On July, 17th, the US Senate acted on the Terrorism Risk Insurance Act for seven years. In a vote of 93-4, lawmakers greenlighted the bill that Senator Charles Schumer (D-NY) introduced which keeps the federal backstop in place through 2021 while slightly reducing the government’s financial obligations. Also approved as part of the bill were three amendments, including a proposal by Sen. David Vitter (R-La) requiring the Federal Reserve Board (FRB) of Governors to have at least one member on the board with community bank or community bank regulatory experience.
Presenting his amendment to the Senate floor, Mr. Vitter said “It would help introduce balance to a Federal Reserve that has come to lean too heavily on officials with academic and “megabank” experience.There’s an unmistakable trend away from having adequate representation from folks with community bank experience,” he said. Vitter had previously introduced similar stand-alone legislation, arguing that community banks are under-represented in policy debates.
The other two amendments that were passed unanimously were by Sen. Jon Tester, (D-MT)., to establish the National Association of Registered Agents and Brokers and a proposal from Sen. Jeff Flake, R-Ariz., to create an advisory committee on private market reinsurance options. The Senate blocked a fourth amendment that was introduced that would have given the government more time to recoup funds from insurance companies following a terror attack.
It is now left to the House to pass a TRIA reauthorization which is being carried by Representative Randy Neugebauer (R-TX). Action on the legislation is forcasted to take place next week and could face opposition from several parties.