Legislators Prepare for Final Week of the 2008 Legislative Session
This week the Statehouse had its usual mix of thrills, chills and spills as “crossover” day came and went. Both the House and Senate were extremely busy over the past 10 days. Legislators and lobbyists are surveying the landscape to see what bills remain alive as they catch their breath before entering the final week of the session.
Wednesday, February 27, was “crossover” day. Approximately 400 bills “crossed over” by the deadline and remain alive at this point in the session. Historically, roughly 200 bills pass the Legislature each year and are signed into law. If historic trends hold, we can expect many more casualties in the week ahead.
Major Themes of 2008 Session Remain the Same
The Senate has passed many tax reduction bills, and the House of Delegates has sent its version of the teachers’ retirement system bill to the Senate. This bill carries a $78 million price tag.
A representative of the Governor’s Office noted this week that based on bills passed by one house or the other by crossover day, the Legislature has reduced the revenue side of the 2008-09 budget by $100 million (through various tax reductions) and increased the expenditure side of the budget by $100 million. The next week will witness the reconciliation of the $200 million budget gap that presents itself at this time.
At the center of the drama this week was the bill of greatest interest to bankers, SB 680. The week witnessed two major surprises, including a clerical and reporting error involving the tax credit amendment that was passed by the Senate Finance Committee last week. In the end, a bill in a form acceptable to and supported by bankers passed the Senate at approximately 7:45 p.m. on Wednesday. SB 680 is now in the House, single referenced to the House Finance Committee.
On Monday evening, the Senate Republicans were successful in amending SB 680 to accelerate reductions in corporation net income tax. The acceleration upsets the delicate fiscal balance of tax reductions and budget forecasts that was reflected in the Administration’s bill. After two days of hard work by the Administration, business groups, labor and others to return the bill to its original CNIT tax reduction schedule, SB 680 passed out of the Senate with the acceleration provisions intact. Most observers anticipate that the House of Delegates will restore the original schedule of CNIT tax reductions to SB 680 in the week ahead.
Both unexpected developments regarding SB 680 this week are representative of the sort of surprises that can befall any bill until passage. We will remain vigilant to preserve the changes to SB 749 that have been the focus of our work over the past 12 months and see that SB 680 passes the Legislature by midnight, March 8.
Paycard Legislation
The paycard bill, HB 4032, remains parked in Senate Finance. We have reached agreement with the bill sponsors on the language of a committee substitute, and anticipate that the bill will begin to move now that we are past crossover day.
Consumer advocate groups are calling for further amendments to HB 4032, beyond those amendments agreed to between banks and the bill sponsors. We remain cautiously optimistic that these further amendments will be rejected, and that HB 4032 will advance in a form desired by and acceptable to banks.
Security Breach
SB 340, the notice of security breach bill being advanced by the AARP, was the story of the day Thursday at the Legislature, as the House Judiciary Committee significantly amended provisions of the “agreed to” bill. The “agreed to” form of the bill reflects six weeks of hard work by numerous constituencies.
The good news for banks is that the provisions substantially exempting banks from the operation of SB 340 remain intact. Accordingly, if the bill passes in either its present form or its “agreed to” form, banks are protected. In the less likely event that the bill dies due to the actions of House Judiciary, that, too, is an acceptable outcome for banks. We will continue to monitor and report on the bill’s progress.
Division of Banking
SB 292 (allowing the Commissioner of Banking to collect certain unpaid penalties and invoices on bond claims) passed the Senate two weeks ago and presently rests in the House Judiciary Committee, where it is expected to advance without opposition in the days ahead.
SB 417 (the bundled rules bill that includes rules permitting the sharing of insurance commissions) is in House Judiciary, where it is expected to advance toward passage in the days ahead.
CDARs Legislation
The CDARs bill (HB 4692) has passed the House of Delegates. In the Senate, the bill has referenced to Government Organization, then Finance.
While the bill was pending in the House, the State Treasurer had expressed concern over and opposition to the pooled collateral and bankers’ surety company provisions of the bill. Through the efforts of your Association this past week, we were able to advance the bill with the CDARs provisions and the bankers’ surety company provisions intact. We will continue to actively advocate for this bill and report on this bill’s progress in the days ahead.
Other Issues of Interest
SB 332, dealing with tax refund anticipation loans, was passed by the Senate this week in a form acceptable to bankers. We anticipate this bill to continue to advance to passage over the next week.
The Senate has also passed the tow truck bill, SB 556. Prior to passage of the bill, we were successful in obtaining an amendment that exempts repossessions of collateral by financial institutions from the consent requirements of the bill. Accordingly, banks find the bill as passed by the Senate acceptable. The bill is expected to encounter opposition in the House of Delegates in the week ahead, and we will continue to monitor the bill.
