LEGISLATIVE UPDATE – TRACKING ALL BANKING/BUSINESS LDS
SECOND REGULAR SESSION, 119TH LEGISLATURE
This Report reviews all banking or business related legislation that MBA tracked for this past Session, the Second Regular Session of the 119th Legislature. The Legislature adjourned last week and will return on May 11th for "Veto Day." They will return to re-consider LDs that passed the Legislature but have been vetoed by the Governor, of which there will be five or more. There will also consider some additional unfinished legislative business including the prescription drug price board bill.
MBA SPONSORED BILLS:
(Unless otherwise indicated, all LDs passed into law will take effect 90 days after the end of the Session, which will be in August.)
LD 2259, AN ACT to Amend the Banking Code Regarding Interlocking Directors was unanimously passed by the Banking & Insurance Committee, then passed both the House and Senate and signed by Governor King as Public Law 546. This law took effect immediately upon the Governor’s signature, which was March 6th.
LD 2285, AN ACT to Amend the Maine Probate Code was passed by the Judiciary Committee, the full House and Senate and signed by the Governor as Public Law 571. This law clarifies the Maine Probate Code so that trust officers may be compensated based on the size of assets in the Trust.
LD 2400, AN ACT Clarifying Maine’s Mutual Fund Tax Laws was passed by the full House and Senate and will be signed this week by the Governor. MBA had this LD introduced and supported the bill with other business groups and the Administration. We expect that an announcement will be made within a few weeks of a major mutual fund company opening operations in Maine!
LD 2574, AN ACT to Harmonize State Financial Services Law with Federal Law was proposed by the Department of Professional and Financial Regulation. Once Section of this LD amends Maine’s Charitable Sales Solicitation Sales Act so that banks are exempt from this Act’s reporting requirements. Maine Bankers Association, the Department and the Bureau of Banking worked together to craft this section of the LD. It was passed by the Banking & Insurance Committee and then by the full House and Senate. Governor King signed this into Law as Public Law 656. With its Emergency Preamble it took effect when signed on April 10, 2000.
OTHER LDs
LD 750, AN ACT to Establish a Patient Bill of Rights was carried over from 1999 and seeks to expand rights of employees insured by HMOs. The business community and the Administration were concerned about expanding the insureds right to sue their HMO. Initially passed by both the House and Senate, Governor King met with proponents and told them he would veto this measure in the form presented to him. Both sides compromised, allowing the right to sue only after exhausting all other remedies and only after going through a review board, but the cap on non-economic damages would be $400,00. The Governor will support this compromise version and will sign this law.
PENSION TAX EXEMPTIONS – several LDs were proposed this session, and others were carried over from 1999 that would exempt certain amounts of retiree pension income. The Taxation Committee supported one LD, and there were several amendments offered on the floor of both the House and Senate. It was clear that all parties both in the House and Senate, and the Administration supported this proposal. Finally, the Governor included in the Supplemental Budget an exemption for all pension income, both public and private, of $6,000. This was passed by the House and Senate and has been signed by the Governor. MBA testified in support of making Maine tax friendly for retirees.
LD 1166, AN ACT to Establish OSHA Standards for Operators of Video Display Terminals was carried over from 1999 to determine if OSHA would write new standards for operators of video display terminals. After review this year the Labor Committee voted Ought-Not-to-Pass.
LD 1402, then LD 2591, AN ACT Relating to Telemarketing was passed by the Utilities Committee as amended, then passed the House and Senate, and was signed by the Governor as Public Law 694. This issue became one of MBA’s priority bills for the Session, and will also be an issue needing additional legislative clarification next Session. While debating this LD, the Committee adopted much of the language suggested by MBA. However, as the Committee and the telemarketing community focused on existing laws governing telemarketing it became clear that enforcement of a 1969 Maine law that may apply to telemarketers would create a compliance burden. At this time, the Attorney General’s office is not enforcing that law and has agreed to work with interested parties to clarify the law so as not to impact telemarketers.
