Five senior Members of the House Financial Services today sent a letter to John Walsh, Acting Comptroller of the Currency (OCC), requesting that he extend the comment period for the proposed rule on preemption and visitorial powers for national banks for at least 60 days.  The Members, Representatives Barney Frank, Carolyn Maloney, Luis Gutierrez, Mel Watt and Brad Miller, wrote that the original 30-day comment period was "insufficient to foster a meaningful and balanced exchange of views between the OCC and other interested parties..."

The Members made their request "in light of the OCC's previous preemption rulemaking" and "the clear gravity of preemption determinations generally."  In the period leading to the mortgage crisis, the OCC had preempted state anti-predatory lending statutes.

In a separate statement, Frank, the Ranking Member of the Financial Services Committee, added that the question of the issue of the length of the comment period is compounded by the fact that the permanent head of the agency has not yet been appointed.  "I think an Acting Comptroller should not set rules of this importance," said Frank. “These rules should not be finalized until a permanent head of the OCC is in place."

Text of the letter follows:

Mr. John Walsh
Acting Comptroller of the Currency
Office of the Comptroller of the Currency
250 E Street, S.W.
Washington, DC 20219

Dear Acting Comptroller Walsh:

We are writing to urge you to reopen the comment period for the proposed rule to revise the provisions of 12 CFR part 7 relating to preemption and visitorial powers for national banks.  The original comment period, which closed on June 27, was for only 30 days, which we strongly believe was insufficient to foster a meaningful and balanced exchange of views between the OCC and other interested parties, including consumers; state and federal regulators; members of Congress, particularly those of us who voted to alter substantially the preexisting standards governing preemption and visitorial powers; and depository institutions.  In light of the importance of the preemption and visitorial powers issues to the aforementioned parties and the significant substantive and procedural changes that the Wall Street Reform and Consumer Protection Act required in these areas, we agree with the Conference of State Bank Supervisors that an extension of the comment period by at least 60 days is warranted.

In making this request, we note that it is common for an agency to allow more than 30 days for the public to comment on a rulemaking that raises particularly significant policy issues, such as the rulemaking in question here.  Indeed, the OCC provided a 60-day comment period when proposing its original preemption rule in 2003.  The current rulemaking, like the one in 2003, invokes the special requirements of Executive Order 13132, the principles of which were reiterated in President Obama’s Executive Memo on Preemption dated May 20, 2009.   Executive Order 13132 provides that an agency seeking to preempt state law must provide all affected state and local officials with an opportunity for “appropriate participation in the proceeding,” and the GAO determined that the OCC’s 2003-2004 preemption rulemaking process was flawed in part because the GAO could not verify that the OCC complied with this requirement.  

In light of the history of the OCC’s previous preemption rulemaking, the clear gravity of preemption determinations generally, and the particular issues associated with this rulemaking as a result of the preemption and visitorial power provisions of the Wall Street Reform and Consumer Protect Act, the OCC should provide an even longer comment period for this rulemaking than it did when proposing the original preemption rule that is to be affected thereby.  Accordingly, we urge the OCC to reopen the comment period for its rulemaking regarding preemption and visitorial powers for at least 60 additional days.

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