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Palmer Co-Sponsors Legislation to Repeal Consumer Financial Protection Bureau

Brandon Moseley

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By Brandon Moseley
Alabama Political Reporter

Wednesday, July 22, Congressman Gary Palmer (R-Alabama) announced that he is an original co-sponsor of HR3118, the Repeal CFPB Act, that was introduced this week by Rep. John Ratcliffe (R-Texas).  Palmer said in a press release that this bill would repeal the misleadingly named Consumer Financial Protection Bureau (CFPB), a federal agency fundamentally unaccountable to Congress, the President, and the Courts.

US Representative Palmer said, “I support repealing the CFPB because it has too much power and is insufficiently accountable. It’s accountability to the President is limited, as the head of the agency can be removed only for cause. It has little accountability to Congress, because it is not subject to Congressional funding, and instead funded directly by the Federal Reserve. It is also insulated from accountability to the courts, as the laws governing it specifically grant its interpretations of consumer protection law deference over other interpretations. History teaches us that power which is not held accountable, no matter how well intentioned, is often abused.”

Rep. Palmer’s office alleged that whistleblowers confirm that the unaccountable nature of the CFPB has created a situation where regulators have moved from cooperatively working with banks and bank customers to an increasingly antagonistic relationship between the government, regulated industries, and the customers they serve.

According to Rep. Palmer’s office Mr. Ali Naraghi, a career Bank examiner in the Southeast Region of CFPB, the region that oversees Alabama, testified before Congress that he was instructed that he did not do his job appropriately if he did not find violations, and that members of his team were instructed to increase their sample size of the documents they reviewed if they didn’t find a violation. This was contrary to the established procedure.

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Naraghi testified to the House Financial Services Committee on June 18 that after questioning procedures he was targeted by CFPB management: “After being subjected to disparate treatment, I asked my management in May 2012, about the reason for being treated like this. Management responded that they did not like me asking questions about the reason behind orders and what my rights may be, and how I raised questions about certain aspects of CFPB management practices. I did my best to work within the Bureau’s management and oversight structure to address these issues; however, once management started to retaliate, I filed an EEO complaint against Southeast Region’s management. I immediately became one of the targets of my Regional Director Mr. Jim Carley and the Assistant Director of Supervision Mr. Paul Sanford at CFPB Headquarters as a result of questioning examination management and filing a formal case about abuse and disparate treatment. They proceeded to make my professional and personal life a living hell by repeated retaliation and creating a hostile work environment.  Examples of the retaliations include: Immediately after filing an EEO complaint in May of 2012, management issued me a reprimand letter for not attending training class which I was registered for by management without my knowledge; Removing me from being EIC, and requiring me to attend training to serve as an EIC, a requirement only for me and no others at my grade. In fact I have not been assigned an EIC role since filing my EEO case, despite it being a requirement in my Position Description, which is the highest examiner grade for the Bureau;  Reporting me AWOL for an entire week for requesting sick leave, despite having a doctor’s note requiring bed rest to avoid getting pneumonia due to sever bronchitis;  Accused of asking bank management to show me how to do my job when in fact I was trying to protect the integrity of the Bureau by helping the field manager recover from answering questions that demonstrated his incompetence and lack of knowledge about mortgage banking; Being wrongfully accused and written up for falling asleep at a meeting with an institution’s president. The fact (as reported by the EEO independent investigator) that I was awake and the most active participant was confirmed by several colleagues and a CFPB Enforcement Attorney who were present; however, Mr. Carley insisted that my Field Manager issue a written warning with threat of disciplinary action; Issued the lowest performance evaluation rating in 2012 when in fact at mid-year I was rated commendable. This was my punishment for raising concerns about my manager during the last 3 months of evaluation period; and in February 2014 my Field Manager informed me that he knows I am well qualified, but the orders that I cannot be an EIC come from above the assistant regional director level.  Like Ms. Martin, the retaliation against me continues to this day.  Like Ms. Martin, my story is a microcosm and when you look at me you should see dozens and even scores of employees in addition to me.”

HR 3118 would return authority from CFPB back to the seven agencies previously tasked with such duties, allowing for more accountability to the President, Congress and the Courts.  It would not remove any authority that existed in the agencies prior to the creation of the CFPB.

Congressman Ratcliffe said in his own statement, “The CFPB’s regulatory zeal has stripped American consumers and businesses of their freedom of choice and has limited their access to capital – all in the name of a ‘we know best’ attitude from Washington. It seems like every time I go home to Texas and spend time with people across our district, I hear stories about community banks having to choose between closing their doors or consolidating into larger institutions to handle the increase in compliance costs.”

