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Congressman Capuano's
An update from the office of U.S. Representative Michael E. Capuano
7th Congressional District of Massachusetts

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February 7, 2013

Deficit Reduction

As yet another federal budget related deadline approaches, it’s important to point out that in the past two years, total debt reduction amounts to approximately $2.4 trillion. This has happened primarily as a result of spending cuts. Many programs have already endured significant cuts, and more are coming. As a result of this focus on cutting the budget, federal discretionary spending is already on track to be at its lowest level in more than 50 years. Appropriations Committee Democrats have issued a report on the impact of reduced federal spending. It details just how severely all of the cuts are impacting a whole host of federal programs.

Dozens of federal education programs have been completely eliminated in the past two years and many more significantly impacted. For example, grants supporting schools’ efforts to reduce class sizes have been cut by 16%. Grants supporting safe schools and youth violence prevention have been hit even harder, with a 66% reduction in funding. Department of Justice grants for state and local law enforcement efforts are down 41% from FY 2010 to FY 2012.

Our cities and towns are also struggling with budget challenges and reduced federal spending places a greater burden on local budgets. The Community Development Block Grant (CDBG) is down 26% from FY 2010 to FY 2012. CDBG funds are used by municipalities for water and sewer work, housing initiatives, economic development and so much more. Without these funds, communities will have fewer resources to address local needs. The Low Income Home Energy Assistance Program (LIHEAP) was cut by 32% from FY 2010 to FY 2012. This is money that low-income residents rely on to heat their homes in the winter.

All of these cuts have gone into effect before sequestration is even factored in. If sequestration is not turned off, the impact will be even more devastating. I have included a link to the report if you are interested in learning more.

Recent Votes

This week the House considered H.R. 444: Require a Plan D Act. This bill requires the President to submit a balanced FY 2014 budget. If that budget is not balanced, H.R. 444 requires that a supplemental budget be submitted by April 1st identifying in which Fiscal Year a balanced budget is anticipated and how that balance would be achieved. It’s worth noting that the budget proposed by Rep. Paul Ryan which passed in the House two years in a row did not balance until after 2030. H.R. 444 also includes unnecessary language that places the blame for the deficit entirely on President Obama. The Senate won’t consider H.R. 444 so this bill is going nowhere.

Another budget deadline is looming. On March 1st, the sequestration that was delayed with a vote on New Year’s Day is scheduled to go into effect unless Congress acts. With a little over three weeks to go, that is what the House should be focusing on, working to prevent sequestration with a balanced plan. H.R. 444 does absolutely nothing to address our immediate fiscal challenges. In fact, House Republicans did not even allow an amendment that would have addressed sequestration, offered by House Democrats, to be considered for a vote. I voted NO. H.R. 444 passed and the entire vote is recorded below:





















Federal Housing Administration

On Wednesday the House Financial Services Committee held a hearing on the Federal Housing Administration (FHA). We heard from academics and experts about the FHA’s role in our housing market. FHA was established in 1934 after the Great Depression to insure home loans made by private lenders to help broaden homeownership. For nearly 80 years, the FHA has been a self-funded agency. The premiums paid by homeowners for FHA mortgage insurance are used to run the agency and cover future losses when loans default. Because of the FHA, a 30-year fixed-rate mortgage is considered a standard home loan. This has been an integral part of creating our middle class. To date, the FHA has insured over 41 million mortgages.

Since the financial crisis, lenders have turned to the FHA to insure loans because much of the private market dried up. Today the FHA faces extensive losses from defaults on loans made during the economic downturn. In November, the FHA released its annual actuarial report which showed capital reserve levels in the negative and noted that it may have to use its borrowing authority for the first time.

As the Ranking Member of the Financial Services Committee’s Subcommittee on Housing and Insurance, I am deeply concerned about the FHA’s books and am committed to making further reforms so the FHA can to continue safely provide mortgage credit. To date, the FHA has adopted over a dozen policy changes to strengthen its finances.

Members and witnesses at the hearing expressed opinions about the size of the FHA’s role in our housing market. Discussion involved whether the FHA should be restricted to helping a narrower segment of borrowers, and if FHA has followed its mission. While I am open to discussing the details of FHA programming, we must recognize how many homeowners the FHA has already assisted. It is also important to note that a number of reforms have already been implemented and others are awaiting Congressional approval. I am not interested in simply pulling up the ladder behind me, limiting access to affordable home mortgages and putting homeownership out of reach for so many. I expect an examination of the FHA’s role in our housing market to continue as the committee plans additional hearings.

Chelsea United Against The War

I met this week with Chelsea Uniting Against the War, a group of activists who are concerned about military spending and the underfunding of crucial domestic needs. They want to protect Social Security, Medicare, and other vital programs as well as invest in job creation. They are concerned too about preserving the constitutional separation of powers and thanked me for insisting that the President should have sought Congressional authorization for US actions in Libya. I thanked the group for their activism. I also encouraged them to broaden their efforts and reach out to like-minded groups.

What’s Up Next

The House will consider legislation that continues the freeze on federal employee pay. Next votes will occur on Tuesday February 12th.


Congressman Mike Capuano
7th District, Massachusetts
Committee on Transportation and Infrastructure
Committee on Financial Services

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