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February 8, 2019

Legislature Moving Quickly Through Session

The Georgia General Assembly was in session Tuesday through Friday this week completing Day 11 of its 40-day session. The first bill passed this year was to name the new judicial center in honor of former Gov. Nathan Deal, partly in recognition of his bipartisan leadership on criminal justice reform that has become a national model. Committees have also been active holding hearings on bills within their jurisdiction. Next week, the Legislature will be in session Monday through Friday. A resolution was adopted by the House and Senate that sets April 2 as the day the 2019 session will end.

More Disaster Money Coming to Farmers

The Georgia General Assembly is stepping up again to increase the loan money available to farmers suffering losses from Hurricane Michael. The Supplemental Appropriations bill passed by the House today adds $10 million to the $55 million approved during last Fall’s Special Session that created the SAFETY21 low interest loan program. If the provision remains in the bill as it works its way through the process and the Governor signs it as expected, the money should be available soon. The loan program is administered by the Georgia Development Authority and the average loan size has been around $290,000. There are more qualified applicants than money available. We understand the Authority will continue to process loans and contingently approve them should additional money come from a proposed federal disaster bill.

Senate Committee Considers Guaranty Bill

The Senate Banking and Financial Institutions Committee held a hearing on SB 37 by committee chair William Ligon (R-Brunswick) this week. The legislation is intended to restore the proper method of releasing or rescinding a written guaranty. Opposition to the bill surfaced from Sen. Jesse Stone (R-Waynesboro) as the bill as drawn could be interpreted to apply to areas other than of concern to us. Sen. Ligon is looking at options to narrow the scope of the bill and we expect to see another draft soon. Our thanks to GBA’s counsel, Bill Custer of Bryan Cave Leighton Paisner, for testifying at the hearing on our behalf. As background, a 2018 Georgia Court of Appeals case, Crop Production Services, Inc. v T. E. Moye, reversed two cases going back nearly three decades which held that the Statute of Frauds barred oral evidence that a written guaranty had been released or rescinded. In Moye, the court held that a written guaranty may be rescinded by a mutual oral agreement, even though the guaranty itself is subject to the Statue of Frauds and contains a provision requiring that notice of revocation must be in writing. Because the creditor technically “won” this case because the summary judgment granted to the guarantor was reversed and remanded to the trial court to determine a question of fact, an appeal is unlikely. Therefore, legislation is needed to correct this decision that could have a profound impact on lending in Georgia.

Second Priority Bill Introduced

Our thanks to Rep. Bruce Williamson (R-Monroe) for introducing HB 185, the Department of Banking and Finance’s annual housekeeping bill. The bill includes provisions to eliminate barriers to forming de novo banks, eliminates appropriated retained earnings references since that no longer impacts legal lending limits, authorizes background checks for trust company directors and officers, among other provisions affecting other entities the Department regulates. GBA’s Bank Counsel Board of Directors reviewed the draft last year, and we support the legislation as introduced.

Other Banking-related Legislation Receiving Attention

A couple more issues we’re supporting or monitoring on behalf of our members received attention this week. Here’s an update on two:
  • Shared Deposits for Public Depositors. We’ve signed off on a draft bill that gives banks the ability to offer unlimited FDIC insurance to cover certain public deposits and we expect the bill to be introduced soon. A number of our members already offer this service to private sector depositors, usually through third parties such as StoneCastle Partners or Promontory Interfinancial Network. The legislation opens this type service to public sector depositors. GBA supports.
  • Electronic Filing – Courts. The Senate Judiciary Committee held a hearing on and reported SB 38 by Sen. William Ligon (R-Brunswick). The bill excludes certain filings such as those related to the enforcement of child support orders from being entered into the clerk of court’s electronic filing registry. GBA monitoring.

Bills We’ve Added to our Tracking List This Week

We add bills daily that we’ll be tracking to the State Issues page on our website and include all the new bills in each week’s Legislative Update. Here’s a list of the bills we added this week:
  • Income Tax - Hurricane Michael Relief. HB 105 by Rep. Sam Watson (R-Moultrie) would exempt federal disaster relief payments to victims of Hurricane Michael from state income taxes. The bill has been assigned to the House Ways and Means Committee. GBA Supports.

  • Anti-discrimination. HB 19 by Rep. Sandra Scott (D-Rex) would create a comprehensive state civil rights law protecting individuals from discrimination in housing, public accommodations and employment. The bill has been assigned to the House Judiciary Committee. GBA monitoring.

  • Checks for Payroll. HB 110 by Rep. Tom Kirby (R-Loganville) would give employers the discretion to issue payroll for wages by check. The bill has been assigned to the House Industry and Labor Committee. GBA monitoring

  • Prized Linked Savings Accounts. HB 193 by Rep. Emory Dunahoo (R-Gainesville) authorizes banks and credit unions to offer a deposit account with a raffle component to encourage savings. The bill was assigned to the House Banks and Banking Committee. GBA supports.

  • Appraisal Management Companies. HB 192 by Rep. Alan Powell (R-Hartwell) is a substantial revision to the code relating to the operation of Appraisal Management Companies. The bill was assigned to the House Regulated Industries Committee. GBA monitoring.

GBA’s Advocacy Team at the Capitol

Led by GBA’s Senior Vice President, Government Relations, Elizabeth Chandler, GBA will be at the Capitol every day advocating on behalf of our members. Also at the Capitol are GBA’s government relations consultant Steve Bridges and GBA President and CEO Joe Brannen. With questions about GBA legislation, other issues of interest, or anything related to the legislative process, contact Elizabeth at 404.420.2027, Steve at 404.420.2037 or Joe at 404.420.2026..