Kit Bond

Mr. BOND

Mr. BOND. Mr. President, if there is no further business to come before the Senate, I now ask that the Senate stand in adjournment under the previous order.

Mr. BOND

Mr. BOND. Mr. President, we have been open for business for 3\1/2\ hours today. We have handled some routine matters and had a very good discussion on mark to market. We would like to know if there are any other Members who have anything they wish to act on this afternoon. We have major amendments that will have to be debated tomorrow. We certainly hope that we can conclude this bill sometime between the resolutions or actions on the situation in Iraq and the Defense of Marriage Act. I hope that the very important programs that are covered by VA, HUD, and independent agencies bill will be given full consideration. If there are any other amendments or actions today, I ask that they be brought forward. I yield the floor and ask my colleague if she has any further comments.

Mr. BOND. Mr. President, I have been advised by floor staff that there will be a briefing on the situation in Iraq tomorrow afternoon. I believe leadership is working to get a very short time agreement on a resolution. We have had indications that the Senators involved in the Bion amendment for NASA would be willing to accept a 2-hour time agreement. Is it possible to get a time agreement from, say, 9:30 to 11:30 tomorrow morning, with a vote at 11:30 on or in relation to the NASA Bion amendment? I pose that question to my colleague for further discussion with the leadership on the minority side.

Mr. BOND. Mr. President, I thank my colleague. It was the intent, I believe, of the majority leader to move--or it was hoped that we could move forward on the Bion amendment and have a vote at 11:30. It appears that this has been raised to a higher pay grade than ours. So it cannot be resolved at this time.

Mr. BOND. Mr. President, I don't think anybody is particularly concerned about what time we have votes, so long as we can reach an agreement. On behalf of the majority leader, and really on behalf of those of us who worked on this bill, I hope we will be able to come up with an orderly procedure, get agreements on the order in which we will bring up these very important amendments, when we can get a resolution, get a time agreement, and get final passage. For my part, we are ready. We have been ready since early August to go forward with this. We have very difficult and constructive disagreements to work out with the House over this measure so we can get it passed. We really want to move forward on it as quickly as possible. So all things are negotiable. I hope we can get an orderly procedure and handle these amendments, which will require some good debate, and get them done tomorrow as quickly as possible.

Mr. BOND. I thank the Senator from Maryland. We can have debate on the space station all night tonight, as far as I am concerned. For those who wish to debate a new entitlement program, that could go on as long as we want tonight. This facility is not being used otherwise. I hope that when we get ready to begin voting tomorrow, we will be able to have votes in a timely fashion. At this point, the floor staff is checking with the leadership. I suggest the absence of a quorum.

Mr. BOND. Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. BOND

Mr. BOND. Mr. President, I send an amendment to the desk.

Mr. BOND. I am delighted to have the good Senator from Maryland working with me on this. I enjoy working with the Senator from Arkansas on small business. Mr. President, turning to some of the procedural matters, I ask unanimous consent that the amendments of the committee to H.R. 3666 be considered and adopted, en bloc, with the proviso that no points of order are to be waived thereon by such adoption, and that the bill, as amended, be considered original text for the purpose of further amendment, with the further proviso that this consent request exclude the following amendments: On page 72, line 10, relating to an earmark for drinking water funds; page 85, lines 6 through 15, relating to NASA buyouts; page 102, line 23, through page 104, line 20, relating to FHA; page 104, lines 21 through 24, relating to NASA's Bion mission.

Mr. BOND. Mr. President, I send an amendment to the desk and ask for its immediate consideration.

Mr. BOND. Mr. President, I ask unanimous consent that reading of the amendment be dispensed with.

