By Silla Brush - 06/08/10 11:25 PM EDT
Reps. Debbie Wasserman Schultz (D-Fla.) and Kenny Marchant (R-Texas) are leading an effort to persuade Congress to drop a provision from the Wall Street overhaul package that would clamp down on debit card fees.
The fee issue is emerging as one of the biggest battles in the issue as House and Senate lawmakers look this month toward a conference agreement to resolve scores of differences in the legislation. Congress is planning to approve the overhaul package, stretching more than 1,500 pages, before the Fourth of July recess.
Conference lawmakers are now forced to decide whether to retain the provision or drop it because the House did not include a similar provision when the legislation passed the lower chamber in December. Removing the provision may be an uphill battle given its strong support in the Senate.
In a draft letter to fellow lawmakers, Wasserman Schultz and Marchant said they have “grave concerns” and that the provision would “devastate credit unions and community banks.” The lawmakers are planning to circulate the letter this week to gather signatures, said a Wasserman Schultz aide.
New York Democratic Reps. Gregory Meeks, an expected conferee, and Mike McMahon recently told The Hill they are opposed to the provision.
Banks and credit unions have been lobbying aggressively against the provision, which passed on a 64-33 vote, with 10 Democrats opposed and 17 Republicans in support.
The National Association of Federal Credit Unions (NAFCU), Credit Union National Association (CUNA) and Independent Community Bankers of America (ICBA) have led the charge against the provision. They are part of a broader industry group called the Electronic Payments Coalition.
Durbin aimed to craft the provision to exempt banks and credit unions with less than $10 billion in assets. But credit unions and smaller banks say the exemption would not help them and that they would be subject to the same Federal Reserve rates.
They also say the provision would not be helpful to consumers, as its backers argue.
“The interchange language in the Senate bill will in effect shift costs from big-box stores and giant retailers onto consumers,” Fred Becker, president and CEO of NAFCU, wrote to lawmakers and regulators this month.
Durbin and retail interest groups are strongly urging lawmakers to retain the provision, arguing it would clamp down on excessive fees. The Merchants Payments Coalition represents retailers, supermarkets, convenience stores and others lobbying for the provision. The groups have presented millions of signatures on petitions supporting their position.
On Tuesday, the coalition circulated a letter from 215 national and state trade associations in support of the measure. The Consumer Electronics Association, National Association of Convenience Stores and National Retail Federation are among the groups included in the letter.
“Congress has an historic opportunity to help small businesses, retailers, restaurants and all of our members by reforming swipe fees,” said Lyle Beckwith, senior vice president at the convenience store group.
Rep. Peter WelchPeter WelchEpiPen investigation shows need for greater pricing transparency, other reforms Dem lawmakers: Clinton should have disclosed illness sooner Former Clinton adviser unsure of security protections on server MORE (D-Vt.) has been building support for the provision in the House.