Congress continues to look at avenues for financial reform (and that’s in addition to the U.S. Senate’s review of tax reform from this week), something of interest to credit unions. There have been multiple bills introduced and hearings held, some as recent as yesterday. And with any legislation, the devil is truly in the details; bills that provide sweeping changes often have unintended consequences that could create negative impacts. As such, it is important to have strong relationships with legislators – and to ensure that they know what is important to credit unions and the members they serve. An excellent example of how credit union efforts had a positive impact was seen in the evening hours of July 13th, when credit unions scored critical wins and advanced several priorities in the House Appropriations Committee’s markup of the Financial Services and General Government (FSGG) Appropriations Act for Fiscal Year 2018. The bill includes several provisions that were included in H.R. 10, the Financial CHOICE Act. It would:
- provide significant regulatory relief and bring the CFPB under the appropriations process,
- reform the CFPB’s UDAAP authority,
- add more checks and balances to the CFPB rulemaking process,
- repeal the CFPB Small Business Loan Data Collection program,
- repeal the CFPB’s authority to write rules for arbitration, and
- provide for community financial institution mortgage relief as well as “safe harbor” for certain loans held on portfolio.
Also in the bill is a provision to bring NCUA under the appropriations process, and while that could be positive from some aspects, it is important for that potential action not to homogenize credit unions (or dilute the NCUSIF funds). During the hearing it was expressed that two committee members, FSGG Chairman Tom Graves (R-GA) as well as House Financial Services Committee Chairman Jeb Hensarling (R-TX), had been in talks about how NCUA and the NCUSIF were different from banks and their Deposit Insurance Fund. Georgia credit unions have been engaged with Rep. Graves from an early point in his days in the state Legislature before becoming a member of Congress, and have consistently worked with him and his staff to ensure he has a firm understanding of what’s important to the industry, how it is unique, and its unique needs.
Chairman Graves and Hensarling have publicly committed 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 their independence. Credit unions, GCUA and CUNA will continue to work with Chairman Graves as the bill moves to the floor, and CUNA is working with senators as the Senate Financial Services and General Government (FSGG) Appropriations Subcommittee is expected to mark up its version of the bill in early September. This was significant progress that positioned credit unions well to achieve additional victories at the end of the process; thank you to all the credit unions who have met with Rep. Graves over the years – your time had a high ROI!
