LONG-TIME CU CHAMPION
RETIRES FROM CONGRESS
WASHINGTON-Ohio Republican Rep. Steve LaTourette, who as a little-known second-term member of Congress co-sponsored and led to passage the landmark credit union bill HR 1151, the 1998 Credit Union Membership Access Act, is retiring from Congress after nine terms.
In announcing his retirement, LaTourette denied he was unhappy that he was not given a committee chairmanship and cited instead the partisan bickering in Congress. "Words like 'compromise' have been like dirty words," said LaTourette.
LaTourette, 58, cited the difficulty of passing the highway transportation measure as one of his biggest frustrations in the current Congress at his news conference in Painesville, Ohio. "There are people on the right and on the left who think that if you compromise you are a coward, you are a facilitator, you are an appeaser," LaTourette said. With "very little opportunity" for compromise, he said he concluded "there are so many times you can run your head into a cement wall."
LaTourette will formally withdraw his re-election bid Aug. 8. Doing so then avoids the need for a special election and throws the decision on a new candidate to the party leaders. LaTourette said he won't be involved in the process but would offer opinions if asked.
LaTourette, a former state prosecutor, was chosen by then-House Speaker Newt Gingrich and House leaders because he was a strong credit union supporter and had no ideological baggage to join Democrat Paul Kanjorski of Pennsylvania as co-sponsor the bill that overturned the Supreme Court decision finding NCUA's multiple group field of membership in violation of the Federal CU Act, which required credit unions to have a single common bond.
The bipartisan co-sponsorship of the bill gave credit unions the ability to attract a broad consensus of both parties and the bill passed easily in both the House and Senate, before being signed into law by President Clinton. Kanjorski himself, who went on to distinguish himself as the most reliable credit union supporter in Congress, was defeated in a bid for a 14th House term in 2010.
"Before he introduced H.R. 1151 Congressman LaTourette was a little-known second-term representative who hadn't carved out a niche for himself," John McKechnie, an independent credit union lobbyist who worked for CUNA at the time, told Credit Union Journal. "But he turned out to be the indispensable man for credit unions: someone who symbolized the then-new Republican majority, who could work well across the aisle, who could be trusted by House leadership to shepherd a controversial bill through the process."
The landmark credit union bill, which became known by its legislative identification, HR 1151, reversed the 1996 Supreme Court decision by formalizing NCUA's multiple groups policy, duplicated in all of the states, thus allowing credit unions to add unrelated select groups to their fields of membership. The bill overwhelmingly passed Congress and was signed into law in August 1998 by President Bill Clinton.
Though he never again played a major role for credit union legislation after that, LaTourette was always a reliable vote and he signed on as co-sponsor to many credit union bills, including the CU Regulatory Improvements Act and numerous efforts to raise the member business loan cap.
FHFA: FANNIE, FREDDIE CAN'T
REDUCE MORTGAGE BALANCES
WASHINGTON-The federal regulator for Fannie Mae and Freddie Mac said last week that he will not allow the companies to reduce loan balances of troubled borrowers, saying there would be no clear-cut financial benefit and that such a move could cause some homeowners to intentionally default in hopes of getting taxpayer aid.
"We concluded that the potential benefit was too small and uncertain, relative to the known and unknown costs and risks," said Edward DeMarco, acting director of the Federal Housing Finance Agency. DeMarco raised the question of what the long-term effects of principal forgiveness might be, saying that rewriting valid contracts could spook investors and increase mortgage costs in the future.
The decision came after months of internal analysis heated pressure from the Obama administration, Democratic lawmakers on Capitol Hill and housing advocates, who argued that principal reduction was an essential tool needed in helping to soften the fallout of the housing crisis.
In a letter to the Senate Banking Committee, DeMarco said principal reductions "would not make a meaningful improvement in reducing foreclosures in a cost effective way for taxpayers. Yet there are continued improvements that can and should be made to strengthen the Enterprises' loss mitigation and borrower assistance efforts, and to improve the operation of the housing finance market. These efforts include further streamlining refinance opportunities, enhancing the short sale process, and reducing lender uncertainty that could inhibit new mortgage lending."