The Coalition to Insure Against Terrorism (CIAT) submitted a letter this week to the House Financial Services Housing and Insurance Subcommittee ahead of its Sept. 17 hearing on “The Reauthorization of the Terrorism Risk Insurance Act of 2002 (TRIA).” The letter urged lawmakers to act well in advance of TRIA’s scheduled expiration on Dec. 31, 2027. (Letter, Sept. 15 | Watch Hearing)

Why It Matters

• TRIA has been reauthorized four times—in 2005, 2007, 2015, and 2019—and is set to expire in 2027.

• The coalition letter warned that letting the program lapse would trigger “a period of profound economic slowdown, posing a very real threat to our economic and homeland security.” (Letter, Sept. 15)

• House Financial Services Housing and Insurance Subcommittee Chair Mike Flood (R-NE) said Wednesday he intends to propose a clean, eight-year reauthorization of TRIA. (PoliticoPro, Sept. 17 | Press Release, Sept. 17)

• Without TRIA, businesses from real estate and banking to hospitality and sports, could face significant financing challenges if terrorism insurance becomes unavailable or unaffordable. (Letter, Sept. 15)

• The program has never been triggered, but for nearly two decades has provided the commercial real estate industry with a crucial backstop against losses from external threats.

• An RER survey cited in the letter found that more than $15 billion in property transactions stalled or were cancelled in the 14 months between 9/11 and TRIA’s passage, underscoring the economic damage caused by the absence of terrorism insurance.

Hearing Highlights

• Members of the committee stressed the need to reauthorize TRIA, highlighting its role in sustaining a functioning insurance market and protecting the broader economy.

• “TRIA’s value is not just in direct responses to terrorism events. The program makes it easier to have an operating market where entities can purchase insurance that covers terrorism risk, and a well-functioning insurance market makes it possible for entities of all kinds to purchase insurance against terrorism risks,” Subcommittee Chair Flood said.

• House Financial Services Committee Chairman French Hill (R-AR) said, “It’s crucial we take the necessary steps to reauthorize TRIA in addition to enhancing the program’s operations to better protect our economy and strengthen our national security.” (Press Release, Sept. 17)

• During the hearing, Rep. Ritchie Torres (D-NY) underscored the stakes, stating that without TRIA there would be no financing—or far less financing—of projects. “Without TRIA, there would be no operational terrorism risk insurance market, and without TRIA, few businesses in America could survive a catastrophic terrorist event,” Rep. Torres said. (Watch Hearing)

• Michelle Sartain (Marsh McLennan), testified during the hearing that TRIA “has been a model public-private partnership,” remains essential for insuring against catastrophic risks, and warned that uncertainty around reauthorization would ripple through the economy, affecting hiring and investment. (Insurance Journal, Sept. 17)

Background on TRIA

• Enacted in November 2002, TRIA was created in the wake of 9/11 to stabilize insurance markets after private insurers began excluding terrorism coverage from policies.

• The program provides a system of shared public and private compensation for certain insured losses from a certified act of terrorism.

• TRIA operates at virtually no cost to taxpayers, thanks to its recoupment mechanism, and continues to ensure market stability amid persistent threats.

RER’s Advocacy

• Since 9/11, RER has been at the forefront of efforts to secure terrorism risk coverage for American businesses.

• RER launched its Homeland Security Task Force (HSTF) and the Real Estate Information Sharing and Analysis Center (RE-ISAC) to coordinate CRE’s response to physical and cyber threats.

• RER also helped establish CIAT, a broad coalition of commercial insurance consumers formed immediately after 9/11 to ensure that businesses could obtain comprehensive and affordable terrorism insurance. (CIAT Talking Points on TRIA Reauthorization)

RER will continue to work with CIAT and policymakers to ensure a long-term reauthorization of TRIA before its scheduled expiration in 2027.

