A comprehensive housing bill supported by both parties and the White House inched closer to passage last week. But never doubt the power of the private equity and banking industries and their congressional enablers to screw up a sure thing. The housing bill is still far from a done deal. Here’s what happened:
The Senate passed a comprehensive housing bill in March, based largely on the partnership of Elizabeth Warren, the ranking Democrat on the Senate Banking Committee, and Tim Scott, who chairs both the Banking Committee and the National Republican Senatorial Committee. Scott, facing a Trump-induced inflation crisis and the prospect of a Democratic wave election, was eager for a win that could enable Republicans to champion a consumer-friendly issue.
The bipartisan bill passed by an impressive 89-10. The White House signaled its support.
The bill is a medley of good ideas, many of them bipartisan. For instance, it includes legislation proposed by progressive Sen. Lisa Blunt Rochester (D-DE) and conservative Sen. Bernie Moreno (R-OH) to provide grants to encourage local governments to use pattern zoning and adopt preapproved designs for mixed-income housing projects. It is endorsed by the American Planning Association, the Congress for the New Urbanism, Up for Growth Action, National Apartment Association, Smart Growth America, Main Street America, and National Association of Realtors, groups that seldom work together.
Another section of the legislation streamlines environmental reviews to promote housing development, but without sacrificing basic environmental standards. It would also promote increased production of factory-built manufactured units that are cheaper to produce than most traditional homes.
The measure would also extend and expand a HUD program aimed at maintaining long-term affordability in public-housing units and codify protections for tenants. It would subsidize home repairs as well.
The most contentious part of the Senate bill prohibits private equity from purchasing single-family homes and requires them to sell any single-family homes being used as rentals after seven years. The private equity provisions stayed in the Senate bill after Trump, wanting to look populist, posted on Truth Social: “I called for Congress to save the American Dream of Homeownership, and ban these purchases, PERMANENTLY!”
AFTER THE BILL PASSED THE SENATE, the legislation then went to the House, where Rep. French Hill of Arkansas, chair of the House Financial Services Committee, larded it up with a variety of special-interest provisions, including stripping out private equity measures, and adding several unrelated measures to weaken bank regulation, plus language pushed by the crypto industry to stop the Fed from issuing a digital currency.
Warren and Scott, with the support of Senate Majority Leader John Thune, warned that there was no way that the Senate would pass the House bill. Thune, whom Warren has assiduously courted, told reporters, “I wish they would just pick up the Senate bill.” Reportedly, the White House asked Hill and House Speaker Johnson to relent.
When the House finally passed its housing bill last Wednesday, it was a pleasant surprise. Gone were some of the most objectionable provisions. The bill retained Senate language protecting the right of union workers on federally subsidized housing to be paid prevailing wages. And it maintained the provision banning new private equity purchases of homes. The overwhelmingly bipartisan vote was 396-to-13. The White House evidently played a role in demanding a bill from the House that might be acceptable to the Senate.
However, the House bill still stripped several of the bipartisan provisions of the Senate bill as well as the requirement for private equity to sell off the houses that it owns. The deleted provisions include a bipartisan measure proposed by Sens. Thom Tillis (R-NC) and Brian Schatz (D-HI) to get disaster assistance out to communities faster and more efficiently. This provision has been a priority for the National Governors Association, National League of Cities, National Low Income Housing Coalition, and others.
It also cut a measure sponsored by Sen. John Kennedy (R-LA) to incentivize high-cost, low-supply cities and towns to build more housing, by giving bonus Community Development Block Grant funds to localities that exceed the median rate of homebuilding. It deleted a provision sponsored by Sen. Catherine Cortez Masto (D-NV) to help maintain, upgrade, and stabilize manufactured housing communities.
These and other provisions in the Senate bill reflected the careful work of Warren and Scott to fashion legislation that was far from the typical Christmas tree bill. Rather, the measure took good policy ideas from both sides of the aisle in order to build a bipartisan consensus.
Such provisions highlight a key difference between the House and Senate in the Trump era. True bipartisanship is still alive in the Senate, but it takes skilled legislative craftsmanship. It is all but dead in the hyper-partisan House.
THOUGH THE ORIGINAL HOUSE BILL was far worse, Scott and Warren warned that the Senate was not about to rubber-stamp the latest House version. Trump has frequently put the arm on House Speaker Mike Johnson to do the president’s bidding. Let’s see if he will weigh in this time on behalf of good bipartisan policy. He is said to be still angry at Senate Majority Leader Thune, for refusing to fire the Senate parliamentarian who blocked funding for his East Wing ballroom.
However, dozens of Republican senators are now in open rebellion against Trump’s $1.776 billion slush fund. Trump may need to appease the Senate with a win on a popular housing bill—or he may be so furious at Senate Republicans’ resistance to his payoff to his miscreants that he attacks them for their refusal to bend the knee.
Unlike most other progressives who lead from the left as outsiders, Warren is skilled at the business of legislating and deeply committed to finding ways to make legislative agreements with Republicans on measures that are usually net-progressive. All this takes both extensive personal relationship-building as well as mastery of the intricacies of legislating, in this case through her alliance with Tim Scott. It shows what Congress once was, and still can be.
With Congress in recess all this week, the earliest the Senate will take up the housing package is June. Given all the work that has gone into fashioning this bill, as well as the White House interest in claiming an anti-inflation success, you have to bet that some version will eventually pass—and that it will look a lot like the Senate bill.
