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NCSL Updates
Coalition Urges Passage of Farm Bill
NCSL joins the National Association of Counties, National League of Cities, U.S. Conference of Mayors, Council of State Governments and International City/County Council Management Association in strongly recommending passage of a comprehensive farm bill before the end of the 118th Congress. Passing this bill is vital to maintaining America’s agricultural productivity and security, growing our rural economies and providing vital nutrition assistance programs. Read more
Administration Updates
CFPB Creates Registry for Nonbank Repeat Offenders
According to the Consumer Financial Protection Bureau, the new registry will help the agency identify repeat corporate offenders and recidivism trends. The rule requires nonbank financial companies to register with the CFPB when they have been caught violating consumer protection laws and an enforcement order has been issued. It also requires these companies to provide a written attestation confirming compliance with any orders. The agency expects that state attorneys general, state regulators and other law enforcement agencies will use the registry to monitor attempts by these companies to continue scamming consumers. Read more
CFPB Issues New Rule to Supervise Large Nonbanks Offering Financial Services
Banks and credit unions offering consumer payment services are subject to CFPB supervision, while many large technology firms offering similar financial services are not. The most widely used payment and wallet apps covered by the new rule process over 13 billion consumer transactions annually, the agency estimates. Like their bank counterparts, nonbank companies must now submit to supervisory examinations of the way they handle privacy, surveillance, errors, fraud and other measures. Read more
Federal Reserve Warns of Rising Cybersecurity Threats
In its recent report, the Federal Reserve raises alarms about the growing risks that cyberattacks and technology failures pose to U.S. financial stability. The central bank highlighted increased geopolitical tensions and advances in artificial intelligence as factors that have quickly intensified these threats. With financial regulators increasingly concerned about the sector’s dependence on technology, state lawmakers may need to consider strengthening cybersecurity measures for financial institutions. Read more
$2B for Specialty Crop Industry
The Agriculture Department is issuing more than $2 billion in grants for the specialty crop industry to address issues in the agricultural supply chain. The department also announced its intent to create the Commodity Storage Assistance Program. The $140 million allocated to this program will allow farmers access to packing houses, grain elevators and other facilities crucial to marketing their produce. This announcement builds on previous investments such as the Regional Agricultural Promotion Program, the Assisting Specialty Crop Exports initiative and the Emergency Grain Storage Assistance Program. Read more
Court Updates
Supreme Court to Review Constitutionality of Universal Service Fund
The Universal Service Fund supports several internet and phone subsidy programs at the Federal Communications Commission, such as the E-Rate and Lifeline programs. The E-Rate program helps schools and libraries obtain affordable broadband. The Lifeline program provides a discount on phone service to qualifying low-income consumers.
The USF is administered by a nonprofit, the Universal Service Administrative Co., and its funding comes from surcharges on consumers’ phone bills. In a lawsuit brought by Consumers’ Research, the 5th U.S. Circuit Court of Appeals recently found that this mechanism for collecting contributions for the USF was a tax, rather than a fee, and the FCC’s delegation of program administration to a nonprofit was an unconstitutional delegation of Congress’ taxing authority. The FCC appealed to the U.S. Supreme Court, which has agreed to review the circuit court’s decision.
Current FCC chair, Jessica Rosenworcel, expressed her support for the court’s decision to review the 5th Circuit’s ruling. Rosenworcel noted the broad, bipartisan support for the USF to connect “the most rural and least-connected households in the United States, as well as hospitals, schools and libraries nationwide,” and that she was “hopeful” the court would overturn the decision that “put this vital system at risk.”
Congress has also expressed interest in examining the USF to ensure its viability into the future, especially in the wake of the 5th Circuit’s decision. A bipartisan group of lawmakers led by new Senate Majority Leader John Thune (R-S.D.) started the Senate Universal Service Fund Working Group dedicated to preserving the USF. The group has been holding discussions seeking bipartisan consensus on ways to reform the fund.