Hearing of the Senate Committee on Banking, Housing and Urban Affairs - Nominations

Statement

Hearing of the Senate Committee on Banking, Housing and Urban Affairs - Nominations

Chaired By: Senator Jack Reed (D-RI)

Nominees: Peter M. Rogoff, to be Federal Transit Administrator, Department of Transportation; Francisco J. Sanchez, to be Undersecretary for International Trade, Department of Commerce; Raphael W. Bostic, to be Assistant Secretary for Policy Development & Research, Housing and Urban Development; Sandra Henriquez, to be Assistant Secretary For Public And Indian Housing, Housing and Urban Development; Mercedes Marquez, to be Assistant Secretary for Community Planning & Development, Housing and Urban Development; Michael S. Barr, to be Assistant Secretary for Financial Institutions, Department of Treasury

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SEN. REED: The hearing will come to order. We are meeting today in open session to consider the nomination of six key nominees for the Obama administration. On behalf of the chairman, who is currently engaged on the Senate floor working on the credit card legislation, I'd like to welcome my colleagues, distinguished guests, our nominees and their families and friends to this important hearing.

At this time I would like to recognize my colleague, Senator Bill Nelson, who wants to introduce Mr. Francisco Sanchez.

Senator Nelson.

SEN. BILL NELSON (D-FL): Thank you, Mr. Chairman.

Frank Sanchez has been a personal friend of mine for a number of years, and he is up for something that he is uniquely qualified, which is the undersecretary of Commerce for International Trade.

He has had all kind of experience in international trade administration, as well as the Tourism Policy Council, the National Intellectual Property Council. He has been the chief of staff in the White House to the special envoy to Latin America.

He's a Florida native. He's an accomplished negotiator. He's authored a book. He served our former colleague, Senator Bob Graham when he was governor in his administration as the first director of the state's Caribbean Basin Initiative. And he has been involved in consulting companies on projects involving complex transactions, labor management negotiations, litigation settlement, and negotiation strategy.

And so this brings a unique set of qualifications. He's even split the difference in Florida: he attended the University of Florida, but he graduated from Florida State. (Laughter.) He does -- for us Yale guys, we won't hold it against him -- he has a master's degree from Harvard, from the Kennedy School.

And he's worked with the National Security Council, the State Department, the U.S. Trade Representative. So you couldn't have a better candidate for this very important job of undersecretary of Commerce.

And on top of that, he is a good guy. And he is a personal friend of mine. Thank you for letting me make these comments about him.

SEN. REED: Thank you, Senator Nelson.

Now let me recognize Congressman Barney Frank to introduce Sandra Henriquez. And by the way, Senator Kerry has a statement for the record, Ms. Henriquez.

Congressman Frank.

REP. BARNEY FRANK (D-MA): Thank you, Mr. Chairman. I am very pleased to be able to introduce Sandra Henriquez on her behalf, but more on behalf of some of the most, I think, unfairly treated people in this country, and those are the residents of public housing.

This country created public housing. You know, sometimes the residents are criticized because of decisions that were made not with their participation about what kind of housing they should live in.

And we know now, better than we used to, how to build decent, livable, affordable housing, but we're still in some cases, frankly, stuck with stuff that wasn't built well in terms of social concerns.

Sandra Henriquez has run one of the largest housing authorities in the country, in the city of Boston. It is a housing authority population that is diverse in terms of age, in terms of ethnicity, in terms of race. It's been a very significant part of Boston for some time. It's been historically a troubled institution.

She has done an excellent job, and I am very pleased that the president has selected someone to run the Department of Public and Indian Housing who has a demonstrated record of dealing sensibly, compassionately and efficiently with the residents of public housing.

I should note that part of her title is Indian Housing, and there are probably no people in America as a whole with greater housing problems than the Native American population.

People who've been out, for instance, to the Navajo Reservation have seen a very serious problem. I'm very proud that on the -- in recent years on the Committee on Financial Services, which is the corresponding committee for this Committee, we've worked hard -- and you, Mr. Chairman, Senator Reed, have been a leader in this.

We have been paying attention to the needs of the Native American population housing, which has long been neglected.

So Sandra Henriquez is very well qualified. She is a thoughtful, intelligent, compassionate, successful administrator, and I am very hopeful that she will be promptly confirmed.

Now, I do understand there are different rules in the House and the Senate, and I am prepared to learn that she was confirmed on the proviso that she carry a concealed weapon. I understand that the Senate might decide to add that, as they have from time to time. (Laughter.) That's not my decision to make.

I can only urge that this very, very able woman, who has done such a good job in administering public housing in Boston, be confirmed.

SEN. REED: Thank you, Chairman Frank.

And now I'd like to recognize Congressman Schiff to make an introduction of Raphael Bostic.

Congressman?

REP. ADAM SCHIFF (D-CA): Thank you, Mr. Chairman, Senator Reed, and Ranking Member Shelby. I very much appreciate the opportunity to appear before your Committee again, and thank you for allowing me to introduce the president's nominee for assistant secretary of the Office of Policy Development and Research of the Department of Housing and Urban Development, Raphael Bostic.

Dr. Bostic is a proud resident of Pasadena, and we share a common bond as graduates of the same alma maters, Stanford and Harvard, although Dr. Bostic, unfortunately, did it in the wrong order. But he can be forgiven for that.

He's dedicated his career to understanding housing markets and the issue of home ownership. He has extensively studied the sectors that will be critical to our economic recovery -- credit markets and home financing -- and understands well how they affect the American household.

His expertise in these most pressing and complex issues of our time make Dr. Bostic an ideal candidate for this position.

As assistant secretary, he'll be the principal adviser to the secretary on overall departmental policy and will be responsible for maintaining current information on housing needs, market conditions, and existing programs.

Dr. Bostic is currently a professor in USC's School of Policy Planning and Development and teaches courses in affordable housing development, urban economics, real estate finance, policy and planning analysis, and public finance.

He led a distinguished career prior to his years at USC, spending six years on the staff at the Federal Reserve Board of Governors, where he was awarded a special achievement award for his work.

He also served as a special assistant to the assistant secretary of policy development and research at HUD, providing him with crucial experience in the executive branch, which will no doubt serve him well in his new post.

His most recent research examines how mortgage finance institutions such as Fannie Mae and Freddie Mac have influenced the flow of mortgage credit through lenders that originate high-cost or subprime loans through the Federal Housing Administration insurance program.

He's also studied the role of the private-label secondary market in facilitating the flow of capital to subprime and possibly predatory loans. His work has been published in a number of top peer-reviewed journals, including Real Estate Economics, Housing Policy Debate, and the Journal of Banking and Finance.

Dr. Bostic is an active contributor to numerous professional and industry organizations and holds leadership positions in the American Real Estate and Urban Economics Association, the Association of Public Policy and Management, and recently served on a National Academies committee charged with evaluating the research plan of the Department of Housing and Urban Development.

Given his background, he was an ideal panelist for an economic roundtable that I held in Pasadena nearly a year ago after the collapse of IndyMac, which was headquartered in my district.

With a tightening credit market and increasing foreclosures, residents in my district as well as around the country were looking for answers and advice about how they could stay afloat, and Dr. Bostic was and has been a clear and well-informed voice during these difficult times.

Many Americans are still struggling with these questions today, and I'm confident that with Dr. Bostic advising the secretary on housing policy, the Department will make the right policy decisions to help families around the country.

I urge the Committee to approve his nomination, and I thank you again, Senator, for allowing me to appear today.

SEN. REED: Thank you very much, Congressman.

And now let me recognize Senator Patty Murray of Washington State.

Senator Murray?

SEN. PATTY MURRAY (D-WA): Well, thank you very much, Mr. Chairman and Senator Shelby.

I am very pleased to be here today to have the opportunity to introduce Peter Rogoff as the president's nominee to be the next administrator of the Federal Transit Administration.

I do want to welcome Peter's wife, Dina Morris (sp), who's here with us, as well as their two children, Lucy (sp) and Niles -- who are behaving very well behind, you Peter. Don't worry. (Laughter.)

Peter and his wife are no strangers to public service, and I really want to thank them personally for both of their commitment and congratulate them on all they've accomplished.

And I would just tell Lucy (sp) and Niles that I understand that confirmation hearings actually get you extra credit in school, so thank you for being here.

