Mel Watt

Mr. WATT

Mr. WATT. Mr. Speaker, I was listening to this debate, and the only thing I could be reminded of was a few years ago when I had a very, very serious political campaign mounted against me and that had about $800,000 spent on television ads telling people how terrible I was, and at the end of the campaign, my mother finally called me and said, ``Are you really that bad?'' I don't recognize the bill that's being described here on the floor. Title II and title III we have overwhelmingly passed previously. Title V was overwhelmingly passed out of the Financial Services Committee. And all of the representations that are made about title I seem to me to be just outrageously overstated. Like FHA is going to assume all of this responsibility. This is a bailout. This is a voluntary program. FHA is not out soliciting any of these loans. They will evaluate the credit worthiness of everyone who comes to them. Like this will cost $300 billion. There's no way this program will cost $300 billion unless every single person who gets involved in it defaults and we get nothing out of a foreclosure or reclaiming of the property. Like this is going to benefit speculators. The bill explicitly says that this is limited to homeowners, not people who have been speculators. I don't know what else we could say on that. The language is absolutely explicit that only homeowners qualify for this program. Or maybe like the most outrageous one that I've heard today: Well, the market will take care of this. Well, the market is how we got here in the first place. If the market had been taking care of this, we wouldn't be in this crisis. We wouldn't be having the problem that we are trying to solve. And so this notion that the market is somehow going to overnight correct itself and we will solve this problem solely through market forces just doesn't make a lot of sense to me. But, again, my mother started to question after a while, after people said it over and over and over again. Maybe my colleagues think if they say it enough, that this is terrible, they will convince somebody.

Mr. WATT

Mr. WATT. Madam Speaker, I ask unanimous consent that the Clerk be authorized to make technical corrections in the engrossment of H.R. 2634, to include corrections in spelling, punctuation, section numbering and cross-referencing, and the insertion of appropriate headings.

Mr. WATT

Mr. WATT. Madam Speaker, I rise in support of H. Res. 1095, the resolution recognizing the 40th anniversary of the Fair Housing Act. The Fair Housing Act, title VIII of the Civil Rights Act, was passed by Congress and signed into law by President Lyndon Johnson in April of 1968, only 1 week after the assassination of Reverend Dr. Martin Luther King. This landmark act, the primary purpose of which is to prohibit discrimination in housing, introduced meaningful Federal enforcement mechanisms for buyers and renters. The Federal Housing Act initially prohibited discrimination on the basis of race, color, religion and national origin. Sex was subsequently added to the list of protected classes in 1974, and disability and family status were added in 1988. Forty years later, in 2008, effective and meaningful enforcement of these fair housing laws continues to be critically important. It is essential that we continue to combat housing discrimination, which still exists today, not just by enacting laws, but by enforcing those that we have on the books already. This is a meaningful piece of legislation, and I'm honored to pay tribute to the importance of it, but more importantly, to pay tribute and to recognize that enforcement continues to be a problem, and that discrimination in housing continues to exist. With that, I thank the gentleman for the time.

Mr. WATT

Mr. WATT. Madam Speaker, I rise today to recognize an historic anniversary of the National Crittenton Foundation, which was the first charitable organization created under a congressional charter, and is celebrating 125 years of service. People who recognize the Crittenton name often recall only the maternity homes that were usually hidden and welcomed girls and young women seeking support during their unplanned pregnancies. Much less is known about the influence of the national network of affiliated Crittenton agencies and their lasting impact on the social work profession. The unique relationship between the National Crittenton Foundation and the Crittenton family of agencies is based on the belief that addressing compelling social issues in the United States is best done through a network of independent local agencies supported by a national body. There are now over 23 Crittenton agencies across the country. Together they have provided over 2,200 years of continuous service to 5 million vulnerable girls, young women and their families. Madam Speaker, I ask you and my colleagues to join me in wishing the National Crittenton Foundation and its family of agencies across the country happy anniversary, and our best wishes for another 125 years of success.

