[House Hearing, 118 Congress]
[From the U.S. Government Publishing Office]



                               MEMBER DAY

=======================================================================

                                HEARING

                               BEFORE THE

                    COMMITTEE ON FINANCIAL SERVICES

                     U.S. HOUSE OF REPRESENTATIVES

                    ONE HUNDRED EIGHTEENTH CONGRESS

                             FIRST SESSION

                               __________


                            NOVEMBER 9, 2023

                               __________

       Printed for the use of the Committee on Financial Services

                           Serial No. 118-56





               [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]






                               ______
                                 

                 U.S. GOVERNMENT PUBLISHING OFFICE

55-024 PDF                WASHINGTON : 2024










                 HOUSE COMMITTEE ON FINANCIAL SERVICES

               PATRICK McHENRY, North Carolina, Chairman

FRANK D. LUCAS, Oklahoma             MAXINE WATERS, California, Ranking 
PETE SESSIONS, Texas                     Member
BILL POSEY, Florida                  NYDIA M. VELAZQUEZ, New York
BLAINE LUETKEMEYER, Missouri         BRAD SHERMAN, California
BILL HUIZENGA, Michigan              GREGORY W. MEEKS, New York
ANN WAGNER, Missouri                 DAVID SCOTT, Georgia
ANDY BARR, Kentucky                  STEPHEN F. LYNCH, Massachusetts
ROGER WILLIAMS, Texas                AL GREEN, Texas
FRENCH HILL, Arkansas, Vice          EMANUEL CLEAVER, Missouri
    Chairman                         JIM A. HIMES, Connecticut
TOM EMMER, Minnesota                 BILL FOSTER, Illinois
BARRY LOUDERMILK, Georgia            JOYCE BEATTY, Ohio
ALEXANDER X. MOONEY, West Virginia   JUAN VARGAS, California
WARREN DAVIDSON, Ohio                JOSH GOTTHEIMER, New Jersey
JOHN ROSE, Tennessee                 VICENTE GONZALEZ, Texas
BRYAN STEIL, Wisconsin               SEAN CASTEN, Illinois
WILLIAM TIMMONS, South Carolina      AYANNA PRESSLEY, Massachusetts
RALPH NORMAN, South Carolina         STEVEN HORSFORD, Nevada
DAN MEUSER, Pennsylvania             RASHIDA TLAIB, Michigan
SCOTT FITZGERALD, Wisconsin          RITCHIE TORRES, New York
ANDREW GARBARINO, New York           SYLVIA GARCIA, Texas
YOUNG KIM, California                NIKEMA WILLIAMS, Georgia
BYRON DONALDS, Florida               WILEY NICKEL, North Carolina
MIKE FLOOD, Nebraska                 BRITTANY PETTERSEN, Colorado
MIKE LAWLER, New York
ZACH NUNN, Iowa
MONICA DE LA CRUZ, Texas
ERIN HOUCHIN, Indiana
ANDY OGLES, Tennessee

                     Matt Hoffmann, Staff Director









                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on:
    November 9, 2023.............................................     1
Appendix:
    November 9, 2023.............................................    27

                               WITNESSES
                       Thursday, November 9, 2023

Auchincloss, Hon. Jake, a Representative in Congress from the 
  State of Massachusetts.........................................     6
Beatty, Hon. Joyce, a Representative in Congress from the State 
  of Ohio........................................................    12
Cleaver, Hon. Emanuel, a Representative in Congress from the 
  State of Missouri..............................................    11
Garcia, Hon. Sylvia R., a Representative in Congress from the 
  State of Texas.................................................    14
Gonzalez, Hon. Vicente, a Representative in Congress from the 
  State of Texas.................................................    18
Green, Hon. Al, a Representative in Congress from the State of 
  Texas..........................................................    10
Kilmer, Hon. Derek, a Representative in Congress from the State 
  of Washington..................................................     4
Lamborn, Hon. Doug, a Representative in Congress from the State 
  of Colorado....................................................    15
Pettersen, Hon. Brittany, a Representative in Congress from the 
  State of Colorado..............................................    16
Rutherford, Hon. John H. a Representative in Congress from the 
  State of Florida...............................................     3
Sherman, Hon. Brad, a Representative in Congress from the State 
  of California..................................................    21
Tlaib, Hon. Rashida, a Representative in Congress from the State 
  of Michigan....................................................    23
Williams, Hon. Nikema, a Representative in Congress from the 
  State of Georgia...............................................    20

                                APPENDIX

Prepared statements:
    Auchincloss, Hon. Jake.......................................    28
    Beatty, Hon. Joyce...........................................    30
    Cleaver, Hon. Emanuel........................................    32
    Cole, Hon. Tom...............................................    35
    Garcia, Hon. Sylvia R........................................    37
    Gonzalez, Hon. Vicente.......................................    44
    Green, Hon. Al...............................................    47
    Kilmer, Hon. Derek...........................................    49
    Lamborn, Hon. Doug...........................................    53
    Pettersen, Hon. Brittany.....................................    55
    Rutherford, Hon. John H......................................    58
    Sherman, Hon. Brad...........................................    61
    Tlaib, Hon. Rashida..........................................    67
    Wexton, Hon. Jennifer........................................    69
    Williams, Hon. Nikema........................................    71










 
                               MEMBER DAY

                               ----------                              


                       Thursday, November 9, 2023

             U.S. House of Representatives,
                   Committee on Financial Services,
                                                   Washington, D.C.
    The committee met, pursuant to notice, at 9:04 a.m., in 
room 2128, Rayburn House Office Building, Hon. Patrick McHenry 
[chairman of the committee] presiding.
    Members present: Representatives McHenry; Waters, Sherman, 
Green, Cleaver, Beatty, Gonzalez, Tlaib, Garcia, Williams of 
Georgia, and Pettersen.
    Also present: Representatives Auchincloss, Kilmer, Lamborn, 
and Rutherford.
    Chairman McHenry. The Financial Services Committee will 
come to order.
    Without objection, the Chair is authorized to declare a 
recess of the committee at any time.
    Today's hearing is entitled, ``Member Day.'' We got 
creative with the title.
    And I would like to note that we will have three panels of 
witnesses today to accommodate Members. We will receive 
testimony from the first panel and conduct Q&A, and then we 
will move on to our second panel, receive testimony from them, 
and so on.
    [Text of all of the bills referenced in this hearing can be 
found on the committee website, http://
financialservices.house.gov/calendar]
    I will now recognize myself for 5 minutes to give an 
opening statement.
    Good morning. I wanted to welcome all of you to the 
Committee Member Day hearing for the 118th Congress. Today's 
hearing is an opportunity for lawmakers across the House, 
regardless of their committee assignment, to engage with 
legislation that falls under our jurisdiction here at the 
Financial Services Committee. We have a nice panel to start 
off, with one former Member of the committee, Mr. Auchincloss, 
but everybody has an opinion across the wide view of what we do 
as legislators, and we want to hear from all Members about 
their feedback.
    In today's ever-evolving economic and geopolitical 
landscape, the challenges that America faces are growing more 
and more complex. In many instances, these challenges require 
multidisciplinary solutions to ensure a robust legislative 
response. With that in mind, we welcome the unique point of 
view of Members from both sides of the aisle. Your work in 
other fields will help to inform Members of this committee when 
crafting legislation in response to the issues discussed here 
today.
    On October 7th, we saw a barbaric and unjustified attack on 
innocent Israeli civilians perpetrated by the Iran-backed 
terrorist group, Hamas. This has prompted Members from across 
the Congress to consider ways in which the United States can 
prevent Iranian financial aid from reaching its proxies. 
Another foreign threat is in the form of the Chinese Communist 
Party (CCP), and they have garnered attention from Members of 
Congress. We must work to combat the CCP, which engages in 
genocide, facilitates the flow of deadly fentanyl into our 
communities, and seeks to outcompete and ultimately replace 
American global preeminence.
    Domestically, we have failed. Progressive economic policies 
have threatened the financial security of families across the 
nation and have driven up the cost of goods and services as 
Americans race to keep pace amidst stagnating real wages. All 
of this is against the backdrop of financial regulators who 
have taken their eyes off the ball. Repeatedly, we have seen 
Biden appointees overstep their mandates to institute 
rulemakings that disregard congressional intent and weaken our 
global competitiveness instead of focusing on the safety and 
soundness of our financial institutions and our financial 
system.
    In conclusion, our nation faces many challenges, and this 
committee is constantly looking for thoughtful ways to meet 
them. As I have said since I became chairman, my door is always 
open. Please come to me with any ideas and any feedback. I 
can't promise we will always agree, but we will find common 
ground wherever we possibly can, and I am committed to trying 
to work together on every issue across-the-board.
    We welcome the testimony of those appearing before the 
committee today in service of these goals, and I thank them for 
taking the time to be here with us to share their ideas.
    And with that, I yield back, and I recognize the ranking 
member of the committee, Ms. Waters, for 5 minutes.
    Ms. Waters. Thank you very much, Mr. Chairman. I am pleased 
to be here with you today, but I am reminded that we are 8 days 
away from a government shutdown, and I and my colleagues on 
this side of the aisle are trying desperately to find a path 
toward ensuring that critical Federal agencies, like HUD and 
the SEC, aren't completely shuttered, and that our hardworking 
servicemembers and government employees get their paychecks, 
and that during the crisis in the Middle East, we are able to 
safeguard our interests and support our allies.
    Let's start with housing. Today, nearly 600,000 people are 
experiencing homelessness, and millions more are one crisis 
away from eviction or foreclosure, all while rent and housing 
prices continue to skyrocket. This is a crisis with no end in 
sight. So this issue, along with many other issues that we are 
dealing with, really have to be addressed in the best way that 
we possibly can. And we are here today to hear from our 
colleagues with, not questions, but advice in helping us to 
understand what their concerns are and what they need to do for 
their jurisdictions.
    I mentioned, housing, and I would like to say that 
Democrats are certainly taking the housing and homelessness 
crisis very seriously, and when I was Chair, I held 55 hearings 
on housing. Committee Democrats also worked to pass substantial 
emergency housing funding during the pandemic. And as ranking 
member, I have introduced several affordable housing bills, 
including my Housing Crisis Response Act, which would finally 
make the investments needed to build 1.4 million homes and help 
homelessness and revive the dream of homeownership for all.
    Now, on diversity and inclusion, after Republicans assumed 
the Majority, we lost the Diversity and Inclusion Subcommittee 
that I created. And as we have looked at the ways that the 
budget has been handled by my friends on the opposite side of 
the aisle, almost every area of government has been stripped of 
any thought of diversity and inclusion, so I want you to know 
that is a serious issue with which we must deal.
    These are just a few of the key issues that have not been 
addressed, and I look forward to hearing from all of my 
colleagues today about these and other issues and legislation 
that deserve to be addressed by this committee. I yield back.
    Chairman McHenry. The ranking member yields back. We will 
now recognize our distinguished first panel: the Honorable John 
Rutherford of the State of Florida; the Honorable Derek Kilmer 
of the State of Washington; and the Honorable Jake Auchincloss 
of the State of Massachusetts. We thank each of you for being 
here. Each of you will be recognized for 5 minutes to give an 
oral summary of your presentation, and without objection, your 
written statements will be made a part of the record.
    Mr. Rutherford, we will begin with you.

