U.S. Sens. John McCain, R-Ariz.; Richard Shelby, R-Ala.; and Judd Gregg, R-N.H., have introduced an amendment to the financial bill that, if enacted, would place a two-year limit on the conservatorship of Fannie Mae and Freddie Mac.
If, at the end of the conservatorship, a government-sponsored enterprise (GSE) is considered less than financially viable, the Federal Housing Finance Agency would place the company in receivership and dissolve it. A financially viable GSE, on the other hand, would be allowed to re-enter the market, albeit under new operating restrictions.
The senators' amendment – dubbed the GSE Bailout Elimination and Taxpayer Protection Amendment – is in response to repeated Republican calls for financial reform legislation to address the GSEs.
 "Fannie Mae and Freddie Mac are synonymous with mismanagement and waste, and have become the face of "too big to fail,'" McCain said in a statement. "The time has come to end Fannie Mae and Freddie Mac's taxpayer-backed slush fund and require them to operate on a level playing field."
The amendment would also repeal the affordable-housing goals mandate for the GSEs post-conservatorship, require the companies to shrink their mortgage-asset portfolios, and rework conforming loan limits and minimum down-payment requirements.
While the companies remain in conservatorship, the federal funding limit of $200 billion per institution would be reinstated. The companies would also be included in the federal budget for as long as they are under conservatorship or receivership.
SOURCE: Office of Sen. John McCain