[Pages H8666-H8686]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

CONFERENCE REPORT ON H.R. 2158, DEPARTMENTS OF VETERANS AFFAIRS AND
HOUSING AND URBAN DEVELOPMENT, AND INDEPENDENT AGENCIES APPROPRIATIONS
ACT, 1998

Mr. LINDER. Mr. Speaker, by direction of the Committee on Rules, I
call up House Resolution 261 and ask for its immediate consideration.
The Clerk read the resolution, as follows:

H. Res. 261

Resolved, That upon adoption of this resolution it shall be
in order to consider the conference report to accompany the
bill (H.R. 2158) making appropriations for the Departments of
Veterans Affairs and Housing and Urban Development, and for
sundry independent agencies, commissions, corporations, and
offices for the fiscal year ending September 30, 1998, and
for other purposes. All points of order against the
conference report and against its consideration are waived.
The conference report shall be considered as read.

Mr. LINDER. Mr. Speaker, for the purposes of debate only, I yield the
customary 30 minutes to the gentleman from Massachusetts [Mr. Moakley],
pending which I yield myself such time as I may consume. During
consideration of this resolution, all time yielded is for the purpose
of debate only.
Mr. Speaker, House Resolution 261 waives all points of order against
the conference report and against its consideration. The rule also
provides that the conference report shall be considered as read.
The conference report for the VA-HUD and Independent Agencies
Appropriations bill for fiscal year 1998 appropriates a total of $68.5
billion for fiscal year 1998, which is $1 billion below the President's
request level.
As I mentioned in this House VA-HUD bill debate in July, this
legislation continues to meet our obligations to our veterans. The
conference report provides $18.9 billion for the Department of Veterans
Affairs' discretionary programs, $17 billion for veterans' medical
care, and $272 million for veterans' medical research, including $12.5
million for research related to Persian Gulf war illness. We owe a
special debt of gratitude to all our veterans, and these appropriations
are notable increases above the amounts the President requested.
I am also pleased that scientific research and our space program have
been amply funded in this bill. We just marked the 40th anniversary of
the launch of Sputnik, and with that in mind, I am pleased that the
conferees have committed the United States toward a significant
presence in space. The conferees have provided $2.9 billion for the
Space Shuttle Program, $2.35 billion for the International Space
Station, and $13.6 billion for NASA, which is $148 million more than
the President requested.
I have one last point on the subject of science. I think it is very
important to point out that this bill provides $631 million for science
and technology research at the Environmental Protection Agency,
including $49.6 million for particulate matter and ozone research. As
proposed regulations are formulated by the EPA, it strikes me that it
is high time we base these decisions on information from scientists
calculated with scientific analysis.
EPA scientific research funding in this bill, especially funding
directed for particulate matter and ozone research, is absolutely
necessary at a time when the American people and American businesses
face the prospect of additional regulations concocted without a shred
of scientific inspection.
I want to commend the gentleman from California [Mr. Jerry Lewis] and
the ranking minority member, the gentleman from Ohio, [Mr. Louis
Stokes] for the bipartisan manner in which they produced this
conference report. It does not appear that there were any major
complications during the conference with the Senate, and I am certain
their good relationship helped to assure this very productive
conference.
I urge my colleagues to support the rule so that we may proceed with
general debate and consideration of the merits of this very important
bill.
Mr. Speaker, I reserve the balance of my time.
Mr. MOAKLEY. Mr. Speaker, I thank my colleague, the gentleman from
Georgia [Mr. Linder], for yielding me the customary half-hour and I
yield myself such time as I may consume.
Mr. Speaker, I want to congratulate my colleagues the gentleman from
Ohio [Mr. Stokes] and the gentleman from California [Mr. Lewis] for
their excellent work on this conference report. I have had the pleasure
of working with the gentleman from California and the ranking member on
some small parts of this bill and I can tell my colleagues they have
done yeoman's work.
They have managed to fully fund American housing and veterans
programs as well as the Federal emergency management program and also
NASA. The conference committee has done an excellent job taking care of
our public housing programs. As someone who grew up in public housing,
I can tell my colleagues it is a very important program. It does
wonderful things for low-income families, particularly families with
children, and I am pleased to see the conference committee agreed to
support it.
Mr. Speaker, this country is facing a terrible loss of affordable
housing. Three million American families just cannot find affordable
housing, and the numbers are climbing. In response to this, the
conference report renews all expiring section 8 contracts and preserves
affordable housing at a time when we are losing affordable housing. It
helps ensure that good housing will still be available to low-income
families, it saves money, and it is a very well thought out policy.
The conference report also funds HOME grants to cities and States for
building affordable housing. And one of these HOME grants went to the
City of Brockton, MA, in my district, which helped 200 people buy homes
last year. This year this program should help even more people.
The conference report also helps take care of America's veterans by
providing over $17 billion for veterans' medical care and $15.5 million
for research on Persian Gulf war illnesses.
So thanks to this conference report, the Consumer Product Safety
Commission is fully funded, as is the Federal

[[Page H8667]]

Emergency Management Association. It also funds the Environmental
Protection Agency, one of my personal favorites, which helps keep our
water and our air clean.
Once again, Mr. Speaker, I just want to congratulate my colleagues
for putting together such an excellent bill. I urge my colleagues to
support this rule.
Mr. Speaker, I reserve the balance of my time.
Mr. LINDER. Mr. Speaker, I yield 3 minutes to the gentlewoman from
Ohio [Ms. Pryce], my colleague on the Committee on Rules.
Ms. PRYCE of Ohio. Mr. Speaker, I thank the gentleman from Georgia,
my friend, for yielding me this time, and I rise in support of this
rule and the VA-HUD conference report.
I would like to commend the gentleman from California [Mr. Lewis],
the chairman, and the gentleman from Ohio [Mr. Stokes], the ranking
member, for ably guiding the VA-HUD appropriations bill through
conference. The final bill they produced speaks very well of their
efforts.
This year's fiscally responsible bill shaves $1 billion off the
President's request and it successfully prioritizes spending to ensure
that we fulfill our responsibility to our Nation's veterans, provide
needed housing to less fortunate Americans, keep the exciting
discoveries of the U.S. space program alive, and provide adequate
resources to keep America's air clean and water safe.
There are many accomplishments in this legislation worth extolling,
but I want to focus on a portion of the bill that is of special
significance to me as a former member of the Subcommittee on VA, HUD
and Independent Agencies. Since the 1970's, section 8 rental assistance
contracts have helped provide private low-cost housing to seniors,
disabled persons, and low-income families. However, these 20-year
contracts have begun to expire, leaving millions of Americans unsure of
the future of their housing.
The funding in this bill to renew expiring section 8 housing
contracts is both important and necessary. However, I have long
maintained that the program itself needs to be restructured to bring
down the high cost of section 8 housing. In that vein, I joined with my
friend from Virginia [Mr. Moran] to sponsor legislation this year to
achieve such reforms. Therefore, I am very grateful to the chairman,
the gentleman from California, the gentleman from New York [Mr. Lazio],
and our colleagues in the Senate for their hard work to forge an
agreement on the section 8 reforms included in this legislation. I know
it was not easy, but I am convinced that it was well worth their
efforts.
The timely reforms in this bill will ensure the stability of section
8 properties so that affordable housing will continue to be available
for our citizens with the greatest need. The solutions this legislation
provides will save hundreds of millions of taxpayer dollars while
putting the power to reform the program where it belongs, right in the
local communities.
For this achievement, and for the many good things in the VA-HUD
conference report, I urge my colleagues to support this rule and move
towards swift passage of the underlying legislation.
Mr. MOAKLEY. Mr. Speaker, I yield 5 minutes to the gentleman from
Texas [Mr. Bentsen].
(Mr. BENTSEN asked and was given permission to revise and extend his
remarks.)
Mr. BENTSEN. Mr. Speaker, I thank the gentleman for yielding me this
time, and I rise today in reluctant support of the fiscal year 1998 VA-
HUD appropriations bill.
I wish to thank the gentleman from Ohio [Mr. Stokes], my good friend
and the ranking member, and the gentleman from California [Mr. Lewis],
the chairman, for their support in funding the International Space
Station project and a robust NASA budget as well as ensuring quality
public housing for our Nation's low-income families.
In particular, I appreciate the committee including a comprehensive
reform of the section 8 program. While issues regarding the mark-to-
market program remain, it is important that the Congress take this
initial step to reform the program, and I look forward to the
opportunity when the Committee on Banking and Financial Services, on
which I serve, moves forward to try to address those concerns as well
as possibly the Committee on Ways and Means, which may also have to
address some of the issues.
However, Mr. Chairman, during previous consideration of this
legislation in the House, both in this Congress and in the 104th
Congress, I had successfully offered an amendment to prohibit the
Environmental Protection Agency from using funds to allow for the
importation of polychlorinated biphenyls, or PCB's, to be disposed of,
including by incineration, in the United States. This directly affects
my district as well as other districts around the country.
While the amendment that I offered was accepted by the House on both
occasions, it was unfortunately struck in the conference, and I very
much regret this decision by the conference committee once again.

{time} 1500

Mr. Speaker, the EPA issued a final rule on March 18, 1996, to allow
the importation of large quantities of PCB waste from foreign nations,
reversing an EPA ban that has been in place since 1980. Later that same
month, the Sierra Club Legal Defense Fund initiated a legal challenge
to the EPA decision allowing the importation on PCB's based on the
principle that it violated the Toxic Substances Control Act of 1976.
On July 8 of this year, the Ninth Circuit U.S. Court of Appeals ruled
in a unanimous decision that the EPA had violated the Toxic Substances
Control Act of 1976. Chief Judge Proctor Hug wrote, ``EPA lacked the
statutory authority to promulgate the Import Rule, which violates the
PCB manufacture ban contained in the Toxic Substances Control Act.''
I believe it is necessary to codify this decision in the event it is
reversed on appeal, and that is what my amendment had sought to do.
However, for now, the court action will forestall the further
importation of this dangerous chemical.
PCB's are a dangerous class of chemicals that collect in the body and
cause a range of adverse health effects including cancer, reproductive
damage, and birth defects. When incinerated, PCB's release dioxin, one
of the most toxic chemicals known. PCB's accumulate in the environment
and move toward the top of the food chain, contaminating fish, birds,
and ultimately humans. They are the only chemical Congress designated
for phaseout under the Toxic Substances Control Act of 1976.
Mr. Speaker, I am disappointed that my amendment was not included in
the conference. I assure the chair and the ranking member that I will
be back next year again to pursue this issue because I think it is
important both to my constituents and to the country. I do not think
that PCB's are a good or a service that we ought to be importing into
the United States.
But in light of the other issues in this bill, I do rise in support
of the remainder of the bill and intend to vote for it.
I thank the gentleman from Massachusetts [Mr. Moakley] for yielding
me the time.
Mr. MOAKLEY. Mr. Speaker, I yield 5 minutes to the gentleman from New
York [Mr. LaFalce].
(Mr. LaFALCE asked and was given permission to revise and extend his
remarks.)
Mr. LaFALCE. Mr. Speaker, I thank the gentleman from Massachusetts
[Mr. Moakley] for yielding me the time.
Mr. Speaker, I rise in support of H.R. 2158, a bill making
appropriations for fiscal year 1998 for VA, HUD, and independent
agencies. I am pleased that the HUD budget has not suffered dramatic
cuts in this era of the balanced budget as it has in prior years.
Most of the administration's budget requests have been met in this
conference report for HUD's core programs, for public housing, for
CDBG, for drug elimination grants, for HOME, for McKinney homeless
assistance grants, et cetera. Although I would support higher funding
levels for HUD programs, I believe the conference report represents a
winning hand, considering the cards that we have been dealt.
Two issues deserve particular mention: The first, the lack of funding
for

[[Page H8668]]

