| 00:00:00 | THE RULES PASS H. |
| 00:00:03 | R. 5901 AS AMENDED. |
| 00:00:07 | THE SPEAKER PRO TEMPORE: ACCOUNT CLERK WILL REPORT THE TITLE OF THE BILL. |
| 00:00:09 | THE CLERK: A BILL TO AMEND THE INTERNAL REVENUE CODE OF 1986 TO VR INVESTMENT TRUSTS ON THE TAX OF FOREIGN INVESTMENT REAL PROPERTY INTERESTS AND FOR OTHER PURPOSES. |
| 00:00:24 | THE SPEAKER PRO TEMPORE: PURSUANT TO THE RULE, THE GENTLEMAN FROM NEW YORK, MR. |
| 00:00:28 | CROWLEY AND THE GENTLEMAN FROM TEXAS, MR. |
| 00:00:31 | BRADY EACH WILL CONTROL 20 MINUTES. |
| 00:00:34 | THE CHAIR RECOGNIZES THE GENTLEMAN FROM NEW YORK. |
| 00:00:38 | MR. CROWLEY: I YIELD MYSELF FOUR MINUTES. |
| 00:00:41 | I AM PLEASED TO INTRODUCE THIS BILL, THE REAL ESTATE JOBS AND INVESTMENT ACT. |
| 00:00:45 | THIS BILL WILL HELP ADDRESS THE GROWING PROBLEMS IN THE U. |
| 00:00:48 | S. COMMERCIAL REAL ESTATE MARKET BY ATTRACTING NEW CAPITAL TO ALLEVIATING ACCUMULATING TAXES THAT DISCOURAGE INVESTMENT IN UNITED STATES REAL ESTATE MARKETS. |
| 00:01:00 | ALMOST $170 BILLION IN COMMERCIAL REAL ESTATE IS UNDER WATER, WITH MANY OF THESE MORTGAGES NEEDING TO BE REFINANCED WITHIN THE NEXT TWO TO THREE YEARS. |
| 00:01:10 | WITHOUT A NEW INFUSION OF CAPITAL, A COLLAPSE IN THE REAL ESTATE MARKET COULD LEAD TO YET ANOTHER ECONOMIC DOWNTURN. |
| 00:01:19 | THAT IS A RISK THAT OUR COUNTRY CANNOT AFFORD RIGHT NOW. |
| 00:01:24 | UNDER CURRENT U.S. TAX LAW, FOREIGN INVESTORS DO NOT PAY CAPITAL GAINS TAXES WHEN THEY SELL STOCK IN A U. |
| 00:01:32 | S. CORPORATION SUCH AS A MICROSOFT OR GOOGLE UNLESS THAT U. |
| 00:01:36 | S. CORPORATION IS A REAL ESTATE INVESTMENT TRUST, WHICH IS LIKE A MUTE TALL FUND FOR REAL ESTATE. |
| 00:01:46 | BECAUSE FEDERAL TAX LAW IMPOSE ELSE CERTAIN PUNITIVE TAXES ON FOREIGN INVESTMENT ON U. |
| 00:01:51 | S. REAL ESTATE, FOREIGN INVESTORS ARE NOT PUTTING THEIR MONEY INTO THE U. |
| 00:01:57 | S. COMMERCIAL SECTOR. THE REAL ESTATE JOBS AND INVESTMENT ACT TAKES DIRECT AIM AT THIS PROBLEM BY DOUBLING THE AMOUNT OF FOREIGN CAPITAL THAT CAN BE INVESTED IN A PUBLICLY TRADED REAL ESTATE INVESTMENT TRUST. |
| 00:02:12 | THE BILL IS FULLY PAY-GO COMPLIANT. |
| 00:02:16 | SO IT WON'T INCREASE OUR DEBT OR DEFICIT BY EVEN A SINGLE PENNY. |
| 00:02:22 | I WANT MY COLLEAGUES TO KNOW THAT THIS BILL WILL NOT DISADVANTAGE U. |
