House GOP Considers Ways to Avoid Divisive Swipe-Fee Caps

By Rob Tricchinelli

House Republican lawmakers are considering ways to scuttle the proposed repeal of a law that limits debit-card transaction fees, an effort that is causing intra-party friction as the chamber readies Dodd-Frank Act overhaul legislation.

Republicans are weighing a procedural maneuver that would allow the repeal language to be stripped out of the larger bill in the House Rules Committee. The action would keep the caps in place without forcing House members to go on the record on either side of the divisive issue.

Banking groups want to repeal the part of Dodd-Frank that established the limits, known as the Durbin amendment, but they have faced a protracted lobbying conflict with retailers and restaurant groups over law and the billions in fees that are at stake.

Freshman Rep. Ted Budd (R-N.C.) balked at the procedural attempt. “We respect the desire of leadership to avoid dividing the Conference,” he wrote in a May 16 letter to Republican leadership obtained by Bloomberg BNA, but a scenario where “the House never takes a vote on the Durbin Amendment is not acceptable under even an elastic standard of regular order.”

Disagreements Mean Delay

The procedural and substantive disagreements, congressmen and lobbyists say, have delayed a floor vote on the larger bill, which was approved by the House Financial Services Committee on May 4.

That bill (H.R. 10), known as the Financial Choice Act, would roll back many aspects of Dodd-Frank, including the Volcker Rule and regulators’ ability to help wind down large banks in a crisis. It is being pushed by Rep. Jeb Hensarling (R-Texas), who chairs the committee. Hensarling’s office didn’t respond to a request for comment.

Every committee Republican backed the bill during the May vote, even though Reps. Dennis Ross (R-Fla.) and Bruce Poliquin (R-Maine) expressed reservations over the swipe-fee language.

The Choice Act is unlikely to come to the floor the week of May 22, several sources familiar with the process told Bloomberg BNA. With the House scheduled to recess the week of May 29, any Rules Committee or floor action wouldn’t come until June at the earliest.

Recent comments by Senate Majority Leader Mitch McConnell (R-Ky.) further complicate the timing. McConnell expressed pessimism May 16 that any major overhaul of Dodd-Frank is possible given Democratic opposition in that chamber.

Rules Options

Several options are being discussed by House leaders. The Rules Committee could modify the language using a “print” that drops the Durbin repeal language, or it could craft a “self-executing rule” that would drop the language.

If the Rules Committee removed the repeal, it could also send a rule to the full House that would allow the Choice Act to be considered without permitting additional attempts to bring the Durbin amendment repeal back into the bill.

Budd said the moves could violate regular order of the House. “We will not support a procedural motion that both strips the Durbin amendment repeal language from the Financial Choice Act, and does not allow for a floor vote on the policy,” he said in the letter.

Lobbying Blitz

Trade groups have poured resources into the Durbin issue for years. Retailers and restaurant groups say the fee caps promote competition and have saved customers billions.

Leslie Shedd, a spokeswoman with the National Restaurant Association, told Bloomberg BNA in an interview that the group is preparing for any procedural path that House leaders might take.

“Whether that is something that happens in the rules committee, whether that means a floor fight through an amendment, we’re going to continue to keep the pedal down and keep pushing as hard as possible.”

The group has run digital and print ads in the home districts of several Republican representatives, including Reps. Charlie Dent (R-Pa.), Elise Stefanik (R-N.Y.) and Carlos Curbelo (R-Fla.), urging them to keep the Durbin amendment in place.

Banking groups, though, argue that merchants haven’t passed on those savings, and the lost fee revenue for banks has caused them to pare back basic services to customers, like free checking accounts.

“The Financial Services Committee spoke loudly when they put the Durbin repeal in the bill,” James C. Ballentine, the chief lobbyist for the American Bankers Association, told Bloomberg BNA in an interview. “We’re feeling very good right now that it’s going to stay in there,” he added.

To contact the reporter on this story: Rob Tricchinelli in Washington at

To contact the editor responsible for this story: Seth Stern at

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