Mr. WATT

Mr. WATT. Madam Speaker, I rise today to recognize and pay tribute to Davidson College, President Tom Ross, Coach Bob McKillop, and the Davidson College Wildcats men's basketball team, which had one remarkable basketball season. Davidson College is one of a number of outstanding colleges and universities in my congressional district. The Wildcats basketball team finished its regular season undefeated in the Southern Conference, won the Southern Conference tournament, and went on to their third consecutive NCAA tournament appearance. In the NCAA tournament, Davidson College delivered three stunning upsets, eliminating the Gonzaga Bulldogs, the Georgetown Hoyas, and the Wisconsin Badgers on their way to the Elite Eight. In the Midwest regional finals, the Wildcats gave a tremendous effort before ultimately falling to Kansas by 2 points. Kansas, of course, went on to win the National Championship. By any measure Davidson College was the Cinderella team of this year's NCAA tournament. In a fitting tribute to his coaching and leadership, Coach Bob McKillop received the Coach Clair Bee Award on April 7, honoring the NCAA Division I men's basketball coach who has made the most significant positive contribution to the sport during the year. I wish Coach McKillop and his Cinderella Davidson Wildcats continued success. I am fortunate to represent Davidson College and their outstanding scholars and athletes in Congress. We'll be back next year.

Mr. WATT

Mr. WATT. Mr. Speaker, today, I rise to recognize and pay tribute to the Johnson C. Smith University Golden Bulls men's basketball team which won the Central Intercollegiate Athletic Association basketball tournament held in my congressional district this past weekend. The Lady Golden Bulls, unfortunately, lost to Shaw University in the women's championship game. The CIAA basketball tournament is, of course, the premier basketball tournament in the country among Historically Black Colleges and Universities, dating back years before African American athletes were admitted to and allowed to compete in athletics at other universities throughout the United States. While the tournament highlights the tops in athletic competition and is a source of much needed funding for academic and athletic scholarships, anyone who has ever attended the tournament will know, of course, that it is also an unrivaled social reunion and family event. The outstanding athletic performances by Johnson C. Smith University's teams this weekend, especially the championship performance by the men's team, was one more tribute to Dr. Dorothy Yancey, who has announced that she will be retiring at the end of this school year after 14 years as president of Johnson C. Smith University. Dr. Yancey made history when she became the first female president of Johnson C. Smith University in 1994. Her leadership and hands-on management has led Johnson C. Smith University to many outstanding accomplishments, including two successful accreditation reviews, getting Johnson C. Smith University fully wired, and making it one of the first institutions in the Nation to provide laptop computers to every student; construction, renovation, or restoration of state-of- the-art facilities; and recognition by the U.S. News and World Report magazine as a top tier institution among comprehensive colleges that offer bachelor's degrees for each of the last 6 years. The recent success of Johnson C. Smith University's basketball teams, especially the CIAA's men's championship, is another tribute to Dr. Yancey's leadership as she prepares to retire from Johnson C. Smith. It couldn't have come at a more fitting time. Dr. Yancey's hard work and leadership will forever remain in the hearts of all Johnson C. Smith Golden Bulls and friends. We wish Dr. Yancey and Johnson C. Smith University continuing success. I am fortunate to be the representative of this fine university in Congress.

Mr. WATT

Mr. WATT. I thank the Chair of the subcommittee for moving me up in the order so that I can address some of the misconceptions that we've just heard. I'm holding in my hand a report that was authored, in fact one-third of the report that was authored, by HUD in 1996, about 4 or 5 years into the HOPE VI program. And if we thought that this program was only about demolishing distressed public housing, as my colleague who just spoke would have us believe, we should read the report. It did identify 86,000 severely distressed public housing units that needed to be demolished and replaced in a different kind of setting. It went on to say that we needed to address the needs of the residents. And the commission proposed providing increased funding for supportive services, creating a national system to coordinate social and supportive services to enable residents to become self-sufficient, and devising a system that requires public housing agencies to solicit resident input into the solutions. And the things we have been complaining about, the gentleman is correct, we have been complaining about the HOPE VI program because it has only been about demolishing public housing and not doing any of the services that were originally contemplated by the program. And the amendments in this reauthorization bill are designed to attack those very shortcomings and the original objectives that HOPE VI was designed to accomplish. Number one, not only demolition, but one-for-one replacement is in this bill; input by residents is in this bill; supportive services, increased funding is in this bill. So the gentleman is absolutely correct: those of us who have been complaining about the program acknowledge that it has not accomplished the objectives that were set for the programs by Republicans, not Democrats, to replace and eliminate severely distressed housing and to provide the kind of support that is necessary for residents of public housing to be successful. That's exactly what this bill does, and I encourage support for the bill.

