[Congressional Record Volume 169, Number 198 (Friday, December 1, 2023)]
[House]
[Pages H6055-H6062]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
PROVIDING FOR CONGRESSIONAL DISAPPROVAL OF THE RULE SUBMITTED BY THE
BUREAU OF CONSUMER FINANCIAL PROTECTION RELATING TO ``SMALL BUSINESS
LENDING UNDER THE EQUAL CREDIT OPPORTUNITY ACT (REGULATION B)''
Mr. WILLIAMS of Texas. Madam Speaker, pursuant to House Resolution
891, I call up the joint resolution (S.J. Res. 32) providing for
congressional disapproval under chapter 8 of title 5, United States
Code, of the rule submitted by the Bureau of Consumer Financial
Protection relating to ``Small Business Lending Under the Equal Credit
Opportunity Act (Regulation B)'', and ask for its immediate
consideration in the House.
The Clerk read the title of the joint resolution.
The SPEAKER pro tempore. Pursuant to House Resolution 891, the joint
resolution is considered read.
The text of the joint resolution is as follows:
S.J. Res. 32
Resolved by the Senate and House of Representatives of the
United States of America in Congress assembled, That Congress
disapproves the rule submitted by the Bureau of Consumer
Financial Protection relating to ``Small Business Lending
Under the Equal Credit Opportunity Act (Regulation B)'' (88
Fed. Reg. 35150 (May 31, 2023)), and such rule shall have no
force or effect.
The SPEAKER pro tempore. The joint resolution shall be debatable for
1 hour, equally divided and controlled by the chair and ranking
minority member of the Committee on Financial Services or their
respective designees.
The gentleman from Texas (Mr. Williams) and the gentlewoman from
California (Ms. Waters) each will control 30 minutes.
The Chair recognizes the gentleman from Texas.
General Leave
Mr. WILLIAMS of Texas. Madam Speaker, I ask unanimous consent that
all Members may have 5 legislative days in which to revise and extend
their remarks and submit extraneous material on the bill under
consideration.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Texas?
There was no objection.
[[Page H6056]]
Mr. WILLIAMS of Texas. Madam Speaker, I yield myself such time as I
may consume.
Madam Speaker, I rise today in support of this joint resolution of
disapproval. We must overturn the CFPB's small business lending rule to
ensure small businesses across America, which are the backbone of our
country, have continued access to affordable credit to support and grow
our economy.
Access to affordable credit is key to ensuring communities across
America remain vibrant. Unfortunately, the CFPB's small business
lending rule undermines the goal of affordable and available credit,
which I think we all should share.
Here is why. First, the CFPB's rule is overly broad. It will require
lenders to collect massive amounts of data whenever a small business
owner applies for credit. Most of the information is unnecessary to
make a fair, equitable, safe, and sound loan. Requiring lenders to
provide the information infringes on small business owners' rights to
privacy about their personal and business information when applying for
credit.
Second, the CFPB's rule is burdensome. Community banks and credit
unions across America account for the majority of small business
lending. They are doing their part. Despite claims from my colleagues
across the aisle, this rule does not go after big banks. It will have
the biggest impact on the small community financial institutions
already operating under the thinnest of margins because of runaway
inflation and increased interest rates through the Federal Reserve--in
general, the Biden economy.
The rule also discourages banks and credit unions from expanding
their lending portfolios. They might simply decide that the droves of
new compliance officers they would have to hire to comply with this
onerous rule would simply not be worth it, and Main Street is hammered
again.
The CFPB Director says he is trying to be sensitive to the needs of
small community financial institutions, oftentimes advocating for
relationship banking. However, in the rule, CFPB sets the transaction
threshold at an incredibly low 100 loans in the preceding 2 calendar
years. This means the smallest of banks, small businesses, and their
owners will be the ones to bear the brunt of the unnecessary data
collection, and Main Street is hammered again.
Third, the rule will be difficult to implement. The rule itself is
nearly 900 pages and requires lenders to report 81 data fields.
Developing compliance systems to achieve this will be extremely costly
for firms, which takes resources away from actually lending to small
businesses, and Main Street is hammered again.
The timeline for implementation is also insufficient for lenders to
develop the necessary systems to comply with such a complex and
burdensome regulation. Each hour a lender spends on the overly broad
data collection demanded by the rule is an hour not devoted to ensuring
credit is available and affordable for small businesses, and Main
Street is hammered again.
Finally, it is unclear what the Bureau intends to do with its
exceedingly expansive data demands. What we do know is the CFPB plans
to post the data publicly on the CFPB's website. This is concerning,
given the Bureau's alarming record of facilitating the naming and
shaming of companies whose business activities progressive activists
want to attack, adding to the concerns of the CFPB's abysmal track
record of protecting the highly sensitive data it already collects.
In fact, back in February of this year, there was a major
unauthorized data breach by a CFPB employee, which included personally
identifiable information and confidential supervisory information.
Therefore, why should we ever trust them to protect sensitive
information of small business owners this time around?
To sum it up, the rule is backward-looking, anti-small business,
anti-capitalism, anti-competition, anti-free markets, and anti-risk and
reward.
It is critical that we pass this resolution to overturn this reckless
CFPB rule to protect small business access to the credit needed to
continue to innovate and grow our economy. A new idea while we are at
it: Let's put people back to work again.
Madam Speaker, I urge my colleagues to support this resolution, and I
reserve the balance of my time.
Ms. WATERS. Madam Speaker, I yield myself such time as I may consume.
Madam Speaker, S.J. Res. 32 would repeal the CFPB's small business
lending rule, which was required by Congress in section 1071 of the
Dodd-Frank Wall Street Reform and Consumer Protection Act. The CFPB's
rule would simply require lenders to collect and report data on small
business lending. This data will help drive competition in the market,
lowering small business costs, and help combat discrimination.
I worked closely with my colleague, Congresswoman Nydia Velazquez,
who is the ranking member of the Small Business Committee, to ensure
that this provision was included in the Dodd-Frank Act because we both
knew how critical this data would be to helping small businesses.
