[House Report 119-91]
[From the U.S. Government Publishing Office]
119th Congress } { Report
HOUSE OF REPRESENTATIVES
1st Session } { 119-91
======================================================================
1071 REPEAL TO PROTECT
SMALL BUSINESS LENDING ACT
_______
May 6, 2025.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
_______
Mr. Hill of Arkansas, from the Committee on Financial Services,
submitted the following
R E P O R T
together with
MINORITY VIEWS
[To accompany H.R. 976]
The Committee on Financial Services, to whom was referred
the bill (H.R. 976) to repeal the small business loan data
collection requirements under the Equal Credit Opportunity Act,
having considered the same, reports favorably thereon with an
amendment and recommends that the bill as amended do pass.
CONTENTS
Page
Purpose and Summary.............................................. 2
Background and Need for Legislation.............................. 2
Committee Consideration.......................................... 3
Related Hearings................................................. 4
Committee Votes.................................................. 4
Committee Oversight Findings..................................... 7
Performance Goals and Objectives................................. 7
Committee Cost Estimate.......................................... 7
New Budget Authority and CBO Cost Estimate....................... 7
Unfunded Mandates Statement...................................... 7
Earmark Statement................................................ 7
Federal Advisory Committee Act Statement......................... 7
Applicability to the Legislative Branch.......................... 8
Duplication of Federal Programs.................................. 8
Section-by-Section Analysis of the Legislation................... 8
Changes in Existing Law Made by the Bill, as Reported............ 8
Minority Views................................................... 18
The amendment is as follows:
Strike all after the enacting clause and insert the
following:
SECTION 1. SHORT TITLE.
This Act may be cited as the ``1071 Repeal to Protect Small Business
Lending Act''.
SEC. 2. FINDINGS.
Congress finds the following:
(1) Section 704B of the Equal Credit Opportunity Act, as
added by section 1071 of the Dodd-Frank Wall Street Reform and
Consumer Protection Act, imposes data collection and reporting
requirements on financial institutions regarding small business
loans.
(2) These requirements have resulted in increased compliance
costs for financial institutions, potentially reducing access
to credit for small businesses.
(3) The regulatory burdens created by these requirements
disproportionately impact smaller financial institutions, such
as community banks and credit unions, which are critical to
small business lending.
(4) Repealing these requirements will reduce regulatory
barriers and support greater access to credit for small
businesses.
SEC. 3. REPEAL OF THE SMALL BUSINESS LOAN DATA COLLECTION REQUIREMENTS.
(a) In General.--Section 704B of the Equal Credit Opportunity Act (15
U.S.C. 1691c-2) is repealed.
(b) Conforming Amendments.--
(1) Dodd-frank wall street reform and consumer protection act
amendments.--The Dodd-Frank Wall Street Reform and Consumer
Protection Act (12 U.S.C. 5301 et seq.) is amended--
(A) in the table of contents in section 1(b) of such
Act, by striking the item relating to section 1071; and
(B) by striking section 1071.
(2) Equal credit opportunity act amendments.--The Equal
Credit Opportunity Act (15 U.S.C. 1691 et seq.) is amended--
(A) in the table of contents for such Act, by
striking the item relating to section 704B; and
(B) in section 701(b)--
(i) in paragraph (3), by adding ``or'' at the
end;
(ii) in paragraph (4), by striking ``; or''
and inserting a period; and
(iii) by striking paragraph (5).
Purpose and Summary
Introduced on February 4, 2025, by Representative Williams,
H.R. 976, the 1071 Repeal to Protect Small Business Lending
Act, would repeal Section 1071 of the Dodd-Frank Wall Street
Reform and Consumer Protection Act that mandates the collection
and reporting of demographic data on small business loan
applicants.
Background and Need for Legislation
Dodd-Frank Section 1071 amended the Equal Credit
Opportunity Act to require financial institutions to collect
and report specific data about small business credit
applications, including whether the applicant is a women-owned
or minority-owned business. The provision was described as
promoting transparency in small business lending and ensuring
that businesses, particularly those owned by minorities and
women, have equal access to credit. However, the broad mandate
in Section 1071 has led to concerns from lenders of all sizes
about their ability to continue providing access to small
business credit at all.
Under the law, the Consumer Financial Protection Bureau
(CFPB) was given the authority to collect and analyze this
data. Section 1071 allows the CFPB to request ``any additional
data that the Bureau determines would aid in fulfilling the
purposes of this section,''\1\ granting the agency considerable
discretion to expand data collection beyond the original scope.
This opens the door for the agency to impose diversity, equity,
and inclusion (DEI) measures on lenders, who could face
enforcement actions for noncompliance. Further, Section 1071
requires that this data be made public, raising significant
privacy concerns, especially without strong data protections in
place.
---------------------------------------------------------------------------
\1\15 U.S.C. Sec. 1691c-2.
---------------------------------------------------------------------------
The broad data collection mandate will create significant
burdens for small community lenders, leading to higher
administrative and compliance costs and a reduction in
available credit for Main Street businesses. The highly
customized nature of small business lending means that
aggregated data is often meaningless without proper context,
further diminishing its value and increasing its opportunity to
be abused by groups seeking to ``name and shame'' lenders. As
demonstrated by former CFPB Director Chopra's finalized Small
Business Lending Rule, the CFPB leadership can exploit this
expansive authority to push a broader political agenda, to the
detriment of small businesses and lenders trying to support
local economies.\2\
---------------------------------------------------------------------------
\2\CFPB, ``Final Rule: Small Business Lending under the Equal
Credit Opportunity Act (Regulation B),'' (Mar. 30, 2023). https://
www.consumerfinance.gov/rules-policy/final-rules/small-
business-lending-under-the-equal-credit-opportunity-act-regulation-b/.