LD 1824, AN ACT to Encourage Equity Equivalent Loans or Investments in Community Development Financial Institutions was passed by the Taxation Committee and by the House and Senate, but the cost of the proposal was not funded in the Supplemental Budget or otherwise funded. Therefore, it is dead for the Session.
LD 2072, AN ACT to Clarify the Admissibility of Electronic Records and Signatures
And LD 2557, AN ACT to Implement the Recommendations of the Blue Ribbon Commission to Establish a Comprehensive Internet Policy both were passed by the full House and Senate and signed into law. LD 2072 has been signed as Public Law 711, and LD 2557 is awaiting the Governor’s signature. Together, these LDs create a digitalized signature law in Maine, recognize electronic signatures as admissible evidence for many transactions, and adopt the Uniform Electronic Transfer Act (UETA) into Maine law. These LDs were supported by MBA as necessary to conduct e-commerce.
LD 2147, AN ACT to Ensure Just Cause Termination in Employment was a major proposal from organized labor opposed by MBA and other business groups. After considerable debate, the Legislature indefinitely postponed this LD.
LD 2182, AN ACT to Implement the Clean Vehicle Incentives Program was carryover legislation from 1999, was passed by the Natural Resources Committee, passed the full House and Senate and was signed by Governor King as Public Law 684. This law will create a Pilot Program to retire high pollution vehicles more than ten years old by having FAME administer a voucher program. The voucher can be redeemed for between $1,000 and $2,000 towards the purchase of a "low emission vehicle." Maine Bankers took an active role on this issue when the Committee considered having FAME administer a subsidized low interest loan program. This provision was defeated.
LD 2245, AN ACT to Adopt the Model Revised Article 9, Secured Transactions was studied during the summer by the Secretary of State and by sections of the Maine Bar Association. This Act was passed by the Judiciary Committee and by the full House and Senate, and signed by the Governor as Public Law 699. This major re-write to Maine’s Uniform Commercial Code was supported by MBA and will impact how banks and other creditor secure their collateral. The effective date for this Act is July1, 2001! Banks will need to adopt new procedures prior to then so watch for a MBA Compliance Program on the new Article 9 later this year!
LD 2263, AN ACT to Amend the State’s Fair Debt Collection Practices Act and to Provide for Nonprofit Debt Management Services was passed as amended by the Banking & Insurance Committee, then passed the House and Senate and was signed by the Governor as Public Law 560. This law requires registration and limited regulation of consumer credit counseling services.
LD 2283, AN ACT to Realign Capital Requirements for Specialty Bank Charters was proposed by the Bureau of Banking and reduces initial capital requirements for limited purpose bank charters. MBA supported this LD, which was passed by the Banking & Insurance Committee, the full House and Senate and was signed by the Governor as Public Law 539. This law was effective March 6, 2000.
LD 2357, AN ACT to Amend the Maine Seed Capital Tax Credit Program was passed by the full Legislature and awaits the Governor’s signature. This LD creates additional tax credit for investments in certain businesses, and included a specific additional tax credit program benefiting hi-tech industries. The Seed Capital Tax Credit Program is administered by FAME.
LD 2377, AN ACT to Prevent Contamination from Home Heating Tanks implements a program to remove certain outside oil tanks from personal residences. Rules have been developed but funding for the program has been delayed, and the new program will not begin until 2001. Banks need to be aware of the final program because of impact on mortgage and home equity lending.
LD 2373, AN ACT to Prevent Misuse of Mortuary Trust Funds was passed by the Business and Economic Development Committee, then passed the full House and Senate and was signed by Governor King as Public Law 590. Maine Bankers supported this minor mortuary trust law change.
LD 2516, AN ACT to Improve Standards for Public Assistance to Maine Employers was narrowly passed in the House and Senate and is on the Governor’s desk. However, there is a good chance the Governor will Veto this bill. This proposal originated as one of Senator Pingree’s "corporate accountability" bill and affects businesses that take advantage of the BETR program or TIFs by requiring these businesses to pay a so-called "Super Minimum Wage." The business only benefits by BETR or the TIF by the percentage of employees paid above the livable wage.