Access to capital is a key challenge that many small businesses face.
For example, Goldman Sachs found that over 75 percent of small
businesses they surveyed were concerned about access to capital.
Research has also shown that minority-, women-, and LGBTQ+-owned
businesses are more likely to be denied loans and pay steeper interest
rates.
Access to capital is an issue for many family farms, which don't have
the same access that larger agricultural corporations have. In
addition, access to capital is an issue for our young people working in
the gig economy seeking to start a business of their own but too often
told ``no'' by banks.
Unfortunately, section 1071 of Dodd-Frank was not implemented for 13
years. In fact, small business owners had to sue the CFPB under the
Trump administration to force implementation of this rule.
One of the small business owners who sued the CFPB was ReShonda
Young, a Black woman who founded Popcorn Heaven, a small business
selling gourmet popcorn in Waterloo, Iowa. Ms. Young explained that she
was a victim of discriminatory lending practices, saying: ``In several
instances, there was just blatant discrimination, and in other cases, I
found out about it later on. And it wasn't just me.''
She further explained: ``I had a regular hourly income. My personal
expenses were pretty low, so it wasn't like I couldn't cash infuse from
my personal [income] if I needed to. My credit score was good, but I
couldn't get what I needed. . . . Enough of the disrespect. Enough with
the blatant disrespect. When a bank says, `We don't want your business
for any good reason. Why don't you move your account elsewhere?' it was
at that point, okay, something has to be done.''
The CFPB, under the leadership of a Trump appointee, settled the case
and agreed to a court-supervised timeline, resulting in the final rule
that the CFPB issued this year.
Now that the CFPB's rule has been finalized after all of these years,
so many other small businesses in Iowa, North Carolina, Texas,
California, and all across the country will be able to reap the
benefits of a more transparent lending marketplace that Ms. Young
should have had.
Specifically, the CFPB rule will allow small businesses to comparison
shop between lenders and see how much other small businesses are being
charged for their loans. This price transparency is essential to a
competitive and fair marketplace.
In designing the rule, the CFPB was mindful of its impact on
community financial institutions. For example, the rule completely
exempts lenders that originated fewer than 100 small business loans in
each of the 2 preceding years. This fully exempts more than 80 percent
of depository institutions, including 98 percent of credit unions. For
lenders that originated more than 100 loans, they would have more than
2 years before they would need to begin to comply with the rule in
2026.
Make no mistake, S.J. Res. 32 is just another part of Republicans'
relentless attack on the CFPB. They have erroneously claimed that the
CFPB is unconstitutional and unaccountable and have even gone so far as
to attempt to eliminate the agency altogether.
{time} 0930
Our constituents disagree. A recent bipartisan poll found that 82
percent of
[[Page H6057]]
Americans, including 77 percent of Republicans, support the CFPB and
its mission.
I will highlight three main points about the CFPB small business
lending rule that this resolution would repeal. First, the data
collected under the rule is very similar to data collected under the
Home Mortgage Disclosure Act or HMDA.
This data collection under HMDA has been going on for decades,
successfully bringing much needed transparency to the mortgage market.
Despite misleading claims by Republicans, I want to be very clear that
small businesses are not--are not--are not required to provide
demographic information about their ownership under the rule. It is
completely voluntary.
I have to repeat that because too many on the opposite side of the
aisle are telling people that it is a mandate. It is not. It is
voluntary.
Second, this rule will help all small businesses thrive by providing
greater transparency that will drive competition in the small business
lending market ultimately increasing access to credit and lowering
interest rates for small businesses.
Third, as I mentioned earlier, we have seen how HMDA data from
mortgages have been instrumental to identifying discriminatory trends
like modern-day redlining. The CFPB's rule would similarly help prevent
discrimination in the small business lending market, giving our
regulators and the public another tool to identify discriminatory
trends.
Many of us also recall the challenges that too many small businesses
faced during the COVID-19 pandemic. Unfortunately, when Congress
stepped in to provide relief through the Paycheck Protection Program,
or PPP, the big banks that were tasked with implementing the program
chose to prioritize their concierge clients, including some Members of
Congress, leaving small businesses, especially those owned by people of
color, out in the cold.
It is perhaps not a coincidence that the same big banks who misused
PPP to the detriment of small businesses during the early stages of the
pandemic are now pushing for the passage of this Senate Joint
Resolution 32 opposing the CFPB, which would help them continue to
operate with a lack of transparency and avoid accountability.
However, the big banks are alone in their support for this misguided
resolution. In fact, more than 230 organizations representing small
businesses, family farmers, community leaders, and others strongly
oppose S.J. Res. 32.
There is a lot of talk in Congress about how we love small
businesses, how we support small businesses, but the proof of the
pudding is in the eating. Therefore, I urge Members on both sides of
the aisle to actually do something to help small businesses.
Stop talking about how you support small businesses when you know
they need access to capital that they don't have. We want to do
something real for small businesses. If you do, vote down this harmful
resolution.
Madam Speaker, I reserve the balance of my time.
Mr. WILLIAMS of Texas. Madam Speaker, I yield 1 minute to the
gentlewoman from the great State of Texas (Ms. De La Cruz).
Ms. De LA CRUZ. Madam Speaker, I thank the gentleman for yielding.
I rise today to express my strong support for S.J. Res. 32, a
resolution disproving of the CFPB's overreaching and burdensome rule
under section 1071 of the Dodd-Frank Act.
This rule is nearly 900 pages long. It imposes onerous data
collection requirements on small business lenders in places like south
Texas.
This regulatory overreach is not just impractical; it directly
threatens the lifeline of America's economy--our great small
businesses.
Mom-and-pop shops are the backbone of our communities and need access
to create, to grow, and to thrive. This rule, with its misaligned
definitions and excessive demands, will only hinder their access to the
necessary financial resources.
By supporting this resolution, we stand for common sense, for small
businesses, for community banks, for local families, and for a
regulatory environment that fosters economic growth.
I urge my colleagues to join me in supporting this resolution to
safeguard the health of our Nation's economy.
