless under the Education Department homeless definition, but not so defined under the HUD definition. For areas with low levels of homelessness, up to 100 percent of funds may be used for such purposes.

The HEARTH Act also provides communities with greater flexibility in using funds to prevent and end homelessness. Whether it is the new Emergency Solutions Grant or the new Rural Housing Stability Assistance Program, that would grant rural communities greater discretion in addressing the needs of homeless people or those in the worst housing situations in their communities, this bill allows people to help people who are not technically homeless, and keep them from becoming so.

I recognize there have been tensions on the definition issue. All of us want to be sure that we are providing services to homeless children and families, and those at risk of homelessness.

Our amendment does not change the definition of homelessness in the No Child Left Behind Act for education programs that serve homeless children, nor does it seek in any way to hinder or limit these services.

In fact, our amendment strives to reach an appropriate balance to make sure that there are HUD funds available to help these families.

I hope that my colleagues can join Senator Bond and me, and support this important amendment.

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Mr. REED. Mr. President, I thank the chairman for his kind words and support. I do also recognize Senator Wayne Allard of Colorado. Wayne and I worked together on this legislation for a number of years. In fact, we sort of rotated between subcommittee chairman of the Housing Subcommittee. Consistently and in a very bipartisan fashion, we worked together. We have been joined by Senator Bond whose leadership on the Appropriations Committee is remarkable when it comes to housing issues. We benefited immensely by the contributions of Senators Allard and Bond. I did not have the fortune of knowing Stuart McKinney. I knew him only by reputation. He was known as a sterling man who worked hard when the issue of homelessness was not as central to our consciousness as it is today.

Bruce Vento was extraordinarily decent. These two gentlemen sort of pointed the way. Now we have to take up the task and move it forward and further. I think we can with this legislation.

I thank the chairman for his support and urge all colleagues to join us in support of the amendment.

I suggest the absence of quorum.

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Mr. REED. Madam President, Senator Coburn has been working very diligently over the last several years to deal with the issue of property disposition. We have established over many decades now certain priorities to access Federal properties, and included in those are very low-priority agencies that provide shelter for homeless people. Prior to these, in my recollection of the distribution of the properties, is the right of State and local governments to buy property at a discounted price.

Madam President, as Governor, you have probably considered this option many times. It is my understanding that this underlying bill would exempt a number of the properties from the Federal Property Act provisions that would allow, in fact, State and local governments to access these properties at prices that are reasonable, particularly now, given the budget pressures of local governments. But, in addition, this 5-year pilot program would encompass the largest and potentially most valuable properties that are held in surplus by the United States.

It is far from a pilot program. What our colleagues in the House are talking about is a true pilot program--a limited number of properties to validate and really legitimize the approach Senator Coburn and others are suggesting. I know the Senator has been working very diligently and sincerely with colleagues on both sides of the aisle, but this represents a version, an early version, I believe, that, at least in terms of discussion with others, has been changed somewhat.

One point I wish to make with respect to the underlying amendment that is important is that we are not attempting to deal with the issue of property distribution, which cuts across the entire spectrum of Federal properties--practically every agency in the Federal Government. That encompasses not only the rights--very limited rights--of homeless groups to acquire property but fundamentally the rights of State and local communities to acquire this property. In fact, for many State and local communities, this program is a major source of economic development.

Again looking at the Chair, who was the Governor of the State of New Hampshire, Pease Air Force Base was surplus property which is now a dynamic economic development tool. My guess, again, was that it was obtained by the State, probably using at least in part some of these powers. All of that would be altered in this pilot program that would give, in fact, public lands managers wide discretion to dispose of properties. Again, it is a pilot program, but it is so long term. Five years is not exactly a short-term, let's do an experiment, evaluate it, and see what can be done.

Our legislation, the underlying amendment, is the result of many years of bipartisan effort to deal with the issue of homelessness, not the distribution or disposition of public property. I think it would represent an extraordinary improvement in the current system. It is more efficient, it consolidates applications, it gives flexibility to local communities, and it deals with the problem that I think is equally compelling for the children of today. There are thousands of children who don't have a home. We have to be cognizant of the future. We have to take prudent steps--and I wish, looking back over the last 8 years, some of my colleagues on this side would have been much more prudent in their fiscal policies that took a surplus in 2001 and turned it into a huge deficit in 2008, 2009. So the ability to look ahead is not exclusive to one side of the aisle. But the legislation I have proposed, along with Senator Bond, represents a reauthorization of McKinney-Vento, which will give the States and localities better tools to deal with the current crisis of countless families who are without homes.

