The House FinServ Capital Markets and GSE Subcommittee today held a hearing examining whether regulations have adversely affected the availability of short-term financing. Republicans at the hearing used this as an opportunity to direct fire at the SEC’s floating NAV requirement for MMFs (see Client Report MMF13). Rep. Rothfus (R-PA) called for passage of H.R. 4216, which would permit prime and municipal MMFs to offer stable NAVs and currently has twelve Democratic and eight Republican cosponsors. Several Democrats attending the hearing pushed back against the bill, reflecting growing Democratic opposition to measures once seen as relatively non-controversial, bipartisan revisions to the Dodd-Frank framework. Legislation may advance more easily in the next Congress, especially given that no veto threat would hang over the bill, but legislation is not necessary in 2017 to advance the goals laid out today. This report analyzes today’s session.
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