Ms. WATERS. Madam Speaker, I yield such time as she may consume to
the gentlewoman from New York (Ms. Velazquez), the ranking member of
the Small Business Committee who has been working on the Small Business
Committee for over 30 years and served as the chair before the last
election and who has been fighting for small businesses all of her
career.
Ms. VELAZQUEZ. Madam Speaker, I thank Ranking Member Waters for
yielding.
I rise today in strong opposition to this resolution. As one of the
central architects of section 1071, I understand better than most what
this provision does and doesn't do.
During my time as ranking member of the Small Business Committee and
as a senior member of the Financial Services Committee, I have seen
women- and minority-owned small businesses struggle to access capital
due to the lack of data and transparency related to small business
lending.
The scant data that does exist continues to show these businesses
lack the same access to financing compared to White-owned firms.
Section 1071 attempts to remedy this by requiring financial
institutions to collect and report on the demographics of small
business owners applying for financing.
Doing so facilitates the enforcement of fair lending laws and
identifies businesses and community development needs.
Supporters of this resolution claim it will excessively burden
smaller institutions. However, CFPB Director Chopra recently testified
that approximately 2,000 banks will be exempted from the rule's
reporting requirements.
Others claim the rule is too intrusive. Yet, safeguards like
voluntary reporting--and you are going to hear time and again that this
is a mandate even when I took the text in the manual and read it to the
Members. It is voluntary. It is not a mandate. Unique identifiers are
included in the rule. Without this information, discriminatory lending
will continue.
When crafting this rule, the CFPB conducted considerable outreach to
small firms and considered thousands of public comments from
entrepreneurs.
During a recent Small Business Committee hearing, we received
testimony that this rule will help the market better address both the
lack of access to affordable capital and the rise of irresponsible
lending.
Mr. MEUSER. Madam Speaker, will the gentlewoman yield?
Ms. VELAZQUEZ. Madam Speaker, I will not yield.
It will allow lenders to help tailor their products and services to
meet their borrower's needs and spur additional investment in small
businesses without creating another government program.
If you are for smaller government spending, look right here. Let's
remedy this situation where we have empirical data that minority women,
small businesses, female-owned businesses, and rural businesses do not
have the same access to affordable capital.
It has been 13 long years. We cannot reverse course now. To do so
would be an insult to the minority-owned businesses that are counting
on our support.
Madam Speaker, I urge my colleagues to vote ``no'' on this
resolution.
Mr. WILLIAMS of Texas. Madam Speaker, I yield 2 minutes to the
gentleman from the great State of Pennsylvania (Mr. Meuser).
Mr. MEUSER. Madam Speaker, I rise today in support of S.J. Res. 32,
which would repeal the Consumer Financial Protection Bureau's (CFPB)
1071 rule, which mandates burdensome personal data collection from
small businesses when they apply for loans from financial institutions.
I very much thank Mr. Williams, the chairman of the Small Business
Committee, for introducing a similar resolution here in the House for
which I am a cosponsor.
Madam Speaker, we are hearing some information that should be of
great interest to us all, that there is no need for small businesses to
comply with the 1071 rule if, in fact, what we just heard is accurate.
I will take it a little bit further here. It is clear in Dodd-Frank
at section
[[Page H6058]]
1071 that any applicant for credit may refuse to provide any
information requested pursuant to subsection B in connection with any
application for credit.
However, the CFPB 1071 rule says a low response rate to this rule may
indicate a failure to comply. Therefore, the CFPB gets the statute
wrong, and this is another example of their overreach. If the statute
is clear that any applicant may refuse, then how can refusal somehow be
a sign that a lender is not complying with the statute? Lenders know
and are rightfully concerned that failing to get a high response rate
will likely result in running afoul of the CFPB or being publicly named
and shamed by progressive activists. Regulating to generate fear among
law-abiding businesses is terrible public policy, Madam Speaker.
I urge us to be real here, to deal with the real world, to actually
engage small businesses as the CFPB should do along with consumers,
along with homeowners, along with small businesses.
We need to support this resolution, and I urge all Members of this
House, as well as President Biden, to stand with small businesses.
Ms. WATERS. Madam Speaker, I yield 1 minute to the gentlewoman from
Ohio (Mrs. Beatty), who is also the ranking member of the Subcommittee
on National Security, Illicit Finance, and International Financial
Institutions.
Mrs. BEATTY. Madam Speaker, I rise today in fierce opposition to this
resolution of disapproval.
For the record, I was a former small business owner for decades. Let
me also thank Ranking Member Waters for clearly clarifying the
language.
The CFPB rule seeks to increase transparency in small business
lending to increase competition, to lower borrowing costs for small
businesses, and to detect and deter lending discrimination and create
new lending opportunities, particularly for small businesses owned by
women, by people of color, LGBTQ individuals, and rural businessowners.
This rulemaking is long overdue, as we heard. By requiring lenders to
provide information about loan applications, including whether they
were approved or denied, as well as pricing data in applicant
demographics, the rule will enhance accountability, which we talked
about, and ensure financial institutions are meeting the needs of the
entire community.
Wouldn't we want to know if we had a loan that was denied?
The SPEAKER pro tempore. The time of the gentlewoman has expired.
Ms. WATERS. Madam Speaker, I yield an additional 1 minute to the
gentlewoman from Ohio.
Mrs. BEATTY. Madam Speaker, I think it is very important. I can't
imagine any one of us applying for a loan and getting it denied that
would not call that lender and say, tell me why my loan was denied.
That is a part of this, Madam Speaker.
Lastly, this transparency will not only benefit small businesses but
also family farms, financial institutions, and the economy overall. I
strongly recommend that we support this and go back and re-read the
language.
Mr. WILLIAMS of Texas. Madam Speaker, I yield 4 minutes to the
gentleman from the great State of Arkansas (Mr. Hill).
Mr. HILL. Madam Speaker, of course, I rise in favor of S.J. Res. 32,
a joint resolution to disapprove this dumb idea from the CFPB.
