WASHINGTON -- A new effort by Rep. Stephen L. Neal, D-N.C., to jump-start the stalled Resolution Trust Corp. funding bill is unlikely to succeed before Congress goes on a monthlong break.
Hoping to woo the 30 or so Republicans who House leaders believe will be necessary to pass the measure, Rep. Neal proposed dropping money for the Savings Association Insurance Fund from the bill.
In return, the federal government would pick up a $772 million annual tab for the $10.8 billion in bonds sold in 1987 to finance an effort to shore up the thrift industry's insurance fund.
With that obligation extinguished, the industry's premium dollars could be devoted to building up the insurance fund.
Waiting for Deficit Vote
Rep. Richard Baker, R-La., who has been negotiating with Rep. Neal, agreed to float the idea past other Republicans, according to an aide to the lawmaker. But with the lone exception of Rep. Richard Dreier of California, Republicans working on the bailout package appear to have rejected the idea.
In addition, House Democratic leaders told Rep. Neal this week that they did not want to bring the bill up before the chamber finished work on President Clinton's controversial deficit reduction package. That vote is scheduled for today, and House members are likely to begin leaving town soon.
Floor Action Delayed
The House Banking Committee approved legislation that would make $18.3 billion available for the RTC and would give up to $16 billion to the insurance fund.
The Senate passed similar legislation, but floor action has been delayed in the House to give Rep. Neal and others time to muster a majority.
Supporters believe they have 190 Democratic votes for the package, and would like to add at least 30 Republicans -- not just to ensure the 218 votes required for passage, but also to give Democrats some political cover on the controversial issue.
Little Incentive for GOP
But as they have lost control of the White House, Republicans have little incentive to support the package, and many have gone on the attack.
Rep. Toby Roth, R-Wis., circulated a "Dear Colleague" letter in recent weeks arguing that -- among other resources -- the RTC has $7 billion in unspent cash that could be used.
Rep. Roth quoted from a letter in which L. William Seidman, the former RTC chairman, said it "would be reasonable to fund remaining and future thrift resolutions by allowing the RTC to borrow from the Treasury against the approximately $100 billion of assets currently held by the agency."
"There is absolutely no justification for appropriating or reappropriating any more federal taxpayer funds for the $&L bailout at this time," Rep. Roth said.
Rep. Neal, who is chairman of the House Banking subcommittee on financial institutions, is expected to be the floor manager for the bill. he has said that if Congress fails to provide the funding, public confidence in insured institutions will be diminished.