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“INTRODUCTION OF THE HURRICANE DISASTER MORTGAGE MORATORIUM ACT OF 2005” mentioning the U.S. Dept of Labor was published in the Extensions of Remarks section on pages E2070 on Oct. 7, 2005.
The publication is reproduced in full below:
INTRODUCTION OF THE HURRICANE DISASTER MORTGAGE MORATORIUM ACT OF 2005
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HON. ELIJAH E. CUMMINGS
of maryland
in the house of representatives
Friday, October 7, 2005
Mr. CUMMINGS. Mr. Speaker, I rise today to introduce The Hurricane Disaster Mortgage Moratorium Act of 2005, which would provide a 6-month moratorium on mortgage payments owed by residential and commercial property owners who reside in the disaster areas of Hurricanes Katrina and Rita. This bill would provide a temporary refuge from payment for those individuals and entities who are unable to make their mortgage payment obligations.
Mr. Speaker, as we know, the devastation wreaked by Hurricanes Katrina and Rita was of colossal proportion. The ensuing fallout of lost jobs, destroyed homes and shattered lives is equally devastating.
Needless to say, the figures that have begun to be compiled in the aftermath of the storm are staggering. Analysts with the National Association of Realtors are projecting that at least 200,000 homes in the Gulf Coast region have been destroyed or will have to be demolished. The U.S. Department of Commerce has estimated that uninsured losses could easily exceed $100 billion. Sadly, up to a million Americans were displaced by the storms and many are still living in temporary shelters.
The Department of Labor job figures released today show that unemployment is up to 5.1 percent for September, up from a 4.9 percent pre-Katrina and Rita level and much higher than the 4.0 percent level we experienced during the 1990s. According to the Joint Economic Committee Democratic staff, the unemployment rate would in fact be 9.0 percent if the figure included those who are marginally attached to the labor force and those who are forced to work part-time because of the weak economy. The Houston Chronicle on October 6, 2005 reported that as a result of Hurricanes Katrina and Rita, at least 363,000 people have lost their jobs. These dismal numbers are likely to remain constant in the short-term as our nation rebuilds this region.
In fact, most of those unemployed as a result of Hurricanes Katrina and Rita are expected to be out of work at least 6-9 months and we should only anticipate the indicators to increase. As we know, just this week we heard Mayor Ray Nagin of New Orleans inform that he has to let go of 3,000 municipal employees because the City cannot afford to pay them. This unfortunate scenario will surely be repeated to some extent throughout the region as municipal and state coffers dwindle from depleted revenue bases.
Whereas the number of job losses for the month of September is surprisingly only 35,000, the Department of Labor reported that last week, it received an additional 74,000 hurricane-related unemployment claims. In fact, nearly one in every five unemployed people--1.5 million Americans have been jobless for more than 26 weeks, the maximum number of weeks for receiving regular unemployment insurance benefits and the Hurricanes will only exacerbate these passive numbers.
The CBO predicts that the Hurricanes could actually cut job growth by between 280,000 and 400,000 jobs. Although it may sound obvious, Americans who have lost everything in a hurricane, who are not working and have little prospects of working in the near future cannot afford to pay their mortgages. This bill would provide them with a reprieve from their mortgage payments. Also, as it does not mandate forgiveness of this debt, this bill reflects the shared burden that our Nation will have to shoulder temporarily during this time of rebuilding.
Mr. Speaker, behind these figures are thousands of home and business owners whose entire livelihoods have been destroyed and who now face the prospect that the properties they have worked a lifetime to purchase could be taken from them when they fall behind in their mortgages. This bill provides a temporary sanctuary from payment and stops the clock for any default or foreclosure proceedings and negative credit reporting.
Needless to say the economic effects of the Hurricanes are being felt in painful increments nationwide. However, for the Americans forced out of their homes by the Hurricanes, the economic effects are not coming in the form of a trickle, but a deluge.
The Hurricane Disaster Mortgage Moratorium Act of 2005 will ensure that during the moratorium, those Gulf Coast residents who cannot afford to pay their mortgages will not lose their homes or suffer the negative attendant consequences from non-payment. Let's not make these Americans suffer needlessly by facing the prospect of losing their homes twice. I urge my colleagues to support this effort.
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