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Just a day after the Dodd-Frank Act's fifth anniversary, Senate Banking Committee Chairman Richard Shelby launched a new attempt to make significant changes to the law, attaching his regulatory relief bill to legislation that would provide funding for financial services agencies.
July 22 -
With the release of Sen. Shelby's regulatory reform bill, the debate over the legislation is just beginning to take shape. We sort through the possibilities for how it will unfold.
May 12
WASHINGTON Republicans successfully moved sweeping regulatory relief legislation Thursday as part of the Senate appropriations process, moving it one step closer to avoiding Democratic objections.
The Senate Appropriations Committee approved a funding bill that includes the entire text of the regulatory relief bill authored by Sen. Richard Shelby, R-Ala. The legislation would ease the regulatory burden on small banks while making other changes to the Dodd-Frank Act.
The move is a gambit by Shelby, the chairman of the Senate Banking Committee who also sits on appropriations panel, in trying to force Democrats opposed to some of his regulatory relief changes to cut a deal. The bill passed the Banking Committee in May without Democratic support. In its current form, the reform bill lacks enough support to make it to the full Senate. But Shelby hopes that by adding it to spending legislation for several government agencies, it will be harder for Democrats to stop its advance.
"We will have two trains running here," Shelby said during the Appropriations Committee discussion of the legislation. "This will show we are serious about this. Maybe we are going to have some compromises come forth."
Democrats criticized the maneuver, arguing it was inappropriate to add a bill that makes so many regulatory changes to an appropriations measure. Sen. Richard Durbin, D-Ill., slammed Shelby, noting that his legislation is larger than the underlying bill he added it to.
"Why are you doing this?" Durbin said. "Why did you eat this bill by putting in an amendment that is longer than the entire authorizing bill?"
In response, Shelby appeared to acknowledge his strategy to force Democrats to the table.
"You know why we're doing this," he said. "You've been here a long time."
Shelby and other Republicans repeatedly said they hoped to broker a deal on the regulatory relief bill and suggested negotiations are moving forward.
"It remains my strong preference that we find a way to move forward on a bipartisan basis," Shelby said. "There are a lot of back channels going on right now."
The appropriations bill would provide funding for the Treasury and Judiciary departments, Small Business Administration, Securities and Exchange Commission and Commodity Futures Trading Commission, among others.
But the entire text of Shelby's Financial Regulatory Improvement Act of 2015 was added to the bill. That legislation would raise the threshold for systemically important banks to $500 billion of assets, revamp how the Financial Stability Oversight Council designates firms as systemically important and make some limited changes to the housing finance system.
It also includes far less controversial measures that would provide banks relief from annual privacy disclosure requirements, give permission for privately insured credit unions to become members of the Federal Home Loan Bank system, create an exemption for banks under $10 billion of assets from the Volcker Rule and require the National Credit Union Administration both to hold public hearings and receive public comment about its budget.
Separately, the appropriations bill includes other provisions that were not part of Shelby's original text. Those would subject the budget of the Consumer Financial Protection Bureau to the appropriations process and replace its single director with a five-person commission.