new section 8 certificates; and the second, the very complicated issue
of section 8 portfolio restructuring.
On the first subject, for the third year in a row, there is
absolutely no new money for incremental section 8 housing assistance
even in the face of continued strong evidence that greater numbers of
very low-income families and working poor are finding it ever more
difficult to find affordable housing. Some 5.3 million Americans have
worst case housing needs, and that number grows by leaps and bounds. It
is most regrettable that this conference report was unable to fund any
new section 8 assistance.
On the second issue, section 8 renewals and mortgage restructuring, I
applaud the approach of appropriators and the administration for their
hard work and mutual efforts. The Committee on Appropriations took the
most critical step in this bill. It provides sufficient funding for all
renewals coming due in 1998, and, working with the authorizing
committee, they took the necessary steps to provide the legislative
framework for renewing section 8 contracts.
This was not done during the reconciliation process, but the
appropriations bill provides housing policy that is good Federal
policy, preserves affordable housing, and saves money all at the same
time.
I believe that we have balanced all the disparate interests of the
tenants, owners, communities, and the Federal Government in preserving
as much affordable housing as possible, reducing the costs to the
Federal Government, reasonably protecting the financial investments of
the owners, and protecting the tenants from unnecessary displacement.
This is one of the most critical problems facing the administration
and the Congress. It has been solved equitably for all concerned and
saved $500 million for other domestic priorities in the process. So, on
balance, this is a good bill, considering our budget constraints, and I
would urge my colleagues to support it.
Mr. MOAKLEY. Mr. Speaker, I yield 4 minutes to the gentleman from
Illinois [Mr. Evans].
Mr. EVANS. Mr. Speaker, I thank the gentleman from Massachusetts [Mr.
Moakley] for yielding me the time.
Mr. Speaker, I urge my colleagues to adopt the rule and the
conference report on VA, HUD, independent agencies appropriations for
fiscal year 1998.
As I noted in July when this bill was considered by the House, I
remain concerned about the adequacy of VA health care resources, not
only in the next fiscal year but in the next future years as well.
As most Members know, appropriations for VA health care have been
essentially frozen. As years pass on, inflation will erode the value of
this funding. Proponents of this freeze in appropriations for VA health
care claim that allowing VA medical centers to keep VA copayments and
third-party collections will replace appropriated funds. In its report
earlier this year, however, the House Appropriations Committee noted
that the accuracy of each year's estimated third-party collection
effort is unknown.
With regard to the VA having sufficient resources to meet the health
care needs of our Nation's veterans, the House has failed to enact H.R.
1362, which authorizes a 3-year demonstration program to provide for
discounted Medicare reimbursement for health care services provided to
certain Medicare-eligible veterans at selected VA health care
facilities.
Dr. Kenneth Kizer, the under secretary for health, has recently told
Members that enactment of this legislation is critical to the
Department of Veterans Affairs. According to Dr. Kizer, without
enactment of this legislation this year, VA will not have the resources
needed to provide health care to veterans in future years.
H.R. 1362 was reported favorably by the Committee on Veterans'
Affairs in July but has languished in the House since then. I urge its
favorable consideration by the House as soon as possible.
I am pleased that the conferees have recognized the value of VA
research not only to veterans but to all Americans and have
appropriated a total of $272 million for VA medical research. This is a
sound and wise investment.
The conference also provides an additional $8 million to meet the
needs to help the VA to achieve the year 2000 computer compliance.
Achieving this goal is critical to the delivery of health care and
other earned benefits to our Nation's veterans, their dependents, and
survivors.
So I want to thank the gentleman from Louisiana [Mr. Livingston],
chairman of the full Committee on Appropriations, and the gentleman
from Wisconsin [Mr. Obey], the Democratic ranking member, for their
support. Likewise, I want to salute the chairman and Democrat of the
Subcommittee on VA, HUD and Independent Agencies, the gentleman from
California [Mr. Lewis], and Carl Stokes for their efforts on behalf of
veterans.
Again, I urge my colleagues to support this rule and adoption of the
conference report.
Mr. MOAKLEY. Mr. Speaker, I yield 5 minutes to the gentleman from
Virginia [Mr. Moran].
Mr. MORAN of Virginia. Mr. Speaker, I want to thank the gentleman
from Massachusetts [Mr. Moakley], my friend and the ranking Democrat on
the Committee on Rules, for yielding me the time.
Mr. Speaker, as the gentlewoman from Ohio [Ms. Pryce] said earlier,
the bill that we have been working for for some time that deals with
project-based section 8 assistance is incorporated, virtually in its
entirety, into this appropriations bill. I think this is a very
important step, as the principal focus of our bill is to reduce the
cost of the section 8 program and provide the certainty of continued
housing assistance for those in need.
Our reform proposal reins in exorbitant rental contracts that can
reach 180 percent of the fair market rent, and it helps kick the bad
owners out of the program. Existing debts on all FHA-insured property
are restructured to lower operating and maintenance costs and bring
Federal rent subsidies down to local market levels. In return, owners
of multifamily housing must agree to maintain the property for low-
income tenants for at least another 20 years.
I think this proposal is a thoughtful and reasonable response to a
complex and very difficult issue. So I was very pleased to see almost
all of the elements of this proposal incorporated into this
appropriations bill.
I want to particularly thank the gentlewoman from Ohio [Ms. Pryce],
my copatron, for her tireless work to make sure that this issue got
resolved this year, the gentleman from California [Mr. Lewis], the
gentleman from Ohio [Mr. Stokes], the gentleman from New York [Mr.
Lazio], and the gentleman from Massachusetts [Mr. Kennedy], of the
authorizing committee and the House leadership for permitting this
issue to be resolved through the appropriations process.
Hopefully, we will be able to start a new chapter in low-income
housing programs that meet the needs of low-income families, the
elderly, and the disabled with decent, fiscally responsible, and
affordable housing.
I thank the chairman, I thank the gentleman from Massachusetts [Mr.
Moakley] for yielding me the time, the gentleman from Georgia [Mr.
Linder], I thank the Committee on Rules, and of course the chair and
minority ranking member of the Committee on Appropriations. I think
this is a very important step and certainly plan to vote for the bill.
Mr. MOAKLEY. Mr. Speaker, I yield 2 minutes to the gentleman from
Indiana [Mr. Roemer].
Mr. ROEMER. Mr. Speaker, I thank the distinguished ranking member,
the gentleman from Massachusetts [Mr. Moakley], for yielding me the
time.
I rise, Mr. Speaker, with very, very strong concerns and reservations
about this VA, HUD, independent agencies appropriations bill for fiscal
year 1998. I oppose this conference report due to funding increases for
the international space station above the congressionally approved and
NASA agreed to cap at $2.1 billion per year. Now that is not enough;
$2.1 billion is not enough. We have to go in this bill much above that,
to $2.35 billion, for the space station.
Now, certainly, I have argued with my colleagues, Republicans and
Democrats, in this body that a $100 billion space station is too much,
that we do not return the science, we do not return good science or
good economics

[[Page H8669]]

for our taxpayers. Now we are going up to a $2.35 billion per year
space station, and last month the primary contractor estimated cost
overruns to exceed $600 million, and NASA guessed $800 million cost
overruns.
This means that we have to go into other very, very worthwhile
important programs, Space Shuttle safety, education grants, a host of
other programs, and take money away from good NASA programs that are
working to reward cost overruns.
I think that we need to take a very, very careful look at this
budget, Mr. Speaker, and enforce some physical discipline. We have fits
around here when we have $600 toilet seats. This is a $600 million cost
overrun.
Mr. MOAKLEY. Mr. Speaker, I yield 2 minutes to the gentleman from
Texas [Mr. Green].
Mr. GREEN. Mr. Speaker, I rise, obviously, in support of the rule.
But let me talk about a little problem I have with some of the reforms
that the Housing and Urban Development Department is doing.
I have had an ongoing dialog with HUD over the last 4 areas, and my
main point of discussion is making sure that in the Houston area HUD
offers all the program areas that serve the people in Houston, TX, the
fourth largest city in the country, which they do not.
The problem we have now is, HUD has a reform plan to refocus,
streamline, and downsize the Department. In our Houston office we have
over 100 HUD employees now. Now I hear that we are going to reduce them
to 14. So those 14 are going to have to do the work of those over 100
employees.
We do not even have all the program areas offered now in the Houston
office, and yet, in this reorganization that has been going on now for
a number of years, we are not going to have all the program areas
offered in Houston. If they are offering them with 14 employees, they
are not going to be able to do the job.
HUD now, under the HUD 20/20 reform plan, they have developed two
mission statements. The first is to empower people in communities to
improve themselves and succeed in today's time of transition, and the
second is to restore public trust by achieving and demonstrating
competence.
These are admirable goals, but I am not sure that releasing 85
employees or staffers will help achieve those goals and make HUD
effective in the Houston markets. Again, this is not the first time I
have said this and it will not be the last. I would hope Secretary
Cuomo would be able to sit down with those of us who represent the
Houston area and make sure that HUD can provide all the programs in
Houston even if it is with reduced employees, but do not make it
impossible.
Mr. MOAKLEY. Mr. Speaker, I yield back the balance of my time.
Mr. LINDER. Mr. Speaker, I yield back the balance of my time, and I
move the previous question on the resolution.
The previous question was ordered.
The SPEAKER pro tempore. The question is on the resolution.
The resolution was agreed to.
A motion to reconsider was laid on the table.

{time} 1515

Mr. LEWIS of California. Mr. Speaker, pursuant to House Resolution
261, I call up the conference report on the bill (H.R. 2158), making
appropriations for the Departments of Veterans Affairs and Housing and
Urban Development, and for sundry independent agencies, commissions,
corporations, and offices for the fiscal year ending September 30,
1998, and for other purposes.
The Clerk read the title of the bill.
The SPEAKER pro tempore. Pursuant to House Resolution 261, the
conference report is considered as having been read.
(For conference report and statement, see proceedings of the House of
October 6, 1997 at page H8323.)
The SPEAKER pro tempore. The gentleman from California [Mr. Lewis]
and the gentleman from Ohio [Mr. Stokes] each will control 30 minutes.
The Chair recognizes the gentleman from California [Mr. Lewis].

General Leave

Mr. LEWIS of California. Mr. Speaker, I ask unanimous consent that
all Members have 5 legislative days within which to revise and extend
their remarks on the conference report on H.R. 2158, and that I may
include tables, charts and other extraneous materials.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from California?
There was no objection.
Mr. LEWIS of California. Mr. Speaker, I yield myself such time as I
may consume.
Mr. Speaker, as we bring H.R. 2158 to the floor, I would like the
Members to know that while this is a very complex bill that involves
appropriations for fiscal year 1998 for agencies such as all of our
public housing programs, for issues that flow around the Environmental
Protection Agency, issues that are very important to the future of our
general economy, this very controversial bill comes to us in a
circumstance where these agencies are faced with the overall effort to
reduce the pattern of growth of spending for the Federal Government. So
we are dealing with a shrinking dollar circumstance and very important
and competitive programs, and yet this bill comes to us in a way that
very much reflects the best of bipartisan work in the House.
For that work I want to pay special tribute to my colleague and
friend, the gentleman from Ohio [Mr. Stokes], as well as his very fine
staff that has cooperated so much with us in developing this bill.
Without their support we would have perhaps a lot of controversy today,
but instead I think we have before us truly a model reflecting the way
the Committee on Appropriations, working with their authorizing
committees, should present bills on the House floor.
I think the Members should know that in that environment, so many
important issues competing with one another, about 90 to 95 percent of
our bill has not been authorized for one reason or another. That is,
the authorizing committees have not, over several years in some
instances, been able to move bills through the House and the Senate and
send those bills to the President's desk for signature. So the bill
finds itself in a position where much of the language in the bill
reflects some of the priorities of our authorizers as well, as we go
about trying to deal with the competition for dollars between these
various programs.
Let me illustrate just a bit of that for the Members. The fiscal year
1998 VA-HUD bill reaffirms our commitment to serving veterans,
protecting the environment, providing housing for the poorest of the
poor, and ensuring America's continued leadership in space.
In spite of the difficult challenges in putting this conference
report together, the final product represents a balance of tough
choices as well as common interests.
The bill meets the important test of keeping the appropriations
process on track to meet the vital objective of attempting to balance
the budget shortly after the turn of the century. I might add that
since the fiscal year 1995 rescission bill, this subcommittee has saved
the American taxpayer nearly $25 billion from the President's request.
Yes, I say some $25 billion as we make our contribution to reducing the
rate of growth as we go forward with these very important programs.
Let me take just a moment to list some of the bill's funding
highlights. Within the Department of Veterans Affairs, we have provided
a total agency budget of $40.452 billion. We have increased the Medical
Care account over the President's request by roughly $100 million to a
total of $17.661 billion. That is $648 million over the 1997 level. We
have increased the Medical and Prosthetic Research account by $38
million over the President's request to a total of $272 million.
Within the Department of Housing and Urban Development, we have
provided a total agency budget of $24 billion.
Our bill increases housing for the elderly, section 202, by $345
million over the President's request to a total of $645 million. This
measure also increases housing for the disabled by $20 million over the
President's request to a total of $194 million.
We have increased funding for the Community Development Block Grant
programs by some $75 million to a total of $4.675 billion. Furthermore,
we funded the HOME investment partnership program at $1.5 billion. We
also funded

[[Page H8670]]

the Native American Housing Block Grant program at $600 million.
Finally, we provided the funding necessary to renew expiring Section
8 contracts, which have been discussed by more than one of my
colleagues today. We have also accomplished a critical goal of both
bodies, as well as the administration, by reducing Federal subsidized
rent under Section 8 rental assistance programs to more closely
resemble market rates. In fiscal year 1998 alone, this provision saves
the committee nearly $560 million. Further, it fairly addresses the
concerns of residents and taxpayers, as well as building owners who,
after all, entered into this partnership with the Federal Government in
the first place.
Within the Environmental Protection Agency, we have provided a total
agency budget of $7.363 billion, an increase of $564 million over the
1997 level.
We increased the Superfund program by over $100 million over the 1997
level to nearly $1.5 billion, and provided also $650 million in
additional Superfund funding which is subject to the enactment of an
authorization bill in the year ahead of us.
Further, as a result of recently announced National Ambient Air
Quality Standards, we have provided $49.6 million for particulate
matter research, as an underpinning to try to make sense out of those
standards and the impact they may very well have over time on our
economy.
We have funded State and Tribal Assistance Grants at $3.2 billion.
This represents a $300 million increase over fiscal year 1997 levels
for important Safe Drinking Water and Clean Water programs.
Within the National Aeronautics and Space Agency, we have provided a
total agency budget of $13.648 billion. This amount includes $5.5
billion for the Human Space Flight account, $5.69 billion for the
Science, Aeronautics, and Technology account, and nearly $2.4 billion
for Mission Support.
We have provided the National Science Foundation with a total agency
budget of $3.429 billion.
The Federal Emergency Management Agency has been funded at $829
million, including $320 million for the Disaster Relief account in that
package.
In closing, I want to express one more time my thanks to my ranking
member and good friend for continuing to work in a spirit of
bipartisanship and goodwill on this very important measure. Over the
last several years the gentleman from Ohio [Mr. Stokes] and I have
worked very closely together in the finest tradition of the Committee
on Appropriations, and I am grateful to him for that.
I also want to thank and commend our very capable staff, beginning
with Mr. Del Davis, who has been of great assistance to Mr. Stokes; to
Dave Reich as well, Fredette West, Frank Cushing, Paul Thomson, Tim
Peterson, Valerie Baldwin, Rose Roberts, a detailee who is spending
time with us and carrying on very important assistance, Alex Heslop,
Dave LesStrang and Jeff Shockey for their hard work and long hours in
putting this diverse and complex bill together.
Mr. Speaker, I wish to note that within the Statement of Managers
there are a few corrections that we want to clarify at this point,
before I yield to the gentleman from Ohio [Mr. Stokes], if my
colleagues will be patient with me. I wish to note that there are
certain items contained within the Statement of Managers that were
either printing errors or were inadvertently left out of the final
draft.
Regarding particulate matter research under the EPA's Science and
Technology account: on page 114 of the Conference Report and Statement
of Managers, in the fourth line on the last paragraph, the word
``near'' should be included so the sentence would read, ``Initiate key
near-term research.''
Regarding section 107 grants under Housing and Urban Development, the
conferees included some $32 million. However, the breakdown of the
funding levels was inadvertently omitted from the Statement of
Managers.
The breakdown is as follows: $4 million for technical assistance,
$6.5 million for Community Development Work Study, with a $3 million
set-aside for Hispanic-serving institutions; $500,000 for the National
Center for Revitalization of Central Cities; $7.5 million for the
Community Outreach Partnership program; $7 million for Insular Areas;
and $6.5 million for Historically Black Colleges and Universities.
Regarding Economic Development projects also under HUD, the fourth
item down on page 96 of the Statement of Managers should be in the town
of Arab, Alabama, not Arab, Illinois.
Regarding including the Hazardous Substance Superfund under EPA, the
conferees failed to note in the Statement of Managers that $2.5 million
is to be made available for the Gulf Coast Hazardous Substance Research
Center.
Regarding NASA's Science, Aeronautics and Technology account list of
projects on page 132, the Statement of Managers should include the
following, which were inadvertently omitted: $2 million for the Bishop
Museum in Honolulu, Hawaii.
Mr. Speaker, I include charts and graphs pertaining to my statement
at this time in the Record:

