April 17, 2024 - Last week we discussed the coming “Congressional Review Act deadline” for pending federal agency rules or regulations.  In short, under the CRA, any rule finalized after late May 2024 (according to the National Law Review) would be subject to voidance if the coming election resulted in a complete Republican sweep. We highlighted how rare and difficult it is to take advantage of the CRA and how it generally only occurs after a sweep by one party also results in a change of the party of the president. Indeed, 19 of the 20 most recent successful uses of the CRA occurred after Trump (16) and Biden (3) came to office with the backing of both house of Congress.

And yet  this week, the House Financial Services Committee (“HFSC”) is “marking up” seven bills and six joint resolutions under the CRA. They include the CRAs target the SEC’s climate rule, the CFTC’s rule on credit card fees, FSOC’s rule relating to “Guidance on Non-Bank Financial Company Determinations”, and the Fed, OCC and FDIC’s rules on “Principles for Climate-Related Financial Risk Management for Large Financial Institutions.” 

So, what’s going on?

First, some level setting: What is a markup?  The Congressional Research Center, a public policy research institute of Congress working within the Library of Congress, writes that “[t]he purpose of a committee markup is to determine whether a bill or draft bill should be recommended to the full House and, if so, in what form.”  In a nutshell, it is an opportunity for committee members to offer amendments to the bill as originally proposed before the bill is presented to the full House.

The answer is that, just like regular legislation, many CRA Joint Resolutions are introduced with little hope that they will ultimately be passed. Stated differently, Schoolhouse Rock – I’m Just a Bill, could have had a sequel: “I’m Just a CRA.”  Just like a bill, CRAs need to be passed by both houses of Congress and signed by the president (albeit with only a bare majority in each case). 

In all likelihood, the CRAs will be marked up and passed by the full House, and could even, theoretically, squeak their way through the Senate. Nevertheless, it is hard to imagine any scenario in which President Biden signs any of these CRAs. The real CRA action, if at all, will have to wait for the next Congress.