---------------------------------------------------------------------------
Shortly after the rule was finalized, the Texas Bankers
Association filed a lawsuit against the CFPB, arguing that the
CFPB exceeded its authority and acted in a manner that is
arbitrary and capricious. In March 2025, a Fifth Circuit panel
granted a stay on the rule's implementation pending the outcome
of the appeal.\3\
---------------------------------------------------------------------------
\3\Order, Texas Bankers Association et al. v. Consumer Fin. Prot.
Bureau No. 24-40705 (5th Circuit 2025).
---------------------------------------------------------------------------
Committee Consideration
119TH CONGRESS
On February 4, 2025, Representative Roger Williams (R-TX)
introduced H.R. 976, the 1071 Repeal to Protect Small Business
Lending Act, with Representatives Bill Huizenga (R-MI), Mike
Flood (R-NE), Dan Meuser (R-PA), Ann Wagner (R-MO), Monica De
La Cruz (R-TX), Zach Nunn (R-IA), Troy Downing (R-MT), Byron
Donalds (R-FL), Mike Haridopolos (R-FL), Frank Lucas (R-OK),
Andrew Garbarino (R-NY), Brad Finstad (R-MN) Tim Moore (R-NC),
Andy Barr (R-KY), Mike Collins (R-GA), Warren Davidson (R-OH),
David Kustoff (R-TN), Jack Bergman (R-MI), Claudia Tenney (R-
NY), Ralph Norman (R-SC), Andy Ogles (R-TN), Mike Ezell (R-MS),
Rudy Yakym (R-IN), Ronny Jackson (R-TX), Glenn Grothman (R-WI),
Barry Loudermilk (R-GA), Brandon Gill (R-TX), Dave Taylor (R-
OH), and Beth Van Duyne (R-TX) as original cosponsors.
Representatives Harriet Hageman (R-WY), Greg Murphy, M.D. (R-
NC), Sam Graves (R-MO), Michael Guest (R-MS), Pete Sessions (R-
TX), Derek Schmidt (R-KS), Scott Fitzgerald (R-WI), Gary Palmer
(R-AL), Marlin Stutzman (R-IN), Trent Kelly (R-MS), Dusty
Johnson (R-SD), Tracey Mann (R-KS), Adrian Smith (R-NE),
Michael Cloud (R-TX), Craig Goldman (R-TX), John Carter (R-TX),
Keith Self (R-TX), Mike Lawler (R-NY), John Rose (R-TN),
Mariannette Miller-Meeks (R-IA), Jeff Van Drew (R-NJ), Mark
Alford (R-MO), and Tony Wied (R-WI) were added subsequently as
cosponsors. The bill was referred solely to the Committee on
Financial Services.
Related Hearings
Pursuant to clause 3(c)(6) of rule XIII of the Rules of the
House of Representatives, the following hearing was used to
develop H.R. 976:
The Full Committee held a hearing on February 5, 2025,
titled ``Make Community Banking Great Again.'' A discussion
draft version of the bill was considered in this hearing. The
following witnesses testified: Cathy Owen, Executive Chairman,
Eagle Bank & Trust Company, Little Rock, AR; Susannah Marshall,
Bank Commissioner, Arkansas State Bank Department, Little Rock,
AR; Rebecca Romero Rainey, President & CEO, Independent
Community Bankers of America, Washington, D.C.; Patrick J.
Kennedy Jr., Founding Partner, Kennedy Sutherland, LLP, San
Antonio, TX; Mitria Spotser, Vice President, Federal Policy,
Center for Responsible Lending, Washington, D.C.
The Committee on Financial Services met in open session on
April 2, 2025, to consider, among others, H.R. 976.
Committee Votes
Clause 3(b) of rule XIII of the Rules of the House of
Representatives requires the Committee Report to include for
each record vote on a motion to report the measure or matter
and on any amendments offered to the measure or matter the
total number of votes for and against and the names of the
Members voting for and against.
On April 2, 2025, H.R. 976, as amended, was ordered to be
reported favorably to the House by a recorded vote of 27 yeas
and 22 nays, a quorum being present. (Record Vote No. FC-061).
The Committee considered the following amendments to H.R.
976:
Representative Williams (R-TX) offered an
amendment in the nature of a substitute, which made
minor edits and technical changes. The amendment was
adopted by a voice vote.
Representative Nydia Velazquez (D-NY)
offered an amendment (No. 37) that would delay the
implementation of the bill until the CFPB Director
certifies that small business lending has become more
transparent; large lenders are providing small
businesses disclosures similar to consumer loans; and
no lenders include confessions of judgement as a small
business loan requirement. This amendment creates new
authority for the CFPB over small business lending. The
amendment was defeated in a recorded vote of 22 yeas
and 27 nays, a quorum being present. (Record Vote No.
FC-060).
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Committee Oversight Findings
Pursuant to clause 3(c) of rule XIII of the Rules of the
House of Representatives, the findings and recommendations of
the Committee, based on oversight activities under clause
2(b)(1) of rule X of the Rules of the House of Representatives,
are incorporated in the descriptive portions of this report.
Performance Goals and Objectives
Pursuant to clause 3(c)(4) of rule XIII of the Rules of the
House of Representatives, the goal of H.R. 976 is to repeal
Section 1071 of the Dodd-Frank Act to mandate the collection
and reporting of demographic data on small business loan
applicants.
