A handful of moderate Democrats supported a controversial bill to restructure the Consumer Financial Protection Bureau, helping the House Financial Services Committee approve the legislation.
The debate highlights a growing divide among some party moderates and more progressive lawmakers who remain opposed to changing core aspects of the Dodd-Frank Act. The Financial Product Safety Commission Act would establish a five-person board structure, replacing the single director currently at the helm of the consumer agency.
"A bipartisan commission is common throughout the federal government," said Rep. Randy Neugebauer, R-Texas, a lead sponsor of the bill. "A bipartisan leadership structure can help address regulatory imbalances, imperfections or in some circumstances, political policy decisions."
The legislation includes a provision that the transition is effective when three out of five commissioners have been named by the president and confirmed by the Senate. The measure also sets aside $75 million in surplus funds from the Federal Reserve banks to pay for the commission over ten years. The banking panel debated the bill on Wednesday, and passed it 35 to 24.
Three Democrats, Reps. Kyrsten Sinema of Arizona, David Scott of Georgia and Brad Ashford of Nebraska, are cosponsors on the legislation, along with 45 GOP lawmakers. Scott and Sinema were the only two Democrats to support the bill (Ashford is not on the panel) but several other Democrats suggested the general idea of a commission structure.
"To my mind, a commission structure directionally could be the right way to govern an organization like the CFPB, provided the commission is structured appropriately and the transition from a director to the commission is done successfully," said Rep. John Delaney, D-Md.
Delaney said a commission could provide "better continuity" between presidential administrations, help make the agency less politicized and allow for "a more enduring entity."
He offered but withdrew an amendment that would require all five commissioners to be confirmed before the change is effective and allow the director at the time to sit on the commission. He and Neugebauer said they would continue to discuss the issue, including any constitutional concerns with permitting the director to join the commission.
The partisan shift is a change from the last Congress, when a similar bill was approved in November 2013 along party lines.
The measure was later packaged with several other changes to the CFPB, including a more divisive move to subject the agency to Congressional appropriations, which passed the House 232-182. Ten Democrats voted for the measure, though that count includes none of the supporters this time around. Six of the Democratic members who voted for the bill last year are no longer serving in Congress.
Rep. Brad Sherman, D-Calif., meanwhile, added at the markup that he also worries about continuity issues during transitions at the White House, suggesting he could be supportive of the effort down the line.
"The purpose of this bill I fully understand — and that is we should not have the very controversial decisions that are made by the CFPB swing broadly back and forth from left to right based on who's elected president," he said.
At the same time, Sherman said he remained undecided about the impact of the measure in the long term. He added that the agency's current director is "doing a good job," the bill costs $75 million and isn't likely to be signed by President Obama.
He also cited ongoing efforts by Rep. Denny Heck, D-Wash., around another bipartisan bill addressing the structure of the agency. Neugebauer said that negotiations are ongoing between him and Heck.