I am proud to stand with our chairman of the Small Business Committee
who is a humble small business man from Texas.
I know the ranking member of the full committee knows that Mr.
Williams, being a humble small business person, knows how to borrow
money, knows how to be turned down for a loan, have a loan accepted,
and he knows that banks tell him and explain that to him. I am proud to
stand here.
I think it is so interesting that I have heard from the opposition
today, Madam Speaker, well, this is a voluntary thing.
Well, if it is voluntary, then you should vote for this resolution
because it is obviously unnecessary because it is voluntary.
Mr. Meuser makes a very good point, because he says that a sign that
a bank has constant small business lending where they don't report
because every customer for that bank voluntarily said they don't want
to provide that data, it will be a sign of noncompliance. The bank will
be out of compliance. They will be in trouble. They will have an exam.
They will fail that exam.
This rule, Madam Speaker, is not the right approach.
{time} 0945
I have spent 30 years of my 40-year career lending money to small
businesses, raising equity capital for small businesses.
We want every loan we can make and the bank made. We are in the
business to make loans. We are not in the business to turn down loans.
We want them for Black people, White people, LGBTQ people--all people--
banking in our bank, helping us make a profit, helping us serve the
community.
This is overdoing bureaucracy. It is applying a set of rules to
collect a bunch of data that is not going to make small business loans
more affordable or more available in this country. It is not.
Madam Speaker, Republicans are standing here and in the Senate.
Democrats in the Senate voted for this resolution. They know this is
governmental overreach. It shouldn't be imposed on the private sector.
It is going to hurt small business, raise the cost of small business.
This body stands on the side of those community lenders and those
borrowers who want available capital at a reasonable cost to bring
their idea, their dream to life.
So five Democratic Senators joined with Republicans to say: Bad idea,
send it back to the drawing board.
We are standing on this side of the aisle asking our friends on the
other side of the aisle: Bad idea, send it back to the drawing board.
Madam Speaker, I encourage my colleagues to vote ``yes'' for this
resolution.
Ms. WATERS. Madam Speaker, let me just say to the gentleman, your
arguments show that you are here to support the big banks who do not
want small business in the banks. They don't want to be bothered. As a
matter of fact, you try to be convincing that it is not voluntary, but
it is voluntary.
They are asked: Do you want to give this information? It is
voluntary, and you can't get away from that.
Madam Speaker, I yield 2 minutes to the gentlewoman from Texas (Ms.
Garcia), who is also the vice ranking member of the Committee on
Financial Services.
Ms. GARCIA of Texas. Madam Speaker, the beginning of so many great
American stories is built around starting a small business in your
family name, becoming a foundation in your local community--making it
in America.
Small businesses are major drivers of wealth creation in our overall
economy. They account for two-thirds of net new jobs and nearly half of
our U.S. economic activity.
For many of them, that dream starts with going to a bank and getting
a small business loan. For many Americans, the sound of their name, the
color of their skin, the language that they speak or who they love can
doom that dream if a bank says that they are at risk.
This isn't hypothetical. I, too, was born and raised in south Texas.
I can tell you that when I go home and I see some businesses that have
closed, I ask my family whether it was due to the pandemic, or no
demand for the cost of services that they had. I am told that they just
had trouble with finances and they couldn't get a loan.
In some small rural areas, because I did grow up in rural south
Texas, there aren't credit unions everywhere like there are in the city
of Houston where I live now. In the city of Houston, many small
businesses during the pandemic in round one couldn't even get a PPP
loan. We had to go in and do a carve-out to literally force the banks
to provide loans to small businesses.
I am glad that one of my colleagues was openhearted and gave people a
lot of loans. I just hope that that included some to minority small
businesses.
Madam Speaker, this is real. It is not hypothetical. We know that
minority-owned small businesses were less likely to receive a loan
during the pandemic compared to White firms.
The SPEAKER pro tempore. The time of the gentlewoman has expired.
[[Page H6059]]
Ms. WATERS. Madam Speaker, I yield an additional 1 minute to the
gentlewoman from Texas.
Ms. GARCIA of Texas. Regrettably, Madam Speaker, racism and
discrimination flourish in the darkness. We need to shine a light and
allow the Consumer Financial Protection Bureau to make lending more
transparent.
Madam Speaker, a transparent market will be a competitive market.
With transparency in lending, banks are driven to compete and offer
better terms.
With this resolution, extreme MAGA Republicans are protecting the
secret discriminatory practice of banks and lenders. Repealing this
rule would harm all those who stand to benefit.
We want to put profits over people. We want to put light over
darkness.
Madam Speaker, I urge my colleagues to vote against this resolution.
Mr. WILLIAMS of Texas. Madam Speaker, I yield 1 minute to the
gentleman from the great State of Nebraska (Mr. Flood).
Mr. FLOOD. Madam Speaker, I thank the chairman for yielding.
Madam Speaker, I rise in support of S.J. Res. 32 providing
congressional disapproval of the CFPB's Small Business Collection Rule.
I am a businessman myself, and I am proud to say that I have made a
payroll every 2 weeks since I was 24 years old.
I will tell you what happens in a situation like this. I am also a
borrower. I am a borrower of small community banks across the State of
Nebraska.
If you pass something like this, if you go from 7 statutory data
points to 81 data points, I am going to have to pay an accountant to
sit down and sift through all of our business data to put this together
for my bank, my lender, and hope that I get it right so that on the
next bank exam, they are not calling me wanting a whole bunch more
information.
That is the real cost to small business. That is the real cost to
businesses in this Nation. That is what people in this town forget. It
is small businesses. It is small-town employers that make this country
run, that make the money work, so that people can wake up and have cash
in their pocket.
I will say this: If you go from 7 points to 81 points, this is just
another example where the CFPB has expanded the scope of the rule as
far as possible.
Ms. WATERS. Madam Speaker, I yield 3 minutes to the gentlewoman from
Michigan (Ms. Tlaib), the vice ranking member of the Subcommittee on
Housing and Insurance, who has been working on this issue for a long
time.