| 00:02:29 | S. TAXPAYERS OVER FOREIGN TAXPAYERS. |
| 00:02:31 | THAT'S BECAUSE FOREIGN INVESTMENT IN U. |
| 00:02:32 | S. REAL PROPERTY WILL CONTINUE TO BE TAXED IN THE SAME MANNER AS DOMESTIC INVESTMENTS. |
| 00:02:39 | UNDER CURRENT TAX LAW, ONLY FOREIGN INVESTORS IN U. |
| 00:02:43 | S. REAL ESTATE ARE PENALIZED WITH A SPECIAL TAX. |
| 00:02:48 | THIS WILL RELIEVE PART OF THE TAX ON REAL ESTATE, A TAX THAT DOES NOT EXIST WHEN A FOREIGNER EXISTS IN AN ASSET CLASS SUCH AS STOCKS. |
| 00:02:58 | THIS BILL WILL NOT OPEN THE DOOR TO DUBAI OR CONTROL TO U. |
| 00:03:04 | S. REAL ESTATE BY COUNTRIES WHO DO NOT HAVE OUR BEST INTERESTS AT HEART. |
| 00:03:10 | THIS BILL ONLY INCREASES FROM 5% TO 10% THE AMOUNT AN INVESTOR CAN PLACE IN A TRUST. |
| 00:03:18 | THIS IS NOT OWNERSHIP CONTROL BY ANY MEANS. |
| 00:03:22 | ANY FOREIGN INVESTOR OWNING MORE THAN 10% IN THESE INVESTMENT VEHICLES WILL BE FORCED TO PAY THE PUNITIVE TAX AND WILL HAVE TO REGISTER WITH THE SECURITIES AND EXCHANGE COMMISSION. |
| 00:03:34 | THIS BILL AIMS TO CORRECT THE CURRENT LAW -- TAX LAW, WHICH DISCOURGES FOREIGN INVESTMENT IN U. |
| 00:03:41 | S. REAL STATE AND BRING IN NEW INVESTMENT. |
| 00:03:45 | THE BILL HAS BEEN ENDORSED BY THE REAL ESTATE ROUND TABLE, ORGANIZATION FOR IRNL INVESTMENT, THE NATIONAL ASSOCIATION FOR REAL ESTATE INVESTMENT TRUSTS AND SHOPPING CENTERS AND BUILDING OWNERS AND MANAGERS ASSOCIATION, THE NATIONAL ASSOCIATION OF REAL ESTATE INVESTMENT MANAGERS, THE ASSOCIATION OF FOREIGN INVESTORS IN REAL ESTATE, THE MULTIHOUSING COUNCIL AND THE NATIONAL APARTMENT ASSOCIATION. |
| 00:04:14 | THIS IS A COMMONSENSE REFORM WHEN NEW INVESTMENTS ARE NEEDED IN OUR U. |
| 00:04:18 | S. ECONOMY. |
| 00:04:19 | THE MORE WE CAN DO TO ADDRESS THE PROBLEMS IN COMMERCIAL REAL ESTATE BEFORE THEY BOIL OVER, THE BETTER, AND WITH THAT, I RESERVE THE BALANCE OF MY TIME. |
| 00:04:28 | THE SPEAKER PRO TEMPORE: THE GENTLEMAN RESERVES THE BALANCE OF HIS TIME. |
| 00:04:32 | THE CHAIR WILL CLARIFY THAT THE PENDING MOTION IS TO SUSPEND THE RULES AND PASS THE BILL AS INTRODUCED. |
| 00:04:36 | THE GENTLEMAN FROM TEXAS. |
| 00:04:38 | MR. BRADY: I YIELD MYSELF SUCH TIME AS I MAY CONSUME. |
| 00:04:41 | THE SPEAKER PRO TEMPORE: THE GENTLEMAN IS RECOGNIZED. |
| 00:04:43 | MR. |