STATEMENT OF THE HONORABLE JOHN H. RUTHERFORD, A REPRESENTATIVE 
             IN CONGRESS FROM THE STATE OF FLORIDA

    Mr. Rutherford. Thank you, Mr. Chairman, and I thank 
Ranking Member Waters and the other members of the----
    Chairman McHenry. Mr. Rutherford, we will reset the time. 
You have to pull the microphone pretty close to you. The 
acoustics in here are terrible, and as a member of the 
Appropriations Committee, I would flag that for your 
consideration to improve the sound system, because it is 
atrocious. I have long hated it, and I thank you for the 
opportunity to vent a little bit.
    So, Mr. Rutherford, we will begin with you again, but 
please be sensitive to the terrible microphone.
    Mr. Rutherford. Okay. Thank you again for this opportunity 
to speak on my bill, H.R. 3170, the bipartisan, bicameral, 
Homes for Every Local Protector, Educator, and Responder Act, 
also known as the HELPER Act.
    I can tell you that high home prices and high interest 
rates have made homeownership almost out of reach for many of 
our first responders and teachers around the country. The 
HELPER Act would address this by creating a one-time use for a 
home loan program through FHA for law enforcement officers, 
firefighters, EMTs, paramedics, and pre-K through 12 teachers 
who are first-time homebuyers only. Modeled after the 
successful VA Home Loan Program, this bill would remove some of 
the steepest financial obstacles that these public servants 
face when trying to purchase a home, such as the large down 
payment and the monthly mortgage insurance premium. The HELPER 
Act also includes an up-front mortgage insurance premium to 
ensure the solvency of this program, and a 5-year sunset so 
that the program can be thoroughly evaluated.
    Not only would the HELPER Act help these public servants 
live in the communities where they serve, it would create a 
much-needed recruitment and retention tool. I can tell you that 
since the riots of 2020, retirements are up and recruiting is 
down in the field of law enforcement, and that is a recipe for 
disaster. As a former sheriff, I understand how important it is 
for law enforcement officers to live in the communities that 
they protect, and when our officers become part of the 
community that they serve, morale goes up, safety improves, and 
bonds between the community and the police are enhanced.
    The HELPER Act has received the support of numerous 
organizations, and I will read just a few: the Fraternal Order 
of Police, the Major County Sheriffs of America, the Major 
Cities Chiefs Association, the International Association of 
Firefighters, the International Association of EMTs and 
Paramedics, the American Federation of Teachers, the National 
Association of Federally-Insured Credit Unions, and the 
National Association of REALTORS. Additionally, the HELPER Act 
has been endorsed by more than 130 elected officials around the 
country, including 14 mayors just from the State of North 
Carolina.
    The HELPER Act has 97 bipartisan co-sponsors in the House, 
and 13 in the Senate, where it is led by Senators Rubio, 
Ossoff, and Brown. And I would like to extend a special thanks 
to the 10 bipartisan members of this committee who have also 
co-sponsored the bill already--I really do appreciate that--and 
include Representative Watson Coleman, who is my primary co-
lead on this.
    On behalf of the thousands of first responders and teachers 
across this nation, I humbly ask for this committee's full and 
fair consideration of the HELPER Act. I yield back.
    [The prepared statement of Representative Rutherford can be 
found on page 58 of the appendix.]
    Chairman McHenry. The gentleman yields back. We will now 
recognize Mr. Kilmer for 5 minutes.

 STATEMENT OF THE HONORABLE DEREK KILMER, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF WASHINGTON

    Mr. Kilmer. Thank you, Chairman McHenry and Ranking Member 
Waters, for holding this hearing today. I am here to bring two 
housing bills to your attention. As we find ourselves in the 
midst of a housing affordability crisis, recent research 
underscores the urgency of the situation. Residential 
construction fell 7.3 million units short between 2000 and 
2015. Research from Up For Growth, an organization committed to 
solving the housing shortage and affordability crisis through 
evidence-based policy, identified housing costs as the leading 
factor contributing to the rise in household budgets over the 
past 15 years.
    There is not a single State, there is not a single 
congressional district with enough housing supply to meet 
demand, and that reality pushes dreams of homeownership out of 
reach for far too many Americans, and we have to fix it. 
Addressing the nation's housing crisis is a complex challenge, 
but experts agree that restrictive zoning and land use policies 
are part of the problem, and as a result, Representative Flood 
and I introduced the bipartisan, bicameral, Yes In My Backyard 
Act (YIMBY Act), which has been referred to your committee.
    The YIMBY Act ensures Community Development Block Grant 
(CDBG) Program recipients report on policies that may affect 
housing affordability. Specifically, the bill would require 
recipients of CDBG funding to track and report on the 
implementation of certain land use policies that promote 
housing production, such as enacting high-density, single-
family and multi-family zoning; addressing height limitations; 
and encouraging and reducing minimum lot size. Recognizing that 
CDBG funds are critical for localities, the bill seeks to 
encourage local governments and CDBG practitioners to work 
together to address severe housing underproduction and to 
improve the lives of families and individuals who are 
negatively impacted by a lack of affordable housing.
    We count many of your committee members among our 
bipartisan co-sponsors. Dozens of groups from across the 
political spectrum are with us on this bill, too, from 
Americans for Prosperity, to the National Apartment 
Association, to the National Association of REALTORS, and the 
National Low Income Housing Coalition, and more. This bill 
passed under suspension in the 116th Congress, and we want to 
work with you to see it over the finish line in this Congress.
    The second bill I want to bring to your attention is called 
the VALID Act. It, too, is bipartisan and bicameral, and it 
focuses on housing affordability specifically for our nation's 
veterans. My district is home to a large number of active-duty 
servicemembers and veterans, and we all know that our nation is 
stronger and our world is safer, as we approach Veterans Day, 
because of their service and their sacrifice. One important way 
we can honor their sacrifice is by ensuring those who served 
can achieve their dream of one day owning a home.
    VA home loans can offer veterans, active-duty 
servicemembers, reservists, and National Guard members 
advantages over other loan options, including lower down 
payments, more favorable interest rates, and low closing costs, 
often saving tens of thousands of dollars over the life of the 
loan. Despite these benefits, overall usage of VA home loans is 
surprisingly low, with only 10 to 15 percent of veterans 
annually reported as using the benefit. Providing a simple 
update to the U.S. Department of Housing and Urban 
Development's already-existing Informed Consumer Choice 
Disclosure Notice will help close that loop and ensure veterans 
and servicemembers are aware of their hard-earned VA loan 
benefit. Specifically, the bill will add VA home loans to the 
current disclosure form that lenders must provide to 
prospective homebuyers, which right now only compares 
conventional and FHA loan options.
    Like the YIMBY Act, several members of your committee have 
co-sponsored this bill, and it is supported by stakeholder 
organizations, including the Veterans Association of Real 
Estate Professionals, Veterans United Home Loans, the Military 
Officers Association of America, the National Association of 
REALTORS, and the Veterans of Foreign Wars.
    Mr. Chairman, thank you again for your time and your 
leadership on these issues. I look forward to working with you 
to hopefully move these critical pieces of legislation forward. 
I yield back.
    [The prepared statement of Representative Kilmer can be 
found on page 49 of the appendix.
    Chairman McHenry. Thank you, Mr. Kilmer.
    Mr. Kilmer. Thank you.
    Chairman McHenry. And we will now recognize Mr. Auchincloss 
for 5 minutes.