LD 2550, AN ACT to Ensure Cost Effective and Safe Highways in the State was passed by the Legislature and signed by the Governor as Public Law 676. This proposal was part of the anti-sprawl effort. Maine Bankers became involved with this proposal when proponents sought to limit the number of entrances to real property on any state highway to one entryway. This provision was dropped from the final law.
LD 2578, AN ACT to Provide for the Year 2000 Allocations of the State Ceiling on Private Activity Bonds, and LD 2684, AN ACT to Improve Oversight and Accountability of Student Loan Programs Funded with an Allocation of the State Ceiling on Private Activity Tax-exempt Bonds were passed after great debate and controversy. The subject matter for both bills was studied by the Commission Studying Allocation of Private Activity Bond Cap, which included MBA’s First Vice Chairman and Legislative Committee Chair Peter Blyberg. That Commission’s recommendations included creating a more formal bond allocation process and more oversight and accountability for the student loan agencies MELMAC and MELA. After months and months of study and legislative debate, these two acts passed with most provisions non-controversial. The one divided issue concerned the number of MELMAC Board members to be appointed by the Governor. Also, MELA must have its own Board review its operations and suggest changes for the next Legislative Session.
LD 2643, AN ACT Ensuring that Certain Land Transfers Accomplished Through Stock Transfers are not Exempt from the Transfer Tax proposed to expand the transfer tax to transfers occurring by corporate stock transfers. This issue was studied by the Taxation Committee over the summer and was aimed at large corporations that sold off large amounts of land, such as paper companies. However as finally drafted into LD form, it applied to virtually every sale of a corporation that owned real estate, including banks, Mom & Pop stores and other small businesses. The Taxation Committee supported the final proposal, which exempted bank-owned property that was acquired by foreclosure. The Senate passed that bill, but the House defeated it. In a Conference Committee between members of the prevailing vote in the House and Senate, they could not agree to a compromise. This issue may resurface when the Legislature returns for Veto Day.
LEGISLATIVE UPDATE – TRACKING ALL BANKING/BUSINESS LDS
SECOND REGULAR SESSION, 119TH LEGISLATURE
This Report reviews all banking or business related legislation that MBA tracked for this past Session, the Second Regular Session of the 119th Legislature. The Legislature adjourned last week and will return on May 11th for "Veto Day." They will return to re-consider LDs that passed the Legislature but have been vetoed by the Governor, of which there will be five or more. There will also consider some additional unfinished legislative business including the prescription drug price board bill.
MBA SPONSORED BILLS:
(Unless otherwise indicated, all LDs passed into law will take effect 90 days after the end of the Session, which will be in August.)
LD 2259, AN ACT to Amend the Banking Code Regarding Interlocking Directors was unanimously passed by the Banking & Insurance Committee, then passed both the House and Senate and signed by Governor King as Public Law 546. This law took effect immediately upon the Governor’s signature, which was March 6th.
LD 2285, AN ACT to Amend the Maine Probate Code was passed by the Judiciary Committee, the full House and Senate and signed by the Governor as Public Law 571. This law clarifies the Maine Probate Code so that trust officers may be compensated based on the size of assets in the Trust.
LD 2400, AN ACT Clarifying Maine’s Mutual Fund Tax Laws was passed by the full House and Senate and will be signed this week by the Governor. MBA had this LD introduced and supported the bill with other business groups and the Administration. We expect that an announcement will be made within a few weeks of a major mutual fund company opening operations in Maine!
LD 2574, AN ACT to Harmonize State Financial Services Law with Federal Law was proposed by the Department of Professional and Financial Regulation. Once Section of this LD amends Maine’s Charitable Sales Solicitation Sales Act so that banks are exempt from this Act’s reporting requirements. Maine Bankers Association, the Department and the Bureau of Banking worked together to craft this section of the LD. It was passed by the Banking & Insurance Committee and then by the full House and Senate. Governor King signed this into Law as Public Law 656. With its Emergency Preamble it took effect when signed on April 10, 2000.