For members of the Senate Appropriations Committee, Peter is a very familiar face. He has served on the Appropriations Committee staff now for the last 22 years, and he's been the Committee's senior transportation adviser for the majority of those years.

For the past nine years, as I have served as either chairman or ranking member of the Transportation Appropriations Subcommittee, I've had the opportunity to work very closely with Peter.

He has been a trusted adviser to me and a dedicated public servant to the constituents of both my home state of Washington and those of every member of the Subcommittee.

I know that Peter's drive and knowledge and experience will be an outstanding asset to President Obama and Secretary LaHood's team.

Peter and I have worked together through many challenges over the years, none greater than the events of September 11th and the transportation security issues that we were confronted with after that.

As members of this Committee know well, those efforts weren't just limited to aviation security, but they also included initiatives to strengthen security in passenger rail -- transit system and our ports and all the systems that connect them.

During those very difficult times, Peter's understanding of our transportation safety systems was fully evident. It's a knowledge that comes with experience, and not just the kind of experience you get from studying policy at your desk -- although Peter does do a lot of that.

But it's the kind of experience you get from traveling out to accident sites, talking with inspectors, meeting with families and working hands-on to ensure that we are taking steps to ensure that accidents are not repeated.

In the time that I've worked with Peter, he has regularly traveled across the country to participate in aviation, rail, and ship inspections and he's voluntarily gone to many accident sites.

The expertise gained from those experiences has served this Congress and this country well in some very critical situations. In fact, I still remember -- and I know Peter does as well -- an evening just about two years ago when we all watched in horror as the I-35 bridge collapsed in Minneapolis.

Immediately after that tragedy, I dispatched Peter to accompany Senator Klobuchar to the scene because I knew that he could help her identify the core issues and how the federal government could help.

Now, I know that as FTA administrator Peter would face a set of wide-ranging challenges, but I also know that he has the transit know- how to hit the ground running.

From my work with Peter, I know that he believes in the larger agenda to expand transit ridership and reduce greenhouse gas emissions.

I know that he understands how important it is to move projects forward rapidly in a manner that is efficient and productive. And I know that he has the experience to address our biggest challenge, transportation finance.

As all of you know, the outlook for the Highway Trust Fund and its mass transit account is truly dismal. These financing challenges threaten to undermine all that Congress and the president hope to accomplish for our state and our communities.

To this central problem, Peter Rogoff will bring over two decades of working knowledge on financing transit and transportations projects of all kinds.

So, Mr. Chairman, while his nomination represents a very big loss for our Appropriations Committee and my Appropriations Subcommittee, I respect and I commend President Obama's decision to put Peter's expertise to work on addressing our country's transit future.

It's without any reservation that I commend to you the nomination of Peter Rogoff to be our next Federal Transit Administrator.

All of us that care about public transportation, a clean environment and the mobility needs of our (neediest ?) citizens are going to be very proud to have Peter Rogoff in this position.

So thank you very much, Mr. Chairman.

SEN. REED: Thank you very much, Senator Murray.

Let me make brief comments about the nominees before I recognize Senator Shelby for his opening comments. And there may be other colleagues that will join us for introductions, and I'll try to work them in as rapidly as possible.

First, beginning with Peter Rogoff, the president's nominee to lead the Federal Transit Administration.

We all recognize that strong federal leadership in transportation is one of the keys to getting our economy back on track. A bold, new commitment to public transportation is needed to reduce congestion on our roads, to address climate change, and to reduce our dependence on foreign oil.

And let me say I second with enthusiasm all of the commendations that Senator Murray made. And thank you, as a member of the Appropriations Committee, for your assistance and help, Peter, and we look forward to your service in the Federal Transit Administration.

Our next nominee is Mr. Francisco "Frank" Sanchez. Senator Nelson described your stellar career, Mr. Sanchez. You've been nominated for undersecretary of Commerce for international trade.

As undersecretary, the role will play a particularly critical aspect in reviving America's struggling economy. One out every 10 American jobs depends on exports, which in 2008 generated $1.8 trillion in U.S. business revenue.

So this is an extremely important job to match your public service and your talents.

We also have three nominees for the Department of Housing and Urban Development who are before us today.

Like never before, we need an engaged, aggressive, and well-run Department of Housing and Urban Development with leadership that is confident in its mission and unafraid to act.

As President Obama has himself said, HUD's role has never been more important.

Our first HUD nominee is Mr. Raphael Bostic, who was introduced by Congressman Schiff. He has been nominated to be the assistant secretary for -- (inaudible) -- of policy development and research.

And Mr. Bostic, in such a role, would be responsible for maintaining current information on the housing needs, market (conditions ?) and existing programs, as well as conducting research on priority housing (and ?) any developing issues.

Our next nominee is Ms. Sandra Henriquez, who was introduced by Congressman Frank. She has been nominated to be assistant secretary for public and Indian housing.

In fiscal year 2009, this office will be expected to administer nearly $24 billion in targeted housing assistance programs serving low-, very low-, and extremely low-income families and individuals. These include public housing and Section 8 tenant-based rental assistance programs, which serve over 3 million families, seniors, and persons with disabilities.

These housing programs are carried out by approximately 1,600 staff in headquarters and field positions throughout the country. This is an extraordinarily important and influential post.

Our final HUD nominee is Ms. Mercedes Marquez, who has been nominated to be assistant secretary for community planning and development.

This division administers nearly $8 billion in community, economic, and affordable housing development programs in the FY 2009 budget.

In addition, it currently administers $6 billion in neighborhood stabilization program funding, helping communities buy and rehabilitate abandoned and foreclosed properties. And these programs are carried out by approximately 800 staff in headquarters and field positions.

Our final nominee today will be Michael Barr, who has been nominated to be the assistant secretary for financial institutions at the Department of Treasury.

In this position, Mr. Barr will be responsible for working on administration policy regarding the regulation of banks, credit unions, government-sponsored enterprises, consumer protection, community reinvestment, federal deposit insurance, and terrorism risk insurance. Quite a portfolio.

He will be uniquely situated to work with this Committee to achieve its goals of modernizing the United States financial institutions, a task that I know the chairman and Senator Shelby are undertaking at this moment.

Mr. Barr is highly qualified for this position. He currently is teaching at the University of Michigan. Previously he served as Treasury Secretary Robert Rubin's special assistant, as well as special adviser to President Clinton.

Mr. Barr also served as a law clerk to U.S. Supreme Court Justice David H. Souter and then District Court Judge Pierre N. Leval of the southern district of New York.

Mr. Barr received his J.D. from Yale Law School, a master of philosophy in international relations from Magdalen College, Oxford University, as a Rhodes Scholar. He has a B.A. summa cum laude with honors in history from Yale University.

Again, let me welcome all the nominees. You will have the opportunity when you're recognized to also introduce your families.

But now let me turn to the ranking member, Senator Shelby, for his statement.

Senator Shelby.

SEN. RICHARD SHELBY (R-AL): Thank you, Mr. Chairman.

First of all, I want to welcome all the nominees. I'm sure you've been well vetted and eminently qualified and ready to go to work. And I hope that Senator Dodd, our chairman, will move these nominees as soon as possible.

(I'd like to ?) say a special word here about Peter Rogoff. A lot's been said about him, but I had the opportunity to work with him for a long time on the Appropriations Committee.

As we used to say, we worked for Peter. (Laughter.) And we didn't mind that, because he had great work skills, great leadership skills. And Peter, we're happy that the president has seen fit to nominate you to this very important position in the Department of Transportation.

We look forward this year, working on the Banking Committee, as you well know, we have a piece of the -- (inaudible) -- of transportation, transit, and other things. And you will bring a lot of knowledge to this position, and I believe you'll bring a lot of integrity to this.

And I look forward to supporting you especially and supporting all of you as soon as we can. And if you'll forgive me, Senator Dodd and I are holding -- we're trying to move a credit card bill on the floor, and so -- I'll leave it up to you, but I'll support your nominees.

SEN. REED: Thank you very much.

We have been informed that Senator Martinez would very much like to be here, Mr. Sanchez, and when he arrives we'll recognize him to say a few words.

And I think also Congressman Becerra would like to say a few words, Ms. Marquez, and when he arrives we'll also recognize him.

But first I have a obligation to perform, if you would please stand, and I will administer an oath. And simply respond, "I do" after each phrase. Please raise your right hands.