Mr. BOND. Mr. President, this is an amendment to the first excepted committee amendment. It increases the amount provided for drinking water State revolving funds by $725 million in recognition of the fact that, on August 1, 1996, funds previously appropriated for drinking water State revolving funds were reallocated to clean water State revolving funds pursuant to a requirement in the fiscal year 1996 omnibus appropriations bill. Congress mandated this transfer if a drinking water authorization bill had not been enacted into law as of that date. That measure was enacted less than 1 week after the August 1 deadline, and we believe it is appropriate that these funds be restored. The funds which have been released for clean water revolving funds can be considered as an advance on the fiscal year 1997 appropriation. This amendment simply adjusts the new appropriations to reflect this prior funding and will have no effect on our intended program levels. We gave our assurances to members of the authorizing committee that this would be one of the first orders of business as we dealt with this bill. The members of the committee worked so hard for the passage of the safe drinking water measure. We are very anxious to have these funds available, and the funds under this amendment will be available crediting the transfer of the funds on August 1 to the clean water revolving fund account for 1997 and giving the 1996 appropriations along with the 1997 appropriations to drinking water.

Mr. BOND. Mr. President, I move to reconsider the vote by which the amendment was agreed to.

Mr. BOND. Mr. President, I move to reconsider the vote by which the amendment was agreed to.

Mr. BOND. Mr. President, this is a perfecting amendment to the next excepted committee amendment. The modification proposed is necessary to clarify the intent of the committee that the buyout authority granted for NASA be conducted entirely with the appropriated funds. The modification requires NASA to reimburse the civil service retirement disability fund for the full cost of anticipated retirement benefits and lost contributions associated with employees who accept these incentives and retire voluntarily to separate from Federal service. By requiring such payments, we prevent an increase in expenditures occurring during fiscal year 1997 as a result of the buyout since NASA will have to use other expenditures in order to meet these costs.

Mr. BOND. Mr. President, I thank my distinguished ranking member for a very forceful presentation. I tell her that I share that desire for a final vote tomorrow very strongly. I endorse and second all of the strong things she said about the science function. She knows and understands these programs extremely well. That is why she is an invaluable member of this subcommittee. I certainly would hate to lose her from this subcommittee to Small Business, as has been suggested in other quarters.

Mr. BOND

Mr. BOND. Mr. President, I now ask unanimous consent that there be a period for the transaction of morning business with Senators permitted to speak for up to 5 minutes each.

Mr. BOND

Mr. BOND. Mr. President, I submit a report of the committee of conference on H.R. 3754 and ask for its immediate consideration.

Mr. BOND. Mr. President, I ask unanimous consent that the conference report be agreed to, the motion to reconsider be laid upon the table, and that any statements relating to the conference report be placed in the Record at this point.

Mr. BOND

Mr. BOND. Mr. President, for the information of all Members, there is a pending committee amendment to the VA-HUD appropriations bill that we are hoping to reach a time agreement on which would allow for a rollcall vote perhaps tomorrow morning prior to the Senate recessing for the weekly policy conferences. We hope that we can adopt a timeframe and time agreements on these measures. We also expect that on Wednesday the Senate will take action on a resolution in regard to the situation in Iraq. Rollcall votes are therefore expected throughout the day, and it is hoped that any Senators intending to offer an amendment to the pending bill will be available tomorrow so that we may complete action on this appropriations bill as early as possible tomorrow.

Mr. BOND

Mr. BOND. Mr. President, I ask unanimous consent that when the Senate completes its business today it stand in adjournment until the hour of 9:30 a.m. on Wednesday, September 4; further, that immediately following the prayer the Journal of proceedings be deemed approved to date, the morning hour be deemed to have expired, and the time for the two leaders be reserved for their use later in the day, and that the Senate immediately resume consideration of H.R. 3666, the VA-HUD appropriations bill; and, further, that the Senate recess between the hours of 12:30 p.m. and 2:15 p.m. for the weekly policy conferences to meet.

