House Passes "Midnight Rules Relief" Act
Commentary by Steven Lofchie
The US House of Representatives passed a bill to allow "Congress to disapprove multiple regulations under one joint resolution of disapproval if the regulations were submitted for review during a portion of the final year of a President's term."
The bill, H.R.77, cited as the "Midnight Rules Relief Act," was introduced by Andy Biggs and provides for "en bloc consideration in resolutions of disapproval for 'midnight rules.'"
In remarks on the House floor, Financial Services Committee Chair French Hill condemned the "plethora of midnight rulemakings we saw at the end of the Biden-Harris Administration" and targeted the CFPB as the 'worst offender' and the 'poster child of the midnight rulemaking renegade.'" He criticized former CFPB Director Rohit Chopra for spearheading an "avalanche of relentless rulemakings," despite congressional warnings to halt regulatory actions at the end of a presidential term. (See related coverage.)
Chair Hill singled out two specific rulemakings:
- A cap on overdraft fees, which, he argued, amounts to government price controls that limit consumer financial choices. (Chair Hill and Senate Banking Committee Chair Tim Scott introduced a Congressional Review Act resolution to overturn this final rule.)
- A rule preventing medical debt from being included in credit reports, which he warned would raise healthcare costs and reduce access to care, particularly in rural communities.
Chair Hill emphasized his commitment to roll back regulatory overreach.
Commentary
The CFPB's post-election rulemaking efforts, and Mr. Chopra's own decision to stay at the agency past the start of the new Administration, were emblematic of a regulator that believed his view of good public policy trumped the decision of voters. (See also, Rohit Chopra Ousted as CFPB Director; CFPB Proposes Rule to Prohibit "One-Sided Terms" in Consumer Contracts.)
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The House Financial Services Committee urged regulatory agencies "to preserve information and refrain from partisan rulemaking as a new administration enters."
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The CFPB adopted a final rule to limit overdraft charges at large banks and credit unions. The agency stated that the new rule "closes the large bank regulatory loophole that exempted overdraft fees as a finance charge."