By Benton Ives, CQ Staff

A top House lawmaker suggested Congress is close to a final agreement on a comprehensive housing package, although the chambers still have to resolve several differences before clearing the measure.

“I think it’s a very manageable set of” differences, said House Financial Services Chairman Barney Frank , D-Mass. Most of them, including budgetary concerns over a set of housing-focused tax breaks, don’t present a big enough threat to derail the measure (HR 3221).

“I think we can have conceptual agreement by the end of the week” and send final legislation to the president’s desk by mid-July, Frank said on June 20, as the Senate continued work on the legislation. The House passed its version in May.

The measure could run into trouble with the White House, which has threatened a veto over $3.92 billion in grant money for rehabilitating foreclosed properties, along with other provisions the administration dislikes.

Given overwhelming bipartisan support for the measure in the Senate, President Bush may have a hard time following through on the threat. Still, an amendment is expected next week in the Senate to strike the grant money provision, and Frank has indicated he’s willing to forgo it.

The Senate is expected to pass the package as soon as Tuesday, after dispensing with remaining amendments. Lawmakers are pressing ahead with the landmark measure, which could help hundreds of thousands of borrowers threatened with foreclosure, amid one of the worst housing crises since the Great Depression.

The package includes a $300 billion expansion of the Federal Housing Administration’s insurance programs that would help some homeowners refinance loans they cannot afford. It also includes a regulatory overhaul of mortgage giants Fannie Mae and Freddie Mac, an overhaul of the FHA and a $14.5 billion package of housing-focused tax breaks.

Outstanding Issues

The Senate package includes $14.5 billion in housing-related tax breaks, including a refundable tax credit worth up to $8,000 for first-time homebuyers. But the measure is not fully offset, leaving about $2.4 billion worth of tax breaks not paid for.

House lawmakers are expected to come up with provisions to offset that shortfall. One possibility would be to require brokers to report their customers’ initial investment, or basis, in securities to prevent taxpayers from underreporting capital gains.

Another outstanding issue is the effective date for Fannie and Freddie’s new regulator. The Senate bill’s provision would take effect immediately on enactment, while the House would like to delay the start date for the new regulator so he or she could be appointed by the next president.

But Frank said it might not matter, because the Senate would be unlikely to confirm any Bush administration nominee for the position.

How the regulator can control Fannie and Freddie’s mortgage portfolios, which some see as a potential threat to the larger economy, also needs to be resolved. The Senate bill would give the new regulator wide latitude to set limits on their portfolios, which could end up curbing the companies’ abilities to buy and hold mortgages, as opposed to packaging and selling them as securities.