Government Affairs Report | October 2021
FROM: Brett Scott, NIADA Vice President, Government Affairs
Infrastructure: As Congress returned from its recess last month, infrastructure – and the massive spending proposal Democrats want to tie to it – was still the biggest issue on the table.
At press time, the $1.2 trillion infrastructure bill that passed the Senate in August with bipartisan support was still on hold in the Democrat-controlled House as Speaker Nancy Pelosi hopes to pass it in conjunction with a $3.5 trillion budget reconciliation resolution for a wide range of social programs.
Pelosi scheduled a vote on the infrastructure bill for Sept. 27, but that date was still subject to change.
Meanwhile, Senate Democrats were working to hash out the scope of the White House-backed reconciliation package, as Sens. Kyrsten Sinema (D-Ariz.) and Joe Manchin (D-W.Va.) have expressed disapproval of the plan’s high cost.
While reconciliation means the proposal does not need the 60 votes required for most bills, it still needs a majority vote, and in a Senate split 50-50 between the parties, that means every Democrat needs to be on board to get it through.
President Biden met with both senators on Sept. 15 in an attempt to win their support.
House Democrats revealed details of their proposed tax increases to help pay for their plans, including top rates of 26.5 percent for corporations – up from the current 21 percent – 39.6 percent for individuals (up from 37 percent) and 25 percent for capital gains (up from 20 percent). A 3.8 percent surtax on net investment income would effectively raise the capital gains rate to 28.8 percent.
The House’s proposed increases are far less than those sought by President Biden, whose plan included maximums of 28 percent for corporations and 39.6 on capital gains.
H.R. 4773, Consumer Financial Protection Commission Act: NIADA was among 28 trade associations representing businesses and financial institutions that signed a letter to Rep. Blaine Luetkemeyer (R-Mo.), the ranking Republican on the House Consumer Protection and Financial Institutions Subcommittee, and his fellow members of the House Financial Services Committee in support of the Consumer Financial Protection Commission Act.
The bill would change the Consumer Financial Protection Bureau, currently controlled by a single director, to a bipartisan five-member commission similar to the Federal Trade Commission.
In the letter, NIADA and its fellow associations said such a commission would “provide a balanced and deliberative approach to supervision, regulation and enforcement by encouraging input from all stakeholders,” as well as creating more stability.
The bill is currently under consideration by the Financial Services Committee.
Georgetown University law professor Alvaro Bedoya has been nominated by President Biden for a seat on the Federal Trade Commission. If confirmed by the Senate, he would replace current commissioner Rohit Chopra, Biden’s nominee as director of the Consumer Financial Protection Bureau.
Bedoya, a specialist in privacy law and founder/director of Georgetown law school’s Center on Privacy and Technology, is known as a fierce privacy advocate with a focus on technology issues, such as privacy lapses by large online platforms.
Bedoya’s background fits with the aggressive enforcement agenda of new FTC chairwoman Lina Khan, who was named to that position in June.
Bedoya’s confirmation would likely clear the way for a Senate vote on Chopra’s CFPB nomination.
The President named Chopra as his choice to lead the bureau in February, and in March the Senate Banking Committee sent Chopra’s nomination to the full Senate without a recommendation after a contentious 12-12 party-line vote.
But a vote has not yet been scheduled as Democrats want to maintain their 3-2 majority on the five-member FTC by having Chopra’s replacement ready to step in immediately on his departure.
Rep. Lloyd Smucker (R-Pa.) met with independent dealers from Pennsylvania’s 11th congressional district in NIADA’s latest Coffee With Congress virtual event.
Coffee With Congress is a series of online conversations that give NIADA members the opportunity to talk to the U.S. representative from their district about what’s happening in Washington and ask questions about legislation and policies that could affect their businesses.
The conversation with Smucker, who is vice chairman of the National Republican Congressional Committee, drew positive feedback from attendees.
In a previous event, dealers met with Rep. Kim Schrier (D-Wash.), a key member of the House Energy and Commerce Committee who represents Washington’s eighth district.
If you’d like to have coffee with your congressional representative, let me know at firstname.lastname@example.org and we’ll be happy to try to arrange it.
Massachusetts: Credit Acceptance Corp., America’s largest subprime auto lender, agreed to pay $27.2 million to settle a lawsuit filed last year by state Attorney General Maura Healey.
The suit accused CAC of violating state consumer protection and debt collection laws with what Healey called “a variety of alleged unfair practices relating to the company’s role in the origination, collection and securitization of subprime auto loans.”
The funds will be paid into a trust, which will distribute payments to an estimated 3,000 Massachusetts consumers affected by those practices. Healey said the settlement is the largest of its kind with a subprime auto lender.
“Thousands of Massachusetts consumers, many of them first-time car buyers, put their faith in CAC to help them with an auto loan,” she said, “but were instead lured into high-cost loans, fell deeper in debt and even lost their vehicles.”
The settlement also requires CAC, which did not admit wrongdoing, to make changes to its loan handling practices and be more transparent with borrowers. That includes providing borrowers who purchase a vehicle service contract with a document that allows them to cancel the contract and receive a refund.
Brett Scott is NIADA vice president of government affairs.