House Democrats vote to reverse CRA rule
WASHINGTON — The House approved a resolution late Monday to overturn the Office of the Comptroller of the Currency’s rule to revamp the Community Reinvestment Act.
The House voted along party lines to reverse the rule. Democratic leaders in the chamber used statutory power granted to Congress to review new regulations within 60 legislative days of an agency's publishing a policy in the Federal Register.
The OCC's rule, which the agency finalized without support from any other bank regulator, has been popular among Democrats who say it will undermine the decades-old CRA law intended to combat redlining.
“I am deeply concerned that the OCC’s final rule will harm low-income and minority communities that are disproportionately suffering during this crisis, effectively turning the Community Reinvestment Act into the Community Disinvestment Act,” House Financial Services Committee Chairwoman Maxine Waters, D-Calif., said on the House floor Monday. “If this resolution is not adopted, we will have different rules for different banks, leading to regulatory arbitrage and a race to the bottom of weaker standards that will only hurt the people the law was intended to help.”
While the Congressional Review Act resolution sends a message of Democrats’ disapproval of the OCC’s plan, the Republican-controlled Senate is not expected to consider the measure.
“Clear metrics and better reporting will enable banks, regulators and the public to have a better understanding of CRA activities of individual banks and of cross-sections of the industry,” said Rep. Patrick McHenry, R-N.C, in opposition to the resolution Monday. “Consumers will be able to see that and understand the type of institution they’re banking with as well.”
The OCC, led by then-Comptroller of the Currency Joseph Otting, finalized its reform of the Community Reinvestment Act in late May, capping off a contentious rulemaking process that House Democrats frequently scrutinized.