Mr. BOND

Mr. BOND. Mr. President, I stand in strong support of the Multifamily Assisted Housing Reform and Affordability Act of 1996. This bill goes a long way toward developing a constructive and comprehensive section 8 mark-to-market contract renewal program for reducing the costs of expiring project-based section 8 contracts, limiting the financial exposure of the FHA multifamily housing insurance fund for FHA-insured section 8 projects, and preserving, to the maximum extent possible, the section 8 project-based housing stock for very-low- and low-income families. I congratulate Senators D'Amato, Mack, and Bennett for their contribution and commitment to this comprehensive legislation, as well as their commitment to finding a bipartisan approach to the many difficult issues associated with the renewal of over subsidized section 8 project-based contracts. This legislation is a meaningful step in developing a reasonable policy toward the concerns raised by these expiring section 8 project-based contracts. Over the last 25 years, a number of HUD programs were established for the construction of affordable, low-income housing by providing FHA mortgage insurance while financing the cost of the housing through section 8 project-based housing assistance. Currently, there are some 8,500 projects with almost 1 million units that are both FHA-insured and whose debt service is almost totally dependent on rental assistance payments made under section 8 project-based contracts. Most of these projects serve very-low-income families, with approximately 37 percent of the stock serving elderly families. The crisis facing this housing stock is that the section 8 project- based housing assistance was initially budgeted and appropriated through 15- and 20-year section 8 project-based contracts that are now expiring and for which contract renewal is prohibitively expensive. For example, at least 75 percent of this housing stock have rents that exceed the fair market rent of the local area. Since current law prohibits HUD from renewing these section 8 contracts at rents above 100 percent of the fair market rent, with some exceptions not to exceed 120 percent, in many cases, the failure to renew expiring section 8 project-based contracts at existing rents will leave owners without the financial ability to pay the mortgage debt on these projects. This means that owners likely will default on their FHA-insured mortgage liabilities, resulting in FHA mortgage insurance claims and foreclosures. HUD would then own and be responsible for managing these low-income multifamily housing projects. This bill is intended to avoid this potential crisis through a fiscally responsible and housing sensitive strategy. In addition, the cost of the section 8 contracts on these projects reemphasizes the difficult budget and appropriation issues facing the Congress. In particular, according to HUD estimates, the cost of all section 8 contract renewals, both tenant-based and project-based, will require appropriations of about $4.3 billion in fiscal year 1997, $10 billion in fiscal year 1998, and over $16 billion in fiscal year 2000. In addition, the cost of renewing the section 8 project-based contracts will grow from $1.2 billion in fiscal year 1997 to almost $4 billion in fiscal year 2000, and to some $8 billion in 10 years. Since the HUD appropriations account cannot sustain these exploding costs, this legislation is intended to be a comprehensive response which will reduce the financial cost and exposure to the Federal Government and preserve this valuable housing resource. The Senate bill would generally preserve this low-income housing by using various tools to restructure these multifamily housing mortgages to the market value of the housing with resulting reductions in section 8 costs. I also am troubled by some of the other section 8 mark-to-market proposals being promoted, including the position taken by HUD which, in general, opposes preserving this housing as FHA-insured or as assisted through section 8 project-based assistance, including the elderly assisted housing, in favor of vouchers. This position is very questionable, and I emphasize that it is widely opposed by the housing industry and tenant groups and advocates. I highlight the underlying principles of the bill which would authorize the establishing of participating administrative entities [PAE's] which would generally be a public agency, with a first preference that a PAE be a State housing finance agency or, second, a local housing agency. These entities would be contracted by HUD to develop work-out plans in conjunction with owners of FHA-insured projects with expiring, oversubsidized section 8 contracts. Each PAE would develop mortgage restructuring and rental assistance sufficiency plans as workout instruments to reduce the section 8 subsidy needs of projects through mortgage restructuring. The basic tool provided in the draft bill, and the likely key to any successful strategy to preserve this housing, is to authorize the restructuring of the mortgage debt on these oversubsidized section 8 multifamily housing projects. In particular, the bill would allow the restructuring of these high cost mortgages with a new first mortgage reflecting, generally, the market value of a project, and a soft second mortgage held by HUD, with interest at the applicable Federal rate, covering the remainder of the original mortgage debt and payable upon disposition or upon full payment of the first mortgage. This provision will reduce the cost of section 8 assistance and minimize any loss to the FHA multifamily insurance fund. In addition, this approach ensures that there is no taxable event by virtue of the mortgage restructuring. I also think it would be beneficial to look at some kind of exit tax relief to encourage owners, especially limited partners, to divest their interest in these properties, to encourage new investment in and revitalization of these properties. Nevertheless, I am convinced that the tax committees are unlikely to take up this issue during this Congress and that any discussion on tax relief will have to wait for another time. Finally, I emphasize that it is time to act now. I am currently sponsoring a section 8 mark-to-market demonstration to be included in the VA-HUD fiscal year 1997 appropriations bill which is similar to the Multifamily Assisted Housing Reform and Affordability Act and which represents an interim approach to the section 8 mark-to-market contract renewal issue. This appropriation language indicates my strong belief that we can no longer afford, as a matter of housing policy and fiscal responsibility, to renew expiring section 8 project-based contracts at the existing, over-market rents. Nevertheless, I strongly prefer that section 8 reform legislation be acted on by the authorizing committees before the end of the fiscal year, with the full benefit of hearings and discussion on these very difficult policy issues. I look forward to working with my colleagues on the legislation and hope that the Housing Subcommittee and Banking Committee can act in an expeditious manner on this measure. I emphasize the need to work together and I look forward to moving this legislation through Congress and onto the desk of the President.