Mr. WATT. Mr. Chairman, I claim the time in opposition to the amendment.

Mr. WATT. Mr. Chairman, I yield myself such time as I may consume. Mr. Chairman, listening to the gentleman, one would think that the demolition-only program is a harmless program in the Federal Government. It is absolutely true that the Bush administration has decided not to use the demolition-only authority that the statute gives them since 2003, but there are reasons that they have decided not to use the demolition-only authority. Between 1996 and 2003, administrations made 285 demolition-only grants to 127 public housing authorities that resulted in demolishing, demolishing, 56,755 housing units, affordable housing units, in this country. And the result was replacing less than half of those demolished housing units because we have had a net loss over that period of 30,000 affordable housing units. So the administration in its good wisdom decided that this was a program that was counterproductive, was contrary in fact to the original objective of the HOPE VI program, and discontinued the use of the authority that it had because it didn't think it was a good program. Now, the case has been made well by a number of our committee members, Mr. Green from Texas in particular, that if there is anybody in America who thinks that there is an excess of affordable housing, they haven't read any statistics. If there is anybody in America who believes there is an excess of affordable public housing, or public housing, period, in America, they haven't read the statistics. So why the Federal Government would be giving money to local communities solely to tear down public housing, affordable housing in this country, given the dire shortage of housing in America and the massive existence of homelessness in America, I can't tell you. Now, HOPE VI allows local communities to demolish distressed public housing; and one of the concerns that this bill addresses is that we have tried to have a program to replace those houses so that people won't be on the street. And that is exactly what HOPE VI does. That part of it we need to retain. The demolition grants need to be terminated. This bill terminates demolition-only grants, and we should support the bill. I reserve the balance of my time.

Mr. WATT. I would just say the gentleman has made the exact point that I tried to make in my argument, probably even more cogently than I made it, that HOPE VI is about not only tearing down but rebuilding. And there is plenty of discretion in local communities inside the HOPE VI program to demolish public housing, as long as there is a plan to put housing back in place. And we have retained that authority to put housing back in place. The bill terminates the authority to just tear down rather than having the obligation to rebuild. I oppose the gentleman's amendment and encourage my colleagues to vote against it. I yield back the balance of my time.

Mr. WATT

Mr. WATT. Let me, first of all, thank the gentlelady for convening this Special Order in memory of our dear friend and colleague, Julia Carson. If you didn't know Julia Carson, you probably would think she was a study in contradictions. That is kind of always the way I felt about her. She was this person that, from the very beginning when she came to Congress, which was the first time I met her, appeared to be a very fragile person. You would see her on the floor and she didn't appear to be well; and yet you would go on a trip to South Africa, and there she would be out among the children meeting with them and undertaking the rigors of an international trip that you knew was an imposition physically on the most physically fit Member of Congress. You would see her and talk to her and her voice would be so mild and gentle, and yet when she undertook an issue, it was just like a metamorphosis because she was so articulate and passionate about that issue. And you would see her and she would look at you sternly and make a quip, and you would walk away thinking it was kind of a straightforward statement. And then all of a sudden it would dawn on you she had zinged you without you even being aware of a subtle point that she had made. There were these contradictions there that I loved about Julia Carson. Once you got to know her, sometimes she would game you, as Barney Frank has indicated. She would appear unsophisticated politically, and then all of a sudden she would pull one of the most important political maneuvers, like the tribute to Rosa Parks that took such delicate balancing to pull the elements together. This was a woman, a lady of contradictions, apparent contradictions, yet once you got to know Julia Carson, you knew there was one person there who was just steady as a rock. She was solid. We loved her and we express our sincere condolences to her family. With that I know there are many who wish to speak, so I yield back.

Mr. WATT

Mr. WATT. Mr. Speaker, I move to suspend the rules and pass the bill (H.R. 4043) to amend the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 to preserve and expand minority depository institutions, and for other purposes, as amended.

