Remarks by:
Raymond K. James, Esq.
CARH Lobbyist
Coan and Lyons
Washington, D.C.
202.728.1070
The News From Washington, cont'd
We all have our different memories of Ronald Reagan. I remember in 1980 he fired me from my political job in government. He made me go out into private practice and try to make a decent, honest living.
Before our winter meeting in Phoenix I worked very hard to find a clean joke, but my time was cut so drastically, I didn’t have a chance to tell it, so here goes.
A husband and wife are talking, and the wife asks, “Honey, if I die, will you remarry?” “Well, I don’t know,” he replies. “If I find the right person, for the companionship, yeah, I guess I would remarry.” She asks, “Well, if you remarry, will she live in my house?” “It’s a nice house,” he says. “I’ve fixed it up the way I like. Yeah, we’d live here.” “Will she sleep in my bed?” she asks. And he says, “Well, it’s a new bed, I spent $2,000 for it, it’s very comfortable. So, yeah, I guess she’d sleep in your bed.” Then she asks, “Will she use my golf clubs?” And he answers, “Oh no. She’s left-handed.”
There’s something else that Ronald Reagan liked about Washington. A fact of life in Washington is that people come and go, and you work with some people, you get along with them, you like them, they like you, and then they go. Then on the other side of things is that there are some people you’d rather see go, but they never seem to leave.
And it’s not just a matter of personal relationships. It’s a matter of what gets done and what doesn’t get done. I learned that at my first job in Washington. I came down as Counsel to a subcommittee of the House Judiciary Committee, and the Chairman was an elderly Congressman from Louisiana. We got along fine, he liked my work, and I was feeling good about myself. And then he died. And the new Chairman didn’t know me and didn’t know my work, and so I had to start all over again. I had spent two years working for the old Chairman, and now I had a new Chairman. Well, that repeated itself, of course, a good many times.
Ongoing Relationships Are ImportantWhen I went over to the HUD General Counsel’s office, my boss had been there for some time and was quite a talented lawyer. And he said, “You know, the one thing I can’t stand about government service is that every time there’s a new General Counsel or a new Secretary, you’ve got to start from scratch. All the great things you did, all the points you made, they’re all gone with the old guy.” And he said, “I can’t take this any more.” He became General Counsel and later departed, so he was the new guy to somebody else.
But it’s crucial to our work as a national organization located in Washington to have relationships with Executive Branch employees, Congressional staff and Congressional Members. I’ll just give you one example.
When Relationships WorkI was very close to someone who worked for a very, very influential Congressman, and she was very talented. I would tell her, “This is the problem, I would like this solution.” She’d go to him and we’d get a law. It was really amazing. So I would go to her a lot. We were working on some major legislation that year that got enacted, and she was great, and her Member was great, and then she told me she was leaving. I said, “Oh gosh, we were working so well together, and it was really nice to be able to go to somebody and say, ‘I need this,’ and get it done, legislatively.” She even got into a creative program for one project, created a whole $15 million program, so it was a nice relationship, and then she left.
“There’s This Lawyer”And she told me she’d put in a good word with her successor. Her replacement had worked on the Hill for this Member fifteen years prior to this but hadn’t worked there since then and I didn’t know her. So her replacement came. I found out later she told her replacement, “There’s this lawyer in Washington and he’s going to lobby you a lot.”
I called her up to brief her on all the things that were happening with her Member. It turned out that I had called her on her first day on the job, and she told me, “Call me back in six months.”
Well, I couldn’t believe that. Nobody ever said that to me. They might say next week, next day, or whatever; but, six months! So I didn’t talk to her for about a year. Never called her back. And then later because of legislation we were working on that I had to talk to her, and now we are very close personal friends.
Canceling CommitmentsAfter that stormy start we developed a really good relationship. And that relationship is important to anything I want to get done on your behalf. But you know it could have gone the other way. She could have said six months and never talked to me again. But it worked out fine, and one of the things we like to think we can do is to develop relationships with people making decisions about your business.
Now, there are some people that you can never get a good relationship with. The only comfort there is that this is usually shared by a lot of other people, so that I don’t feel it’s just me, that I cannot develop a good relationship, but it seems that a lot of other people can’t either.
And one of those people is primarily responsible for the mess we’re in with the Section 8 voucher program. Just briefly, the Appropriations Act last year was written in a way that many, many PHAs will find out that they do not have the money to renew their existing contracts. And this is having a ripple effect. For those of you who are interested in the project-based program, for example, the PHAs are saying, “Gee, we’ve got to cancel our commitments to the owners or developers of the projects on this program.”
