U.S. Senate: Clock Ticking on Regulatory Relief

Dome of the U.S. Senate building.

Last week, 5,200 credit union advocates (325 from California and Nevada) converged on Washington D.C. for the Credit Union National Association’s (CUNA) annual Governmental Affairs Conference (GAC). The message credit unions brought to Congress was the need for commonsense regulation and the passage of S. 2155, the bipartisan framework for such a measure.

As of 11 a.m. (Pacific) the Senate began running the clock on its floor debate of S. 2155. Passing a measure from the Senate Floor is often more difficult than the House, as typically 60 votes are needed to overcome a procedural motion called the “filibuster.” With 60 votes, the debate can be limited to a certain amount of hours and ensure a vote on passage must commence when that debate period has ended.

“Once the clock starts on the debate, it simply comes down to the schedule,” said Jeremy Empol, vice president of federal government affairs for the California and Nevada Credit Union Leagues. “The Senate, unlike the House, is more free-flowing in its scheduling. It can start and stop debate as if the only clock that matters is the Senate’s clock. Thus, in theory, as there may only be 36 hours of debate, the vote could be sometime next week.” It is expected the opposition will use every minute to debate the final bill, he added.

Once passed, the bill would move to the House, where timing and consideration are pending.

The bill being debated, S. 2155, provides considerable regulatory relief for credit unions by enacting the following:

  • Section 101— Grants a safe harbor for credit unions that hold mortgages in their portfolio. These loans would be in compliance with the Consumer Financial Protection Bureau’s (CFPB) Qualified Mortgage.

  • Section 104—Raises the Home Mortgage Disclosure Act (HMDA) reporting requirements to 500 closed-end and open-end loans in a calendar year.

  • Section 105—Grants credit unions parity with banks over the treatment of non-owner-occupied residential mortgages for up to one-to-four unit dwellings, freeing space from the member-business lending cap.

  • Section 108—Requires the CFPB to issue a rule on underwriting standards for Property Assessed Clean Energy (PACE) loans, which currently do not exist.

  • Section 110—Removes the three-day waiting period for a credit union to extend a second offer for a mortgage rate if the rate is lower.

  • Section 213—Creates greater transparency for the National Credit Union Administration’s (NCUA) budgeting process.

  • Section 303—This is the Senior Safe Act, which protects credit union staff who report potential cases of elder financial abuse.

  • Section 501—Requires the Treasury Department to conduct a study on the risks of cyber-threats to financial institutions, which also includes merchant data breaches.