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Builders Prepare to Work With New Democrat-Led Congress
As the 109th Congress reconvenes this week in a post-election, lame-duck session to complete unfinished business on several spending bills to fund government programs in fiscal year 2007, lawmakers are already looking ahead to the start of the 110th Congress in January, when Democrats will take the reins in both the House and Senate for the first time since 1994.
Needing to capture a minimum of 218 House seats to gain control of the chamber, Democrats on Nov. 7 won at least 229 seats, a net gain of 29, with 10 races remaining to be decided as this issue of Nation’s Building News went to press. Republicans currently hold 196 seats.
By a narrow 51-49 margin, Senate Democrats returned to power by picking up six Republican-held seats in Missouri, Montana, Ohio, Pennsylvania, Rhode Island and Virginia. The official tally is 49 Democrats and 49 Republicans, with Independents Joe Lieberman (Conn.) and Bernie Sanders (Vt.) aligning themselves with the Democratic caucus.
Democrats also posted gains in the 36 gubernatorial elections, picking up six statehouse seats for a 28-22 majority.
The 109th Congress is expected to resume work on Nov. 14 and it is unclear how long the outgoing Republican leadership will continue the lame duck session now that they have to turn over control of both chambers in January. With only two of the 12 fiscal 2007 appropriations bills completed, lawmakers may decide to craft an omnibus measure if they don’t have enough time to complete work on the outstanding individual spending bills.
While highly unlikely, it is also possible that a continuing resolution will be approved to fund the government until early next year when Congress returns — thus enabling the new Democratic leadership to finalize fiscal 2007 funding.
Additionally, with the resignation of Defense Secretary Donald Rumsfeld, Senate Republicans are likely to remain in Washington long enough to confirm his potential successor, former CIA Director Robert Gates.
The First 100 Hours
When the 110th Congress convenes in January, Rep. Nancy Pelosi (D-Calif.), the front-runner for the House Speakership, has stated that she intends to rush a packed agenda through during the first 100 hours. House Democrats will seek to implement all the 9/11 commission recommendations on national security, raise the federal minimum wage to $7.25, eliminate corporate subsidies for oil companies, allow the government to negotiate Medicare drug prices, impose new restrictions on lobbyists, cut interest rates on college loans and support embryonic stem-cell research.
Presumptive Senate Majority Leader Harry Reid (D-Nev.) has stated that he will try to take up issues outlined by Pelosi as quickly as possible. However, he also noted that the Senate must move slower in pursuing these measures because of the 60-vote threshold that any legislation in the Senate must overcome in order to avoid a filibuster.
Separately, Senator Reid has said he wants to convene a bipartisan summit on Iraq, continue Republican efforts to increase transparency in the Appropriations process and open House-Senate conference committee meetings to the public.
In the aftermath of the elections, President Bush and Democratic leaders expressed a desire for bipartisan cooperation. And with the Democrats holding a razor-thin Senate majority and a modest advantage in the House, building bipartisan support will continue to be essential as NAHB works to achieve its legislative goals in the coming year.
BUILD-PAC, NAHB’s political action committee, contributed to 30 Senate races, winning 20 of them for a 67% success rate. In the House of Representatives, BUILD-PAC-supported candidates won 321 of 348 races for a winning percentage of 92%. BUILD-PAC is also involved in 12 races that are still too close to call. Overall, BUILD-PAC won 341 of 378 decisive races, for a 90% success rate.
In January, Democrats will assume the helm of all congressional committees, including several that deal with key housing matters. A brief synopsis of these panels, their areas of jurisdiction and their projected leaders are as follows:
Appropriations Committees
The House and Senate Appropriations Committees are important because they make decisions that involve funding for NAHB’s pro-housing agenda and appropriations for the NAHB Research Center. These powerful members control the federal government’s purse strings.
In the House, Rep. David Obey (D-Wis.) will take the helm as chairman of the full Appropriations Committee, with Rep. Jerry Lewis (R-Calif.) moving to ranking member. Rep. John Olver (D-Mass.) will lead the Transportation, Treasury, Housing and Urban Development Subcommittee (T-THUD) and, while the chairman’s gavel for the Labor/HHS/Education Appropriations Subcommittee technically passes to Rep. David Obey (D-Wis.), he is not expected to assume this role. Instead, it is expected that either Rep. Nita Lowey (D-N.Y.), or Rep. Rosa DeLauro (D-Conn.) will vie for the chair.
