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Departments of Transportation, Housing and Urban Development and Related Agencies Appropriations Act, 2008 -- Continued

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Location: Washington, DC


DEPARTMENTS OF TRANSPORTATION, HOUSING AND URBAN DEVELOPMENT, AND RELATED AGENCIES APPROPRIATIONS ACT, 2008--Continued -- (Senate - September 11, 2007)

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Mr. KOHL. Mr. President, I rise today to support amendment No. 2818, offered by colleagues, Senators Durbin, Snowe, Collins, Kerry, and myself. This amendment would limit the amount of operating funds a small public housing authority will lose each year if they decide to opt out of asset management.

The Department of Housing and Urban Development issued a final rule on September 19, 2005, that outlines procedures for public housing authorities to convert to asset management accounting. In the recent past, Congress has urged the Department to review and postpone the conversion process due to lack of guidance and difficulty many PHAs are facing to implement the new plan. Small PHAs are having an extremely hard time converting to asset management due to lack of funds and staff. Most of these agencies only have one or two people in the central office and their operating subsidy has been continuously underfunded. The Transportation, Housing and Urban Development Appropriations legislation includes language that will allow small agencies to opt out of asset management; however their operating fund subsidy will be reduced each year they do not convert.

This amendment would help PHAs which operate 250 units or less and opt out of asset management by limiting the amount of money their operating subsidy can be reduced each year to 5 percent. In Wisconsin, numerous agencies have expressed their support for the stop-loss provision. For example, the Eau Claire Housing Authority would lose half of their subsidy by 2012, the Beloit Housing Authority would lose over $20,000 in operating funds in the first year and an additional $10,000 each year until 2012, and the Ladysmith Housing Authority, located in Rusk County, would lose over $15,000. These are just three examples out of the 46 agencies in Wisconsin that would be negatively impacted by HUD's rule if this amendment is not adopted.

It is imperative that these agencies stay operational. They serve the housing needs for the low-income and elderly in rural communities across the country. I urge the adoption of this important amendment.


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