PRESS RELEASES
Rep. Royce Introduces Pay Back the Taxpayers Act to Prevent GSEs Funding Housing Advocacy GroupsToday, U.S. Representative Ed Royce (R-CA) will introduce the Pay Back the Taxpayers Act of 2015, legislation that prohibits Fannie Mae and Freddie Mac (GSEs) from diverting funds to the Housing Trust Fund and the Capital Magnet Fund in accordance with the Federal Housing Finance Agency’s (FHFA) interpretation of the Housing and Economic Recovery Act of 2008 (HERA): “We heard directly today from Fannie and Freddie’s regulator that while they remain under-capitalized and over-leveraged, it is the right time to start siphoning money away from these taxpayer-backed GSEs to questionable housing groups,” said Rep. Royce. “Anyone who witnessed the financial crisis knows exactly how this will play out. A larger government presence in housing distorts the market and promotes a boom-and-bust cycle that leaves taxpayers holding the bag. Coupled with the recent decision by the FHA to reduce mortgage premiums, it appears that the Administration is taking us in the complete wrong direction when it comes to stabilizing housing markets. The Pay Back the Taxpayers Act will preempt payments from the GSEs to housing advocacy groups and instead reroutes them where they belong: with the taxpayers.” Under current law, the FHFA is required to suspend allocations to the funds if such payments would: 1) contribute to the financial instability of the GSEs; 2) cause the GSES to be undercapitalized; or 3) prevent the GSEs from successfully completing a capital restoration plan. The Pay Back the Taxpayers Act removes any ambiguity under the law and states that no funds from Fannie and Freddie can be used to fund the national Housing Trust Fund while the GSEs are in conservatorship or receivership. In light of FHFA Director Mel Watt’s recent decision to reverse course on the funds’ capitalization, the bill includes a prohibition on any future transfers from the GSEs to the funds and will require any payments that have already been allocated or set aside be instead used to reduce the budget deficit. Rep. Royce questioned FHFA Director Mel Watt at today’s House Financial Services Committee hearing entitled “ Sustainable Housing Finance: An Update from the Director of the Federal Housing Finance Agency ” as to why he has directed the GSEs to fund these housing groups when the GSEs are over-leveraged and undercapitalized. Click to watch Rep. Royce’s questioning and Director Watt’s answers. Rep. Royce is a senior member of the House Financial Services Committee, with membership on both the Capital Markets and Government Sponsored Enterprises Subcommittee and the Housing and Insurance Subcommittee. |
http://royce.house.gov/news/documentsingle.aspx?DocumentID=397628
∼113H3901 …………………………………………………………… (Original Signature of Member) 114TH CONGRESS 1ST SESSION H. R. ll To prohibit contributions by Fannie Mae and Freddie Mac to the Housing Trust Fund and the Capital Market Fund while such enterprises are in conservatorship or receivership, and for other purposes. IN THE HOUSE OF REPRESENTATIVES Mr. ROYCE introduced the following bill; which was referred to the Committee on llllllllllllll A BILL To prohibit contributions by Fannie Mae and Freddie Mac to the Housing Trust Fund and the Capital Market Fund while such enterprises are in conservatorship or receivership, and for other purposes. 1 Be it enacted by the Senate and House of Representa- 2 tives of the United States of America in Congress assembled, 3 SECTION 1. SHORT TITLE. 4 This Act may be cited as the ‘‘Pay Back the Tax- 5 payers Act of 2015’’. VerDate Nov 24 2008 11:14 Jan 27, 2015 Jkt 000000 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 C:\USERS\PCCALLEN\APPDATA\ROAMING\SOFTQUAD\XMETAL\7.0\GEN\C\ROYCE_~1. January 27, 2015 (11:14 a.m.) F:\M14\ROYCE\ROYCE_016.XML f:\VHLC\012715\012715.044.xml (590566|7)2 1 SEC. 2. PROHIBITION OF CONTRIBUTIONS TO HOUSING 2 TRUST FUND AND CAPITAL MAGNET FUND 3 WHILE ENTERPRISES ARE IN CONSERVATOR- 4 SHIP OR RECEIVERSHIP. 5 (a) IN GENERAL.—Notwithstanding section 1337 of 6 the Federal Housing Enterprises Financial Safety and 7 Soundness Act of 1992 (12 U.S.C. 4567) or any other 8 provision of law, after the date of the enactment of this 9 Act, the Federal National Mortgage Association and the 10 Federal Home Loan Mortgage Corporation shall not, dur- 11 ing the term of any conservatorship or receivership of such 12 an enterprise pursuant to section 1367 of such Act (12 13 U.S.C. 4617), make any contribution or transfer to, or 14 allocate or set aside any amounts for, the Housing Trust 15 Fund established under section 1338 of such Act (12 16 U.S.C. 4568) or the Capital Magnet Fund established 17 under section 1339 of such Act (12 U.S.C. 4569). 18 (b) TREATMENT OF AMOUNTS PREVIOUSLY SET 19 ASIDE.—Any amounts that, before the date of the enact- 20 ment of this Act, have been set aside by the Federal Na- 21 tional Mortgage Association or the Federal Home Loan 22 Mortgage Corporation for the Housing Trust Fund or the 23 Capital Magnet Fund referred to in subsection (a) of this 24 section but not yet allocated or transferred to such a Fund 25 shall not be so allocated or transferred but shall be covered 26 into the General Fund of the Treasury and shall be used VerDate Nov 24 2008 11:14 Jan 27, 2015 Jkt 000000 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 C:\USERS\PCCALLEN\APPDATA\ROAMING\SOFTQUAD\XMETAL\7.0\GEN\C\ROYCE_~1. January 27, 2015 (11:14 a.m.) F:\M14\ROYCE\ROYCE_016.XML f:\VHLC\012715\012715.044.xml (590566|7)3 1 only for reducing the budget deficit of the Federal Govern- 2 ment. 3 SEC. 3. USE OF ENTERPRISE REPAYMENTS TO REDUCE 4 BUDGET DEFICIT. 5 After the date of the enactment of this Act, any 6 amounts paid or repaid to the Secretary of the Treasury 7 by the Federal National Mortgage Association or the Fed- 8 eral Home Loan Mortgage Corporation, during the term 9 of any conservatorship or receivership of such enterprise 10 pursuant to section 1367 of such Act (12 U.S.C. 4617) 11 and in any form, including any dividends paid pursuant 12 to the Amended and Restated Senior Preferred Stock Pur- 13 chase Agreements, dated September 26, 2008, amended 14 May 6, 2009, further amended December 24, 2009, and 15 further amended August 17, 2012, between the United 16 States Department of the Treasury and the Federal Na- 17 tional Mortgage Association, and between such Depart- 18 ment and the Federal Home Loan Mortgage Corporation, 19 shall be covered into the General Fund of the Treasury 20 and shall be used only for reducing the budget deficit of 21 the Federal Government. VerDate Nov 24 2008 11:14 Jan 27, 2015 Jkt 000000 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 C:\USERS\PCCALLEN\APPDATA\ROAMING\SOFTQUAD\XMETAL\7.0\GEN\C\ROYCE_~1. January 27, 2015 (11:14 a.m.) F:\M14\ROYCE\ROYCE_016.XML f:\VHLC\012715\012715.044.xml (590566|7)
http://royce.house.gov/uploadedfiles/pay_back_the_taxpayers_act_of_2015.pdf