Sen. Robert Byrd (D-W.Va)., fresh from another Senate re-election victory, will assume the chairmanship of the full Senate Appropriations Committee, with Sen. Thad Cochran (R-Miss.) moving to ranking member. It is widely expected that Sen. Patty Murray (D-Wash.) will assume the gavel on the T-THUD Subcommittee, and that Sen. Christopher “Kit” Bond (R-Mo.) will become its ranking member. Sen. Tom Harkin (D-Iowa) is expected at this point to head the Labor/HHS/Education Appropriations Subcommittee, with Sen. Arlen Specter (R-Pa.) moving to ranking member.
With Democrat control of the House and Senate Appropriations Committees, it is anticipated there will be a renewed commitment on domestic spending, and several NAHB priority programs may receive increased funding, including housing programs such as Community Development Block Grants, Section 8 and HOME. Additionally, programs under the jurisdiction of the Department of Labor, such as Job Corps, are likely to see increases. Democrats can also be expected to look at increases in Occupational Safety and Health Administration (OSHA) regulatory and enforcement line-items.
House Education and the Workforce Committee/Senate Health, Education, Labor and Pensions Committee
The House Education and the Workforce Committee and the Senate Health, Education, Labor and Pensions Committee have jurisdiction over measures governing labor and education, including, but not limited to, workforce incentive programs, vocational rehabilitation, wages and hours of labor, and labor standards and statistics.
Organized labor has traditionally had a significant influence over the committee’s Democrats, while the Republicans have traditionally been opponents of organized labor. Consequently, votes in this committee are usually along party lines.
Rep. George Miller (D-Calif.) will take over the committee as Democrats re-focus their priorities. One of the first topics likely to be considered is an increase in the federal minimum wage, followed by several education-related bills: working to reauthorize the Higher Education Act, looking at the status of the Federal Direct Student Loan program, expanding Pell grants and working with the House Ways & Means Committee to weigh the benefits of allowing taxpayers to deduct the cost of college tuition.
The committee also is expected to hold oversight hearings on the status and quality of OSHA’s workplace enforcement program, and also may look into several delayed OSHA rulemakings. Additionally, with the likely failure of the Congress to complete the reauthorization of the Workforce Investment Act (WIA) — a priority for the Home Builders Institute and many local home builders associations that engage in workforce training — WIA will likely be an early priority for the committee.
In the Senate, the leadership positions on the Health, Education, Labor and Pensions Committee will switch, with Sen. Edward Kennedy (D-Mass.) becoming chairman and Sen. Mike Enzi (R-Wyo.) the ranking member.
House Energy and Commerce Committee/Senate Energy and Natural Resources Committee
In the House, Rep. John Dingell (D-Mich.) will take over the chairmanship in the 110th Congress, returning to the post he held before Republicans took control. Rep. Rick Boucher (D-Va.) will likely be the new chair of the Energy and Air Quality Subcommittee, which is of special interest to NAHB.
Rep. Dingell’s energy agenda includes reducing America’s dependence on fossil fuels and foreign oil, expanding the use of alternative energy technologies and increasing the use of bio-based fuels such as those used to run hybrid vehicles. Climate change legislation is also likely to become a key issue this session as a follow-up to state initiatives, like California, that have set caps on greenhouse gas emissions.
Extending the energy efficiency tax credits for home building that passed as part of the Energy Policy Act of 2005 will fall solely under the jurisdiction of the House Ways and Means Committee moving forward.
Sen. Jeff Bingaman (D-N.M.), a long-time supporter of caps on greenhouse gas emissions and measures to reduce dependence on foreign oil and fossil fuels, will become chairman of the Senate Energy and Natural Resources Committee.
In the 109th Congress, he supported green building legislation that incorporated a mandate for Leadership in Energy and Environmental Design for Homes (LEED), a position that runs counter to NAHB’s support for voluntary and market-driven green building programs. However, Bingaman is a supporter of tax credits for energy efficiency in home building and also sits on the Senate Finance Committee, which has jurisdiction over legislation to extend the provisions for tax credits for energy efficiency in new homes that passed as part of the Energy Policy Act of 2005.
House Financial Services Committee/Senate Banking Committee
The House Financial Services Committee and the Senate Banking Committee have jurisdiction over federal housing programs and mortgage finance and financial services providers, including the Government Sponsored Enterprises (GSEs) Fannie Mae, Freddie Mac and the Federal Home Loan Banks.