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[[Page H8676]]

Mr. LEWIS of California. Mr. Speaker, I reserve the balance of my
time.
Mr. STOKES. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, I rise in strong support of this conference agreement,
and I urge my colleagues to vote for it. I must say there are several
areas where I wish that we could have done more, but given the
budgetary restraints within which we had to work, I believe the
conferees have done a very commendable job.
First of all, Mr. Speaker, I want to salute the gentleman from
California [Mr. Lewis], the chairman of the subcommittee. Without his
fairness, persistence and sense of humor, I might say, the task of
putting this agreement together would have been immeasurably more
difficult.
I also want to commend the majority staff, in particular Frank
Cushing, Paul Thomson, Tim Peterson, Valerie Baldwin, Jeff Shockey,
Alex Heslop and Rose Roberts also for the patience, professionalism,
and courtesies they have demonstrated throughout the development of
this legislation.
I also want to acknowledge the invaluable assistance I have received
from the minority staff in the persons of Del Davis and David Reich,
whose professionalism and advice and counsel have been enriching to me
at all times, along with Ms. Fredette West of my own congressional
staff who has also been invaluable.
Our chairman, the gentleman from California [Mr. Lewis], has already
indicated a number of the more important details of the conference
agreement. I just wish to make a few additional observations about this
package.
Recognizing the great contributions made by our Nation's veterans,
this agreement provides more for the Veterans Health Administration and
for the VA in total than either the House or the Senate bill did.
Although total funding for the Department of Housing and Urban
Development has been reduced from the amount in the House-passed bill,
most of this change is a result of including Section 8 reforms, the so-
called mark to market provisions, that resulted in substantial savings
to the program, those provisions worked out in long negotiating
sessions involving the administration and the authorization committees.

{time} 1530

I am grateful that the conferees were able to retain the higher
Senate figure, $550 million for the HOPE VI program and the higher
House figure of $1.5 billion for the HOME program.
The conferees also recommend a total of $138 million within HUD's
Community Development Block Grant program for economic development
activities. Some of these funds have been designated for specific
purposes, and a significant portion are available at the discretion of
the Secretary.
In many instances the designated funds will leverage State, local,
and private funding, resulting in synergies that will greatly assist
communities across the Nation. I am convinced that this relatively
small amount of money will reap benefits far in excess of these funds
invested in our cities and towns.
This agreement also reflects discussions held with White House
officials before the conference was concluded. Although we were unable
to provide everything that the administration indicated was required, I
believe that the conferees went a long way to address their concerns.
The largest single item in this category is the inclusion of $650
million for the Superfund program as an advance appropriation for
fiscal year 1999, subject to authorization.
Mr. Speaker, I encourage the administration to work closely with the
legislative committees of jurisdiction so we do not face a similar
situation next year.
Regarding funding for the Environmental Protection Agency, I am
pleased to report that the conferees recommend nearly $7.4 billion in
1998 funding, an increase above the amounts in both the Senate and the
House bills, and more than $500 million above the 1997 total. In
addition, there are no anti-environmental riders in this legislation.
There are other programs of great importance to the administration,
the Corporation for National and Community Service and Community
Development Financial Institutions. Although we could not provide the
entire budget request, we were able to provide significant increases
above the current year.
The conferees faced a difficult situation concerning the National
Aeronautics and Space Administration. Just before the conference NASA
indicated it needed $430 million more than their budget request for the
International Space Station program. Although NASA was proposing to
take the funding from other existing NASA activities, due to the
detrimental impact that this could have on certain NASA programs, this
request was not fully acceded to.
The conference agreement notes congressional concerns with the
ongoing problems plaguing the Space Station, and directs NASA to take
several actions to get the project back on track. Until these actions
occur, some funding for the station will be withheld.
Mr. Speaker, once again, in concluding my remarks, I want to thank
the gentleman from California, Chairman Lewis, for the very evenhanded
way in which he has guided this bill. I have taken great pleasure in
serving on this committee with him and, as the ranking member, have
been appreciative of the bipartisan manner in which he and I have
approached our responsibilities relative to getting this legislation
from the House over to the Senate and then back to the House. For that
reason, I am very proud to be able to support this bill that is before
the House today.
Mr. Speaker, I reserve the balance of my time.
Mr. LEWIS of California. Mr. Speaker, it is my pleasure to yield 4
minutes to the gentleman from Michigan [Mr. Knollenberg], a member of
the committee, for his statement and a colloquy.
Mr. KNOLLENBERG. I want to thank the chairman for yielding me this
time, Mr. Speaker.
I rise to address an issue that I believe strikes at the integrity of
this committee. It came to my attention just last week, and it has
serious implications on what we have done regarding fair housing
activities.
Last week HUD announced the award of fiscal year 1997 funds under the
Fair Housing Initiatives Program, also known as FHIP. As we know, the
FHIP provides support to private, nonprofit organizations to assist in
enforcement of the Fair Housing Act.
For fiscal year 1997, both the House and Senate committees
specifically directed HUD to use FHIP funds only, only to address those
forms of housing discrimination that are expressly proscribed by the
Fair Housing Act. The report emphasized repeatedly that the Fair
Housing Act makes no mention of the practices of property insurance. It
further instructed that the FHIP funds not be allocated for purposes of
enforcing the Act against insurers.
HUD's announcement, in direct contradiction to this committee's
intent, awarded numerous grants specifically for activities including
investigating property insurance and otherwise seeking to enforce the
Fair Housing Act against property insurers. In taking this action, HUD
appears to have ignored completely this committee's directive. This is,
in my judgment, a very serious matter that has implications beyond
fiscal year 1997.
The House in the legislation before us once again stated its intent
that FHIP funds appropriated under this measure should not be used to
address insurance practices.
Mr. Speaker, for the past two fiscal years this committee, including
myself and my good friend the gentleman from Ohio [Mr. Stokes], the
ranking member, have worked together to craft report language to
everyone's agreement. We did not do this to have it ignored by HUD.
Report language is meant to be adhered to, and I intend to question HUD
about their intent and apparent neglect of our wishes.
The House Committee Report on the fiscal year 1997 VA-HUD
appropriations legislation stated:

The Committee intends that funds appropriated to the Fair
Housing Initiatives Program (FHIP) for enforcement of title
VIII of the Civil Rights Act of 1968, as amended, which
prohibits discrimination in the sale, rental, and financing
of housing and in the provision of brokerage services, be
used only to address such forms of discrimination as they are
explicitly identified and specifically described in title
VIII. Recognizing that there are limited resources available
for FHIP activities, the Committee believes that

[[Page H8677]]

FHIP funds should serve the purposes of Congress as reflected
in the express language of title VIII.
The Committee notes that HUD's Office of Fair Housing and
Equal Opportunity has undertaken a variety of activities
pertaining to property insurance under the authority of the
Fair Housing Act. HUD recently testified that, due to
Congressional concern about such activities, it does not
intend to focus its regulatory initiatives on property
insurance. The Committee is encouraged by this statement, but
remains concerned about HUD's use of funds for other fair
housing activities aimed at property insurance practices.
HUD's insurance-related activities duplicate state
regulation of insurance. Every state and the District of
Columbia have laws and regulations addressing unfair
discrimination in property insurance and are actively
investigating and addressing discrimination where it is found
to occur. HUD's activities in this area create an unwarranted
and unnecessary layer of federal bureaucracy.
The Fair Housing Act makes no mention of discrimination in
property insurance. Moreover, neither it nor its legislative
history suggests that Congress intended it to apply to the
provision of property insurance. Indeed, Congress' intention,
as expressly stated in the McCarran-Ferguson Act of 1945 and
repeatedly reaffirmed thereafter, is that, unless a federal
law ``specifically relates to the business of insurance,''
that law shall not apply where it would interfere with state
insurance regulation. HUD's assertion of authority regarding
property insurance contradicts this statutory mandate.

This language, which was repeated almost verbatim in the Senate
Committee report, makes extremely clear that no fiscal year 1997 funds
appropriated for the FHIP were to be used to target the practices of
insurance companies.
On February 7, 1997, I wrote to HUD to seek confirmation that the
Department's Office of Fair Housing and Equal Opportunity [FHEO] would
adhere to the directive expressed in the committee report. I
specifically asked: ``Will the FHEO Office honor any requests for FHIP
funding for activities relating to enforcement of the FHA against
insurers?''
In a letter to me dated March 13, 1997, HUD's Assistant Secretary for
Congressional and Intergovernmental Relations responded: ``All requests
for funding under the fiscal year 1997 FHIP Notice of Funding
Availability [NOFA] will be screened for proposed activities. The
Department will not fund activities relating to enforcement of the
FHAct against property insurers.''
The letter also provided confirmation of intended adherence by the
Department to the Report directive by responding to other questions as
follows:

Question. Will the FHEO Office identify, in its public
announcement of FHIP awards, whether any portion of those
awards might be used for activities relating to applications
of the FHA to insurance?
Answer. Yes, the NOFA will state that activities relating
to application of the Fair Housing Act to property insurance
will not be funded under any of the three Initiatives for
which Congress has allocated funding in FY'97--i.e., Private
Enforcement Initiative, Fair Housing Organization Initiative,
or Education and Outreach Initiative. In addition, the
application kit also will emphasize that such activities will
not be funded, including as an ``in-kind'' contribution to
the budget. Further, the Office of FHEO will place a special
condition on all FY'97 awards regarding this restricted use
of funds.
Question. How will the FHEO Office monitor whether any
portion of its FHIP awards are used for activities relating
to application of the FHA to insurance?
Answer. While the FHEO Office will make it clear that such
activities will not be funded, the Office will monitor
whether any portion of the FY'97 FHIP awards are used for
activities relating to application of the FHA to insurance in
several ways: (1) requiring submission of work products which
would show the scope of planned activities, such as training
outlines, conference agendas and materials, and testing
methodologies; (2) a thorough review of reports submitted
regarding actual activities under the grant, such as
enforcement logs, quarterly progress reports and financial
statements; and (3) on-site monitoring of grantees.
Monitoring visits include interviews with grantee staff and
testers, examination of financial and personnel records,
review of testing and other enforcement records.

Subsequently, in a letter to me dated May 13, 1997 the Assistant
Secretary qualified the above quoted answer by stating that the
Department would seek to ensure that FHIP fund are ``not used for
narrowly focused enforcement purposes'' and that FHIP funded projects
``would not be focused upon a single issue, such as insurance
discrimination.''
Then on September 30, 1997, HUD announced 67 awards of fiscal year
1997 grants under the FHIP. Out of the total of $15,000,000 in funds
awarded, HUD announced that almost one third, an amount of $4,170,002,
was awarded for activities including investigations, testing, and other
enforcement-related projects specifically targeting insurance
companies. This is in direct contradiction of the statements in HUD's
March 13, 1997, letter to me. More importantly, it flatly contravenes
the intent expressed by Congress in the House and Senate Committee
Reports on HUD's fiscal year 1997 appropriations.
Such a flagrant defiance of Congressional intent suggests the need
for serious consideration about continued funding for the FHIP. I note
that the House Committee Report on the fiscal year 1998 VA-HUD
appropriations legislation states:

The Committee is encouraged by HUD's recent testimony and
correspondence stating that the Office of Fair Housing and
Equal Opportunity does not intend to use FHIP funds to
solicit or fund applications that would address enforcement
of the Fair Housing Act against property insurers. As the
Committee has previously emphasized, given the limited
resources available for enforcement of title VIII, it is
appropriate that funds should serve the particular purposes
expressly identified by Congress in the statute. The
Committee appreciates HUD's acknowledgment of these budgetary
priorities and looks forward to the agency's continued
cooperation in adhering to them.

