Terminate the Neighborhood Stabilization Program
Approximate $1 billion in savings
Created in 2008, this program provides funding to state and local government to buy and rehabilitate foreclosed homes. Congress has appropriated $7 billion for the program, including $2 billion in the Obama Administration’s stimulus bill. This program encourages government purchase of private homes and some critics have argued that it does not benefit at-risk homeowners facing foreclosure, and may instead create perverse incentives for banks and other lenders to foreclose on troubled borrowers – arguably worsening the housing crisis. This proposal would terminate the last installment of funding which was included in the financial regulation bill in the last Congress, savings taxpayers up to $1 billion.
Terminate the HAMP Program
The Obama Administration’s signature anti-foreclosure effort, the Home Affordable Modification Program (HAMP), has failed to help a sufficient number of distressed homeowners to justify the program’s cost. According to the Administration, HAMP was supposed to help 4 million homeowners. Instead, only 521,630 loans have been permanently modified under this program and the re-default rate is high. Far from helping at-risk homeowners, HAMP has actually made many worse off, according to the non-partisan Inspector General’s report. The Inspector General also concluded that the program “"continues to fall dramatically short of any meaningful standard of success."
To date, the Administration has spent approximately $840 million of the $29 billion earmarked for HAMP from the Troubled Asset Relief Program (TARP). This proposal would prohibit the government from incurring any additional obligations under this program, thus generating significant savings for taxpayers.
Terminate Exchanges with Historic Whaling and Trading Partners Program
Savings of $87.5 million over ten years
The Exchanges with Historic Whaling and Trading Partners program provides non-competitive grants to support culturally-based educational activities "to assist Alaska Natives, native Hawaiians, and children and families living in Massachusetts linked by history and tradition to Alaska and Hawaii, and members of any federally recognized Indian tribe in Mississippi." The President has proposed terminating this program in part because it is non-competitive in nature, there is no reliable performance data by which to measure the outcomes of the program, and it has "narrow goals [that] are more appropriately served with State, local, and private funding."