Bipartisan, bicameral housing deal emerges with bank riders

• Key insight: House Financial Services Committee Chairman French Hill, R-Ark., dropped his objections to another version of the bill, clearing a major hurdle for Senate lawmakers. 
• Forward look: The bill will receive a procedural vote this evening, but final passage will mean finding more time on the busy Senate calendar. 
• What's at stake: The housing bill most notably includes a number of community bank provisions, including ones on custodial and brokered deposits.

WASHINGTON — Party leaders on the Senate Banking Committee and House Financial Services Committee have, together, put forward a housing bill compromise that includes some of community banks' legislative wishlist items. 

The community bank provisions have slipped in and out of various iterations of the housing bill in the last few months, with the House generally supporting their inclusion, while some Senate Democrats have opposed them. 

In general, the housing bill aims to increase the availability of funds for local housing building. But most important for bankers is the inclusion of bills that will make it easier for them to engage in brokered and custodial deposits, as well as one that would double the asset threshold to $6 billion for banks to qualify for the longer 18-month examination cycle and one that would make it easier for de novo banks to form. 

It also includes a controversial institutional ownership ban for single family homes, although one that's been watered down through the various versions of the package. 

This package is the first that is both bicameral and bipartisan. All four leading bank lawmakers have signed off on it: Sens. Tim Scott, R-S.C., and Elizabeth Warren, D-Mass., on the Senate Banking Committee, and Reps. French Hill, R-Ark., and Maxine Waters, D-Calif., on the House Financial Services Committee.

It follows an earlier hiccup this week, according to three people familiar with the matter, when Scott and Warren floated a similar proposal that Hill didn't quite fully back. Since then, the lawmakers added a three-year sunset clause on the Community Development Block Grant Disaster Recovery program, while the Senate originally wanted to permanently fund it. 

"I appreciate the Senate including a three-year sunset on the CDBG-DR program and adopting key House priorities including 9 community banking bills and the House's language limiting institutional investors from outcompeting American families in the housing market," Hill said in a statement. 

The four lawmakers' support means that the legislative package has a much cleaner path to passage than it did previously, although it still has to find time on the busy Senate floor. The House passed its version of the housing legislation last month in a 396 to 13 vote. The bicameral compromise will undergo a procedural vote in the Senate this evening.