Mr. BOND

Mr. BOND. I agree with the Senator from Massachusetts that we have reached that understanding.

Mr. BOND. Mr. President, I am pleased that the Senate supported overwhelmingly the passage of H.R. 2428, the Bill Emerson Good Samaritan Food Donation Act. This is a tremendous tribute to my good friend and colleague from Missouri, Congressman Bill Emerson, who represented southeast Missouri's Eighth Congressional District for 16 years. Bill Emerson was well known in this body, and certainly to many around this city, and was loved by the people of southeast Missouri. He had a long and distinguished career of service in the U.S. Congress. Bill was especially well known for his work in agriculture and in the fight against hunger, including being an ardent supporter of food distribution programs. One of his legislative priorities this session was a bill that would make it easier for millions of tons of unused food by restaurants, supermarkets, and other private businesses to end up in food pantries and shelters rather than in garbage cans and dumpsters. The Bill Emerson Good Samaritan Food Donation Act is identical to legislation championed by Bill Emerson before his death. In the past, private donors have been reluctant to make contributions to nonprofit organizations because they are concerned about potential civil and criminal liability. With this legislation, private donors will be protected from such liability, except in cases of gross negligence and intentional misconduct. Those in need will truly benefit from this legislation. Again, I am happy to be a part of this commonsense approach to fight hunger, and I appreciate the cooperation of all Members involved in this process.