| 00:04:44 | BRADY: I ASK UNANIMOUS CONSENT TO REVISE AND EXTEND MY REMARKS. |
| 00:04:54 | MADAM SPEAKER, WE ARE AWARE OF THE TUR BUT LENS IN THE CREDIT MARKETS AND THIS MADE IT DIFFICULT TO OBJECT TANCHE FINANCING FOR NEW PROJECTS OR REFINANCE EXISTING ONES. |
| 00:05:02 | TRANSACTIONS VOLUMES HAVE FALLEN AND RENTS HAVE FALLEN. |
| 00:05:04 | OUR REAL ESTATE MARKETS ARE DESPERATE FOR INFUSIONS. |
| 00:05:08 | ONE SIGNIFICANT SOURCE OF CAPITAL INVESTMENTS FOR THESE PROJECTS IS FOREIGN INVESTORS. |
| 00:05:13 | IT'S IMPORTANT FOR CONGRESS TO REVIEW THE RESTRICTIONS THAT THE U. |
| 00:05:17 | S. TAX CODE IMPOSES ON FOREIGN INVESTMENTS TO ENSURE THAT THESE RESTRICTIONS DO NOT UNNECESSARILY DISCOURAGE INVESTMENTS ESPECIALLY DURING TIMES LIKE THIS. |
| 00:05:29 | EARLIER THIS YEAR, THE GENTLEMAN FROM OHIO, MR. |
| 00:05:32 | TIBERI WORKED WITH THE GENTLEMAN FROM NEW YORK, MR. |
| 00:05:37 | CROWLEY ON LEGISLATION THAT WOULD MODIFY SOME OF THE TAX RULES IN THIS AREA. |
| 00:05:43 | COLLECTIVELY KNOWN AS THE FOREIGN INVESTMENT AND REAL PROPERTY TAX ACT. |
| 00:05:48 | TODAY'S LEGISLATION BASED ON THEIR EARLIER BILL WOULD REMOVE AN UNNECESSARY BARRIER TO FOREIGN INVESTMENT IN THE U. |
| 00:05:55 | S. REAL ESTATE MARKET AND PROVIDE LIQUIDITY THAT IS NEEDED. |
| 00:06:04 | PORTFOLIO INVESTORS WHO OWN 5% ARE EXEMPTED FROM THE STRINGENT TAX REGIME. |
| 00:06:11 | THIS BILL WOULD RAISE THAT 5% THRESHOLD TO 10% FOR INVESTMENTS IN PUBLICLY TRADED REAL ESTATE INVESTMENT TRUSTS. |
| 00:06:22 | THIS MODIFICATION WOULD ENCOURAGE INVESTMENT OF ADDITIONAL CAPITAL INTO OUR REAL ESTATE MARKETS AT A TIME WHEN THE CREDIT MARKETS NEED IT MOSS MEESE. |
| 00:06:31 | LET ME SAY ABOUT THE OFFSETS THE MAJORITY HAS CHOSEN, TIGHT YNG OF THE RULES FOR FEDERAL CONTRACTORS AS IDENTIFIED OF OWING TAXES. |
| 00:06:41 | THIS IS BASED ON A SIMILAR PROPOSAL THAT WAS INCLUDED IN THE FISCAL YEAR 2011 BUDGET REQUEST AND SUBSEQUENTLY INCLUDED IN H. |
| 00:06:50 | R. 4849, THE SMALL BUSINESS AND INFRASTRUCTURE SPENDING BILL INTRODUCED BY CHAIRMAN LEVIN, WHICH PASSED THE HOUSE ON A MOSTLY PARTY-LINE VOTE ON MARCH 24 OF THIS YEAR. |
| 00:07:01 | THE BILL WE ARE CONSIDERING TODAY WAS INTRODUCED JUST LAST NIGHT. |
| 00:07:06 | AND FOR THE VERY FIRST TIME, THE REAL ESTATE PROPOSAL THAT MR. |
