Senate Republican appropriators are recommending that the CFPB be placed under the annual appropriations process and that the Community Development Financial Institutions Program continue in FY2018, despite Trump Administration opposition.
The CDFI program would receive $248 million, the same amount it received in FY2017, under the Financial Services appropriations measure released by Senate GOP appropriators Monday.
The measure does not include massive changes to the Dodd-Frank Act, as the House version of the bill does. However, it requires the Office of Management and Budget to conduct a study on the cost of Dodd-Frank.
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That bill also does not include any provision that would place NCUA under the annual funding process.
The Senate bill will not become law in its current form. However, it does provide Republican appropriators' positions when the House and Senate negotiate government-wide spending levels. The House-passed measure contains huge amounts of the Financial CHOICE Act, House Financial Services Chairman Jeb Hensarling's (R-Texas) plan to overhaul Dodd-Frank.
The current Continuing Resolution funding major parts of the federal government, including those in the Financial Services appropriations measure expires on Dec. 8. This means that the House and Senate will be faced with passing another short-term spending measure or enacting legislation funding programs through the end of the fiscal year on Sept. 30. If Congress does not extend funding, large parts of the federal government would be forced to shut down.
The House and Senate bills call for the CFPB to be placed under the annual appropriations process. The Senate makes the CFPB subject to the annual spending process in 2019.
The CFPB currently is funded through draw-downs from the Federal Reserve.
"Under the current structure of the Consumer Financial Protection Bureau [CFPB], the director enjoys unprecedented regulatory and budgetary authority without meaningful appropriations oversight to ensure that the director is effectively managing public money," Republican appropriators said, in explaining the change.
The Senate bill also maintain the $248 million the CDFI program received this year. Community development credit unions are eligible to participate in the CDFI program.
The Trump Administration has proposed eliminating the program, saying it achieved its purpose.
Republican Senate appropriators said they are concerned that the awards process for the CDFI program is not sufficiently transparent and that it is difficult to assess the impact that grants may have on a community.
"The Committee strongly believes it is important to ensure that CDFIs are delivering investments to the borrowers and communities that need it most," GOP appropriators said.
Democrats on the Appropriations Committee criticized the CFPB provision.
"Dodd-Frank created the CFPB with an automatic funding stream, like other financial regulators, in order to protect it from being underfunded and undermined through the annual budget process," they said.
Senate Appropriations Committee Ranking Democrat Pat Leahy of Vermont added, "If the majority wants to…undermine the Consumer Financial Protection Bureau, they should introduce standalone bills that the Senate can debate. These measures should not be buried in must-pass spending bills."
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