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Senate banking committee approves Watt’s nomination to head housing finance agency

Kevin Thibodeaux
McClatchy Washington Bureau

WASHINGTON The Senate Banking Committee on Thursday approved the nomination of U.S. Rep. Mel Watt of Charlotte as the next head of the Federal Housing Finance Agency.

The 12-10 vote was split along party lines, with Democrats backing their party’s longtime congressman from North Carolina.

As expected, Watt’s nomination faced considerable criticism from Republicans on the committee, who questioned the placement of a longtime politician at the head of the FHFA.

Sen. Mike Crapo, R-Idaho, said the director, who would be in charge of Fannie Mae and Freddie Mac, needs to be both apolitical and possess an in-depth knowledge of the housing finance industry.

“This position is like no other position in our government. As conservator, this nominee would actually operate Fannie Mae and Freddie Mac, (whose) combined portfolios exceed $5 trillion. In fact if confirmed, this nominee would stand alone as regulator, operator and shareholder of Fannie Mae and Freddie Mac.”

Crapo said he wants a director who “will be an apolitical financial regulator with technical expertise and someone who will resist political pressure from all sides of the political spectrum.”

The banking committee chairman, Sen. Tim Johnson, D-S.D., defended Watt’s experience, saying he has the kind of in-depth expertise needed to lead the agency.

“Congressman Watt has over 40 years of experience in housing, real estate and other financial service issues as an attorney and member of the House Financial Services committee. In his 20-plus years practicing law, he has personally walked hundreds of families through real estate closings. This is the kind of in-depth expertise we need leading the FHFA,” Johnson said.

The committee’s approval is a significant hurdle in what will likely be a somewhat smoother approval before the Democrat-controlled Senate. It is unclear when the final vote will take place.

Despite the partisan criticism, some N.C. Republicans have expressed their support for Watt.

“Having served with Mel, I know of his commitment to sustainable federal housing programs and am confident he will work hard to protect taxpayers from future exposure to Fannie Mae and Freddie Mac. I look forward to working with Rep. Watt in his new role to find new ways to facilitate more private sector involvement in the housing and mortgage markets,” Sen. Richard Burr, R-N.C., said.

Democratic Sen. Kay Hagan is firmly in Watt’s corner.

“Throughout his career Mel has been a champion for affordable housing in North Carolina and across the country, and has worked tirelessly to protect families from predatory and deceptive lending practices,” Sen. Kay Hagan, D-N.C., said in May.

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