Although the Senate finally voted Thursday to send regulatory reform to the president's desk, policy circles are already abuzz about what changes to seek in a "corrections" bill to fix problems with the legislation.
Top lawmakers have acknowledged another bill will be needed to clean up their bill to overhaul the financial system, in which many complicated provisions were decided near the end of a marathon 20-hour session.
"Everybody knows that there are many technical changes that will need to be made," said Cornelius Hurley, a banking and financial law professor at the Boston University School of Law. "Anytime that you slap stuff together at 5 in the morning, mistakes get made and need to be corrected."
The corrections would be yet another step in the marathon process to overhaul the financial system. On Thursday the Senate passed, 60 to 39, the version completed last month by a conference of members from both chambers.
But how far the corrections bill could go remains a question. Some said it may be confined to technical changes to better reflect congressional intent; others see an opportunity to make more substantive alterations.
Despite concerns raised by fellow lawmakers, Senate Banking Committee Chairman Chris Dodd and House Financial Services Committee Chairman Barney Frank refused to reopen the bill after making last-minute changes designed to ensure the legislation had enough political support.
Instead, the two chairmen said there would be a future bill to make corrections, and tried to reassure lawmakers that they have plenty of time to enact a bill before the regulatory reform legislation goes into effect.
"Anytime you have a 2,000-page bill there's always a technical corrections bill that comes at some point, because … there's always some things you want to look at," Dodd told reporters after wrapping up the conference committee at the end of June. "As I pointed out on this particular provision, none of the provisions go into effect for another year, so we have some time."
But Frank hinted during the final conference session that the next bill may go beyond "technical" repairs. The Massachusetts Democrat did not elaborate and told reporters he was unsure what issues would be tweaked or how in later legislation.
"I don't know yet," he said. "There were a couple of drafting errors. … Look, these people who work here do an enormously complicated job very well. There are some typos, some that would be considered technical, some which can't be considered technical and go beyond that. I don't know what the answer to that is yet … but yeah, you'll need a minor corrections bill, you always do for something this big."
How much lawmakers will be willing to tinker with the bill after it passes is unclear.
"There are two kinds of corrections you can do," said Oliver Ireland, a partner with the law firm Morrison & Foerster. "One of them is you do a corrections bill that is a cleanup and noncontroversial. You make a list of all the corrections with explanations and you send it around and if anybody on your committee objects, you take it off the list. But the idea is that you do a corrections bill on things that need real corrections: They got the wrong page, the wrong cross reference, something like that. On those corrections that would be noncontroversial there are probably a lot of them."
But there is another possibility, Ireland said.
"There are things that other people will call 'corrections,' like they'll look at a substantive word someplace and say that should have gone out; or an 'and' should be an 'or' or vice versa," he said. "Those can be pretty substantive and make a real difference."
Democrats and the Obama administration are counting financial reform as a major victory and would be unlikely to allow any changes to go through that could be perceived as watering the bill down.
Several observers said they expected lawmakers would have little appetite to touch it again before the elections unless some noncontroversial alterations were immediately pressing.
"Obviously there's a million loose ends. There's a million things people will want to change," said Kip Weissman, a partner with Luse Gorman. "We are really running out of time before the elections. … The only kind of technical corrections you would think you would see is something that everyone readily agrees kind of helps everybody."
Financial services lawyers, regulators and analysts are still poring over the legislation and identifying places where language is ambiguous, conflicting or does not correctly define or describe what it intends.
But deciding where to draw the line will be difficult. Even a change as simple as inserting or striking a word could have a big impact and once any corrections bill delves into making substantive changes, every interested lobbying group will be going to the mat for its issues.
"We would vehemently be opposed to the industry undercutting the bill," said Ed Mierzwinski, the consumer program director for U.S. Public Interest Research Group. "They are going to try to do that."
But that isn't stopping industry groups from drawing up a wish list and hoping they can refight lost battles.
Though no industry representative interviewed for this story sounded optimistic about the prospects of rolling back a provision to let the Federal Reserve Board regulate interchange fees for debit cards, the issue remains a priority for credit unions and banks alike.
Other targets are likely to include provisions dealing with derivatives; implementation of the Volcker Rule to ban proprietary trading and limit investments in hedge funds; the elimination of trust-preferred securities as Tier 1 capital; and autonomy given to the new consumer regulator.
Ed Yingling, the president and chief executive of the American Bankers Association (ABA), said his group is still analyzing the massive bill to find areas that need to be corrected. The problem, he said, is that a technical corrections bill that gains momentum instantly becomes a target for more controversial, substantive changes that can stop a bill dead in its tracks.
"There are dozens of changes we would like, but they're not technical corrections," Yingling said. "The scary thing is that even if you had a bill that had a lot of items that everybody agreed needed to be corrected, we've all seen how any bill at any time can be held hostage."
Yingling said he doubts lawmakers will have much appetite to reopen legislation this year unless there are some widely agreed-upon tweaks.
Still, he said a bill next year could benefit the banking industry if Republicans, as expected, pick up more congressional seats in both chambers.
"In the next Congress, you would at least have the opportunity, and we will certainly be looking at things we want to have changed," he said. "Next year you will get into — with a new Congress — that's where the line between technical corrections and substantive changes will come into play."
Yingling said that if any other group appears to be inserting its wish lists into a purported technical corrections bill, the ABA would follow suit.
"Part of it is always this issue of once we open the door to nontechnical, where do we stop?" he said. "And obviously if anybody else were to go up and seek a substantive change on a technical corrections amendment, we would be first in line with a long list, so that's the issue that you have and that's the danger where even a technical bill gets caught up."
Yingling placed eliminating or weakening the interchange amendment at the top of his list, followed by concerns over a proposed safe harbor in the risk-retention provision that he said left too much uncertainty and could reduce access to credit.
Camden Fine, who heads the Independent Community Bankers of America, said his group would also like to see the interchange amendment struck. Also on his wish list were putting more constraints on the consumer bureau by giving the prudential regulators more authority in its rulewriting and knocking the consumer director off of the board of the Federal Deposit Insurance Corp.