Overview
Title
To enhance rulemaking requirements for the Bureau of Consumer Financial Protection, and for other purposes.
ELI5 AI
H.R. 2331 wants to make sure the rules for protecting people who use money stuff, like banks, are clear and fair. It tells the rule-makers to think hard about why new rules are needed and how they might affect everyone, especially small businesses.
Summary AI
H.R. 2331 aims to make rulemaking by the Bureau of Consumer Financial Protection more transparent and thorough. It requires that any proposed regulation be fully published in the Federal Register and include detailed analyses of the regulation's necessity, potential overlap with other regulations, and its costs and benefits. This includes evaluating the impact on small businesses and exploring less burdensome alternatives. The bill ensures that any assumptions and studies used in these analyses are clearly explained.
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AnalysisAI
Summary of the Bill
The proposed legislation, titled the "Transparency in CFPB Cost-Benefit Analysis Act," aims to amend the Consumer Financial Protection Act of 2010. It seeks to impose additional rulemaking requirements on the Bureau of Consumer Financial Protection (CFPB). The key objective is to enhance transparency by mandating comprehensive cost-benefit analyses for any proposed regulations. This includes detailed assessments of costs, benefits, and alternatives, as well as the implications for small businesses and other stakeholders. The legislation also requires the bureau to substantiate its regulatory choices and assumptions with peer-reviewed studies and data.
Significant Issues
A prominent issue revolves around the requirement to provide a probability distribution of relevant outcomes "when feasible." This vague phrasing might lead to inconsistent interpretations, potentially compromising the transparency and accountability the bill aims to establish.
Additionally, defining "reasonable alternatives" to proposed regulations is another area of concern. The ambiguity here could result in varied interpretations, affecting the thoroughness of regulatory analyses.
The necessity to consult the Office of Advocacy within the Small Business Administration if a regulation potentially increases costs for small businesses is another point of inconsistency. This consultation requirement could be unevenly applied, possibly disproportionately impacting small enterprises.
Lastly, the technical language used throughout the bill, while detailed, might be challenging for the general public to understand, hindering broader public comprehension and engagement with the regulatory process.
Impact on the Public
For the general public, this bill could mean a more transparent regulatory process, ideally leading to regulations that are better understood and justified. If successfully implemented, the added transparency could foster increased trust in the regulatory decisions made by the CFPB.
However, the bill's complex and technical language may deter ordinary citizens from engaging with or fully understanding these regulatory processes. This lack of clarity could limit the public's ability to participate meaningfully in discussions around proposed regulations.
Impact on Stakeholders
The introduced legislation could have varying impacts on different stakeholders. For businesses, particularly small businesses, the requirement for comprehensive analyses and consultation with the Small Business Administration could mean greater consideration of their challenges when new regulations are proposed. This may result in regulations that are more attuned to their operational realities, potentially reducing unwarranted regulatory burdens.
On the other hand, the ambiguous language regarding feasible analyses and reasonable alternatives might result in inconsistent regulatory interpretations, posing challenges to stakeholders who rely on clear, stable guidelines for compliance.
For regulatory agencies, the bill introduces additional procedural burdens to justify regulatory decisions and conduct thorough analyses, which might necessitate increased resources or time.
Overall, while the bill aims for greater transparency and accountability in regulatory rulemaking, its success heavily relies on how these requirements are implemented and how ambiguities are addressed by relevant stakeholders.
Issues
The requirement for a probability distribution of relevant outcomes 'when feasible' may lead to inconsistent applications or interpretations of feasibility. This lack of clarity could result in arbitrary implementations, affecting transparency and accountability. (Section 2)
The definition of 'reasonable alternatives' to regulations is ambiguous, which could lead to varied and potentially biased interpretations of what constitutes a reasonable alternative. This could impact the thoroughness and objectivity of regulatory analyses. (Section 2)
There could be inconsistent application of the requirement for the CFPB to consult the Office of Advocacy within the Small Business Administration if proposed regulations increase costs for small businesses. Inconsistencies in application could disproportionately impact small businesses. (Section 2)
The language is technical and detailed, potentially hindering comprehension by the general public. This could reduce transparency and public engagement with the regulatory process. (Section 2)
The process for determining why private markets, state, local, or tribal authorities cannot address the problem may involve subjective judgments, leading to arbitrary and potentially unjustifiable conclusions. (Section 2)
The phrase 'quantitative and qualitative assessment of all anticipated direct and indirect costs and benefits of the proposed regulation' is open to interpretation. This could lead to bias or incomplete analysis, undermining the integrity of the regulatory assessment. (Section 2)
Sections
Sections are presented as they are annotated in the original legislative text. Any missing headers, numbers, or non-consecutive order is due to the original text.
1. Short title Read Opens in new tab
Summary AI
The "Transparency in CFPB Cost-Benefit Analysis Act" is the title given to this legislative act.
2. Transparency in cost-benefit analysis Read Opens in new tab
Summary AI
The amendment to the Consumer Financial Protection Act of 2010 requires the Bureau to add detailed analyses to proposed rulemakings, including assessments of costs and benefits, potential conflicts with other regulations, and impacts on small businesses and communities, ensuring transparency and consideration of alternatives. Additionally, the Bureau must explain its assumptions and use peer-reviewed studies when preparing these analyses.