Always Enough $, BeforeOne PHA last week told me, “This new construction project that was supposed to get my project-based vouchers was a month from completion, but I had to cancel it. I had to figure out how to cancel it because I just don’t have enough money.”
So it’s not only affecting the voucher program and the people who participate in it, the landlords and tenants, it’s carrying over to the project-based program as well. It’s a very serious, severe blow. Those who have worked in that program since its beginning in 1974 are saying that this has never happened before, there’s always been enough money to renew the contracts for all the assisted tenants.
So this is extremely serious, and some legislation has been introduced to reverse the impact of the legislation. Congressman Barney Frank (D-MA), ranking Democrat on the House Financial Services Committee, has introduced a Bill that would roll back the Appropriations Act provision and he has many, many co-sponsors. And Senator Charles Schumer (D-NY) has introduced an identical Bill in the Senate, also with many, many co-sponsors.
Concern for Low IncomeThese Bills are flying in and they’re getting a lot of critical publicity, but they’re not intended to be enacted. There’s no way these Bills are going to be enacted. They purport to amend the prior Appropriations Bill. The only way they would ever see the light of day is if the Appropriations Committees adopted them, and they’re not going to change what happens for 2004.
The only purpose of these Bills, and the only hope that they have, is that they will persuade the appropriators for 2005 not to do the same thing they did in 2004. I seriously doubt that they will do the same thing because the national publicity has been tremendous. Every day there are several articles around the country about notices being given to current tenants that they’re going to be terminated. This is really a historic moment if it comes to be that tenants are terminated. Notices have been given, but so far no one — at least as of last Thursday — has been put on the street. But it’s going in that direction.
How come HUD is not doing anything about this?
This is an election year. One of the raps against President Bush is that he’s not concerned about the poor, he’s more interested in giving tax breaks to the rich and in helping corporations. Now here’s a situation where his Department of Housing and Urban Development is letting all this bad publicity occur because they are not providing interpretations of the law and they’re not providing money from other sources to prevent anyone from losing their homes.
Well, the last response — and this is all I’m going to say about the issue — I was on a conference call with the Assistant Secretary last Thursday. He said he had urgent news for the industry, and we thought, Oh, he’s found some other money; I know they have other money. He took $150 million from 2003 and spread that out, but that’s not enough. So I know they have other money. So what is this urgent message? He wants the industry to support a change in the Regulations so that when the payment standard is lowered, tenants will immediately have to pay a higher rent. Under current Regulations tenants have between 13 and 24 months before they’re affected by changes to the payment standard. So basically HUD is saying that the solution to this crisis, to avoid terminating contracts, is for the tenants to pay a higher rent. This is totally consistent, I think, with the way this Department has been running its affairs last two or three years.
Guns and Tax CutsPeople have asked what’s going on with Appropriations for 2005 for Rural Housing and HUD?
Well, I feel a little like I’m saying the same thing every year, but we’re in a flat period. It’s a little bit like when Lyndon Johnson was President, and there were guns and butter; he spent a lot of money on guns, on the Vietnam War, and he spent a lot on butter — on social programs. But what we have had for the last several years here, particularly in the last two or three years, we have guns and tax cuts — guns and tax cuts, with nothing for butter. And that's where we are. We have a Budget that gives money to Homeland Security, that’s building up our military supplies, paying for at least two wars and keeping the forces around the globe.
If we’re lucky, we don’t get cut in the domestic area. If we can keep steady, maybe get a little bit for inflation, we’re very, very lucky. We have had guns and tax cuts, and we cannot have butter, too. That is beyond the realm of possibility. If we have guns and tax cuts, we can’t have increases in our domestic programs.
Saved by CongressSo that’s where we are in Appropriations. We’ve been able, at least, in the last two years, to counter the Administration’s attempt to lower it by $50 million to $60 million and do away with any new construction. Instead Congress has provided almost twice that amount. That is about as much as we could ever expect the Congress to do, given the fiscal situation. Where the Administration recommends $60 million and the Republican-controlled Congress provides $115 or $116 million, that is something that we should be pleased about.
It’s certainly not enough, but it’s something we should be pleased about.
CDBG, HOME ConstituencySomeone this morning said, “Well, how come HOME and CDBG seem to do all right?”