 STATEMENT OF THE HONORABLE JAKE AUCHINCLOSS, A REPRESENTATIVE 
          IN CONGRESS FROM THE STATE OF MASSACHUSETTS

    Mr. Auchincloss. I appreciate Chairman McHenry and Ranking 
Member Waters for holding a Member Day hearing in the Financial 
Services Committee. I would like to take this opportunity to 
talk about two of the bills I have introduced this Congress 
over which the Financial Services Committee has jurisdiction: 
the Power of the Mint Act; and the Promoting New and Diverse 
Depository Institutions Act.
    Article I, Section 8 of the Constitution states that 
Congress has the power to, ``coin money, regulate the value 
thereof and of foreign coin, and fix the standard of weights 
and measures.'' This constitutional mandate extends to 
authorizing both retail and wholesale central bank digital 
currencies (CBDCs). While the Federal Reserve has recognized 
that it lacks the authority to issue a CBDC without 
congressional authorization, the Department of Justice has so 
far refused to issue a legal opinion to that effect. It is 
therefore imperative that Congress assert our constitutional 
prerogative.
    The U.S. dollar has been the world's reserve currency since 
the end of World War II. The rule of law is critical for the 
United States dollar to continue in this status. Issuing a CBDC 
without congressional assent would undermine the rule of law 
and, thus, the United States' geoeconomic standing, more than 
any purported and unproven benefits of a CBDC would enhance it.
    The Power of the Mint Act does not prohibit the Federal 
Reserve or the Department of the Treasury from conducting 
research and development or being involved in international 
consultations on standard setting regarding CBDCs. It simply 
asserts Congress' constitutional duty to authorize the minting 
of money. Representative Hill has been a capable co-lead and 
partner on this bill. I am grateful for his collaboration, and 
I hope to work with the committee to move this bill forward.
    Our economy has not always worked for all communities 
equally, as is evident in the glaring wealth disparities across 
the country. One way to address inequities is to ensure 
Americans have access to diverse and affordable financial 
services that can help them save money and help small 
businesses raise capital. I introduced the Promoting New and 
Diverse Depository Institutions Act to move our financial 
system closer to economic equality. This bipartisan bill 
requires that the prudential regulators come up with a 
strategic plan to help reduce the barriers that new depository 
institutions face when applying for a bank charter. This bill 
specifically calls for the strategic plan to take into 
consideration the challenges faced by de novo financial 
institutions, including minority depository institutions 
(MDIs), and community development financial institutions 
(CDFIs).
    Consumers should have access to affordable banking 
services, which requires competition in the market. Over the 
last several decades, there has been consolidation among banks 
and credit unions. This has effectively limited the products 
available to consumers and artificially driven up costs while 
closing banking branches for people who already did not have 
many choices. My bill will help new banks, and in doing so, it 
will expand access to affordable services for unbanked 
communities.
    Starting and maintaining a new bank or credit union is a 
difficult process. According to the Federal Reserve, only 7 new 
banks were formed between 2009 and 2013. Based on the 
decreasing number of new banks, Congress must act to direct 
banking regulators to measure and mitigate the challenges new 
banks face. This study will inform future steps that Congress 
can take to expand competition and access for consumers. I am 
pleased to have Chairman McHenry as a co-sponsor of this bill. 
The bill passed the House twice last Congress. There is a 
bipartisan Senate companion, and I ask this committee to 
expeditiously move this bill so that we can help unbanked 
communities and expand banking access to our constituents.
    And finally, I want to call this committee's continued 
attention to, and add my emphasis to. the need to expand the 
Low-Income Housing Tax Credit (LIHTC) program. This has been a 
bipartisan success over the last decades. In my home State of 
Massachusetts, the lack of affordable housing is the single 
biggest problem that we face. It is suffocating the ability of 
our economy to reach its full potential, it is preventing young 
families from gaining a foothold, and it is causing panic 
amongst our senior population. The Affordable Housing Credit 
Improvement Act would expand the LIHTC program in a measured 
and thoughtful way, and I would encourage legislators of this 
committee to give it serious consideration.
    I thank the chairman and the ranking member for the 
opportunity to testify and respectfully urge the committee to 
support and advance the Power of the Mint Act and the Promoting 
New and Diverse Depository Institutions Act. Thank you.
    [The prepared statement of Representative Auchincloss can 
be found on page 28 of the appendix.]
    Chairman McHenry. Thank you. I will now recognize myself 
for 5 minutes.
    I want to thank this bipartisan panel for all proposing 
bipartisan solutions. It is a welcome acknowledgment of the 
situation we find ourselves in, in a divided government, which 
means we have to work together to achieve legislative results, 
but particularly with policy. To have enduring policy, we have 
to have policy that meets some metrics for both parties and has 
a wide cross-section of Congress that can support those 
initiatives. So, I want to thank each of you for bringing 
proposals that are squarely within the Financial Services 
Committee's jurisdiction and are things we should address.
    Housing affordability is clearly one, and that is a running 
theme from all three of the Members testifying today, and I 
want to thank you for that emphasis and focus. And, Mr. 
Auchincloss, I want to thank you for your work on de novo 
institutions. It is a work of financial inclusion that is much 
needed, whether it is in Massachusetts or North Carolina or 
wherever you may be in the United States, so thank you for your 
leadership there.
    And with that, I yield back and now recognize the ranking 
member for 5 minutes.
    Ms. Waters. Thank you so very much, Mr. Chairman, and I 
would like to thank all of our witnesses, our colleagues who 
are here this morning indicating what they care about and the 
kind of work that they are doing. I am very appreciative for 
that.
    But, Mr. Rutherford, I would like to ask you a little bit 
about your bill, the HELPER Act. As I understand it, it would 
provide mortgage assistance to firefighters, police officers, 
and teachers. I appreciate the effort to expand access to 
affordable homeownership, and I certainly appreciate the public 
service of people who take on these professions. They deserve a 
chance at the American Dream of homeownership. But, Mr. 
Rutherford, I don't believe that people in these specific 
professions are the only ones who deserve that chance. I 
believe, for example, that nurses, first responders, childcare 
workers, elder care professionals, construction workers, social 
workers, and any other person who works hard every day to 
achieve their dream of homeownership deserves that balance.
    Data from the U.S. Bureau of Labor Statistics shows that 
the individuals assisted by your bill are in occupations that 
are overwhelmingly more White, and more male than the overall 
national workforce. For example, 85.5 percent of firefighters 
are White, and nearly 94 percent are male. That is not 
representative of America, let alone the workforce.
    When the U.S. first created a Federal program to help 
expand access to homeownership through low-down payment 
mortgages, the government actively discriminated against people 
of color, helping to create redlined neighborhoods and 
segregated living patterns that are still visible in many 
communities today. These policies helped create the racial 
wealth and homeownership gaps. The Black homeownership rate 
today sits at 42.7 percent, compared to 47.8 percent for Latinx 
households, and 73.4 percent for White households. This is the 
largest Black-White homeownership gap since 1890, with the 
Latinx-White homeownership gap not far behind, at more than 25 
percentage points.
    Mr. Rutherford, can you please explain why you chose these 
specific professions and whether you would be open to expanding 
the people who qualify for mortgage assistance under your bill? 
Under the Republican budget, 30 percent has been cut from 
housing. Can you add some more people to your bill?
    Mr. Rutherford. I thank the ranking member for the 
question. One of the things that we focused on in this group 
was those who actually serve their community, and as a result 
of that, as I mentioned, need to live in the community that 
they actually serve. And, in fact, one of the demographics that 
you were talking about--I was a sheriff for 12 years in 
Jacksonville, and one of the things that I always wanted to 
achieve was for my agency to represent the community that I was 
protecting, and it was programs like this that would allow me 
to do that because those same individuals who need that 
assistance to buy their first home and remain in the community 
are some of our most-challenged populations.
    And so, I would propose to you that this program will 
actually help minority recruitment by keeping people in the 
community that they serve and making it available for those 
individuals. This was not drafted as a demographic effort, I 
will tell you up front, but I can tell you this: It was based 
on their service. Recruitment in every community is down 
significantly. Retirements are up significantly. Already this 
year, we have had a 22-percent increase in the number of police 
officers who are shot, and not just shot, and this is the part 
that concerns me the most: We have lost 109 officers in 92 
ambush-style attacks already this year. They are being 
targeted.
    This is just one way for us to really help make the 
agencies, and not just police officers, but also firefighters 
and others, make them look like the community that they 
protect. This program will actually help that. I yield back.
    Chairman McHenry. The gentlelady's time has expired. Do any 
other Members seek recognition?
    [No response.]
    Chairman McHenry. If not, we would like to thank the panel 
for coming to appear before the committee, and it's awkward to 
tell my colleagues that you are dismissed, but you are 
dismissed. We will now move to the second panel, so we will 
take a pause here while the panel resets. Thank you all.
    [Pause.]
    Ms. Waters. We are going to add him.
    Chairman McHenry. If the witnesses can accommodate one more 
panelist. We are trying to accommodate everyone as best we can 
before votes.
    Today, we welcome the testimony of a number of our 
committee members and one off-committee member who was 
originally going to be on the first panel. Please don't try to 
embarrass him with your knowledge about the jurisdiction; I am 
joking or at least attempting to joke on this Thursday morning.
    We will now recognize the Honorable Al Green from the State 
of Texas; the Honorable Emanuel Cleaver from the State of 
Missouri; the Honorable Joyce Beatty from the State of Ohio; 
the Honorable Sylvia Garcia from the State of Texas; the 
Honorable Doug Lamborn from the State of Colorado; and the 
Honorable Brittany Pettersen from the State of Colorado.
    We thank each of you for taking the time to be here. Each 
of you will be recognized for 5 minutes to give an oral 
presentation of your remarks. You all know the terrible 
acoustics of these microphones, so I appreciate you all being 
put through the pain that we put our panelists and our 
witnesses through. So with that, we will recognize you for 5 
minutes. We will begin with you, Mr. Green.