Committee Cost Estimate
Clause 3(d)(1) of rule XIII of the Rules of the House of
Representatives requires an estimate and a comparison of the
costs that would be incurred in carrying out H.R. 976. The
Committee has requested but not received a cost estimate from
the Director of the Congressional Budget Office. However,
pursuant to clause 3(d)(1) of House rule XIII, the Committee
will adopt as its own the cost estimate by the Director of the
Congressional Budget Office once it has been prepared.
New Budget Authority and CBO Cost Estimate
With respect to the requirements of clause 3(c)(2) of rule
XIII of the Rules of the House of Representatives and section
308(a) of the Congressional Budget Act of 1974 and with respect
to requirements of clause 3(c)(3) of rule XIII of the Rules of
the House of Representatives and section 402 of the
Congressional Budget Act of 1974, a cost estimate was not made
available to the Committee in time for the filing of this
report. The Chairman of the Committee shall cause such estimate
to be printed in the Congressional Record upon its receipt by
the Committee.
Unfunded Mandates Statement
The Committee has requested but not received from the
Director of the Congressional Budget Office an estimate of the
Federal mandates pursuant to section 423 of the Unfunded
Mandates Reform Act. The Committee will adopt the estimate once
it has been prepared by the Director.
Earmark Statement
With respect to clause 9 of rule XXI of the Rules of the
House of Representatives, the Committee has carefully reviewed
the provisions of the resolution and states that the provisions
of the bill do not contain any congressional earmarks, limited
tax benefits, or limited tariff benefits within the meaning of
the rule.
Federal Advisory Committee Act Statement
No advisory committees within the meaning of section 5(b)
of the Federal Advisory Committee Act were created by this
legislation.
Applicability to the Legislative Branch
The Committee finds that the legislation does not relate to
the terms and conditions of employment or access to public
services or accommodations within the meaning of section
102(b)(3) of the Congressional Accountability Act.
Duplication of Federal Programs
Pursuant to clause 3(c)(5) of rule XIII of the Rules of the
House of Representatives, the Committee states that no
provision of the bill establishes or reauthorizes a program of
the Federal Government known to be duplicative of another
Federal program, including any program that was included in a
report to Congress pursuant to section 21 of the Public Law
111-139 or the most recent Catalog of Federal Domestic
Assistance.
Section-by-Section Analysis of the Legislation
Section 1. Short title
Section 1 provides the short title is the ``1071 Repeal to
Protect Small Business Lending Act.''
Section 2. Findings
Section 2 sets forth the following findings:
Section 704B of the Equal Credit Opportunity
Act, as added by section 1071 of the Dodd Frank Act,
imposes data collection and reporting requirements on
financial institutions regarding small business loans;
These requirements have resulted in
increased compliance costs for financial institutions,
potentially reducing access to credit for small
businesses;
The regulatory burdens created by these
requirements disproportionately impact smaller
financial institutions, such as community banks and
credit unions, which are critical to small business
lending; and
Repealing these requirements will reduce
regulatory barriers and support greater access to
credit for small businesses.
Section 3. Repeal of the small business loan data collection
requirements
Section 3 repeals section 1071 of the Dodd Frank Act.
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italics, and existing law in which no
change is proposed is shown in roman):
EQUAL CREDIT OPPORTUNITY ACT
TITLE VII--EQUAL CREDIT OPPORTUNITY
Sec.
* * * * * * *
[704B. Small business loan data collection.]
* * * * * * *
Sec. 701. Prohibited discrimination; reasons for adverse action
(a) It shall be unlawful for any creditor to discriminate
against any applicant, with respect to any aspect of a credit
transaction--
(1) on the basis of race, color, religion, national
origin, sex or marital status, or age (provided the
applicant has the capacity to contract);
(2) because all or part of the applicant's income
derives from any public assistance program; or
(3) because the applicant has in good faith exercised
any right under the Consumer Credit Protection Act.
(b) It shall not constitute discrimination for purposes of
this title for a creditor--
(1) to make an inquiry of marital status if such
inquiry is for the purpose of ascertaining the
creditor's rights and remedies applicable to the
particular extension of credit and not to discriminate
in a determination of credit-worthiness;
(2) to make an inquiry of the applicant's age or of
whether the applicant's income derives from any public
assistance program if such inquiry is for the purpose
of determining the amount and probable continuance of
income levels, credit history, or other pertinent
element of credit-worthiness as provided in regulations
of the Board;
(3) to use any empirically derived credit system
which considers age if such system is demonstrably and
statistically sound in accordance with regulations of
the Bureau, except that in the operation of such system
the age of an elderly applicant may not be assigned a
negative factor or value; or
(4) to make an inquiry or to consider the age of an
elderly applicant when the age of such applicant is to
be used by the creditor in the extension of credit in
favor of such applicant[; or].
[(5) to make an inquiry under section 704B, in
accordance with the requirements of that section.]
(c) It is not a violation of this section for a creditor to
refuse to extend credit offered pursuant to--
(1) any credit assistance program expressly
authorized by law for an economically disadvantaged
class of persons;
(2) any credit assistance program administered by a
nonprofit organization for its members or an
economically disadvantaged class of persons; or
(3) any special purpose credit program offered by a
profit-making organization to meet special social needs
which meets standards prescribed in regulations by the
Board;
if such refusal is required by or made pursuant to such
program.
(d)(1) Within thirty days (or such longer reasonable time as
specified in regulations of the Bureau for any class of credit
transaction) after receipt of a completed application for
credit, a creditor shall notify the applicant of its action on
the application.