Ms. TLAIB. Madam Speaker, I thank our ranking member for yielding.
Madam Speaker, the resolution that they are attempting to use to
overturn this rule is about small business lending.
We know that, but what is the problem?
We are now afraid of data? We don't want to collect data? This is
even voluntary.
You are opposing a process that would help create more transparency,
more information gathering, competitiveness, and a fair marketplace for
lenders and small businesses. It is voluntary.
We are scared now? We are scared of voluntarily collecting data?
Section 1071 allows lenders to collect and report lending data,
including voluntarily self-reported by businessowners. This rule does
help small business, and I will give you some examples, particularly
those owned by women, people of color.
We are even going to collect data, especially in my district, of
veterans, many of them Black men and women, who have started businesses
after they served our country. They are all lacking access to credit
that they need to build up their businesses.
Study after study has documented that small business owners,
especially the small business owners in my district, continue to face
discriminatory practices by banks.
We already know for a fact that Black-owned business are less likely
to obtain financing and are offered smaller loans.
Section 1071 will make it easier to eliminate such practices and
enforce our fair lending laws--again, to enforce our fair lending laws.
Maybe that is why. Maybe that is why the banks are crying about this
voluntary process. They are scared. Why?
Had the CFPB Small Business Lending Rule been in place during the
Paycheck Protection Program, Madam Speaker, the transparency required
by this rule would likely have reduced the racial disparity in lending
outcomes that we saw.
There is also a clear precedent for what such a rule can accomplish.
These are real people--and folks can laugh. They can think that this is
not real. These are people that are literally putting their whole life
savings into a small business, and hoping and praying that they have
the investment from the Federal Government.
When the Home Mortgage Disclosure Act established reporting processes
for mortgage lenders that are similar to those in the CFPB rule, did
you all know that lending to Black borrowers for conventional home
purchases increased by 70 percent in 3 years? In 3 years we increased
Black homeownership.
All Americans, not just some, deserve access and fairness, especially
when we continue to bail out these banks for their continued failure
and their discriminatory practices.
Section 1071 promotes transparency, competition, and fairness.
Overturning this is a disservice to our small business owners
everywhere.
I thank our ranking member and others that continue to advocate for
this. This is the right thing to do. This is how we make sure that all
Americans have access.
Mr. WILLIAMS of Texas. Madam Speaker, I yield 4 minutes to the
gentleman from Kentucky (Mr. Barr).
Mr. BARR. Madam Speaker, I rise today in support of my good friend
and colleague, the small business owner from Texas, Congressman
Williams, and I support his resolution under the Congressional Review
Act to nullify the CFPB Small Business Lending Rule, or section 1071 of
the Dodd-Frank Act.
The small business lending rule that was finalized in March is
incredibly onerous. It imposes massive burdens on financial
institutions. It will be misleading and confusing for borrowers. It
will ultimately harm the very small business owners, the minority- and
women-owned small business owners, that they say they want to help
because those are the businesses that will not have access to capital--
certainly not affordable capital.
While the Dodd-Frank Act does charge the Bureau with adopting rules
regarding small business lending, Director Chopra's rule goes far
beyond Congressional intent. By requiring the collection of 81 data
fields, it greatly exceeds what is mandated by statute.
As has been said very eloquently, it will be extremely burdensome on
financial institutions, leading to increased costs and less
availability of credit for millions of Main Street borrowers and
entrepreneurs.
I have to address this absurd argument about the voluntary nature of
the disclosures here. If this is really voluntary--and I want the CFPB
to hear this, the advocate of this rule, I want them to hear.
If this is totally voluntary, when my constituents do not provide the
CFPB with this information, I want the CFPB to go back and watch the
tape, because I don't want my constituents to then be punished by the
CFPB when they are not given the information they want. I am going to
tell my constituents who are being harassed by this bureaucracy to go
back and listen to the ranking member because she said it is voluntary.
I want them to quote the ranking member to CFPB when the CFPB harasses
them for bureaucracy.
Then, I want everyone here in this Chamber to recognize that this
week, in the Committee on Financial Services, I asked Director Chopra
if he recognizes that if a small business owner fails to understand why
demographic information--irrelevant, by the way, to creditworthiness of
the borrower--demographic data is being collected, it could lead to
confusion and misunderstanding and potential liability for the
financial institution.
For example, the rule requires small business owners to disclose
their race, their ethnicity, and their gender or sexual orientation
when applying for that loan. They have to give this information prior
to underwriting. If that loan is denied, the applicant could be
reasonably led to believe that that demographic information was the
basis for the denial and not the myriad of other legitimate factors
which play into lending decisions.
[[Page H6060]]
Madam Speaker, Director Chopra agreed with me that this could be
confusing to the borrower.
Clearly, there are a lot of important factors that were not been
properly considered prior to the finalization of this rule.
Does this make sense?
I thought we got to a point in the country where race was not
supposed to matter, but the other side of the aisle thinks race is the
only thing that matters, and that is wrong. That is wrong.
This rule's requirement will force many community banks and credit
unions across the country to exit small business lending altogether.
That is what my constituents tell me.
Small banks across Central/Eastern Kentucky tell me this is so
burdensome; the requirements are so ridiculous that they are just going
to exit small business lending altogether.
Now, how does that help the minority-owned small business on Main
Street USA? It hurts them.
This is absurd that we would actually hurt minority-and women-owned
small businesses by burdening them with massive amounts of red tape.
The SPEAKER pro tempore. The time of the gentleman has expired.
Mr. WILLIAMS of Texas. Madam Speaker, I yield an additional 30
seconds to the gentleman from Texas.
{time} 1000
Mr. BARR. Madam Speaker, finally, I want to address this ridiculous
argument from my colleagues on the other side of the aisle who
constantly cite this poll that they keep talking about, which Democrats
wanted. They say, oh, the American people love the CFPB because it
describes the CFPB as the Salvation Army or something.
