Proposals could have big impact on credit union industry, but Senate passage remains uncertain.
The House agreed on Wednesday to consider proposals to legalize marijuana banking and to give the National Credit Union Administration (NCUA) third-party vendor authority, along with several other amendments that would affect the financial services industry.
The House will debate those proposals as part of its version of the FY23 defense authorization bill, which is now on the floor. Because the defense bill is considered must-pass legislation, lawmakers have attempted to attach many unrelated amendments—making it a “Christmas Tree” measure, as it is known on Capitol Hill.
A rule approved on Wednesday afternoon governing debate on the bill will see the House consider some 650 amendments, many of which may be combined into a single amendment or not be offered at all.
As part of the debate, the House agreed to consider Rep. Ed Perlmutter’s, D-Colo., plan to grant a regulatory safe harbor for credit unions and banks that wish to provide financial services to marijuana-related businesses in states where cannabis is legal. Because marijuana is not legal on the federal level, credit unions and banks could currently face sanctions from federal regulators.
Perlmutter has succeeded in attaching his plan to several must-pass bills, but the Senate consistently has rejected those attempts. For instance, Perlmutter attached the proposal to the House version of last year’s defense authorization bill and the China competitiveness bill still in conference, but the Senate has refused to include the cannabis amendment in either.
Proposals Regarding the NCUA
The House also agreed to debate as part of the defense bill a proposal by Rep. Bill Foster, D-Ill., to provide the NCUA with power to oversee third-party vendors used by credit unions. The NCUA is the only prudential banking regulator that does not have that power and agency officials for several years have asked Congress to enact legislation to address this.
The House also will debate a proposal by House Financial Services Chairwoman Rep. Maxine Waters, D-Calif., to extend the pandemic-related changes to the NCUA’s Central Liquidity Facility through the end of 2023.
Among other things, the defense bill rule also allows the House to consider proposals to:
–Expand employment opportunities in financial services for people previously convicted of crimes. (The NCUA already has adopted a policy of easing employment for those people at credit unions.)
–Establish a grant program for states, nonprofit institutions and higher education institutions to promote diversity in the appraisal industry.
–Modify requirements for appraisers of Federal Housing Administration-insured mortgages to allow them to be state-supervised rather than state-licensed. (The proposal also would specify educational requirements for appraisers of single-family homes.)