Senator Boxer Praises Efforts to Move Economic Stimulus Package

Urges Inclusion of Measures to Address Foreclosure Crisis, Unemployment, and Hunger Relief

January 25, 2008 -- Washington, DC – U.S. Senator Barbara Boxer (D-CA) today wrote to Senate Majority Leader Harry Reid (D-NV) and Senate Finance Committee Chair Max Baucus (D-MT) outlining key elements that she believes should be included when the Senate takes up its economic stimulus package.

Boxer praised the inclusion of a provision to raise loan limits for the Federal Housing Administration (FHA), Fannie Mae and Freddie Mac up to $729,750. But she also urged the Senate to include $10 billion in new Community Development Block Grant funding to help communities maintain vacant properties, fight vandalism and crime, and prevent a downward spiral of home values.

And while Boxer lauded the House’s decision to provide rebate checks to lower income earners, she advocated including other elements to reach people impacted by the downturn and more directly boost the economy, like extending unemployment insurance and increasing funding for Food Stamps and Medicaid.

She also urged the Senate to include $60 million in emergency funding for food banks nationwide. A decrease in federal aid to California’s food banks has meant a loss of nearly 45 million meals in 2007 at a time when many rural areas in the state have been experiencing economic hardship due to natural disasters.

Boxer also advocated seizing the opportunity presented by the stimulus package to create jobs by investing in renewable energy and infrastructure projects.

The text of the letter follows:

January 25, 2008
Dear Senators Reid and Baucus:

I am very supportive of Congress's efforts to address the economic downturn by moving quickly on a stimulus package. As the Senate moves forward, I would like to outline the following recommendations which I believe will make the economic stimulus package more effective and longer lasting for California and the country.

Rebate Checks for Seniors: I applaud the decision to include rebate checks for an additional 35 million low-income earners most in need of economic relief and most likely to spend the money quickly, but we need to do more. I hope the Committee will also consider helping low-income seniors who do not pay taxes. California is home to 3.9 million people age 65 and older, many of whom live on fixed incomes and are particularly hard hit by rising prices.

Foreclosure Crisis Relief: I strongly support raising the loan limits for the Federal Housing Administration (FHA) and Fannie Mae and Freddie Mac up to $729,750, as included in the preliminary House bill. In my own state of California, the median home price is over $530,000 and some urban areas in the state have median home prices of over $800,000, making these higher loan limits essential.

CDBG Funding: A new $10 billion Community Development Block Grant initiative is needed to help communities combat the rising tide of vacant houses caused by the foreclosure crisis. Funds should go to local governments in the most affected areas and could be used to help maintain vacant properties, fight vandalism and crime, and purchase foreclosed homes.

Unemployment Insurance: California faces a particularly high unemployment rate of 6.1 percent -- the sixth highest nationwide. Job creation has also been very slow in our state, with a mere average of 6,900 jobs a month having been created since 2001. Extending unemployment insurance, which provides highly targeted economic relief to those most in need, must be included in any stimulus legislation.

Hunger Relief: I encourage you to include a significant increase in Food Stamp benefits for current recipients. There are currently two million Californians receiving food stamps, with another two million – and growing – eligible. Increasing food stamps provides a high per-dollar benefit to the economy and helps the neediest Americans.

Furthermore, there has been a drastic decline in emergency food provided to California by the USDA. In 2002 USDA provided nearly 100 million pounds of food to our state’s food banks, but by 2007, less than 40 million pounds of food were delivered. This decrease translates to nearly 45 million meals lost in 2007 according to the California Department of Social Services at a time when many rural areas in the state are experiencing economic hardship due to natural disasters. I request $60 million in emergency funding for the USDA’s Emergency Food Assistance Program (TEFAP) in the stimulus bill to help food banks nationwide.

Medicaid Assistance: State budget deficits are growing – in California we are now facing a $14.5 billion shortfall – and increasing the share of Medicaid paid by the federal government (the Federal Medicaid Assistance Percentages or FMAP) is essential. California’s Medicaid program, MediCal, provides health and long-term care coverage to over 10 million people who are most in need of medical coverage and least able to afford it.

Job Creation Through Renewable Energy: Extending tax incentives for renewable energy production will immediately encourage the production of clean energy, and will also help create long-term and sustainable “green jobs” – already an important part of California’s economy and the future of America’s economy. Indeed, some industry estimates indicate that more than 100,000 new jobs could be created in 2008 if these production tax credits are extended early this year. Additionally, we should also extend the investment tax credit (ITC) for clean energy sources such as solar, which would immediately encourage investment in these important technologies. Finally, providing tax incentives to help weatherize America’s homes will make our nation more energy efficient and create new jobs in the vital manufacturing and construction sectors. These provisions will reduce our dependence on foreign oil and help improve our environment and combat global warming.

Job Creation Through Infrastructure Investment: There are a significant number of highway and wastewater infrastructure projects that are ready to proceed within 90 days. Since each $1 billion of infrastructure spending creates an estimated 47,500 jobs, investment in those projects will help address the current construction unemployment rate of 9.5 percent. A carefully crafted infrastructure investment package could meet the dual goals of short-term economic stimulus by putting paychecks in the hands of workers while improving longer term productivity.

I thank you for considering these requests and look forward to working with you to ensure the Senate economic stimulus package helps California and the nation.

Sincerely,

Barbara Boxer

U.S. Senator

Source: Senator Barbara Boxer