LEGISLATIVE UPDATE # 2 – SECOND REGULAR SESSION – 2004
1) BANKING BILLS HAVE HEARINGS & WORK SESSIONS
2) CARRY OVER LEGISLATION FROM 2003 WORKING THEIR WAY THROUGH COMMITTEES
3) MAJOR ISSUES – TAX REFORM; DIRIGO HEALTH; BALANCE THE BUDGET
4) REMINDER – BANKERS' DAY AT THE LEGISLATURE = MARCH 25
In the first 10 days of the Second Regular Session of the 121st Maine Legislature, a number of banking bills have already had their Public Hearings and Work Sessions. Legislative Leadership has asked its Committees to complete much of their work no later than early February, allowing the full Legislature more time to debate its major issues and adjourn in early April. In order to meet that deadline, Committees will move quickly on all proposals before them.
I. PUBLIC HEARINGS AND WORK SESSIONS ON VARIOUS BANKING BILLS
The Following banking-related LDs have had Hearings and/or Work Sessions the first 10 days of the Session:
LD 1638, AN ACT to Amend the Maine Consumer Credit Code Regarding Balloon Payments, was heard before the Insurance and Financial Services Committee Wednesday, January 7th, and had its Work Session on the 14th. As originally proposed, the bill only impacted certain credit sales and indirect loans, but the LD was amended to apply to all loans and any lender. As amended, Maine’s law will allow auto loans to have balloon payments beyond a term of 4 years. MBA POSITION: Support as Amended - STATUS: Unanimously Passed by Committee
LD 1775, AN ACT to Require Written Notice of Revocation of Durable Powers of Attorney was heard by the Judiciary Committee on Tuesday, January 13th. As a result of an unfortunate personal experience, the proponents requested having some form of appeal or review when the grantor revokes a durable power of attorney. Many groups including the Legal Services for the Elderly opposed the legislation, because it would increase risks of fraud against the grantor, would add administrative costs and may defeat the intentions of many grantors. MBA POSITION: Monitor Status: Work Session on Tuesday, Jan. 20th - Committee is expected to Oppose
LD 1781, AN ACT to Amend the Laws Governing Mechanic’s Liens was heard Wednesday, January 14th before the Judiciary Committee. While Maine Bankers and other groups could have supported a much more-narrowly worded change to the mechanics lien laws, as drafted it would extend the mechanics lien for an indefinite period and create confusion for construction lending. MBA POSITION: Oppose as drafted STATUS: Work Session Thursday, Jan. 22nd – Committee is expected to Oppose
LD 1802, AN ACT to Permit the Photocopying of Driver’s Licenses was heard before the Insurance and Financial Services Committee Wednesday, January 14th. This LD was introduced on behalf of the Maine Bankers Association, and MBA Compliance Committee. Chair Susan Norton, from the First National Bank of Damariscotta, testified for the Association. The LD had the support of the Maine Credit Union League, the Maine Association of Community Banks, the Maine Auto Dealers, New England Financial Services Association, and certain real estate title attorneys and ultimately by the Secretary of State’s Office. After discussions with the Secretary of State’s office, they supported the bill and offered an Amendment. This Amendment clarifies how financial service providers must securely store the identification, and restricts how they may distribute the information. MBA POSITION: SUPPORT STATUS: Work Session Tuesday Jan. 20th – Committee will support as Amended
II. 2003 CARRY OVER LEGISLATION BEING ACTED UPON
A number of carry over LDs are being worked on, either by Study Group, in Committee or before the full Legislature – as follows:
LD 286, AN ACT to Title Mobile Homes, Boats, ATVs and Snowmobiles, was studied by the Secretary of State’s Office, with all interested parties including MBA during the summer and fall. The original bill was introduced by the Maine Credit Union League, but was opposed by many groups impacted by the titling requirement. MBA supported titling mobile homes, but not the other vehicles. The Study Report will be released before the Judiciary Committee the week of January 26th. The Sec. Of State’s Final Study Report will recommend NOT titling Boats, ATVs and Snowmobiles, and raises several issues prior to titling mobile homes.
LD 692, AN ACT to Protect Consumer Privacy Rights, was passed in the full House, and will be held in the Senate for debate later in the Session. This LD prohibits certain businesses from denying sale of goods or services because the consumer won’t provide their social security number. This carry over was studied during the summer and fall, and the final amended version exempts all financial transactions extending credit, or accessing a credit report. MBA POSITION – Opposed original LD, Neutral on Amended version. STATUS: Tabled in Senate
LD 921, AN ACT to Enable the Uniform Trust Code, required a very extensive study and proposed re-write of Maine’s Uniform Probate Code prior to enacting the Uniform Trust Code. The Trust Committee of the Maine Bankers Association had voted to support adopting the Uniform Trust Code, but only after amending the Probate Code. Many trust officer and trust and estate lawyers worked jointly to draft the needed changes, and a final report and final draft of this effort will be presented to the Judiciary Committee in early February.
LD 969, Mortgage Volume Fees, was studied during the summer and fall, and a final study report will be released in a few weeks. The original LD proposed shifting fees supporting the Office of Consumer Credit Regulation from mortgage companies to other users of the Office. The Study reviewed the OCCR’s various funding sources for equity purposes. MBA POSITION: Opposed the original LD, will monitor the final Study Report and any accompanying legislation.
LD 1360, AN ACT to Create a No-contact List and Prohibit Unsolicited E-mail, has been table in the Senate, possible for the remainder of the Session. While many interested parties thought this proposal was dead, the Attorney General’s office has asked the Senate to table the bill in case the AG believes he needs legislation to amend Maine law as a result of federal changes to telemarketing and privacy laws. Another Spam bill was enacted into law last year, and most business groups believed that was the only change that would take place. MBA will closely monitor this situation, as a strict “Do Not E-mail” law would restrict a number of financial transactions.
III. MAJOR LEGISLATIVE INITIATIVES
As discussed in the first Legislative Update, there will be three major policy initiatives dominating the attention of legislators in 2004.
On Tuesday, January 20th, the Governor will give his “State of the State” address, where he is expected to discuss efforts to balance the budget and to gain tax reform. Many interest groups are complaining that proposed budget cuts are too deep – the University system, the state Court system, and recipients of Department of Human Services programs are crying the loudest. The other option, of course, is to increase taxes. One “rumor” circulating the state house Friday was that the Governor might propose to reduce spending on the BETR program, a tax program benefiting businesses that invest in manufacturing equipment.
Meanwhile, on tax reform, meetings between the Governor’s office and Maine Municipal Association officials are ongoing, hoping to reach a compromise prior to the June referendum vote on the MMA’s proposal to have state government fund more of the cost of local education. Should the MMA referendum pass the state budget deficit will be greater by approximately $260 million per year!
Finally, on Dirigo Health, the self-insured employers are expected to have a position paper for the Dirigo Board by the end of January. One of the requirements of the Dirigo Legislation was that self-insurers review how a 4% assessment would be levied against their plans if and only if Dirigo resulted in reducing the cost of health care in Maine. MBA has been involved in this process on behalf of its MEWA and also for larger individually self-insured employers. The key issue is who determines and how you define “savings” in health care costs.
REMINDER: BANKERS’ DAY AT THE STATE HOUSE IS MARCH 25TH!