Well, first of all, those are two massive block-grant programs that go to cities all over the country and to all the states. There’s just an enormous constituency for those two programs. But the fact is, CDBG has hardly kept up with inflation over the thirty years it’s been on the books. In spite of its popularity, it has not been the beneficiary of Appropriations increases beyond inflation.
The HOME program, another great popular program which started in 1990, had a few bumps in its Appropriations over the last several years, but as far as expanding, it’s not going to. These are programs supported by every city and every state in the country; it is not like the 515 program. Yet they have failed to grow in any measurable respect.
Now the likelihood for Appropriations is again, as in the last two years, that Congress really won’t get to it until the fall, or maybe into the winter. We’re looking at another Continuing Resolution to keep the Government operating after October 1, and then at a post-Election session of Congress. As Colleen Fisher puts it, there’s not much time before the Congress goes away and allows the members to try to be re-elected. So they will come back, it’s almost guaranteed. They will come back, and one of the things they’ll do when they come back, and the election’s out of the way, they’ll give you Appropriations.
Back Burner for HousingI don’t know how long it will take, but last year they finished in January, the year before they finished in February. This year, since it’s a new Congress starting, I think they’ll try to finish in December.
Now we will have some activity before then in the House. There’ll be a markup next week, so when you go to see your Members you should ask for as much funding for the rural programs as possibly can be done. The Senate was scheduled to have a markup, but that’s been indefinitely postponed.
Now, on housing legislation, a few years ago they took the word “housing” out of the name of the Committee that handles RHS and HUD housing in the House of Representatives. It used to be called the Banking, Housing and Urban Affairs Committee, and they turned it into the Financial Services Committee. Well, it wasn’t just a name change. It meant something. When they took “housing” out of the name, they took housing out of their agenda, and they haven’t done much about housing ever since. Congressman Michael Oxley (R-OH) became Chairman and the jurisdiction of the Committee changed to incorporate additional securities and insurance jurisdiction. So there’s very little housing in that Committee any more, and it's a real shame because they still have jurisdiction over housing, both HUD housing and Rural Housing.
Slight Interest in LegislationThey did something on Rural Housing in Committee a couple weeks ago, a big surprise to many. They did a couple of little bills, one of which involves Habitat for Humanity self-help housing. And they added a multipage section which changed the name of the 502 Loan Guarantee Program to the Doug Bereuter Section 502 Single Family Housing Loan Guarantee Program. Congressman Bereuter (R-NE) is retiring, and he’s been very active in Rural Housing in the past and he was given the credit for fostering that program in 1990. As far as I know this is the first time in housing that a Member of Congress has gotten his name integrated into the statutory language of the program. It’s quite amazing.
Not that there’s anything wrong with it, but I would hate to see a lot of it just happening across the board. We do have things like the Roth IRA, which incorporates the name of Senator Roth in the IRA, but again we needed another name for those IRAs to distinguish them from the regular IRA, and so why not “Roth”? But I think we were doing quite fine with the 502 Loan Guarantee Program before the name change.
Now, we did have some discussions with Congressman Rick Renzi (R-AZ), who came to our Phoenix meeting in January. He was primarily interested in single-family housing, but we told him we were primarily a multifamily group. And he asked us to draft a proposal for him to introduce. We did so, we drafted a 515 Preservation program. But it turned out, you know, that he’s very concerned about getting re-elected. On the list of vulnerable Republicans, he’s probably No. 1. And his major constituency is Native Americans, so I think that although at some point he decided that he would like to take over Congressman Bereuter’s role as the No. 1 Rural Housing legislator, his first priority is to get re-elected. Thus doing something about 515 is not as important as doing something about Indian Housing.
So we gave him something that fell in our lap — there’s a HUD guarantee program for Indian tribe obligation bonds that are raised and used for housing on Indian reservations. The government had been guaranteeing these loans at 95%, this was the administrative number, and HUD and OMB decided that, well, we’ll save some money at the Indians’ expense and lower that guarantee to 85%. So Renzi comes in and he’s the savior of the Bill to put into the statute the guaranteed percentage of 95%. So that’s kind of the simple, straightforward legislation that is directed solely toward his major constituencies in his district. And that’s what he did instead of a much more complicated multi-family preservation program.
Advocate in Congress?Now if he gets re-elected, and he wants to assume a broader role as Republican successor to Congressman Bereuter, he might be more interested in doing something in the multifamily area, but that’s the way it is now. We certainly will market this proposal to other Congressmen who may be more secure in their Districts, and we hope we get some additional support in some other areas, but our flirtation with Rick Renzi did not develop as soon as we expected.
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