OTHER LDs
LD 750, AN ACT to Establish a Patient Bill of Rights was carried over from 1999 and seeks to expand rights of employees insured by HMOs. The business community and the Administration were concerned about expanding the insureds right to sue their HMO. Initially passed by both the House and Senate, Governor King met with proponents and told them he would veto this measure in the form presented to him. Both sides compromised, allowing the right to sue only after exhausting all other remedies and only after going through a review board, but the cap on non-economic damages would be $400,00. The Governor will support this compromise version and will sign this law.
PENSION TAX EXEMPTIONS – several LDs were proposed this session, and others were carried over from 1999 that would exempt certain amounts of retiree pension income. The Taxation Committee supported one LD, and there were several amendments offered on the floor of both the House and Senate. It was clear that all parties both in the House and Senate, and the Administration supported this proposal. Finally, the Governor included in the Supplemental Budget an exemption for all pension income, both public and private, of $6,000. This was passed by the House and Senate and has been signed by the Governor. MBA testified in support of making Maine tax friendly for retirees.
LD 1166, AN ACT to Establish OSHA Standards for Operators of Video Display Terminals was carried over from 1999 to determine if OSHA would write new standards for operators of video display terminals. After review this year the Labor Committee voted Ought-Not-to-Pass.
LD 1402, then LD 2591, AN ACT Relating to Telemarketing was passed by the Utilities Committee as amended, then passed the House and Senate, and was signed by the Governor as Public Law 694. This issue became one of MBA’s priority bills for the Session, and will also be an issue needing additional legislative clarification next Session. While debating this LD, the Committee adopted much of the language suggested by MBA. However, as the Committee and the telemarketing community focused on existing laws governing telemarketing it became clear that enforcement of a 1969 Maine law that may apply to telemarketers would create a compliance burden. At this time, the Attorney General’s office is not enforcing that law and has agreed to work with interested parties to clarify the law so as not to impact telemarketers.
LD 1824, AN ACT to Encourage Equity Equivalent Loans or Investments in Community Development Financial Institutions was passed by the Taxation Committee and by the House and Senate, but the cost of the proposal was not funded in the Supplemental Budget or otherwise funded. Therefore, it is dead for the Session.
LD 2072, AN ACT to Clarify the Admissibility of Electronic Records and Signatures
And LD 2557, AN ACT to Implement the Recommendations of the Blue Ribbon Commission to Establish a Comprehensive Internet Policy both were passed by the full House and Senate and signed into law. LD 2072 has been signed as Public Law 711, and LD 2557 is awaiting the Governor’s signature. Together, these LDs create a digitalized signature law in Maine, recognize electronic signatures as admissible evidence for many transactions, and adopt the Uniform Electronic Transfer Act (UETA) into Maine law. These LDs were supported by MBA as necessary to conduct e-commerce.
LD 2147, AN ACT to Ensure Just Cause Termination in Employment was a major proposal from organized labor opposed by MBA and other business groups. After considerable debate, the Legislature indefinitely postponed this LD.
LD 2182, AN ACT to Implement the Clean Vehicle Incentives Program was carryover legislation from 1999, was passed by the Natural Resources Committee, passed the full House and Senate and was signed by Governor King as Public Law 684. This law will create a Pilot Program to retire high pollution vehicles more than ten years old by having FAME administer a voucher program. The voucher can be redeemed for between $1,000 and $2,000 towards the purchase of a "low emission vehicle." Maine Bankers took an active role on this issue when the Committee considered having FAME administer a subsidized low interest loan program. This provision was defeated.
LD 2245, AN ACT to Adopt the Model Revised Article 9, Secured Transactions was studied during the summer by the Secretary of State and by sections of the Maine Bar Association. This Act was passed by the Judiciary Committee and by the full House and Senate, and signed by the Governor as Public Law 699. This major re-write to Maine’s Uniform Commercial Code was supported by MBA and will impact how banks and other creditor secure their collateral. The effective date for this Act is July1, 2001! Banks will need to adopt new procedures prior to then so watch for a MBA Compliance Program on the new Article 9 later this year!