(Oath administered.)

NOMINEES: I do.

SEN. REED: Do you agree to appear and testify before any duly constituted committee of the Senate?

NOMINEES: I do.

SEN. REED: Thank you very much. Please be seated.

And now let me recognize -- (Aside.) Do you have any comments, Bob? Okay. You'd like to say something?

SEN. ROBERT BENNETT (R-UT): Yeah.

SEN. REED: Let me recognize Senator Bennett.

Please.

SEN. BENNETT: Thank you, Mr. Chairman. I don't want to prolong this.

And I would love to say something good about all the rest of you, but I don't know any of you yet. (Laughter.) That doesn't usually stop senators, but I think under these circumstances, it will. (Laughter.)

But I want to again add to the chorus of comment and praise for Peter Rogoff and the work that he has done as a member of the Appropriations Committee.

Peter, I know you've been to Utah. You understand the transit issues in Utah, and we look forward to work with you. But I didn't want to let this occasion go by without adding my voice to those that are saying we're sorry to lose you, but good luck and all the best in your new assignment.

SEN. REED: Thank you, Senator Bennett.

Senator Akaka, would you like to say something at this time?

SEN. DANIEL AKAKA (D-HI): Mr. Chairman, thank you for having this hearing. As you said, we are trying to move as quickly as we can to confirm people so that we can all get back to work and begin to do some things for our country.

And so I look forward to this hearing, Mr. Chairman, and am glad to participate with you. Thank you.

SEN. REED: Thank you very much, Senator Akaka.

Let me now recognize Mr. Rogoff. Mr. Rogoff, again, if you would like to introduce your family or friends that are here, please take this opportunity, and then your statement.

MR. ROGOFF: (Off mike.)

SEN. REED: Could you please turn on your microphone, Peter?

MR. ROGOFF: I would like to introduce them. And thank you, Senator Bennett and Senator Reed, for your kind comments.

I'd like to introduce my wife, Dina Morris, my son, Niles Rogoff; and my daughter, Lucy (sp) Rogoff. And I especially want to recognize the person who really makes everything that the four of us do possible, outstanding nanny and great friend, Maline Deli (ph).

Senator Reed, Ranking Member Shelby, Senator Bennett, and members of the Committee, I want to thank you for allowing me this opportunity to present myself as President Obama's nominee to head the Federal Transit Administration.

Having served on the staff of the Senate committee for 22 years, I know that the confirmation process is one of the most critically important constitutional responsibilities in the Senate, so I come to this hearing with humility and a great respect for the process.

As I appear before you today, I believe public transportation faces both remarkable opportunities and serious challenges. The opportunities begin with the fact that we have a president who recognizes the central importance of our transit systems to our quality of life and to the quality of our environment.

He has spoken of the need to invest adequately and invest efficiently, and he has stressed repeatedly the role that public transportation must play in reducing pollution, including greenhouse gas emissions and moving towards energy independence by diminishing our reliance on foreign oil.

In addition, the American people are creating opportunities by utilizing transit services in record numbers and by demanding more.

Transit ridership rose to a modern record in 2008 -- more than 10 billion trips. What may be more remarkable is that ridership has remained high, even as record gas prices have dropped back down.

Many families have sold their second car or their only car, either as a matter of convenience or to cope with the economic downturn. Many other Americans, weary of sitting in traffic jams, have just boarded the train or boarded buses using designated bus lanes.

Finally, there are great opportunities because the administration and Congress are about to rewrite all our surface transportation programs, Senator Shelby pointed out. In fact, the upcoming authorization process presents an opportunity like no other to retool our public transportation programs and refocus them on our most critical national goals.

But as this Committee is well aware, we also face extraordinary challenges. First and foremost is the task of financing our efforts to achieve these goals. The mass transit account of the Federal Highway Trust Fund is on a path to insolvency.

While the transit account is in less immediate danger than the larger highway account, the balances in both are falling at a rate that will undermine their ability to support current obligations.

The financing challenge calls for tough choices. So it's all the more important that we fulfill President Obama's commitment to spend every transit dollar efficiently and on the worthiest projects.

Against this backdrop of both challenges and opportunities, I'm especially honored that President Obama has nominated me to serve as his Federal Transit administrator.

I very much look forward to working with this Committee, with Secretary LaHood and his outstanding team to both tackle the pressing challenges and capitalize on the extraordinary opportunities.

As I mentioned, the financing dilemma is difficult, but with more than two decades of experience on the Appropriations Committee staff specializing in transportation finance, I feel confident that I could help the secretary and this Committee identify a more stable and sustainable funding regime.

Secretary LaHood has made clear his intention to eliminate the stovepipes within DOT. I think that's something that people have been trying to do since Senator Bennett served in the DOT. (Laughter.)

He will be asking his agency leaders to work toward a seamless system that moves people and freight efficiently between modes of transportation, and I believe I can help. My experience in infrastructure investment programs goes well beyond mass transit. It includes highway, aviation, intercity rail and maritime programs.

If we are going to succeed in developing truly seamless networks, then expanded cooperation and joint investments are going to be key.

Secretary LaHood and HUD Secretary Donovan are committed to fostering livable and sustainable communities through their coordinated efforts of their departments. And let me just point out how apt I think it is that I'm testifying with a number of HUD nominees, because there really is quite a lot of overlap in the challenges we're trying to address.

For the last four years I've had the joint responsibility overseeing both the Transportation and HUD budgets for the Appropriations Committee. Knowing the HUD budget as I do and witnessing Secretary Donovan's impressive efforts to transform HUD, I'm particularly enthusiastic about working with him and Secretary LaHood to promote sustainability.

Finally, I want to welcome the opportunity to be this administration's advocate for mass transit. I plan to be a very public advocate in my visits with policymakers in communities across the nation.

But just as importantly, I plan to be a forceful advocate in the less public debates that go on within the administration.

We must create new and better transit options in both urban and rural America. But especially during a period of economic uncertainty and recovery, a pro-transit agenda must include protecting and improving transit services for those for whom mass transit is the only option.

If confirmed, this Committee can count on me to be a strong and vocal partner in advancing this agenda. I thank you again for this opportunity and the kind words of the members of the Committee.

I look forward to answering any questions you may have.

SEN. REED: Thank you, Mr. Rogoff.

And Senator Martinez has arrived, with perfect timing, to say a few introductory words about Mr. Sanchez.

Senator Martinez.

SEN. MEL MARTINEZ (R-FL): Thank you, Senator Reed. I appreciate that very, very much.

Well, I want to take a moment -- and I know Senator Nelson was here earlier, but -- to introduce to the Committee Frank Sanchez, a wonderful Floridian, a man who's exercised a great deal of leadership in the area of trade, not only nationally but also in the state of Florida. And also a proud alumni of Florida State University, for which I'm very proud to share that with him.

But in addition to his fine academic record, which I know Senator Nelson probably described, I find Mr. Sanchez to be someone who is going to make an excellent trade person for our country because of his past work, not only in the private sector, but also in government.

He had a great deal to do with negotiating the Open Skies Agreement, which was approved during the Clinton administration, which is so important to our nation's airlines and to others around the world.

And it is about trading with others, at the end of the day, that can create so much prosperity for our country.

So I have had the opportunity to talk with Frank about his commitment and his understanding of the importance of trade as we go forward in so many of these areas that are today pending -- Colombia, Panama and other issues that you know so well.

So Mr. Chairman, I just wanted to add my endorsement and my introduction, and look forward to a swift confirmation of Mr. Sanchez, a great Floridian.

Thank you.

SEN. REED: Thank you very much, Senator Martinez -- another great Floridian, I think, truly.

Mr. Sanchez, if you'd like to introduce family and friends, please do so, and then we'll be eager to hear your statement.

MR. SANCHEZ: Thank you, Senator Reed. I wish to introduce my cousin, Kim Sanchez, who has the awesome responsibility of representing the entire Sanchez clan today. (Laughter.)

It truly is an honor to be before you today with this distinguished panel, and I should say I hope that some of the good feelings that Mr. Rogoff has engendered with this Committee, that it'll be able to rub off on me. (Laughter.)

I want to thank Senator Martinez and Senator Nelson both for making a special effort to be here and to introduce me. Thank you very, very much.

I would respectfully ask the Committee that my full statement be submitted for the record.

