New budget could aid state

WASHINGTON -- The 2010 federal budget blueprint that is being formed this week in the Senate will contain a nod to Nevada and other states battered by the mortgage crisis, according to Sen. Harry Reid.

Reid, D-Nev., said Wednesday that it will have a technical provision making it easier for Congress to take up housing assistance bills later this year.

The so-called "placeholder" language makes room in the budget for the cost of the housing bills, assuming they are offset by other cuts so as not to increase the deficit. Otherwise, those bills could be vulnerable to procedural challenges.

Among possible housing strategies, the House has passed a bill that would allow federal judges to modify the terms of troubled mortgages in bankruptcy proceedings, although that bill has been stalled in the Senate.

Reid also has mentioned bills that would provide "safe harbor" for loan servicers to renegotiate mortgages without fear of getting sued by investors who own the loans.

Reid earlier this week asked Sen. Kent Conrad, D-N.D., the chairman of the Senate Budget Committee, for special consideration of housing as Nevada leads the nation in foreclosures.

On Wednesday, Reid said Conrad "recognized that some states have been hit harder than others" in the economic downturn.

"Nevada has been hit real hard," Reid said.

In making his request to Conrad on Monday, Reid said President Barack Obama's program to help homeowners renegotiate troubled mortgages does not go far enough to help in Nevada, where a substantial number of home loans are in too much trouble to qualify.

Contact Stephens Washington Bureau Chief Steve Tetreault at stetreault@ stephensmedia.com or 202-783-1760.