We’ll know as soon as this week whether Massachusetts Attorney General Martha Coakley was right to walk away from a national foreclosure settlement, or whether that decision will leave Bay State homeowners out in the cold.
The Wall Street Journal reported today that HUD Secretary Shaun Donovan and Iowa AG Tom Miller hope to complete negotiations on a national foreclosure settlement this week. The settlement would have the nation’s five largest mortgage servicers (Bank of America, Citigroup, JP Morgan Chase, Wells Fargo, and Ally Financial) pay some cash damages, and commit to lowering borrowers’ mortgages by cutting interest rates and making principal write-downs.
The value of the settlement would range between $19 billion and $25 billion, depending on whether California and Nevada join in. Delaware and New York have also been skeptical of a broad settlement.
Iowa’s Miller is leading the talks, which began a year ago, and were intended to cover all 50 states. The White House has strongly supported a settlement as a tool for strengthening the nation’s sagging housing market by lowering mortgage costs for struggling homeowners; its current mortgage refinancing programs have fallen far short of expectations. Banks like the settlement because it would cap their legal liability for improper foreclosures.
California and Massachusetts dropped out of the settlement talks in October, claiming that the settlement would trade too much bank immunity for too little homeowner relief. California and Nevada then launched a joint probe into foreclosure practices, while Coakley sued the five banks involved in the settlement talks.
It’s noteworthy that the foreclosure settlement trades relief for current borrowers for a liability release on past foreclosures. That’s an easy trade to make, but it leaves homeowners who have been foreclosed out of their homes out of the equation.
Massachusetts has seen nearly 50,000 foreclosures since the beginning of 2007. The only reason there’s a legal settlement on the table at all is because many of these foreclosures have been processed improperly. These foreclosures have created very real and very tricky problems with foreclosed properties, since banks have been reselling foreclosed homes they never had the title to. Coakley’s lawsuit zeroes in on homeowners who were wrongfully broomed out of their homes. We’ll see this week whether going it alone in court was really the only way to get the banks to focus on these cases.
–PAUL MCMORROW
BEACON HILL
Former House majority whip turned back-bencher Charley Murphy gives his version of events on his demotion to Emily Rooney.
The state Division of Insurance hits Progressive with a $125,000 fine for an inadvertent mistake, CommonWealth reports.
The Republican likes “Open Checkbook,” the new state spending database.
CASINOS
The campaign is on, as casino mogul Steve Wynn starts dangling goodies in front of the good people of Foxborough. In an open letter to the town, he says casinos are “not our business.” Instead, Wynn argues, gaming floors are the cost of getting to build the fancy restaurants and spas he really cares about. The mere mention of Wynn’s name draws crowds big enough to force the Foxborough selectmen’s meeting out of town hall.
A protracted legal battle in Washington shows that the path to a tribal casino in southeastern Massachusetts won’t be as smooth as Beacon Hill hopes it’ll be.
MUNICIPAL MATTERS
All did not go perfectly swimmingly yesterday with the Boston City Council’s effort to ram through the appointment of just-barely-former city councilor Maureen Feeney to be the next city clerk.
A decision to string Christmas lights on a memorial tree dedicated to a local Medal of Honor recipient has caused a stir in Middleborough over who has say over Veterans Park on town property.
Leaders of Pembroke’s town unions are criticizing the proposal to reduce health care costs by joining the state’s Group Insurance Commission or design a similar plan.
The city manager in Lowell says he hopes to reach an agreement on health care costs with the city’s union, but if that effort fails he will seek new powers under the state’s health care reform law, the Lowell Sun reports.
Gloucester approves a $3,700 a year tax break for Gorton’s, which will pave the way for additional tax relief from the state, the Gloucester Times reports.
Boston Mayor Tom Menino is pushing the idea of tiny “micro-unit” apartments in the waterfront Innovation District, the Globe reports. Don’t think about bringing your sectional sofa.
Lynn pursues $200,000 it says it is owed for busing homeless students placed by the state in Danvers back to their home schools in the city, the Item reports.
Mr. Morse goes to Washington: President Obama invites Holyoke Mayor-elect Alex Morse to the White House holiday party.
Go big: Skateboarders and city officials like Pittsfield’s new skateboard park.
