The House voted Thursday to spare banks and borrowers of mortgages backed by Fannie Mae and Freddie Mac from being tapped to pay for highway spending.
Lawmakers voted overwhelmingly for an amendment to take provisions affecting banks and the government-sponsored enterprises out of a transportation bill that passed the House. The amendment, offered by Rep. Randy Neugebauer, R-Texas, passed 354-72.
Without the amendment, the bill would have paid for highway spending partly by cutting the dividend that the Federal Reserve pays to its member banks above a certain size from 6 percent to 1.5 percent. It also would have diverted the fees charged by Fannie and Freddie for backing mortgages for the highway bill.
The banking industry strongly opposed lowering the dividend.
The Federal Reserve also criticized the measure. Fed Vice Chairman Stanley Fischer warned Wednesday night that it would be “dangerous” to the central bank’s independence.
“Instead of merely delaying the decrease, this revised amendment the House passed with over 350 votes responsibly takes it off the table,” a spokesman for Neugebauer told the Washington Examiner. “In addition to addressing the Fed dividend issue, the amendment protects hardworking taxpayers from further entrenching the [government-sponsored enterprises] by striking the [fee] increase from the Senate version.”
The amendment would make up the savings by liquidating a capital surplus account made up of earnings the Fed has retained from investing member banks’ money.