In light of HUD's recent actions, there no longer appear to be
grounds for believing that the Department will, in fact, act in
``continued cooperation and adhering to'' our budgetary priories. This
is a very serious matter that I strongly feel should be addressed
promptly, including, if necessary, through cutbacks in funding for the
Department.
Mr. Speaker, I rise to enter into a colloquy with the distinguished
gentleman from California [Mr. Lewis].
Mr. LEWIS of California. Mr. Speaker, will the gentleman yield?
Mr. KNOLLENBERG. I yield to the gentleman from California.
Mr. LEWIS of California. Mr. Speaker, I am pleased to join in a brief
colloquy with my colleague, the gentleman from Michigan.
Mr. KNOLLENBERG. Mr. Speaker, reclaiming my time, I am pleased to see
that the conferees saw the need and the value to conduct a near-term
research program for PM2.5 immediately. Specifically, as an initial
phase of the program, the conferees noted the ongoing efforts to
conduct research as well as the need to conduct new research with the
goal to start and rapidly complete before the next NAAQS review in
2002. This would be in coordination with NAS and target broad-based
research program, intensively peer-reviewed research in line with the
near-term priorities that the gentleman cites, and to fully reanalyze
the key epidemiologic studies in this program.
We have heard estimates that successful completion of this near-term
research would be in the range of $5 million. I would ask the chairman,
does this agree with the estimates that have been suggested to him?
Mr. LEWIS of California. Mr. Speaker, if the gentleman will continue
to yield, the gentleman is correct, the near-term research is vital,
and $5 million is a good estimate of what would be necessary to carry
out this research.
Mr. KNOLLENBERG. Mr. Speaker, reclaiming my time, would the Health
Effects Institute, HEI, be an example of the type of independent
research institute that was suggested in the conference report that
should have priority to undertake this work?
Mr. LEWIS of California. If the gentleman will continue to yield, Mr.
Speaker, the gentleman is correct. It would be the intent of the
conferees and this conference report that institutes such as HEI would
receive priority in the process laid out in the conference report.
Mr. KNOLLENBERG. I thank the distinguished chairman for his time.
Mr. LEWIS of California. I reserve the balance of my time, Mr.
Speaker.
Mr. STOKES of Ohio. Mr. Speaker, I am pleased to yield 2 minutes to
the gentlewoman from Ohio [Ms. Kaptur], a very hard-working and highly
respected member of the subcommittee.
Ms. KAPTUR. Mr. Speaker, I thank our ranking member, the gentleman
from Cleveland, OH [Mr. Stokes] for granting me this time, along with
our chairman, the gentleman from California [Mr. Lewis], who has been
very gracious.
Mr. Speaker, I rise to engage the chairman in a colloquy on the
proposed VA cemetery, Veterans Administration Cemetery in Guilford
Township, Ohio. I am concerned about the potential conflict that could
arise between Federal and local land and water uses between Medina
County and Wayne County related to the development of that new veterans
cemetery.

[[Page H8678]]

As ranking member of the Subcommittee on Agriculture, Rural
Development Food and Drug Administration, and Related Agencies of the
Committee on Appropriations and a member of this VA-HUD subcommittee as
well, I have heard from many local officials and citizens in the
community concerned about farmlands preservation being essential to the
maintenance of a sound rural economy in this region of Ohio.
Before the final Federal water contracts are negotiated, I would urge
the Veterans Administration to meet with township and other local
officials in both counties to ensure that local land use is respected,
the impact of the proposed VA water acquisition on productive farmland
is assessed, and the best water source for the new national cemetery is
developed.
Mr. LEWIS of California. Mr. Speaker, will the gentlewoman yield?
Ms. KAPTUR. I yield to the gentleman from California.
Mr. LEWIS of California. Mr. Speaker, first let me say that I very
much appreciate the gentlewoman's work on our committee. She is a most
effective member.
She and I have discussed the fact that water rights are really State
and local issues, but at the same time, the gentlewoman is in a perfect
position to make this point at a very appropriate time. I concur with
the gentlewoman from Ohio, and encourage the VA to act expeditiously to
resolve this conflict.
Ms. KAPTUR. Mr. Speaker, reclaiming my time, I thank the chairman
very much for his leadership on this entire measure. Congratulations on
a fine bill, and I want to thank the gentleman from Ohio [Mr. Stokes],
the ranking member, as well.
Mr. LEWIS of California. Mr. Speaker, I am pleased to yield 3 minutes
to the gentleman from New Jersey [Mr. Frelinghuysen], a very diligent
and effective member of our subcommittee.
Mr. FRELINGHUYSEN. Mr. Speaker, I thank the gentleman for yielding me
the time.
Mr. Speaker, I rise in support of the conference agreement. I
especially want to congratulate the gentleman from California, Chairman
Lewis, and the gentleman from Ohio, Mr. Stokes, the ranking member, for
their hard work on this bipartisan agreement, and thank their staffers
for their excellent work in cooperation.
Mr. Speaker, this bill contains essential funding for our Nation's
veterans for protection and preservation of the environment, and for
meeting the housing needs of our older citizens, as well as citizens
with disabilities, and for exploration and scientific research.
While I am pleased that this agreement provides full funding for our
veterans health care system, I remain concerned about the way the VA is
distributing these funds among their new network system and the effect
it may have on our veterans in the Northeast, their access to medical
care. That is why I am pleased that this agreement asks the General
Accounting Office to review the network system and provide Congress
with a report in 9 months on its findings. I look forward to the GAO's
analysis.
In addition, this conference report contains increased funding for
the EPA's Superfund program, and having visited 11 sites in my district
over the last 2 weeks, I am very pleased that the committee has
provided an additional $100 million, for a total of $1.5 billion. As I
have said on previous occasions, there remains a desperate need to
reform the Superfund program. With this agreement Congress is telling
the EPA that we are committed to cleaning up these sites, and at the
same time urges the EPA to work with Congress to reauthorize this
important program.
As detailed in a recent GAO report, the current program spends less
than 49 cents of every dollar on actual cleanups. This is simply not
acceptable. When our citizens ask where the money is for cleanups, the
answer is, the money is there, it is just not used, or in many cases
not being used wisely and effectively. I remain optimistic,
nonetheless, that by working together this program can achieve its goal
of cleaning up all sites across America.
In summary, Mr. Speaker, this is a good, balanced conference report.
I urge my colleagues to support it.
Mr. STOKES. Mr. Speaker, I am pleased to yield 4\1/2\ minutes to the
gentleman from West Virginia [Mr. Mollohan], a very valuable and hard-
working member of our subcommittee.
Mr. MOLLOHAN. Mr. Speaker, I would first like to express my gratitude
to the gentleman from Ohio [Mr. Stokes], the ranking minority member,
for his hard work on this committee and the leadership he has provided.
I have held him in high regard ever since I came here, and I appreciate
his good efforts, and for yielding this time to me. Likewise, I would
express my appreciation to the chairman of the committee for the
excellent work he has done on this bill. I am pleased to join him and
the gentleman from Ohio [Mr. Stokes] in supporting it.
Mr. Speaker, I rise for a colloquy with the chairman.
Mr. LEWIS of California. Mr. Speaker, will the gentleman yield?
Mr. MOLLOHAN. I yield to the gentleman from California.
Mr. LEWIS of California. Mr. Speaker, I am happy to participate in a
colloquy with my colleague and member of the committee.
Mr. MOLLOHAN. First of all, I thank the chairman for agreeing to
participate in this colloquy to discuss how EPA will proceed with the
particulate matter research program. This program will determine the
scientific soundness of EPA's newly announced national ambient air
quality standards, and will ensure that the regulations promulgated
under these standards are based on solid scientific evidence.
As we know, EPA has been criticized for its handling of the current
research program. This criticism has undermined the credibility of the
stated research results, and this in turn has called into question the
recently finalized standards. While we want to move forward on air
quality improvement, it must be justified, because the economic
dislocation associated with the promulgation of new regulations is very
real.
The chairman is to be commended for the inclusion of the $49.6
million in the conference report for the express purpose of developing
a fair and comprehensive particulate matter research program. He is
also to be commended for directing the National Academy of Sciences to
develop and oversee the implementation of this research program and to
periodically report back to the Congress. This process should give
credibility to the program and foster confidence in research results,
thereby laying a consensus scientific foundation for the standard-
setting and promulgation of regulations.

{time} 1545

Since the National Academy of Sciences has until April 1998 to
complete this planning agenda, and since EPA will continue research
activities until then, I would like to clarify how EPA will proceed
with this research program in the interim.
Mr. Chairman, I know that it is very likely that EPA will obligate
some of the 1998 research funds before the completion of the National
Academy of Sciences' planning agenda. It is important that when EPA
does obligate funds, it does so in the spirit of the gentleman's
directive, applying the principles of diversity and scientific
integrity, and I ask if the gentleman would agree.
Mr. LEWIS of California. Mr. Speaker, if the gentleman would yield, I
would respond by saying to my colleague that I very much appreciate his
involvement in this critical issue, a critical issue to us, those of us
who focus on this problem in the Congress, but to the country as well.
Mr. Speaker, I would respond further to the gentleman by saying that
I agree that EPA has worked closely with us in developing the
particulate matter research program outlined in H.R. 2158. They have
pledged to fulfill the requirements in the statement of managers to the
best of their ability. I expect them to exercise sound judgment in the
distribution of funds and be prepared to reorient certain of their
efforts upon completion of the NAS research plan.
Mr. MOLLOHAN. Mr. Speaker, reclaiming my time, it is my understanding
that the research program described in the report is intended to build
on activities currently underway at EPA at the National Institute for
Environmental Health Sciences, the National Academy of Sciences, the
Health Effects Institute, and many other public and private entities.

[[Page H8679]]

Mr. Speaker, I would ask the gentleman from California whether we can
be assured that EPA will establish diversity among the researchers such
that all stakeholders should feel comfortable with the composition of
the research community which would give credibility to the results of
the research.
Mr. LEWIS of California. Mr. Speaker, if the gentleman would yield
further, certainly the gentleman is correct. The legislation, in fact,
directs EPA to ensure that quality researchers participate in broadly
based, comprehensive, competitive, and peer-reviewed research programs.
Only when we bring together a diverse community of the best scientific
minds on this matter, both inside and outside of government, can we
feel assured that science is being used to lay a credible foundation
for policy.
Mr. Speaker, I very much appreciate the gentleman allowing me to
participate in this colloquy.
Mr. MOLLOHAN. Mr. Speaker, again reclaiming my time, I thank the
gentleman from California for his leadership in this matter and for
these clarifications.
Mr. LEWIS of California. Mr. Speaker, I yield 1\1/2\ minutes to the
gentleman from Arizona [Mr. Stump], the chairman of the Veterans'
Affairs Committee.
(Mr. STUMP asked and was given permission to revise and extend his
remarks.)
Mr. STUMP. Mr. Speaker, I rise in strong support of the conference
report on H.R. 2158, and I particularly want to commend the gentleman
from California [Mr. Lewis], the chairman of the Subcommittee on VA,
HUD and Related Agencies, for his insistence that veterans programs be
funded at adequate levels.
Mr. Speaker, I also commend the gentleman from Ohio [Mr. Stokes] for
his effort on behalf of the veterans, and I urge my colleagues to
support this report.
Mr. STOKES. Mr. Speaker, I yield 3 minutes to the gentleman from
California [Mr. Brown], the distinguished ranking member of the
Committee on Science.
(Mr. BROWN of California asked and was given permission to revise and
extend his remarks.)
Mr. BROWN of California. Mr. Speaker, I commend the gentleman from
Ohio [Mr. Stokes] and the gentleman from California [Mr. Lewis] for the
excellent work that they have done in bringing this bill before us.
Mr. Speaker, I do not want to be overly enthusiastic, but in the
roughly 32 years that I have worked with this committee, I think from
the standpoint of the Committee on Science we have probably reached
some sort of a peak of efficiency and effectiveness and concern and
sharing. I want to say that I am grateful for this situation and hope
that it can continue.
I, of course, as the chairman indicated, am the ranking member on the
Committee on Science, which deals with a number of the programs
contained in this bill, NASA, FEMA, EPA, NSF, as far as the research
elements are concerned. I want to say that I feel that in every case
these programs have been treated with sensitivity. Where there are
problems within the agencies, they have been recognized and efforts
have been made to guide them in the right direction.
And we will continue to have problems, of course, with some of these
agencies, NASA and EPA, perhaps amongst the most, and we will need to
continue to give them guidance and assistance in achieving their goals.
Mr. Speaker, I want to also indicate that for many, many years I have
had a deep interest and a high priority in the areas of housing and
veterans' concerns. I served 8 years on the Committee on Veterans'
Affairs, and, again, I compliment the committee for the excellent way
in which they have handled these. I am not as directly involved, but I
am as deeply concerned about these programs as I am with the programs
with research.
So, Mr. Speaker, I look forward to our continued cooperation. I will
not indicate the scientific items on which I am extremely grateful for
the chairman and the ranking member's concern, but I think they know
what they are. But overall, I think the important message is that this
committee in this bill has done more for research and development than
the Administration has asked for. I have been critical of the
Administration because I felt that it was shortchanging some of these
very important investments, and we are now on the right track.
Mr. Speaker, I submit for the Record an article from the latest issue
of Science magazine, the organ of the American Association for the
Advancement of Science, which is headlined: ``Friendly Finish Looms on
Spending.'' Mr. Speaker, this article points out, if I may quote the
first couple of sentences, ``Congress is proving kind to most federal
science and technology programs as it wraps up work on the 1998
budget.''
I include the full article for the Record.

