Newsroom

December 11, 2020

4 things to know this week

Capitol HillNAFCU's widely-read NAFCU Today is credit union leaders' go-to source for the latest on issues impacting the credit union industry. For those short on time, here's a roundup of this week's top need-to-know news related to paycheck protection program (PPP) loan necessity questionnaires, SCOTUS oral arguments, and more.

Legality of PPP questionnaires challenged

The Associated General Contractors of America (AGC) filed a lawsuit against the Small Business Administration (SBA) and Office of Management and Budget this week challenging the legality of PPP loan necessity questionnaires for program loans over $2 million. The lawsuit argues that the questionnaire was developed through an unlawful process, making the questions arbitrary and capricious, as it was concealed from the public without the opportunity to comment. NAFCU and other trades have also flagged issues with the questionnaires.

After the lawsuit was filed, the SBA added a new PPP FAQ (No. 53) related to the questionnaires saying that borrowers must return them to their lenders within 10 days of receipt. The SBA indicates the questionnaire's purpose is to help assess a borrower's certification in their application that the current economic condition makes the loan request necessary, and that it does not mean the SBA is challenging a borrower's certification that is required by the CARES Act.

Relatedly, the Senate Small Business Committee held a hearing Thursday to review the PPP during which Sen. Jeanne Shaheen, D-N.H., raised concerns about the SBA investigating the validity and necessity for businesses to require a PPP – a sentiment that many other senators shared. Senators also offered support for legislation that would allow certain businesses to apply for a second PPP loan and set aside a portion of the funds for community lenders, and also raised similar concerns as NAFCU related to economic injury disaster loans (EIDLs) and tax deductible eligible expenses.

SCOTUS hears arguments in TCPA, FHFA cases

The U.S. Supreme Court this week heard arguments in two cases that could have implications for credit unions: One challenging the definition of an automatic telephone dialing system (ATDS, or autodialer) under the Telephone Consumer Protection Act (TCPA), as well as one related to the single-director structure of the Federal Housing Finance Agency (FHFA) and the government-sponsored enterprises (GSEs) net worth sweeps.

In the autodialer lawsuit, the justices explored issues related to Congress' intent when the TCPA was enacted in 1991 and how new technologies, such as cell phones and text messages, fit – or don't fit – under it. Several justices also indicated that the ATDS definition is outdated and it would be up to Congress to address it.

In the FHFA suit, the justices discussed how the case differs from the CFPB case in which the court determined the bureau's single-director structure is unconstitutional, as well as how the net worth sweep was an administrative action by an acting director that the court viewed as removable at will.

Senate confirms new FCC commissioner

The Senate this week confirmed Nathan Simington to the Federal Communications Commission (FCC). Simington will replace Michael O'Rielly on the commission and his term will run through July 2024. While all seats on the commission are currently filled, FCC Chairman Ajit Pai last week announced he will step down from his position Jan. 20.

NAFCU last week held meetings with staff from several FCC commissioners' offices to discuss erroneous call blocking under the TRACED Act, which is intended to target illegal robocalls, and the commission's notice of proposed rulemaking seeking comment on various exemptions that have been issued under the TCPA. 

NCUA highlights expanded learning opportunities

The NCUA is highlighting its expanded educational opportunities via its Learning Management Service, giving credit unions more resources to help them grow and better serve their members.

In 2020, the NCUA added courses in five areas:

  • basics of lending;
  • understanding share insurance;
  • capital considerations for new credit unions;
  • understanding financial statements; and
  • serving the underserved.

Courses planned for 2021 include “What Every Board Member Needs to Know” and Bank Secrecy Act compliance. The service, which launched in 2017 and is managed by the Office of Credit Union Resources and Expansion, also features webinars on key topics ranging from credit union governance, financial inclusion, regulatory compliance, and more.

Learn more here.