There is no call -- there is no greater call than that of service to one's country, and I am truly honored by President Obama's nomination of me to serve as undersecretary of Commerce for international trade.

I am humbled by the trust that President Obama and Secretary Locke are placing in me, and I am cognizant of the serious responsibilities that accompany this confidence.

If confirmed, I look forward to working for them and with you in advancing our nation's economic well-being and ensuring that all Americans benefit from fair and free trade.

I would like to take just one moment to thank someone who is not here -- actually two -- my mother and my late father for their support and encouragement. I would not be here if it weren't for their consistent and constant love and commitment to my success -- so I want to thank them.

As Secretary Locke has said, the role of the Department of Commerce is to be the engine of innovation, of job growth, and of economic renewal. The International Trade Administration supports these efforts by strengthening the competitiveness of U.S. industry, promoting trade and investment, and ensuring fair trade and compliance with our trade laws and agreements.

This mission is critical to enhancing America's global competitiveness and expanding commercial opportunities for American manufacturers and service workers throughout the world. When U.S. business seeks to promote their goods and services in overseas markets, it's the International Trade Administration's programs that lead the way. In short, the agency helps America's firms and workers navigate through the often complicated and unpredictable waters of foreign trade.

If confirmed, I look forward to working closely with this committee to support American innovation and entrepreneurship and open global markets for American-made goods and services. In so doing, we can play a vital role in creating new jobs and economic growth here at home.

I thank you for your consideration.

SEN. REID: Thank you very much, Mr. Sanchez.

Mr. Bostic, again, if you have family or friends, feel free to introduce them and then your statement.

MR. RAPHAEL W. BOSTIC: Sure, I would like to introduce my parents, my mother and father Viola and Raphael, who are here, as well as my sister Ebony, who is making her own sacrifice as she's letting me use one of her rooms as my base as I'm here in Washington -- so thank you, Ebony.

I would also like to acknowledge two people who were unable to be here: my partner Jeff Taylor, who is back in California; and my aunt, Patricia Williams, who is in New York.

Chairman Reid and members of the committee, I am honored and humbled to appear before you today as you consider my nomination to serve as the Assistant Secretary for Policy Development and Research at the U.S. Department of Housing and Urban Development. Before going further, in addition to my family I would like to acknowledge a few others who have been instrumental in my life -- particularly mentors Glen Canna (ph), John Schovin (ph), Roger Noll (ph), Susan Lochter (ph), and Stewart Gabriel.

The time we find ourselves in is remarkable, both because of its gravity and its origins. By many measures, the economy has not performed so poorly since The Great Depression of the 1930s. For perhaps the first time in the nations' history, housing has been at the root of this macroeconomic trouble.

This reality means that a deep understanding of housing markets is critical and evidence of what does and does not work in these markets will be essential for creating a new market structure that endures and corrects the weaknesses that helped to create the current troubles.

Secretary Donovan recognizes this and in his public and private statements has already placed a considerable emphasis on the importance of collecting and using data to make informed decisions. If confirmed to my position, I will work hard to see that the Secretary's vision is pursued and achieved. In this way, I hope to contribute to a transformation of the Department into an efficient, informed leader of policy on issues associated with housing and urban development.

My background, including significant work in academics, government, and community development, provides me with assets that will allow me to help the Office of Policy Development and Research increase its efficacy and effectiveness. A key goal is for PD&R efforts to contribute to a deeper and more meaningful understanding of the issues facing our housing and urban markets and communities.

From an academic perspective, my research has given me knowledge and insights about both housing and urban development and this, coupled with my continued and intensive interaction with other academic scholars, will allow me to promote the implementation of evidence-based policy with the Secretary and the Department's program offices.

In addition, my training and perspectives gained as an academic researcher have given me skills that will help ensure that research and program evaluations produced or funded by PD&R are relevant, timely, and of the highest quality.

Through my career to date, I have interacted extensively with all the key HUD constituencies and so I am able to add value and perspective to HUD's research efforts -- as well as its policymaking and oversight. I understand housing and housing finance through my research and my work at the Federal Reserve Board. I know the nuts and bolts of affordable housing development as well as the difficulties and opportunities it affords for lower income and minority households through my teaching them at USC, service as a board member of a local nonprofit housing developer, and my research.

My work with the local community development organization in East Palo Alto and other research I have done, have provided insights as to the challenges of broad-based urban and community development. My role as director of a real estate development program required my engagement of all aspects of the development process and forced me to engage and understand how design, law, economics, finance, and construction all interact. Of particular significance, the exposure to construction highlighted the key role that engineering and technology can play in helping to make housing affordable and high quality.

One of Secretary Donovan's top priorities is to improve the culture of the Department as an institution and I pledge to further this goal for PD&R. This transformation will require significant organizational management and my experiences at USC over the past several years have prepared me for this challenge.

I aim to provide an environment that allows PD&R to perform and produce at high levels, as I believe the office has tremendous potential that has lagged in terms of its productivity and prominence.

Finally, I come to you today with the clear understanding of the opportunities and obstacles that this position presents. Through my work at the Federal Reserve Board and HUD, I have seen how policy is created at the federal level and I am familiar with the dynamics associated with operating at PD&R. This knowledge base will facilitate my navigation of the policymaking milieu and should lead to effective decision-making and promotion of ideas that will benefit the American people.

In conclusion, I am very excited to serve the country at this pivotal moment in its history. I am eager to support the Secretary's efforts and work with the members of this committee to help heal the nation's housing markets and promote the flourishing of its urban areas.

Thank you for giving me the opportunity to speak with you today and I welcome any questions you might have.

SEN. REID: Thank you, Mr. Bostic.

Now, Ms. Henriquez--

MS. SANDRA HENRIQUEZ: Thank you, Senator Reid.

I'd like to introduce -- with me today are my father Howard Brooks, my brother, Bruce; my daughter, Sandra Elena; my son, Carlos, and a colleague from the Housing Authority, DeRon Bolton (ph). My other son remains in Boston but I am certain he is watching this proceeding, as are my colleagues at the Housing Authority.

Thank you, Mr. Chairman, Senator Shelby, and distinguished members of the committee for considering my nomination and the opportunity to appear before you this afternoon. I am truly honored and humbled to have had Secretary Donovan recommend that President Obama nominate me as the Assistant Secretary for Public and Indian Housing.

I want to thank Congressman Frank for introducing me here today and for Senator Kerry's written statement for the record.

The most significant portion of my more than 30-year career has been in real estate property management of affordable housing -- both for the private and the public sectors of the industry. I quickly turned to residential real estate because I was more interested in the people who were there than the commercial side. I believe that housing is a right and that the provision of safe, decent, and well- cared-for housing for low and very low income families and individuals lays the foundation to change lives.

If a family shelter is secure, then that household can begin to work on other aspects of their lives that many of us take for granted, such as child care, getting a job, finding a better one, and education for themselves or for their children.

For the past 13 years, I've been the administrator and the Chief Executive Officer of the Boston Housing Authority. As the largest single landlord in the city of Boston and one of the largest public housing authorities in the nation, the BHA provides 11,500 public housing units and 13,000 rental assistance subsidies -- together housing 10 percent of the city's population. With an 850-person work force and program budgets exceeding $280 million annually, I've led an outstanding team to reform the Housing Authority from near troubled status to that of high performer in its public housing and in its Section 8 portfolio.

Following real estate industry practices and policies, the BHA moved to ask that management models before Congress and HUD required it. We embraced the basics and vacancy rates dropped from 15 percent to two to three percent across the portfolio. Non-emergency work order completion times dropped from 120 days to 15 and they continue to fall -- and rent collections are up.

At the same time, we moved from being labeled by HUD as systemically discriminatory to a national model of fair housing. We partnered with sister city agencies, local community development corporations, and other nonprofit housing providers to increase the production of affordable rental housing. We created housing strategies and programs to house the homeless and we introduced green principles into our business practices and into our building maintenance and construction operations.

The Boston Housing Authority has used the Hope 6 program to redevelop three properties, with a fourth just beginning. In addition, we created 62 new first-time home buyers, none of whom are in default or foreclosure. We have used mixed financing to develop two other properties and when redevelopment is taken all together, they total almost $1 billion.

