White House makes push on Watt nomination

The White House urged the Senate on Monday to vote on Mel Watt’s nomination to become the nation’s top housing regulator as the mortgage finance reform effort picks up steam. 

The North Carolina Democrat’s nomination has stalled out since gaining approval from the Senate Banking Committee in July to head up the Federal Housing Finance Agency (FHFA), despite the push from the White House. 

Senate Majority Leader Harry Reid (D-Nev.) filed cloture Monday on Watt’s nomination but he is not expected to gain the 60 votes needed to move along for final approval. 

Housing and financial industry leaders met on Monday with White House senior staff including Denis McDonough, Valerie Jarrett, Miguel Rodriguez and Gene Sperling on the need for the Senate to allow a “fair up or down vote” on Watt’s nomination, according to White House spokeswoman Amy Brundage.

“The administration officials made clear that the Watt confirmation is a top White House priority, that the Senate should move forward to confirm him this week, and that the president and his senior team will continue to push hard for Watt until he is confirmed and in place,” she said. 

“The president believes that Rep. Watt is the very best person to lead the agency at this important time for the housing market and our economy, and that having a confirmed FHFA director in place will help promote certainty for the housing industry.”

The White House officials also reiterated the administration’s strong support for housing finance reform and lauded the bipartisan work underway by the Senate Banking Committee to draft legislation. 

The encouraged industry leaders “to engage in the dialogue of housing finance reform with the goal of supporting the introduction of a bill as soon as reasonably possible.”

Since Watt was nominated, Republicans have questioned the Obama administration’s decision to choose a politician to lead the agency. 

Several Republicans, including his home state senator, Richard Burr, have expressed support but Watt will still probably fall just shy of the number needed to move toward confirmation. 

Otherwise, Republicans and Democrats remain divided over Watt’s bid to lead the FHFA through what is expected to be a time of major changes for Fannie Mae and Freddie Mac. 

Senate Banking Committee Chairman Tim Johnson (D-S.D.) said Monday that “there is no legitimate reason Mel Watt should not be confirmed.”

“It is important to fill this role as soon as we can, so the agency can fully assist in helping stabilize the housing market as our economy continues to recover from the financial crisis,” he said. 

“Mel’s decades of experience with housing finance policy, and his proven ability to get results by working with colleagues, consumer advocates, and industry leaders make him an ideal pick to lead the FHFA.

If Watt’s bid fails, it would be the second of Obama’s nominees for the job who couldn’t get through the Senate. 

Two years ago, the White House chose North Carolina’s top banking regulator Joseph Smith for the slot but Republicans expressed concern that he would not act independently enough of the Obama administration. 

It also means that the Obama administration would have to continue to work with acting director Edward DeMarco, with whom they haven’t seen eye-to-eye on policy issues, including allowing fro principal mortgager eductions for some homeowners who have kept up with their payments but are underwater on their mortgages. 

DeMarco has been acting director for four years and has discussed in recent days that he is moving Fannie and Freddie toward an eventual transition where they would be wound down. 

Industry participants at the meeting included Doug Bibby, president, National Multi Housing Council, Jerry Howard, CEO, National Association of Home Builders, Frank Keating, president and CEO, American Bankers Association, Dave Stevens, president and CEO, Mortgage Bankers Association, Scott Talbott, senior vice president for Public Policy, Financial Services Roundtable, and Gary Thomas, president, National Association of Realtors.