House prepares consideration of FSGG bill with reg. relief

June 21, 2016

The U.S. House Rules Committee will consider what amendments to the Financial Services and General Government (FSGG) Appropriations bill (H.R. 5485) will receive a vote when the House of Representatives reviews the bill, possibly as early as Wednesday. The bill includes a number of CUNA-advocated provisions.

The House Appropriations Committee passed H.R. 5485 on June 9 by a 30-17 vote.

The bill itself contains a number of CUNA-backed provisions, including:

  • Changing the leadership structure of the Consumer Financial Protection Bureau (CFPB) to a five-person board and placing the bureau under the appropriations process;
  • Requiring the CFPB to study the use of arbitration prior to issuing any new regulations. This would affect the bureau’s recent proposal on arbitration; and
  • Stopping the CFPB from proceeding with its short-term, small-dollar loan proposal until the bureau completes transparent research, and provides data and sound analysis to assure the rulemaking does not limit access to credit.

CUNA-advocated language included in the committee’s report includes:

  • Instructing the CFPB to “strongly consider the impact the Bureau’s rules have on small institutions, like community banks and credit unions.” The Dodd-Frank Act gave the CFPB the express authority in section 1022 to tailor its regulations to exempt ‘‘any class’’ of entity from individual rulemakings. However, the CFPB has rarely used this authority. The report instructs the CFPB to report to Congress within 120 days of the bill’s passage “on how it has used its authority under section 1022 in rulemakings to exempt certain classes, any plans to revisit previous rulemakings to more carefully tailor or grant exemptions to rules that have been especially burdensome, and the process for the Bureau to consider exemptions to community institutions in future rulemakings.” The inclusion of this language was the result of CUNA and League efforts promoting a letter to the CFPB on this issue. The letter, authored by Reps. Steve Stivers (R-Ohio) and Adam Schiff (D-Calif.), urged the CFPB to use its exemption authority to protect credit unions from unnecessary and burdensome regulations. The letter was signed by 329 Members of Congress.
  • Calling for the Federal Communications Commission (FCC) to revisit its Telephone Consumer Protection Act (TCPA) order and address technical questions that may be impossible for financial institutions to resolve. This includes adjusting the exemption for financial institutions to contact consumers so that it can actually be used, and urging the FCC to provide more flexibility to the requirements;
  • Supporting recent efforts, including the CUNA-backed bill (H.R. 1210), that would allow residential mortgages held in portfolio to be considered Qualified Mortgages for the purposes of the CFPB’s lending rules;
  • Directing the Government Accountability Office (GAO) to determine the impacts of the Foreign Account Tax Compliance Act (FATCA) on U.S. citizens living abroad. The GAO must also make recommendations on FATCA implementations, and both must be done within 180 days of enactment of the bill;
  • Directing the Office of Critical Infrastructure Protection and Compliance Policy to report to several congressional committees on ways to improve cybersecurity and an update on collaboration across the financial services sector within 60 days of the bill’s enactment; and
  • Calling for the CFPB to review its actions related to indirect auto lending, and urging the CFPB to support “fair lending protections for consumers” and to act “within the law established by Congress and believes that there are significant deficiencies in the Bureau’s statistical methodology and approach to enforcing the Equal Credit Opportunity Act with regard to indirect auto lending.”

The bill would also fund:

  • NCUA’s Community Development Revolving Loan Fund (CDRLF) at $2 million, the same amount as the Senate FSGG bill;
  • U.S. Treasury’s Community Development Financial Institutions (CDFI) Fund at $250 million, while the Senate FSGG bill would fund it at $234 million;
  • Small Business Administration’s (SBA) 7(a) program at $28.5 billion, while the Senate FSGG bill would fund it at $26.5 billion; and
  • SBA’s 504 loan program at $7.5 billion, same as the Senate FSGG bill.

On the other side of Congress, the Senate Appropriations Committee passed its FSGG bill last week, but it was largely devoid of policy riders. It would create a new account, the Cybersecurity Enhancement Account, designed to bolster the Treasury’s cybersecurity posture and mitigate threats to the U.S. financial infrastructure. The committee recommended $47,743,000 for the account.

It is unknown when the full Senate will consider its FSGG bill.