For every federal or state dollar, we leveraged eight more. We have used energy performance contracting to retrofit many of our outdated heating plants, making them state of the art, more efficient, less costly to operate, and creating better living environments for our residents. In addition, we have used available HUD programs to use a portion of our ongoing capital allocation to leverage bond financing to expand ongoing improvements to the physical plant. Coupled with the recent American Recovery and Reinvestment Act funding, this totals more than $110 million.

My housing experiences taught me that regardless of the price point, maintaining and improving properties is essential to those who live there. Preservation and improvement of the 1.2 million units of public housing stock, the creation of more affordable rental housing, as well as the continued ability to support families and individuals through rental assistance, is essential to realizing the dream of millions of our citizens.

Secretary Shaun Donovan's commitment to accountability and transparency and his leadership at HUD provides for the opportunity to do our best work on behalf of those who benefit from HUD's programs.

If I am confirmed, I will be focused on and committed to learning more about Native American housing as well as public housing. I'm grateful that President Obama has nominated me and I want to thank each of you this afternoon for your consideration of my nomination. If confirmed, I look forward to serving the nation, especially those who live and work in public and Native American housing -- thank you.

SEN. REID: Thank you very much.

Ms. Márquez.

MS. MERCEDES MARQUEZ: Good afternoon. There are many friends here today and I thank them for traveling so very far -- including from as far away as Hawaii today. I also want to take the opportunity to introduce my partner of 21 years, -- (inaudible).

It's my pleasure to be here before you today, Mr. Chairman and members of the committee. I am honored to have been nominated by President Obama to be the Assistant Secretary for Community Planning and Development.

I also want to thank Secretary Donovan for giving me the opportunity to join and excellent team of professionals dedicated to ensuring quality housing for every American.

I started my career as a civil rights litigator. I have represented folks in matters involving substandard housing conditions, classics for housing cases, and federal class actions relating to community gentrification, and discrimination in public housing. Through this work, I learned the value of decent, safe, and affordable housing within the context of a health neighborhood.

After a dozen years of litigation, I was appointed by President Clinton to the U.S. Department of Housing and Urban Development -- first as the Deputy General Council for Civil Rights and Fair Housing and later as Senior Counsel for Secretary Andrew Cuomo. At HUD, I helped to craft what the Secretary referred to as HUD's "Justice Agenda." This required us to reach across divisions to assemble and lead cross-departmental teams. For example, to examine the possible discriminatory use of CDBG dollars, we put together a team from Community Planning and Development, Fair Housing, and the Office of General Counsel. Through this work, I learned the intricacies of the funding programs which fall within the purview of Community Planning and Development.

While most of my work centered on urban communities, I also was privileged to work in rural areas. My work included the design of HUD's first rural housing and economic development methods, worked in the Colonias (ph), and the launch of the Self-Help Housing Program on the Pine Ridge Reservation in South Dakota. This work touched me personally. I am the granddaughter of farm workers and I spent a considerable amount of my time visiting family in the San Joaquin Valley of California. It was my honor to give something back.

After my experience at HUD, I went back home to Los Angeles to practice housing and community development. The vice president of McCormack, Baron, Salazar, one of the country's most successful private affordable housing developers, I spent three years taking affordable housing deals from concept to the final securing of financing. I have spent the last five years as the general manager of the Los Angeles Housing Department.

The agency had a long-standing reputation for antiquated thinking, inadequate infrastructure, and the lack of transparency. Within my first year, we achieved a top to bottom assessment and called in all of the stakeholders -- always seeking to become public sector entrepreneurs, building momentum while working with the market instead of lagging behind it.

We also initiated Project Clean House, an effort that identified the 50 most underperforming deals and brought the developers in to meet with us. We were able to get the majority of the deals back on track and completed. As for the rest, over a two-year period, we recaptured or de-obligated either voluntarily or through judicial proceedings, over $50 million and put every penny back into the financing of affordable housing. We were able, through that effort, to launch the city's permanent supportive housing program.

In partnership with lenders, philanthropy, and the enterprise community partners, we successfully implemented the new generation fund, a $100 million acquisition capital fund. This fund works to provide acquisition, pre-development, and get financing to affordable housing developers in a transparent and competitive system.

Now our biggest challenge is the current economic and housing crisis. Los Angeles has experienced over 24,000 foreclosures in the last nine quarters. We address the foreclosure crisis in thoughtful and innovative ways. Early on, we invested in data. Los Angeles is 469 square miles in size and our investment in and development of GIS maps gave us the information we needed to understand the true nature of our problems and where to expend the $32.8 million Los Angeles received from NSP-1. We identified distinct neighborhoods where we could also achieve other goals like transit-oriented development and the perseveration of affordable housing in multifamily units.

Restore Neighborhoods L.A., a nonprofit we set up to acquire and dispose of vacant properties, is already up and running and making purchases. As a practitioner, I have learned and worked with HUD's rules and I know that they don't often take into account that one size does not fit all. If confirmed, I commit to bring a disciplined focus to CPD and will work to ensure accountability, transparency, expertise, and flexibility that support the efforts of local government to achieve meaningful community development.

It would be an honor to serve. Thank you for your attention and I look forward to any questions you may have.

SEN. REID: Thank you very much.

Mr. Barr, please.

MR. MICHAEL S. BARR: Thank you very much, Senator Reid and distinguished members of the committee. It's my honor to appear before you today as the nominee for the position of Assistant Secretary of the Treasury for Financial Institutions.

With me today are my wife Anna Smatrich (ph), behind me, my children, Avital (ph), Deni (ph), and Etai (ph); my mom Deborah Barr; my sisters, Karen and Lisa; my uncle, Gabe and my cousin, Jake (laughter); my wife's parents David and Bunny Smatrich; and family and friends who have known me my whole life.

MR. SANCHEZ: Are you Cuban by any chance? (laughter)

MR. BARR: They're all representing the rest of the Sanchez family (laughter).

I'm sure my dad David Barr is here with us in spirit as well and I would not be here today before you without their love and their support. I'm enormously indebted to them for the sacrifices they are making on behalf of me and I hope the country. My parents taught me the centrality of public service. My mom is still a high school English teacher here in Washington, D.C.; gives her all to her students every day. My dad was a labor lawyer who represented hardworking Americans for his whole life. And I am humbled by their experiences and by the faith that President Obama and Secretary Geithner have placed in me during these extraordinary times.

The President and the Secretary have moved aggressively to stabilize our economy and our financial markets to provide relief to struggling homeowners and strength to our mortgage finance system. The administration has put in place initiatives to help small business, consumers, and students and to restore the health functioning of financial markets. While they address the current crisis, the President and the Secretary are committed to fundamental reform to reduce the likelihood of crises in the future and to contain such crises if they occur.

The current financial crisis has revealed significant weaknesses and glaring inconsistencies in our system of financial regulation. If confirmed, I look forward to working closely with you to take the necessary steps to reform our financial system and to restore honesty and integrity to our financial system.

We need a comprehensive and effective system of prudential supervision and effective measures to reduce systemic risk. We need clear accountability and full transparency. We must ensure that we put in place robust protections for consumers and investors with strong and uniform enforcement.

We must ensure that our financial system is inclusive and fair. And we must have a system that evolves over time to keep up with the pace of financial innovation domestically and globally. With the right changes in place, we can expect our financial system, once again, to be vibrant and strong.

I come before you having had the privilege of working on financial issues for a long number of years -- currently as a professor of law at the University of Michigan Law School, where I teach financial institution regulation and international financial regulation. My research involves research on financial policy and financial regulation; it most recently involves extensive empirical research on the needs and behaviors of consumers in our financial services system. My work focuses on ways in which a deeper understanding of how people think and behave, based on real world research, can better inform public policy rather than relying solely on abstract models of interaction.

Prior to joining academics, I served in senior positions in United States government -- at Treasury Department for six years; at OMB, at the State Department, and as a judicial clerk. I would say that these positions gave me the opportunity to work with many of you and your staffs to contribute to the work involving changing our financial system and to gain the experience to know that an open mind and honest dialogue lead to better policy judgments.

I am hopeful that my experiences to date will serve the Department well if I am confirmed. I am even more hopeful about the future of our nation. If confirmed, I look forward to working together with you to lay the foundation for a sound recovery and a strong economic future -- thank you very much.

SEN. REID: Thank you very much, Mr. Barr. What I'd like to do is take seven-minute rounds and make allowances for a second round if there are additional questions -- I assume there will be.

