Press
FedHall’s Len Wolfson provides insight on HUD Leadership Vacancies
By Monica Hogan
Nearly 11 months into President Biden’s administration, FHA and Ginnie Mae continue to wait for Senate-confirmed leadership.
Industry observers said a full Senate vote on Julia Gordon’s nomination as FHA commissioner could slip into 2022, given the busy December facing the upper house.
Former FHA Commissioner Brian Montgomery said, with the Senate split 50-50, the Democrats would “need to get every Senator there” for a confirmation vote, “and then you have to have the vice president there, and she’s a busy person.”
Montgomery waited almost seven months for a vote to become FHA commissioner in the Trump administration, even though he had held the job earlier under the Bush and Obama administrations.
Dave Stevens, also a former FHA commissioner, said given that the Senate Committee on Banking, Housing and Urban Affairs’ vote on Gordon was split along party lines, Senate Majority Leader Chuck Schumer, D-NY, would need to allow for floor debate before Gordon’s nomination comes up for a full Senate vote.
Meanwhile, a Senate Banking Committee vote on Alanna McCargo’s nomination for Ginnie president could come as early as this week and may include at least some Republican support.
Stevens said McCargo could be confirmed by the end of the year if her name can be added to a “nom-a-rama” slate of other nominees up for a Senate floor vote sometime this month.
Michael Bright, CEO at the Structured Finance Association and former Ginnie acting president, said he’s more disappointed than surprised at how long the confirmation process is taking. “Nominations can get backlogged,” especially for appointees below the Cabinet secretary level, he noted.
Who better than Bright to know how long these processes take? He was nominated as Ginnie president in May 2018 by President Trump. But his nomination hadn’t come up for a Senate vote before he quit the agency in January 2019. The fact that his nomination was never confirmed was widely seen as the reason for his departure.
Ted Tozer, who served as Ginnie president from February 2010 until January 2017, said he’s somewhat surprised at how long McCargo’s confirmation process has taken, noting there’s been nothing to indicate there’s anything controversial about her.
“Since I left in January 2017, [Ginnie] hasn’t had a confirmed president in place,” Tozer said. “It’ll be five years in January. That’s really crazy.”
Although Ginnie career staff “is really professional” and “can do a good job,” Tozer said political leadership has access to the secretary of the Department of Housing and Urban Development and other federal departments that career staff normally don’t.
Len Wolfson, former acting FHA commissioner, said as FHA continues to address COVID-19-related forbearance, it needs special focus that only a commissioner can provide.
Meg Burns, executive vice president at the Housing Policy Council, said ideally an agency head would have four years to implement a vision, but “as the clock ticks away, you have less and less time to implement a strategy.”
However, Ed Pinto, director of the American Enterprise Institute, said he’s in no hurry to see new political leadership at FHA, noting that the career staff is making sure “the wheels of government grind along.”
Pinto believes a Ginnie president is a perfunctory role, but the FHA commissioner has more regulatory flexibility. “For good or ill,” he said, “the FHA commissioner could have a much larger policy impact” when it comes to mortgage insurance premium rates, for example. He said lower premiums lead to higher home prices, which hurt the first-time homebuyers that FHA is meant to help.
Further, Tozer said the nominees could get frustrated with the wait. Given McCargo is a senior advisor to HUD Secretary Marcia Fudge, she’s already working within the administration, he said. “But Julia is in a quandary” because she’s still in the private sector. She faces challenges on when she should resign and how she continues to make plans in her current job.
Another issue that could come up if the confirmation process extends into a new year, sources said, is that the nominees may have to update their financial paperwork.