Lawmakers return to work Wednesday with roughly eight weeks to enact bills to transform the nation's financial and bankruptcy laws, tweak the tax code, and bail out farmers.

And those are just the bills that financial services interests are pushing. Congress is also grappling with the patients' bill of rights, gun control, campaign finance reform, and more than 10 appropriations bills that must be passed to keep the government operating after Sept. 30.

To be sure, legislation still pending in November when lawmakers adjourn can be picked up when the next session opens in January. But 2000 is a presidential election year, when politics are expected to be even more partisan.

Edward L. Yingling, chief lobbyist for the American Bankers Association, said he was "cautiously optimistic" about the industry's chances for accomplishing its agenda but warned that bankers will have to press for quick action.

"Stuff needs to get done this year or early next year because after that not much is going to move," he said.

Yet key lawmakers have warned that the industry's top priority, financial reform, could be delayed as House and Senate negotiators try to compromise on a host of complex disputes.

"I would hope this is a conference that will not go into next year," House Banking Committee Chairman Jim Leach said ominously in late July before Congress left for its summer recess. "But I give no assurances on timing ... Anything is possible."

Senate Banking Committee Chairman Phil Gramm has sounded similar warnings. The Texas Republican is the main wild card because he and the White House oppose each other on community reinvestment requirements for banks merging with insurance or securities firms and on powers for direct bank subsidiaries. Sen. Gramm has said he wants to get legislation enacted this year but not at any cost.

House and Senate leaders have been pressuring Federal Reserve Board Chairman Alan Greenspan and Treasury Secretary Lawrence H. Summers to compromise on powers for bank subsidiaries.

Treasury officials favor the House bill, which would let these subsidiaries underwrite securities and do merchant banking. The Senate bill confines similar powers to small banks, and Mr. Greenspan strongly advocates that they be conducted only in holding company units.

President Clinton has promised to veto the bill over the bank subsidiary powers issue as well as any weakening of the Community Reinvestment Act. Whether Sen. Gramm will back off his demands for a small-bank exemption and other limits on the CRA or can compromise with the President is unclear.

Consumer privacy protections in the reform legislation continue to stir controversy. The House bill would require financial institutions to let consumers block the transfer of their private information to third-party marketers, but Sen. Gramm has said privacy should be handled in separate legislation.

Lobbyists continue to clash over whether nonfinancial firms should be able to purchase unitary thrifts.

America's Community Bankers "strongly supports" a proposal that would permit such transactions provided the Federal Deposit Insurance Corp. and the Office of Thrift Supervision approve them, ACB government relations director Robert R. Davis said.

But Kenneth A. Guenther, executive vice president of the Independent Community Bankers of America, said his group will "strongly oppose" anything but a ban on the sale of unitaries to nonfinancial firms.

Despite all the conflicts, many observers believe congressional leaders need to pass reform legislation this fall to shake their "do-nothing" reputation.

"This Congress is having problems with passing any meaningful legislation," Mr. Guenther said. "Passing sweeping financial modernization legislation would be a feather in their cap."

Meanwhile, Senate Majority Leader Trent Lott is expected to bring the bankruptcy reform bill up for debate by next week. The House approved its version by a veto-proof margin of 313 to 108 in May, but sharp divisions exist over the Senate bill.

Backed by the White House, some key Democratic senators resist limits on Chapter 7 bankruptcy filings, seek to impose more disclosure and other consumer protection requirements on credit card companies, and complain that alimony and other payments could be affected.

Sens. Charles E. Grassley, R-Iowa, and Robert G. Torricelli, D-N.J., have been drafting a bipartisan compromise for months, but details remain scarce.

Banking lobbyists are concerned that opponents might try to attach minimum wage, privacy, or other unrelated amendments. Bankers are counting on enough support from Democratic leaders such as Sen.

Torricelli and Sen. Joe Biden of Delaware to prevent any delaying tactics from derailing the bill.

If the Senate approves the bill, it is unclear whether the financial services industry and House Republican leaders could persuade President Clinton to compromise. (First lady Hillary Rodham Clinton, a possible Senate candidate in New York, has heavily criticized the legislation.)

The banking lobby is also pushing hard for tax breaks.

The President has promised to veto the 10-year, nearly $800 billion Republican tax reduction bill, and a bipartisan effort to draft a less expensive package has begun.

Banking lobbyists disagree on the prospects for any pro-bank tax cuts getting enacted.

Mr. Yingling called them "unlikely" this year because a partisan stalemate is a high probability. If a watered-down tax bill is enacted, however, estate tax relief could be included as well as provisions to ease bank conversions to tax-favored S corporations.

Others are more optimistic. "The odds favor very major tax legislation in the fall," said Mr. Guenther, who thinks banks could get the S corporation changes, estate tax reductions, and increases on caps to individual retirement accounts and other savings plans.

The thrift industry is also confident that the low-income housing tax credit could be expanded by 40%, said Mr. Davis of America's Community Bankers.

Bankers are far more bullish about the prospects for another top priority: farm relief. The Senate approved a $7.6 billion aid package on Aug. 4, and Rep. Jo Ann H. Emerson, R-Mo., is expected to push a similar measure in House-Senate negotiations over the full agriculture spending bill.

The only hitch, said ICBA agriculture finance director Mark Scanlan, is if crop insurance legislation is attached and stirs controversy.

"This thing could move fairly quickly," Mr. Scanlan said. "Bankers really don't want to see this drag out."

Lawmakers have set aside other banking bills until financial reform gets resolved. For example, regulatory relief legislation has been put on hold, because some of its provisions are duplicated in the financial reform bill to induce banking industry support.

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