Bills of Interest
Several bills opposed by bankers died at crossover day. Bills failing to clear the crossover day hurdle include HB 4007 (dealing with predatory lending abuses); HB 4563 (revamping state law regarding deed of trust foreclosures); and HB 2093 (prohibiting mandatory arbitration provisions contracts with consumers).
Immediately following is the current status of active bills of interest to bankers.
2008 Senate Bills - Title - Status
SB 193 - Allowing lenders' sale of home and automobile membership plans - Committee substitute passed Senate Banking & Insurance 2/13/2008; passed Senate 2/18/2008; to House Judiciary
SB 292 - Allowing Commissioner of Banking issue bond claims to collect certain unpaid penalties and invoices - Senate Banking & Insurance Committee substitute passed 1/30/2008; passed Senate 2/04/2008; passed House Banking & Insurance Committee with title amendment 2/21/2008; to House Judiciary
SB 332 - Providing regulations and disclosure requirements for anticipatory tax refund loans - Passed Senate Banking & Insurance with amendment 2/20/2008; Committee substitute passed Senate Judiciary 2/25/2008; passed Senate with amendment 2/27/2008; to House Finance
SB 340 - Requiring consumers' notification of information security breach - Committee substitute passed Senate Judiciary 2/21/2008; passed Senate 2/25/2008; to House Judiciary
SB 417 - Authorizing Department of Revenue promulgate legislative rules - Passed Senate Banking and Insurance Committee 2/01/2008; Committee substitute passed Judiciary 2/22/2008; passed Senate, with amendment 2/27/2008, effective from passage; to House Judiciary
SB 465 - Eliminating Business Franchise Tax - Passed Senate Finance, with amendments and title amendment 2/14/2008; passed Senate with amendments 2/25/2008; to House Finance
SB 556 - Requiring owner's or operator's prior written authorization to tow vehicle - Passed Senate Transportation and Infrastructure 2/22/2008; Committee substitute passed Senate Judiciary 2/25/2008; passed Senate 2/27/2008; to House Judiciary
SB 680 - Relating to corporate net income tax and business franchise tax; combined reporting - Passed Senate Finance with amendment 2/21/2008; passed Senate with amendment and title amendment 2/27/2008, made effective from passage; to House Finance
SB 731 - Relating to certain state, county and municipal depositories - Referred Senate Government Organization then Finance
2008 House Bills - Title - Status
HB 4018 - Renewing the West Virginia Small Business Linked Deposit Program - Passed, with amendment House Industry, Labor, Economic Development & Small Business 2/07/2007; Committee substitute passed Finance 2/19/2008; passed House 2/22/2008, made effective from passage; to Senate Government Organization then Finance
HB 4032 - Relating to payment of wages through a direct deposit system - House Industry, Labor, Economic Development & Small Business passed Committee substitute 1/31/2008; second reading dispensed; passed House 2/05/2008; to Senate Finance
HB 4156 - Permitting a governing body of a municipality to place a lien on property in an amount equal to the demolition and removal of a hazardous structure. - Passed House Political Subdivisions with amendment 1/31/2008; Committee substitute passed Government Organization 2/20/2008; passed House 2/25/2008; to Senate Government Organization
HB 4290 - Expanding the electronic commerce activities of the Treasurer and Auditor - Committee substitute passed Government Organization 2/24/ 2008; dispensed with second reference; passed House 2/26/2008; to Senate Finance
HB 4420 - Imposing corporate net income tax on certain regulated investment companies and real estate investment trusts used as tax sheltering vehicles (FN) - Committee substitute passed House Finance 2/20/2008; passed House 2/25/2008 with title amendment; to Senate Finance
HB 4421 - Repealing the corporate license tax and creating corporate license tax replacement fees - Committee substitute passed House Finance 2/22/2008; passed House 2/26/2008; to Senate Finance
HB 4692 - Permitting depositories of state, county, municipal and other public moneys to pool securities - Committee substitute passed House Finance 2/24/2008; passed House 2/27/2008; to Senate Government Organization then Finance
House Carry Over Bills - Title - Status
HB 2517 - Providing that the Board of Banking and Financial Institutions have the authority to approve acquisitions of out-of-state banks by WV state banks - Passed House Banking & Insurance with amendment 1/24/08; second reading dispensed; passed House with amendment and title amendment 1/29/2008; passed Senate Banking & Insurance 2/01/2008; second reference dispensed; passed Senate 2/06/2008; approved by Governor 2/14/2008. - ACTION COMPLETED