Rep. Kelly’s Bipartisan GAIIN Act Gains Momentum

Nov 2, 2018 Issues: Economy and Jobs

Innovative infrastructure bill endorsed by House Majority Leader

Attracts co-sponsors from conservative and progressive caucuses

WASHINGTON — Bipartisan legislation introduced by U.S. Representative Mike Kelly (R-PA) known as the Generating American Income and Infrastructure Now (GAIIN) Act (H.R. 6104) has gained impressive traction over the last few months in the U.S. Congress.

House Majority Leader Kevin McCarthy (R-CA) endorses the GAIIN Act

Leader McCarthy: “Rebuilding America’s infrastructure is an intense national priority that persistently lacks a sufficient response. To help solve these stubborn challenges we should debate big, bold ideas. We are in a time of disruption to the old ways of Washington that centered policy debates on old ideas with a new coat of paint. The great promise of the Trump Administration is that we can break through stalemate and stale ideas to build an economy that works for all Americans, especially Americans facing hardship. The GAIIN Act is an example of an alternative solution that deserves consideration to achieve our shared goal for a better American infrastructure in our communities most in need.”

Uncommon lawmakers find common ground

In addition to Rep. Kelly, co-sponsors of the GAIIN Act now include…

Members of the Congressional Black Caucus and Progressive Caucus: Rep. Lacy Clay (D-MO), Rep. Sheila Jackson Lee (D-TX), and Rep. Frederica Wilson (D-FL)

Members of the House Freedom Caucus and Financial Services Committee: Rep. Ted Budd (R-NC), Rep. Warren Davidson (R-OH), Rep. Alex Mooney (R-WV)

Reps. Kelly and Clay co-author bipartisan op-ed for RealClearPolitics.com

Excerpts from “Bipartisan Bill Would Boost Infrastructure, Trim Debt”:

As members of the Democratic and Republican parties, we disagree on most issues, but we share the common belief that more can and must be done to help lift up the most impoverished communities in our country. While many of the problems in these areas cannot be cured by government alone, Washington policymakers can take certain actions to begin directing resources to the places that need them most.

For this purpose, we (along with Rep. Ted Budd of North Carolina) introduced a bipartisan bill (HR 6104) in June known as the Generating American Income and Infrastructure Now (GAIIN) Act to help fund critical infrastructure projects in the poorest areas of the nation. It would do so without any new taxes or spending and would simultaneously help pay down our record-high national debt.

Reviving America’s poorest cities and towns is a moral, fiscal, and economic imperative. It is rare than one piece of legislation can meet this objective on its own, let alone bring together conservative Republicans and progressive Democrats from minority communities. Even rarer is a bill that attracts the co-sponsorship of lawmakers in the House Freedom Caucus, the Black Congressional Caucus, and the Progressive Caucus just a few months before an election. But the GAIIN Act is that kind of bill.

Reps. Kelly and Clay appear on A&E’s “Matter of Fact with Soledad O’Brien”

O’Brien: “Collapsing roads and bridges, unsafe drinking water, and run-down schools are all problems that both parties say we need to fix, but like many problems facing Republicans and Democrats, they usually don’t agree on the solution. Now, conservatives and liberals have reached common ground on an infrastructure bill that would invest in America’s poorest communities. Democratic Congressman Lacy Clay of Missouri and Republican Congressman Mike Kelly of Pennsylvania, nice to have you both. Very rarely does a liberal member of Congress and a conservative member of Congress sit down and come up with bills together.”

WATCH THE FULL INTERVIEW HERE

BACKGROUND

The GAIIN Act (H.R. 6104) was introduced in the U.S. House of Representatives on June 14, 2018, by Reps. Mike Kelly (R-PA), Lacy Clay (D-MO), and Ted Budd (R-NC).

Federal agencies currently hold more than $2 trillion in debt and lease assets that, if sold, could raise a significant amount of money. The sale of these fixed-rated debt assets at this time would maximize asset value, considering that interest rates are on the rise and the Federal Reserve’s quantitative tightening program is on the horizon. As interest rates rise, the value of the agency assets will decline—perhaps substantially. Importantly, the sales would not alter the terms of the loans. The consumer protection obligations associated with eligible Department of Agriculture loans and guarantees would convey with the sale, thereby minimizing impact on borrowers.

Additionally, borrowers would be given 30‐days’ notice of any sale and offered the opportunity to refinance at the same price of a potential sale. The GAIIN Act’s authors believe that there are sufficient private sector programs available for borrowers to refinance their loans at the discounted value. Any loans that remain outstanding would be eligible for sale to investors, which, under the GAIIN Act, would occur without recourse and create no liability for the U.S. government. Servicing would be provided by private entities with the demonstrated capacity to effectively service such loans.

During the Reagan administration, the Omnibus Budget Reconciliation Act of 1986 (P.L. 99‐509) required specified federal agencies to sell certain outstanding loans. For example, the program required the Secretary of Agriculture to sell debt assets held in the Farmers Home Administration Rural Development Insurance Fund over a three‐year period. The proposal outlined within the GAIIN Act is modeled on the earlier program and incorporates its various provisions.
 

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