Mr. WATT. Mr. Speaker, I ask unanimous consent that all Members may have 5 legislative days within which to revise and extend their remarks on this legislation and to insert extraneous materials thereon.

Mr. WATT. Mr. Speaker, I yield myself such time as I may consume. I submit for the Record a letter dated November 1, 2007, from the National Bankers Association in support of this legislation. National Bankers Association, Washington, DC, November 1, 2007. Hon. Melvin Watt, Chairman, Financial Institutions and Consumer Credit Oversight and Investigations, House of Representatives, Washington, DC. Dear Chairman Watt: On behalf of the National Bankers Association (NBA) (the voice of minority banks since 1927), its board and membership, thank you for taking the time to hold a hearing of the Subcommittee on Government Oversight and Investigations of the Committee on Financial Services on behalf of the nation's women and minority-owned banks. We appreciate your continued support of our banks. We are especially proud that the Financial Services Committee staff invited the National Bankers Association to participate in this important hearing. We support your idea of a joint hearing with the Ways & Means Committee on the CDFI and New Markets Tax Credits Programs. NBA supports the revision of the ``Preserving and Expanding Minority Depository Institutions Act'' H.R. 4043 to include the Office of the Comptroller of the Currency and the Federal Reserve along with the Federal Deposit Insurance Corporation and the Office of Thrift Supervision in the legislation. We also appreciate you taking the time out of your busy schedule every year to participate in NBA's Annual Legislative Summit. Your support has given NBA an elevated level of attention by other congressional members and bank regulators. Again, many thanks. Respectfully submitted, The National Bankers Association Board of Directors: Floyd Weekes, Chairman, Executive Vice President, Citizens Bank, Nashville, TN. James E. Young, Past-Chairman, President & CEO, Citizens Trust Bank, Atlanta, GA. Robert P. Cooper, Chairman-Elect, Senior Counsel, OneUnited Bank, Boston, MA. Tommy Brooks, Treasurer, Executive Vice President & CFO, Unity National Bank, Houston, TX. Cynthia Day, Secretary, Chief Financial Officer, Citizens Trust Bank, Atlanta, GA. Norma Alexander Hart, President, NBA, Washington, DC. Mark Ronan, Corporate Advisory Board Chairman, Director of Banking Relations, American Express Company, NY. Sidney King, Regional Vice Chairman, President & CEO, Commonwealth National Bank, Mobile, AL. Stanley Weekes, Regional Vice Chairman, Executive Vice President & CCO, City National Bank of New Jersey. Arlene Williams, Regional Vice Chairman, Senior Vice President, Seaway National Bank, Chicago, IL. Steve Holt, Regional Vice Chairman, President and CEO, One World Bank, Dallas, TX. Tony James, Associate-Affiliate President, Senior Vice President, ICBA Securities. Deloris Sims, Board Member, President & CEO, Legacy Bank, Milwaukee, WI. Nativido Lozano, III, Board Member, Vice President, International Bank of Commerce, Laredo, TX. James Ballentine, Board Member, Director, Grassroots Advocacy, American Bankers Association, Washington, DC. Viveca Ware, Board Member, Director, of Payments & Technology Policy, Independent Community Bankers of America, Washington, DC. And, The following members from the 52 membership of the National Bankers Association: Broadway Federal Bank, Los Angeles, CA; Unity National Bank, Houston, TX; People's Bank of Seneca, Seneca, MO; United Americas Bank, Atlanta, GA; Seaway National Bank, Chicago, IL; First State Bank, Danville, VA; First Independence Bank, Detroit, MI; OneUnited Bank, Boston, MA; Commonwealth National Bank, Mobile, AL; OneWorld Bank, Dallas, TX; Citizens Trust Bank, Atlanta, GA; Citizens Bank, Nashville, TN; Mutual Community Savings Bank, Durham, NC; Mechanic & Farmers, Durham, NC; Saigon National Bank, Westminster, CA; United Bank of Philadelphia, Philadelphia, PA; Liberty Bank & Trust, New Orleans LA; Industrial Bank, Washington, DC. Mr. Speaker, allow me to start today by expressing the collective condolences of the members of the Oversight and Investigations Subcommittee of the House Financial Services Committee to our ranking member, Representative Gary Miller, following the death of his daughter. Representative Miller was an original cosponsor with me of the legislation we are considering, H.R. 4043, and he and his staff encouraged us to proceed with consideration of the bill