Credit unions scored critical wins Thursday in the House Appropriations Committee’s markup of the Financial Services and General Government (FSGG) Appropriations Act for Fiscal Year 2018.
The bill includes provisions that were in in H.R. 10, the Financial CHOICE Act, and offers credit unions significant regulatory relief. The measure brings the Consumer Financial Protection Bureau (CFPB) under the appropriations process and reforms CFPB’s Unfair, Deceptive, or Abusive Acts Authority, and includes other changes found in CHOICE that add more checks and balances to the CFPB rulemaking process.
The bill also restores full funding to the Community Development Revolving Loan Fund (CDRLF), which had been defunded in the initial draft. CDRLF assists credit unions serving low-income communities.
Rep. Jaime Herrera Beutler (R-Wash.) worked with Rep. Tom Graves (R-Ga.), chairman of the FSGG subcommittee, to include $2 million in the manager’s amendment' to fully restore funding to the CDRLF.
“CUNA, the leagues and credit unions thank Chairman Tom Graves and Rep. Jaime Herrera Beutler for their leadership in fully funding the Community Development Revolving Loan Fund,” said CUNA President/CEO Jim Nussle. “Ensuring this important program is funded helps stimulate economic development in low-income communities served by credit unions through improved access to financial services, opportunities for increased member savings and improved employment opportunities.”
Other relief provisions include the repeal of the CFPB Small Business Loan Data Collection program. It also repeals the CFPB’s authority to write rules for arbitration. In addition, the draft provides for community financial institution mortgage relief as well as safe harbor for certain loans held on portfolio.
The draft bill, however, includes several provisions of serious concern to credit unions. It puts federal banking regulators, including NCUA, under the appropriations process. CUNA opposes bringing the NCUA under the appropriations process as the money that funds NCUA comes solely from credit unions and their members.
During the markup, Rep. Mark Amodei (R-Nev.) introduced an amendment that would strike this provision in the bill. Amodei later withdrew the amendment after he announced that he, Graves and House Financial Services Committee Chairman Jeb Hensarling (R-Texas) had discussed how the NCUA and the National Credit Union Share Insurance Fund were different than banks and their Federal Deposit Insurance Fund.
Amodei said Graves and Hensarling were committed to “work hard” with him in the coming weeks to craft a compromise that would give Congress more oversight over the NCUA, while at the same time allowing the agency and the insurance fund to maintain its independence. CUNA will work with members of the Senate as the Senate Financial Services and General Government (FSGG) Appropriations Subcommittee are expected to markup its version of the bill in early September.
CUNA sent a letter Thursday to FSGG noting that a separate, independent federal regulator and insurer is critically important to the credit union system, and the structural and mission-driven differences between credit unions and banks necessitate such a regulatory scheme.