House passes Wall Street reform tweak

The House passed legislation on Wednesday that would require the Consumer Financial Protection Bureau to create an advisory board for consulting the agency about small business needs.

Passage fell largely along party lines by a vote of 235-183.

The House Financial Services Committee originally approved the bill earlier this year with bipartisan support. But Democrats are now objecting to an amendment added before the measure hit the floor that would limit the amount of funds the CFPB could request from the Federal Reserve for two years.  The amendment would cut the agency’s budget by $45 million over the next five years and $100 million over the next decade, according to the CFPB.

{mosads}The White House issued a veto threat against the measure due to opposition to the limitations on the CFPB’s budget. A Statement of Administration Policy further argued the bill is unnecessary given that the CFPB  “already conducts significant stakeholder outreach” by convening a Community Bank Advisory Council and a Credit Union Advisory Council.

The nonpartisan Congressional Budget Office estimates the bill would cost $9 million over ten years.

Rep. Maxine Waters (D-Calif.), the top Democrat on the House Financial Services Committee, accused Republicans of employing a double standard when they demand offsets to legislation, pointing to a bill last week to repeal the estate tax that would add to the deficit.

“I find this ironic that this House has determined now is the time to offset the cost of legislation,” Waters said.

Rep. Denny Heck (D-Wash.), one of the original sponsors of the bill, lamented that he was now urging members to vote against it.

“I cannot exaggerate to you how saddened I am, how much I regret, and how surreal I find it, but I stand here now and ask my colleagues, please vote no against my bill. Oppose the bill that I have worked so hard on for nearly two years,” Heck said.

But Rep. Robert Pittenger (R-N.C.), the bill’s author, said the limitations on funding the CFPB would be allowed to draw would be a relatively minimal 0.1 percent reduction. He noted the agency would still have access $6.7 billion in that timeframe.

“If the CFPB can’t find $9 million in savings over 10 years out of a total potential draw of $6.7 billion, then they need another advisory board of small business owners who will travel to D.C. and teach the CFPB how to budget,” Pittenger said.

The bill would require the CFPB director to appoint at least 15, or up to 20, members to the Small Business Advisory Board.

The House adopted an amendment by voice vote from Rep. Annie McLane Kuster (D-N.H.) encouraging the CFPB director to include the participation of veteran-owned small businesses. Another amendment offered by Kuster, adopted 244-173, would require the inclusion of minority- and women-owned business representatives in the Small Business Advisory Board’s membership.