today when we offered to withdraw it from the calendar and wait until he returns to Congress following the sudden death of his daughter. I am deeply indebted to Representative Miller for the cordial manner in which he has worked with me as the ranking member of our subcommittee, for his support of H.R. 4043 to ensure that this important legislation is considered in the bipartisan way it deserves, and for his encouragement to us to proceed with consideration of this important bill so it will not be delayed. All of us wish Representative Miller the very best as he and his family try to cope with a loss that we know is devastating to him. Representative Miller's absence under these circumstances casts a significant pall on our consideration of this bill, but we must proceed, and I am happy to do so with his approval. Minority-owned banks and thrifts comprise about 2 percent of all banks, thrifts, and banking assets in the United States. Under section 308 of the Financial Institutions Reform, Recovery and Enforcement Act, the Secretary of the Treasury is required to consult with the Chair of the Board of Directors of the Federal Deposit Insurance Corporation and the Director of the Office of Thrift Supervision on methods to achieve the following five goals: One, preserving existing minority banks; two, preserving the minority character of these institutions in cases involving mergers or acquisitions of minority banks; three, providing technical assistance to prevent the insolvency of existing minority institutions that are not insolvent; four, promoting and encouraging the creation of new minority banks; and, five, providing for training, technical assistance, and educational programs to assist minority banking institutions. The requirement for consultation between the Secretary of the Treasury, the FDIC, and the OTS has been on the books since the passage of the Financial Institutions Reform, Recovery and Enforcement Act in 1989, and the Office of Thrift Supervision has been required to submit an annual report to Congress describing actions taken to achieve these five goals that help preserve and expand minority banks. On October 30, 2007, our Financial Services Oversight and Investigations Subcommittee, which I am privileged to chair, held a hearing about a report issued by the U.S. Government Accountability Office in October of 2006 that reviewed Federal banking regulators' efforts to promote these five goals. This report, entitled ``Minority Banks: Regulators Need To Better Assess Effectiveness of Support Efforts,'' found that, despite recommendations contained in a similar 1993 Government Accountability Office report, none of the Federal banking regulators have routinely surveyed institutions within their jurisdiction to assess the effectiveness of the regulators' support efforts to minority banks nor have the regulators systematically established outcome-oriented performance measures to gauge the effectiveness or results of the regulators' efforts. In short, the efforts being taken by the regulators to preserve and promote minority banks appeared modest, and whether the efforts are being effective could not be ascertained. The regulators were taking some steps, but there were no outcome measures to judge their effectiveness. Indeed, if the number and strength of minority financial institutions since 1989 is a barometer, the efforts of the regulators appear not to be having the positive results we desire. H.R. 4043 would, in effect, increase the pressure on and transparency of the regulators' efforts by requiring all of them, the Federal Deposit Insurance Corporation, the Federal Reserve, the Office of the Comptroller of the Currency, and the Office of Thrift Supervision, to submit an annual report to Congress on their efforts to implement the goals outlined in section 308 of FIRREA, the goals of preserving and supporting and promoting minority businesses. At the subcommittee hearing, all the regulators acknowledged that they could and should be doing more and indicated that they do not object to a statutory change to expand the goals of section 308 of FIRREA to their agencies. In addition, witnesses from the FDIC, the Federal Reserve, and the OCC indicated that they do not object to being obligated to prepare and submit to Congress an annual report describing their efforts to promote and preserve minority depository institutions. H.R. 4043 requires this, and I encourage my colleagues to support the bill. Mr. Speaker, I reserve the balance of my time.