(2) Each applicant against whom adverse action is taken shall
be entitled to a statement of reasons for such action from the
creditor. A creditor satisfies this obligation by--
(A) providing statements of reasons in writing as a
matter of course to applicants against whom adverse
action is taken; or
(B) giving written notification of adverse action
which discloses (i) the applicant's right to a
statement of reasons within thirty days after receipt
by the creditor of a request made within sixty days
after such notification, and (ii) the identity of the
person or office from which such statement may be
obtained. Such statement may be given orally, if the
written notification advises the applicant of his right
to have the statement of reasons confirmed in writing
on written request.
(3) A statement of reasons meets the requirements of this
section only if it contains the specific reasons for the
adverse action taken.
(4) Where a creditor has been requested by a third party to
make a specific extension of credit directly or indirectly to
an applicant, the notification and statement of reasons
required by this subsection may be made directly by such
creditor, or indirectly through the third party, provided in
either case that the identity of the creditor is disclosed.
(5) The requirements of paragraphs (2), (3), or (4) may be
satisfied by verbal statements or notifications in the case of
any creditor who did not act on more than one hundred and fifty
applications during the calendar year preceding the calendar
year in which the adverse action is taken, as determined under
regulations of the Board.
(6) For purposes of this subsection, the term ``adverse
action'' means a denial or revocation of credit, a change in
the terms of an existing credit arrangement, or a refusal to
grant credit in substantially the amount or on substantially
the terms requested. Such term does not include a refusal to
extend additional credit under an existing credit arrangement
where the applicant is delinquent or otherwise in default, or
where such additional credit would exceed a previously
established credit limit.
(e) Copies Furnished to Applicants.--
(1) In general.--Each creditor shall furnish to an
applicant a copy of any and all written appraisals and
valuations developed in connection with the applicant's
application for a loan that is secured or would have
been secured by a first lien on a dwelling promptly
upon completion, but in no case later than 3 days prior
to the closing of the loan, whether the creditor grants
or denies the applicant's request for credit or the
application is incomplete or withdrawn.
(2) Waiver.--The applicant may waive the 3 day
requirement provided for in paragraph (1), except where
otherwise required in law.
(3) Reimbursement.--The applicant may be required to
pay a reasonable fee to reimburse the creditor for the
cost of the appraisal, except where otherwise required
in law.
(4) Free copy.--Notwithstanding paragraph (3), the
creditor shall provide a copy of each written appraisal
or valuation at no additional cost to the applicant.
(5) Notification to applicants.--At the time of
application, the creditor shall notify an applicant in
writing of the right to receive a copy of each written
appraisal and valuation under this subsection.
(6) Valuation defined.--For purposes of this
subsection, the term ``valuation'' shall include any
estimate of the value of a dwelling developed in
connection with a creditor's decision to provide
credit, including those values developed pursuant to a
policy of a government sponsored enterprise or by an
automated valuation model, a broker price opinion, or
other methodology or mechanism.
* * * * * * *
[SEC. 704B. SMALL BUSINESS LOAN DATA COLLECTION.
[(a) Purpose.--The purpose of this section is to facilitate
enforcement of fair lending laws and enable communities,
governmental entities, and creditors to identify business and
community development needs and opportunities of women-owned,
minority-owned, and small businesses.
[(b) Information Gathering.--Subject to the requirements of
this section, in the case of any application to a financial
institution for credit for women-owned, minority-owned, or
small business, the financial institution shall--
[(1) inquire whether the business is a women-owned,
minority-owned, or small business, without regard to
whether such application is received in person, by
mail, by telephone, by electronic mail or other form of
electronic transmission, or by any other means, and
whether or not such application is in response to a
solicitation by the financial institution; and
[(2) maintain a record of the responses to such
inquiry, separate from the application and accompanying
information.
[(c) Right To Refuse.--Any applicant for credit may refuse to
provide any information requested pursuant to subsection (b) in
connection with any application for credit.
[(d) No Access by Underwriters.--
[(1) Limitation.--Where feasible, no loan underwriter
or other officer or employee of a financial
institution, or any affiliate of a financial
institution, involved in making any determination
concerning an application for credit shall have access
to any information provided by the applicant pursuant
to a request under subsection (b) in connection with
such application.
[(2) Limited access.--If a financial institution
determines that a loan underwriter or other officer or
employee of a financial institution, or any affiliate
of a financial institution, involved in making any
determination concerning an application for credit
should have access to any information provided by the
applicant pursuant to a request under subsection (b),
the financial institution shall provide notice to the
applicant of the access of the underwriter to such
information, along with notice that the financial
institution may not discriminate on the basis of such
information.
[(e) Form and Manner of Information.--
[(1) In general.--Each financial institution shall
compile and maintain, in accordance with regulations of
the Bureau, a record of the information provided by any
loan applicant pursuant to a request under subsection
(b).
[(2) Itemization.--Information compiled and
maintained under paragraph (1) shall be itemized in
order to clearly and conspicuously disclose--
[(A) the number of the application and the
date on which the application was received;
[(B) the type and purpose of the loan or
other credit being applied for;
[(C) the amount of the credit or credit limit
applied for, and the amount of the credit
transaction or the credit limit approved for
such applicant;
[(D) the type of action taken with respect to
such application, and the date of such action;
[(E) the census tract in which is located the
principal place of business of the women-owned,
minority-owned, or small business loan
applicant;
[(F) the gross annual revenue of the business
in the last fiscal year of the women-owned,
minority-owned, or small business loan
applicant preceding the date of the
application;
[(G) the race, sex, and ethnicity of the
principal owners of the business; and
[(H) any additional data that the Bureau
determines would aid in fulfilling the purposes
of this section.
