Statement of Administration Policy: H.R. 939 - Veterans' Housing Amendments

(SENT 3/2/92)
(House)
(Staggers (D) WV and 39 others)

Although the Administration supports the certificate guarantee provision of H.R. 939, it strongly objects to enactment of the bill because it would:

—   Violate the pay-as-you-go requirement of the Omnibus Budget Reconciliation Act of 1990 (OBRA). It would increase direct spending without sufficient offsets.

—   Extend housing benefits from the Department of Veterans Affairs (VA) to members of the Selected Reserve. Although reservists make a significant contribution to the defense readiness of the Nation, it is inappropriate to extend this readjustment benefit to persons already in civilian life whose military service did not limit their ability to finance the purchase of a home.

—   Require that VA conduct a demonstration program using adjustable rate mortgages (ARMs). ARM default rates have historically been higher than those for fixed rate mortgages. A new ARM program would increase the cost associated with VA's home loan guarantee program.

The Administration understands that section 5 of H.R. 939 will not be in the bill considered on the House floor. This provision would exclude from taxation waivers of certain debt established against veterans. The Administration concurs with the deletion of this provision from the bill.

Scoring for the Purpose of Pay-As-You-Go

H.R. 939 would increase direct spending; therefore, it is subject to the pay-as-you-go requirement of OBRA. Insufficient offsets are provided in the bill. A budget point of order applies in the House and Senate against any bill that is not fully offset under CBO scoring. If, contrary to the Administration's recommendation, the House waives any such point of order that applies against H.R. 939, the effects of enactment of this legislation would be included in a look back pay-as-you-go sequester report at the end of the congressional session.

OMB's preliminary scoring estimates for this bill are presented below. Final scoring of this legislation may deviate from these estimates. If H.R. 939 were enacted, final OMB scoring estimates would be published within five days of enactment, as required by OBRA 1990. The cumulative effects of all enacted legislation on direct spending will be issued in monthly reports transmitted to Congress.

Estimates for Pay-As-You-Go
(in millions of dollars)