Paul Sarbanes

Mr. SARBANES

Mr. SARBANES. Mr. President, I rise in strong support of the Legal Services Program and in opposition to the pending appropriation bill. Pursuant to this legislation, and the Legal Services Program--as it has existed for more than two decades--would be abolished and replaced with a legal assistance block grant program, funded at a level that is drastically less than current funding for legal services. The Legal Services Corporation has been at the forefront of our efforts to give real meaning to the words emblazoned in stone above the portals of the Supreme Court: ``Equal Justice Under Law.'' The Legal Services Program has provided critically needed services to millions of poor, elderly, and disabled citizens who otherwise would not have access to the American legal system and the protection its affords the many basic rights we enjoy in this country and which so many of us take for granted. The Legal Services Corporation provides funds to State legal aid programs throughout our Nation. It has been described as one of the most effective and worthwhile Federal programs in existence, while also being one of the least costly. Legal Services programs provided needed legal assistance to approximately 1.7 million clients annually, benefiting about 5 million individuals living in poverty in this country, primarily women and children. LSC accomplishes this using only about 3 percent of its total funding for administration and management. That means that 97 percent of the appropriation goes directly to the local programs that provide the services, clearly illustrating the efficient operation of this valuable program. Maryland's Legal Aid Bureau, which receives by far the largest portion of its total funding from the Legal Services Corporation, has done an outstanding job of representing Maryland citizens living in poverty. With the funding received from LSC, the 13 legal aid offices located throughout Maryland provide general legal services to approximately 19,000 families and individuals annually, assisting Marylanders in such routine legal matters as consumer problems, housing issues, domestic and family cases, and applying for and appealing the denial of public benefits. Because the Republican measure proposes that grants be made to individual attorneys, and appears to exclude current legal services programs from eligibility for funding under the program, the Maryland Legal Aid Bureau could lose some of even all of this critical Federal funding. This would leave Maryland Legal Aid unable to provide these vital services to the many thousands of clients currently represented-- who, in fact, represent only a small percentage of Maryland's poor citizens--unless alternative funding can be provided at the State and local level. Mr. President, the Legal Services Corporation has operated an effective and efficient program in representing citizens, who without this assistance, would never have their day in court. Although most of the cases involve routine legal disagreements related to housing, consumer issues, family and domestic matters, and employment, these routine matters often become insurmountable when coupled with the other pressures of a complex society that weigh on a family unable to afford legal representation. The Republican proposal would replace the Legal Services Corporation with a block grant program administered by the Department of Justice, through which funds for civil legal assistance would be allocated to the States. The bill severely reduces funding for legal services, cutting the funding from the $400 million appropriated to the Legal Services Corporation for fiscal year 1995 to $210 million--a reduction of nearly 50 percent. Not only does the bill slash funding for legal services for the poor, it also establishes severe restrictions on the type of services that may be provided under the new block grant program. This program would drastically limit qualified services to 10 specific causes of action. As a result, low-income individuals would be denied representation with respect to numerous critical--and basic--legal matters. Under the measure, qualified services appear to exclude representation in essential legal matters such as applying for or appealing a denial of statutory benefits, including Social Security benefits, veterans benefits, unemployment compensation, food stamps or medical assistance; obtaining or refinancing home ownership; housing discrimination; claims based on consumer fraud or defective products; discrimination in hiring; wage claims; problems with public utilities; immigration; unfair sales practices; preparation of wills; paternity; and patient rights. Most of these excluded causes of action represent legal matters that routinely arise out of everyday problems faced by many Americans. Under the committee bill, legal assistance with respect to these routine types of cases would be denied arbitrarily to low-income individuals and families. Additional restrictions would prohibit legal service providers from using funds under the program for representation in cases related to matters such as redistricting, legislative and administrative advocacy, and prison litigation. Class action lawsuits against the Government or private parties--which, contrary to the myth currently being perpetuated, actually encompass less than one-tenth of 1 percent of all legal services cases--would be barred, as would lawsuits challenging the constitutionality of any statute. Another particularly disturbing provision in the bill would require that any qualified client, as a condition for receiving services under the program, waive the attorney-client privilege and the attorney work product privilege. This clearly interferes with the ethical obligations that all lawyers have to their clients. Mr. President, the drastic cutbacks and restrictions in this bill would strike a devastating blow to many of our citizens who would find access to the courts blocked and would be unable to assert the rights to which they are entitled by our Constitution and our laws. I strongly urge my colleagues to oppose these attempts to dismantle this vital program and to support the continuation of the Legal Services Corporation and the current legal services delivery system, as well as increased funding for legal assistance for the poor over the level proposed in this appropriation measure. [[Page S 14539]] An editorial appearing in the September 15 New York Times eloquently addressed the current Republican attack on funding legal services for the poor and the importance of maintaining the Legal Services Corporation. I ask unanimous consent that this editorial be printed in the Record.

