GoWest Congressional Leaders Rollout Data Privacy Package

Posted by Ryan Fitzgerald on April 9, 2024

On Monday, Senator Maria Cantwell (D-WA), Chair of the Senate Committee on Commerce, Science, and Transportation, and Cathy McMorris Rodgers (R-WA-5), Chair of the House Committee on Energy and Commerce,  rolled out a “conversation draft” of comprehensive legislation that would overhaul national data privacy laws and establish a robust enforcement mechanism. The bipartisan package known as the “American Privacy Rights Act” comes as a result of decades of advocacy and conversations regarding the importance of establishing a national data standard. GoWest advocates have been at the center of this effort, and most recently called on both Chairs to help pass legislation that would establish this national data standard.

The legislation has been rolled out as a discussion draft to gain input from stakeholders, germane committees in Congress, and leadership in both the House and Senate. Other data protection / data privacy bills have been introduced in the 118^th Congress, including by House Financial Services Committee Chairman Patrick McHenry (R-1-NC), and our Washington delegation co-sponsors, want to work toward a consensus-based bill that can move forward before the end of the 118^th Congress. There is a potential for a shakeup in Congress, following the November election, and it may be challenging to move something forward during the “lame duck” months that Congress has remaining before years end. Moreover, Chairwoman McMorris Rodgers will be retiring from Congress at the end of the year, and thus is working diligently to move a bipartisan package forward.

“This bipartisan, bicameral draft legislation is the best opportunity we’ve had in decades to establish a national data privacy and security standard that gives people the right to control their personal information,” stated McMorris Rodgers and Cantwell in a joint statement. “This landmark legislation represents the sum of years of good faith efforts in both the House and Senate. It strikes a meaningful balance on issues that are critical to moving comprehensive data privacy legislation through Congress. Americans deserve the right to control their data and we’re hopeful that our colleagues in the House and Senate will join us in getting this legislation signed into law.”

GoWest is digging into the nuances and intricacies of the draft legislation and preparing to provide feedback to the Chairs of both committees. In a first take review of the legislation, we are pleased to see a couple of key components that GoWest advocates have been promoting for years, such as state preemption, but there appear to be caveats that we need to better understand in these sections. Additionally, there are some components that will likely give pause to GoWest credit unions, and we will be working with the sponsors to better understand these areas and to prepare specific feedback as it is appropriate.

Some of the key sections include:

• Establishing key definitions for covered entities, covered data, sensitive covered data, large data holders, small businesses, and targeted advertising.
• Establishes consumer controls over covered data as well as opt-out rights and mechanisms.
• Data usage and data minimization standards on how specific data and covered data can be collected, processed, utilized, retained, or transferred.
• State preemption with the exception of state laws around consumer protection, civil rights, privacy of specific entities, data breach, notification; banking and financial records; and several others.
• Private rights of action for consumers are also included as is enforcement actions by the Federal Trade Commission and States Attorneys General.

Initial discussions between GoWest and America’s Credit Unions have outlined a handful of items that are of initial interest and where more clarity is needed so that we can provide Chairs Cantwell and Rogers with our clear feedback.

These areas include:

• Exceptions that are outlined in the state pre-emptions section;
• Impacts or intricacies of third-party vendor data utilization for credit union partners;
• Specific details on private rights of action;
• Apparent charter discrepancies between federal and state chartered financial institutions;
• Gramm-Leach Bliley covered entities being exempted from certain components of the legislation, which may give flexibility to credit unions.

Following our more in-depth analysis of the legislation, the GoWest Advocacy Team will send out a broader breakdown of the current draft legislation, detailing where improvements in the bill could be made. Moreover, it will help outline our advocacy position for the legislation in the coming months, including during our Hike the Hill events in the Spring and the Fall. Following our meetings with Senator Cantwell’s staff later this week, we expect to have a timeline for language adjustment and bill introduction as well as her team’s expectations for hearings and markup of the legislation.

A great deal of appreciation goes out to our GoWest advocates who have been discussing the issue of data privacy / data protection with both of these Washington leaders, and with other Members of Congress for the past decade. Your collective voices have made an impact on these leaders, and we greatly appreciate your continued commitment to credit union advocacy. This announcement, coupled with several bill co-sponsorships of credit union friendly legislation, can be directly connected to the historic work of our GoWest advocates and attendees at the National GAC events this year as well as the year-round advocacy efforts made by our movement.

Posted in Federal Advocacy.