Closed committee meetings are typically wonkish, routine affairs. But Friday’s session of Republicans on the House Financial Services Committee broke that pattern in spectacular fashion, laying bare the growing acrimony and sense of disorder within the House Republican Conference.

It started, according to multiple sources present, when Committee Chairman Jeb Hensarling (R-Texas) told members that subcommittee chairmen are expected to pay their dues to the GOP’s campaign arm and to side with leaders on procedural votes that are critical to their ability to control the party’s legislative agenda.


Hensarling was complying with recent demands for such loyalty from Speaker John Boehner (R-Ohio) and House Majority Leader Kevin McCarthy (R-Calif.). But his message seemed squarely aimed at one lawmaker: New Jersey Rep. Scott Garrett. A Hensarling ally who chairs a prized Financial Services subcommittee, Garrett has angered GOP leaders and many members of the committee. He voted against Boehner’s bid for another term as speaker, bucked leadership on a critical procedural vote and has refused to pay National Republican Congressional Committee dues.

Garrett first responded that his procedural vote against leadership was a matter of conscience. Then he stunned the room with this explanation: He had not supported the NRCC in the past, he said, because it actively recruited gay candidates and supported homosexuals in primaries.

Some lawmakers grew noticeably angry, pointing out that the NRCC does not get involved in primaries, nor does it care about the sexual orientation of candidates. Rep. Patrick McHenry (R-N.C.), a member of leadership who led the NRCC’s candidate recruitment during the 2014 election cycle, said that Richard Tisei, a gay Republican whom the NRCC supported, was “equally homosexual” when Garrett donated directly to him in 2012, according to a source present.

Garrett, according to a source with knowledge of the situation, has cut a deal of sorts. He has agreed to donate to the NRCC’s building fund and recount efforts, but not to the committee directly. Garrett’s office did not respond to requests for comment. The NRCC’s policy is that it does not discriminate based on sexual orientation.

The episode, recounted by multiple sources present, illustrates how the Financial Services Committee has become ground zero in the battle between Republican leaders and the energized conservative wing of the House GOP conference.

Leadership’s push to enforce party unity strikes at the heart of the panel, which oversees Wall Street and is one of the more powerful committees in Congress. Garrett is a member of the House Freedom Caucus, a group of conservatives that is slowing the GOP leadership’s agenda, but he also holds a subcommittee gavel. Hensarling voted for Boehner for speaker but is often mentioned by conservatives as a possible candidate for a leadership slot.

Hensarling has also been the leading opponent of the Export-Import Bank, the recently expired government-backed institution that helped support U.S. companies who conduct business abroad. Boehner has said “thousands of jobs … would disappear pretty quickly if the Ex-Im Bank were to disappear.” The speaker said he will allow Hensarling to try to kill the bank if the Senate extends it as part of a must-pass bill. Hensarling, however, will likely lack the votes to do so.

Unlike the Republican conference writ large, the financial services panel is composed of more middle-of-the-road, establishment conservative lawmakers than rabble-rousers. And those forces are sniping at Hensarling’s politics and policy.

Lawmakers complain that he hasn’t held a markup since May. Three bills were pulled from consideration this week. K Street has long been frustrated with Hensarling’s management of the committee and what they see as his refusal to compromise to get legislation passed.

In turn, lawmakers on the premier committee are actively considering ways to stifle him. Some Republicans, who spoke without attribution to discuss internal conversations, say they would attempt to band with Democrats to overrule Hensarling in committee when he begins to mark up bills.

But even those who are frustrated say they can’t do much to get around Hensarling.

“In the short answer, of course, the chairman is the chairman, for the next year-and-a-half, and more likely, for the next 3½ years,” said Rep. Frank Lucas (R-Okla.), who briefly considered a bid to unseat Hensarling. “But we do live in a time where there’s a lot of frustration within the conference in a variety of directions. Who knows when that will actually come to a boil.”

David Popp, Hensarling’s spokesman, declined to comment on the closed committee meeting but defended the committee’s productivity.

“The committee has marked up more bills during the first six months of the 114th Congress than it did during the first six months of the 113th Congress,” Popp said. “Just this week, 11 committee bills were considered on the floor, and to date only two other committees have had more bills pass the House. At the beginning of the year, all Republican members of the committee agreed to a committee agenda for the 114th Congress, and the committee is on schedule in fulfilling that agenda.”

Rep. Randy Neugebauer, a fellow Texas Republican, said he has a “very good” relationship with Hensarling.

“He has policy views that not everybody agrees with, but he’s been very open with that, and I feel like he’s listened to everyone’s viewpoint,” Neugebauer said in an interview. “I don’t sense a big problem.”

Rep. Ed Royce (R-Calif.), who is also on the panel, said he thinks Hensarling is “doing a good job.”

Some of the frustration is rooted in Hensarling’s staunch and unflinching opposition to the Export-Import Bank. Some Republicans on the panel believe a vast majority of its members want to extend the bank’s charter or, short of that, craft a bill to wind the institution down gradually in order to ease the sting of job losses. Hensarling wants to kill it for good, and he has not opened the door to other options.

Others gripe about what they consider the committee’s slow pace due to ideological fissures on the panel.

“I think we’re always a little bit concerned that we’re not getting anything done,” said Rep. Lynn Westmoreland (R-Ga.), a member of the committee. “Not necessarily any particular thing, but we’re always wanting to change the system and change some of the legislation that has been passed, but ultimately you can just do what you can do. You’ve got to have the votes to do it, and I think Jeb’s a good vote counter, so he’s probably doing what he could do, and what he can’t do, he just hasn’t been able to do.”

Hensarling’s tenure as chairman has been marked by other controversies. He made housing reform one of his first targets, but a bill he authored to eliminate the government lending institutions Fannie Mae and Freddie Mac didn’t garner enough support to make it to the House floor. He later struggled to pass a flood insurance bill before relenting to GOP leadership.

Hensarling did successfully strike a deal to extend the Terrorism Risk Insurance Act.

The Financial Services Committee is certainly not the only panel with drama. Just last month, House Oversight and Government Reform Chairman Jason Chaffetz of Utah attempted to strip Rep. Mark Meadows (R-N.C.) of his subcommittee gavel but was overruled by a majority of the committee. Meadows got his gavel back.

It’s yet to be seen whether Hensarling’s tough talk to his fellow committee members will result in Garrett ponying up.

The northern New Jersey Republican has not yet paid his dues to the NRCC. He has a serious opponent this cycle. Josh Gottheimer, a former speechwriter for Hillary Clinton and John Kerry, raised $412,000 last quarter and has almost $600,000 in the bank. NRCC Chairman Greg Walden of Oregon declined to say whether the campaign arm would get involved in that — or any —race.

“I’m not going to talk about who we’re going to support and who we’re not going to support anywhere across the line, because hopefully we don’t have to come into races like that,” Walden said of Garrett’s race. “He’s been able to raise a lot of money, he’s got a lot of money in the bank — close to $3 million. My preference is we have members who pay their dues in full.”

Zachary Warmbrodt contributed to this report.