LD 2263, AN ACT to Amend the State’s Fair Debt Collection Practices Act and to Provide for Nonprofit Debt Management Services was passed as amended by the Banking & Insurance Committee, then passed the House and Senate and was signed by the Governor as Public Law 560. This law requires registration and limited regulation of consumer credit counseling services.
LD 2283, AN ACT to Realign Capital Requirements for Specialty Bank Charters was proposed by the Bureau of Banking and reduces initial capital requirements for limited purpose bank charters. MBA supported this LD, which was passed by the Banking & Insurance Committee, the full House and Senate and was signed by the Governor as Public Law 539. This law was effective March 6, 2000.
LD 2357, AN ACT to Amend the Maine Seed Capital Tax Credit Program was passed by the full Legislature and awaits the Governor’s signature. This LD creates additional tax credit for investments in certain businesses, and included a specific additional tax credit program benefiting hi-tech industries. The Seed Capital Tax Credit Program is administered by FAME.
LD 2377, AN ACT to Prevent Contamination from Home Heating Tanks implements a program to remove certain outside oil tanks from personal residences. Rules have been developed but funding for the program has been delayed, and the new program will not begin until 2001. Banks need to be aware of the final program because of impact on mortgage and home equity lending.
LD 2373, AN ACT to Prevent Misuse of Mortuary Trust Funds was passed by the Business and Economic Development Committee, then passed the full House and Senate and was signed by Governor King as Public Law 590. Maine Bankers supported this minor mortuary trust law change.
LD 2516, AN ACT to Improve Standards for Public Assistance to Maine Employers was narrowly passed in the House and Senate and is on the Governor’s desk. However, there is a good chance the Governor will Veto this bill. This proposal originated as one of Senator Pingree’s "corporate accountability" bill and affects businesses that take advantage of the BETR program or TIFs by requiring these businesses to pay a so-called "Super Minimum Wage." The business only benefits by BETR or the TIF by the percentage of employees paid above the livable wage.
LD 2550, AN ACT to Ensure Cost Effective and Safe Highways in the State was passed by the Legislature and signed by the Governor as Public Law 676. This proposal was part of the anti-sprawl effort. Maine Bankers became involved with this proposal when proponents sought to limit the number of entrances to real property on any state highway to one entryway. This provision was dropped from the final law.
LD 2578, AN ACT to Provide for the Year 2000 Allocations of the State Ceiling on Private Activity Bonds, and LD 2684, AN ACT to Improve Oversight and Accountability of Student Loan Programs Funded with an Allocation of the State Ceiling on Private Activity Tax-exempt Bonds were passed after great debate and controversy. The subject matter for both bills was studied by the Commission Studying Allocation of Private Activity Bond Cap, which included MBA’s First Vice Chairman and Legislative Committee Chair Peter Blyberg. That Commission’s recommendations included creating a more formal bond allocation process and more oversight and accountability for the student loan agencies MELMAC and MELA. After months and months of study and legislative debate, these two acts passed with most provisions non-controversial. The one divided issue concerned the number of MELMAC Board members to be appointed by the Governor. Also, MELA must have its own Board review its operations and suggest changes for the next Legislative Session.
LD 2643, AN ACT Ensuring that Certain Land Transfers Accomplished Through Stock Transfers are not Exempt from the Transfer Tax proposed to expand the transfer tax to transfers occurring by corporate stock transfers. This issue was studied by the Taxation Committee over the summer and was aimed at large corporations that sold off large amounts of land, such as paper companies. However as finally drafted into LD form, it applied to virtually every sale of a corporation that owned real estate, including banks, Mom & Pop stores and other small businesses. The Taxation Committee supported the final proposal, which exempted bank-owned property that was acquired by foreclosure. The Senate passed that bill, but the House defeated it. In a Conference Committee between members of the prevailing vote in the House and Senate, they could not agree to a compromise. This issue may resurface when the Legislature returns for Veto Day.