The truth of the matter is, if the poll was asked with the truthful
information--that this agency drives up the cost and decreases the
availability of credit, increases regulatory costs for small
businesses, increases interest costs for Americans for their credit
cards when they pay on time, decreases access to consumer credit, and
is completely exempt from the appropriations process and totally
unaccountable--if you ask the question the truthful way, the American
people overwhelmingly say the CFPB is a failure.
Ms. WATERS. Madam Speaker, I yield myself such time as I may consume.
Madam Speaker, we have these Members on the opposite side of the
aisle spending all of this time supporting the biggest, most profitable
banks in the country, yet these Members won't stand up for small
business lending. They don't want the data so that we can understand
what is going on and why people in this country, minorities in
particular, farmers, small farmers, family farmers, et cetera, can't
get loans.
In the last decade, these megabanks made so much money: J.P. Morgan,
$215 billion; Wells Fargo, $197 billion; Bank of America, $105 billion;
Citigroup, $93 billion. They repeatedly broke the law, even though they
were making all of this money. I want you to know they consider this
just the cost of doing business.
We have even more here when we take a look at some of the other banks
that paid fines instead of lending money. They would rather pay fines
instead of lending to small businesses. What kind of fines are we
talking about here? We fined them for all kinds of fraudulent activity.
In the last decade, megabanks made so much money, and then they
repeatedly paid fines. For example, the Bank of America paid $66
billion in fines. They could have been lending this to small
businesses. J.P. Morgan paid $43 billion in fines. They could have been
lending this to small businesses. Citigroup paid $19 billion in fines.
They could have been lending this to small businesses. Wells Fargo paid
$12 billion in fines.
Some of our Members want to say that we just want to shame these big
banks. Yes, I do because it is a shame that they are so profitable that
they do not want to spend time with small businesses. It takes up too
much time. Small businesses don't earn as much money for the bank, et
cetera. They don't even want them in their banks, and we have to do
something about that.
We are shining a light on the existing practices of lenders, and if
those lenders are charging minorities and small family farmers, et
cetera, exorbitant interest rates, there is no reason that we should
not get the transparency that we need to stop this.
I will tell you, one of the reasons you hear us being so passionate
over here is because the big banks don't need you to defend them. They
don't need you to stand up for them. You should be putting your time
and effort into what you can do about the small businesses.
I am not going to go into a lot of information. We have Members on
the opposite side of the aisle who felt they needed capital. When we
did PPP, they came to the government, competing with real small
businesses that could not get capital. Not only did they take out the
money, but they have been forgiven for it. They didn't have to pay it
back.
I am not going to talk about everybody, but I am going to mention
Marjorie Taylor Greene because she is everywhere talking about
everybody, claiming she is for small business. She took out $180,000,
and she has been forgiven.
I am not going to talk about the rest of them, some of my friends
over there, but I have a whole list of Members on the opposite side of
the aisle who took out PPP money and didn't need it, some of them as
rich as cream. They took this money, and they are not paying it back.
Then, they come in here and talk about why we should not have
transparency and do everything that we can for these small businesses
that are desperate for capital.
You can sing the song that you love small business all that you want.
You can have the Small Business Saturday with a big, fake kind of
operation on small business lending in your community, but it doesn't
do any good if they don't get the capital. They need the money. They
need to be treated fairly.
Yes, I want to shame the big banks. I want to shame them. You have
one of these banks that even took out false accounts, made up accounts,
and we had to stop them. We fined them, but do you know what? They are
too big to fail, and they keep doing what we are fining them for.
Madam Speaker, I reserve the balance of my time.
Mr. WILLIAMS of Texas. Madam Speaker, I yield 1 minute to the
gentleman from North Carolina (Mr. McHenry), the chairman of the
Financial Services Committee.
Mr. McHENRY. Madam Speaker, small businesses are the lifeblood of the
American economy. When you burden small business, you limit job growth,
economic gain, economic opportunity, and American growth. With more
regulation on businesses, it drives up the cost of doing business.
I commend the chair of the Small Business Committee for this
resolution that we have on the House floor today that is in support of
American small business. This resolution would stop the CFPB's small
business data collection rule, which is onerous, overly complex, and
difficult to implement. All American businesses would be burdened by
it--disproportionately, the small businesses that create most of the
jobs in America.
This rule would stifle American businesses' access to affordable
credit, and it will facilitate the naming and shaming of lenders whose
business practices are legal, nondiscriminatory, and safe and sound.
The progressive activists on the left want to use that database so
they can call out the things that they don't like for political
activism. I don't think that is responsible. I don't think that is in
the interest of the American economy, and it surely is not in the
interest of consumer protection.
Madam Speaker, let's support this resolution. Let's oppose the rule.
Let's support small business.
Ms. WATERS. Madam Speaker, I yield myself such time as I may consume.
Yes, I am a political activist. I am an activist for the people who
send us here to represent them. I am an activist for the least of
these. I am an activist for small business. I am an activist for
veterans. I am an activist for children. I am an activist for
education, for better healthcare, and I am very proud of it.
I tell you, it is shameful for us to continue to be dominated and
controlled by the biggest banks in America, taking time on the floor of
the people's House to defend them and to vote
[[Page H6061]]
against the very people who send you to this House to represent them.
It is absolutely shameful.
It is time to get out from under the influence and control of the
biggest banks in America and stand up for the people who really need to
make these banks do what they should be doing rather than saying: No,
we are not going to comply with the law, and yes, we will pay the fines
because we are rich. We have so much money we can do that.
Madam Speaker, I reserve the balance of my time.
Mr. WILLIAMS of Texas. Madam Speaker, may I inquire as to the time
remaining.
The SPEAKER pro tempore. The gentleman from Texas has 13\1/2\ minutes
remaining. The gentlewoman from California has 3\1/2\ minutes
remaining.
Mr. WILLIAMS of Texas. Madam Speaker, I yield 2 minutes to the
gentlewoman from California (Mrs. Kim).
Mrs. KIM of California. Madam Speaker, I rise in strong support of
S.J. Res. 32. This is a CRA resolution to rescind the final rule
implementing section 1071 of Dodd-Frank. I thank Chairman Williams and
Senator Kennedy for their leadership to rescind the CFPB's harmful
proposal.
