The end of the 107th Congress may be near. The House passed their homeland security bill. At press time, the Senate continued to debate the bill to create a Department of Homeland Security. A compromise on labor protections was reportedly reached, and with the clearing of this key hurdle, completion on this bill could be near. One of the primary reasons for the lame-duck session was to create this new department.
The other key reason for the post-election session was to resolve the appropriations situation. Consideration of the 11 remaining appropriations bills is becoming increasingly unlikely. The House has passed yet another temporary spending bill. This particular continuing resolution funds the government through January 11, 2003 at the 2002 spending levels. The Senate has not yet acted on this legislation.
In other noteworthy Congressional activity, the House passed a new bankruptcy reform bill. Following a defeat on a procedural motion to consider the Bankruptcy Abuse Prevention and Consumer Protection Act (HR 333), House leaders called up the bill without the controversial abortion rider. (This provision exempted certain abortion clinic protestors from bankruptcy protection.) Available information suggests that the NAHMA supported provisions included in the conference report to prevent dangerous tenants from using bankruptcy laws to avoid eviction remained intact in the amended bill. However, the House passage is a pale victory. It appears the amended bill will not be considered in the Senate. Associated Press reporter Jesse Holland quoted current Senate Majority Leader Tom Daschle as saying “House Republicans killed bankruptcy for this year.” Daschle said the only bill with a chance of passing was the compromise conference report. Furthermore, if Senator Trent Lott becomes Majority Leader before the lame-duck session ends, the amended bill would likely face a filibuster by Senator Charles Schumer, the author of the abortion rider.
The House also approved the Terrorism Risk Insurance Act (HR 3210) conference bill. The Senate has not acted on the terrorism insurance conference report at this time, but may do so soon. The President has pushed hard for this bill, and will sign it. HR 3210 seeks to expand the availability of terrorism insurance. A brief description of this legislation was offered by Financial Services Committee Chairman Mike Oxley in his November 14 floor statement:
“Let me just talk about the key elements briefly of this bill. The conference report provides full payback protection for American taxpayers, guaranteeing that the first $10 to $15 billion in losses will be paid by the insurance marketplace with the Secretary fully able to recoup any additional amounts necessary…
“Secondly, we have incorporated a transition period that provides immediate full commercial terrorism coverage for all American business consumers while long-term contracts under the bill are being negotiated; in other words, an immediate start at getting these projects up and running and 300,000 people back to work.
“Three, the Federal backstop has been simplified and requires that insurers have to pay a sizable deductible before they are eligible for the Federal backstop. This deductible is increased from 7 to 15 percent of their premiums over the program to phase out the taxpayer exposure and foster the reemergence of a private insurance market for terrorism. It insures that only truly catastrophic events trigger any Federal involvement while continuing to provide equal protection for small and rural insurers.
“Fourth, we have provided more disclosures and information to consumers, with more options to insure that terrorism coverage is available in all commercial policies.
“In addition, we continue to provide strong penalties to punish insurers who defraud the government. State insurance and reinsurance programs can be fully covered by the Treasury Secretary to provide equivalent protections for Americans who are unable to obtain insurance in the private markets. And we continue to give victims of terrorist attacks the ability to enforce court judgments against terrorists’ assets.
“Finally, while I would note that the legal protections may not be as strong as I or others would desire, they are all improvements over existing law and are very similar to those strongly approved in the Committee on Financial Services over 1 year ago.”
At the NAHMA Summer meeting in Park City, NAHMA opted not to support a terrorism bill that did not protect us from predatory lawsuits and did not lessen the cost of insurance for us. More scrutiny of HR 3210 is necessary to determine if this bill meets NAHMA’s criteria for support.
Two HUD nominees were confirmed by the Senate this week. Alberto Faustino Trevino is now officially the Assistant Secretary for Policy Development and Research at HUD. Likewise, Carolyn Y. Peoples is the new Assistant Secretary for Fair Housing and Equal Opportunity.
Finally, I would like to end this week’s column by discussing a small bill with potentially big implications. The Improper Payments Information Act (HR 4878) has cleared both chambers, and will be signed by the President. It had bipartisan support. HR 4878 requires that federal agencies submit an estimate of the amount of improper payments made in their programs to Congress by March 31 of the following year. For improper payments exceeding $10 million, the report must also include a description of how the agencies will reduce the errors.
Even the most conservative estimates of HUD’s improper payments for rental subsidies far exceed $10 million. In fact, the HUD Inspector General’s estimate has been $1.7 billion in net erroneous payments. So, expect that both OMB and the new Congress will “get tough” on HUD to reduce the improper payments.