BANKING, FINANCE AND URBAN AFFAIRS ...NINETY-SIXTH CONGRESS FIRST SESSION ON H.R. 25157 A BILL TO AUTHORIZE ON A TEMPORARY BASIS CERTAIN STANFORD GOV'T Printed for the use of the UNIVERSITY 3 1980 MAR 1980 DOCUMENT DER U.S. GOVERNMENT PRINTING OFFICE WASHINGTON: 1979 HOUSE COMMITTEE ON BANKING, FINANCE AND URBAN AFFAIRS HENRY S. REUSS, Wisconsin, Chairman THOMAS L. ASHLEY, Ohio District of Columbia STEPHEN L. NEAL, North Carolina DAVID W. EVANS, Indiana NORMAN E. D'AMOURS, New Hampshire STANLEY N. LUNDINE, New York JOHN J. CAVANAUGH, Nebraska MARY ROSE OAKAR, Ohio JIM MATTOX, Texas BRUCE F. VENTO, Minnesota DOUG BARNARD, Georgia J. WILLIAM STANTON, Ohio STEWART B. MCKINNEY, Connecticut JIM LEACH, Iowa THOMAS B. EVANS, JR., Delaware ED BETHUNE, Arkansas South Carolina DON RITTER, Pennsylvania JON HINSON, Mississippi Alexander, Bill, a Representative in Congress from the State of Arkansas__ Becker, J. Bill, president, Arkansas State AFL-CIO__ Bowen, William H., member of the board, Arkansas Bankers Association__ Cupp, Cecil W., Jr., chairman, Federal Government relations committee and immediate past president, Arkansas Bankers Association; accom- panied by Doyl Brown, president.... Hammerschmidt, Hon. John Paul, a Representative in Congress from the Hendrix, Olen, Arkansas Senator and chairman, Senate Committee on In- surance and Commerce, Arkansas General Assembly--- Lay, Lyndell E., past president, Mortgage Bankers Association of Arkansas_ McNeish, Peter F., Deputy Associate Administrator for Finance and Invest- Thompson, W. H. "Bill," State representative and chairman, House Com- mittee on Insurance and Commerce, Arkansas General Assembly. Tucker, Jim Guy, general counsel, Committee for Fair Arkansas Interest ADDITIONAL INFORMATION SUBMITTED FOR INCLUSION IN THE RECORD American Bankers Association, prepared statement on behalf by Cecil W. Anthony, Hon. Beryl, Jr., prepared statement_ Arkansas Bankers Association, prepared statement on behalf by William Correspondence received regarding H.R. 2515 from— Department of Housing and Urban Development, letter dated April 113 84 16, 1979, from Edward W. Norton, Acting General Counsel, respond- Page ing to Chairman St Germain's letter of March 8, 1979__. Farm Credit Administration, letter dated March 26, 1979, from Governor Donald E. Wilkinson, responding to Chairman St Germain's letter of March 8, 1979__ Federal Deposit Insurance Corporation, letter dated April 2, 1979, from Stanley C. Silverberg, Director, Division of Research, responding to Chairman St Germain's letter of March 8, 1979___. Federal Home Loan Bank Board, letter dated April 4, 1979, from Chairman Robert H. McKinney, responding to Chairman St Germain's letter of March 8, 1979-. Federal National Mortgage Association, letter dated March 27, 1979, Federal Reserve System, Board of Governors of, letter dated March 123 117 99 90 128 National Association of Mutual Savings Banks, letter dated April 2, 110 134 U.S. League of Savings Associations, letter dated April 13, 1979, from 131 Hammerschmidt, Hon. John Paul, prepared statement_-_ Information submitted at the request of Chairman St Germain___ Hendrix, Senator Olen, text of Arkansas Senate Concurrent Resolution 44 submitted 192 Lay, Lyndell E., prepared statement on behalf of the Mortgage Bankers 198 McNeish, Peter F., prepared statement on behalf of the Small Business 262 Mortgage Bankers Association of Arkansas, prepared statement on behalf by Lyndell E. Lay, past president__ 198 Nishimura, Glenn, prepared statement on behalf of Arkansas Consumer 252 Ramsay, Louis L., Jr., prepared statement-- 59 Small Business Administration, prepared statement on behalf by Peter F. McNeish, Deputy Associate Administrator for Finance and Investment Sprague, Chairman Irvine H., Federal Deposit Insurance Corporation, statement Tucker, Jim Guy, prepared statement presented on behalf of the Committee for Fair Arkansas Interest Rates____ 262 31 244 STATE USURY CEILINGS TUESDAY, APRIL 3, 1979 HOUSE OF REPRESENTATIVES, SUBCOMMITTEE ON FINANCIAL INSTITUTIONS SUPERVISION, REGULATION AND INSURANCE OF THE COMMITTEE ON BANKING, FINANCE AND URBAN AFFAIRS, Washington, D.C. The subcommittee met at 10 a.m., in room 2128 of the Rayburn. House Office Building; Hon. Fernand J. St Germain (chairman of the subcommittee) presiding. Present: Representatives St Germain, Minish, Barnard, Wylie, Hansen, Campbell, and Bethune. Chairman ST GERMAIN. The subcommittee will come to order. In the current Congress, this subcommittee has now been requested to act twice on emergency matters-first, during Washington's famous blizzard of 1979-February 21-for the purpose of repealing section 1104(d) of last year's privacy title to eliminate an unnecessary and costly notice requirement. Today, at the request of the Arkansas delegation, we are asked to deal on a temporary basis with what has been widely recognized as a severe and sustained credit crunch in Arkansas brought about in part by that State's constitutionally imposed 10 percent interest rate ceiling. As regrettable as it is to consider legislation of this nature, representing as it does a clear case of Federal preemption in favor of double digit interest rates for business and agricultural loans, precedent exists for the current proposal which is virtually identical to Public Law 93-501, a copy of which has been furnished to each member of the subcommittee. Public Law 93-501 was in effect from October 29, 1974, until July 1, 1977. The present proposal, if enacted, will expire December 31, 1980, after a constitutional convention and submission to the voters in the general election in 1980. At this point, the Chair would recognize the ranking minority member, Mr. Wylie. Mr. WYLIE. Thank you very much, Mr. Chairman. I want to commend you and the members of the Arkansas delegation for compiling this excellent list of witnesses. We dealt with this problem in the 93d Congress when we passed the bill for the relief of Montana, Tennessee, and Arkansas, the last two of which had a usury law similar to that in their State constitutions, as Arkansas still does today. (1) |