At press time, the U.S. House of Representatives has completed its floor action on the “The American Recovery and Reinvestment Act of 2009,” better known as the Stimulus Package. The Senate is slated to take up its version of the bill and dispense amendments through the week of February 2.
Stimulus is on a fast track due to growing signs that the depth and breadth of the recession are greater than most had expected and may be accelerating.
It appears that the only entity with credible muscle to mitigate this recession is the federal government, backed by nothing less than the full faith and credit of the United States of America. Companies and associations such as ASHI continue to intensify their government relations efforts to bring the maximum government assets to bear in order to gain some traction on the recession.
ASHI and other realty-related organizations are working on stimulus to ensure that a sizable portion of the funds will have direct or nearly direct impact on the downturn in the home sales industry. The initial House version of the Stimulus Package, endorsed by President Obama, is being criticized by many for not focusing sufficient attention on housing issues. ASHI joins in reminding policy-makers that the current recession began with subprime mortgage defaults directly related to housing, starting a cascade of mortgage failures, foreclosures, falling assessments and tax revenues.
By that reckoning, efforts to stimulate the homes sales industries should be central to the government’s efforts to turn the tide.
We expect some amendments in the Senate version of the bill that could reduce mortgage rates, focus more bailout money on housing relief and enhance the new homebuyer tax credit (which ASHI helped support). Because the Democratic leadership in the Senate has taken a liberal approach in allowing amendments for consideration during floor debate, there is no firm list of amendments likely for consideration. ASHI will closely monitor the floor debate, looking for opportunities to support amendments that focus more efforts on home sales, home retrofit/home improvement incentives that might spur inspection business and other proposals that might have similar impacts.
Further, we expect President Obama to announce a new initiative to address foreclosures specifically at any time.
By any measure, the Stimulus Package will inject large sums into the U.S. economy. Based on programs already in the House version of the bill, many of which will survive in the final version that becomes law, ASHI believes that a number of these programs will provide new revenue opportunities to ASHI members if they know where to look.
Once the final version passes Congress and is ready for the president’s signature, ASHI intends to dissect the package, looking for programs that might provide inspection — and revenue — opportunities for ASHI members. ASHI will communicate a list of the most likely programs with potential to the membership as soon as is practicable following passage.
ASHI members will want to ponder how funds might impact their localities, how and where they might be applied. Members may need to contact local government authorities who will have access to funds, either through direct appropriations, or via grant programs for which local grant applications will be necessary or via funds allocated to the states for distribution.
Stimulus funds may have differential impacts across the country based, in significant part, on the savvy of state and local officials to apply for and use funding arising from such a hybrid source as a Stimulus Package. ASHI hopes to give its membership a leg up in strategizing contacts with their local government entities to inquire about funding and revenue opportunities generated by the package.
Post-stimulus, ASHI members should expect another round of hearings and legislation to further shore up the still-shaky credit markets. We then expect Congress to return to additional fervent hearings and legislation to shore up the housing markets. ASHI already has contacted the housing subcommittees to express interest in participating in those efforts.
We will have more on the next phases of home sales legislation in future editions of the ASHI Reporter.