Rep. Barney Frank (D-MA) introduced H.R. 1151 last week and would direct the Treasury to levy $2.5 billion in “risk-based assessments” on “hedge fund managers with $10 billion or more in assets under management on a consolidated basis” and on other “financial companies with $50 billion or more in total consolidated assets.”
The top ranking Democratic lawmaker on the House Financial Services Committee said the bill would seek the funds from large banks.
“This program provides important funding to cities that have already been hit by the foreclosure crisis and allows them to cope with the blight, expense and destabilization that come with the presence of large numbers of empty properties,” he noted.
The money would go into the Treasury’s general fund, but Frank has said he wants the money to help pay for housing relief programs Republicans are hoping to axe.
Frank announced last week on the House floor that such a bill would be forthcoming, arguing that large financial institutions can afford to pay for mortgage assistance programs.
“I don’t mean to demonize, but I think Goldman Sachs and Wells Fargo and the Bank of America and Citicorp and Morgan Stanley and the large hedge funds, I think they can pay for this,” he said March 11.
The House voted on March 16 to end the Neighborhood Stabilization Program (NSP), a program which provides funding to help communities deal with large numbers of foreclosures and abandoned properties. The NSP Termination Act (H.R. 861) has now been referred to the Senate Banking Committee.