   STATEMENT OF THE HONORABLE AL GREEN, A REPRESENTATIVE IN 
                CONGRESS FROM THE STATE OF TEXAS

    Mr. Green. Thank you very much to the ranking member and 
the Speaker Pro Tempore. I greatly appreciate this opportunity 
to speak.
    I rise to speak on: H.R. 1244, the original legislation 
awarding a historic Congressional Gold Medal, collectively, to 
Africans and their descendants enslaved within our country from 
August 20, 1619, to December 6, 1865; H.R. 5490, the Reforming 
Disaster Recovery Act; H.R. 5223, the Original Open for 
Business Act of 2023; H.R. 4204, the Shielding Community Banks 
from Systemic Risk Assessments Act; H.R. 4116, the Systemic 
Risk Authority Transparency Act; H.R. 2465, the Financial 
Compensation for CFPB Whistleblowers Act; and H.R. 166, the 
Fair lending for All Act. And finally, I will make comments on 
the Consumer Financial Protection Bureau (CFPB).
    H.R. 1244 would award a Congressional Gold Medal to the 
foundational mothers and fathers of this country. In 1956, the 
Congress of the United States of America, in its infinite 
wisdom, awarded a Congressional Gold Medal to Confederate 
soldiers. I think it is time for us to recognize the economic 
foundational mothers and fathers of the country whose lives 
were sacrificed to make America great.
    H.R. 5490 would codify into law the fundamental 
requirements and the objectives of the Community Development 
Block Grant Disaster Recovery Program (CDBG-DR). It would 
ensure timely and efficient distribution of relief funds.
    H.R. 5223 would mandate in-person bank branch offices to 
remain open until 7:00 p.m., one day a week, and for 4 hours on 
Saturdays.
    H.R. 4204 would exempt community banks from any special 
assessment of the Federal depository institutions, and it would 
also do so as a result of some of the incidents of which we are 
all well aware.
    H.R. 4116 would require financial regulators to issue a 
report following the use of the systemic risk authority.
    H.R. 2465 would require the Consumer Financial Protection 
Bureau to provide awards to whistleblowers who come forward 
with evidence of wrongdoing, and H.R. 166 would create an 
Office of Fair Lending Testing within the Consumer Financial 
Protection Bureau to expose invidious discrimination and hold 
predatory financial institutions and individuals accountable.
    Finally, moving to the Consumer Protection Bureau, dear 
friends, the CFPB's success can be measured, and the numbers 
speak for themselves. The CFPB is one of the most effective and 
popular agencies within our government; 4 out of 5 Americans, 
including 77 percent of Republicans, support the CFPB. The CFPB 
has obtained $19 billion for consumers in the form of relief, 
and this is for 195,000,000 people. Four million consumer 
complaints have been filed with the CFPB, and 98 percent of 
those have received a timely response from their financial 
company. If we did not have the CFPB, we would surely want to 
create it. Our desire would be there, but sadly, I am not sure 
that it could be accomplished at this time. So I invite all to 
please, let's do what we can to protect the CFPB.
    Finally, returning to the Congressional Gold Medal for the 
enslaved people, 249-plus years of lives sacrificed should 
merit some consideration from this Congress. It is my belief 
that these economic foundational mothers and fathers are the 
persons who can be said to have laid the foundation that we all 
happen to stand upon today when it comes to the economy, the 
economic order, and the stability of this country. So, I am 
hopeful that we will be able to secure the 290 votes, two-
thirds needed, and that we will be able to present something to 
this committee so that we may present to the economic 
foundational mothers and fathers whose lives were sacrificed 
over 240 years to make America great, to present them with a 
Congressional Gold Medal. I thank you for the time, and I yield 
back.
    [The prepared statement of Representative Green can be 
found on page 47 of the appendix.]
    Chairman McHenry. The gentleman yields back. We will now 
recognize Mr. Cleaver for 5 minutes.

STATEMENT OF THE HONORABLE EMANUEL CLEAVER, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF MISSOURI

    Mr. Cleaver. Thank you, Mr. Chairman. I thank you and the 
ranking member for presenting us with this opportunity to share 
our views on things that we would like to bring before the 
committee.
    As you know, I represent Missouri's 5th Congressional 
District, which includes Kansas City, Missouri, the State's 
largest municipality. I also serve as the ranking member of our 
Subcommittee on Housing and Insurance.
    It shouldn't be news to anyone that we are in a housing 
crisis. Demand for housing is far outpacing supply. As a 
result, millions of Americans in urban, suburban, and rural 
neighborhoods are finding shelter to be increasingly 
unaffordable. Prospective homebuyers are facing record-high 
home prices, and millions of renters are cost-burdened and 
spending soaring amounts of their income on housing.
    Project-based Section 8 rental and the Section 8 Housing 
Choice Voucher Programs remain critical tools to support 
renters with the lowest income and reduce housing instability. 
Cuts to these programs and many others would exacerbate 
affordable housing challenges for low-income families 
throughout the nation. I have a number of bills that address 
this nation's affordable housing crisis, as does our ranking 
member, Maxine Waters. I would like to highlight two.
    The first piece of legislation is the Choice in Affordable 
Housing Act. HUD's Housing Choice Voucher Program is the 
Federal Government's major program for supporting affordable, 
safe, and sanitary housing for the elderly, the disabled, and 
very low-income families in the private market. The success of 
the program depends on the participation of private-market 
housing owners, but landlord participation has markedly 
decreased since 2009. At times, we have seen in excess of 
10,000 landlords exiting the program annually. My bill, co-led 
by Congresswoman Chavez-DeRemer, would remove bureaucratic 
barriers and incentivize greater landlord participation. This 
bill has significant agreement and support from both industry 
and advocates.
    The second piece of legislation is the Strategy and 
Investment in Rural Housing Preservation Act. We are now in the 
discussion phase. The U.S. Department of Agriculture (USDA) 
supports investments in affordable rural housing by providing 
Sections 515 and 514 direct loans to developers to build or 
rehabilitate rental housing for low-income families. When these 
loans mature, property owners are no longer required to offer 
affordable units, and tenants are no longer eligible for USDA's 
rental assistance.
    Combined with the lack of new investment, the looming wave 
of maturing loans threatens the stability of hundreds of 
thousands of families. These families have an average household 
income of $13,000, and a large percentage of these families 
have members who are elderly or disabled, meaning this 
assistance is vital to them staying in their homes. My 
legislation would require the USDA to implement a program for 
the preservation and revitalization of such housing projects 
financed with USDA loans. This legislation has previously 
passed through this committee on a bipartisan basis. I have 
also included additional legislation with this statement.
    The Good Documentation and Enforcement of Estate Deeds Act 
(Good DEED Act), which directs the Secretary of Housing and 
Urban Development, is something that is very serious, and I 
appreciate working with Congresswoman Nikema Williams. As many 
of you know, people are stealing other people's homes just 
about every hour of the day, and many of them won't even report 
it because they are embarrassed. We will also be providing a 
statement to all of you so that we can continue to discuss this 
issue.
    It is my hope that this committee prioritizes advancing 
serious bipartisan legislation addressing the affordable 
housing crisis in this Congress. Thank you very much for the 
opportunity to share.
    [The prepared statement of Representative Cleaver can be 
found on page 32 of the appendix.]
    Chairman McHenry. Thank you, Mr. Cleaver. Mrs. Beatty is 
now recognized for 5 minutes.