The rule is nearly 900 pages and requires lenders to report 81 data
fields. If the CFPB's proposal is enacted, small financial institutions
will be forced to devote more of their time to comply with burdensome
regulations rather than focusing on providing loans for small business
owners.
With credit tightening for small businesses due to persistent
inflation, higher interest rates, and an uncertain economic
environment, the CFPB's 1071 rule would impose higher costs for small
businesses and lead to a decrease in lending to small, minority-owned,
and women-owned businesses.
Earlier this year, the CFPB suffered a major data breach when an
employee forwarded consumer information of more than a quarter million
to a personal email account. How can we trust the CFPB to properly
manage the collection of additional data when it cannot efficiently
safeguard existing data?
I urge Director Chopra to go back to the drawing board on section
1071 and issue a rule that gets it right without punishing small banks
and small credit unions with higher compliance costs and burdensome
requirements.
Madam Speaker, I strongly urge my colleagues to support this
resolution and access to credit for small businesses by voting in favor
of this resolution.
Ms. WATERS. Madam Speaker, I yield myself the balance of my time for
closing.
When we started this debate, I mentioned ReShonda Young, who happens
to be a young, Black woman from Waterloo who had many challenges
getting a small business loan and sued the CFPB to complete the section
1071 rule. After CFPB settled the case with her, Ms. Young said: ``I am
just humbled to be part of the process. Sometimes we feel so small, but
this is one of those things that shows if we are willing to speak up,
we actually can make a difference.''
Ms. Young has since sold her business and is now working with other
investors to try to open up the first minority bank in Iowa, with the
goal of being certified as a CDFI, offering the kind of small business
loans to others that she had such a time obtaining.
Let me just tell you something. We support CDFIs, the community
development financial institutions. Why do we support them? Because
they could not get loans from the banks in America. Here we are, the
taxpayers, further trying to help small businesses by supporting these
community development financial institutions. They were developed
because small businesses couldn't get loans.
Then, on the opposite side of the aisle, we have people who are
opposing how we can support these small businesses by getting the
transparency that we need to have done. They would rather support the
biggest banks in America and have the taxpayers try to do something
about small businesses with CDFIs than give their small businesses an
opportunity.
I tell you, I don't know how they are going to vote on the other
side, but this issue is not going to go away. I tell you that the
constituents are going to learn in this country who is supporting small
businesses. All of this talk and this rhetoric about ``I love small
businesses,'' ``I support small businesses,'' will not continue to
work.
The fact of the matter is, small businesses are shutting down,
closing, because they don't have access to capital.
For all those Members on the opposite side of the aisle who took out
PPP loans that have been forgiven, you ought to be ashamed and not
oppose the CFPB from trying to protect these small banks, as the courts
have told them to do.
{time} 1015
Madam Speaker, there is a lot more that can be said. We are going to
continue to unveil this information about who is simply spouting
rhetoric and who is actually doing something for small businesses.
It is unfortunate that we have to fight this hard. We have to do
everything that we possibly can because the banks don't want them in
their banks. They don't want to be bothered with them. They are too
small.
We have small businesses who only need $50,000 or $75,000 to improve
their technology to take their businesses to a place where they can
earn more money.
We can't even start to talk about startup capital. None of them get
startup capital. If they are able to convince anybody for a little
capital to expand their businesses, they will do that. Otherwise, small
businesses do not have the support of the Republicans in the House of
Representatives as it is seen here today.
Madam Speaker, I yield back the balance of my time.
Mr. WILLIAMS of Texas. Madam Speaker, as my colleagues and I have
stated today, my biggest fear is that many lenders may decide to fully
exit small business lending due to the overly burdensome collection
requirements, or because they don't want to put their small business
customers in an uncomfortable situation.
I do not believe this is the outcome Congress, or the CFPB, intended
with the implementation of this section of Dodd-Frank. However, I know,
as a small business owner myself, that if this rule goes into effect it
will not bode well for small businesses seeking the credit needed to
grow and support their communities. That is the bottom line.
We need to help small businesses. We need to help them create jobs
but also to create net worth among their employees.
Madam Speaker, I urge my colleagues to support this resolution, and I
yield back the balance of my time.
The SPEAKER pro tempore. All time for debate has expired.
Pursuant to the rule, the previous question is ordered on the joint
resolution.
The question is on the third reading of the joint resolution.
The joint resolution was ordered to be read a third time, and was
read the third time.
The SPEAKER pro tempore. The question is on passage of the joint
resolution.
The question was taken; and the Speaker pro tempore announced that
the ayes appeared to have it.
Ms. WATERS. Madam Speaker, on that I demand the yeas and nays.
The yeas and nays were ordered.
The SPEAKER pro tempore. Pursuant to clause 9 of rule XX, this 15-
minute vote on passage of the joint resolution will be followed by a 5-
minute vote on adoption of House Resolution 878.