[From Science, Oct. 3, 1997]

Friendly Finish Looms on Spending

(By Andrew Lawler)

Congress is proving kind to most federal science and
technology programs as it wraps up work on the 1998 budget.
The National Science Foundation (NSF) can look forward to a
5% boost in research, spending for defense R&D will rise
enough to cover inflation, and most technology programs that
the Republican Congress loved to hate only a year ago have
sailed through both houses.
But some of the details are not so rosy. Cash-strapped
NASA, for example, faces another delay in the space station.
Congress also ordered the Department of Energy (DOE) to
postpone for at least a year the restart of a troubled
reactor used by neutron scientists at Brookhaven National
Laboratory in Upton, New York. And it failed to grant NSF's
wish to build a polar cap observatory near the magnetic North
Pole.
Here are some highlights of the appropriations bills that
emerged from joint House-Senate conferences last week. They
must still be approved by each body and signed by the
president:
NSF: The good news is that the agency's research account
will increase by $113 million to $2.55 billion. The bad news
is that NSF must spend $40 million of that increase on a
plant genome initiative, a project promoted by agricultural
lobbyists and championed by Senator Kit Bond (R-MO) that was
not part of NSF's request (Science, 27 June, p. 1960). The
agency's education programs will receive $633 million, a 2%
rise that doubles the request.
The toughest decisions came in the agency's account for
large facilities. Legislators did not fund a $25 million
polar cap observatory to study solar-upper atmosphere
interactions, asking for more information on the proposed
site near the magnetic North Pole in northwest Canada.
Senator Ted Stevens (R-AL) wants the facility built at an
Alaskan defense lab, which scientists say would greatly
reduce its value. But conferees added $4 million to complete
the twin Gemini telescopes and maintained initial funding for
the $200 million millimeter array. And they voted $70 million
for a new South Pole station, a compromise between the
Senate's $25 million increment and the House's $115 million
that would have funded the full cost of construction. They
also dropped a House plan to give $5 million more to two
supercomputer centers being phased out.
NASA: The space agency received $13.65 billion, $100
million above the request and close to the 1997 level. But
that windfall won't go far, as the agency failed to win
approval to move money from other accounts into the station
budget to meet cost overruns. Lawmakers like Senator Barbara
Mikulski (D-MD) worried that other programs--particularly the
space shuttle and science efforts--would suffer as a result,
so it severely restricted the agency's flexibility.
Congressional sources say the language is intended to force
the Administration to request a bigger NASA budget, but NASA
managers aren't heartened. ``We're in a bad situation,'' says
one. ``This would force a slip in the station's schedule.''
Mikulski also insisted that NASA use more competitive
methods to distribute money set aside for programs such as
New Millennium, a new program administered by the Jet
Propulsion Laboratory in Pasadena, California, that aims to
test advanced technology for future space science missions.
That move could open the door for Johns Hopkins University's
Applied Physics Laboratory in Mikulski's home state.
DOE: There were few surprises in DOE's final 1998 budget,
which meets the Administration's $2.36 billion request for
science programs. Conferees did give high-energy physics and
nuclear physics slight increases, and added nearly $25
million for several pork-barrel projects in biological and
environmental research. DOE can continue to clean up the
leaking High-Flux Beam Reactor at Brookhaven, but is
forbidden from spending money on restarting it for 1 year,
Martha Krebs, DOE energy research chief, says the reactor
would not have been ready for a restart then anyway, but that
decision on its future is due in January. However, opponents
may try to extend the provision next year.
Environmental Protection Agency: The agency's science and
technology account appears likely to receive $15 million more
than the president request and $80 million above the 1997
level. But the $630 million figure includes $23 million more
for a research program on the health effects of particle air
pollution, with advice from the National Academy of Sciences.
The conferees discarded

[[Page H8680]]

proposals from the House to funnel this money through other
agencies and a Senate plan to set up university-based
research centers.
Defense Department (DOD): Funding for basic science at DOD
has survived a roller-coaster ride to finish at about the
same level--$1.08 billion--as this year. Applied research
funds will increase 8.9% to $3.1 billion. This category
includes grant money for university research activities,
which increases by 7% to $230.8 million. Total R&D at the
Pentagon rises 3.5% to $37.9 billion. In addition, the
conferees have retained several popular biomedical programs,
including $135 million for breast cancer studies and $45
million for prostate cancer research. ``It's a mixed bag,''
says analyst George Leventhal of the Association of American
Universities.
Meanwhile, the massive bill that includes funding for the
National Institutes of Health was still in limbo after
legislators met last Friday. Biomedical advocacy groups hope
the conferees will split the difference between the House's
offer of a 6% increase and the Senate offer of a 7.5% raise.

Mr. LEWIS of California. Mr. Speaker, I yield such time as he may
consume to the gentleman from New York [Mr. Walsh], the chairman of the
Subcommittee on Legislative Appropriations.
(Mr. WALSH asked and was given permission to revise and extend his
remarks.)
Mr. WALSH. Mr. Speaker, I rise in strong support of this conference
report, and I congratulate the gentleman from California [Mr. Lewis],
the chairman, and the gentleman from Ohio [Mr. Stokes], the ranking
member.
Mr. LEWIS of California. Mr. Speaker, I yield 4 minutes to the
gentleman from Iowa [Mr. Leach], the chairman of the Committee on
Banking and Financial Services.
Mr. LEACH. Mr. Speaker, with reservation I rise today in support of
this conference report.
Mr. Speaker, let me begin by offering my appreciation to the
gentleman from California [Mr. Lewis], my friend and colleague, as well
as the gentleman from Ohio [Mr. Stokes], the ranking member, for their
work in completing what is clearly a strong bipartisan agreement.
I would also like to thank the gentleman from New York [Mr. Lazio],
chairman of the Subcommittee on Housing and Community Opportunity, for
his exceptional work in helping craft a solution to the problem of
expiring section 8 multifamily housing contracts. The dedication of the
gentleman from New York and the gentleman from California [Mr. Lewis]
to sound housing and community development policy is a credit to their
respective chairmanships.
Mr. Speaker, so there is no misunderstanding, current section 8
programming symbolizes Congress being placed by prior Congresses in a
catch-22 where good public intentions have, in too many cases, crossed
wires with imperfect private sector motivations, which in turn have
been exacerbated by unrealistic legislation.
The deferred obligations implicit in section 8 housing present
Congress with an untenable choice: Either walk away from projects that
serve hundreds of thousands of needy people, many of whom are elderly,
or accept funding obligations far in excess of those originally
conceived.
The end effect of the current program has been the classic scheme of
advancing programs for the moment, with huge deferred funding
liabilities. Those liabilities have now come due and are stretching the
congressional budget process in an unseemly as well as expensive
manner.
Mr. Speaker, from the authorizing committee's perspective, we have
attempted to devise an approach correcting the deferred liability
schematics of the past. It is clear that the status quo is unfair to
taxpayers and unfavorable to tenants. Owners, on the other hand, have
unintentionally been provided cost-plus incentives to maximize return
without necessarily paying adequate attention to property maintenance.
The section 8 reforms presented by the Senate for consideration by
the Committee on Appropriations were clearly improvements over the
current system, but the House authorizing committee, in negotiations
with the Senate, took the position that the public treasury would still
be at risk and tenants in jeopardy unless systems were put in place
that took owners out of the driver's seat.
Hence, the authorizing committee developed a legislative approach
based on three broad premises: One, full and fair competition among
administrative entities with a greater emphasis and utilization of
nonprofit institutions; two, greater empowerment opportunities for
program participants and the assumption that the greater the choices
allowed tenants, the greater the accountability of landlords; and,
three, stronger protections against potential fraud and abuse by
building checks and balances into Administration decision-making.
Some of our approaches were embraced by the appropriations
conference. We cannot say, however, that our concerns have fully been
met or that we have been pleased with all of the processes of
consideration that have taken place.
Finally, Mr. Speaker, let me just say I must express some concern
with the significant number of targeted special purpose grants included
in this report. At issue are questions of judgment as well as the
proper constitutional role of the Congress, which may in the end be
embarrassed by a President exercising proper line-item veto authority.
Mr. Speaker, with reservation I rise today in support of the fiscal
year 1998 VA, HUD and independent agencies appropriations conference
report.
Let me begin by offering my appreciation to my friend and colleague
from California, the subcommittee chairman, and the ranking member from
Ohio for their work in completing the bipartisan agreement we have
before us today.
I must also thank the Housing Subcommittee chairman from New York,
Mr. Lazio, for his exceptional work in helping craft a solution to the
problem of expiring section 8 multifamily housing contracts. His and
Mr. Lewis' sincere dedication to sound housing and community
development public policy are a credit to their respective
chairmanships.
So there is no misunderstanding, current section 8 programming
symbolizes Congress being placed by prior Congresses in a catch-22,
where good public intentions have in too many cases crossed wires with
imperfect private sector motivations which in turn have been
exacerbated by unrealistic legislation. The deferred obligations
implicit in section 8 housing present Congress with an untenable
choice: Either walk away from projects that serve hundreds of thousands
of needy people many of whom are elderly, or accept funding obligations
far in excess of those originally conceived.
The end effect of the current program has been the classic scheme of
advancing programs for the moment, with huge deferred funding
liabilities. Those liabilities have now come due and are stretching the
congressional budget process in an unseemly as well as expensive
manner.
The goal of the multifamily restructuring legislation contained in
title V of the conference report is to reform today's system, but also
to assure that taxpayers and tenants are better protected in the
future.
In my view, this can only be done if it is clear to landlords that
their ownership is jeopardized both by financial profligacy and by ill-
service to tenants. Hopefully, the conference report lays out a
legislative scheme which allows the Government to more easily say
``no'' and to allow intervention by nonprofits, as well as alternative
voucher approaches. In my judgment, without the possibility of
Government intervention and vouchers, imperfect landlords will be given
free rein.
A key element under the multifamily restructuring program is the
determination of rents for comparable properties, or market rents. The
conference report provides that ``where applicable'' comparable
properties should be located in the same market area as the section 8
project. Thus, the conferees recognize that it may not be possible to
find comparable properties in some areas. This is particularly true for
projects in rural communities, and especially for specially designed
properties for the elderly. In those cases the appraiser could look to
other areas to locate comparable properties.
From the authorizing committee's perspective, we have attempted to
devise an approach correcting the deferred liability schematics of the
past. It is clear that the status quo is unfair to taxpayers and
unfavorable to tenants. Owners, on the other hand, have unintentionally
been provided cost-plus incentives to maximize return without
necessarily paying adequate attention to property maintenance.
The section 8 reforms presented by the Senate for consideration by
the Appropriations Committee were clearly improvements over the current
system, but the House authorizing committee in negotiations with the
Senate, took the position that the public treasury would still be at
risk and tenants in jeopardy unless systems were put in place that took
owners out of the driver's seat.

[[Page H8681]]

Hence the House authorizing committee developed a legislative
approach based on three broad premises: first, full and fair
competition among administrative entities with a greater emphasis on
utilization of non-profit institutions; second, greater empowerment
opportunities for program participants on the assumption that the
greater choices allowed tenants, the greater the accountability of
landlords; and third, stronger protections against potential fraud and
abuse by building checks and balances into administration
decisionmaking.
In this regard, it is interesting to note that the House authorizing
committee's legislation scored savings of $759 million in fiscal year
1998 according to CBO, almost $200 million more than the Senate
legislation. The Appropriations Conference unfortunately chose to lean
to the Senate approach. Nevertheless, from an authorizing committee
perspective, we are pleased that reform is underway and that some of
our approaches were embraced by the Appropriations Committee.
We cannot say, however, that our concerns have been fully met or that
we have been pleased with all the processes of consideration that have
taken place.
Finally, I must express my concern with the significant number of
targeted special purpose grants included in the conference report. For
instance, almost 130 separate communities or projects will receive
exclusive funding grants totaling more than $100 million in carve-outs
under the $138 million Economic Development Initiative program. I must
urge my colleagues to carefully consider the implications of
stipulating so many projects for funding. At issue are questions of
judgment as well as the proper constitutional role of a Congress, which
may, in the end, be embarrassed by a President exercising proper line-
item veto authority.
We in Congress are simply obligated to recognize that there is a
place for professionalism in executive departments like HUD where
individual program priorities should be set. Congress' role should be
to pass broad laws with definitive policy parameters. Individual
program decisions, on the other hand, should largely be left to the
executive branch.
Mr. STOKES. Mr. Speaker, I yield 2 minutes to the gentleman from Ohio
[Mr. Kucinich], my friend and distinguished colleague who shares the
representation of Cleveland, Ohio, with me.
Mr. KUCINICH. Mr. Speaker, I first want to congratulate the gentleman
from California [Mr. Lewis] for the work which he has done on this
important appropriations bill. I also thank the gentleman from Ohio
[Mr. Stokes], my friend, for sharing his knowledge and understanding of
the process with me to enable me to more effectively participate as a
freshman.
Mr. Speaker I rise in support of the conference agreement on the
fiscal year 1998 VA-HUD appropriations bill. This bill provides $13.6
billion for the programs in the National Aeronautics and Space
Administration, which fully funds the President's request, including
the National Aeronautics and Space Administration's aeronautics
program, and also provides for the work associated with Lewis Research
Center, which I am proud to say is served by the gentleman from Ohio
[Mr. Stokes], the gentleman from Ohio [Mr. LaTourette], the gentleman
from Ohio [Mr. Brown], and myself and the entire Ohio delegation.
I am pleased that the conference agreement provides increased funding
for the International Space Station. This action by the Congress will
help to keep the Space Station on schedule.
The bill also provides essential support for Mission to Planet Earth,
the NASA program which will enable a system of Earth observing
satellites to study global climate change.
In this Congress, we have seen important debates about the future of
NASA and the International Space Station. This fiscal year 1998
appropriation will enable the agency to continue its progress on
exploring the last frontier, the frontier of space, while bringing back
to Earth the technological benefits of that exploration.
Mr. Speaker, for this I commend this bill to my colleagues and urge
its support. And I want to express my continued appreciation to the men
and women of the National Aeronautics and Space Administration for
their vision, for their attention to detail, and for their commitment
to our country.
Mr. LEWIS of California. Mr. Speaker, I yield such time as he may
consume to the gentleman from Ohio [Mr. Oxley].
(Mr. OXLEY asked and was given permission to revise and extend his
remarks.)
Mr. OXLEY. Mr. Speaker, I want to be sure that my understanding of
the provisions in the bill before us is correct. As I read the bill, it
appropriates $2.15 billion for the Superfund program, but $650 million
of that money is effectively held in reserve. I ask the gentleman from
California if that is correct.
Mr. LEWIS of California. Mr. Speaker, if the gentleman would yield,
that is correct.
Mr. OXLEY. Mr. Speaker, reclaiming my time, let me further be sure
that I understand the two events that are necessary to unlock the
funding. First, the money will only be available after October 1, 1998;
is that correct?
Mr. LEWIS of California. Mr. Speaker, if the gentleman would again
yield, that is correct.
Mr. OXLEY. Mr. Speaker, again reclaiming my time, second, let me be
very clear in how I ask this question. The money will only be available
at that time if we enact comprehensive Superfund reform; is that
correct?
Mr. LEWIS of California. Mr. Speaker, if the gentleman would continue
to yield, the language requires that Superfund be reauthorized by May
15, 1998, in order to receive the additional funds. It certainly is my
intent that such a reauthorization be comprehensive reform of the
Superfund law.
Mr. OXLEY. Mr. Speaker, again reclaiming my time, is the committee
trying to tell us that it shares our strong desire for fully funding
toxic waste cleanups?
Mr. LEWIS of California. Mr. Speaker, the gentleman is correct.

