Fannie Mae (FNMA)

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‘Jumpstart GSE Reform’ Bill is Still Alive, With a Possible Sunset Provision

By Carisa Chappell
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The Jumpstart GSE Reform Act, reintroduced in Congress in September, is still on the table for negotiations and recently reemerged with a possible sunset provision, according to firms tracking the bill, including Compass Point Research & Trading.
The legislation would bar the Treasury from selling its senior preferred stock in Fannie Mae and Freddie Mac and prevent increases in guaranty fees to fund other government spending. According to Compass Point, lawmakers are considering limiting the language in the proposal by attaching a sunset provision.
Compass Point predicts the measure now has a 40 percent to 60 percent chance of passage as part of the omnibus spending bill. Analyst Isaac Boltansky noted that GSE shareholders would not be happy because it would “foreclose on an administrative path for action and leave the issue squarely in the hands of Congress where it would likely languish until at least 2017.”
Earlier this month, a handful of fair housing advocates and civil rights groups urged House leaders to reject the Jumpstart GSE Reform and any attempts to include it in the FY 2016 appropriations agreement. They said the act would do more to hinder Fannie and Freddie than help.