The vote was taken by electronic device, and there were--yeas 221,
nays 202, answered ``present'' 1, not voting 10, as follows:
[Roll No. 690]
YEAS--221
Aderholt
Alford
Allen
Amodei
Armstrong
Arrington
Babin
Bacon
Baird
Balderson
Banks
Barr
Bean (FL)
Bentz
Bergman
Bice
Biggs
Bilirakis
Bishop (NC)
Boebert
Bost
Brecheen
Buchanan
Buck
Bucshon
Burchett
Burgess
Burlison
Calvert
Cammack
Carey
Carl
Carter (GA)
Carter (TX)
Case
Chavez-DeRemer
Ciscomani
Cline
Cloud
Clyde
Cole
Collins
Comer
Crane
Crenshaw
Cuellar
Curtis
D'Esposito
Davidson
De La Cruz
DesJarlais
Diaz-Balart
Donalds
Duarte
Duncan
Dunn (FL)
Edwards
[[Page H6062]]
Ellzey
Emmer
Estes
Ezell
Fallon
Feenstra
Ferguson
Finstad
Fischbach
Fitzgerald
Fitzpatrick
Fleischmann
Flood
Foxx
Franklin, Scott
Fry
Fulcher
Gaetz
Gallagher
Garbarino
Garcia, Mike
Gimenez
Golden (ME)
Gonzales, Tony
Good (VA)
Gooden (TX)
Gosar
Granger
Graves (LA)
Graves (MO)
Green (TN)
Greene (GA)
Griffith
Grothman
Guest
Guthrie
Hageman
Harris
Harshbarger
Hern
Higgins (LA)
Hill
Hinson
Houchin
Hudson
Huizenga
Hunt
Issa
Jackson (TX)
James
Johnson (SD)
Jordan
Joyce (OH)
Joyce (PA)
Kean (NJ)
Kelly (MS)
Kiggans (VA)
Kiley
Kim (CA)
Kustoff
LaHood
LaLota
LaMalfa
Lamborn
Langworthy
Latta
LaTurner
Lawler
Lee (FL)
Lesko
Letlow
Loudermilk
Lucas
Luetkemeyer
Luna
Luttrell
Mace
Malliotakis
Maloy
Mann
Manning
Massie
Mast
McCaul
McClain
McClintock
McCormick
McHenry
Meuser
Miller (IL)
Miller (OH)
Miller (WV)
Miller-Meeks
Mills
Molinaro
Moolenaar
Mooney
Moore (AL)
Moore (UT)
Moran
Murphy
Nehls
Newhouse
Norman
Nunn (IA)
Obernolte
Ogles
Owens
Palmer
Peltola
Pence
Perez
Perry
Pfluger
Posey
Reschenthaler
Rogers (AL)
Rogers (KY)
Rose
Rosendale
Rouzer
Roy
Rutherford
Salazar
Scalise
Schweikert
Scott, Austin
Self
Sessions
Simpson
Smith (MO)
Smith (NE)
Smith (NJ)
Smucker
Spartz
Stauber
Steel
Stefanik
Steil
Steube
Strong
Tenney
Thompson (PA)
Tiffany
Timmons
Turner
Valadao
Van Drew
Van Duyne
Van Orden
Wagner
Walberg
Waltz
Weber (TX)
Webster (FL)
Wenstrup
Westerman
Williams (NY)
Williams (TX)
Wilson (SC)
Wittman
Womack
Yakym
Zinke
NAYS--202
Adams
Aguilar
Allred
Amo
Auchincloss
Balint
Barragan
Beatty
Bera
Beyer
Bishop (GA)
Blumenauer
Blunt Rochester
Bonamici
Bowman
Boyle (PA)
Brown
Brownley
Budzinski
Bush
Caraveo
Carbajal
Cardenas
Carson
Carter (LA)
Cartwright
Casar
Casten
Castor (FL)
Castro (TX)
Cherfilus-McCormick
Chu
Clark (MA)
Clarke (NY)
Cleaver
Clyburn
Cohen
Connolly
Correa
Costa
Courtney
Craig
Crockett
Crow
Davids (KS)
Davis (IL)
Davis (NC)
Dean (PA)
DeGette
DeLauro
DelBene
Deluzio
DeSaulnier
Dingell
Doggett
Escobar
Eshoo
Espaillat
Evans
Fletcher
Foster
Foushee
Frankel, Lois
Frost
Gallego
Garamendi
Garcia (IL)
Garcia (TX)
Garcia, Robert
Goldman (NY)
Gomez
Gonzalez, Vicente
Gottheimer
Green, Al (TX)
Grijalva
Harder (CA)
Hayes
Higgins (NY)
Himes
Horsford
Houlahan
Hoyer
Hoyle (OR)
Huffman
Ivey
Jackson (IL)
Jackson (NC)
Jacobs
Jayapal
Jeffries
Johnson (GA)
Kamlager-Dove
Kaptur
Keating
Kelly (IL)
Khanna
Kildee
Kilmer
Kim (NJ)
Krishnamoorthi
Kuster
Landsman
Larsen (WA)
Larson (CT)
Lee (CA)
Lee (NV)
Lee (PA)
Leger Fernandez
Levin
Lieu
Lofgren
Lynch
Magaziner
Matsui
McBath
McClellan
McCollum
McGarvey
McGovern
Meeks
Menendez
Meng
Mfume
Moore (WI)
Morelle
Moskowitz
Moulton
Mrvan
Mullin
Nadler
Napolitano
Neal
Neguse
Nickel
Norcross
Omar
Pallone
Panetta
Pappas
Pascrell
Payne
Peters
Pettersen
Pingree
Pocan
Porter
Pressley
Quigley
Ramirez
Raskin
Ross
Ruiz
Ruppersberger
Ryan
Salinas
Sanchez
Sarbanes
Scanlon
Schakowsky
Schiff
Schneider
Scholten
Schrier
Scott (VA)
Scott, David
Sewell
Sherman
Sherrill
Slotkin
Smith (WA)
Sorensen
Soto
Spanberger
Stansbury
Stanton
Stevens
Strickland
Swalwell
Sykes
Takano
Thanedar
Thompson (CA)
Thompson (MS)
Titus
Tlaib
Tokuda
Tonko
Torres (CA)
Torres (NY)
Trahan
Underwood
Vargas
Vasquez
Veasey
Velazquez
Wasserman Schultz
Waters
Watson Coleman
Wexton
Wild
Williams (GA)
Wilson (FL)
ANSWERED ``PRESENT''--1
Santos
NOT VOTING--10
Crawford
Jackson Lee
Johnson (OH)
Kelly (PA)
McCarthy
Ocasio-Cortez
Pelosi
Phillips
Rodgers (WA)
Trone
{time} 1047
Mr. GOMEZ, Ms. WILSON of Florida, Mr. VICENTE GONZALEZ of Texas, and
Ms. OMAR changed their vote from ``yea'' to ``nay.''
Mr. WEBER of Texas changed his vote from ``nay'' to ``yea.''
So the joint resolution was passed.
The result of the vote was announced as above recorded.
A motion to reconsider was laid on the table.
____________________