February 5, 2003
LEGISLATIVE UPDATE #3
· ROBERT MURRAY APPROVED AS COMMISIONER
· MBA TRUST COMMITTEE PLANS FOR LEGISLATIVE ACTION
· MBA BILLS PRINTED
· MANY BANKING-RELATED LDS WAITING FOR PUBLIC HEARINGS
· MBA’S LEGISLATIVE COMMITTEE TO MEET ON 4TH TUESDAYS
· BANKERS DAY AT THE LEGISLATURE ON APRIL 8TH
As we move into February the major issues for the First Regular Session of the 121st Maine Legislature are taking shape. We have written before that there will be three prevailing issues this year – Passing a balanced budget in the face of the Billion dollar shortfall; Tax Reform; and Health Care. Add to that some major banking/business issues such as predatory lending, telemarketing rules and Do Not Call lists, Opt in privacy battles, a dozen or so specific banking/consumer credit code proposals, Maine Bankers’ Trustee process bill, workers comp issues, and mandatory paid family medical leave, and you see that the industry is bracing for an active, possibly turbulent Session.
· ROBERT (BUDDY) MURRAY APPROVED AS COMMISSIONER
Buddy Murray, a former legislator and currently a lawyer in Bangor has been approved as the next Commissioner of the Department with oversight of banking, insurance and securities issues. MBA President Joe Pietroski testified in support of the Nomination, which was approved unanimously first by the Insurance and Financial Services Committee, and then by the full Senate. Maine Bankers Association expects to build a good working relationship with the new Commissioner, who is invited to meet with the Maine Bankers Association Board of Directors at their March 6th Board Meeting.
· MBA TRUST COMMITTEE PLANS LEGISLATIVE ACTION
Maine Bankers Association’s Trust Committee, chaired by MBA Second Vice Chair Kathy Underwood from Key Bank, met January 30th and reviewed several trust-related legislative proposals. First, the Committee urged Maine Bankers Association to continue its opposition to any state budget that did not conform to the federal estate tax changes. If Maine assesses higher estate taxes than those under the federal estate tax, and because many states including Florida and New Hampshire do conform to the federal, Maine will lose estate business.
After extensive discussion the Trust Committee requested the trust banking industry join with the Maine Bar Association to work on an extensive re-write of the Maine Probate Code. These amendments to the Probate Code will be necessary in order to adopt the Uniform Trust Code, which is being proposed before the Legislation this year. Trust experts, both bankers and lawyers, support adoption of the Uniform Trust Code, but only after Maine’s Probate Code is updated with some uniform amendments that have not yet been adopted in Maine. Several Trust Committee members agreed to serve on a Joint Task Force with members of the Trust and Estate Section of the Maine Bar Association to develop the needed changes to Maine’s Uniform Probate Code. This Task Force will work over the spring, summer and fall to craft the changes. Maine Bankers Association will ask the Legislature to carry over the Uniform Trust Code proposal until 2004, pending the Task Force’s revision to the Probate Code.
· MBA BILLS PRINTED
LD 485, AN ACT Clarifying the Maine Consumer Credit Code, is MBA’s request to conform certain treatment of late fees to federal law. Offered at the suggestion of MBAs Compliance Committee, this bill is similar to several other Consumer Credit Code revisions that are sought by both the Maine Credit Union League and the Maine Association of Community Banks. This bill addresses late fees on real estate related loans when a borrower is more than one payment behind.
AN ACT to Clarify and Improve Fairness of the Law of Trustee Process is in possession of its primary sponsor, Rep. Bill Norbert, so will be printed in the next 5 days. This major industry-supported proposal amends the law over trustee process so as to designate with the Secretary of State the specific office for service of process, and to limit damages for failure to follow procedures to the amount in their account at the time of the process. This proposal will go to the Judiciary Committee early in March.
· MANY BANKING-RELATED LDS AWAITING PUBLIC HEARINGS
The following LDs have been printed and will be scheduled for Public Hearing in the near future:
LD 171, AN ACT to Require the Superintendent of Financial Institutions to Adopt Rules Regarding a Conversion of a Field of Membership by a Credit Union, proposes to allow the Superintendent, by means of Rulemaking to allow a credit union to convert from a select employer group base to a community based credit union AND continue to retain one or more of its SEG groups prior to the conversion. This proposal would go beyond what federal law currently allows in field of membership conversions, but does have the opportunity for public comment and does require a conversion and not a combination of two distinct types of field of memberships. This LD will be heard Wednesday, February 19th before the Insurance and Financial Services Committee.
LD 286, AN ACT to Title Mobile Homes, Boats, All-terrain Vehicles and Snowmobiles was introduced on behalf of the Maine Credit Union League and would require titles for all the above vehicles. MBA’s Legislative Committee has voted to support titling for mobile homes, but not to support a titling requirement for the other vehicles. This is a major proposal, requiring significant state, local and industry resources to handle the new certificates of title for these vehicles. A similar proposal was discussed, though never formally introduced, when Maine adopted new UCC Article 9.
LD 291, AN ACT to Provide Parity in Lending by State-chartered Lenders also was introduced on behalf of the Maine Credit Union League, and addresses non-conformity in Maine law with federal rules over late fees.
LD 428, AN ACT to Eliminate the Department of Professional and Financial Regulation, Bureau of Insurance Travel Restrictions for Obtaining Health Care, would amend a regulation, Rule 850, which has caused some local providers of health care to gain unfairly restrictive monopolies. As a result, these providers do not join networks and do not negotiate group discounts since health plans and their patients are forced to use these local providers. The Superintendent of Insurance stated that this change would have the greatest impact on cost of some medical services of any health care proposal.
LD 473, AN ACT to Limit the Interest Rate on Consumer Credit Transactions would limit the rate of interest that may be charged on all consumer credit including credit cards and auto loans to 12%.
LD 494, AN ACT to Enhance Consumer Protections in Relation to Certain Mortgages is introduced on behalf of the New England Financial Services Association, which represents finance companies including Household and CitiFinancial, and proposes to make certain changes acceptable to the finance companies on predatory lending and high rate mortgages.
· MBA LEGISLATIVE COMMITTEE NOW MEETS ON THE LAST TUESDAY OF THE MONTH – NEXT MEETING IS FEBRUARY 25TH
The regular meeting day for the Maine Bankers Association’s Legislative Committee is now the 4th Tuesday of the month. The next MBA Legislative Committee is Tuesday, February 25th at 9:30 at the Augusta branch of Northeast Bank. The Committee will meet on March 25th, April 29th, and May 27th at Northeast Bank.
· BANKERS DAY AT THE LEGISLATURE IS APRIL 8, 2003
Preparations are already in progress for the 2003 Bankers Day at the Legislature – we are hoping for nearly 200 bankers this year to shadow their local legislators! Watch for more information and sign up information in the next month!