Let me begin by asking Mr. Rogoff, the New Starts process; there's been criticism about it, the fact that it takes a very long time to get the process off the ground and there are many desirable projects that just don't seem to be able to make it into the mix -- that's one dimension.

The other dimension I'd like you to comment on is that the tension between funding New Starts projects and continuing to improvements and expansion of existing projects -- and if you could just generally comment, I'd appreciate it.

MR. ROGOFF: Well, I would certainly agree with some of the criticism that has been leveled against the extraordinary time delays that have encumbered a number of the new New Start projects; it's a situation that I don't really know anyone either in industry or who works around this process that is at all content with it. I have strong views that I think there are ways to streamline it. I think it's one of the first and most important exercises that I'd like to go through, if confirmed.

If I don't launch such initiative myself, I'm kind of hoping that Secretary LaHood will order me to do it, just to bring it the high level visibility that I think it needs. The reality is, the longer these approval processes take, the more expensive these projects get. Inevitably, that means within a fixed dollar amount of limited funds that we're going to be able to put into these projects over the next several years, that means we're buying fewer projects; we're buying fewer, more expensive projects for having taken a year, two years, three years longer than we perhaps should have to approve them.

Now, no one wants to bypass any of the laws and regulations that apply to these approvals, but there's got to be a faster way to get them through the process.

As it relates to funding, New Start projects -- I think what you're asking is sort of keeping up the maintenance on existing infrastructure.

SEN. REID: And expanding, yeah.

MR. ROGOFF: It is difficult in that we've just had, as a result of a report that Senator Durbin ordered through the appropriations process, really quite a wake up call in a report that showed that we're looking at something along the lines of a $50 billion backlog in deferred maintenance -- really necessary maintenance -- on a number of our major rail systems across the country, including the MBTA up in your region of the country. Some of these deferred maintenance issues really quickly become safety issues if you don't attend to them.

I think this committee, as well as the FTA and the administration, really need to carefully balance how much they want to commit to building new projects versus seeing to it that the existing systems are actually adequately attending to their core maintenance needs. It's hard when you think about the local political situation.

It's a lot easier to kind of generate enthusiasm, perhaps generate an incremental tax, generate money out of the legislature when you've got a lot of people excited about a new service.

It's a lot harder to cobble together the money to actually do adequate maintenance -- so I think that's a careful balance we need to look at.

SEN. REID: Thank you, Mr. Rogoff. Let me move to Mr. Bostic.

Mr. Bostic, I note that in your resume you were an independent director for IndyMac MBS, Inc, and IndyMac ABS, Inc. We all well know that the failure of an affiliated company, IndyMac Bank, caused severe repercussions -- in fact, it was alluded to by Congressman Schiff.

If you could explain exactly what your role was with these entities, whether you were engaged in any of the activities of the bank -- with their underwriting or their marketing et cetera. What precisely were you doing as an independent director for these affiliated entities?

MR. BOSTIC: To answer that question, I should start by just describing the relationship between IndyMac, the bank, and the affiliate that I was on the board of. IndyMac Bank was a bank that took deposits; they made loans. One of their strategies was to fund those loans by accessing the liquidity from the secondary market. As you may be aware, there are a bunch of processes that you have to go through to actually get a pool to the secondary market. The affiliates, MBS and ABS, were charged with working through that process to get those pools to be made available on the secondary market.

My role as an independent contractor was to oversee the activities of those affiliates and make sure that the processes were done appropriately in conformity with SEC rules and regulations and those sorts of aspects of the infrastructure. At no time was I charged or did I have the authority or responsibility to do underwriting, to review the decisions of how to pool these securities, the deal structure. I was largely a board member just overseeing this process.

So I was relatively detached from the actual underwriting decision-making.

SEN. REID: Thank you very much.

Mr. Sanchez, let me ask you a question basically that you will be the chief officer in our government that is policing the anti-dumping and the dumping issues that face us. I wonder if you could give us sort of a sense of how you might approach that very important challenge.

MR. SANCHEZ: Thank you, Senator Reid. ITA and my role as Undersecretary of Commerce, I have two important responsibilities: promoting exports and, secondly, ensuring that we've created a level playing field for American business as it seeks to do business around the world.

I consider it one of the most important tools that we have to vigorously enforce our trade laws as well as our trade agreements. It will be my intention to do that, to enforce them, to our utmost ability to work with USTR to make sure that we're doing everything to make sure that American business can remain competitive.

If confirmed, I look forward to working with you and this committee to make sure we're doing just that.

SEN. REID: Well, thank you very much. I'll reserve my questions for the second round. I recognize Senator Martinez.

SEN. MEL MARTINEZ (R-FL): Thank you, Senator Reid.

I want to just make a general comment. All of you are coming to do things for this nation that you love and I just want to commend all of you for doing so. I want to also express a word of thanks to your families and friends and supporters and partners and others that are behind you and support you in your efforts. I think it's terribly important -- I can just think back eight years ago when I was sitting at the same table where you sit today before I had the honor to be Secretary of HUD.

So I want to just make that general comment. I have a couple of questions to each of you and I will try to go quickly about that.

Mr. Rogoff, I wanted to ask you about the transit issue in terms of financing and funding. I come from a state where we have little to none and are having a very difficult time getting projects off the ground. We just had a tremendous failure in central Florida you may be aware of.

MR. ROGOFF: I am.

SEN. MARTINEZ: What do you think are the answers and how do you feel about the private financing of major projects that might use a different model than what we traditionally have used?

You know I've been involved in a project for a light rail program in Orange County, Florida. It failed because we couldn't really come up with a local match.

This one failed because the State of Florida couldn't do its part. This model is broken. How do you think we can get it done, because mass transit is something that has to be part of the future of Florida?

MR. ROGOFF: Well, that's correct and especially in growing states like Florida that continue to grow and continue to have density of elderly, it becomes all the more important with the aging of the population.

As I said in my opening statement, our core mechanism for financing these programs, the transit account of the Highway Trust Fund is on its way towards bankruptcy. There are some measures taken in the President's budget or 2010 to try to forestall that but the bottom line is we need to develop some new financing mechanisms.

We've had two commissions that have looked at this, both authorizing the Safe -- (inaudible) -- Bill and I think what's most notable about them is that both commissions, while coming up with different recommendations, all agree that we need of a mix of solutions, that we're not going to have a single silver-bullet mechanism, if you will, to revolutionize transportation finance, and private public partnerships needs to be part of that.

I mean, the challenge in doing private financing for certain transit projects is we need to get -- you know, what often interests the private sector in being a participant is being able to capture some kind of revenue stream for pay back.

SEN. MARTINEZ: Right.

MR. ROGOFF: Transit projects, you know, generally need an operating subsidy to continue to operate and therefore there is some sort of a natural mechanism, a natural funding stream to capture, but there have been some innovative mechanisms used out there.

I think the one thing that really all of the committees that are going to participate in authorization process, this committee, the Public Works Committee, the Commerce Committee need to focus on is some of the most innovative ideas are coming from the states and localities themselves, that we need to open our ears to some of the things that are being successful out there and try to give state and local decision makers sort of maximum options.

My only concern about the private public partnership model is when you get into some sure privatizations where transit assets, if you will, are sold and some of the funding from those assets don't necessarily go down to transportation benefits and I think that's a point where we need to draw a line, but clearly we had some successful projects out there and we need to foster them.

SEN. MARTINEZ: Look, you've been over mine in Florida. We desperately need transit and I hope that we can find a way to make it happen.

MR. ROGOFF: Absolutely. The recent activities in Tallahassee were unfortunate. I agree.

SEN. MARTINEZ: It really was.

MR. ROGOFF: (Inaudible.

)

SEN. MARTINEZ: Very unfortunate.

Mr. Sanchez, I just wanted to make sure that I get on the record here I know what your thoughts are on trade. I'm very keen on the Columbia Free Fair Agreement. I think it's terribly important for our exports. It's a market where we will gain jobs by trading with Columbia on a free trade basis and I want to know your thoughts on that agreement and the Panamanian one as well.

MR. FRANCISCO SANCHEZ: Well, I know that President Obama recently said that we have to be very careful that we don't send signals of protectionism particularly during these economic times.

