WASHINGTON – Almost as soon as the Senate took up a bipartisan $300-billion deal today to pull the U.S. housing industry out of its downward plunge, obstacles to its passage appeared, including a veto threat from the White House.

That threat was based in part on the administration's opposition to Rhode Island Sen. Jack Reed’s mechanism to pay for the rescue of the damaged mortgage system. The long-awaited package would overhaul rules governing Fannie Mae and Freddie Mac, the huge institutions that control a large portion off the nation’s home-buying credit, and help hundreds of thousands of home owners refinance their troubled mortgages.

The financing mechanism is "problematic and needlessly complex,’’ the executive office of the President advised senators in a "statement of administration policy’’ issued several hours after debate began on the package.

The administration also opposed the permanent trust fund that Reed’s provision would create to pump billions of dollars into housing for poor people. Fees on the industry would create a fund which, at first, would direct most of its income to the rescue of mortgages. But over several years, the rescue function would be phased out and the fund would exist solely to increase the supply of housing for lower-income Americans.

Reed noted that the overall bill won easy bipartisan support in the Senate banking committee several weeks ago because it addressed Republican – and White House – opposition to bailing out bad mortgages with taxpayer funds. In singling out the private-sector fee structure as possible grounds for a veto, Reed said, "I think what they’re saying is they don’t want an affordable housing trust fund.’’

Sen. Charles Schumer, D-NY, joined Reed at a press conference to express puzzlement that the White House would threaten to veto a bill that includes much of what Republicans have demanded, such as mortgage industry rules reform, while attempting to ease a national economic crisis.

"What Jack Reed is trying to provide here is decency, common decency,’’ Sen. Christopher J. Dodd, D-Conn., banking committee chairman, said during the floor debate on the bill.

But Dodd’s links to Countrywide Financial -- one of the biggest institutions caught up in the mortgage crisis – have aroused Republican demands that potential conflicts of interest be examined before Senate votes on the rescue package.

Reed stressed the urgency of the problems that the mortgage crisis has brought to neighborhoods in Rhode Island and around the country. "When delinquent mortgages are foreclosed, houses are boarded up, property values go down,’’ Reed said. "And very quickly, there goes the copper piping, there goes the siding’’ and the saleability of the homes falls further.

-- John E. Mulligan, Journal Washington Bureau