Mr. SARBANES

Mr. SARBANES. Mr. President, I rise in support of H.R. 2399, the Truth in Lending Act Amendments of 1995. This bill represents a solution to the so-called Rodash problem. I would like to begin by commending the chairman of the Senate Banking Committee, Senator D'Amato, the chairman and ranking member of the House Banking Committee, Representative Leach, Representative Gonzalez, Representative McCollum, and Representative Vento for their cooperation in working out a bipartisan resolution of this problem. In my view, it responds to legitimate concerns raised by the financial industry but preserves the basic consumer protections of the Truth in Lending Act. The Rodash problem arose from a court decision last year in which small violations of the disclosure requirements of the Truth in Lending Act triggered the right of rescission provided by the act. That decision, in turn, resulted in the filing of class action lawsuits against creditors for small violations of the disclosure requirements. The Congress placed a moratorium on such lawsuits in order to provide time to sort out this issue and clarify the statute. The moratorium expires on October 1. It is therefore important for the Congress to act expeditiously on a permanent solution to the Rodash problem. The House Banking Committee included a response to the Rodash problem in a larger banking bill reported out of the committee earlier this year. That bill, in my view, went beyond fixing the Rodash problem. If passed, it would have weakened the Truth in Lending Act and undermined critical consumer protections. In order to enact a solution to the Rodash problem before the moratorium expires, agreement was reached to try to move the Rodash package as a separate bill. Negotiations were undertaken between the House and Senate, and a compromise was reached which is contained in H.R. 2399. The House passed H.R. 2399 on Wednesday by unanimous consent. The Senate will do so today. The bill before the Senate today improves significantly the measure passed by the House Banking Committee. Under the original House bill, consumers would have lost the right of rescission for a whole class of loans even if the most egregious violations of the Truth in Lending Act were committed. The bill before the Senate preserves that vital consumer protection. The original House bill also would have eliminated, for an entire class of mortgage loans, the borrower's right to a 3-day cooling off period after closing on a loan. The bill before the Senate retains that cooling off period. Moreover, the bill before the Senate protects the most vulnerable citizens from abusive lenders. It provides consumers with truth in lending protections when faced with foreclosure. This bill will help many elderly people keep their homes. This bill increases the tolerance for statutory damages, lifting the bar that determines what constitutes a violation. This bill does not increase the tolerance as much as the original House bill. This is important because a low tolerance is needed to ensure that consumers are receiving accurate information about the cost of credit. This increased tolerance for errors is intended to protect lenders from the small errors in judgment that occurred in the Rodash case. It is obviously not intended to give lenders the right to pad fees up to the tolerance limit of $100. For example, if a delivery associated with the closing cost on a home mortgage costs $30, $30 should be charged and disclosed as part of the finance charge. A lender cannot arbitrarily raise the charge an additional $70 simply because there is a wider tolerance. The purpose of the Truth in Lending Act is to require disclosure to consumers of the cost of their credit. An outstanding problem remains that there are too many exclusions and exemptions that blur the bottom line. The [[Page S 14568]] bill directs the Federal Reserve to report to Congress and develop regulations to ensure that all charges related to the extension of credit are included in the finance charges. Lenders and consumers agree that it is important to alleviate confusion over the treatment of fees in the finance charge. The Federal Reserve has 1 year to develop these regulations. The bill specifically exempts certain charges from the finance charge, including third party fees, taxes on security instruments, fees for preparations of loan documents, and fees relating to pest infestations. The purpose of the exemptions is to provide some clarity on the treatment of those fees until the Fed acts to ensure that the finance charge definition more accurately reflects the cost of providing credit. The fact that these exemptions are included does not create a presumption or requirement for the Fed to exclude them from the definition of finance charges. The Fed should include all charges in the finance charge unless those charges are not related to the extension of credit. I look forward to the Federal Reserve's action and I am hopeful this will lead to simpler and more common sense disclosure. Mr. President, I am pleased that a reasonable agreement, embodied in H.R. 2399, has been reached to address the Rodash problem. I urge my colleagues to support this bill.

