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photo of Mike Capuano Michael E. Capuano representing the 7th district of Massachusetts in the U.S. House of Representatives Go to the House of Representatives homepage
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Printer-friendly web page: Mike on Housing and Financial Services


Mike on Housing and Financial Services


The lack of affordable housing is a chronic problem in the Greater Boston area. This is the case whether someone is a buyer or a renter. I have been fighting to ease this burden throughout my time in Congress. My focus continues to be on preserving existing affordable housing and fully funding current housing programs, such as Section 8 and Community Development Block Grants (CDBG). I am also committed to ensuring that homeownership is accessible and affordable.

Late in 2014, the Federal Housing Finance Agency announced that it would allow Fannie Mae and Freddie Mac to begin making contributions to the National Housing Trust Fund, something I had been working on for years.

Agencies that provide homeownership opportunities, such as Fannie Mae, Freddie Mac and the Federal Housing Administration, must be strengthened and improved. This is why I have advocated strongly that Fannie and Freddie must be allowed to rebuild their capital buffers, now that they have more than fully repaid the taxpayer funds they received during the crisis. . At the same time, it is absolutely imperative that as we reform these programs, we preserve affordable access to 30-year fixed-rate loans. This will help preserve our middle-class and allow future generations to benefit from home ownership.

I have fought for years to ensure that multi-family homes, such as those commonly found in the 7th district, are treated the same as more traditional single family homes. For example, I worked to expand the number of qualified Massachusetts citizens eligible for federally-backed home loans by increasing loan limits for single-family dwellings and for 2, 3, and 4 family homes. I have worked to ensure that Massachusetts' high cost of housing is taken into account when determining qualifications for assistance and mortgage loans.

When Congress passed the Helping Families Save their Homes Act, I worked hard to include a tenant protection provision which requires a 90-day notice before tenants have to leave a foreclosed home.

Financial Services

As a member of the House Financial Services Committee, I have worked on a whole host of issues. I am proud of our Committee’s work responding to the financial crisis and passing the Dodd-Frank Wall Street Reform & Consumer Protection Act in 2010. The worst economic crisis since the Great Depression required a sweeping response, and this historic measure was a significant step in reining in big financial firms. It created new, robust financial regulations, increased investor protections and established the first consumer financial protection agency.

The reforms of this law are at risk under the Trump Administration. The committee has already advanced legislation that will roll back many of the Dodd-Frank provisions.

The Wall Street Reform and Consumer Protection Act increases transparency so we are better equipped to see and respond to financial problems before they get out of control. Two important provisions of mine which were included in the law: increasing the liability and accountability of credit rating agencies and requiring the registration of hedge funds with federal regulators.

In the 112th Congress, I served as Ranking Member of the Oversight & Investigation Subcommittee. The Subcommittee oversaw the setup of several new agencies created under the Wall Street Reform Act, including the Consumer Financial Protection Bureau (CFPB), and reviewed several existing federal programs. The Subcommittee also investigated the failure of MF Global, which led to a report and a Democratic response laying out specific regulatory recommendations for the future. I introduced several pieces of legislation to effectuate the recommendations of the trustee for the liquidation of MF Global, some of which have been adopted by regulators. Beginning in 2015, the Financial Accounting Standards Board required all repurchase-to-maturity transactions to be reported on a company’s balance sheet.

I remain concerned about the outsized role played in our economy by some of our largest financial institutions. While the Dodd-Frank Act has offered many important steps to address the “too big to fail” problem, the market is not wholly convinced that taxpayer money will not be needed if the financial system is impacted the way it was in 2008. This is why I have continued to file the Subsidy Reserve Act. It would require the Federal Reserve to quantify the implicit subsidy from which the biggest financial institutions benefit, such as lower cost funding provided by equity and debt investors based on the expectation that the government would rescue a TBTF firm rather than allow it to fail. My legislation would require institutions to maintain a level of capital commensurate with the size of this subsidy which could only be tapped in the event of a crisis.

Due to my concern over TBTF institutions I also filed the 21st Century Glass Steagall Act which would shield federally insured deposit-taking banks from risker financial institutions such as investment banks and swaps dealers. Congress passed the Glass-Steagall Act in the wake of the 1929 economic crash to create a wall between investment banks and depository banks. The 1999 Gramm-Leach-Bliley Act repealed many of its core provisions. In its report on the 2008 financial crisis, the Financial Crisis Inquiry Commission concluded that, “this deregulation made the financial system especially vulnerable to the financial crisis and exacerbated its effects.”

Since 2007, I have been the chief sponsor of legislation to extend needed terrorism insurance to businesses, especially those in major urban areas. The Terrorism Risk Insurance Program Reauthorization Act makes terrorism insurance available and affordable in the wake of 9/11. The program has been extended several times, most recently in early 2015.

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