Senators Scoff at White House-Favored Robocall Provision in Budget Deal

The Office of Management and Budget “advanced it, they put it on the table,” Senate Commerce Committee Chairman John Thune, R-S.D., told reporters, saying the provision has featured in the president’s budget for years. “It generates some revenue, which is why it was in the discussions during this current budget debate.” But OMB thought it would raise $120 million over 10 years, and the Congressional Budget Office said it was negligible in its assessment, according to a staffer for Thune. “There’s a dispute about that,” Thune agreed.

The White House sees virtue in the provision, it confirmed. “This provision clarifies that the use of automatic dialing systems and prerecorded voice messages is allowed when contacting wireless phones in the collection of debt owed to or granted by the United States,” an Obama administration official told us Wednesday. “In an age where more and more Americans rely on cell phones, often exclusively, it is important to be able to alert those who owe money to the government if they are in danger of default, which can harm their ability to secure credit long term. In the case of Federal student loan debt, if loan servicers are able to contact a borrower, they have a much better chance at helping that borrower resolve a delinquency or default.”

Negotiators unveiled the two-year budget deal Monday. The House approved the measure Wednesday.

McCaskill was visibly incensed about the issue during the Wednesday hearing, disavowing any knowledge of how such a provision became part of the deal. “CBO doesn’t even say we’re going to get any money from it,” she said. “I have a hard time imagining, if someone has debt collection coming after them, I have a hard time imagining robocalls would be very effective.” She said the legislation would compel the FCC to develop regulations within nine months of enactment “to limit the number and duration of such calls,” as the deal summary said. McCaskill said she “would like to see really aggressive regulations” curtailing such robocalls.

“Like you, I detest robocalls,” said FCC Commissioner Jessica Rosenworcel, who was the subject of the hearing due to her renomination for another five-year term. “America detests robocalls,” McCaskill insisted.

“I strongly agree with Sen. McCaskill,” said Sen. Richard Blumenthal, D-Conn. Commerce Committee ranking member Bill Nelson, D-Fla., said friends, including a former member of Congress, got rid of landlines to avoid unwanted robocalls. Sen. Ed Markey, D-Mass., sounded alarm Tuesday about the provision (see 1510270054).

"Giving one of the most abusive industries in the U.S. free rein to inundate people with robo-calls to their cellphones is a terrible idea," said Margot Saunders, counsel to the National Consumer Law Center, in a statement. “Cell phone calls can distract people while driving, interrupt them at their jobs, and needlessly impose a cost on struggling families by using up scarce minutes. Debt collectors regularly call land lines to harass and threaten friends, family, and even strangers with similar names to the debtor. No one will be safe from receiving abusive calls on their cell phones if this provision goes through.”

The White House disputed any great harms. “Changing this law will allow servicers to contact and inform student borrowers of their federal repayment obligations and benefits like Pay As You Earn, or Rehabilitation, in the case of a defaulted borrower,” the administration official said. “The Administration also believes that the Federal Government should ensure that all debt owed to taxpayers is collected as quickly and efficiently as possible and this provision could result in millions of defaulted debt being collected. Importantly, the provision allows for the FCC, in consultation with Treasury, to implement rules to protect consumers from being harassed and contacted unreasonably, and we expect them to do so.”

McCaskill opposes the provision but will probably vote for the deal, she said. Caucus leaders have urged support for the compromise budget, but some members voiced intense opposition to it. Budget opponents in the Senate include Sens. Ted Cruz, R-Texas, and Marco Rubio, R-Fla., both Commerce Committee members running for president, and others including Sens. Rand Paul, R-Ky., and Mike Lee, R-Utah.

“The whole issue of robocalls and do-not-call lists and all that sort of thing is something we need to be continually looking at,” Thune told reporters. “It is obviously a consumer protection issue, as you heard today. … I’ve talked to lenders who are concerned they’re not going to be able to make any calls to collect on people paying loans and that sort of thing. This particular issue, I don’t have big heartburn over. But moving forward, I think it’s an issue we’re going to have to take a closer look at and determine what those rules are.” He called the budget provision “a narrow piece” regarding student loans of a greater universe.