{time} 1600

Mr. OXLEY. So if we fix it, the Committee on Appropriations will fund
it?
Mr. LEWIS of California. Mr. Speaker, that is correct.
Mr. OXLEY. Mr. Speaker, I thank the gentleman for his time. We will
get a new law as soon as we can.
Mr. LEWIS of California. Mr. Speaker, I yield such time as he may
consume to the gentleman from Alabama [Mr. Bachus].
(Mr. BACHUS asked and was given permission to revise and extend his
remarks.)
Mr. BACHUS. Mr. Speaker, the Subcommittee on General Oversight and
Investigations of the Committee on Banking and Financial Services
undertook an investigation of the CDFI fund in the past year. As a
result of that investigation, the two top officials of that fund have
resigned. I have been working with the Committee on Appropriations to
legislate some safeguards to end the type practices which resulted in
their resignation. Among these practices, one that continues to go on
is they still are paying outside consultants, one, $217,000 for a 15-
month period. I am happy to report to this body today that the
Committee on Appropriations and this conference report, this conference
report has addressed most of these concerns.
There is, however, one concern that I think we are leaving hanging
out there. I do not think it was an intentional thing. I think it was
just the conference language unintentionally may not have taken care of
that.
Mr. Speaker, I wish to yield to the gentleman from California [Mr.
Lewis] for the purpose of engaging in a colloquy concerning this
practice of hiring outside contractors.
Mr. Speaker, is it correct that the VA-HUD conferees sought to
curtail the exorbitant use of management consultants and outside
consultants at the CDFI fund? As we know, they spent a little over $2
million this past year.
Mr. LEWIS of California. Mr. Speaker, will the gentleman yield?
Mr. BACHUS. I yield to the gentleman from California.
Mr. LEWIS of California. Mr. Speaker, the gentleman is correct.
Mr. BACHUS. That being the case, would the gentleman join me in a
request to the Department of Treasury that it immediately bring its
contracting practices at the CDFI fund into conformance with the intent
of the VA-HUD conference report language, that being that contractors,
outside contractors not be paid more than the ES-3 rate?
Mr. LEWIS of California. Mr. Speaker, if the gentleman will continue
to yield, that is my intention and I will be happy to join the
gentleman.
Mr. BACHUS. Mr. Speaker, I have shared with the gentleman my concern,
and I ask the gentleman and the committee to support me in separate
legislation to achieve the goal of limiting

[[Page H8682]]

abusive contracting practices at the CDFI fund. I intend to introduce
legislation.
Mr. LEWIS of California. Mr. Speaker, I very much appreciate the
gentleman's leadership on this matter. I will be happy to join him.
Mr. BACHUS. Mr. Speaker, I thank the gentleman from California.
Mr. Speaker, the Banking Oversight Subcommittee has conducted a
review of the procedures of the CDFI fund administered by the
Department of the Treasury. I think it is safe to say there is a
consensus that the CDFI fund operated with very few safeguards against
abuse during its first round of awards in 1996.
I am pleased that these concerns have been addressed in the VA, HUD,
and independent agencies conference report. However, this conference
report fails to address one area of concern.
One area of abuse by the CDFI Fund brought to the attention of the
Appropriations Subcommittee is the exorbitant use of so-called
management consultants by the CDFI Fund. In less than 2 full fiscal
years, the CDFI fund has paid out approximately $1.2 million to these
management consultants. Our review has shown that contracts were handed
out without full or open competition to a network of contractors.
Certain of these contracts are truly sweetheart deals: one consultant
alone was paid $216,713.41 for part-time work over a period of
approximately 15 months.
I appreciate that the VA, HUD, and independent agencies conferees
seemed to recognize this problem and attempted to place limits on the
amounts the CDFI Fund pays to outside contractors. The conference
report to H.R. 2158 provides funds for the CDFI fund ``including
services authorized by 5 U.S.C. 3109, but at rates for individuals not
to exceed the per diem rate equivalent to the rate for ES-3.
Unfortunately, the conferees seemed to have failed in their goal of
closing this loophole. The conference report language will have no
impact whatsoever upon abuse of contracting authority by the CDFI fund
as it is limited solely to the CDFI fund's use of contractors retained
under 5 U.S.C. 3109. Although much confusion remains concerning the
procedures used by the CDFI fund in selecting outside contractors and
fixing their compensation, the one thing that has been established is
that the CDFI fund did not rely upon 5 U.S.C. 3109 in retaining its
contractors. As a result, the conference report fails to place any
limitations upon the CDFI fund's use of contractors.
Mr. LEWIS of California. Mr. Speaker, I reserve the balance of my
time.
Mr. STOKES. Mr. Speaker, I yield 3 minutes to the gentleman from
North Carolina [Mr. Price], a very distinguished and valuable member of
the subcommittee.
Mr. PRICE of North Carolina. Mr. Speaker, I am proud to support this
conference report. As a new member of this subcommittee, I am grateful
to both the gentleman from California [Mr. Lewis] and the gentleman
from Ohio [Mr. Stokes] for their evenhanded bipartisan work in putting
together this difficult piece of legislation.
The bill has broad support from both parties and in both Chambers. In
numerous ways this conference report addresses our Nation's critical
priorities. For example, the report increases the appropriation for
veterans' medical care to $17.7 billion, higher than either House
initially approved, with $600 million coming from medical care cost
recovery sources.
The report increases funding for the HOME program at the Department
of Housing and Urban Development to $1.5 billion, $109 million above
last year's level. The HOME program allows those providing affordable
housing to use Federal block grants to leverage private sector money
with a minimum of unnecessary regulation. It is an efficient and a
practical way to open up homeownership to thousands of Americans. I am
pleased that in a tight budget year we were able to find additional
resources for HOME.
Funding for the EPA at a level of $7.4 billion is more than $500
million above the fiscal 1997 level. The budget for EPA includes $3
million for research and monitoring of Pfiesteria, an environmental
threat that even now, the full dimensions of that threat are not known
to us. In addition, nearly $50 million of the funding at the EPA is for
research on fine particulate matter. Many of us may have differences
over the new clean air regulations. No one can argue with the necessity
of doing research to determine exactly what standard is justified.
Within the FEMA section, I was pleased that language that would have
restricted States and municipalities from using disaster relief to
clean up streams and parks and beaches was removed, giving full
flexibility for the use of these funds which have been critical in
allowing my State to recover from last year's devastation caused by
Hurricane Fran.
The National Science Foundation receives a healthy 4.7 percent
increase to a level of $3.4 billion. I am particularly pleased that in
that NSF budget we have given good support to the Advanced Technology
Education program, which for the first time has the NSF working
effectively with our Nation's community colleges.
I am very appreciative, Mr. Speaker, of the leadership of the
gentleman from Louisiana [Mr. Leach] and the gentleman from California
[Mr. Lewis], the gentleman from Wisconsin [Mr. Obey] and the gentleman
from Ohio [Mr. Stokes]. I want to add my appreciation for the excellent
staff work that has been done on this bill, as fine as any I have ever
seen. The help I received, particularly from Frank Cushing and Valerie
Baldwin on the majority side, Del Davis and David Reich on the minority
site, has been absolutely invaluable.
I urge my colleagues to support this conference report. I assure them
they can do so with confidence.
Mr. STOKES. Mr. Speaker, I yield 2 minutes to the gentleman from
Wisconsin [Mr. Obey], distinguished ranking member of the full
Committee on Appropriations, who has been of great assistance to both
me and the gentleman from California [Mr. Lewis] as we developed this
bill and took it through to the point where we now bring it.
Mr. OBEY. Mr. Speaker, let me make clear that I think that this bill
is very much short of what we need in a variety of areas, including
environmental protection, housing and veterans' care. The problem,
however, is that this committee was constrained in its ability to meet
those needs by the budget agreement, and given that fact, I think the
committee has done a perfectly reasonable job.
I am especially pleased by the fact that the committee did not do
what is often done in this place, which is to dump amendments that are
adopted in the House once they go to conference on important matters. I
am happy that the committee retained the spirit of the amendment that I
offered when this bill was on the floor, which removed a good many
millions of dollars for the insider deal on the wind tunnel and instead
transferred that money to veterans' funding so that we could do a
better job of providing for veterans' health care.
I am pleased that the committee retained the spirit of that amendment
in conference and wound up providing a higher amount for veterans'
health care than was in the original administration request or the
committee bill. I appreciate that action on the part of the gentleman
from California [Mr. Lewis] and the gentleman from Ohio [Mr. Stokes]
and the committee.
Mr. STOKES. Mr. Speaker, I yield myself such time as I may consume.
I have no further requests for time. I will just take a moment once
again to express my appreciation to my chairman, the gentleman from
California [Mr. Lewis] for the excellent manner in which we have been
able to work together and bring this legislation to the floor. I think
both of us take a great deal of pride in the fact that we think that
our work together is a model for this institution and the manner in
which bipartisanship can bring to the floor the kind of legislation
that all of us can support. I do support this conference report, and I
do urge all my colleagues to vote for it.
Mr. Speaker, I yield back the balance of my time.
Mr. LEWIS of California. Mr. Speaker, I yield myself such time as I
may consume.
Let me echo my colleague's remarks about the bipartisanship of the
work that we have done together. I want to express my appreciation to
the gentleman from Wisconsin [Mr. Obey], ranking member of the full
committee, certainly the gentleman from Ohio [Mr. Stokes], my
colleague. I am very appreciative of the help of the gentleman from
Louisiana [Mr. Livingston], as well as all of our staff.

[[Page H8683]]

