The Senate Banking, Housing and Affairs Committee (Banking Committee) would eliminate the CFPB's current funding source, as part of Committee's Republican version of its part of the massive budget reconciliation bill, according to legislative language released by the Banking Committee.
Under the existing funding structure, the CFPB may draw up to 12% of the Federal Reserve's inflation-adjusted total operating expenses in 2009. The Banking Committee Republicans will propose reducing that cap to 0%, according to the legislative language.
An earlier Banking Committee memo stated that the CFPB still could request money through the appropriations process. The current legislative language does not specifically mention this, but presumably the bureau could do that.
The House bill would set CFPB funding for 2025 at no more than $249 million, with an annual adjustment for inflation in the future.
By comparison, the CFPB had incurred about $755.1 million in fiscal year 2024 expenses, according to a bureau report (the federal government's fiscal year runs from October 1 to September 30). Of that total, about $480 million was spent on employee compensation and benefits for the 1,755 bureau employees who were on board at the end of the quarter.
The Supreme Court has ruled that the CFPB's funding mechanism is constitutional. However, Senate Banking Committee Chairman Senator Tim Scott, R-S.C., and other Congressional Republicans have long been advocates of making the CFPB subject to the appropriations process, saying that the current funding mechanism leaves the bureau unaccountable to Congress.
With regard to the magnitude of CFPB funding, the Trump Administration has proposed eliminating more than 1,400 employees at the agency, leaving about 200 workers. That plan has temporarily been blocked by the Court of Appeals for the District of Columbia Circuit. The Circuit Court held oral arguments on May 16, 2025, and we are awaiting a decision in the case.
The Senate Banking Committee proposal also would delay for ten years the CFPB's implementation of Dodd-Frank's Section 1071 rule. That rule requires financial institutions to report information contained in loan applications submitted by women-owned, minority-owned and LGBTQI+-owned small businesses.
The House bill does not contain that provision.
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