Mr. BOND

Mr. BOND. Mr. President, I stand in strong support of the Multifamily Assisted Housing Reform and Affordability Act of 1996. This bill goes a long way toward developing a constructive and comprehensive section 8 mark-to-market contract renewal program for reducing the costs of expiring project-based section 8 contracts, limiting the financial exposure of the FHA multifamily housing insurance fund for FHA-insured section 8 projects, and preserving, to the maximum extent possible, the section 8 project-based housing stock for very-low- and low-income families. I congratulate Senators D'Amato, Mack, and Bennett for their contribution and commitment to this comprehensive legislation, as well as their commitment to finding a bipartisan approach to the many difficult issues associated with the renewal of over subsidized section 8 project-based contracts. This legislation is a meaningful step in developing a reasonable policy toward the concerns raised by these expiring section 8 project-based contracts. Over the last 25 years, a number of HUD programs were established for the construction of affordable, low-income housing by providing FHA mortgage insurance while financing the cost of the housing through section 8 project-based housing assistance. Currently, there are some 8,500 projects with almost 1 million units that are both FHA-insured and whose debt service is almost totally dependent on rental assistance payments made under section 8 project-based contracts. Most of these projects serve very-low-income families, with approximately 37 percent of the stock serving elderly families. The crisis facing this housing stock is that the section 8 project- based housing assistance was initially budgeted and appropriated through 15- and 20-year section 8 project-based contracts that are now expiring and for which contract renewal is prohibitively expensive. For example, at least 75 percent of this housing stock have rents that exceed the fair market rent of the local area. Since current law prohibits HUD from renewing these section 8 contracts at rents above 100 percent of the fair market rent, with some exceptions not to exceed 120 percent, in many cases, the failure to renew expiring section 8 project-based contracts at existing rents will leave owners without the financial ability to pay the mortgage debt on these projects. This means that owners likely will default on their FHA-insured mortgage liabilities, resulting in FHA mortgage insurance claims and foreclosures. HUD would then own and be responsible for managing these low-income multifamily housing projects. This bill is intended to avoid this potential crisis through a fiscally responsible and housing sensitive strategy. In addition, the cost of the section 8 contracts on these projects reemphasizes the difficult budget and appropriation issues facing the Congress. In particular, according to HUD estimates, the cost of all section 8 contract renewals, both tenant-based and project-based, will require appropriations of about $4.3 billion in fiscal year 1997, $10 billion in fiscal year 1998, and over $16 billion in fiscal year 2000. In addition, the cost of renewing the section 8 project-based contracts will grow from $1.2 billion in fiscal year 1997 to almost $4 billion in fiscal year 2000, and to some $8 billion in 10 years. Since the HUD appropriations account cannot sustain these exploding costs, this legislation is intended to be a comprehensive response which will reduce the financial cost and exposure to the Federal Government and preserve this valuable housing resource. The Senate bill would generally preserve this low-income housing by using various tools to restructure these multifamily housing mortgages to the market value of the housing with resulting reductions in section 8 costs. I also am troubled by some of the other section 8 mark-to-market proposals being promoted, including the position taken by HUD which, in general, opposes preserving this housing as FHA-insured or as assisted through section 8 project-based assistance, including the elderly assisted housing, in favor of vouchers. This position is very questionable, and I emphasize that it is widely opposed by the housing industry and tenant groups and advocates. I highlight the underlying principles of the bill which would authorize the establishing of participating administrative entities [PAE's] which would generally be a public agency, with a first preference that a PAE be a State housing finance agency or, second, a local housing agency. These entities would be contracted by HUD to develop work-out plans in conjunction with owners of FHA-insured projects with expiring, oversubsidized section 8 contracts. Each PAE would develop mortgage restructuring and rental assistance sufficiency plans as workout instruments to reduce the section 8 subsidy needs of projects through mortgage restructuring. The basic tool provided in the draft bill, and the likely key to any successful strategy to preserve this housing, is to authorize the restructuring of the mortgage debt on these oversubsidized section 8 multifamily housing projects. In particular, the bill would allow the restructuring of these high cost mortgages with a new first mortgage reflecting, generally, the market value of a project, and a soft second mortgage held by HUD, with interest at the applicable Federal rate, covering the remainder of the original mortgage debt and payable upon disposition or upon full payment of the first mortgage. This provision will reduce the cost of section 8 assistance and minimize any loss to the FHA multifamily insurance fund. In addition, this approach ensures that there is no taxable event by virtue of the mortgage restructuring. I also think it would be beneficial to look at some kind of exit tax relief to encourage owners, especially limited partners, to divest their interest in these properties, to encourage new investment in and revitalization of these properties. Nevertheless, I am convinced that the tax committees are unlikely to take up this issue during this Congress and that any discussion on tax relief will have to wait for another time. Finally, I emphasize that it is time to act now. I am currently sponsoring a section 8 mark-to-market demonstration to be included in the VA-HUD fiscal year 1997 appropriations bill which is similar to the Multifamily Assisted Housing Reform and Affordability Act and which represents an interim approach to the section 8 mark-to-market contract renewal issue. This appropriation language indicates my strong belief that we can no longer afford, as a matter of housing policy and fiscal responsibility, to renew expiring section 8 project-based contracts at the existing, over-market rents. Nevertheless, I strongly prefer that section 8 reform legislation be acted on by the authorizing committees before the end of the fiscal year, with the full benefit of hearings and discussion on these very difficult policy issues. I look forward to working with my colleagues on the legislation and hope that the Housing Subcommittee and Banking Committee can act in an expeditious manner on this measure. I emphasize the need to work together and I look forward to moving this legislation through Congress and onto the desk of the President.