 STATEMENT OF THE HONORABLE JOYCE BEATTY, A REPRESENTATIVE IN 
                CONGRESS FROM THE STATE OF OHIO

    Mrs. Beatty. Good morning, Chairman McHenry and Ranking 
Member Waters. Thank you for hosting this Member Day hearing. I 
am testifying today about the importance of diversity and 
inclusion in our financial system and the need for this matter 
to be seriously considered by the committee.
    As you know, two Congresses ago, then-Chairwoman Maxine 
Waters made history by establishing the first-ever Subcommittee 
on Diversity and Inclusion (D&I). I had the honor to serve as 
the first ever-Chair, and my good friend, Congresswoman Ann 
Wagner, served as the first-ever ranking member. For the first 
time, Congress conducted oversight of D&I in the financial 
industry and held firms accountable for their D&I practices. No 
surprise, we discovered rampant disparity. We received data 
from 44 of the largest banks with more than $50 billion in 
assets, 31 of the largest investment firms with more than $400 
billion in assets, and the 27 largest insurance companies with 
direct premiums of more than $7 billion. The data we collected 
revealed a staggering lack of workforce and supplier diversity 
across the industry.
    On average, less than 20 percent of executive leaders at 
the largest banks were people of color. Women comprised less 
than one-third of corporate boards at the largest investment 
firms. On average, insurance companies spent less than 3 
percent on diversity suppliers. We also uncovered the stark 
inequality prevalent in asset management. Of the $82 trillion 
in assets under management, only 1.4 percent are managed by 
minority- or women-owned firms. Overall, we found that women- 
and minority-owned businesses face clear barriers to market 
industry, limited access to capital, and persistent 
discrimination.
    Through public hearings and published reports, the D&I 
Subcommittee pushed the industry to do more, and we actually 
moved the needle towards this progress. You have heard today 
from Members on all panels that they have introduced bills on 
D&I, including my two bills, H.R. 2123, and H.R. 7795. I would 
like to enter into the record quotes made by my Republican 
colleagues acknowledging the importance of D&I.
    Chairman McHenry. Without objection, it is so ordered.
    Mrs. Beatty. Despite our gains, we realize that our work is 
not done. I was extremely disappointed, Mr. Chairman, when the 
Chair chose to eliminate the D&I Subcommittee this Congress. On 
February 1, 2023, at this committee's organizational meeting, 
Chair McHenry said on the record that diversity and inclusion 
policies would be under the jurisdiction of every subcommittee. 
At the same meeting, Congresswoman Wagner said she wanted to 
work together to make sure the issue is addressed. Despite 
these promises, nearly a full year into this Congress, we have 
held 55 hearings and not one dedicated to D&I.
    To this day, the jurisdiction has blatantly ignored this 
problem. Economic inequality continues to pervade this country. 
Women still earn only 83 cents for every dollar earned by a 
man. Minorities, and especially Black Americans, consistently 
experience higher rates of unemployment and poverty compared to 
White people. Many groups continue to face high barriers to 
full participation in our financial system. To make matters 
worse, D&I practices are under attack. Virtually every 
Republican-led Fiscal Year 2024 appropriations bill prohibits 
funds from being used to promote diversity and inclusion 
initiatives.
    We are seeing what appears to be a coordinated strategy to 
systematically undo each and every gain achieved over recent 
years. Whether it is on college campuses, universities, or at 
corporations or government agencies, like the Small Business 
Administration (SBA) and minority business development 
agencies, D&I is definitely under attack. We have the data, we 
have the need, and we have moved the needle. Mr. Chairman, I 
come here today to ask that this committee hold hearings 
dedicated to D&I. Thank you for your time, and I yield back.
    [The prepared statement of Representative Beatty can be 
found on page 30 of the appendix.]
    Chairman McHenry. The gentlelady yields back. We will now 
recognize Ms. Garcia for 5 minutes. We will pause the time, and 
reset the time, Ms. Garcia.
    Ms. Garcia. Partisan effort now.
    [laughter]
    Chairman McHenry. Yes.
    Ms. Garcia. Thank you.
    Chairman McHenry. We need electronic voting in committee.
    Ms. Garcia. It says green----
    Chairman McHenry. I know Ms. Waters started that process 
pre-COVID. We need to make that happen, and we need to get 
microphones so we all can just basically hear.
    Ms. Garcia. Okay.
    Chairman McHenry. So, I am sorry, Ms. Garcia.
    Ms. Garcia. It's okay. Thank you.
    Chairman McHenry. Thank you.

 STATEMENT OF THE HONORABLE SYLVIA R. GARCIA, A REPRESENTATIVE 
              IN CONGRESS FROM THE STATE OF TEXAS

    Ms. Garcia. Thank you again, Mr. Chairman and Ranking 
Member Waters, for hosting this Member Day. As I have mentioned 
many times before in this committee, I represent a district 
that is 77-percent Latino and over 90 percent people of color. 
My district, like our great nation, is racially, ethnically, 
and linguistically diverse. I urge the committee's immediate 
consideration and support for my bills: the Community Finance 
Language Inclusion Act, H.R. 2834; and the Multilingual 
Financial Literacy Act, H.R. 2835.
    H.R. 2834 would allow the Community Development Financial 
Institution Fund to provide resources and outreach materials in 
additional language other than English. This Act would direct 
the Financial Literacy and Education Commission to study the 
impact of language barriers on financial health. The bill would 
also require the Commission to promote efforts of Federal 
agencies to make financial literacy resources available in at 
least eight of the most-spoken languages in the United States. 
Combined, these bills would support over 65 million people 
nationwide who speak a language other than English at home, and 
more than 26 million individuals who have limited English 
proficiency.
    This is one of the many ways Congress can act to improve 
the economic status of diverse communities like many in my 
district. Ensuring everyone in the United States can thrive 
financially is not only the right thing to do, but it is also 
the smart thing to do for a country which has about 380 spoken 
languages.
    I also encourage this committee to consider Representative 
Payne's bipartisan Payment Choice Act. The Payment Choice Act 
would guarantee that every consumer has a choice to pay for 
goods and services in cash. As I have always said, cash is 
king. Cash is simple and common. This is not a partisan issue. 
It is an American issue to protect American currency, and I 
encourage all Members to support Mr. Payne's bill, and that we 
consider this bill in committee.
    Furthermore, as the first Hispanic member of the Houston 
congressional delegation, and one of the first two Latinas to 
represent Texas, I urge the committee to focus on making sure 
that we have diverse witnesses. Mrs. Beatty has already 
mentioned diversity and inclusion as a topic. I would urge this 
committee to consider diversity and inclusion, beginning with 
our committee witnesses. Diversity among the witnesses 
presented before the committee is critical to better 
representation, and safeguards against implicit bias and 
artificial barriers.
    Finally, as co-Chair of the Congressional Homelessness 
Caucus, I would like to draw the attention of the committee 
again to the nation's housing crisis. As many of our colleagues 
have said before me, soaring housing prices have a critical 
impact on the shortage of housing across America. The lack of 
housing units is impacting the most-vulnerable lowest-income 
individuals, leading to more homelessness. In 2022, a total of 
582,462 individuals experienced homelessness on any given 
night, and homelessness has been on the rise since 2017, 
experiencing an overall increase of 6 percent.
    It is November, and this committee has yet to hold one 
hearing on affordable housing. And as mentioned by Mrs. Beatty, 
we have had 55 hearings. We must do more, and we must do 
better. Allowing Americans to live in the streets is not a 
standard that our nation should be willing to accept. It is un-
American and it is un-Christian, and it is certainly 
unacceptable.
    Once again, I urge consideration of all of these topics, 
these bills, and I am happy to answer any questions that you 
may have today. Thank you, and I yield back.
    [The prepared statement of Representative Garcia can be 
found on page 37 of the appendix.]
    Chairman McHenry. The gentlelady yields back. We will now 
recognize Mr. Lamborn of Colorado.