I would just note one item. The bill is a very complex bill, as we
have suggested. We have operated in a circumstance where a very high
percentage of our bill has not been authorized, in some instances for
several years. It is very important, to help us with that work, that
our authorizing committees go forward with their work as well. We will
try to work with them positively in the next Congress or the next go
around. Without authorization, it is very difficult to reflect all the
needs of the Members of the House.
Mr. FAZIO. Mr. Speaker, I rise today to discuss the health care needs
of Northern California's veterans, as the debate on the Conference
Report to the VA, HUD and Independent Agencies Appropriations bill
comes to a close. Included in the bill is the Department of Veterans
Affairs' plan for veterans health care in Northern California. I
recommended that the conference committee which negotiated the final
version of bill accept and fully fund this plan, and I am pleased that
they did.
Serving the health care needs of Northern California's veterans has
always been and will always be one of my top priorities. The Loma
Prieta earthquake of 1992 rendered the veterans' hospital in Martinez,
CA unusable, and for the last several years I have worked with my
colleagues in the House, the veterans in my district and the Veterans
Administration to ensure the veterans in the area receive the medical
care that they deserve. Since the Martinez Hospital closed, I have
relied heavily on the input and feedback from the local veterans
community, represented by Operation VA. Without question, Operation VA
has been the voice of the veterans community, and their tireless
commitment to this cause has kept the issue in the forefront for the
last several years.
This has been a long hard fight. In 1994 and 1995, I worked with my
colleagues in the House to secure funding for a new veterans hospital
to be built at Travis Air Force Base, but several studies were
commissioned that recommended against construction of a new hospital at
Travis. The recommendations of the most recent study, completed by
Price Waterhouse, did not adequately address the needs of Solano
County's veterans. Working together with area veterans, led by
Operation VA, through hard and dedicated work, we were able to convince
the VA and Congress that the Price Waterhouse recommendations were an
insult to the men and women in the Travis area who are dependent on the
VA to address their health care needs. We persuaded the VA to re-
evaluate the needs of the Travis area veterans. To that end, they
recommended the Air Force give one-third of Travis's David Grant
Medical Center's inpatient beds to the VA creating a wing that will be
staffed by VA doctors and they recommended a comprehensive VA
outpatient clinic at Travis.
This bill includes funding and a commitment that will allow Travis to
become a viable veterans health care center. This is a bittersweet
victory because while we fell short of our ultimate goal of a full
fledged hospital at Travis, we were able to secure much more than the
Price Waterhouse report recommended and our Congressional opposition
was willing to provide us. I will continue to fight to make sure that
the long-term health care interests of Solano County's veterans are
addressed and I will work to make sure everyone involved honors their
commitments.
Mr. DOYLE. Mr. Speaker, I would like to express my strong support for
a provision in H.R. 2158, the fiscal year 1998 VA-HUD funding bill that
would significantly improve the health care provided to the veterans of
Western Pennsylvania.
Language included in this measure would allow the University Drive VA
Medical Center (VAMC), located in Pittsburgh, PA, to go ahead with
plans to renovate a number of the hospital's patient rooms and support
facilities. The improvements are planned for the main building of the
University Drive facility, which has not been significantly changed
since it was built in 1954. The renovations will bring the medical
center up to VA minimum standards for life safety, patient privacy and
handicapped accessibility. Additionally, these changes are required to
more adequately meet the needs of the increasing number of female
veterans who are being treated at the medical center.
This project would improve the overall quality of health care
provided at the University Drive VAMC, a facility that plays an
important role in VA health care, not only in the Pittsburgh area where
I live, but across the entire Veterans Integrated Service Network 4
(VISN 4) region. In addition to serving as the primary medical facility
for many of the veterans in my district, the University Drive facility
serves as a major medical-surgical tertiary care center for the entire
western Pennsylvania VA health care network. The facility also operates
a number of specialty services, such as liver transplantation, that
benefit veterans across an even wider geographic area.
Even though the University Drive VAMC holds significant
responsibilities within the VA health care system, current conditions
at the facility are making it increasingly difficult for hospital staff
to continue to provide high quality medical care. This past Spring, I
revisited the facility and toured the main building where the
renovations are planned. The conditions that I found, which would be
alleviated under the renovation plans funded by this bill, would not be
tolerated for a single day in a private hospital environment, let alone
the years that such conditions have been present at University Drive.
The University Drive facility has patient rooms with such limited
space that a patient must be removed from the room when another patient
is brought in on an emergency room gurney to share that room. In other
patient wards, as many as 16 veterans share quarters, with limited
space and only hanging cloth screens between them. Congregate bath
facilities create additional dilemmas for patients and hospital staff,
especially with the number of female veterans being treated at the
facility increasing. These and other problems associated with the aging
building not only inconvenience patients, but also put unnecessary
obstacles in the path of hospital employees and their efforts to
provide quality medical care to these veterans. Such conditions are
certainly not consistent with how we should be honoring and caring for
our nation's veterans.
The VA health care system is a very important part of the Pittsburgh
community. Our area has one of the largest populations of veterans in
the Nation. Thus, VA benefits and services, including health care, have
played a large part in the lives of many of our residents.
One of the things I am proudest of about the people of western
Pennsylvania is that they understand the gifts our Nation's veterans
have given to them. They realize that it is because of the sacrifices
our veterans have made on battlefields around the globe that our Nation
has been able to prosper, and this prosperity has allowed us to enjoy,
among other things, a medical system that is one of the best in the
world. I am pleased that H.R. 2158 would finally allow the veterans of
western Pennsylvania to share a piece of that medical prosperity, a
benefit that they helped secure for the rest of the Nation, and one
that is long overdue to the veterans of western Pennsylvania.
Mr. PAYNE. Mr. Speaker, I would like to take this opportunity to
commend the Chairman and Ranking Member of the VA/HUD and Independent
Agencies Subcommittee for their hard work on this important funding
bill. In addition to the crucial funding for affordable housing,
especially Section 8 units for low-income and the elderly, the measure
includes provisions which will promote economic growth and development
in communities throughout the Nation. I want to express my personal
thanks for an important investment that my colleagues agreed to make in
my home city of Newark. Let me especially thank Chairman Jerry Lewis,
Ranking Member Louis Stokes, and my good friend and New Jersey
colleague Rodney Frelinhuysen, for their responsiveness to our request
to include $3 million for the restoration of Weequahic Park, a site
which has great potential for stimulating our local economy and
enhancing the quality of life for local residents.
Improvements in Weequahic Lake, which falls within Newark's
Enterprise Community boundaries, make it accessible for families,
school children, church groups and other members of the community.
We are all aware of the severe budget restraints under which Congress
is operating, but I believe that investments in housing and in our
communities are sound investments which will bring considerable future
returns. I urge approval of the VA/HUD conference report.
Mr. SHUSTER. Mr. Speaker, I rise in support of the conference report
on H.R. 2158, the VA-HUD-Independent agencies appropriations act for
fiscal year 1998. This bill provides needed funding for, among other
agencies, the Environmental Protection Agency (EPA) and the Federal
Emergency Management Agency (FEMA).
First of all, as chairman of the Transportation and Infrastructure
Committee which has jurisdiction over EPA and FEMA, I want to thank my
colleagues on the Appropriations Committees for their cooperation. In
particular, I want to thank the gentleman from California (Mr. Lewis)
for his leadership as chairman of the House Appropriations
Subcommittee. As usual, he and his staff have worked hard to
accommodate colleagues and produce a reasonable bill. While in a
perfect world no Appropriations bill would include authorizations or
policy-making provisions, provisions in this bill have generally
attempted to take into account concerns of the authorizing committee.
With regard to EPA's clean water and drinking water programs, I would
make a few comments and clarifications. I appreciate the efforts of the
conferees to provide a level of funding ($1.35 billion) for the Clean
Water

[[Page H8684]]

Act's State revolving fund (SRF) that is higher than the level
requested by the administration. The record compiled by our committee
and other speaks for itself; adequate funding to capitalize and
maintain clean water SRFs pays enormous dividends in terms of
environmental protection and economic development.
I am also pleased to support provisions allowing the so-called
``cross-collateralization'' between the CWA SRF and Safe Drinking Water
Act SRF. This flexibility can be extremely helpful to states as they
strive to administer clean water and drinking water programs to meet
infrastructure needs. I would note that Senate-passed language was
modified in conference to clarify that nothing in the provision
authorizes the transfer of funds between the SRFs or in any way
conflicts with the combined financial administration provisions
in Section 130(g) or transferability of funds provisions in section 302
of the Safe Drinking Water Act Amendments of 1996. In addition, nothing
in this provision affects in any way the jurisdiction of or
understanding between the House Transportation and Infrastructure
Committee and the House Commerce Committee relating to the clean water
act, the safe drinking water act, and the two SRF's.

I would also like to clarify provisions regarding the State and
tribal assistance grants and accompanying joint explanatory statement
of managers. The conferees included funds for wastewater and drinking
water system needs in Clearfield, Mifflin, Snyder, and Fulton Counties.
Unfortunately, the statement of managers inadvertently omitted the
community of Wallace-Boggs as the recipient of $1,250,000; I have been
assured the intent of the conferees was simply to include the language
in the report of the House Appropriations Committee which did in fact
specify Wallace-Boggs as the recipient. In addition, the reference in
the statement of managers to Adams Township should instead be to Union
Township. I appreciate the indulgence of my colleagues on the
Appropriations Committee for the opportunity to correct this technical
error.
Regarding Superfund, I would simply make a few observations. I am
encouraged by the contingent appropriation of an additional $650
million if specific reauthorization of the Superfund Program occurs by
May 15, 1998. The Superfund Program doesn't simply need more money. In
fact, more money without reform can cause more harm than good.
Superfund needs comprehensive, statutory reform and redirection. For
too long, the program has been ineffective and unfair, resulting in far
too few cleanups and too much litigation. I am hopeful the May 15, 1998
date will help our efforts to move comprehensive reauthorization and
reform legislation through the Congress and to the President as soon as
possible.
I would also note that the conferees have properly limited the use of
Brownfields Grants. Brownfields initiatives are important, but EPA
currently has no authority to spend superfund money for remedial
actions at facilities that are not on the national priorities list. In
addition, Congress must first review and authorize the use of revolving
funds before the executive branch proceeds down that path.
Regarding appropriations for FEMA, I am pleased that the conferees
resisted language proposed by the Senate prohibiting the use of
disaster relief funds in certain instances. I share the conferees'
concern regarding the escalating Federal cost of natural disasters but
feel that solutions to this problem are better considered as part of a
more comprehensive and deliberative reauthorization process.
In contrast, I would note that the uses specified in the statement of
managers for portions of the pre-disaster mitigation fund are not
authorized. Indeed, existing authority for such a fund is extremely
narrow and it seems extremely likely that the vast bulk of the $30
million appropriated for this fund will be spent on unauthorized
projects. I would encourage the appropriations committees and FEMA to
work closely with the authorizing committees as these provisions are
implemented and as we consider legislation to provide appropriate
authority for pre-disaster mitigation efforts.
Mr. Speaker, I urge my colleagues to support the conference report.
Mr. WELDON of Florida. Mr. Speaker, for far too long, the veterans of
east central Florida have had to travel great distances to receive
quality inpatient medical care. This is an intolerable situation which
I have worked hard to change. In the Fall of 1998, a new VA clinic will
be opened in Brevard County which will help meet the outpatient medical
needs of local veterans. This will be the first ever permanent facility
to serve area veterans in east central Florida.
However, the long drives for hospital stays currently continue. That
is why I led the effort in the last Congress to allow the VA to
contract with local health care facilities for inpatient care. This
year, language I wrote with my colleague Bill McCollum establishing
this pilot program was included in H.R. 2158, the fiscal year 1998 VA/
HUD Appropriation Bill. The program was funded at the level of $5
million in the House bill. This language was not included in the Senate
version, but the final House-Senate agreement included the provision.
This pilot project represents the wave of the future, a new and more
efficient way to deliver quality health care to those who have
sacrificed so much for our freedoms. No longer should the brave men and
women who served their country selflessly have to travel long distances
for quality care. I am confident that this project will be a great
success, and will lead to more widespread contracting efforts in the
future.
I strongly support this conference report and I urge my colleagues to
vote ``yes'' on behalf of our Nation's veterans.
Mr. LAZIO of New York. Mr. Speaker, I have strong reservations about
the legislative approach the conference report takes toward resolving
the problem of expiring section 8 multifamily housing projects under
HUD. The House first recognized this problem in the 104th Congress by
including in the House Budget Resolution language addressing the so-
called mark-to-market dilemma. However, the Senate rejected the
provision included in that act. Although the House has been working on
this issue for the past two years, I remain concerned that legislation
of this magnitude was formulated outside of the regular legislative
process. Given the complexity of the program, lack of available data,
and the short amount of time to negotiate, the authorizing committees
or with outside groups have not vetted many of the details. I believe
the conference report legislation may lead to unforeseen, unintended
consequences.
The legislation included in the report raises a number of problems,
including: First, the likelihood that owners will not participate in
this program before their contracts expire because of the uncertainties
surrounding the tax consequences of mortgage restructuring; second, the
inadequate protection and representation of the taxpayer, third, an
over-reliance on HUD, the only Federal Agency to be classified as high-
risk, which would effectively control the office that administers this
program and affects billions of taxpayers' dollars; and fourth, the
lack of full and fair competition to select the most qualified entity
to work one-on-one with owners in the restructuring process, leaving
housing finance agencies with a virtual monopoly.

unknown tax consequences

The uncertainties surrounding the tax consequences of mortgage
restructuring may undermine the legislation's effectiveness and
ultimately reduce the savings of the reforms. The most responsible
mark-to-market approach would motivate owners to restructure their
mortgages before their contracts expire. Such proactivity on the
owners' part is vital to the savings of the legislation. Under the
conference report, owners will likely not participate in the program
before their section 8 contracts expire because the tax consequences of
mortgage restructuring are uncertain. Therefore, I am concerned not
only that the reforms will not achieve the expected savings but, also
that a better bill would achieve more savings.
On September 17, 1997, the Subcommittee on Housing and Community
Opportunity held a hearing regarding the tax consequences of FHA-
insured, section 8 multifamily housing mortgage restructuring. In that
hearing, Ken Kies, Chief of Staff of the Joint Committee on Taxation
testified that:

Absent legislation or a Treasury announcement clarifying
the Federal income tax treatment under any of the HUD
restructuring proposals, it is likely that many project
owners will not elect to restructure the FHA-insured
mortgages before the expiration of their section 8 contracts
for fear of incurring immediate tax liabilities. . . .
However, it is clear that if all project owners restructure
their mortgages under any of the proposals it is likely that
some of these taxpayers will recognize taxable income as a
result of the transaction. The possibility of such
recognition likely will inhibit many project owners from
electing to restructure their mortgages under a proposal.

Moreover, under the conference report's legislation, up to 26 percent
of the owners may be forced to choose foreclosure over a bifurcated
mortgage restructuring or debt forgiveness because of the different tax
treatment of the events. A foreclosure would result in increased costs
to the taxpayers as well as a loss of valuable affordable housing stock
for low-income families, seniors, and persons with disabilities. I do
not want to force a decision based on tax issues that could result in
low-income families--particularly seniors--being thrown out into the
streets. I want the owners to be no better, nor substantially worse
off, than they would have been had they not chosen to participate in
this program.

LACK OF TAXPAYER PROTECTION AT THE FEDERAL LEVEL

The conference report legislation does not adequately represent and
protect taxpayers against fraud and abuse. In 1996, the HUD inspector
general concluded that HUD's Office of Multifamily Housing was ``not
equipped to

[[Page H8685]]

provide reasonable stewardship over taxpayer funds expended for its
programs.'' In addition, the Department's poor record in administering
its existing programs has earned it the designation by the General
Accounting Office of being at ``high-risk'' for waste, fraud and
abuse--the only Cabinet-level Agency in history to receive such a
designation. In this context, HUD is simply ill-equipped to handle
complex financial restructurings so that the American taxpayer is
protected. For this reason, I fought for a provision in this
legislation to create an Office of Multifamily Housing Assistance
Restructuring [OMHAR], a temporary office within HUD for purposes of
administering the mark-to-market program. For any chance of success,
the program must be administered by a highly professional staff with
the proper technical knowledge, functioning as much as possible at
arms-length from the standard HUD bureaucracy.
The Office will be led by a Director appointed by the President, with
the advice and consent of the Senate, who must have proven experience
in restructuring complex financial transactions. The President is
required to choose the Director within 60 days after enactment of this
legislation. Funding for the Office shall come from HUD salaries and
expenses so there will be no net increase in expenditure of taxpayer
funds in connection with the operations of the Office. The Office is
limited in scope and mission, established solely to administer the
mark-to-market program. Confusion and the possibility of ``mission
creep'' or of being burdened with secondary objectives are thereby
avoided. Although the Office will sunset at the end of fiscal year
2001, I expect Congress will need to reauthorize the Office through
fiscal year 2003, at which time the majority of project-based contracts
will have expired.
OMHAR is the taxpayer's proxy to assure that the restructuring
process is administered as professionally and efficiently as possible.
For this reason, the Secretary must not interfere with the independent
functioning of this Office. I am disappointed that Congress has missed
an opportunity to create a truly independent entity that would not be
forced to answer to the HUD Secretary. However, as an alternative, this
legislation requires the Director to report to Congress immediately on
any action or directive by the Secretary that has an adverse impact on
the functioning of the Office, or that may undermine its effectiveness.
As chairman of the Subcommittee on Housing and Community Opportunity,
the relevant authorizing and oversight subcommittee, I have every
intention of closely monitoring the Department in this regard in order
to ensure that the interests of the taxpayer are not ignored.

