- The Washington Times - Monday, September 23, 2002

Last December, we introduced H.R. 3424, the Community Choice in Real Estate Act. We designed our bill to maintain a broad array of choices for American home buyers and home sellers. In just six months, nearly 260 members of the House and Senate representing diverse political, geographical and ideological backgrounds have joined us in supporting this important legislation.
We put forth the Community Choice in Real Estate Act in response to a regulatory proposal by the Treasury Department and the Federal Reserve Board. Some national banking entities had formally petitioned the regulators, requesting the power to own and operate local real estate brokerage and property management companies. The request came on the heels of congressional enactment of the historic Gramm-Leach-Bliley Act in 1999. That law broke down the barriers between the banking, securities and insurance sectors, but it retained a distinct firewall between banking and commerce.
Much has been said and written about the congressional intent embodied in the financial services modernization law, and whether the power extended to federal regulators to expand the list of permissible financial activities included the authority to permit federally chartered banks to own and operate local real-estate companies. The decision of more than 240 members of the House to back our bill reflects the reality that not only would such a policy not have passed the House in 1999, but also that it would not pass the House today.
We have joined together to send a clear message that real estate brokerage and property management are commercial business activities and not financial in nature. If Congress had intended to define real estate brokerage and property management as financial activities, we would have done so, and not left such a dramatic change to unelected federal regulators.
Recently, Treasury Secretary Paul O'Neill, in observing the high volume of comment letters and the sensitivity generated by this issue, consulted with Fed Chairman Alan Greenspan and decided to postpone a decision on the proposed rule until 2003. This came as good news to the hundreds of thousands of realtors across the nation and the neighborhoods they serve. We commend the Treasury Department for recognizing the great concern that this proposed expansion of banking powers has caused in our local communities and on Capitol Hill. In the end, however, this is an issue on which Congress should have the final word.
Because the new Congress must reorganize in January and start all legislative efforts anew, it is imperative that the Treasury Department wait until the beginning of the next fiscal year in October 2003 to make any decision on this controversial proposal. The new Congress would then have the opportunity to again carry out its responsibility on this matter.
Realizing the importance of this responsibility, the House has already acted on this very issue. As a compromise to immediately enacting our bill, the House Appropriations Committee, led by Anne Northup of Kentucky, included a provision in the legislation to fund the Treasury Department that would prohibit any rule-making on this contentious matter until October 2003. The bill passed the House overwhelmingly by a vote of 308-121.
Such important organizations as the National Association of Realtors, the National Association of Home Builders, the International Council of Shopping Centers, and other real-estate groups support our efforts. Probably even more compelling, however, is the strong backing of some of the nation's most respected consumer-protection organizations, including the Consumers' Union and the National Community Reinvestment Coalition. The latter group describes a potential outcome of national banks entering the real estate business as: "Our worst nightmare … leading to less choices for consumers."
Why? Because the current marketplace provides a broad array of choices for aspiring home buyers and home sellers. So, if the current system is not broken, then why rush into anything that would upset this well-balanced marketplace?
Millions of consumers and small businesses have lined up behind our efforts. It is now time for the Senate to do the right thing, and support these important consumer and market protections in the Treasury Appropriations bill.

Rep. Ken Calvert is a Republican from California. Rep. Paul E. Kanjorski is a Democrat from Pennsylvania.

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