This was a vote on an amendment by Sen. Tom Coburn (R-OK) that would prohibit city and state governments from using federal grants to repay loans from the federal government for city or state projects. This amendment was offered to legislation that would provide annual funding in fiscal year 2012 for Agriculture, Transportation, and Commerce department programs.
Coburn’s office released “background” information that explained his rationale for the amendment: “In a lending scheme so strange it could only have been devised by the government, the Department of Housing and Urban Development (HUD) is loaning taxpayer dollars and then forcing the lenders—the taxpayers—to repay the loans. As a result, taxpayers get stuck footing the bill repaying the loans of delinquent developers and bailing out failed or poorly planned local projects. This amendment protects taxpayers by prohibiting the use of federal grants to repay federal loans.”
Debate on his amendment was extremely brief. Coburn said: “This is an amendment that addresses something that is going on that I think we should not allow. We have a lot of great programs that help a lot of cities and states out by creating loans that allow the cities and states to do something. What is happening is, when the project we gave the loan for fails, they turn around and take federal grants to repay the loan. All this amendment does is to prohibit us from allowing grants to be used to repay federal loans on local or city or state projects.”
No senators spoke in opposition to this amendment.
The Senate agreed to Coburn’s amendment by a vote of 73-26. All 47 Republicans and 26 Democrats voted “yea.” 26 Democrats—including a majority of progressives—voted “nay.” As a result, the Senate agreed to an amendment that would prohibit city and state governments from using federal grants to repay loans from the federal government for city or state projects. In order for this amendment to become law, however, it would have to pass the House of Representatives and be signed into law by the president. When this vote occurred, the House had not yet voted on this amendment.