[(3) No personally identifiable information.--In
compiling and maintaining any record of information
under this section, a financial institution may not
include in such record the name, specific address
(other than the census tract required under paragraph
(1)(E)), telephone number, electronic mail address, or
any other personally identifiable information
concerning any individual who is, or is connected with,
the women-owned, minority-owned, or small business loan
applicant.
[(4) Discretion to delete or modify publicly
available data.--The Bureau may, at its discretion,
delete or modify data collected under this section
which is or will be available to the public, if the
Bureau determines that the deletion or modification of
the data would advance a privacy interest.
[(f) Availability of Information.--
[(1) Submission to bureau.--The data required to be
compiled and maintained under this section by any
financial institution shall be submitted annually to
the Bureau.
[(2) Availability of information.--Information
compiled and maintained under this section shall be--
[(A) retained for not less than 3 years after
the date of preparation;
[(B) made available to any member of the
public, upon request, in the form required
under regulations prescribed by the Bureau;
[(C) annually made available to the public
generally by the Bureau, in such form and in
such manner as is determined by the Bureau, by
regulation.
[(3) Compilation of aggregate data.--The Bureau may,
at its discretion--
[(A) compile and aggregate data collected
under this section for its own use; and
[(B) make public such compilations of
aggregate data.
[(g) Bureau Action.--
[(1) In general.--The Bureau shall prescribe such
rules and issue such guidance as may be necessary to
carry out, enforce, and compile data pursuant to this
section.
[(2) Exceptions.--The Bureau, by rule or order, may
adopt exceptions to any requirement of this section and
may, conditionally or unconditionally, exempt any
financial institution or class of financial
institutions from the requirements of this section, as
the Bureau deems necessary or appropriate to carry out
the purposes of this section.
[(3) Guidance.--The Bureau shall issue guidance
designed to facilitate compliance with the requirements
of this section, including assisting financial
institutions in working with applicants to determine
whether the applicants are women-owned, minority-owned,
or small businesses for purposes of this section.
[(h) Definitions.--For purposes of this section, the
following definitions shall apply:
[(1) Financial institution.--The term ``financial
institution'' means any partnership, company,
corporation, association (incorporated or
unincorporated), trust, estate, cooperative
organization, or other entity that engages in any
financial activity.
[(2) Small business.--The term ``small business'' has
the same meaning as the term ``small business concern''
in section 3 of the Small Business Act (15 U.S.C. 632).
[(3) Small business loan.--The term ``small business
loan'' means a loan made to a small business.
[(4) Minority.--The term ``minority'' has the same
meaning as in section 1204(c)(3) of the Financial
Institutions Reform, Recovery, and Enforcement Act of
1989.
[(5) Minority-owned business.--The term ``minority-
owned business'' means a business--
[(A) more than 50 percent of the ownership or
control of which is held by 1 or more minority
individuals; and
[(B) more than 50 percent of the net profit
or loss of which accrues to 1 or more minority
individuals.
[(6) Women-owned business.--The term ``women-owned
business'' means a business--
[(A) more than 50 percent of the ownership or
control of which is held by 1 or more women;
and
[(B) more than 50 percent of the net profit
or loss of which accrues to 1 or more women.]
* * * * * * *
----------
DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION ACT
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Dodd-Frank
Wall Street Reform and Consumer Protection Act''.
(b) Table of Contents.--The table of contents for this Act is
as follows:
Sec. 1. Short title; table of contents.
* * * * * * *
TITLE X--BUREAU OF CONSUMER FINANCIAL PROTECTION
* * * * * * *
Subtitle G--Regulatory Improvements
[Sec. 1071. Small business data collection.]
* * * * * * *
TITLE X--BUREAU OF CONSUMER FINANCIAL PROTECTION
* * * * * * *
Subtitle G--Regulatory Improvements
[SEC. 1071. SMALL BUSINESS DATA COLLECTION.
[(a) In General.--The Equal Credit Opportunity Act (15 U.S.C.
1691 et seq.) is amended by inserting after section 704A the
following:
[``SEC. 704B. SMALL BUSINESS LOAN DATA COLLECTION.
[``(a) Purpose.--The purpose of this section is to facilitate
enforcement of fair lending laws and enable communities,
governmental entities, and creditors to identify business and
community development needs and opportunities of women-owned,
minority-owned, and small businesses.
[``(b) Information Gathering.--Subject to the requirements of
this section, in the case of any application to a financial
institution for credit for women-owned, minority-owned, or
small business, the financial institution shall--
[``(1) inquire whether the business is a women-owned,
minority-owned, or small business, without regard to
whether such application is received in person, by
mail, by telephone, by electronic mail or other form of
electronic transmission, or by any other means, and
whether or not such application is in response to a
solicitation by the financial institution; and
[``(2) maintain a record of the responses to such
inquiry, separate from the application and accompanying
information.
[``(c) Right To Refuse.--Any applicant for credit may refuse
to provide any information requested pursuant to subsection (b)
in connection with any application for credit.
[``(d) No Access by Underwriters.--
[``(1) Limitation.--Where feasible, no loan
underwriter or other officer or employee of a financial
institution, or any affiliate of a financial
institution, involved in making any determination
concerning an application for credit shall have access
to any information provided by the applicant pursuant
to a request under subsection (b) in connection with
such application.