My concern is not only with the breadth of this amendment, with its focus on one part of a much more complicated puzzle, but also the fact that I think it could seriously jeopardize the passage of what is important legislation--the McKinney-Vento reauthorization.

I do believe, because of the Senator's efforts, because of his sincere and energetic and consistent advocacy of this, that this issue is resonating on both sides--both with our colleagues in the House and here in the Senate. I would be extraordinarily disappointed if we were to miss a great opportunity to fundamentally reform the program.

We worked with the Senator last Congress. We had bipartisan support, led by Senator Allard. We had, in fact, the clear endorsement of President Bush and the Housing and Urban Development Department under the Bush administration for our homelessness proposal, but it failed because this legislation, the Reed amendment, was embroiled in this controversy of property disposition which spans every agency of the Federal Government. It is not just HUD, it is the Department of Defense, the Department of Agriculture, the Department of the Interior.

I think if we are going to do something this comprehensive, let's not single out the homelessness initiative as sort of the wedge or the fulcrum or the lever. Let's step back, work collectively, collaboratively, and pass legislation that will apply across the board and will do so in a principled and practical way. There is no opposition to that.

I would also note, as the Senator alluded to, that at an appropriate moment there will be a point of order raised on the legislation. But I would hope that, again, we could move through this proposed second degree, pass the underlying amendment, and not forget but in fact redouble our efforts to approach this in a comprehensive way. I know many colleagues--not only Senator Coburn but Senator Carper--are sincerely and enthusiastically interested in having reform of the way we dispose of property.

I am certainly also in a position to say personally that I think if we do
this, we have to take into consideration the equities of all the parties. This is not just about homeless groups that get grants, this is about State and local governments, this is about the way we have established over many years the disposition of Federal property. Can it be improved? Yes, it can. Should we improve it? Yes, we should. But I think to essentially target the homeless population as sort of the lever for this change is the wrong approach. So I would, at the appropriate moment, either myself or the manager, raise a point of order.

With that, I yield the floor.

Madam President, I do have another amendment which I would like to call up, but I see the Senator from Oklahoma is here, and he should have an opportunity to speak.

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Mr. REED. Madam President, there will be an amendment that I propose that will help qualify the status of warrants that are currently held by the Department of Treasury with respect to TARP. It will give the Secretary of the Treasury discretion to dispose of those warrants when he feels it is appropriate. Right now, under language that was adopted in the context of our debates over the recent amendments to TARP, there is a mandatory requirement for the Secretary to surrender or dispose of the warrants if the TARP funds are returned by a financial institution.

I believe the Secretary should have the discretion to hold these warrants if he thinks it is in the best interests of the taxpayers. The whole point of the warrants, and a point I insisted upon in the original legislation for the TARP bill last September, indeed a point that I found to resonate with many of our colleagues on the Republican side--SPENCER BACHUS, the ranking Republican on the House Financial Affairs Committee cited this specifically as one of the reasons why the TARP program could be supported--and that is, in addition to our investment in preferred stock which pays dividends, the Government would also have the right to obtain warrants; that would be the right to acquire stock in the future.

Interestingly enough, at the time we were debating the TARP bill, Warren Buffett, who was a very sophisticated and is a very sophisticated investor, made a preferred stock investment in a large financial institution and also received warrants. So this is typically how many of these deals are done.

At this juncture the institutions receiving TARP funds have the right at any time to pay it back. That is an issue that has been settled. It is the policy of the United States. But I believe the Secretary of the Treasury should have the discretion, because these are separate instruments, to hold those warrants, to maximize, if he can, the market price that he will receive on behalf of the taxpayers.

This, again, is an issue that was very critical to many of us in the initial adoption of the TARP legislation. We are not mandating that the Secretary of the Treasury surrender the warrants, nor are we mandating that he keep them. It will be discretionary. He and his colleagues have, and I believe must exercise, the judgment when it is an appropriate time to surrender these warrants or to take other actions under the contracts under which they were issued, to ensure value for taxpayers.

We have made very significant investments in the financial system through the TARP program. The premise, again, was that not only would the direct investment be repaid, but taxpayers would benefit from the recovery of these institutions. We are seeing that recovery now. We have a ways to go but we are seeing some encouraging signs. I believe, again, that having assumed risks, taxpayers should benefit from the rewards of a revived
financial institution and in that case we are simply making this discretionary with the Secretary of the Treasury so that he can judge whether and when the appropriate time is to surrender the warrants, to receive fair market price for the warrants, and to ultimately help benefit the taxpayers who have put up the money to deal with a huge financial crisis.

At the appropriate time I believe there will be a consent to move forward on this amendment. I hope it would be supported and adopted, but I wanted to make that point at this juncture.

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