| 00:07:10 | TIBERI HAD BEEN WORKING ON HAS BEEN PAIRED UP WITH THIS PARTICULAR OFFSET. |
| 00:07:18 | SINCE THE BILL WAS INTRODUCED LAST NIGHT, WE HAVE CONDUCTED CONSIDERABLE DUE DILIGENCE ON THIS PROVISION, INCLUDING DISCUSSIONS WITH NUMEROUS ORGANIZATIONS AFFECTING TAXPAYERS. |
| 00:07:31 | NONE OF THESE ASSOCIATIONS HAVE OFFERED SUPPORT FOR THIS OFFSET, WE ARE AT THIS TIME UNAWARE OF ANY GROUP THAT INTENDS TO ACTUALLY OPPOSE THIS BILL BECAUSE OF THIS PROVISION. |
| 00:07:43 | SHOULD H.R. 5901 PASS THE HOUSE, I WILL CONTINUE TO DISCUSS THIS NEW PROVISION WITH POTENTIALLY AFFECTED GROUPS TO ENSURE IT DOES NOT PLACE ANY UNDUE BURDEN ON TAXPAYERS. |
| 00:07:54 | THAT BEING SAID, THE CRISIS IN THE CREDIT MARKET IS A SERIOUS CONCERN WE ALL SHARE. |
| 00:07:59 | AND THIS BILL WILL HELP OUR STRUGGLING REAL ESTATE MARKETS GET THE CAPITAL THEY NEED. |
| 00:08:05 | I YIELD BACK THE BALANCE OF MY TIME. |
| 00:08:08 | THE SPEAKER PRO TEMPORE: THE GENTLEMAN YIELDS BACK THE BALANCE OF HIS TIME. |
| 00:08:12 | THE GENTLEMAN FROM NEW YORK. |
| 00:08:13 | MR. CROWLEY: IF I COULD YIELD MYSELF JUST 30 SECONDS. |
| 00:08:16 | I THANK THE GENTLEMAN FOR HIS REMARKS AND ALSO RECOGNIZE -- WE MAY HAVE TO COME BACK AND DO ADDITIONAL WORK TO HELP THIS INDUSTRY BECAUSE IT'S A NATIONAL CRISIS AND NOT JUST IN NEW YORK, BOSTON, L. |
| 00:08:31 | A. OR CHICAGO. |
| 00:08:32 | IT'S ALL OVER THE COUNTRY AND IT IS A SMALL PART TO HELP INFUSE FOREIGN INVESTMENT AND CASH INTO THE SYSTEM TO PUT PEOPLE BACK TO WORK BECAUSE CONSTRUCTION WORKERS BACK ON THE JOB AND TO GET PEOPLE IN BUILDING OFFICE SPACE AND REALLY BRINGING IN MORE CAPITAL TO LIFT UP THIS INDUSTRY. |
| 00:08:51 | I THANK THE GENTLEMAN FOR HIS COMMENTS. |
| 00:08:53 | MR. |
| 00:08:54 | SPEAKER, WE HAVE NO ADDITIONAL SPEAKERS ON OUR SIDE, I BELIEVE. |
| 00:08:59 | AND IF THE GENTLEMAN IS WILLING TO YIELD BACK, WE'LL YIELD BACK. |
| 00:09:02 | THE SPEAKER PRO TEMPORE: THE GENTLEMAN YIELDS BACK THE BALANCE OF HIS TIME. |
| 00:09:05 | THE GENTLEMAN FROM NEW YORK. |
| 00:09:07 | I ASK UNANIMOUS CONSENT THAT ALL MEMBERS HAVE FIVE LEGISLATIVE DAYS TO REVISE AND EXTEND THEIR REMARKS AND INCLUDE EXTRANEOUS MATERIAL ON THE BILL AND WITH THAT, I YIELD BACK. |
| 00:09:20 | THE SPEAKER PRO TEMPORE: THE GENTLEMAN |
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