[``(2) Limited access.--If a financial institution
determines that a loan underwriter or other officer or
employee of a financial institution, or any affiliate
of a financial institution, involved in making any
determination concerning an application for credit
should have access to any information provided by the
applicant pursuant to a request under subsection (b),
the financial institution shall provide notice to the
applicant of the access of the underwriter to such
information, along with notice that the financial
institution may not discriminate on the basis of such
information.
[``(e) Form and Manner of Information.--
[``(1) In general.--Each financial institution shall
compile and maintain, in accordance with regulations of
the Bureau, a record of the information provided by any
loan applicant pursuant to a request under subsection
(b).
[``(2) Itemization.--Information compiled and
maintained under paragraph (1) shall be itemized in
order to clearly and conspicuously disclose--
[``(A) the number of the application and the
date on which the application was received;
[``(B) the type and purpose of the loan or
other credit being applied for;
[``(C) the amount of the credit or credit
limit applied for, and the amount of the credit
transaction or the credit limit approved for
such applicant;
[``(D) the type of action taken with respect
to such application, and the date of such
action;
[``(E) the census tract in which is located
the principal place of business of the women-
owned, minority-owned, or small business loan
applicant;
[``(F) the gross annual revenue of the
business in the last fiscal year of the women-
owned, minority-owned, or small business loan
applicant preceding the date of the
application;
[``(G) the race, sex, and ethnicity of the
principal owners of the business; and
[``(H) any additional data that the Bureau
determines would aid in fulfilling the purposes
of this section.
[``(3) No personally identifiable information.--In
compiling and maintaining any record of information
under this section, a financial institution may not
include in such record the name, specific address
(other than the census tract required under paragraph
(1)(E)), telephone number, electronic mail address, or
any other personally identifiable information
concerning any individual who is, or is connected with,
the women-owned, minority-owned, or small business loan
applicant.
[``(4) Discretion to delete or modify publicly
available data.--The Bureau may, at its discretion,
delete or modify data collected under this section
which is or will be available to the public, if the
Bureau determines that the deletion or modification of
the data would advance a privacy interest.
[``(f) Availability of information.--
[``(1) Submission to bureau.--The data required to be
compiled and maintained under this section by any
financial institution shall be submitted annually to
the Bureau.
[``(2) Availability of information.--Information
compiled and maintained under this section shall be--
[``(A) retained for not less than 3 years
after the date of preparation;
[``(B) made available to any member of the
public, upon request, in the form required
under regulations prescribed by the Bureau;
[``(C) annually made available to the public
generally by the Bureau, in such form and in
such manner as is determined by the Bureau, by
regulation.
[``(3) Compilation of aggregate data.--The Bureau
may, at its discretion--
[``(A) compile and aggregate data collected
under this section for its own use; and
[``(B) make public such compilations of
aggregate data.
[``(g) Bureau Action.--
[``(1) In general.--The Bureau shall prescribe such
rules and issue such guidance as may be necessary to
carry out, enforce, and compile data pursuant to this
section.
[``(2) Exceptions.--The Bureau, by rule or order, may
adopt exceptions to any requirement of this section and
may, conditionally or unconditionally, exempt any
financial institution or class of financial
institutions from the requirements of this section, as
the Bureau deems necessary or appropriate to carry out
the purposes of this section.
[``(3) Guidance.--The Bureau shall issue guidance
designed to facilitate compliance with the requirements
of this section, including assisting financial
institutions in working with applicants to determine
whether the applicants are women-owned, minority-owned,
or small businesses for purposes of this section.
[``(h) Definitions.--For purposes of this section, the
following definitions shall apply:
[``(1) Financial institution.--The term `financial
institution' means any partnership, company,
corporation, association (incorporated or
unincorporated), trust, estate, cooperative
organization, or other entity that engages in any
financial activity.
[``(2) Small business.--The term `small business' has
the same meaning as the term `small business concern'
in section 3 of the Small Business Act (15 U.S.C. 632).
[``(3) Small business loan.--The term `small business
loan' means a loan made to a small business.
[``(4) Minority.--The term `minority' has the same
meaning as in section 1204(c)(3) of the Financial
Institutions Reform, Recovery, and Enforcement Act of
1989.
[``(5) Minority-owned business.--The term `minority-
owned business' means a business--
[``(A) more than 50 percent of the ownership
or control of which is held by 1 or more
minority individuals; and
[``(B) more than 50 percent of the net profit
or loss of which accrues to 1 or more minority
individuals.
[``(6) Women-owned business.--The term `women-owned
business' means a business--
[``(A) more than 50 percent of the ownership
or control of which is held by 1 or more women;
and
[``(B) more than 50 percent of the net profit
or loss of which accrues to 1 or more women.''.
[(b) Technical and Conforming Amendments.--Section 701(b) of
the Equal Credit Opportunity Act (15 U.S.C. 1691(b)) is
amended--
[(1) in paragraph (3), by striking ``or'' at the end;
[(2) in paragraph (4), by striking the period at the
end and inserting ``; or''; and
[(3) by inserting after paragraph (4), the following:
[``(5) to make an inquiry under section 704B, in
accordance with the requirements of that section.''.
[(c) Clerical Amendment.--The table of sections for title VII
of the Consumer Credit Protection Act is amended by inserting
after the item relating to section 704A the following new item:
[``704B. Small business loan data collection.''.
[(d) Effective Date.--This section shall become effective on
the designated transfer date.]
