Realtors® meet with Pennsylvania senators in Washington, D.C.

Fifty Pennsylvania Realtors® met with our two senators yesterday at the Capitol Visitor Center while attending NAR’s Legislative Meetings in Washington, D.C. We asked the senators to speak about national issues facing the real estate industry.

The senators were questioned about HR 4893, the “Risk Management and Homeownership Stability Act,” which would prohibit the use of guarantee fees (G-fees) from being extended, increased and diverted for unrelated government spending. Sen. Pat Toomey said he was opposed to using G-fees as an ATM and believes it’s bad policy to do so. He said he’s worried it would be a temptation to use the G-fees as a piggy bank. Sen. Bob Casey agreed that G-fees should not be used to fund other programs outside housing.

Both senators were urged to support HR 3700, the “Housing Opportunity through Modernization Act,” and HR 2901, the “Flood Insurance Market Parity and Modernization Act,” both of which recently unanimously passed the House.

HR 3700 would make reforms to the Federal Housing Administration (FHA) condominium loan program, federal assisted housing programs and Rural Housing Service loan programs. Casey told us HR 3700 seems to be a good policy, but it has not been introduced in the Senate. Toomey agreed that with broad support in the House, he would further research the bill.

In discussing flood insurance, both senators agreed that encouraging private flood insurance options would be advantageous to homeowners in Pennsylvania. Casey said he recently met with Teresa Miller, Pennsylvania Insurance Department commissioner, to discuss the challenge of giving homeowners more of a choice for flood insurance. Toomey said he would like to see flood insurance move more in the direction of private insurance options.

Commercial Realtors® urged the senators to protect 1031 like-kind exchanges, which encourage growth by permitting real estate held for investment to be exchanged for property of a like-kind on a tax-deferred basis. Toomey said he thinks the 1031 provision is a good one, and believes eliminating it would stifle the economy. Casey said it would be a huge blow if eliminated.

Realtors® also encouraged the senators to maintain the mortgage interest deduction (MID) and property tax deduction on federal income tax as members of Congress begin to look at tax reform. Casey said he believes MID is a huge issue for everyone and has grave concerns about taking this deduction away. Toomey said he doesn’t believe those deductions are going away, but that if massive tax reform is considered, everything will be on the table. He said maximizing economic growth and lowering marginal rates will have to be considered.