What Does House Leadership Shake-up Mean for NHTF?

Rep. Ed Royce Positioning for
Financial Services Committee Chair

Edward RoyceSpeaker of the House John Boehner’s (R-OH) decision to resign from Congress at the end of October sets off speculation about his replacement and who will move up in the Republican hierarchy.

The ultra-conservative wing of the House Republicans, which threatened to unseat Mr. Boehner as Speaker, will continue to influence major decisions and may indeed have more power.

At this point-in-time, the vote for a new House Speaker will occur on October 29th. The three candidates are current Majority Leader Kevin McCarthy (R-CA), Representative Daniel Webster (R-FL) and Representative Jason Chaffetz (R-UT).

In addition, another major competition will be for the next Majority Leader.

Among the names circulating is House Financial Services Committee Chair Jeb Hensarling (R-TX). If Mr. Hensarling moves up, there will need to be a new Chair for the Financial Services Committee. Representative Ed Royce (R-CA) has announced his interest in the post.

Mr. Royce authored several legislative efforts to defund the National Housing Trust Fund (NHTF).

When Federal Housing Finance Agency Director Mel Watt lifted the suspension on funding the NHTF from Fannie Mae and Freddie Mac, Mr. Royce introduced H.R. 574, the “Pay Back the Taxpayers Act of 2015,” proposing prohibiting Fannie and Freddie from using funds for the NHTF as long as they remain in conservatorship. He introduced the same bill in the previous Congress. This bill is also con=sponsored by Congressman Scott Garett.

Mr. Royce was also behind the provision in the FY15 House Appropriations bill that would have prevented HUD from spending any federal funds to implement the NHTF.

On housing finance reform, Speaker Boehner provided a backstop against further movement on Chair Hensarling’s PATH Act, which would have eliminated Fannie and Freddie, and the NHTF in the process. The bill, H.R. 2767, was voted out of committee, but never brought to the House floor. The prime sponsor of the bill is Congressman Scott Garett.

More centrist House Republicans and the housing industry opposed the bill. It remains to be seen if the new House leadership will be willing to entertain similar legislation.