After serving several years as the ranking member of the House Financial Services Committee, Rep. Barney Frank (D-Mass.) will become the panel’s new chairman. Current Financial Services Committee Chairman Michael Oxley (R-Ohio) is retiring at the end of the year, and either current Capital Markets Subcommittee Chairman Richard Baker (R-La.) or current Financial Institutions Subcommittee Chairman Spencer Bachus (R-Ala.) is expected to become the ranking member.
Rep. Frank has said that his top priority for the panel will be affordable housing. He has already talked to Rep. Charles Rangel (D-N.Y.), the incoming chairman of the House tax writing committee, about beefing up tax credits for low-income housing. Frank has also stated his support for getting the federal government back into the business of building subsidized housing.
With Sen. Paul Sarbanes (D-Md.) retiring, Sen. Christopher Dodd (D-Conn.) is expected to become the new chairman of the Senate Banking Committee, and current chairman Richard Shelby (R-Ala.) is likely to become the ranking member.
Should GSE reform legislation stall in the 109th Congress lame-duck session, the committees will take the lead on any GSE regulatory reform measures introduced in the 110th Congress and decide whether to extend the Terrorism Risk Insurance Act, which is set to expire at the end of 2007.
Frank has indicated that he wants to enact a GSE reform bill similar to H.R. 1461, legislation passed in the 109th Congress and supported by NAHB, suggesting that a Democrat-written bill in the 110th Congress wouldn’t cap the amount of mortgage-backed securities each GSE could hold in their portfolios and would include a similar affordable housing fund to the one passed by the House in the 109th Congress.
In addition, Sen. Dodd has said publicly that he approved of the House-passed GSE reform bill in the 109th Congress and will try to pass a similar measure next year. A Dodd-written bill in the 110th Congress wouldn’t cap the amount of mortgage-backed securities each GSE could hold in their portfolios and would include a significant affordable housing fund component — a significant departure from the bill passed by the Senate Banking Committee in 2005 and opposed by NAHB.
Federal housing programs also fall under the auspices of the Housing and Community Opportunity Subcommittee of the House Financial Services Committee and the Housing and Transportation Subcommittee of the Senate Banking Committee. Maxine Waters (D-Calif.) is expected to chair the House panel and Sen. Jack Reed (D-R.I.) is expected to wield the gavel in the Senate.
The subcommittees will likely examine several housing issues, including boosting affordable housing programs, expanding Federal Housing Administration mortgage insurance and cracking down on predatory lending.
Judiciary Committees
The Senate and House Judiciary Committees have jurisdiction over private property rights, tort reform and immigration issues. Further, all federal judicial appointments must go before the Senate Judiciary Committee for confirmation, which can be highly contentious politically. Generally, controversial issues have been decided along partisan lines.
In the House, Rep. John Conyers (D-Mich.), who has long served as the ranking member of the committee, will take over as chairman next year. He is a staunch opponent of NAHB’s private property rights legislation, and in the current Congress he authored legislation that would set exposure limits and federal building standards for mold. Conyers is expected to reintroduce this legislation in the 110th Congress, and as chairman, he would be able to advance that bill, which would be a significant concern for NAHB.
Further efforts on legal reform are unlikely. However, NAHB may be able to partner with Conyers to examine how the Fair Housing Act can be better used to promote the construction of affordable and entry-level housing. It is also likely that NAHB will be able to work with Conyers on more comprehensive immigration reform legislation similar to the bill passed by the Senate in the 109th Congress.
With the Democrats taking control of the Senate, Sen. Patrick Leahy (D-Vt.) will take over the reins of the Judiciary Committee. Leahy is likely to focus on consumer issues — prescription drug pricing, gas pricing — as well as major national issues such as the surveillance and interrogation of terrorists. Further efforts to reform the legal system are unlikely, although he may attempt to revive an effort to establish a multi-billion-dollar trust fund to compensate victims of asbestos exposure.
In the short-term, it remains unclear whether the committee will seek to take up property rights legislation during the lame duck session. Two property rights bills have been passed by the House, one dealing with the Kelo eminent domain case, the second concerning access to federal courts, which is supported by NAHB.
If the Senate panel is unable to move forward on access to federal courts legislation in the lame duck session, the issue is not expected to be revived next year because of strong opposition from Leahy, who will be in a position to block its movement.
However, NAHB may find in Sen. Leahy an ally to help examine how the Fair Housing Act can be better used to promote the construction of affordable and entry-level housing.
Additionally, Sen. Leahy is likely to work closely with fellow Judiciary Committee member Sen. Ted Kennedy to push comprehensive immigration reform legislation again in the 110th Congress. That effort is likely to be met with strong support from Democrat leadership in the Senate.