LACK OF TAXPAYER PROTECTION AT THE LOCAL LEVEL

The conference report legislation may also negatively impact taxpayer
interests at the local level due to the selection process created for
choosing participating administrative entities [PAE's]. Under the
legislation, PAE's will work with owners to restructure their
mortgages, making decisions on the size of the second mortgage and the
amount that the mortgage must be written down to create a sustainable
bifurcated mortgage. Both of these items will be paid for by the
American taxpayer out of the FHA fund. Therefore, the PAE should be the
most qualified entity for the job. As discussed in the conference
report, such may not be the case. Instead, the selection process in the
report gives housing finance agencies [HFA's] an effective monopoly. If
an HFA meets minimum qualifications, it must be selected, even if
another entity is more qualified. Although in many cases HFA's will be
the most qualified entities, there is no reason to give them a
priority.
Optimally, HFA's should form partnerships with other entities, such
as experienced nonprofits, to better meet the needs of the
restructuring program. When an entity is controlling millions of
dollars of the Federal Government's budget, it should be the most
qualified entity available. We owe that to Americans who work hard
every day to pay their taxes. They expect Congress to spend their tax
dollars wisely and efficiently. I do not believe that will be done if
PAE's are not chosen in an open, competitive process. It is my hope
that Congress will reconsider this provision in the near future.

tenant empowerment and self-sufficiency

One important principle, for which I am gratified that the House
conferees adopted the authorizing committee's position, is the greater
emphasis on choice-based assistance. Vouchers bring a market mechanism
to federally assisted housing by motivating owners to maintain their
properties and compete for tenants. I seek to empower tenants before
owners or bureaucrats. Tenants with vouchers often have a greater
opportunity to reach self-sufficiency by choosing where to live. Rather
than being forced to live in projects that are be run-down and in
dangerous neighborhoods, tenants can make decisions based on the school
system, the proximity to job opportunities, community safety, and the
condition of the apartments. I fully expect that, for a large
percentage of eligible projects, project-based assistance will be
converted to vouchers, in large part because the legislation allows a
5-year transition period for gradual movement toward tenant-based
assistance. This transition will provide owners time to rehabilitate
projects and change their image in the communities in order to be
financially viable after such a conversion.

conclusion

Regardless of the uncertainty surrounding the unforeseen consequences
of enacting the conference report legislation, the Appropriations
Committee feels the need to enact legislation immediately to fill a
$500 million shortfall in funding for nonhousing programs. Most parties
involved admit that this legislation will need substantial revisions
within the next year. Congress should not pass incomplete, flawed bills
solely to generate savings for other programs but should, instead, pass
good legislation that truly solves the problem.
House of Representatives, Committee on Banking and
Financial Services,
Washington, DC, September 23, 1997.
Floyd L. Williams,
National Director of Legislative Affairs,
Internal Revenue Service, Washington, DC.
Dear Mr. Williams: I am writing to seek your guidance on
certain tax matters involving one of the most complex issues
facing the Banking Committees of both the House and the
Senate. As you may know, I refer to the restructuring of the
FHA-insured Section 8 multifamily housing portfolio.
Recently, I introduced H.R. 2447, the ``Multifamily Housing
Restructuring and Affordability Act of 1997,'' which creates
a program for mortgage restructurings. Senator Mack has
introduced S. 513, which has similar objectives.
With some differences, both bills provide for the use of
bifurcated mortgages in restructuring existing debt. Inherent
in this approach is the belief that the restructured debt
would be excluded from the application of IRS Code Section
7872, based on the temporary regulations under section
1.7872-5T(b)(5) regarding below-market interest rate loans.
One of the required provisions under these temporary
regulations is that these below market-interest rate loans be
made available under ``a program of general application to
the public''.
The proposed House and Senate legislation apply to projects
with FHA debt that meet the following criteria:
1. rents must exceed the rent of comparable properties in
the same market area;
2. the project must be covered in whole or in part by a
contract for project-based assistance; and
3. the project must be financed by a mortgage insured under
the National Housing Act.
In his written testimony before the House Subcommittee on
Housing and Community Opportunity on September 16, 1997, Mr.
Ken Kies of the Joint Committee on Taxation raised as an
issue the possibility that ``the HUD refinancing program will
not qualify under this regulation on the basis that it is not
a program of ``general application,'' but only an offer made
to certain owners.'' Since an integral component of the
success of any legislation is an understanding of the likely
tax consequences to owners associated with restructuring
their Section 8 mortgages, your clarification of the meaning
of ``general application'' in this regard is critical.
I would appreciate your immediate attention to this issue
as legislation is moving forward quickly. If the approaches
envisioned in either H.R. 2447 or S. 513 do not meet this
``general application'' requirement, please provide guidance
as to what technical modifications are needed. If you have
any questions or comments, you may contact Shanie Geddes or
Joe Ventrone at 202/225-6634. I look forward to your
response.
Sincerely,

Rick Lazio,

Chairman, Subcommittee on,
Housing and Community Opportunity.
House of Representatives, Committee on Banking and
Financial Services,
Washington, DC, June 18, 1997.
Hon. Robert E. Rubin,
Secretary, Department of Treasury,
Washington, DC.
Dear Secretary Rubin: During yesterday's testimony before
the Senate Subcommittee on Housing Opportunity and Community
Development, HUD Secretary Andrew Cuomo stated that the
Department of Treasury believes that the bifurcated mortgage
restructuring ``tool'' included in S. 513, ``The Multifamily
Assisted Housing Reform and Affordability Act of 1997,''
would result in an immediate taxable event for most owners.
The Secretary went on to note further that ``while this
provision purports to address owners' tax problems, it is
unworkable--thus defeating the larger purpose of the
legislation.''
Apparently, there remains considerable confusion as to the
tax treatment of a soft-second mortgage in the restructuring
of FHA-insured mortgages subsidized by Section 8 project-
based assistance. The issue of taxation in the mortgage
restructuring is vital to the success of any bill that deals
with the Section 8 crisis. You addressed this concern in your
work on the tax provisions included in the Administration's
legislation: H.R. 1433--Housing 2020: Multifamily Management
Reform Act, which was introduced

[[Page H8686]]

in the House by myself and Congressman Joseph Kennedy at the
request of the Administration. A workable bill must
proactively bring project owners to the bargaining table
early. Based on Secretary Cuomo's testimony, it is unclear
that S. 513 would prevent participants in the program from
being subject to negative tax consequences in the future,
thus discouraging proactive restructuring.
A workable tax treatment of restructuring is critical in
this matter. Otherwise, we risk simply perpetuating the FHA
multifamily restructuring demonstration programs included in
FY1996 and FY1997 appropriations. If the House is to agree to
consider FHA multifamily restructuring legislation in
expedited procedures (i.e. during the budget reconciliation
process), the solution must not be simply an academic
exercise that implements incremental change.
Please provide the Subcommittee with a clarification of the
Administration's position on the taxation of soft-second
mortgages as included in S. 513. Your timely response is
critical to solving this dilemma.
Sincerely,

Rick Lazio,

Chairman, Subcommittee on
Housing and Community Opportunity.

Mr. LEWIS of California. Mr. Speaker, I have no further requests for
time, I yield back the balance of my time, and I move the previous
question on the conference report.
The previous question was ordered.
The SPEAKER pro tempore (Mr. Pease). The question is on the
conference report.
Pursuant to clause 7 of rule XV, the yeas and nays are ordered.
The vote was taken by electronic device, and there were--yeas 405,
nays 21, not voting 7, as follows:

[Roll No. 505]

YEAS--405

Abercrombie
Ackerman
Aderholt
Allen
Andrews
Archer
Armey
Bachus
Baesler
Baker
Baldacci
Barcia
Barr
Barrett (NE)
Barrett (WI)
Bartlett
Barton
Bass
Bateman
Becerra
Bentsen
Bereuter
Berman
Berry
Bilbray
Bilirakis
Bishop
Blagojevich
Bliley
Blumenauer
Blunt
Boehlert
Boehner
Bonilla
Bonior
Bono
Borski
Boswell
Boucher
Boyd
Brady
Brown (CA)
Brown (FL)
Brown (OH)
Bryant
Bunning
Burr
Burton
Buyer
Callahan
Calvert
Camp
Canady
Cannon
Capps
Cardin
Carson
Castle
Chabot
Chambliss
Chenoweth
Christensen
Clay
Clayton
Clement
Clyburn
Coble
Coburn
Collins
Combest
Condit
Conyers
Cook
Cooksey
Costello
Coyne
Cramer
Crapo
Cubin
Cummings
Cunningham
Danner
Davis (FL)
Davis (IL)
Davis (VA)
Deal
DeFazio
DeGette
Delahunt
DeLauro
DeLay
Dellums
Deutsch
Diaz-Balart
Dickey
Dicks
Dingell
Dixon
Doggett
Dooley
Doolittle
Doyle
Dreier
Duncan
Dunn
Edwards
Ehlers
Emerson
Engel
English
Ensign
Eshoo
Etheridge
Evans
Everett
Ewing
Fattah
Fawell
Fazio
Filner
Flake
Foley
Forbes
Ford
Fowler
Fox
Frank (MA)
Franks (NJ)
Frelinghuysen
Frost
Furse
Gallegly
Ganske
Gejdenson
Gekas
Gephardt
Gibbons
Gilchrest
Gillmor
Gilman
Goode
Goodlatte
Goodling
Gordon
Goss
Graham
Granger
Green
Greenwood
Gutierrez
Gutknecht
Hall (OH)
Hall (TX)
Hamilton
Hansen
Harman
Hastert
Hastings (FL)
Hastings (WA)
Hayworth
Hefley
Hefner
Herger
Hill
Hilleary
Hinchey
Hinojosa
Hobson
Holden
Hooley
Horn
Houghton
Hoyer
Hulshof
Hunter
Hutchinson
Hyde
Inglis
Istook
Jackson (IL)
Jackson-Lee (TX)
Jefferson
Jenkins
John
Johnson (CT)
Johnson (WI)
Johnson, E. B.
Johnson, Sam
Jones
Kaptur
Kasich
Kelly
Kennedy (MA)
Kennedy (RI)
Kennelly
Kildee
Kilpatrick
Kim
Kind (WI)
King (NY)
Kingston
Kleczka
Klink
Klug
Knollenberg
Kolbe
Kucinich
LaFalce
LaHood
Lampson
Lantos
Largent
Latham
LaTourette
Lazio
Leach
Levin
Lewis (CA)
Lewis (GA)
Linder
Lipinski
Livingston
LoBiondo
Lofgren
Lowey
Lucas
Luther
Maloney (CT)
Maloney (NY)
Manton
Manzullo
Markey
Martinez
Mascara
Matsui
McCarthy (MO)
McCarthy (NY)
McCollum
McCrery
McDade
McDermott
McGovern
McHale
McHugh
McInnis
McIntyre
McKeon
McKinney
McNulty
Meehan
Meek
Menendez
Metcalf
Mica
Millender-McDonald
Miller (CA)
Miller (FL)
Mink
Moakley
Mollohan
Moran (KS)
Moran (VA)
Morella
Murtha
Myrick
Nadler
Neal
Nethercutt
Ney
Northup
Norwood
Nussle
Oberstar
Obey
Olver
Ortiz
Owens
Oxley
Packard
Pallone
Pappas
Parker
Pascrell
Pastor
Paxon
Payne
Pease
Pelosi
Peterson (MN)
Petri
Pickering
Pickett
Pitts
Pombo
Pomeroy
Porter
Portman
Poshard
Price (NC)
Pryce (OH)
Quinn
Radanovich
Rahall
Ramstad
Redmond
Regula
Reyes
Riggs
Riley
Rivers
Rodriguez
Rogan
Rogers
Rohrabacher
Ros-Lehtinen
Rothman
Roukema
Roybal-Allard
Ryun
Sabo
Salmon
Sanchez
Sanders
Sandlin
Sawyer
Saxton
Schaefer, Dan
Schaffer, Bob
Schumer
Scott
Sensenbrenner
Serrano
Sessions
Shadegg
Shaw
Shays
Sherman
Shimkus
Shuster
Sisisky
Skaggs
Skeen
Skelton
Slaughter
Smith (NJ)
Smith (OR)
Smith (TX)
Smith, Adam
Smith, Linda
Snowbarger
Snyder
Solomon
Spence
Spratt
Stabenow
Stark
Stearns
Stenholm
Stokes
Strickland
Stump
Stupak
Sununu
Talent
Tanner
Tauscher
Tauzin
Taylor (MS)
Taylor (NC)
Thomas
Thompson
Thornberry
Thune
Thurman
Tiahrt
Tierney
Torres
Towns
Traficant
Turner
Velazquez
Vento
Visclosky
Walsh
Wamp
Waters
Watkins
Watt (NC)
Watts (OK)
Waxman
Weldon (FL)
Weldon (PA)
Weller
Wexler
Weygand
White
Whitfield
Wicker
Wise
Wolf
Woolsey
Wynn
Yates
Young (AK)
Young (FL)

NAYS--21

Ballenger
Campbell
Cox
Crane
Ehrlich
Hoekstra
Hostettler
Kanjorski
McIntosh
Minge
Neumann
Paul
Peterson (PA)
Roemer
Royce
Rush
Sanford
Scarborough
Smith (MI)
Souder
Upton

NOT VOTING--7

Farr
Foglietta
Gonzalez
Hilliard
Lewis (KY)
Rangel
Schiff

{time} 1630

Mr. SMITH of Michigan, Mr. SCARBOROUGH, and Mr. RUSH changed their
vote from ``yea'' to ``nay.''
Mrs. NORTHUP, Mrs. ROUKEMA, Mr. ROHRABACHER, and Mr. BLUNT changed
their vote from ``nay'' to ``yea.''
So the conference report was agreed to.
The result of the vote was announced as above recorded.
A motion to reconsider was laid on the table.

____________________