$300 Billion Housing Rescue Plan's Momentum Slows in Senate

Although more than half of the Senate favors a $300 billion bill to stanch the flow of home foreclosures — passing a key test vote this week with flying colors — the likelihood of it quickly becoming law is diminishing because of a seemingly unrelated matter.

A Senate leadership aide told FOX News on Wednesday that it is possible the mortgage bill will not be complete this week, meaning the bill would be put on hold at least until after the one-week July Fourth recess and dangerously close the month long August recess.

But Senate Majority Leader Harry Reid, D-Nev., vowed his chamber will complete the bill, even if he has to postpone the Senate's vacation.

The problem lies in an energy proposal from Reid's home-state colleague, Republican Sen. John Ensign, and Sen. Maria Cantwell, D-Wash. Their amendment would extend renewable energy tax credits for one year, costing the federal government $19 billion. None of this cost is offset by spending cuts or tax increases, so House Democrats led by the fiscally conservative Democratic Blue Dog coalition have soured on the measure.

The 48-member moderate Democratic group warned Reid in a letter that the housing bill has no chance in their chamber if the tax extender package is included with no bill-paying offsets. House Speaker Nancy Pelosi needs the Blue Dogs on most votes on her side of the Capitol, where Democrats outnumber Republicans by only a slim margin.

In a sit-down with reporters on Wednesday, Dick Durbin — the No. 2 Senate Democrat — criticized Ensign for what he said was efforts to block the housing bill.

"Senator Ensign has decided that he wants to bring in a matter that has nothing to do with housing and is threatening this housing bill," Durbin said. "It is curious that Senator Ensign would be raising this issue being from the state of Nevada where the value of homes has gone down some 27 percent and there are record number of foreclosures.

"One out of every 96 households in Las Vegas is in foreclosure at this point. There are over 9,000 properties across the state in foreclosure. It has had the highest foreclosure rate in the nation for 19 consecutive months, and yet Senator Ensign is holding up the housing bill," Durbin continued.

But Ensign aide Tory Mazzola said the Ensign-Cantwell energy amendment isn't out of the blue, and rather has everything to do with the current bill on the floor. That's because the housing bill sent to the Senate has three parts, and one includes an energy tax package. Ensign's amendment has been ruled "germane," or relevant, by the Senate parliamentarian.

There seems to be no endgame in sight at the moment even though intense pressure is on all sides to get a bill out on housing.

Republicans, several aides said, feel they are on safe political ground.

"We want to have this housing bill. We also support renewable energy. This [Ensign-Cantwell] bill has passed before, 88-8, and it wasn't paid for. We can all walk away from this winners. Reid just has to allow the vote," said one senior Senate GOP leadership aide, referring to a vote earlier this year by the Senate that overwhelmingly approved the energy tax bill.