Mr. SARBANES

Mr. SARBANES. Mr. President, in closing, let me just underscore that I would prefer that we not take the money out of the section 8 reserves. But we are forced by the budget rules to find an offset. The question before us here is, amongst the priorities, which activities ought to come first? The homeless are at the very bottom of the scale. They are out on the street. We have been trying to put together an infrastructure to try to deal with their needs and we are having some success across the country. Each of you know that in your local communities you have church groups, you have civic organizations, you have community groups who are marshaling their resources to try to deal with the needs of the homeless. They need this Federal support. The Appropriations Committee has written that the homeless assistance programs would have to get back above $1 billion in order to justify a formula approach. In the Banking Committee last year, we included a formula approach to homeless assistance that was supported unanimously in the committee. That is where we want to get. The funding in this amendment gives us a chance to get there. The funding in this amendment also gives the chairman of the committee something to work with in the conference. The House is 40 percent below last year's figure. The current Senate figure represents a 32-percent cut. If the Senate goes to conference on that basis, you know the final outcome is going to be somewhere in between. If the Senate bill is allowed to stand, you are going to have a cut of 35 to 40 percent in the funding for the homeless when this bill comes back from conference. The amendment before you today will enable the chairman to work in conference in order to provide adequate resources to deal with this pressing national issue. I am simply saying to my colleagues, support this amendment: Vote to shift some of this money from section 8 reserves to the homeless programs. I am not happy with doing it, but we think we can handle the section 8 renewal needs out of existing resources and the Secretary has indicated as much in his letter to us. The additional resources for the homeless in this amendment will give us a chance to put a new approach into effect.

Mr. SARBANES. Mr. President, 5 on each side?

Mr. SARBANES. Mr. President, could I inquire of the parliamentary situation, the time situation?

Mr. SARBANES. Mr. President, I yield myself 2 minutes. Mr. President, I implore my colleagues to support this amendment on the homeless. The committee has cut the money for homeless assistance by 32 percent from last year's level. In fact, the committee level is below the level of the year before last. The House has cut homeless assistance by 40 percent. If we fail to adopt this amendment, our conferees will be working with a figure of 32 percent below last year-- a cut of $360 million. The House has a cut of $444 million below last year. If we pass this amendment, we will give our conferees an opportunity in conference to do something about the homeless. We are making progress in our fight against homelessness and this amendment will advance that cause. This proposal would bring homeless funding [[Page S 14344]] back to last year's level--$1.1 billion. The Appropriations Committee said in its report that ``The committee is worried that the block grant approach with funds less than $1 billion may disadvantage some areas with significant homeless populations and some homeless providers.'' This amendment will bring homeless funding back above the $1 billion level so we can move to a formula grant. A formula grant will make it possible for the States, the localities, the churches, the social service agencies, the civic organizations, and the nonprofit groups to work collectively in a more constructive and positive fashion to resolve the problem of the homeless. The offset for this amendment comes out of the funds for the renewal of expiring section 8 contracts. The reduction in renewal resources is made possible by a provision in this amendment that allows the Secretary to require housing agencies to use section 8 reserves to renew their expiring contracts. The HUD Secretary has written to us that this offset would not create a problem in renewing expiring contracts. He writes, ``Funding for renewal of expiring contracts can be reduced without any impact on existing recipients.'' The act that encompasses our homeless assistance programs is named after Stewart McKinney--the distinguished former Republican Congressman from Connecticut. Ever since Congressman McKinney's efforts to develop the homeless assistance programs, Federal policies for homeless assistance have enjoyed bipartisan support. I urge my colleagues to continue this bipartisan approach here today. How much time is remaining?