Senate Finance Committee Ranking Member Ron Wyden (D-OR) introduced the bicameral Billionaires Income Tax Act this week with support from 20 Senate Democrats. The legislation mirrors the version first introduced by Sen. Wyden in 2023, and would tax the appreciation of wealthy individuals’ assets. Identical legislation was introduced in the House by Reps. Donald Beyer (D-VA) and Steve Cohen (D-TN). (PoliticoPro, Sept. 17)

Billionaires Income Tax Act (BITA)

• Under BITA, tradable, liquid assets would be marked-to-market and taxed annually on their appreciation, while illiquid assets would be subject to a “deferral recapture” tax when sold—or if certain other currently nontaxable events occur, such as death, a transfer to a trust, or a like-kind exchange. (Bill text | Press release | One-pager, Sept. 17)

• The bill would apply to taxpayers with more than $100 million in annual income or more than $1 billion in assets for at least three consecutive years. (PoliticoPro, Sept. 17)

• The legislation is not limited to future appreciation of assets. It would also apply to accumulated, unrealized gains at the time of enactment. Tax on these built-in gains could be paid over five years.

• Additional rules would govern unrealized losses, as well as assets held in partnerships.

Roundtable View      

• Real Estate Roundtable (RER) President and CEO Jeffrey DeBoer said: “Taxing unrealized gains would upend over 100 years of federal taxation, require an unprecedented IRS intrusion into household finances, and create harmful unintended consequences. Deferring taxes until assets are sold supports entrepreneurs while encouraging long-term investment and productive risk-taking. This proposal lacks broad policy support, carries considerable risk, and should be rejected.”

• Past attempts at wealth taxes in other countries have also collapsed—largely abandoned due to administrative problems, lack of public support, and minimal impact on income distribution (Roundtable Weekly, 2023)

Roundtable Spotlight

• At the American College of Real Estate Lawyers (ACREL) Annual Meeting this week, RER’s Ryan McCormick (SVP & Counsel) and DeBoer highlighted how the One Big Beautiful Bill (OB3) Act supports jobs, economic growth, investment, and avoids harmful tax changes. They also discussed the nation’s housing shortage and the future of Fannie Mae and Freddie Mac.

• Longtime and revered RER President’s Council member Jay Epstien received the Fred Lane Award for his lifetime of contributions to the real estate legal profession at the ACREL meeting.

McCormick was also a featured speaker on the Engineered Tax Services webinar this week to discuss the OB3 Act and its wide-ranging implications for commercial real estate, including permanent extensions of 100 percent expensing, Opportunity Zone incentives, affordable housing credits, and other key provisions. (Watch ETS Webinar)

Senate Democrats on Friday blocked a House-passed stopgap spending bill that would have funded federal agencies for seven weeks, setting the stage for a potential Oct. 1 government shutdown.

• The measure failed on a 44-48 vote, with only Sen. John Fetterman (D-PA) joining Republicans in support of the proposal, which had cleared the House earlier in the day by a narrow 217-212 vote. (The Hill, Sept. 19)

• Senate Majority Leader John Thune (R-S.D.) said the Senate will reconsider the vote when lawmakers return from recess. (Roll Call, Sept. 19)

• Earlier in the week, House Republicans introduced their continuing resolution (CR) to keep federal agencies open through Nov. 21, while Democrats countered with a plan extending funding only until Oct. 31. (Punchbowl News, Sept. 18)

• Lawmakers may not return until Sept. 29, leaving less than 48 hours to avert a shutdown. (Punchbowl News | PoliticoPro, Sept. 19)

Government Funding & CRE

• The House GOP bill would also extend the National Flood Insurance Program (NFIP) until Nov. 21. Without congressional action, the NFIP will expire on Sept. 30. If approved, the House GOP’s proposal would mark the NFIP’s 34th short-term extension in eight years.

• Lawmakers from both parties have long called for an overhaul, and signaled interest in pursuing longer-term reforms to the program.

• Policymakers in both chambers have signaled interest in pursuing longer-term reforms to NFIP. Chair of the Senate Banking Securities, Insurance and Investment Subcommittee, Mike Rounds (R-SD) said he expects “some reforms that can occur” this fall to put the program on a stronger financial footing. (PoliticoPro, Sept. 18)

• The rising cost of insurance premiums due to the growing number of billion-dollar natural disasters reinforces the importance of the NFIP.

