Jefford's Shift Changes Congressional Agenda
May 30, 2001
The tax bill may well be President Bush's last major legislative success of the session. Senator Jim Jeffords' (R-VT) decision to become an Independent has led to a realignment in the Senate that will also change the issues we face on Capitol Hill this year. Senate Banking Committee ranking member Paul Sarbanes (D-MD) - the incoming chairman of the committee - wasted no time last week in laying out his vision and legislative agenda. Senator Sarbanes emphasized consumer and investor protection in a press briefing, and underscored plans to examine both predatory lending and financial privacy, two issues that outgoing Banking Chairman Phil Gramm (R-TX) had made clear he had no interest in pursuing. On the issue of privacy, Senator Sarbanes said he wanted to reopen a debate that appeared permanently closed under Gramm, namely whether financial companies should have to obtain a customer "opt-in" for sharing certain personal information. It would be difficult to obtain positive permission from a consumer to share their information.
With respect to predatory lending - an issue on which Senator Gramm has been especially dismissive - Sarbanes said there is a place for conscientious subprime lenders, and indicated he wanted only to get at those he considered bad actors. As chairman, Sarbanes said he would emphasize the committee's oversight responsibilities. He also plans to reinvigorate the committee's urban affairs jurisdiction. Senator Sarbanes did not mention RESPA as an agenda item, but there has been a concerted effort by the Mortgage Bankers Association of America to promote RESPA as a solution to predatory lending.
In light of Jeffords' announcement, it will to take some time for the Senate to transition to a Democratic majority. Because of this, the timing of legislative action on any of these items is uncertain. Further, the Senate still has only a one vote margin, and the balance could easily shift again. In addition, since the House remains in Republican control, the House Financial Services Committee may well counterbalance Senator Sarbanes' efforts. ALTA will keep you posted on these issues and how this change will affect our industry. Details: Ann vom Eigen, ALTA Legislative/Regulatory Counsel, firstname.lastname@example.org.