Mr. SARBANES. I yield myself 30 seconds, if the Chair will remind me. Mrs. Lucie McKinney--the widow of the very distinguished former Republican Congressman--wrote an article a couple of weeks ago about the programs that help the homeless. Let me just quote the end of that article. She wrote: We do know how to end homelessness. While the cure is not cost-free, it costs a whole lot less than not facing and solving the problem. Saving lives and saving money--how can that be bad? I urge my colleagues to support this amendment.

Mr. SARBANES. I yield 1 minute to the Senator from Illinois.

Mr. SARBANES. Mr. President, will the Senator withhold the tabling motion as he did on the Baucus amendment, and allow an up-or-down vote?

Mr. SARBANES

Mr. SARBANES. I very much appreciate the support of my colleague and her leadership on this bill. The appropriations subcommittee has been given an allocation which is completely inadequate to meet the funding needs of the programs under her jurisdiction. I know how hard she struggled with that. Mr. President, let me make this point: State and local governments, nonprofit groups, church groups, and community groups have all joined in a network to try to address the problems of the homeless. They are working at the local level to create comprehensive systems on behalf of the homeless, systems that outreach and screening, emergency shelters, transitional facilities, and permanent housing with services where that is necessary. Supportive housing is the approach to meeting the needs of the homeless about which Mrs. McKinney wrote in her article. Our approach to addressing the needs of the homeless is beginning to work. This is not the time for the Federal Government to back away from its commitment. I implore my colleague from Missouri to accept this amendment. This amendment makes good sense. We are weighing the decision between dealing with the homeless, as this amendment seeks to do, and leaving those moneys in a section 8 reserve account. I do not think that it is even a close call. We have to try to deal with the homeless problem. We ought not to recede from the fight when we are finally realizing some success. I reserve the remainder of my time.

Mr. SARBANES. Will the Senator withhold the tabling motion, because it is just not correct to say it cannot be allocated. It can be allocated.

Mr. SARBANES. It has already been agreed to.

Mr. SARBANES. Mr. President, am I correct that we have 30 minutes on this side and 30 minutes for the manager of the bill?

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

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

Mr. SARBANES. Will the Senator yield?

Mr. SARBANES. I object. Is there time remaining on this side?

Mr. SARBANES. Will the Senator yield me 30 seconds?

Mr. SARBANES. There is time on the other side.

Mr. SARBANES. Has the tabling motion been made?

Mr. SARBANES. Mr. President, I yield myself 5 minutes and ask the Chair to inform me when that time has been utilized.

Mr. SARBANES. Mr. President, I very much hope that Members will perceive this amendment in a way that will enable us to adopt it. In fact, I hope the manager of the bill will accept it, after we discuss it a bit. What this amendment does is restore $360 million for homeless assistance funding. It brings the funding for the homeless back to the 1995 level of $1,120,000,000. The bill reported from the Appropriations Committee has a figure of $760,000,000. That is a cut of $360 million-- a cut of 32 percent from the 1995 funding level--the largest percentage funding cut of any of HUD's formula-driven programs. Homeless assistance programs are a critical part of the safety net.