I know that the U.S. Trade Representative Ron Kirk is working with our good partner and ally, Columbia, as well as Panama, to work out any concerns or issues that may still exist. As you know, I'm not yet working for the administration so I have not been involved in those discussions, but I am confident that the U.S. Trade Representative with support from the Department of Commerce will be able to work through issues with Columbia and Panama, and I'm hopeful at some time in the future, we'll be bringing those agreements to Congress.

SEN. MARTINEZ: Well, Senator Gutierrez, who I happen to have seen today and I know you know, was a huge advocate for the trade agenda. I hope you will pick up that mantle along with Representative Kirk who is I know going to do a great job as USTR, but I hope you will join with him and I know the Secretary is also very committed pro-trade person, has a great record in his state when he was governor along those lines.

So I think it's terribly important that we move the agenda forward. I think it's very important for our political relationship with Latin America, as you well know, that we address that issue as soon as possible.

MR. SANCHEZ: I agree, Senator. As Senator Reed said, one in ten jobs in the United States come from our exports and Secretary Locke's home state by some estimates is one in three. So you're absolutely right. It's an important engine of job creation in our country.

SEN. MARTINEZ: I want to just congratulate all of you HUD people, welcome you to the HUB family if I may be so presumptuous.

I know Ms. Henriquez. I think our paths crossed when you were in Boston and I was at HUD and I know what a great job you are doing there. I also have to tell you the whole public housing arena is a challenge. Not all of them work as smoothly as yours. I know there's come terrific examples around the country of well run. Atlanta comes to mind. Many others, but then there is also some really, really disastrous situations and I hope that you will use your firm but gentle hand to make sure that we move that situation to a better place.

As you said, every American ought to have a decent place to live and not every American in public housing does, so I really hope you will take seriously that challenge.

MS. SANDRA HENRIQUEZ: I will and I do. Thank you.

SEN. MARTINEZ: Ms. Márquez, I also commend you for your passion about housing for all and equality. I did a lot in the Colonias (ph), maybe not a enough, because I don't know how much would ever be done to be enough, but I promise you it's an area that I took a great deal of interest in and there's so much of the agenda that I could discuss with each of you, but in the interest of time I hope you will look at some of the things we did in the Colonias.

I hope that they're still there to be followed up on and pursued and advanced -- there's no constituency I used to say for the Colonias. You know, you don't get any votes. You don't win any medals. Nobody really knows or cares what you are doing but you have to only visit it once to realize that no American should live in the conditions as some of the people in the Colonias are living and so I hope you will continue to see if there is a way through CPD dollars that you can address some of those issues.

You know, they don't qualify exactly as such. We were creative in ways of finding ways to help and I hope you will be equally creative with them. That's not a question really but if you have a comment, I'd love to hear from you.

MS. MERCEDES MÁRQUEZ: It is difficult when you approach the Colonias and you find that HUD has one standard for a sewer hookup and (USDA's ?) Rural Housing has another and they are about six feet apart from one another.

SEN. MARTINEZ: And there's not enough money for either one.

MS. MÁRQUEZ: That's right.

SEN. MARTINEZ: (Laughing.)

MS. MÁRQUEZ: I promise you I will give my very best effort.

SEN. MARTINEZ: Yeah. Thank you.

And there's so much -- CPD, you know, I mean, it is the life blood of so many cities and today in these difficult times that we're facing municipalities all over the country are looking to you for the leadership that has to come out of HUD for so many community projects that are vital, particularly now that we're trying to put people to work and everything else. So --

And, Mr. Bostic, I'm not I'm not sure I ever understood fully what all of you people do over there in the research area.

(Laughing.)

And so I would just wish you well and do good things.

(Laughing.)

I mean no disrespect there.

Thank you, gentlemen.

Mr. Barr, also congratulations to you and I wish you well in your job. You have a huge challenge ahead of you and look forward to working with you through the --(inaudible) -- Committee. Thank you.

Thank you.

SEN. REED: Thank you, Senator. Now we know and can see why you were such a successful Secretary. Your insight and -- (laughing) (cross talk.)

SEN. MARTINEZ: Good people and -- right.

SEN. REED: -- and inspiring leadership.

SEN. MARTINEZ: That's right.

SEN. REED: Thank you.

Senator Akaka.

SEN. AKAKA (D-HI): Thank you very, Mr. Chairman.

Mr. Rogoff, due to your work on the Senate Transportation Appropriations Committee, you are probably aware of many things throughout the country, including Hawaii?

MR. ROGOFF: Yes, sir.

SEN. AKAKA: And in particular the city and county of Honolulu and its efforts to construct the rail transit system, and it was good for us to hear that you will be the man -- (inaudible) -- for this administration and we certainly look to you for improving the system and looking forward to working with you.

The local contribution towards the project in Honolulu will likely be so many percent of the project costs, but we will still need significant federal support.

This project is coming to a very critical phase of development in Hawaii and it will -- in Honolulu and will require the regular attention of the FTA.

Can you off some assurance that the FTA will devote appropriate time and attention to the rail transit project in Honolulu?

MR. ROGOFF: I certainly could, Senator. I have toured the corridor of this project. I have met with Mayor Hannemann on more than two occasions to discuss it and I agree with you that we are now reaching a make or break point on the Honolulu project.

I am fortunately, along with a former colleague of mine, Pat McCann, who is here today, was serving at the subcommittee when the City Council reversed itself and undid the project in the 1990's and we went through the very unfortunate exercise of reallocating funds already appropriated to Honolulu to other cities and we must not let that happen again. And you have my assurance both in working with the people in Region 9 as well as within headquarters to make sure that everyone is talking to each other and clearly in terms of what needs to be done to move this project forward.

SEN. AKAKA: Thank you very much for your response.

Mr. Barr, among those families who make up the bottom 20 percent of earners, one in four does not have a transaction account, according to the Federal Reserve's survey of consumer finances. These families are those that can least afford to pay the high cost of fringe financial services and I know we share an interest in helping to increase access through mainstream financial institutions.

I value your scholarship on banks and look forward to working with you to help increase access to mainstream financial institutions and my simple question to you was what must be done to bank the unbanked?

MR. BARR: Thank you very much, Senator Akaka, for your kind words. As you know, I've been working on issues facing low income households in the financial system for a long time. It's an area of deep concern for me in my scholarship and my policy work, and it's nary that I would look forward to continuing to work with you on, if confirmed on for this position.

I think there are a large number of efforts we can make to help bring more people into the financial services system if we focus on their actual needs and start with what people need from their banks, what they need from their financial institutions, rather than determining from the top down, the current structure of the financial system, so I would very much look forward to working with you on this important issue.

SEN. AKAKA: Well, I look forward to that, too.

Ms. Henriquez, as you know, in Native American communities, affordable housing development on trust lands requires unique and innovative approaches. Programs authorized by the Native American Housing Assistance and Self Determination Act that we call NAHASDA --

MS. HENRIQUEZ: Uh-huh.

SEN. AKAKA: -- have been vital to increasing access to affordable housing. Hawaii's Department of Hawaiian Owned Lands is the largest affordable housing development in our state and has effectively utilized and leveraged federal resources. Hawaii's housing costs are the highest, as you know, in the country.

MS. HENRIQUEZ: Uh-huh.

SEN. AKAKA: And homelessness is too prevalent.

MS. HENRIQUEZ: Uh-huh.

SEN. AKAKA: I encourage you to come to Hawaii and see the work being done by DHHL and meet with the HHL's leadership and homestead residents who would welcome you.

My question to you is will you work with me in an attempt to meet the specific needs of Native Hawaiians?

MS. HENRIQUEZ: First of all, thank you very much for your kind offer. I would look forward to visiting you in Hawaii.

(Laughing.)

Let the record show.

But quite serious I would look forward to working with you, Senator. I think that we've got to figure out what is working, what is not working and then how to leverage as much as possible the tools that we've got in front of us. I understand that there are high costs of living in Hawaii.

I just recently met with the Director of the Hawaii Housing Authority. I learned a lot from him and understand the disparity between what is seen by the tourists and then the actual living conditions for a number of the people who live on the Island.

And so I look forward to working with you and members of your staff to try and figure out ways to leverage as many dollars as possible.

SEN. AKAKA: Thank you very much for your response.

Ms. Márquez, in addition to serving on this Committee, I'm Chairman of the Veteran's Affairs Committee, and we have been working to improve VA services for homeless veterans. Since veterans are approximately one-third of the homeless population, what must be done to ensure that veterans are provided access to assistance and support services to help them find and retain housing?

