WASHINGTON Feb 12 The U.S. Senate Banking
Committee is expected to move forward within "the next few
weeks" with bipartisan plans for overhauling the U.S. mortgage
finance system, Housing and Urban Development Secretary Shaun
Donovan said on Wednesday.
"We'll have a bipartisan product relatively soon," Donovan
said at a forum sponsored by Politico in Washington. "There is a
way to find a compromise."
President Barack Obama as well as Democrats and Republicans
in Congress want to wind down Fannie Mae and Freddie
Mac. Leaders of the Senate banking panel wanted to
roll out a housing reform bill by the end of 2013, but missed
the target and have yet to introduce legislation.
"We have a relatively short window to get something done,"
Donovan said. "There is a great deal of bipartisan groundwork."
Senate Banking Committee Chairman Tim Johnson and Senator
Mike Crapo, the panel's top Republican, are aiming to produce a
bipartisan bill that builds on legislation that 10 senators had
already co-sponsored to wind down Fannie Mae and Freddie Mac and
allows for a federal backstop for lending in a crisis.
While momentum is building, it remains unlikely Congress
will enact a law this year.
The challenge for the Senate Banking Committee is whether
Johnson will be able to coax the panel's Democrats that have
started to splinter over concerns about how much the bill
reduces the government's support for the housing market, and
fails to promote affordable housing programs.
Republicans may support the overhaul but it's unclear
whether they would back down if more emphasis is placed on
low-incoming housing initiatives in the negotiation process.
"We're making real progress, but there is more that we can
do," Donovan said. "Both sides could walk away with something."
Any bill offered in the Senate must be reconciled with a
Republican-backed measure in the House of Representatives that
greatly limits the government's housing-finance role. Midterm
elections also complicate the congressional calendar and detract
from efforts to get something done.
The U.S. government seized Fannie Mae and Freddie Mac in
2008 after they were pushed to the brink of insolvency by
investments in bad loans. The duo took $187.5 billion in
taxpayer aid but have since paid about $185.2 billion in
dividends to the government, thanks to the U.S. housing market