Mr. SARBANES. The homeless assistance programs are a critical part of the safety net. The safety net is being badly shredded. I certainly hope it would not happen to the programs that really deal with the people who are out on the street--people who are out on the street without a place to stay. The offset for this additional money would take funds out of section 8 program reserves. Housing authorities that have expiring section 8 contracts have money available to them. In the past, the authorities have been able to roll the reserves over. This amendment would utilize those funds for section 8 renewals. In the past, the public housing authorities have used the reserves to augment the section 8 program. I regret using section 8 as an offset because I think the section 8 program is also very important. But, in deciding between these two choices, it seems to me we have to pay more attention to the pressing problem of the homeless. The Secretary of HUD has sent a letter indicating that the expiring section 8 contracts could be renewed by the money provided in the bill--even after this offset--even after the utilization of the $360 million--in order to bring the funding for the homeless up to this year's level. Let me very quickly cover the importance of passing this amendment. On September 11, there appeared an excellent article in the Washington Post by Lucie McKinney, the widow of Stewart McKinney, Republican Member of the House of Representatives from the State of Connecticut. Representative McKinney was a very able and distinguished Member of the Congress who took a very keen interest in the problems of the homeless. In fact, the McKinney Act programs are named after him. That act includes the range of homeless programs addressed by this amendment. Ms. McKinney points out, ``I'm stunned that Congress, which has proclaimed its commitment to finding and funding plans that actually work, would allow these cuts to stand.'' She is talking about the cuts to the homeless programs. She goes on to cite two studies which conclusively demonstrate that the supportive housing dimension of the homeless program is working exceedingly well. As she notes, ``* * * cuts, far from saving money, will waste it.'' She goes on to say, ``Put simply, not housing our most vulnerable Americans costs millions more than housing them. It's just common sense.'' And she concludes this article: ``* * * we do know how to end homelessness. And while the cure is not cost-free, it costs a whole lot less than not facing--and solving--the problem. Saving lives and saving money--how can that be bad?'' Increasing the homeless funding back up to the 1995 levels will provide an opportunity to reform how the homeless assistance programs are administered. The most notable feature of the reform effort is the push to convert the existing collection of seven categorical grant programs at HUD into a single program delivered by formula to State and local governments.

Mr. SARBANES

Mr. SARBANES. Mr. President, I simply want to address the argument by my colleague that passing this amendment will not serve a purpose. The amendment will, in effect, enable HUD to implement a formula approach with respect to the homeless problems in the coming year. HUD could structure the formula approach so that State and local governments, the homeless assistance providers, the church groups, and the community groups could come in and anticipate their expected level of funding off a $1.1 billion figure. The Appropriations Committee itself has said they have to have more than $1 billion in order to make the formula approach work. They are going to negotiate regulations. That will take a good part of the fiscal year. The end result of all of this is a greater commitment to dealing with the homeless. I concede that we are taking money from the section 8 program. I think in the order of priorities, addressing the homeless ought to come ahead of that. Then people say, well, the following fiscal year the amount needed for section 8 is going to double from $4 billion to $8 billion. If it is that order of magnitude you will need an entirely new solution. You will not solve it by this $360 million here that is being held in the reserve. This money, though, could make an enormous difference with respect to addressing the homeless problem. Therefore, I very strongly renew my support of the amendment.

Mr. SARBANES. Mr. President, the appropriations bill before us today represents a major step backward for the environment. While less extreme than the House-passed measure, it still proposes to cut EPA's budget by $1.7 billion--fully 23 percent below the levels enacted in fiscal 1995--and contains 11 so-called riders which would significantly undermine the Environmental Protection Agency's ability to administer and enforce environmental laws and perform its important mission of protecting public health and the environment. Maryland alone would lose over $14 million in funding needed to upgrade outdated sewage treatment facilities--projects which have a direct impact on the water quality of the Chesapeake Bay, our coastal beaches and bays, and local waters. Legislative provisions in the underlying measure would prohibit EPA from implementing section 404(c) of the Clean Water Act which gives the agency authority to review U.S. Army Corps of Engineers wetlands permit decisions and provides another system of checks and balances in protecting the quality of our Nation's waters. In addition, the proposed cut of some $20 million in EPA's enforcement and compliance assurance program would severely impact upon the agency's ability to inspect industrial and Federal facilities in Maryland and prosecute violations. Mr. President, this bill unfairly singles out EPA to bear a disproportionate share of the deficit reduction burden. It will not just decrease the rate of increases, but will severely cut EPA's funding. Its riders would undercut a number of our Nation's environmental statutes, without adequate hearings, public involvement or review. These actions are unjustified and unwarranted and for these and other reasons, I urge my colleagues to join me in rejecting this bill.