 STATEMENT OF THE HONORABLE DOUG LAMBORN, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF COLORADO

    Mr. Lamborn. Thank you, Mr. Chairman, and Ranking Member 
Waters, for having this Member Day hearing and for yielding me 
time to discuss a timely and important bill which was referred 
to this committee. I am here to talk about the bipartisan 
Taylor Force Martyr Payment Prevention Act.
    Taylor Force was a U.S. army artillery officer, West Point 
graduate, and Vanderbilt University graduate student, and he 
served two tours in Afghanistan where he was killed by a Hamas-
affiliated terrorist in 2016. The terrorist killed Mr. Force 
and wounded 10 other civilians before being fatally shot by 
Israeli police. Following the attack, the Palestinian Authority 
made a martyr payment to the family of the terrorist. The 
Palestinian Authority maintains a Martyrs Fund, which pays out 
$300 million annually in monetary rewards to the families of 
killed or incarcerated terrorists. The payments go up when more 
Jews are killed in the attack. Numerous Palestinian and Middle 
Eastern banks facilitate or support martyr payments, 
perpetuating the system which incentivizes attacks on U.S. and 
Israeli citizens.
    To counter these pay-to-slay programs, in 2018, I 
introduced the bipartisan Taylor Force Act, which was signed 
into law by President Trump. The Taylor Force Act aimed to 
eliminate the martyr payment system and force the Palestinian 
Authority to stop incentivizing the killing of Americans and 
Israelis. My bill severely restricted the ability of the 
Palestinian Authority to access U.S. non-humanitarian aid.
    Regrettably, the Martyr Payment system has continued, due 
in large part to Middle Eastern financial institutions refusing 
to block these transactions. These banks, often in nominally-
friendly jurisdictions, purposefully evade U.S. anti-terrorist 
sanctions and continue to knowingly provide banking services to 
Hamas and others. These services are often in U.S. dollar-
denominated transactions for terrorist organizations that 
intentionally target Americans. Such financial conduct is only 
possible through the use of correspondent accounts within U.S. 
banks.
    It is because of this that I introduced the bipartisan 
Taylor Force Martyr Payment Prevention Act, which is before the 
committee. The bill would expand the institutional factors the 
Department of the Treasury must consider when determining if a 
foreign financial institution is of primary money laundering 
concern and subject them to the prohibition of maintaining and 
opening accounts in U.S. financial institutions. Financial 
institutions are not permitted to knowingly provide services to 
Hamas, and this bill would make it harder to skirt the anti-
terrorism laws which prevent banks from working with Hamas to 
move money to terrorists and their families.
    Blocking terrorists from accessing financial tools has 
always been an important issue, but recent atrocities carried 
out by Hamas against Israel in their recent invasion on October 
7th have brought the need for my bill back into the spotlight. 
Congress must act to stop the flow of funding to Hamas. We must 
act to drive Hamas out of the banking system completely.
    Mr. Chairman, and other members of this committee, it is 
clear that stopping martyr payments is as important to you as 
it is to me. I want to thank your committee staff who have 
cooperated with my office as we have worked to move this bill 
and get feedback from stakeholders such as the Treasury's 
Financial Crimes Enforcement Network (FinCEN). Thank you for 
the opportunity to speak with you all, and I yield back.
    [The prepared statement of Representative Lamborn can be 
found on page 53 of the appendix.]
    Chairman McHenry. The gentleman yields back. We will now 
recognize Ms. Pettersen for 5 minutes.

STATEMENT OF THE HONORABLE BRITTANY PETTERSEN, A REPRESENTATIVE 
             IN CONGRESS FROM THE STATE OF COLORADO

    Ms. Pettersen. Thank you, Mr. Chairman, and Ranking Member 
Waters, for allowing me this opportunity to speak to our 
committee and highlight some of the areas that I hope that we 
are able to work on together. I want to thank you both for 
running a professional committee where we actually come 
together to find common ground and work on policies that will 
positively impact the American people.
    I am here to talk about an issue that continues to be 
greatly impactful in Colorado to our economy and our small 
businesses. It is the Secure and Fair Enforcement Banking Act 
(SAFE). You all know that this is a bipartisan piece of 
legislation that was spearheaded by my predecessor and friend, 
Congressman Ed Perlmutter, and it previously passed the House 
of Representatives 7 times since 2019.
    Eleven years ago, Colorado became the first State to 
legalize marijuana, and as the cannabis industry took off, 
these businesses ran into significant challenges in accessing 
basic and critical banking services. Because of existing law 
related to marijuana and cannabis, many financial institutions 
are unable to provide banking and financial services to these 
cannabis-based businesses. Even worse, concerns about Federal 
regulations tie up more than just marijuana growers and 
retailers. Instead, suppliers, vendors, landlords, and 
employees who have been even indirectly tied to the cannabis 
industry see their access to the banking sector at risk, and 
this poses numerous concerns for our community. It also puts 
people in an unsafe position when they are utilizing cash 
instead of using the banking services. I hope that this 
committee is once again going to take up this very important 
piece of legislation.
    Another thing that is a big priority for me, and I know 
that we have already done a lot of work on this issue, is 
addressing the fentanyl crisis. One of the pieces that we still 
have yet to work together on, and I look forward to the 
opportunity, is looking at how our social media companies are 
playing a role in disseminating and, unfortunately, selling 
fentanyl. This is impacting our young people at a very high 
rate, and it is past time that social media companies actually 
have to come to the table and be held accountable for the use 
of their platforms in illicit trafficking.
    I also want to highlight key areas that I think we have the 
opportunity to focus on with housing and insurance. We all talk 
often about the housing crisis. We have a limited supply, and 
we need to all work together. It is an all-hands-on-deck moment 
to ensure that everybody across our communities has the 
opportunity to provide shelter, a roof over their heads for 
themselves and their families.
    Colorado has been impacted by this at a very high rate. We 
have many people who have been moving to Colorado for the last 
10 years, and it significantly increased during the pandemic, 
especially for places in rural Colorado and in my community. 
People have seen the cost of housing increase threefold in just 
a couple of years and are getting pushed out of the communities 
that they have lived in their entire lives. So, I look forward 
to working with this committee to provide the financial 
incentives needed for developers to build the types of 
attainable housing that our communities desperately need.
    I also encourage our committee to look at and explore 
legislation modernizing the FHA loan limits, exploring the 
impact that restrictionary zoning practices are having on our 
housing prices, and ensuring that Federal grant programs 
through HUD, FHFA, and FHA work with rural mountain communities 
like the ones in my community. Another big barrier that we are 
facing in Colorado, and this is happening across the country, 
is the inability to actually insure your home because of 
wildfire risk. I think that we can look at what has worked well 
with the National Flood Insurance Program, what lessons we can 
learn from and look at what options we can provide for people 
across the United States to make sure that if you are at risk 
of a wildfire, you still have options to buy your home and 
insure your home.
    In my remaining time, I want to focus on the risks of 
artificial intelligence (AI) in the banking sector. Financial 
institutions are already utilizing artificial intelligence to 
identify fraud and protect consumers, so this is the benefit. 
However, the risk of deepfakes potentially threatens the safety 
and security of consumer accounts. This is why I introduced the 
Preventing Deep Fake Scams Act with my friend and member of 
this committee, Congressman Mike Flood. This bill will 
establish a task force to examine AI in the financial services 
sector, including both the potential benefits of the technology 
for financial institutions and the unique risks it poses to 
customer account security.
    I look forward to working with all of you on these critical 
issues, and I really appreciate the time. I yield back.
    [The prepared statement of Representative Pettersen can be 
found on page 55 of the appendix.]
    Chairman McHenry. The gentlelady yields back. I want to 
thank the panel. We have votes on the Floor. I don't know if 
the ranking member wishes to say anything, but I will yield 
back, and if you are good to go, then we are good to go. I want 
to thank the panel for your presentation and your feedback and 
your participation. Thanks so much. We will now----
    Mrs. Beatty. Mr. Chairman?
    Chairman McHenry. Yes?
    Mrs. Beatty. Can I submit my revised remarks for the 
record?
    Chairman McHenry. Yes. Without objection, the gentlelady's 
revised remarks will be submitted for the record.
    We will now recess until after votes, and then we will have 
our third and final panel of the day. Thanks so much.
    Ms. Waters. Thank you all very much.
    [recess]
    Chairman McHenry. The committee will come to order. Welcome 
back.
    For today's third panel, we will hear testimony from a 
number of our committee members. We will hear from the 
Honorable Vicente Gonzalez of the State of Texas; the Honorable 
Nikema Williams of the State of Georgia; the Honorable Brad 
Sherman of the State of California; and the Honorable Rashida 
Tlaib of the State of Michigan.
    We thank each of you for your time. You will be recognized 
for 5 minutes to give an oral presentation of your remarks, and 
without objection, your written statements will be made a part 
of the record. We will begin with you, Mr. Gonzalez.

