82R17922 CBE-D
By: Flynn, Chisum, et al. H.C.R. No. 94
Substitute the following for H.C.R. No. 94:
By: Pitts C.S.H.C.R. No. 94
HOUSE CONCURRENT RESOLUTION
WHEREAS, The banking and insurance industries are essential
to the continued growth and well-being of Texas, serving as
important hubs of economic activity for communities throughout the
state; the Dodd-Frank Wall Street Reform and Consumer Protection
Act not only poses a major threat to these businesses, but will
serve as a destructive influence on the entire state; and
WHEREAS, The Dodd-Frank Act, which was passed by the United
States Congress on July 21, 2010, consists of 2,300 pages of new
statutory language that will result in the promulgation of more
than 250 new federal regulations; supporters of the legislation
claim that it will equip federal regulators with powers to prevent
another financial debacle like the country experienced from 2007
through 2009, but in reality, the bill sets up a regulatory regime
that allows "Too Big to Fail" banks and Wall Street to continue to
avoid adequate scrutiny while it punishes traditional Texas banks
that had nothing to do with the most recent crisis; and
WHEREAS, A new Bureau of Consumer Financial Protection is
established to regulate all consumer financial services in the
United States; the bureau will receive hundreds of millions of
dollars in annual funding from the Federal Reserve System and is not
subject to congressional oversight through the appropriations
process; it will have the power to decide what types of financial
products can and cannot be offered, and it will have the power to
set prices for consumer loans, mortgages, and small business loans;
and
WHEREAS, If this new agency were to become what its advocates
have envisioned, it will be at least as large as the Internal
Revenue Service; Texas banks will have fewer and more expensive
products to offer to their customers, and the credit needs of rural
and urban Texans will be determined by an agency in Washington; and
WHEREAS, The Bureau of Consumer Financial Protection will
also greatly increase compliance costs for Texas community banks;
smaller banks will see their compliance and employee costs increase
by tens of thousands of dollars on an annual basis, resulting in
millions of dollars in loans lost to area communities; furthermore,
these new costs will drive down profitability and lead to the
consolidation of the banking industry; fewer banks means less
credit and fewer choices for borrowers across the state; and
WHEREAS, Even before the effective date of the Dodd-Frank
Act, federal bank regulators have been examining banks and imposing
sanctions that are harming credit availability all over Texas; in
the name of consumer protection and fair lending, the federal
agencies are curtailing services, such as overdraft protection,
that are wanted by Texas bank customers; the limitation on bank
service fees will increase costs for all consumer services and lead
to the end of offerings such as free checking; during fair lending
examinations, banks are being told that discrepancies of a few
cents in the charging of interest rates can lead to referrals to the
U.S. Department of Justice; this has led to a chilling effect and a
reluctance by community banks to make small consumer and business
loans; and
WHEREAS, Another example of federal intervention in the
pricing of financial products is the rate caps placed on
interchange fees for debit cards; the Dodd-Frank Act takes the
pricing of these services from the marketplace and places it in the
hands of the Federal Reserve; the most recent proposal from the
Federal Reserve would so severely restrict interchange fees that
banks and credit unions will be unable to cover the full costs
associated with providing checking accounts and debit cards; as a
result, banks and credit unions will be forced to cease offering
some debit and checking products and to increase fees on those they
continue to provide; lower income Texans who have obtained greater
access to affordable retail banking, partly because of interchange
fees, will have less access to traditional institutions and be
forced to go back to the less regulated "shadow" banking system with
its increased costs; now, therefore, be it
RESOLVED, That the 82nd Legislature of the State of Texas
hereby respectfully urge the Congress of the United States to
repeal the Dodd-Frank Wall Street Reform and Consumer Protection
Act; and, be it further
RESOLVED, That the Texas secretary of state forward official
copies of this resolution to the president of the United States, to
the president of the Senate and the speaker of the House of
Representatives of the United States Congress, and to all the
members of the Texas delegation to Congress with the request that
this resolution be entered in the Congressional Record as a
memorial to the Congress of the United States of America.