US Senator Ted Cruz (R-Texas) is introducing the legislation in the Senate.   Cruz said, “Don’t let the name fool you, the Consumer Financial Protection Bureau does little to protect consumers. The agency continues to grow in power and magnitude without any accountability to Congress and the people. The only way to stop this runaway agency is by eliminating it altogether.  The legislation that Rep. Ratcliffe and I are introducing today gives Congress the opportunity to free consumers and small businesses from the CFPB’s regulatory blockades and financial activism, which stunt economic growth. While there’s much more to do to scale back the harmful regulatory impositions of Dodd-Frank, this legislation takes a critical step in the right direction. So today let’s celebrate the CFPB’s fourth and final anniversary.”  Cruz is one of 16 Republican presidential contenders.

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The Consumer Financial Protection Bureau was created by the passage of the Dodd–Frank Wall Street Reform and Consumer Protection Act in 2010 when the Democratic Party controlled both Houses of Congress.  Critics view the Agency and Dodd-Frank as an overreaction to the market correction that led to the 2008-2009 Great Recession.

In 2012, US Senator Richard Shelby (R-Alabama) said in a statement to reporters that, “The Dodd-Frank Act intentionally designed the Bureau to be free of even the most basic checks and balances…Mr. Cordray has indicated that he will exercise the full authorities of the Bureau…Because of the structure of the Bureau, this means Mr. Cordray will have unfettered power over the operation of the Bureau.  His decisions alone will determine how the Bureau approaches its work.  If he so chooses, he does not have to answer to anyone.  This is not a choice any bureaucrat should have. Since his appointment, Mr. Cordray has indicated that he intends to proceed cautiously and prudently when he exercises his authority.  The real test, however, will be whether this caution finds its way into the Bureau’s actions. Unfortunately, the Bureau’s early history is not encouraging.”

Senator Shelby said back then, “The Bureau is budgeted to receive a total of $329 million in funds from the Federal Reserve Board this year (in 2012).  This could grow to well over a half a billion dollars as early as next year.  By design, these payments are made directly to the Bureau without any oversight through the congressional appropriations process…It is also my understanding that the Bureau has already hired 800 people, and it has been reported that the Bureau hopes to hire as many as 1,000 people by the end of this year, some making more than $225,000 per year.  How have my Democrat colleagues in the Senate responded to this incredible bureaucratic expansion?  They have resisted every Republican effort to make the Bureau more accountable to the American people by changing its structure.”

US Representative Gary Palmer represents Alabama’s Sixth Congressional District.  He serves on three Congressional committees: Oversight and Government Reform, Budget, and Science, Space and Technology.

 

Brandon Moseley is a senior reporter with eight and a half years at Alabama Political Reporter. You can email him at [email protected] or follow him on Facebook. Brandon is a native of Moody, Alabama, a graduate of Auburn University, and a seventh generation Alabamian.

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Tuberville calls for term limits, balanced budget and lobbying reform

Tuberville has also made a major media buy across the state to trumpet this message.

Brandon Moseley

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Republican Senate candidate Tommy Tuberville (TUBERVILLE CAMPAIGN)

Senate candidate Tommy Tuberville’s campaign began emphasizing key structural reforms that the Republican nominee hopes to advance if elected to the U.S. Senate including congressional term limits, withholding lawmakers’ paychecks unless a balanced budget is passed and a ban on former officials becoming lobbyists.

“Only an outsider like me can help President Trump drain the Swamp, and any of the proposals outlined in this ad will begin the process of pulling the plug,” Tuberville said in a statement. “Doug Jones has had his chance, and he failed our state, so now it’s time to elect a senator who will work to fundamentally change the way that Washington operates.”

Tuberville has also made a major media buy across the state to trumpet this message.

“You know Washington politicians could learn a lot from the folks in small town Alabama, but Doug Jones … he’s too liberal to teach them,” Tuberville added.

Polls consistently show that term limits are popular with people across both political parties, but the U.S. Supreme Court has ruled that imposing term limits would be adding a qualification to be a member of Congress and that can only be done by constitutional amendment.

It is an unspoken truth that when Americans send someone to Congress they never come back. They either keep getting re-elected like Alabama’s own Sen. Richard Shelby, who is in his sixth term in the Senate after four terms in the U.S. House of Representatives. On the other hand, they may become lobbyists getting paid to influence their colleagues on behalf of corporations, foreign governments or some well funded non-government organization.

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Tuberville said he would ban that practice.

A balanced budget amendment almost passed in the 1980s and again in the 1990s.

Since that failure, Congress has increasingly passed bigger and bigger budget deficits. The U.S. government borrowed more money during the eight years of President George W. Bush’s presidency than the government had borrowed in the first 224 years of the country combined.

President Barack Obama followed and the TARP program propped up the post-Great Recession economy. Rather than cutting the deficit, President Donald Trump invested billions in the military and a tax cut without cutting domestic spending. The 2020 coronavirus crisis has further grown the budget.