* * * * * * *
MINORITY VIEWS
H.R. 976 would repeal Section 1071 of the Dodd-Frank Wall
Street Reform and Consumer Protection Act (Dodd-Frank). This
provision requires lenders to collect and report small business
lending data to the Consumer Financial Protection Bureau
(CFPB), similar to how lenders have collected and reported
mortgage loan data for decades under the Home Mortgage
Disclosure Act (HMDA). This approach promotes transparency in a
manner that would help reduce lending costs, expand credit
availability, and prevent discrimination for entrepreneurs
across the country. The CFPB issued a final rule in 2023
implementing Section 1071 pursuant to a court-supervised
settlement, and exempted community financial institutions that
provide little to no small business loans. Republicans passed a
Congressional Review Act resolution that would have rescinded
CFPB's rule, however President Biden vetoed the measure.
In March 2023, the CFPB finalized a rule implementing
Section 1071 of Dodd-Frank,\1\ aimed at increasing transparency
in small business lending, promoting competition among lenders
that would drive down costs for borrowers, and providing new
lending opportunities for small businesses, especially women-
owned, LGBTQ-owned businesses and businesses owned by people of
color. CFPB's Section 1071 rule requires lenders to collect and
report information about the small business credit applications
they receive, including geographic and demographic data (that's
self-reported by business owners on a voluntary basis), lending
decisions, and the price of credit. The rule would work in
tandem with the Community Reinvestment Act, which requires
certain financial institutions to meet the needs of the
communities they serve. The increased transparency will benefit
small businesses, family farms, financial institutions, and the
broader economy.
---------------------------------------------------------------------------
\1\CFPB, Small business lending rulemaking (Accessed June 8, 2023).
---------------------------------------------------------------------------
Arguably, had CFPB's Section 1071 rulemaking been in place
before the pandemic, policymakers would have been able to not
only design relief programs that were better targeted, but also
to better monitor which small businesses were receiving support
and which were left out of programs like the Paycheck
Protection Program (PPP). Industry studies also affirm how
important fair lending rules are to the nation's economic
virtuality. For instance, one Citigroup study estimates that
fair access to lending for Black-owned small businesses alone
would have resulted in $650 billion in additional business
revenue per year, as well as created an additional 6.1 million
jobs per year.\2\ Moreover, the CFPB conducted a pilot study in
2024 where they found that Black-owned small businesses
received disparate treatment compared to White-owned small
businesses by the same bank, finding that Black participants
received less encouragement to apply for a loan and were more
likely to be steered into alternative credit products, like a
home equity credit product where the owner's personal residence
would be at risk if they default on the loan.\3\
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\2\Citigroup, Closing the Racial Inequality Gaps: The Economic Cost
of Black Inequality in the U.S. (Sep. 2020).
\3\CFPB, CFPB Pilot Study Finds Differential Treatment in Small
Business Lending Markets (Nov. 13, 2024).
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Since its finalization, Section 1071 has come under attack
both in district courts and Congress. In May 2023, plaintiffs
filed a lawsuit in a Texas federal district court challenging
the validity of the rule and a motion seeking a preliminary
injunction.\4\ However, community lenders\5\ and small business
advocates alike have underlined the importance of CFPB's small
lending rules in creating a more transparent and fairer
marketplace for lenders and small businesses. It is also likely
that rules shining a light on small business lending will
likely result in increased lending to underserved businesses,
including farms, as was observed in the implementation of
similar sunshine statutes like HMDA. In fact, changes to HMDA
data in 1990 and 1993 corresponded with a 70% increase in
conventional home purchase lending to Black borrowers, and a
48% increase in lending to Latinx borrowers, from 1993 to
1995.\6\
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\4\John L. Culhane, Jr., Richard J. Andreano, Jr. & Michael Gordon,
Plaintiffs challenging Section 1071 final rule seek preliminary
injunction; Ballard Spahr to hold June 15 webinar, Ballard Spahr
(accessed Jun, 8, 2023).
\5\Accion Opportunity Fund, CEO Luz Urrutia's Congressional
Testimony on Lending Transparency (Mar. 2023).
\6\NCRC, Home Loans to Minorities and Low- and Moderate-Income
Borrowers Increase in the 1990s, but then Fall in 2001: A Review of
National Data Trends from 1993 to 2001 (Apr. 2023).
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Rep. Nydia Velazquez, Ranking Member of the House Small
Business Committee, offered an amendment that would stipulate
the bill only takes effect after the CFPB Director certifies
that the small business lending market is competitive,
transparent, and fair, and that small business lenders are
providing Truth In Lending Act (TILA) type disclosures to
prospective borrowers, and that lenders are not burying
predatory confessions of judgement provisions in small business
loan contracts. Republicans rejected the amendment in a party-
line vote.