Mr. WATT. Mr. Speaker, I have no further requests for time. Let me conclude, then, by just expressing our sincere thanks to our colleagues on the Republican side and to all of the members of the staff for their work on this bill. We think it is a good bill. It is a bipartisan effort to increase transparency and information to Congress and to promote the expansion and preservation of minority financial institutions, all of which we think is good. I encourage my colleagues to support the bill.

Mr. WATT. Mr. Speaker, I yield back the balance of my time.

Mr. WATT

Mr. WATT. Madam Chairman, I offer an amendment.

Mr. WATT. Madam Chairman, I have a secondary amendment to the Hensarling amendment at the desk which has been made in order under the rule.

Mr. WATT. Madam Chairman, will the gentleman yield?

Mr. WATT. I will give him the same assurance. And I said it in my statement because I just got the gentleman's amendment yesterday or the day before, and I confess that my amendment to his amendment may not accomplish everything that both of us are trying to accomplish either, which is why I said we are going to have to continue to work on this, and I am certainly willing to continue to work with him. I understand exactly what the gentleman is trying to achieve. We share that objective. But we want to make sure that the concerns I raise don't get washed up in the ``knowingly'' term that the gentleman used.

Mr. WATT. Madam Chairman, I yield back the balance of my time.

Mr. WATT

Mr. WATT. Mr. Chairman, I thank the chairman of the full committee for yielding time, and I thank the ranking member of the full committee who has worked with us and recognized that there is a serious problem that is going on in the real estate area, in the lending area, that must be addressed, and I want to applaud the efforts of the chairman for trying to address this issue in a comprehensive and fair way. And perhaps the greatest testament to the chair of our committee is that we have come up with a bill that perhaps not any single person I know is completely happy with, including me. This bill started 4 years ago with an initiative by Congressman Miller from North Carolina and myself, and this was in advance of the escalating foreclosures, the kind of irrational exuberance that was taking place in the real estate market. We saw that this was coming down the road because lending was becoming more available, but it was also becoming more irresponsible because it was viewed as a no-lose proposition. So lenders were making riskier and riskier loans to people who had more and more marginal credit and on terms that were not beneficial to the borrower but were financially beneficial, at least until the foreclosures started, to the lenders. So the predatory lending part of this bill, which is title III, started out as the base bill to address those concerns that were taking place that were predatory practices, taking advantage of vulnerable borrowers so that lenders could make money. Then the onset of the foreclosures started, and the crisis in the marketplace in general reflected itself, and that has resulted in the addition of titles I and II of this bill, which put a framework around brokers, which creates a framework for responsible secondary market participation around lenders who dealt in prime loans. Interestingly enough, over time, it is actually titles I and II that have become more controversial than title III, which was the predatory lending part of the bill. We think that the predatory lending part of the bill certainly has struck the best balance, because it is clear that with predatory loans there will be a national standard, but we are not preempting State laws and the States' ability to continue to innovate. In titles I and II, where we have created a framework for the secondary market, we have preempted some State laws, and we have had trouble finding the right language to do that. We want to do it to create a national secondary market, but we don't want to do it outside the specific requirements that are needed to control the secondary market and make credit available. So there is some angst among a number of us about the preemption language. As I said at the beginning, maybe the best tribute to all of us is that we have a bill that nobody really is completely comfortable with, and all we can say to all of those people is that we will continue to work on this bill not only after it passes the House today, but throughout the process to reach the more delicate balance and a satisfactory balance that at the end of the day will solve the problems in the marketplace and be satisfactory to all concerned.

Mr. WATT

Mr. WATT. Mr. Chairman, I offer an amendment.

Mr. WATT. Mr. Chairman, I yield myself such time as I may consume. The bill, as currently constructed, caps damages at the amount of three times the broker or lender fees for steering. It's crucial to increase the remedies for steering so that a limited remedy does not simply get figured into the cost of doing business. A more effective way of changing broker behavior would be to provide a remedy that provides for the greater of actual damages, or three times the broker or lender fees, because it is unlikely that we will incentivize people not to steer unless we make the penalties sufficiently onerous. We want to eliminate the possibility that a lender will simply treat the remedy in the bill as a cost of doing business, and we believe that making the damages alternatively three times the broker's fees or actual damages will have more impact on reducing this bad kind of conduct. That's what the amendment does. Mr. Chairman, I reserve the balance of my time.

Mr. WATT. Mr. Chairman, I yield 1 minute to the gentleman from North Carolina (Mr. Miller).