OCCUPY
Margery Eagan rouses the rabble: “Lots of you apparently prefer getting fleeced to fighting the fleecers. You are gullible, beaten down, sad sacks. You have my sympathy. But lots of us prefer any American — Mohawked, braided, dirty, smelly, slightly or utterly batty — who’s not afraid to tell these greedy Wall Street thieves and their government enablers to go straight to hell. Occupy today. Occupy tomorrow. Occupy for as long as it takes.”
ELECTION 2012
State Rep. Tom Conroy withdraws from the US Senate Democratic primary and endorses Elizabeth Warren, WBUR reports.
US Rep. Stephen Lynch is making the rounds in his new district, attending a football game in Quincy with Mayor Tom Koch, coffee with Weymouth Mayor Sue Kay and hitting a selectmen’s meeting in Cohasset. Rep. William Keating, who is losing those towns, took a tour of Fall River and met with public safety officials in the city that will become part of the new 9th District he will move to.
Meet the new Newt, same as the old Newt. And in one of the worst possible slights one conservative could lay on another, the Weekly Standard’s Fred Barnes says Gingrich is channeling the late Ted Kennedy in his attacks on Mitt Romney. It was rumble of the rich guys yesterday, as Romney and Gingrich took shots at each other’s 1 percent membership. And Romney had quite the New Hampshire diner surprise as he sidled up in a booth to a 60-something-year-old, flannel-shirt clad, Vietnam Veteran hat wearin’ fella, who promptly grilled the candidate on his stance on gay marriage and asked him why his same-sex partner shouldn’t be entitled to standard spousal benefits after he served his country honorably in the military. Iowa evangelicals haven’t lined up behind a single candidate, and the state may now hinge on Ron Paul.
President Obama’s campaign operatives are feeling less “suicidal” about his chances. That could be because the Republicans aren’t winning over too many voters by not offering alternatives to their “just say no” response to the president’s programs.
“Boring enough to induce narcolepsy in a chronic insomniac.” That’s the verdict on the Newt Gingrich-Jon Huntsman debate.
What happens if the Republicans take the Senate? Talking Points Memo looks at the how the math could add up for the GOP.
BUSINESS/ECONOMY
New Bedford small businesses are asking the City Council to ease the commercial tax rate, which is higher than residential, to give some relief to businesses still reeling from the faltering economy.
The Republican says new construction projects mean things are looking up in Western Massachusetts. Meanwhile, The Berkshire Eagle sees a projected increase in Berkshires tourism as a good sign.
The Wall Street Journal gives Ben Bernanke a grade of “incomplete.”
Former Washington Mutual execs settle an FDIC lawsuit for $75 million — far less than the $900 million the feds originally sought.
Casino money is causing Indian tribes in California to turn on one another, as gambling tribes eject members with mixed bloodlines.
EDUCATION
Jack Wilson has given up the reins as president of the University of Massachusetts — but not the gold-plated salary.
A Boston University instructor resigns after CommonWealth’s report that he tried to hire someone to help grade student papers.
Pulitzer Prize-winning author Isabel Wilkerson apparently collected her semester’s pay at Boston University but failed to show for the newswriting course she was supposed to teach because she was promoting her new book, The Daily Free Press reports. Via Universal Hub.
Over 1,000 teachers, parents, and students in Lawrence turned out to listen to Mitchell Chester, the state’s commissioner of elementary and second education, who is about to appoint a receiver for the city’s school system, the Eagle-Tribune reports.
Following a national trend, Georgia plans to require its ninth graders to pick a career path and follow a class schedule that’s at least partially tailored to it, the Atlanta Journal-Constitution reports. Meanwhile, a new study finds that two-fifths of high school students aren’t ready for college or the workforce.
TRANSPORTATION
More flights than usual got stranded on tarmacs in October, largely because of the Halloween weekend snowstorm, according to the US Department of Transportation.
ENERGY/ENVIRONMENT
Canada pulls out of Kyoto protocol, Reuters reports.
CRIMINAL JUSTICE
A Superior Court judge continues the EMT fraud case of the former Hamilton police chief without a finding, allowing the ex-cop to avoid a criminal record and save his pension, the Salem News reports.
Joseph Lally, the star government witness who testified against former House Speaker Sal DiMasi, says he expected DiMasi and lobbyist Richard McDonough to plead out as well. Lally reported to Devens yesterday and began serving an 18 month sentence for conspiracy and fraud.