The chairman of the House Financial Services Committee got two financial regulatory bills attached to the government spending bill that cleared the House Thursday en route to President Trump’s desk.
Rep. Jeb Hensarling, R-Texas, has been angling to get House bipartisan regulatory relief bills added to a different legislative vehicle, a bipartisan banking bill that has cleared the upper chamber. But two of the bills hitched a ride on the $1.3 trillion omnibus spending bill.
The bills “are just two of the nearly three dozen strong bipartisan bills our committee has advanced this Congress and that we hope our Senate colleagues will give the same consideration,” Hensarling said Thursday.
One of the bills would be a significant change for private equity firms.
The legislation would amend Securities and Exchange Commission regulation of business development companies, which are funds that buy equity in firms and sell publicly traded shares, allowing retail investors to benefit from their profits. They are often run by private equity funds, which the public cannot easily invest in. The bill would allow BDCs, as they are known, to take on more debt relative to investors’ equity, a step that critics have said would expose investors to undue risk.
Previously, the bill, authored by Rep. Steve Stivers, R-Ohio, had cleared the committee with strong bipartisan support.
Another bill, authored by Rep. Nydia Velazquez, a New York Democrat who grew up in Puerto Rico, would instruct the SEC to identify ways to help small businesses affected by natural disasters.
Bank lobbyists in past years have sought to get lawmakers to attach controversial and major rule changes to must-pass legislation. Memorably, they succeeded in 2014, prompting a major confrontation between liberal Democrats led by Sen. Elizabeth Warren, D-Mass., and party leaders.
The legislation included in this year’s spending deal is less controversial, although the Stivers bill is opposed by some outside groups critical of Wall Street practices.
This story has been changed to correct the description of the bill authoed by Rep. Velazquez.
