WALZ, UDALL SPONSOR “CONGRESS MUST CO-SIGN ACT”

02/16/2007

Bill addresses need for Congressional oversight of Dept. of Transportation loans

(Washington, D.C.) - Today, Representatives Tim Walz (MN-01) and Mark Udall (CO-02) introduced legislation to expand Congressional oversight of major loans granted by the Department of Transportation. The "Congress Must Co-Sign Act," requires that the Congress pass a law specifically approving any proposed Department of Transportation loan over $1 billion.

"This is commonsense, fiscally responsible legislation. By requiring independent Congressional approval for any loan greater than $1 billion, this bill gives people a say in whether their tax dollars are placed at risk for the benefit of private companies," said Rep. Tim Walz.

"In the case of the $2.3 billion DM&E Railroad expansion, the residents of my district have made it clear that they want to see their concerns about safety, transparency and fiscal responsibility addressed before their tax dollars go on the line. Unfortunately, the current loan approval process doesn't incorporate meaningful input from the public; requiring Congressional approval will give people access to the process through their elected representatives."

Walz continued, "In 1979, when Chrysler was in the midst of a financial dilemma, Congress deliberated on the $1.2 billion loan guarantee that helped the company back onto its feet. The proposed DM&E loan is nearly twice the size of the Chrysler bailout and yet the decision-making takes place behind closed doors in a bureaucracy, not out in the open in Congress. Our bill would bring this kind of backroom decision-making to an end."

"We are introducing this bill to require Congressional approval of a form of back-door spending that could leave the taxpayers exposed to serious financial liability. It deals with proposals to have the Department of Transportation lend a billion dollars - or more - for any one purpose. It would require greater transparency regarding such loans and a separate Congressional vote to approve each such loan, even if it had received preliminary approval either on its own or as part of a larger measure. The purpose is to increase Congressional accountability and to reduce the chance the taxpayers will find themselves stuck with the bill if the lender should default on one of these loans," said Udall.

The bill requires the Secretary of Transportation to secure the approval of the Congress for any loan that "could expose taxpayers to a potential liability of $1,000,000,000 or more." The legislation also requires that the Secretary provide a description of the loan, documentation of the authority to make the loan and all terms and conditions of the loan for Congressional consideration.