January 18, 2008
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| The Georgia General Assembly convened Monday of this week for what could be a session of monumental importance. In a speech at the Georgia Chamber of Commerce Eggs and Issues Breakfast, Speaker Glenn Richardson used the acronym WETTT to focus on the key issues: water, education, transportation, taxes and trauma care. Each of the issues comes with its own constituencies, budgets and competing proposals. The first day of the session, the House exerted its constitutional power to vote to override gubernatorial vetoes; and in a show of bipartisan support, 12 bills Governor Perdue had vetoed after the legislature adjourned last Spring were overridden. Among the 12 bills was GBA's number one priority bill from last session, H.B. 441, legislation which repealed an untended tax increase on banks estimated to be $7.5 million. Although the bill originally passed the House unanimously and |
passed the Senate with only two
dissenting votes, the Governor vetoed the bill saying the
Revenue Department would address our concerns through their
rulemaking process. GBA's Tax Advisory Committee gave the
Revenue Department a reasonable approach to minimize the tax.
However, the Department dismissed the suggestion and took the
position they could do nothing by regulation and stood by their
position the tax increase was justified. Rep. Johnny
Floyd (R-Cordele) introduced the override resolution, and it
was adopted 155-16. The bill is now pending in the Senate
Rules Committee where a hearing was held, but no decision has
been announced as to their intentions. |
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At the request of the Georgia Department of Banking and Finance, House Banks and Banking Committee Chairman, James Mills (R-Gainesville) and Allen Peake (R-Macon) introduced H.B. 921, a bill that would allow Georgia to participate in a nationwide system of mortgage lender and broker licensing. In a presentation to the GBA Board of Directors, Commissioner Rob Braswell explained the intent of the legislation is to create a database of mortgage lenders and brokers in order to track individuals and their licensing. Braswell said the system was a project of the Conference of State Bank Supervisors and he felt the legislation would be a positive |
benefit. The system is
designed to prevent lenders and brokers with regulatory problems
to simply move to another state to escape their past. The
system became operational this month in a number of states, but
it will be necessary for this legislation to pass in order for
the Banking Department to share information about Georgia
registrants and licensees. GBA supports the bill. |
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| Rep. Roger Lane (R-Darien) has introduced H.B. 918 which would remove the special status official bank checks are given in real estate settlements. Current law requires settlement agents to use collected funds to disburse settlement proceeds. The law provides four classes of checks can be used in lieu of collected funds: 1) official checks issued by federally insured financial institutions, 2) checks issued by HUD-approved lenders, 3) checks issued by a lender approved to do business in Georgia, or 4) checks issued from lawyers trust accounts. This bill would eliminate the first three categories of checks and require the checks to have cleared if they are to be used to disburse settlement proceeds. A number of our members have expressed concern about the difficulty this would create and told us they see no reason official bank checks ought not to retain their special status. The legislation is reportedly in response to |
a large mortgage bank that declared
bankruptcy and a significant number of outstanding settlement
proceeds checks were held up for a while until the bankruptcy
court released the funds. A number of closing attorneys
had to scramble to cover the checks they had used to disburse
funds. Our belief is that the lawyers themselves can
determine which checks they will accept in their practice and to
eliminate official bank checks is an overreaction to this one
mortgage bank's failure. The bill could result in most
closing agents only accepting wire transfers instead of checks.
The bill is pending in the House Judiciary Committee. GBA
opposes the bill. |
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The House Ways and Means Committee held several days of hearings this week on Speaker Richardson's legislation, H.R. 900, that would repeal the ad valorem taxes used for schools, and replace the lost revenue with a new tax on most consumer services. "Banking services" are among the services that would be subject to the new 4% sales tax. Most of the opposition to the concept has come from local government officials who have said the legislation takes away their local control. Revenue Commissioner Bart Graham went before the Committee this week to discuss the rulemaking process. When pressed to give specifics on the services that would be included with the various categories of new taxes, like "banking services," he stated the |
Department was not prepared to
respond with any specificity. Various industry groups have
not yet been asked to testify on the impact on their businesses;
however, we expect to be asked to give the committee input.
This issue was discussed at length at the recent GBA Board
meeting, and the staff was directed to be available as needed;
and to let the committee know the impact would be enormous, both
in terms of costs and increased burdens on bank staff. |
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| For two years we have been following various bills that would allow individuals to place a freeze on their credit files with the credit reporting agencies, such as Equifax, Experion and TransUnion. Leading the study of the issue has been Rep. Calvin Hill (R-Canton). He and the study committee have been diligent in looking at various other state proposals, taking input from consumers, the reporting agencies and various businesses that could be affected by the bill. The House Banks and Banking Committee this week reported a bill, H.B. 130, that would create the legislated rules as to how the freezes and thaws of individual credit files will work. A fee of $10 is included to compensate the credit reporting agencies for the service. Consumer groups which have been pushing for passage of the |
 bill have vocally criticized the fee and encouraged it be
reduced. As the bill will have a minimal effect on
financial institutions, we have been simply monitoring the
committee's work and consulting on various banking practices.
The bill contains exemptions for existing customer relationships
and requires a frozen credit file to be thawed within 15 minutes
of a consumer's request. The reporting agencies have said
they will not oppose the bill as all three major reporting
agencies already have voluntary plans in place. |
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| The Senate Rules Committee, chaired by Sen. Don Balfour (R-Snellville), has reported a bill that balances personal property rights with the right to bear arms. GBA has been closely monitoring legislation that would have forbidden employers from prohibiting employees from having guns on their premises if the employees were properly licensed to carry the gun. The Georgia Chamber of Commerce had led the fight on behalf of private property owners. The National Rifle Association was pressing for the bill. Governor Perdue weighed into the battle and urged a compromise when he said he could not support the NRA position. The bill as reported clearly reaffirms the rights of private property owners to determine whether or not to permit the introduction of firearms on their premises and provides a lengthy, near comprehensive list of exemptions for employers. |
A number of our members had expressed concerns for the safety of
their employees and customers with the wording in the original
bill. The new version addresses those concerns by allowing
property owners to forbid weapons on their property as long as
the rule applies to all who enter the property. Also in
response to a high profile grisly murder of a hiker at Vogle
State Park, the legislation includes a provision that allows
properly permitted weapons to be carried under certain
circumstances in state parks. The bill is expected to pass
the Senate. |
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| For many years legislation has been considered that would cause boats to be titled. Each time the concept has been considered, the legislation stalls due to competing interests opposed to either having to comply with a new regulatory burden or a state agency that was already strapped for resources. Rep. John Heard (R-Lawrenceville) began circulating a bill this week that re-opens the debate. In a conversation with GBA staff, he said he felt it was important to put the issue on the table again as boat theft in Georgia has reached unacceptable levels and without a title to track ownership, the problem could only expect to get worse. |
The bill calls for titling boats and
establishes a logical process for boat sellers and individuals.
Both the Department of Natural Resources and
Department of Revenue would be involved. Lenders have
long expressed an interest in having titles on watercraft,
especially due to the increasing size of the loans as well as
because of the transportability of the boats. Please let us have
your
feedback on the need for the legislation. |
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Contact GBA Staff Lobbyists With Questions |
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GBA's three lobbyists will be onsite at the Capitol all session to be available to legislators and staff as questions arise about the various bills that may affect the banking industry. If you have questions about any legislation pending, please call on these professionals for their help. Also, GBA's State Issues Page of our website will be updated daily during the session. |
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Georgia Bankers Association • 50 Hurt Plaza, Suite 1050, Atlanta, GA 30303 • Phone 404.522.1501 • Fax 404.522.9848 • www.gabankers.com |
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