More than 150 civil rights, consumer, small business,
lending, religious, and community organizations have strongly
opposed efforts, like H.R. 976, to repeal and undermine Section
1071 of Dodd-Frank.\7\ This includes National Community
Reinvestment Coalition, 20/20 Vision, Access Plus Capital,
Accountable.US, African American Alliance of CDFI CEOs,
Alliance 85, Inc., American Economic Liberties Project,
Americans for Financial Reform, Anacostia Economic Development
Corporation, ANHD--The, Association for Neighborhood & Housing
Development, Avenue CDC, BBIF, Inc., Birmingham Business
Resource Center, Bridgeport Neighborhood Trust, Brotherhood and
Sisterhood International, Building Alabama Reinvestment,
CAARMA, California Capital, Financial Development Corporation,
California Community Economic Development Association, CAMEO--
California Association for Micro Enterprise Opportunity, Camino
Financial, Inc., CASA of Oregon, Cash Community Development
Organization, Catapult Pittsburgh, Catholic Charities USA, CDC
Small Business Finance, Ceiba, Center for Responsible Lending,
Centre for Homeownership & Economic Development Corporation,
Centro Cultural, Chicago Community Loan Fund, CHWC Inc., City
of Gary, IN, City of Tampa, CLARIFI, Coalition for Non Profit
Housing and Economic Development, Coastal Enterprises, Inc.,
Community Enterprise Investments, Inc., Community Growth Fund,
Community Housing Development Corporation, Community Link,
Community Reinvestment Alliance of South Florida, Consumer
Action, Consumer Federation of America, Delaware Community
Reinvestment Action Council, Inc., Demand Progress, Divine
Direction, Economic Action Maryland, Economic Growth
Corporation, Empire Justice Center, ExploreUSTV and Travel,
Fair Finance Watch, Fair Housing Center of Metropolitan
Detroit, Fair Housing Center of Southwest Michigan, Famicos
Foundation, Family Resources of New Orleans, FHCNA, First
Community Capital, Frayser Community Development Corporation,
Gen-Wealth Empowerment, Georgia Advancing Communities Together,
Inc., Greater Cincinnati Microenterprise Initiative, Habitat
For Humanity of Michigan, Hawai`I Alliance for Community-Based
Economic Development, HEAL Food Alliance, Henderson and
Company, Home Ownership Center of Greater Cincinnati, Homes on
the Hill, CDC, Housing and Education Alliance, Inc. (HEA),
Housing, Education and Economic Development, Housing Justice
Center, Housing Options & Planning Enterprises, Inc.,
HousingWorks RI, I Give Back USA, IGNITE! Alabama, Interfaith
Center on Corporate Responsibility, Jewish Community Action,
JOVIS, Latino Economic Development Center, Latino Leadership
Council, Latino Policy Council, Legacy Foundation, Legal Aid
Society of San Diego, LINC UP Nonprofit Housing Corporation,
Local First Arizona, Local Initiatives Support Corporation
(LISC), Logan Heights Community Development Corporation, Main
Street Alliance, Massachusetts Action for Justice,
Massachusetts Affordable Housing Alliance, Memorial CDC, Metro
Milwaukee Fair Housing Council, Metro North Community
Development Corporation, Metropolitan Milwaukee Fair Housing
Council, Metropolitan St. Louis Equal Housing and Opportunity
Council, MS Communities United for Prosperity (MCUP), MY
Project USA, National Association for Latino Community Asset
Builders, National Association of American Veterans, Inc.,
National Coalition for Asian Pacific American Community
Development (National CAPACD), Native Community Capital,
National NeighborWorks Association, National Urban League, NCRC
CDF, Neighborhood Improvement Association, NeighborWorks
Southern Colorado, New Future Foundation, New Hope Community
Development, New Jersey Citizen Action, New Jersey Institute
for Social Justice, New Mexico Community Capital, New York
StateWide Senior Action Council, Nichols Temple AME Ministries,
North Carolina Housing Coalition, Inc., Northwest Indiana
Reinvestment Alliance, Olive Hill Community Economic
Development Corporation, Inc, Opportunity Finance Network,
Over-the-Rhine Community Housing, Philadelphia Association of
Community Development Corporations, Pima County Community Land
Trust, Pittsburgh Community Reinvestment Group, Prosperity
Indiana, Public Citizen, Public Good Law Center, REBOUND, Inc.,
Reinvestment Partners, Responsible Business Lending Coalition,
Revolving Door Project, Rise Economy, River Cities Development
Services, River City Housing, Inc., Roosevelt, Southwest
Community Development Corporation, San Joaquin Valley Housing
Collaborative, SaverLife, Self-Help Enterprises, SLEHCRA, Small
Business Majority, South Dallas Fair Park Innercity Community
Development Corporation, South Florida Community Development
Coalition, Southern Dallas Progress Community Development
Corporation, Southwest CDC, Southwest Economic Solutions,
Southwest Georgia United, Southwest Neighborhood Housing
Services, The Food Trust, The Greenlining Institute, The
National Council of Asian Pacific Americans (NCAPA), The
Sacramento Environmental Justice Coalition, Tierra del Sol
Housing Corporation, Town of Apex, Ubuntu Institute of
Learning, UIC Law School, Universal Housing Solutions CDC,
Urban Economic Development Association of Wisconsin (UEDA),
Urban Land Conservancy, Utah Housing Coalition, Vermont Slauson
LDC, Washington Area Community Investment Fund, Welfare Reform
Liaison Project, Inc., Wisconsin Black Chamber of Commerce,
Inc, With Action, Woodstock Institute, Working In
Neighborhoods, and Working Solutions CDFI.
---------------------------------------------------------------------------
\7\LCCHR, Leadership Conference Opposes Bills to Undermine Small
Business and Civil Rights Data Law (Feb. 4, 2025); and NCRC, Support
for the CFPB's Final Rule Related to Section 1071 of the Dodd-Frank
Wall Street Reform and Consumer Protection Act (Jul. 25, 2023).
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For these reasons, we oppose H.R. 976.
Sincerely,
Maxine Waters,
Ranking Member.
Brad Sherman,
David Scott,
Emanuel Cleaver, II,
Joyce Beatty,
Ayanna Pressley,
Gregory W. Meeks,
Al Green,
Bill Foster,
Juan Vargas,
Rashida Tlaib,
Sylvia R. Garcia,
Nikema Williams,
Members of Congress.
[all]