 STATEMENT OF THE HONORABLE VICENTE GONZALEZ, A REPRESENTATIVE 
              IN CONGRESS FROM THE STATE OF TEXAS

    Mr. Gonzalez. Thank you. Chairman McHenry and Ranking 
Member Waters, thank you for hosting today's Member Day 
hearing. As a member of this committee, I am proud of the work 
we are doing to expand access to capital, protect American 
consumers, and strengthen our economy.
    For background, my district encompasses much of South 
Texas, from McAllen on the border to Brownsville where the 
border meets the sea, and up the coast to Kingsville, Texas, 
home of the King Ranch and Naval Air Station Kingsville. My 
constituency is a predominantly underserved, low- to moderate-
income community. We also have over 21,000 veterans located in 
my district. With military installations in my district and 
further north in Corpus Christi and San Antonio, our region is 
large and vast. It is Texas, bigger than most places. We are 
also growing rapidly, and our local economy is booming. For 
reference, our population is projected to double by 2045, but 
to accommodate a growing population, we must foster an 
environment that creates stability, wealth, and growth.
    Starting a small business is expensive and risky. Fifty 
percent of small businesses fail within the first 5 years, but 
they are also the lifeblood of burgeoning communities like 
mine. While some entrepreneurs use personal savings to open a 
business, that is not an option for everyone, including many 
veterans. According to the Institute for Veterans and Military 
Families, 75 percent of reporting veterans have trouble 
accessing capital to start or grow a small business.
    A business loan provides the up-front capital needed to 
open doors, pay staff, and provide a buffer until the business 
starts churning a profit. Credit unions are one of the 
institutions that provide loans to small businesses and support 
them from the beginning of their venture to its end. Currently, 
credit unions are constrained to only lending 12.25 percent of 
their assets to small businesses, severely limiting who can 
access this vital financial service. For a community on the 
rise like mine, the arbitrary cap on member business loans 
stunts economic growth.
    This is happening across the country, which is why I 
introduced H.R. 4867, the Veterans Members Business Loan Act, 
with Congressman Brian Fitzpatrick. This bipartisan bill would 
exempt loans made to veteran-owned businesses from the member 
business lending cap imposed on credit unions.
    Our servicemembers provide tremendous value to our society, 
both while in service and as civilians. I think both parties 
can agree that we need to support our veterans as they 
transition back to civilian life. For many, at least 25 
percent, that means starting a small business. We made a 
promise to support our servicemembers after they put their 
lives on the line to protect the freedoms we cherish, and we 
should do just that. Our veterans deserve every chance to 
contribute to their community, and that means accessing capital 
to start a small business.
    I urge this committee to mark up this important legislation 
and support our veterans as they build a better life after 
service. Thank you, and I yield back.
    [The prepared statement of Representative Gonzalez can be 
found on page 44 of the appendix.]
    Chairman McHenry. Thank you, Mr. Gonzalez. We will now go 
to you, Ms. Williams, for 5 minutes.

STATEMENT OF THE HONORABLE NIKEMA WILLIAMS, A REPRESENTATIVE IN 
               CONGRESS FROM THE STATE OF GEORGIA

    Ms. Williams of Georgia. Thank you, Chairman McHenry and 
Ranking Member Waters, for having this opportunity to offer 
testimony before our committee today. As our committee 
considers legislative priorities for this Congress, I would 
like to highlight a priority that deeply impacts not only my 
constituents in Georgia's 5th District, but also many other 
families around the country.
    As a member of our Housing and Insurance Subcommittee, I 
know that we have not adequately addressed ongoing housing 
issues related to title theft and heir property. People are 
walking into county offices around the country and forging 
deeds all over the country, and it is not even a felony. This 
kind of fraud is called title theft. Criminals are purposefully 
targeting seniors, immigrants, and marginalized individuals who 
lack the financial means to get their homes back through 
expensive and time-consuming court proceedings. We can't 
continue to allow something as precious and hard-earned as 
someone's home to go unprotected. For most people, their home 
is the biggest investment that they will make in their entire 
life. It is an opportunity to build generational wealth that 
can benefit their children, grandchildren, and generations to 
come, working to close the racial wealth gap in this country.
    People work hard for their homes, but there have been 
numerous instances where people are thrown out of their homes 
at a moment's notice due to title theft. One of my constituents 
arrived home in November of 2021 to find a bulldozer in her 
front yard tearing down her home. Her house was paid off, but a 
stranger who had forged a deed and stolen her home decided to 
bulldoze it, and I have the article from Atlanta's WSBTV that I 
would like to submit for the record.
    Chairman McHenry. Without objection, it is so ordered.
    Ms. Williams of Georgia. This is why I am co-leading 
Ranking Member Cleaver's Good DEED Act that addresses title 
theft by establishing a $10-million annual grant program 
administered by the U.S. Department of Housing and Urban 
Development to fund applications that assist in the prevention, 
detection, investigation, and prosecution of deed fraud; 
mandating that States receive funding; amend State laws to 
require identifiable information of individuals notarizing and 
filing deeds; requiring HUD to report to Congress on activities 
funded under the grant program and to identify best practices 
in reducing deed fraud; directing the U.S. Sentencing 
Commission to promulgate guidelines or amend existing 
guidelines for offenses involving deed fraud; and requiring the 
Federal Bureau of Investigation to add a category for deed 
fraud to the Uniform Crime Reporting Program. The Good DEED Act 
will support preventative measures to stop devastating land 
loss from American families, provide better tools for the 
investigation and prosecution of those engaged in such crimes, 
and support victims in restoring homes to the rightful owners.
    And another housing issue that disproportionately impacts 
minority communities has to do with heir property and tangled 
titles. Property becomes heir property and titles become 
tangled when family homes or land are passed from generation to 
generation through inheritance, usually without a will or a 
formal estate strategy. One study found that people of color 
were less than half as likely as their White peers to have a 
will. This tendency is especially problematic in Georgia 
because dying without a will converts a family home, land, or 
other property into heir property.
    A report by the Georgia Heirs Property Law Center puts the 
scale of the problem in perspective. It is estimated that there 
is over $47 billion in probable heirs property in Georgia--
billion with a, ``B.'' This is especially concerning because 
low-income families, people of color, and other marginalized 
groups are more likely to be the owners of heir properties, 
putting them in vulnerable positions. Heir properties make it 
much more difficult for families to generate wealth because 
every heir is responsible for paying taxes and other expenses, 
and has the ability to transfer their stake to an outsider, and 
must agree to key decisions about the property. Taken together, 
this means that owners of heir property are much more likely to 
face eviction or a forced sale.
    This is an issue that needs to be talked about more. 
Tangled titles limit the ability of people of color to pass 
wealth from generation to generation, putting the American 
Dream even further out of reach. I am working to create 
legislation with Ranking Member Cleaver to complement the Good 
DEED Act and to address the issues caused by heir property and 
tangled titles, and I hope the committee will give it the 
consideration that it deserves. Together, we can address these 
two critical issues that impact marginalized communities' 
ability to generate wealth, and that is the only way that we 
can truly begin to close the racial wealth gap, which, 
unfortunately, my district continues to lead the nation in.
    In closing, thank you, Chairman McHenry and Ranking Member 
Waters, for the opportunity to testify before you today, and I 
am hopeful that this committee can begin to address the issues 
brought before you today. And I hope to find ways to work with 
both the chairman and the ranking member as we do this work on 
behalf of the people that we were sent here to represent. Thank 
you so much.
    [The prepared statement of Representative Williams of 
Georgia can be found on page 71 of the appendix.]
    Chairman McHenry. Thank you. We will now recognize Mr. 
Sherman of California.

 STATEMENT OF THE HONORABLE BRAD SHERMAN, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF CALIFORNIA

    Mr. Sherman. Thank you. Thank you, Chairman McHenry and 
Ranking Member Waters, for this opportunity to testify. I want 
to draw your attention to several pieces of legislation that I 
have introduced or will introduce. All of them except one are 
already before you in legislative language form, and it is good 
to get a chance to get a hearing on these pieces of 
legislation. Quite a number of them deal with investments in 
China.
    Capital builds economies, and from a macroeconomic 
standpoint, we would prefer that Americans not invest in China 
but invest here. However, we have very substantial flows of 
capital from China really into debt instruments issued by the 
United States and its companies. So, this is not an attempt to 
prevent Americans from investing in China across-the-board but 
to make that system fair and reasonable and provide adequate 
investor protection.
    The first bill is the China Risk Reporting Act, which 
requires that when companies register with the SEC, they 
discuss in their registration materials two things: first, the 
degree to which the company is dependent upon China; and 
second, the steps the company has taken to reduce its China 
risk. That second is so important because as American companies 
compete for capital, they should try to establish that they 
have the best record of working to de-risk their companies. If 
you de-risk your companies, you reduce risk for our entire 
economy.
    The second is the PRC Military and Human Rights Capital 
Markets Sanctions Act. We currently prohibit Americans from 
investing in certain Chinese companies involved in defense and 
intelligence. This bill expands that to cover those who have 
been designated by the United States as involving coerced labor 
and human rights violations.
    The third is the No China Index Funds Act. There are such 
unique difficulties in evaluating a risk of investing in China, 
that if the company is based in China, it should not be in a 
low-cost fund or an index fund. It should only be invested in 
by Americans who are looking very carefully at that company, 
not paint by the numbers.
    The fourth is the No Capital Gains Allowance for American 
Adversaries Act. As you know, we encourage Americans to invest 
in stock, not only by providing a capital gains allowance, but 
a step up in basis upon death. That is because we believe we 
want to encourage investment in American companies and the 
American economy. So, why are we providing these incentives for 
investing in the Chinese economy or that of Russia, Belarus, or 
Iran?
    This bill would treat as ordinary income and as an ordinary 
income asset any investment in companies based in China, 
Russia, Iran, or Belarus. Now, of course, that is mostly a 
House Ways and Means Committee bill, but it is only appropriate 
that investors fully understand the difference in taxation 
investing in a Chinese company versus one that is not in one of 
our adversaries, and that is why this bill also needs to be 
referred here to make sure that those investor disclosures are 
made.
    The fifth is the Sanctioning Iran's Special Drawing Rights 
Transactions Act, and this is one that says that the United 
States won't move forward with increasing special drawing 
rights until there is more accountability and transparency into 
how Iran uses its special drawing rights.
    The sixth is the Bank Safety Act. This requires that banks 
of over $100 million recognize unrealized losses on available-
for-sale securities when they compute capital for bank 
regulatory purposes. Silicon Valley Bank didn't do this, and 
that is why we had to bail out the depositors of Silicon Valley 
Bank.
    And finally, the Effective Bank Regulation Act, which 
requires that when we do stress testing, we stress test for 
increases and decreases in interest rates. I have been here in 
this room for a long time. Interest rates go up, and interest 
rates go down. Banks, if they are going to show that they can 
handle a stress, should prove that they can handle both up and 
down.
    The second thing I should point out is that credit risk is 
most associated with loans to small businesses. Interest rate 
risk is most associated with billion-dollar bond purchases by 
banks. We now have a system that encourages banks to invest in 
the big bonds and discourages them from investing in small 
businesses. We ought to have a fair playing field as our small 
businesses compete with Treasuries and with bonds issued by 
giant businesses when they seek bank capital.
    Thank you. I hope you have some questions.
    [The prepared statement of Representative Sherman can be 
found on page 61 of the appendix.]
    Chairman McHenry. The gentleman's time has expired. We 
thank the gentleman for his testimony. And I thank the 
gentlelady from Georgia for her testimony as well. We are going 
to pause to accommodate our final Member and her testimony.
    Ms. Waters. Let me take this opportunity to thank our 
Members for showing up today and sharing with us what you are 
working on, and what you care about. It certainly does give me 
an opportunity to know better how I can work with our Members 
and how I can be helpful, so I appreciate you being here today 
and I wish you a good weekend.
    Mr. Sherman. Thank you.
    Chairman McHenry. The panel may be dismissed, and we will 
pause to accommodate our final Member.
    [Pause.]
    Chairman McHenry. The committee will return to order, and 
we will now recognize our final panelist of the day, our 
ultimate panelist of the day, the Honorable Rashida Tlaib of 
the State of Michigan. You are now recognized for 5 minutes. 
Thanks so much, and you are now recognized.