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The government has borrowed trillions to prop up the economy and provide stimulus while investing billions into medical research and treating the virus victims. Congress is currently debating a fifth stimulus package that would add more to the deficit.

Both a balanced budget amendment and a term limits amendment would have to be ratified by the states if passed by Congress. Tuberville is challenging incumbent Sen. Doug Jones, D-Alabama.

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House passes General Fund Budget

Brandon Moseley

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By Brandon Moseley
Alabama Political Reporter

The Alabama House of Representatives passed the state General Fund Budget on Tuesday.

The General Fund Budget for the 2019 fiscal year is Senate Bill 178. It is sponsored by Sen. Trip Pittman, R-Montrose. State Rep. Steve Clouse, R-Ozark, carried the budget on the House floor. Clouse chairs the House Ways and Means General Fund Committee.

Clouse said, “Last year we monetized the BP settlement money and held over $97 million to this year.”

Clouse said that the state is still trying to come up with a solution to the federal lawsuit over the state prisons. The Governor’s Office has made some progress after she took over from Gov. Robert Bentley. The supplemental we just passed added $30 million to prisons.

The budget adds $50 million to the Department of Corrections.

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Clouse said that the budget increased the money for prisons by $55,680,000 and includes $4.8 million to buy the privately-owned prison facility in Perry County.

Clouse said that the budget raises funding for the judicial system and raises the appropriation for the Forensic Sciences to $11.7 million.

The House passed a committee substitute so the Senate is either going to have to concur with the changes made by the House or a conference committee will have to be appointed. Clouse told reporters that he hoped that it did not have to go to conference.

Clouse said that the budget had added $860,000 to hire more Juvenile Probation Officers. After talking to officials with the court system that was cut in half in the amendment. The amendment also includes some wording the arbiters in the court lawsuit think we need.

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The state General Fund Budget, SB178, passed 98-1.

Both budgets have now passed the Alabama House of Representatives.

The 2019 fiscal year begins on Oct. 1, 2018.

In addition to the SGF, the House also passed a supplemental appropriation for the current 2018 budget year. SB175 is also sponsored by Pittman and was carried by Clouse on the floor of the House.

SB175 includes $30 million in additional 2018 money for the Department of Corrections. The Departmental Emergency Fund, the Examiners of Public Accounts, the Insurance Department and Forensic Sciences received additional money.

Clouse said, “We knew dealing with the federal lawsuit was going to be expensive. We are adding $80 million to the Department of Corrections.”

State Representative Johnny Mack Morrow, R-Red Bay, said that state Department of Forensics was cut from $14 million to $9 million. “Why are we adding money for DA and courts if we don’t have money for forensics to provide evidence? if there is any agency in law enforcement or the court system that should be funded it is Forensics.”

The supplemental 2018 appropriation passed 80 to 1.

The House also passed SB203. It was sponsored by Pittman and was carried in the House by State Rep. Ken Johnson, R-Moulton. It raises securities and registration fees for agents and investment advisors. It increases the filing fees for certain management investment companies. Johnson said that those fees had not been adjusted since 2009.

The House also passed SB176, which is an annual appropriation for the Coalition Against Domestic Violence. The bill requires that the agency have an operations plan, audited financial statement, and quarterly and end of year reports. SB176 is sponsored by Pittman and was carried on the House floor by State Rep. Elaine Beech, D-Chatham.

The House passed Senate Bill 185 which gives state employees a cost of living increase in the 2019 budget beginning on October 1. It was sponsored by Sen. Clyde Chambliss, R-Prattville and was being carried on the House floor by state Rep. Dimitri Polizos, R-Montgomery.

Polizos said that this was the first raise for non-education state employees in nine years. It is a 3 percent raise.

SB185 passed 101-0.

Senate Bill 215 gives retired state employees a one time bonus check. SB215 is sponsored by Senator Gerald Dial, R-Lineville, and was carried on the House floor by state Rep. Kerry Rich, R-Guntersville.

Rich said that retired employees will get a bonus $1  for every month that they worked for the state. For employees who retired with 25 years of service that will be a $300 one time bonus. A 20-year retiree would get $240 and a 35-year employee would get $420.

SB215 passed the House 87-0.

The House passed Senate Bill 231, which is the appropriation bill increase amount to the Emergency Forest Fire and Insect and Disease Fund. SB231 is sponsored by Sen. Steve Livingston, R-Scottsboro, and was carried on the House floor by state Rep. Kyle South, R-Fayette.

State Rep. Elaine Beech, D-Chathom, said, “Thank you for bringing this bill my district is full of trees and you never know when a forest fire will hit.

SB231 passed 87-2.

The state of Alabama is unique among the states in that most of the money is earmarked for specific purposes allowing the Legislature little year-to-year flexibility in moving funds around.

