Action comes under terms of the Congressional Review Act; President is expected to veto measure, with little prospect of override

The Senate on May 24, acting pursuant to the terms of the Congressional Review Act (CRA), passed a resolution of disapproval regarding the Department of Labor's so-called "fiduciary rule." The legislation (H.J. Res. 88) targets a final regulation issued by the Department of Labor on April 8 that requires investment advisors to act in their clients' best interest when providing advice for a fee regarding IRAs and 401(k) plans. The Senate vote was 56-41- with three Democrats (Sens. Donnelly of Indiana, Heitkamp of North Dakota and Tester of Montana) joining 53 Republicans to pass the resolution. The resolution passed the House on April 28 by vote of 234-183.

The language of the resolution provides that if enacted, the regulation in question would have "no force or effect." The measure now goes to the President. On April 27, the Office of Management and Budget issued a Statement of Administration Policy on H.J. Res 88, which said that "If the President were presented with H.J. Res. 88, he would veto the bill." Neither the House nor the Senate votes met the two-thirds supermajority that would be needed to override the expected veto; therefore the resolution is expected to be vetoed and the fiduciary rule is expected to stay in effect.

The CRA requires agencies to submit new regulations to Congress and provides a fast-track process for the consideration of a joint resolution of disapproval to block the rules by majority vote in each House of Congress. The CRA provides for an expedited timetable for consideration of such disapproval resolutions to ensure that they cannot be blocked in committee or filibustered in the Senate. Joint resolutions considered under CRA procedures are subject to presidential veto and constitutionally prescribed veto override requirements.

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