MS. MÁRQUEZ: Thank you for your question, Senator.

It is indeed a tragedy that -- the statistics that you cite. In Los Angeles we have begun to work on that through a permit supportive housing program. We actually give an incentive for developers to come and build for veterans -- for homeless veterans.

I think what we have to do is put together a leverage and matrix so to speak between our CPD dollars, the new homeless dollars for prevention and rapid rehousing and even layer them on top of NSP dollars. It is very expensive to build permit supportive housing for anyone that has a great need and ultimately we have to leverage both the capital and the operating dollars and so I actually look forward to working with my colleague, Sandy here, because it's going to be together that we work out the final financing to allow permanent supportive housing to go forward.

It has always been a problem. The two systems do not speak together well about capital and operating and that is what I would intend to do.

SEN. AKAKA: Well, thank you very much.. My time has expired.

I want to wish all of you well and the team that you will be part of will certainly help our country without question. So I wish you well and welcome to your families and friends and also your supporters out there.

Thank you.

SEN. REED: Thank you very much, Senator Akaka.

And let me direct the same question early to Ms. Henriquez and Ms. Márquez. I'm just pleased. You emphasize already teamwork.

MS. HENRIQUEZ: Uh-huh.

SEN. REED: You have a unique perspective. You've worked within the agency and you worked outside it. As you go in, what do you think your most significant challenges are, the top three, let's say, from your perspective looking at what HUD has done and can do better and having been there in some cases and tried your best?

Ms. Henriquez.

MS. HENRIQUEZ: Thank you, Senator.

From my perspective I think the top three challenges would be, one, to make sure that we communicating the issue about accountability transparency, top down, bottom up, that we can make sure our programs are effective, we're communicating effectively both to folks who we regulate, housing authorities and our other partners, but also to make sure we hear from those partners about how to be as effective as possible.

I think getting real time data and using that data to drive decisions is really important so that we're not always wondering what shall be included, what's not in the number, how the number works, and how indeed those resources are applied across the nation.

I do think as well getting our arms around a capital needs study to inform decisions, particularly around the public housing portfolio is essential and I know that that work is going on now and I look forward to learning more about how we can use tried and true programs that make some sense and that have been productive and helpful and how we can either replicate those or expand upon those to be more efficient and to produce greater affordable housing across the country.

SEN. REED: Thank you.

And, Ms Márquez.

MS. MÁRQUEZ: Thank you, sir.

I think that the top three things to look at with CPD are clearly the distribution of stimulus dollars, how they're being spent, making sure that that's effective, efficient, and creating jobs.

Secondly, it would be the distribution of NSPQ (ph), the competition which now will focus on need in a different way and having the technical assistance competition done so that we have the expertise around the country to ensure that communities of all sizes and of all types of economies are using these dollars and leveraging as much as possible.

I'd say, thirdly, may be just not -- those are immediate, but the things that absolutely have to be looked at now are some integration of disaster relief work in funding and I'm looking forward to digging in.

You know, in Los Angeles we have disasters. They're called earthquakes. And in my city when we had the Northridge Earthquake, it was my agency that was responsible for the long-term financing of over 20,000 houses and bringing them back on line. So I've spent a lot of time thinking about it, worried that the Big One is coming and planning for that.

So those would be the top three things that I would worry about and then the difficulty always is we're going to have to work across lines. There can be no division. The problems are too steep.

SEN. REED: I notice Dr. Bostic was making lots of notes, which is a good sign because you're already working across divisions, but I - (Laughing.)

But do you have a comment, Dr. Bostic, about --

MR. BOSTIC: Yeah --

SEN. REED: -- how you can help them?

MR. BOSTIC: I'm -- (Laughing.)

You know, it's very unusual to hear program people talk about doing studies and taking data and all that stuff. I get excited and -- (inaudible) --- and I start writing things down.

I guess one of my real objectives with PD and R is to improve the data interface and the availability of data from the Department to serve our external constituency. So a lot of local community groups who don't really have the capacity to do their own data collection and data analysis and I'm hopeful that in working with my two colleagues, we can really change and transform their ability to understand what is going on in their own communities so that we collectively can build programs that really do improve people's quality of life. So --

And the Secretary, I should say, has lifted up data as one of his priorities and so this is really a good opportunity. I think we're all very much aligned and it's really an opportunity for some real good collaboration and hopefully good output.

SEN. REED: Thank you very much.

Mr. Barr, you are going to a position of great responsibility at a critical moment that we are working to prepare major reform legislation for financial supervision.

Just to get a sense of what do you feel the key issues are from your perspective?

MR. BARR: Thank you very much, Senator Reed, and again if confirmed I would look forward to working closely with you and your committee on this issue.

I think President Obama and Secretary Geithner have made clear the importance of fundamental reform to our system of financial regulation. It's reform that needs to be based on several key principles.

We need to be sure that the system does not permit the growth of systemic risk, that we have appropriate systems in place to address the systemic risk and credential supervision.

Second, we need a system that is protective of consumers and investors of a strong and uniform protection across our financial sector.

Third, we need to take the steps necessary to reform our regulatory structure so that it is gap free and comprehensive and so we do not commit the kind of regulatory competition and arbitrage that has occurred in the past.

And fourth, we need a system that enables us to compete internationally and to level the playing field in regulation for both U.S. and foreign firms.

SEN. REED: Well, thank you.

I've had the privilege of working with you and I'm terribly impressed with your scholarship and your commitment to dealing very aggressively and appropriately with some of these very difficult issues.

One area that we've spoken about is that old issue of foreclosure and foreclosure mitigation. We have attempted several times going back to the previous administration on a voluntary basis. We had a first iteration of foreclosure mitigation legislation just last week.

We passed another version and included in that by the way is a reform of the Kennedy Act or Homelessness Act which we look forward to getting passed. I checked with Chairman Frank and he's all for it too, so we think signs are looking good.

But one of the issues we dealt with is the securitization issues and particularly the tax issues of what makes, etc cetera.

Any thoughts about whether the time has come to be more forceful in that area or any other place you might have in sort of a securitization problem?

MR. BARR: Thank you, Senator Reed.

As you know, when I've talked before, I've long been an advocate of forceful measures to ensure that we have strong methods for accelerating, loan modifications and reducing foreclosures.

When President Obama came into office, he made that a top priority and soon after coming into office in February announced a loan modification and stabilization plan with three key elements.

First, additional funding to ensure the capital structure of Fannie Mae and Freddie Mac were strong so those institutions could continue to play an important role in stabilizing prices in the market.

Second, refinance program authorized by the federal housing finance agency to permit more households to refinance even though they're under water.

And third, a clear commitment to an aggressive loan modification plan with commitment of $75 billion in resources and strong treasury guidelines for servicers. And so those two key elements of real dollars on the table are to change behavior and clear legal guidance to perform loan modifications.

I believe we're starting to show significant promise. There have been now thousands of trial modifications that have begun. There are 14 servicers who have signed contracts to implement the loan modification protocols that have been specified. Those contracting firms cover a little bit more than 75 percent of all mortgage loans in the United States.

So I think we're off to a strong start. I think it's early to tell whether it's strong enough. I think we're going to see over time whether the program ramps up in the appropriate way and the administration is committed to ensuring that the program is successful.

As part of that initiative, the Department of the Treasury released some guidance on the issue that you and I have spoken about before, the real estate mortgage investment conduit statute making clear that participation in the Obama modification plan would not disturb that status for existing trusts, which is one of the measures that you and I talked about in the past.

Again, we're committed to continuing to make sure the program works and examining it going forward in the ways that you've indicated.

SEN. REED: It's an arrow that we're still in a quiver of much more explicit sort of response to -- (inaudible) -- but you're going to be -- I presume, and I'm confident you're going to be carefully monitoring the progress of existing measures and if they're doing the job then the arrow stays in the quiver and if not, we have it.

MR. BARR: Thank you, Senator.

SEN. REED: Thank you.

I want to thank all of you, not only for your testimony today but to your commitment to public service and I would ask my colleagues, some who have not been present, may have questions. Those questions will be forwarded to you within seven days of the committee and there may be some. There may be none, but you might get them and your expeditious answer is in your own self interest.

So I can stop right there and I wish you all very, very well in serving the people of this country and the hearing is adjourned.

END.

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