• The Real Estate Roundtable (RER) has long supported a sustainable, long-term NFIP reauthorization with appropriate reforms. A robust program is essential for residential markets, catastrophe insurance capacity, and the broader economy.

• The funding bill would also allow the Department of Housing and Urban Development (HUD) to use available funds to prevent evictions of households served by the Tenant-Based Rental Assistance program. (PoliticoPro, Sept. 17)

RER Town Hall

• RER hosted a virtual Town Hall this week, “How Today’s Political Climate Impacts Real Estate,” with Politico’s Jonathan Martin (Politics Bureau Chief and Senior Political Columnist)

• The discussion was led by RER Chair Kathleen McCarthy (Global Co-Head of Blackstone Real Estate), RER President and CEO Jeffrey DeBoer, and RER policy staff.

• Martin shared his outlook on the 2026 and 2028 elections, the messaging challenges facing both parties, and shifting party identities.

• He cautioned that a short-term government shutdown remains “more likely than not” as both parties seek leverage over Medicaid cuts and health care tax credits.

RER members also engaged in policy discussions on a number of policy priorities, including the implementation of the OB3 Act, Section 899 “revenge tax” concerns, Opportunity Zones, clean energy tax incentives, housing finance reform, and the future of TRIA.

On Wednesday, the Federal Reserve reduced its benchmark interest rate by 25 basis points, marking the first rate cut since December 2024. Central bank officials also projected two additional rate reductions this year, citing growing concerns about labor market softening and economic headwinds.

Fed’s Decision

• The Fed’s move brings its target federal funds rate to a range of 4 percent to 4.25 percent, aligning with expectations on Wall Street. (CNBC, Sept. 17)

• Fed Chair Jerome Powell emphasized that while inflation remains above the 2 percent target, rising signs of labor market weakness justify a more accommodative stance.

• Governor Stephen Miran, confirmed to the Fed Board on Monday, cast the lone dissent in favor of a steeper half-point cut.

• The central bank’s latest projections signal two more rate cuts before year-end, though the “dot plot” of officials’ individual expectations varied considerably.

Housing Impact

• Mortgage rates have responded quickly to the Fed’s decision, falling to 6.17 percent as of Thursday—the lowest level in nearly a year. (Fortune, Sept. 18)

• However, mortgage rates remain elevated compared to pre-pandemic levels, leaving many prospective homebuyers priced out. Home values remain roughly 50 percent higher than at the start of the decade. (AP News, Sept. 18)

• Chair Powell acknowledged that monetary policy alone cannot solve the nation’s housing affordability crisis. “There’s a deeper problem here, that’s not a cyclical problem that the Fed can address, and that is just a pretty much nationwide housing shortage,” he said. (CNN, Sept. 17)

• The Real Estate Roundtable (RER) continues to advocate for bipartisan solutions that increase housing supply and reduce regulatory barriers to new development, such as the Road to Housing Act (S. 2651) and the Revitalizing Downtowns and Main Streets Act (H.R. 2410).

Implications for CRE

• The Fed’s rate cut comes soon after the release of RER’s Q3 2025 Sentiment Index, which reflected cautious optimism among CRE executives. The Index rose 13 points from last quarter to a score of 67, as signs of stabilization and sector-specific growth have started to emerge. (Roundtable Weekly, Sept. 5)

• Interest rate cuts could provide a modest tailwind for CRE markets, although some property types remain under pressure.

• Further reductions in borrowing costs into 2026 could support more robust valuations and transaction activity. (Multifamily Dive, Sept. 17)

• At the 2025 C5 + CCIM Global Summit in Chicago this week, RER President & CEO Jeffrey DeBoer joined Shannon McGahn (Executive Vice President and Chief Advocacy Officer, National Association of REALTORS®) and Jef Conn (Industrial & Office Specialist, Coldwell Banker Commercial Capital Advisors) on a panel to discuss the bipartisan nature of the nation’s affordable housing crisis.

• DeBoer emphasized the need for a construction visa program to expand the labor force and build more supply, along with policies such as YIMBY legislation, property conversion incentives, and permitting reforms to help address the crisis.

The Fed’s next rate decision is scheduled for Oct. 29, with the final FOMC meeting of the year set in early December.