House Resources Committee
The House Resources Committee has jurisdiction over the Endangered Species Act (ESA), the Magnunson-Stevens Fisheries Act (MSFA), domestic timber supply issues, federal land designations and water supply issues.
Rep. Nick Rahall (D-W. Va.) will take over the chair of the committee from Rep. Richard Pombo (R-Calif.), who did not win reelection. In past Congresses, Rep. Rahall has opposed NAHB-supported Endangered Species Act (ESA) reform legislation championed by Pombo. Rep. Rahall supported NAHB’s private property rights legislation in the 109th Congress.
House Transportation and Infrastructure Committee
This committee has jurisdiction over all modes of transportation, water quality, infrastructure and brownfields.
Rep. Jim Oberstar (D-Minn.) will replace Rep. Don Young (R-Alaska) as chairman of this important House committee. The panel deals with smart growth and air quality and water quality issues. NAHB’s storm water legislation is also under the jurisdiction of this committee. During the 109th Congress, NAHB was unable to win the support of Oberstar on the storm water legislation, which dims the prospects of movement in the 110th Congress.
Rep. Jimmy Duncan (R-Tenn.), the champion of NAHB’s storm water legislation, is being replaced as chairman of the Water Resources Subcommittee by Rep. Eddie Bernice Johnson (D-Texas). Her subcommittee will have jurisdiction over wetlands and water infrastructure, including storm water. NAHB was unable to secure Rep. Johnson as a cosponsor of the storm water bill.
Senate Environment and Public Works Committee
Sen. Barbara Boxer (D-Calif.) will chair the powerful Environment and Public Works Committee, which has jurisdiction over the Clean Water Act, ESA, the Clean Air Act and transportation. This committee will legislate on wetlands jurisdiction, storm water legislation, ESA reform and smart growth.
Under the leadership of former Chairman Jim Inhofe (R-Okla.), the committee had a difficult time passing major environmental legislation, such as ESA reform and Clean Air Act amendments, because Sen. Lincoln Chafee (R-R.I.) routinely sided with Democrats to block Chairman Inhofe's legislation. With Chafee's defeat, the Republican side of the dais will be more united, but as the minority party, they will face an uphill battle when trying to stop any Democrat initiatives.
While the panel is not expected to support many of NAHB’s initiatives, the association will work with panel members to show how excessive environmental regulations continue to affect housing affordability.
Tax Writing Committees
The Senate Finance Committee and the House Ways and Means Committee have jurisdiction over tax issues, health care, Social Security, trade and revenue measures. Max Baucus (D-Mont.) becomes chairman and Charles Grassley (R-Iowa) moves to ranking member.
Both support housing and housing incentives in the tax code, share many common concerns on tax issues and have a good working relationship. One specific example is tax reform, where both senators support some type of reform of the code.
On other tax issues, Sen. Baucus is not likely to support extending all of the President’s 2001 and 2003 tax cuts past 2010. He, however, could be a strong ally on NAHB’s affordable housing initiatives on the Low Income Housing Tax Credit (LIHTC), homeownership tax credit and exit tax relief. Both the chairman and ranking member have supported NAHB on establishing a homeownership tax credit and we will work with them on this issue again in the 110th Congress.
The House Ways & Means Committee will see significant change in the 110th Congress under its new chairman, Rep. Charles Rangel (D-N.Y.). He will assuredly be a strong ally and partner on affordable housing issues, especially modernizing the Low Income Housing Tax Credit, establishing a homeownership tax credit and providing exit tax relief. However, he does not support repeal of the estate tax or renewing all of the 2001 and 2003 tax cuts. In the area of tax reform, Rep. Rangel has called for a “simpler, fairer and more responsible” tax code, leaving the specifics unclear.
On the Republican side of the committee, it is still not known who will serve as the ranking member. Following the announced retirement of current chairman Bill Thomas (R-Calif.) in early 2006, Reps Jim McCrery (R-La.), Clay Shaw (R-Fla.) and Nancy Johnson (R-Conn.) all campaigned for the chairmanship, assuming continued Republican control in the new Congress. However, Reps. Shaw and Johnson both lost their reelection bids and it remains to be seen if Rep. McCrery wants the job of ranking member under a Democrat-controlled committee. For his part, Rep. McCrery is strong on NAHB issues and has expressed support in the past for housing incentives in the tax code.
For more information, e-mail Michael Strauss at NAHB, or call him at 800-368-5242 x8252.
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