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 In This Issue Realtor Insider DC News and Events Report Fed Prevents Conflict between FHA and TILA Business Report Senate Finance Committee Complete Consideration of Amendments; Vote Expected Next Tuesday House Energy & Commerce Committee Approves Data Security Legislation Environment Report EPA Proposes Limiting CO2 Reduction Regs to Large Sources Energy Bill Introduced in the Senate Federal Tax Report IRS Publicizes Tax Credit on YouTube Housing Report DoD Homeowners Assistance Program for Active Military Released Realtor Insider DC News and Events Report  Fed Prevents Conflict between FHA and TILA On September 29, 2009, the Federal Reserve Board (the Fed) wrote to HUD Secretary Shaun Donovan to prevent a potential conflict between (i) the practice of requiring FHA borrowers to pay interest for the remainder of the month in which they pay-off their mortgage, and (ii) new restrictions in the Truth in Lending Act regulation (Reg Z) that took effect October 1, 2009, for new loan applications. The new TILA rules restrict prepayment penalties for all higher priced mortgage loans (loans with interest at least 1.5 percentage points above the prime rate published by the Fed based on the Freddie Mac weekly interest rate survey). The Fed advised HUD that the FHA practice was not a prepayment penalty for purposes of the TILA regulations. The Fed action was triggered by NAR President Charles McMillan's letter of September 25, 2009, urging Fed Chairman Ben Bernanke to take action to avoid this obviously unintended consequence. If this conflict had not been resolved, many lenders would have refused to make higher-priced FHA loans to avoid the risk of a TILA violation, potentially denying credit to an estimated 20 percent of FHA single family borrowers. Fed Letter to HUD Secretary Donovan (September 29, 2009) NAR Letter to Fed Chairman Bernanke (September 25, 2009) Jeff Lischer 202-383-1117, Jerome Nagy 202-383-1233, Megan Booth 202-383-1222 back to top Business Report Senate Finance Committee Complete Consideration of Amendments; Vote Expected Next Tuesday On Friday, October 2, 2009, the Senate Finance Committee wrapped up a two week long mark-up of the health reform measure introduced in September by Committee Chairman Max Baucus (D-MT) in September. When recessing at 2am, the Chairman reiterated his promise to wait before voting on the bill until the Congressional Budget Office (CBO) had determined a cost estimate for the amended bill and meets the Chairman's requirement that the bill be budget neutral . With the CBO expected to work through the weekend, a committee meeting has been scheduled at 10 am on Tuesday, October 5th. If approved at that time, the difficult task of merging the Finance language with another bill approved in July by the Senate Health, Education, Labor and Pension Committee will begin. A Senate floor vote has not been scheduled but could take place in late October. Amendments considered and approved during the Finance markup covered a wide array of issues. Perhaps the greatest discussion was given to efforts to (1) make health insurance more affordable for Americans who would be required to obtain health insurance and (2) reduce and phase-in the bill's penalty for those who fail to obtain coverage. While some of the amendments considered would have capped tax deductions, including the mortgage deduction, to pay for proposed reforms, the Chairman held fast to his objection to such a "pay-for". The bill as amended includes no such cap. Given the very fluid nature of the debate and the need to merge multiple bills into one bill before any serious discussions of a final bill can begin, NAR has not taken a position on any of the health reform bills at this time. NAR has weighed in with the various committees and offices to make sure that the health insurance challenges facing the REALTOR® community are fully understood. NAR staff is currently working to compile an overview of the changes made and will update NAR's Frequently Asked Questions document summarizing the terms of the House and Senate reform bills that have already been approved by other committees in the House and Senate. Visit www.realtor.org/healthreform Marcia Salkin 202-383-1092, Ken Wingert 202-383-1196, Scott Rinn 202-383-7508 back to top House Energy & Commerce Committee Approves Data Security Legislation On September 30, the House Energy & Commerce Committee approved H.R. 2221 the "Data Acccountability and Trust Act." This is the first committe to consider the legislation, many additional steps are necessary before the bill becomes law. This bill requires entities engaged in interstate commerce that own or possess data containing "personal information" [defined as first and last name, address or phone number in combination with one or more of the following: social security number; driver's license number, passport number, military identification number or other similar government document; or financial account number, credit or debit card number, and any required security code or password] to:
NAR continues to work with congressional staff to ensure that any final bill does not adversely impact the real estate industry. Melanie Wyne 202-383-1234, Scott Rinn 202-383-7508, Ken Wingert 202-383-1196 back to top Environment Report EPA Proposes Limiting CO2 Reduction Regs to Large Sources U.S. EPA proposed a rule this week that exempts smaller sources of greenhouse gas emissions from rigid permitting requirements under the Clean Air Act. The agency's draft rule would require facilities that release more than 25,000 tons of greenhouse gases a year to account for their emissions when obtaining clean air permits. The draft proposes to "tailor" permitting programs to limit the number of facilities that would be required to obtain New Source Review and Title V operating permits under the programs. EPA said the threshold would cover power plants, refineries and other large industrial plants, exempting small farms, schools, and apartment and office buildings. The Clean Air Act's current thresholds for regulating harmful pollutants like lead, sulfur dioxide and nitrogen dioxide are 100 or 250 tons per year. But while those thresholds are appropriate for those pollutants, EPA says, they are not feasible for greenhouse gases, which are emitted in much larger quantities. Without the tailoring rule, the lower thresholds would automatically kick in with the adoption of any EPA rules to regulate greenhouse gases. Under this tailoring rule, about 14,000 large industrial sources would need to obtain operating permits for greenhouse gases, EPA estimated, and about 3,000 of those sources would be newly subject to Clean Air Act operating permit requirements. Without a tailoring rule, millions of other sources would be required to obtain a permit. NAR is reviewing this proposed rule and will develop cooments to EPA. Russell Riggs 202-383-1259, Austin Perez 202-383-1046, Helen Devlin 202-383-7559 back to top Energy Bill Introduced in the Senate Sens. John Kerry (D-Mass.) and Barbara Boxer (D-Calif.) have introduced the "Clean Energy Jobs and American Power Act," aimed at curbing pollution that causes climate change and reducing the nation's dependence on foreign sources of energy. The legislation, while starting with a mandate by 2020 to curb the nation's greenhouse gas emissions by 20 percent from 2005 levels, omits many details, leaving negotiations with Democrats and Republican moderates to fill in the blanks. But the measure offers specifics on several critical issues, ranging from incentives for natural gas and nuclear power to how Congress can promote tree planting and sustainable farming practices as alternative compliance options for industry. NAR is currently reviewing the legislation for provisions that would specifically address real estate, such as building energy labeling requirements, or other time-of-sale mandates. Austin Perez 202-383-1046, Russell Riggs 202-383-1259, Helen Devlin 202-383-7559 back to top Federal Tax Report IRS Publicizes Tax Credit on YouTube Increasing media coverage has drawn attention to the reality that the $8000 first-time homebuyer tax credit will expire November 30. Not to be outdone, the IRS has promoted the tax credit on YouTube. The posting reminds taxpayers that the credit is a great opportunity for them. Visit the link listed below to watch the video. The visibility of the credit has also been enhanced by increased media and congressional questions as to whether an extension of the credit will be possible. The primary obstacles are not related to the questions about the credit itself, but rather its revenue effect (an extension is very "costly" in revenue terms). As Congress almost never moves a single tax item through the legislative process, there are also numerous procedural hoops to go through before an extension can be called up, debated and passed. Watch the IRS video on YouTube In Depth: 2009 First-Time Home Buyer Tax Credit Linda Goold 202-383-1083, Megan Booth 202-383-1222, Jerome Nagy 202-383-1233 back to top Housing Report DoD Homeowners Assistance Program for Active Military Released Following a lengthy delay, the Department of Defense and Army Corps of Engineers last week published the final rules for the Homeowners Assistance Program, as it applies to Members of the Armed Forces permanently reassigned during the mortgage crisis. The American Recovery and Reinvestment Act (ARRA), passed in February, provided new relief for active duty military personnel who have been permanently relocated, and face or have faced a loss on the sale of their home. The program applies to those who purchased their property before July 1, 2006, and their reassignment was ordered at least 50 miles away, between 1 February 2006 and 30 September 2012. The property has to have served as the primary residence, and the recipient must not have received HAP aid previously. For full information and an application, visit the DoD HAP website. For full information and an application, visit the DoD HAP website. Megan Booth 202-383-1222 back to top Go to archived weekly reports >> Last Updated: 10/02/2009 Bira de Aquino |
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