Congress Rolls Back Anti-Discrimination Auto Loan Rule

May 8, 2018
Originally published on May 9, 2018 12:22 am

The House on Tuesday passed a measure to roll back guidance on auto lending issued by the Consumer Financial Protection Bureau. The vote is the first test for a new strategy employed by Republicans in Congress, which could enable the repeal of hundreds of administrative regulations passed in recent decades.

The guidance, issued in 2013, was intended to limit discriminatory practices in the auto loan business. Congress repealed the guidance using the Congressional Review Act, a little-known law that allows Congress to undo the rules issued by administrative agencies and government regulators.

Congressional Republicans used the act in 2017 to repeal more than a dozen Obama-era regulations. Prior to 2017, the Congressional Review Act had been used only once since being passed in 1996.

Normally, the act requires Congress to exercise this power within a narrow window of time — 60 days after the new regulation is submitted to Congress.

But Tuesday's vote marks the first time it has been wielded to reverse administrative guidance — meaning the regulatory agencies' interpretations of federal laws. Because most guidance is not "submitted to Congress," lawmakers argue they can start the clock whenever they want on hundreds of rules issued over the past two decades.

Critics worry this could open the door for congressional rollback of any number of hard-fought consumer and environmental protections. And because the act also prevents federal agencies from re-enacting "substantially similar" regulations and guidance, it means that reinstating the rules could require future congressional action.

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