The Atlanta Journal-Constitution
How motgage industry got relief from shutdown By Lisa Rein and Jeff Stein
After an intense lobbying campaign by the mortgage industry, the Treasury Department last week restarted a program that had been sidelined by the partial government shutdown, allowing hundreds of Internal Revenue Service clerks to collect paychecks as they process forms vital to the lending industry.
The intervention has raised questions about the Trump administration’s efforts to bring certain government functions back online to contain the shutdown’s impacts.
What happened?
Because of the shutdown, the IRS was unable to process a key form that lenders use to confirm borrowers’ incomes before they can grant home loans — a roadblock that threatened to bring the mortgage industry to a halt.
How did the mortgage industry respond?
The effort to restart the processing of those transcripts came after direct appeals by the trade association that represents credit reporting companies and top mortgage industry officials. The lobbying was led by Robert Broeksmit, chief executive of the Mortgage Bankers Association, who took the matter to Craig Phillips, senior adviser to Treasury Secretary Steven Mnuchin.
“I said, ‘Look, this is starting to be a problem for the lending industry,’ ” Broeksmit said. His group, one of the most influential trade associations in Washington, represents 2,300 mortgage companies, brokers, commercial banks and other financial institutions.
Broeksmit said he asked whether the IRS clerks could come back to work, saying: “Could you make these guys essential?”
What was the result?
The answer came the next day, Broeksmit said: The IRS employees would be called back to work.
After hearing concerns that the program had gone dark, top Treasury officials called senior officials at the White House Office and Management and Budget to consult on a solution, according to people familiar with the discussions.
On Monday, 400 furloughed IRS clerks in Fresno, California; Cincinnati; Kansas City, Missouri; and Ogden, Utah, were back on the job, according to employees and union officials.
“I’d like to take some credit,” Broeksmit said, adding: “Our direct request got quite rapid results.”
Phillips, Mnuchin’s adviser, was among the officials who heard the concerns of the mortgage industry directly, but he said in an email, “This action was not taken to benefit the industry. It benefits the consumers that have made loan applications.”