In this issue:

F E D E R A L
HUD's HOME Program Faces Media Criticism

F E D E R A L
Eminent Domain Bill Reemerges in House

F E D E R A L
Congress Considers Administration Proposal for Civilian BRAC

F E D E R A L
Senate EPW Committee Releases Transportation Principles

The HOME Investment Partnerships program is the largest grant program that creates affordable, low-income housing. It awards formula grants to communities for the sole purpose of buying, building, or rehabilitating affordable housing. HUD's partnerships are often with nonprofit groups, which were the target of many of the Post's accusations.

The program generally has received bi-partisan support. In HR 1, the House-passed budget proposal for FY 2012, HOME received $1.65 billion, which is also the President's FY12 budget request. It was a rare moment of agreement in an otherwise hyper-contentious budget battle. In the final agreement for FY11, HOME was appropriated $1.61 billion, which is less than the $1.8 billion it received in FY10, a modest reduction when compared with cuts endured by other HUD programs.

Both chambers of Congress have vowed to launch their own investigations of the claims. The House Financial Services Committee held a hearing on June 3 on the oversight of HOME. On the whole, members from both side of the aisle were supportive of the HOME program. Mercedes Marquez, HUD's assistant secretary for community planning and development, testified that the Post's claims were incorrect and that half of the 700 projects identified by the paper were active projects. Several members mentioned that HUD must monitor the program closely to ensure money is being spent efficiently. Senate Banking Committee Chairman Tim Johnson (D-S.D.) and Ranking Member Richard Shelby (R-Ala.) released a joint statement expressing concern and vowing "to get to the bottom of this issue."

Eminent Domain Bill Reemerges in House
KELO-ERA EFFORT TARGETS ECONOMIC DEVELOPMENT

U.S. Reps. James Sensenbrenner (R-Wis.) and Maxine Waters (D-Cal.) introduced a bill in April prohibiting state and local governments that receive federal economic development funding from using eminent domain for the purpose of economic development. The Private Property Rights Protection Act (HR 1433) would preclude states from receiving federal economic development funds for two fiscal years if the state takes property through eminent domain for private use, effectively prohibiting the practice. The federal government would be prohibited from using eminent domain for economic development altogether. Companion legislation has not been introduced in the Senate.

The bill is nearly identical to legislation introduced in 2005 during the 109th Congress. The original legislation was a reaction to the U.S. Supreme Court's decision in Kelo v. City of New London, 545 U.S. 469 (2005). In that case, the Court allowed the city of New London, Connecticut, to use eminent domain to transfer property from one private owner to another, citing the takings clause of the Fifth Amendment. That 2005 bill was passed in the House, but not the Senate.

HR 1433 could cause major problems for local governments and developers. It allows private property owners to legally challenge property takings by state and local governments up to seven years after the property condemnation, and places a burden of proof on governmental entities to show the taking was not for economic development purposes. If property owners are allowed to legally challenge development even after project completion, developers may find their projects riskier to finance, build, and insure.

The House Judiciary Subcommittee on the Constitution held a hearing on the bill shortly after its introduction. In the hearing, John Echeverria, a professor at Vermont Law School who authored an amicus brief for APA in the Kelo case, pointed out that approximately 40 states already have legislation limiting the use of eminent domain, laws that are localized based on the needs of the individual states. As he said in written testimony: "Only the most compelling national interest could justify such a massive, untimely intrusion into state policy-making, and the case for such an intrusion cannot be made here."

Congress Considers Administration Proposal for Civilian BRAC
LEGISLATORS OFFER BIPARTISAN SUPPORT IN EARLY STAGES

The House Transportation and Infrastructure Subcommittee on Economic Development, Public Buildings and Emergency Management passed the Civilian Property Realignment Act (HR 1734) out of committee in April, laying out a plan to create a civilian version of the military's Base Realignment and Closure (BRAC) process. The subcommittee held a hearing in early April to evaluate whether a BRAC-like process could be used to facilitate the sale of other federally held properties.

Under the legislation, the "civilian BRAC" commission, made up of presidential appointees, would make recommendations on roughly 14,000 federal properties considered by the Government Accountability Office to be unused or underused. Recommendations first would go to the Office of Management and Budget (OMB) for vetting before going to the President for review. The recommendations would then go to Congress for a vote on the package as a whole.

The White House laid out a proposal for a process to consolidate and dispose of underused properties in President Obama's FY 2012 budget request. According to the administration, an independent Civilian Property Realignment Board would expedite the disposal of federal buildings. Economic Development, Public Buildings and Emergency Management Subcommittee Chairman Jeff Denham (R-Cal.) adopted much of the President's proposal in the draft legislation; however, slight differences exist between the President's proposal and the bill ultimately approved by the subcommittee.

The administration's bill includes the National Environmental Policy Act (NEPA) process, which requires federal agencies to consider environmental impacts prior to taking any "major" or "significant" action. But Chairman Denham's bill includes a waiver of NEPA for the property selection process in the interests of expedience. In both proposals, the NEPA process would still be required during the disposal of properties.

OMB officials estimate the one-time startup cost for the process at around $87 million, with a potential $15 billion saved through improved property management and elimination of thousands of buildings from the federal government's holdings. The White House has launched an online database that gives details on nearly half of the buildings, warehouses, and other structures that have been identified as underused at www.whitehouse.gov/issues/fiscal/excess-property-map.

Sen. Tom Carper (D-Del.), chairman of the Senate Homeland Security Subcommittee on Federal Financial Management, was also supportive of the administration's plan and the House legislation. Carper said he would introduce legislation in the Senate and schedule a hearing on the topic in June as part of a comprehensive plan to save money by better management of federal property.

Senate EPW Committee Releases Transportation Principles
COMPLETE STREETS BILL ALSO INTRODUCED IN SENATE

The Senate Environment and Public Works Committee released a list of principles to be included in the next transportation reauthorization bill. In a joint statement on May 25, Sens. Barbara Boxer (D-Cal.), James Inhofe (R-Okla.), Max Baucus (D-Mont.), and David Vitter (R-La.) announced their intentions for a $339.2 billion bill, referred to as Moving Ahead for Progress in the 21st Century (MAP-21). The legislation accounts for inflation but does not otherwise provide a funding increase over current levels. It assumes continued support from the general fund to keep the Highway Trust Fund solvent and the elimination of earmarks. Senators announced that they hope to continue looking at various financing solutions for ensuring the trust fund's long-term solvency and sustainability.

Similar to details announced previously by House Transportation and Infrastructure Chairman John Mica (R-Fla.), the Senate bill will consolidate programs, increase emphasis on the Transportation Infrastructure Finance and Innovation Act (TIFIA) loan program, and make efforts to expedite project delivery. The legislation is expected to be released later this month in time to hold hearings and a markup before the July 4 recess. Release of a bill in the House is tentatively planned for the week of June 13.

Other transportation efforts in the Senate included the May 24 introduction of the Safe and Complete Streets Act of 2011. Led by Tom Harkin (D-Iowa), S 1056 was supported by a dozen cosponsors. This bill is similar to the one introduced in the House in April by Reps. Doris Matsui (R-Cal.) and Steve LaTourette (R-Ohio). The legislation, which has been endorsed by APA, would direct states and MPOs to require that all transportation projects comply with Complete Streets principles.