The state legislative session has five session days remaining in the 40-day schedule, which will be spread out over the next two weeks (with hearings to continue in the “off” days). And with the end in sight, it is the time of year when all the issues are fluid, nothing is a given, and bills are amended quickly with new language – and sometimes amended with the full text of other unrelated bills that haven’t moved through the process this year. It’s been an intense week for credit union issues (including the passage of the bill containing credit union charter enhancements! Just some of the activity of interest to credit unions from this week included topics on:
Abandoned Mobile Homes: H.B. 381 by Rep. John Corbett (R-Lake Park) passed the Senate Judiciary Committee on March 12th with minor amendments. This is the legislation that GCUA has been engaged on that seeks to provide property owners a legal method of disposing of abandoned derelict mobile homes that are titled to someone other than the property owner, and has been monitored closely to ensure that proper notice is provided to any lienholder prior to disposal. While the bill seeks to resolve a negative issue, GCUA worked during the hearing process in the House to remove language that could create greater liability for past-due rent once the mobile home is abandoned, and continues to work with Rep. Corbett (who has been supportive of our changes) to ensure that what passes contains the provisions needed for lienholders.
Boat Titling: H.B. 357 by Rep. Ron Stephens (R-Savannah) attempts to institute a boat-titling process in Georgia which would be managed by the Department of Natural Resources to coincide with the registration process. The bill topic has languished for almost 20 years and has not had a warm reception with legislators. However, this issue took one more step forward in this year’s effort as it has passed the Senate Finance Committee on March 14th! The bill now moves forward to Senate Rules for consideration.
Business Courts: H.R. 993 by Rep. Chuck Efstration (R-Dacula) would create a statewide business court structure for specific complex business cases, and was heard in the Senate Judiciary Committee on March 12th. While a vote was not taken when it was heard this first time in committee, another hearing is anticipated as of press time.
Credit Freeze Changes: Two of the three separate bills that seek to remove the fee credit reporting agencies are permitted to charge consumers who request a freeze passed two different committees this week: the House Banking Committee on March 12th passed S.B. 376 by Sen. David Shafer (R-Duluth), and on March 13th the Senate Banking Committee passed the duplicate version from the House by Rep. Scot Turner (R-Holly Springs), H.B. 866. Both bills will continue to be monitored closely through the process for any changes that could impact lending operations.
Cybersecurity: One of the cybersecurity bills in the state Legislature, S.B. 315 by Sen. Bruce Thompson (R-White), was debated again in a House Judiciary Non Civil subcommittee on March 14th with multiple amendments to address concerns (and more changes are likely). This is the bill that seeks to address data breaches by criminalizing the unauthorized access of computer systems, and any pending changes will be monitored closely as the bill moves forward in the process, to ensure that credit unions are not tasked with unneeded burdens while still protecting data.
Elimination of Certain Tax Credit Programs: All throughout the summer, fall and winter months a study committee met to thoroughly review tax credit/exemption programs to weigh a return on investment, whether the programs are working, and whether they should (or should not) be continued. An output of these hearings was seen this week with the introduction of S.B. 328 by Sen. John Albers (R-Alpharetta), which seeks to eliminate three of the tax credit plans these hearings analyzed (drivers’ education, diesel, and a transportation fringe tax credit). This bill is scheduled to be debated by the full House on March 19th, and must return to the Senate for approval of the changes made last week to adjust for an unrelated statewide federal tax change.
Hemp Growers Study Committee: On March 14th the House Agriculture and Consumer Affairs Committee passed a study committee resolution, H.R. 1473 by Rep. Tom McCall (R-Elberton), which seeks to hold hearings in the off session on the challenges, problems and moving pieces around farmers growing hemp in Georgia. From a credit union perspective, this will be monitored from the perspective of what things could or could not be done by financial institutions if the state moves forward.
HOA Charges for Clearance Letters: H.B. 410 by Rep. Alan Powell (R-Hartwell) seeks to regulate what information HOAs share in letters requested for mortgage closings, and what fees could be charged, and has been hotly contested in the process. There have been multiple versions of the bill, and throughout it has been addressed to ensure that in the process to find a compromise it does not impact the lending operations at credit unions. The version that passed the full House on February 28th had a $250 cap on the fee that HOAs could charge; however, the committee debated lowering that fee cap to $100. The bill was not taken up for a vote, but another hearing is pending as of press time. It is being closely monitored to ensure that credit union operations are protected, and to ensure that HOA interests do not insert language to supersede the lien status of the lender.
HOA Issues: On March 14th a bill seeking to overhaul the condo/homeowner association law (H.B. 748 by Rep. William Bodie, D-East Point) was debated again in a House Regulated Industries hearing. While this bill on paper does not impact credit unions, all HOA bills are monitored closely as they create an avenue for HOA interests to attach language they have been pursuing to supersede the priority lien status of financial institutions.
