HR-8373-119
Referred to the House Committee on Financial Services.
Sponsored by Sylvia Garcia (D-TX)
What it does
This bill would direct the Secretary of the Treasury, through the Office of Consumer Policy, to establish a grant program awarding funds to nonprofit organizations, community development financial institutions (CDFIs), and minority depository institutions that provide financial coaching services. Eligible recipients must serve low- and moderate-income individuals, majority-minority census tracts, or rural areas. The bill would authorize $100 million over fiscal years 2026–2028, with 55% going directly to service providers and 45% for subgrants and technical assistance. It would also direct the Office of Consumer Policy to research and develop standardized credentialing practices for financial coaches.
Who benefits
Low- and moderate-income households (those at or below 120% of Area Median Income) who would gain access to free or subsidized financial coaching. Residents of majority-minority census tracts and rural communities with limited access to financial services. Nonprofit community organizations, CDFIs, and minority depository institutions that would receive grant funding to expand operations. Financial coaches who would benefit from professional development and potential credentialing standards. Indirectly, local economies that may benefit from improved household financial stability in underserved areas.
Who is hurt
For-profit financial advisors and credit counseling firms that compete with subsidized nonprofit providers. Taxpayers who bear the cost of the $100 million authorization. Organizations that do not meet the eligibility criteria (e.g., for-profit entities, newer organizations under one year old) and are excluded from grant competition. Financial coaching certification bodies that currently operate independently and may face disruption if federal credentialing standards are developed. Applicants in higher-income or non-rural areas who fall outside the geographic and income targeting criteria.
Supporters argue
Supporters argue that low- and moderate-income households face documented barriers to financial stability — including high debt burdens, low savings rates, and limited access to trusted financial guidance — and that financial coaching has demonstrated measurable results, including improved credit scores and reduced financial vulnerability. They contend that community-based organizations are uniquely positioned to deliver culturally competent services, and that the $100 million investment over three years is modest relative to the scale of financial insecurity affecting tens of millions of Americans. They further argue that developing standardized credentialing would improve service quality and protect consumers from unqualified practitioners.
Opponents argue
Opponents argue that the bill creates a new federal spending program without clear evidence that government-funded financial coaching produces lasting, cost-effective outcomes at scale, and that the $100 million authorization could be better directed toward direct financial assistance or existing proven programs. They contend that the broad grant of discretion to the Treasury's Office of Consumer Policy — including authority to set credentialing standards and adjust funding proportions — raises concerns about administrative overreach and lack of congressional oversight. They further argue that the eligibility criteria, while well-intentioned, may exclude effective organizations and concentrate funding in ways that reflect political priorities rather than demonstrated community need.
Constitutional context
Congress's authority to appropriate funds for this program rests on the Spending Clause (Art. I, §8, cl. 1) and the Necessary and Proper Clause (Art. I, §8, cl. 18). The bill's delegation of credentialing standard-setting authority to the Treasury Director could face scrutiny under the nondelegation doctrine and, post-Loper Bright v. Raimondo (2024), courts would independently assess whether the statutory language sufficiently defines the scope of that authority rather than deferring to the agency's interpretation.
Checks and balances
The Executive Branch (Treasury/Office of Consumer Policy) gains new grant-making and standard-setting authority; Congress retains a check through the appropriations process, as the $100 million is authorized but not automatically appropriated, and could conduct oversight through the House Committee on Financial Services.
Historical precedent
The CFPB's Financial Coaching Initiative (2015–2019) similarly funded nonprofit organizations to deploy financial coaches to low-income and veteran populations, providing a direct federal precedent for this type of grant-based delivery model.