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| 3/15/2007 12:00:00 AM |
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| Biggert Seeks Clarification in Fund Delivery Method, Review and Approval Processes for Programs and Products in Government-Sponsored Enterprise (GSE) Bill |
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Opening Statement of the Honorable Judy Biggert
Ranking Republican Member, Subcommittee on Housing and Community Opportunity
U.S. House Committee on Financial Services Committee
Hearing on “Legislative Proposals on GSE Reform”
Thursday, March 15, 2007
Thank you, Mr. Chairman and thank you for holding this hearing today.
I would like to welcome today’s witnesses, Undersecretaries Steel and Lockhart, our GSE representatives, and housing professionals from across the board. I look forward to hearing your views on the latest version of the GSE reform bill, H.R. 1427, the Federal Housing Finance Reform Act.
This is not a new bill or a new issue for those of us who have served on the Committee since, at least, the 106th Congress. We’ve held about 23 hearings and heard from well over 100 witnesses. In May of 2005, this Committee reported out Mr. Baker’s bill, H.R. 1461, by a vote of 65 to 5, and in October of 2005, the House passed the bill by a vote 331 to 90. I supported Mr. Baker’s bill and commend him on his years of work on this issue. Our colleagues on the other side of the Capital failed to act on Mr. Baker’s bill during the last Congress. Hence, we have returned for another round of GSE discussions.
I would like to thank Chairman Frank and Mr. Baker for introducing a GSE bill to establish a new and stronger regulator for the GSEs and the Federal Home Loan Banks. I hope that this legislation will give the new regulator crystal clear direction about its authority, available tools, and mission so that it can guide the GSEs to be most effective for homeowners, market participants, financial institutions, and taxpayers. We also should aim to isolate this regulator from political influence. At this time, I have two concerns with the most recent version of the GSE reform bill.
First, I hope that we can take a closer look at the section of H.R. 1427 on program review and approval. I was very active on this issue last Congress and look forward to working with my colleagues to ensure that we strike the right balance – one that allows appropriate oversight but does not impede the kind of innovation that ultimately is good for consumers and homeowners. Today, we should examine if the language, as drafted, is too ambiguous or if it will accommodate this important balance.
Second, I am concerned about certain provisions in the Affordable Housing Fund section of the bill. HUD is tasked with establishing a formula to allocate funds to states and Indian tribes, which would in turn determine which organizations receive the funds. I am not convinced that this is the best delivery method. Should the language be more specific and outline organizations that are appropriate to receive these funds? Should HUD play a more expanded role in the Fund than the bill envisions? Should the Affordable Housing Fund be modeled after the Affordable Housing Program that is administered by the Federal Home Loan Banks?
I hope today’s hearing will shed light on these specific issues, as well as on other important provisions of the bill regarding mission, portfolio limits, and capital requirements.
Again, I welcome today’s witnesses and thank Chairman Frank for holding this hearing.
I yield back the balance of my time.
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