First Regular Session of the 122^nd Maine Legislature Convenes!

New Leadership Elected & New Committees Named

1) Maine Bankers Association participates in Maine Business Association Roundtable (MBART) Study on Maine taxes, and the various tax reform proposals

2) Maine Bankers Association Introduces Two Legislative Proposals

3) Banking & Banking-Related Proposals Printed

4) Banking Industry Earns Major Court Victory in Massachusetts

5) Bankers Day at the Legislature is April 5^th, 2005

6) Next Legislative Committee Meeting is February 3^rd, 2005

This is the first Legislative Update for the 2005 Session, the First Regular Session of the 122^nd Legislature.  Maine Bankers Association will publish these Updates weekly or bi-weekly throughout the Session, which should end in mid-June.  The Legislative Update will outline the progress of banking-related issues through the Legislative process.  At times we will ask bankers to contact local legislators, and there may be Action Requests via Capwiz also asking for contacts.  These requests followed by banker contacts form the backbone of the Association’s lobbying efforts – local bankers contacting local legislators have the greatest impact on legislative decisions on important banking-related legislation!

Since January 4^th, when the Legislature convened, more than 215 LDs have been printed of the 2,137 that have been filed to date.  This total does not include Governor’s bills, bills from Agencies, the Attorney General’s office, Study Commission legislation or after deadline proposals.  Of the 2,137 proposals

Many of these LDs will be assigned to the Insurance and Financial Services Committee, which has jurisdiction over banking bills.  Though in the past few years, we spend more and more of our time before other Committees, including Appropriations (budget-related proposals); Taxation; Business Research and Economic Development; and Judiciary.  Judiciary has jurisdiction over lien bills, bankruptcy and foreclosure issues, anything to do with trusts and estates, and most Uniform Law proposals.

1)      THE MAINE BUSINESS ASSOCIATION ROUNDTABLE (MBART), which includes the Maine Bankers Association, held press conferences On January 13^th to announce and present an independent Price Waterhouse/Coopers study on Maine’s tax system and analysis of the several reform proposals under consideration at the Legislature.  This Study may be found on the Maine Bankers Association Website, titled “Maine Tax Reform Considerations.”

2)       MAINE BANKERS ASSOCIATION INTRODUCES TWO PROPOSALS

AN ACT to Amend Maine’s Non-resident Income Tax Provisions (Sen. Mayo), and

AN ACT to Amend the Motor Vehicle Laws Relating to the Assignment of Security Interests (Sen. Savage) were introduced on behalf of the Maine Bankers Association.  The former would amend the non-resident income tax provisions that passed last Session, so as to provide an exemption from triggering the requirement to file for days spent in Maine for training and education, and for days spent in Maine managing/supervising/visiting a Maine affiliate or subsidiary of an out -of-state company.

The latter proposal would allow the sale, wholesale or securitization of a block of auto loans without having to file for new titles for each and every loan.  Most states allow this sort of sale of loans.

Neither has been printed as an LD at this time, but will in the near future.

3)      BANKING AND BANKING-RELATED PROPOSALS PRINTED

LD 6, AN ACT to Prohibit a Credit Card Processing Company from Charging a Termination Fee (Rep. Moody) – will have its Public Hearing before the Insurance and Financial Services Committee on Tuesday, January 25^th at 10:30 a.m.     MBA POSITION:  Oppose

LD 24, AN ACT to Provide for the Efficient Administration of Family Development Accounts (Rep. Bowen).  Several Maine banks participate in this program with local CAP agencies and other public entities.  (Not Yet Scheduled)  MBA POSITION:  Monitor

LD 41, AN ACT to Prohibit Credit Card Companies from Charging Late Fees on Certain Accounts (Rep. Schatz) would not allow late fees if the interest rate is above 12.5%.  Also up for Public Hearing before Insurance and Financial Services on Jan. 25th at 10:30.  MBA POSITION:  Oppose

LD 58, AN ACT to Support Payroll Processors (Rep. Lansley) There will be several proposals this Session dealing with the bonding requirement for payroll processors as a result of legislation passed in 2004.   MBA will monitor these LDs, though will ask that there be some form of supervision over and financial liability for payroll processors.  In the past, banks have suffered losses when payroll companies fail or commit fraud.  

LD 83, AN ACT to Prohibit Payment Card Skimming (Sen. Snowe-Mello) This type of crime is becoming more prevalent, and this proposal creates a separate crime of “skimming” your account information when using a card.  MBA POSITION:  Monitor, may speak in support because we support efforts to reduce fraud.

LD 112, AN ACT to Conform Maine Estate Tax Laws with Federal Estate Tax Laws (Rep. Curley) requests that Maine fully conform to the federal estate tax laws.  Other similar proposals will also be introduced, including one drafted by a group of estate tax lawyers with the support and participation of representatives from the Maine Bankers Association.  MBA POSITION: Support

4)      BANKING INDUSTRY EARNS MAJOR COURT VICTORY

The U.S. District Court in Boston ruled on Wednesday in favor of the Massachusetts Bankers and ABA, preempting state legislation that impeded bank sale of insurance.  The basis of their decision was that Congress had acted, allowing banks to sell insurance under the same rules as all others.  Any state law that attempted to place banks at a disadvantage would be preempted by Congress, and by Regulations issues by the Office of the Comptroller of the Currency.   The Massachusetts law set certain restrictions, such as prohibition against referrals, against referral fees, against separate barriers between sales locations and waiting period time constraints.

This Decision from the same US District Court with jurisdiction over Maine cases should apply to the sale of insurance by banks in Maine.  Maine law currently has restrictions as to when a bank, or agent acting on behalf of a bank, may solicit their customers while a loan application is pending. 

5)      BANKERS' DAY AT THE STATE HOUSE IS APRIL 5^TH!!

Mark your calendars now – Bankers Day at the State House is Tuesday, April 5^th.  As in prior years, bankers will meet prior to that day’s Session, connect with their Legislator, and shadow them for that day.  It’s been a huge success in the past, so plan ahead to join us in Augusta and meet your local legislator!

6)      NEXT LEGISLATIVE COMMITTEE SCHEDULE THURSDAY, FEBRUARY 3^RD

For 2005, the Maine Bankers Association Legislative Committee will meet the first Thursday of every month – the next meeting will be February 3^rd.  If you see or hear about issues before the Legislature that you would like to know about, or have positions for our industry to take – you can contact your bank’s Legislative Committee representative!