The SGF includes appropriations for the Alabama Medicaid Agency, the courts, the Alabama Law Enforcement Agency, the Alabama Department of Corrections, mental health, and most state agencies that are no education related. The Alabama Department of Transportation gets their funding mostly from state fuel taxes.

The Legislature also gives ALEA a portion of the gas taxes. K-12 education, the two year college system, and all the universities get their state support from the education trust fund (ETF) budget. There are also billions of dollars in revenue that are earmarked for a variety of purposes that does not show up in the SGF or ETF budgets.

Examples of that include the Public Service Commission, which collects utility taxes from the industries that it regulates. The PSC is supported entirely by its own revenue streams and contributes $13 million to the SGF. The Secretary of State’s Office is entirely funded by its corporate filing and other fees and gets no SGF appropriation.

Clouse warned reporters that part of the reason this budget had so much money was due to the BP oil spill settlement that provided money for the 2018 budget and $97 million for the 2019 budget. Clouse said they elected to make a $13 million repayment to the Alabama Trust fund that was not due until 2020 but that is all that was held over for 2020.

Clouse predicted that the Legislature will have to make some hard decisions about revenue in next year’s session.

 

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Day Care bill delayed for second time on Senate floor, may be back Thursday

Sam Mattison

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By Samuel Mattison
Alabama Political Reporter

The day care bill, which would license certain day care centers in Alabama, was once again delayed on the state Senate floor after one lawmaker requested more information.

Its brief appearance Tuesday ended with state Sen. Gerald Dial, R-Lineville, saying a compromise had not yet been worked out with the bill’s detractors.

Alabama’s Senate has been hesitant to act on the legislation because of complaints of state Sen. Shay Shelnutt, R-Trussville, who has been an opponent of the bill since its introduction last year. The bill’s delay on Tuesday marks the second time its been taken off the Senate’s agenda.

The bill has had a rocky time in this year’s session, but the bill’s sponsor state Rep. Pebblin Warren, D-Tuskegee, said she is still confident about its passage out of the Legislature.

Warren, D-Tuskegee, filed the bill this session with the support of influential lawmakers including Gov. Kay Ivey, who told reporters last year that she though all day cares should be licensed.

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Mainly sparked by the death of 5-year-old boy in the care of a unlicensed day care worker, the bill had great momentum coming into this year’ session.

Despite the growing support from lawmakers, Religious groups had concerns that the bill would increase state-sponsored reach into religious day cares in churches and non-profit groups.

Spearheading the dissenters was Alabama Citizens Action Program, a conservative religious-based PAC.

Warren, proponents, and ALCAP announced a compromise to the bill while it was still in the Alabama House.

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Announced by ALCAP originally, the new bill was a weaker version in that it did not require that all day cares in the state be regulated. Instead, religious-based day cares would only need to be registered if they received federal funds. At a Senate committee meeting in February, Warren said a similar requirement was about to come from federal law in Congress.

The bill moved through the House in a overwhelming vote in favor of the proposal and passed unanimously out of a Senate committee a few weeks ago.

Warren, speaking to reporters after its passage from the House, said she was unsure if the bill would encounter resistance in the upper chamber.

It was the Senate that killed the daycare bill last year amid a cramped last day where senators took the bill off the floor. The bill may face similar complications this year, as lawmakers seem to be preparing to adjourn within a few weeks.

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Fantasy sports bill fails on Senate floor

Sam Mattison

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By Samuel Mattison
Alabama Political Reporter

Would-be Fantasy Sports players in Alabama will have to wait to legally play in the state following a Senate vote on Tuesday.

The Alabama Senate decisively killed a bill to exempt fantasy sports from the state’s prohibition on gambling.

Not even entertaining a debate on the Senate floor, the proposal was killed during a vote for the Budget Isolation Resolution, which is usually a formality vote preluding a debate.

Fantasy sports are contests where participants select players from real teams to compete on fantasy teams using the real-world players’ stats.

Since 2016, the practice has been illegal in Alabama following a legal decision by the Attorney General’s Office that categorized it as gambling.

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The bill’s sponsor, state Sen. Paul Sanford, R-Huntsville, predicted the bill’s failure during a committee meeting two weeks ago, where the bill passed unanimously.

Sen. Paul Sanford speaks to reporters after a Senate Committee meeting on Feb. 28, 2018. (Samuel Mattison/APR)

Speaking to reporter’s after the committee meeting, Sanford said the decision to file the bill was mainly a philosophical belief that the practice shouldn’t be illegal.

Sanford, a fantasy sports player before its ban, said that fantasy sports are a way to bring people closer together and not a means to win money. The Huntsville senator is not seeking re-election.

The bill’s failure in the Senate follows its trajectory last year too. A similar version of the bill, also sponsored by Sanford, failed in the Senate during the final days of the 2017 Legislative Session.

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Since Sanford is retiring, it is unclear if the bill will even come back next session, or if it will even have a Senate sponsor.

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