Improvement Zones: On March 12th the House Banking Committee passed S.B. 358 by Sen. Michael Rhett (D-Marietta); this bill seeks to create banking improvement zones with the intent to encourage branches in areas where there are few options for financial institutions. The bill encourages cities and counties to utilize public funds as a quasi-incentive for banks but is problematic in its application and the expectations it sets, and will still need to overcome hurdles in the legislative process.
Payments Between Insurers and Health Providers: H.B. 818 by Rep. Lee Hawkins (R-Gainesville) passed the Senate Insurance and Labor hearing on March 12th. The bill is directed solely at the fees charged between insurance providers and doctors’ offices (and not at consumer transactions). This bill was modified earlier in the legislative process (to the positive) to make it explicitly clear that it is applied to those insurance payments to the provider, and to prevent insurance companies from requiring providers to accept only payment via virtual credit card.
Real Estate Issues-Sovereign Immunity: H.B. 791 by Rep. Chuck Efstration (R-Dacula) was debated in the Senate Judiciary hearing on March 12th. In the process earlier, this bill on sovereign immunity (where or when the state could be sued) had an amendment in that contains a provision that would make the process of quieting of title easier in instances where the state is a party. No vote was taken, but another hearing is anticipated as of press time.
Real Estate Issues-Fulton County: H.B. 1036 by Rep. Chuck Martin (R-Alpharetta) is a local bill that was introduced on March 12th. This is a local bill, which means it doesn’t follow the same rules of normal bills, moves quickly without vetting in a committee, and is generally voted in a “block” of local bills on the floor. However, this bill would alter how any instrument or interest with real property is conveyed in Fulton County (and only Fulton County) would require the tax parcel identification numbers (or numbers associations with any or all portions) are printed on the top of the first page of the instrument. This bill would create the unintended consequence of invalidating titles and disrupting mortgage lending (much less title insurance) for any loan that involves real property done in Fulton County. GCUA has been engaged with Rep. Martin as well as the State Bar of Georgia to draw attention to the concerns, and an amendment to protect the titles from being deemed invalid due to error is being pursued.
Self-Settled Trusts: H.B. 441 by Rep. Barry Fleming (R-Harlem), which is carried over from last year, seeks to permit a new form of trust account to be offered in Georgia, and is monitored closely to ensure that creditors have the capability to claim on assets that were included in making a decision on a loan (if the assets were placed under the trust afterwards). This bill passed on the full Senate on March 12th, however during the debate an amendment was added, and it is anticipated that it will be amended again in the House.
Study of Certain Tax Credit Programs: On March 14th the Senate Finance Committee stuck the language from S.B. 432 by Sen. John Albers (R-Alpharetta) onto another bill (H.B. 93). S.B. 432 is the bill to institute a state review of the 70 tax exemptions/credits for various income tax as well as sales and use tax, and touches groups such as the National Guard, churches, food banks, 4-H, disaster recovery and aquariums. None of the 70 tax credits being analyzed impacts credit unions; however, the bill will be monitored closely. Tax exemptions were analyzed all throughout the off session in 2017 and is expected to continue in the summer/fall of 2018.
TAVT: H.B. 327 by Rep. Shaw Blackmon (R-Bonaire) is the bill from last year that sought to make several changes to the TAVT process for autos, including addressing the “welcome to Georgia” tax people see when they move to the state upon transferring vehicles, among other changes. It would place used cars at the same tax calculation as new cars (the higher of book or retail price) if sold by a dealer, making those calculations consistent. For casual sales between individuals (and not a new or used car dealer), the fair market value would be the same as it is today. This bill is being watched closely to protect credit union auto lending operations, and the bill changed drastically in a Senate Finance subcommittee hearing which passed their amended version on March 14th. This bill will likely go into conference where more changes are to be expected, and will continue to be monitored closely.
Towed Vehicles: On March 13th S.B. 446 by Sen. Tyler Harper (R-Ocilla) was to be debated in the House Motor Vehicles committee but was put on hold for amendments; this is one of the two bills that seek to rewrite the towed-vehicle law so as to allow a streamlined process for abandoned vehicles to be disposed of. GCUA worked with the interested parties last year on a similar bill to ensure that the lienholder notification remains intact, and these new versions retain the notice. It will continue to be monitored closely to protect credit unions.
Trash Liens: H.B. 693 by Rep. Brett Harrell (R-Snellville) was debated in a Senate Natural Resources subcommittee hearing; this bill seeks to remove a provision in law that has allowed cities and counties to threaten the foreclosure of real property over the nonpayment of a trash bill. This effort of Rep. Harrell has been a multi-year focus to prevent fees being treated as the same level as taxes. The bill, which doesn’t remove the right to file trash liens, but changes the process to make it more transparent to the homeowner and less of a “super lien,” is not anticipated to move forward, but Rep. Harrell’s efforts will likely continue in 2019.