 STATEMENT OF THE HONORABLE RASHIDA TLAIB, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF MICHIGAN

    Ms. Tlaib. Thank you, Mr. Chairman. And thank you to my 
colleagues for this opportunity to talk about the impact of a 
number of policies on my constituents. Today, I want to talk 
about two issues affecting our residents: medical debt as a 
factor in credit reports and auto insurance discrimination.
    Mr. Chairman, roughly 20 percent of Americans have medical 
debt, and it is a tremendous amount of burden. In addition to 
regularly forcing families to exhaust their savings or cut back 
on food or clothing, such debt also prevents--and this is the 
key issue--residents from meeting their basic needs by marring 
their access to credit, meaning access to homeownership, and a 
number of issues, again, treating medical debt as if they 
purchased a car and not actually sought health services. I 
believe this is wrong. Mr. Chairman, undergoing, a medical 
procedure should never haunt someone financially. No one 
chooses to be sick.
    To make matters worse, medical debt has questionable 
predictive value. It is not necessary to use medical debt to 
predict a borrower's future credit risk. Furthermore, debt 
collectors often rely on inaccurate information, as many of our 
residents have told us, also pressuring those recovering from 
illnesses to pay bills they might not even owe. The issue also 
hits particularly hard in communities like mine, where 
residents already face challenges with access to credit, and I 
have long advocated on behalf of those saddled with medical 
debt. For instance, my Restoring Unfairly Impaired Credit and 
Protecting Consumers Act would prohibit outright the reporting 
of medical debt on consumer reports, among those provisions to 
protect consumers.
    A medical emergency should not and need not send a family 
into financial ruin. I have seen it with my families who 
literally have a loved one with cancer and so forth literally 
go bankrupt, preventing them, again, from truly being able to 
thrive in our country. I urge my colleagues to please join me 
in ensuring that no one, no family has to face such 
difficulties by please supporting this bill and bringing it 
before this committee for consideration.
    The next issue I would like to now discuss is auto 
insurance discrimination. Discrimination is keeping my 
residents in a cycle of poverty. Marital status, credit score, 
and all of those things should not be factors in whether or not 
somebody is a good driver, and right now, this has been 
impacting folks. In order to take a new job or go to school or 
deal with a medical emergency, one needs access to reliable 
transportation, and for many of my residents in my district, 
that means access to a car, yet Michigan has some of the most 
expensive car insurance in the nation. So, it is outrageous to 
me that my residents get asked whether or not they are married, 
what kind of education level they have, or their credit score. 
All of it is really incredibly hurtful in being put towards the 
auto insurance rates.
    This summer, I know Michigan residents saw a 42-percent fee 
increase by the Consumer Michigan Catastrophic Claims 
Association, adding to high fees that are already unaffordable 
for many of our families. I know when I saw the University of 
Michigan report showing somebody with a DUI--driving under the 
influence--but he had a lower credit score compared to someone 
with a very decent credit score, but not as high, but he had no 
DUI. The person who had the DUI--driving under the influence--
was paying 3 times higher auto insurance rates than the person 
who did not have any violation, so we must stop using these 
non-driving factors in auto insurance rates.
    So again, I am really grateful for my amazing partner in 
this, Congresswoman Bonnie Watson Coleman. We have the Prohibit 
Auto Insurance Discrimination Act, which would prohibit the use 
of these proxies, like education and ZIP Codes, to calculate 
insurance rates. Again, thank you so much for this opportunity 
to uplift my residents in some of the struggles that they have, 
and hopefully, my colleagues on the Financial Services 
Committee will work with me on those issues.
    [The prepared statement of Representative Tlaib can be 
found on page 67 of the appendix.
    Chairman McHenry. Thank you. Thank you for your testimony 
on important policy matters, and I thank you for making it here 
for Member Day. Yours is the final testimony of the day, so I 
will yield to the ranking member.
    Ms. Waters. Thank you very much. Ms. Tlaib, I want to thank 
you for your strong leadership in highlighting all of the 
problems with medical debt, and I would like to just get a 
little advice from you here. Of course, we know how it unfairly 
tarnishes so many consumers' credit scores, the way the 
information gets reported by the major credit bureaus. There is 
no research that shows medical debt is a good indicator of an 
individual's creditworthiness. If you get sick and need medical 
care, that should not affect your ability to take out a loan, 
rent an apartment, or even get a job, but that is exactly what 
has happened, given the way our broken credit reporting system 
works.
    After working on this issue myself for more than a decade, 
I was pleased that the national credit bureaus have taken steps 
to remove some medical debt information from consumers' credit 
reports. However, much more needs to be done, and I am pleased 
that CFPB Director Chopra is taking further steps to address 
this issue.
    Ms. Tlaib, we have not held any hearings in our committee 
this year exploring this issue in any depth. Do you believe 
that the committee should hold a hearing with the CEOs of the 
national credit bureaus, and experts on these issues, and then 
look to mark up your bill and others put forward by members of 
our committee to fix our broken credit reporting system? What 
do you think?
    Ms. Tlaib. Yes, and, Ranking Member Waters, as you know, we 
did actually have the three largest credit reporting agencies 
before our committee, and many of us were able to ask some of 
the tough questions that many of my residents are asking. I 
know the Chair and I talked about medical debt and his personal 
experiences of something getting paid, but it is still showing 
up on people's credit reports.
    I think folks don't realize how incredibly important it is 
to fix credit reporting. It is literally the access to economic 
opportunities, so even if you are doing well but you get sick, 
again, it gets on your credit report. It impacts literally 
whether or not you are able to thrive later, whether or not you 
can even get a loan for a car. People are now looking at credit 
reports, Ranking Member, for employment. Folks look to it as 
some sort of factor in whether or not this person should be 
getting a loan or for housing or whatever, but, again, medical 
debt, to me, it is not like somebody is, like, hey, I am just 
going to go and rack up medical debt. They are sick.
    The majority of the time, when you hear folks talk about 
filing for bankruptcy in our country, a big, huge factor is 
medical debt. It is somebody in their family or themselves 
getting very sick, and, again, cancer is one that I hear 
consistently in my district, folks who have to pay an 
exorbitant amount of money because their insurance doesn't 
cover fully because they are underinsured or not covered as 
much. It is the prescription drugs that continue to pile on my 
residents. And again, they may not have to pay the full amount, 
but all of it adds up, especially when it takes months and 
sometimes years to recover from a serious illness.
    Ms. Waters. Thank you so very much, and your being here 
today certainly helps put more focus on the issue, and I 
certainly will work with the chairman to see what we can do in 
terms of the hearings that you are suggesting. Thank you.
    Ms. Tlaib. Okay.
    Chairman McHenry. The gentlelady yields back. I would like 
to thank our witnesses for their testimony today. We appreciate 
your insight.
    The Chair notes that some Members may have additional 
questions for these witnesses, which they may wish to submit in 
writing. Without objection, the hearing record will remain open 
for 5 legislative days for Members to submit written questions 
to these witnesses and to place their responses in the record. 
Also, without objection, Members will have 5 legislative days 
to submit extraneous materials to the Chair for inclusion in 
the record.
    This hearing is adjourned.
    [Whereupon, at 11:42 a.m., the hearing was adjourned.]

                            A P P E N D I X


                            November 9, 2023


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