The Senate was divided over an amended budget bill provision proposing severe cuts to the Consumer Financial Protection Bureau’s (CFPB) annual funding ahead of its vote to pass the measure July 1, with Vice President J.D. Vance casting the tie-breaking vote.
If the bill were adopted into law in its current state, the provision would cut the bureau’s annual budget limit nearly in half as an alternative to a previous proposal that would have effectively defunded the agency.
The substitute provision would lower the cap on the bureau’s maximum annual fund requests from 12 percent to 6.5 percent of the equivalent of the Federal Reserve’s inflation-adjusted profits in 2009.
Elizabeth MacDonough, who has served as Senate parliamentarian since 2012, rejected Republicans’ original proposal to set the CFPB’s funding cap at zero as part of the “budget package.
The updated CFPB funding provision was cleared by MacDonough to be included in the budget package. It will be exempt from a filibuster – meaning it needs only a simple majority to pass. This is good news for Republicans who support drastic cuts to the bureau’s funding but has caused pushback from Democrats and various advocacy groups.
“After working closely with my colleagues on the committee and across the Republican conference, as well as the Senate parliamentarian, we’re in a position to advance legislation that helps deliver on President Trump’s mandate to cut waste and duplication in our federal government and save hardworking taxpayer dollars,” Senate Banking Committee Chair Tim Scott (R-S.C.) said in a statement. “The committee’s language decreases the Consumer Financial Protection Bureau’s funding cap without affecting the statutory functions of the bureau.”
Sen. Elizabeth Warren (D-Mass.), the banking committee’s ranking member, spoke out in sharp opposition to the revised proposal and vowed Democrats would “fight back” with an amendment aimed at preserving the CFPB’s statutory funding level as set by the Dodd-Frank Act.
“The CFPB has returned over $21 billion to more than 205 million Americans who were cheated by big banks and giant corporations,” Warren said in a statement. “That is why this agency is popular across the country. But, from the beginning, Republicans in Congress have been trying to kill it, and now they want to slash the CFPB’s modest funding cap almost in half.”
Warren urged her Democratic colleagues to “vote yes to support the CFPB, the little agency that fights for all Americans.”
Nearly 200 organizations representing consumer advocates, civil rights advocates, labor advocates and others wrote to Senate leaders, urging them to oppose measures aimed at cutting the agency’s budget. The organizations highlighted the number of people helped by the CFPB’s actions to hold bad actors accountable while protecting people from unfair, deceptive and abusive practices.
“Since it opened its doors in 2011, the CFPB has been fighting rip-offs, junk fees, fraud, and unfair treatment,” the organizations wrote. “The CFPB’s supervision and enforcement has held firms accountable for violating consumer protection and civil rights laws, helped families save their homes, and made financial markets fairer, safer, and more transparent. It has returned more than $21 billion to 200 million people through its enforcement actions and saved families many tens of billions of dollars more by implementing common-sense safeguards that keep more money in people’s pockets every day. Much has been accomplished, and there is much more to do.”
If Democrats are to continue their efforts to eliminate the measure cutting CFPB funding, they will have to do so in the House.