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March 22, 2019    

Legislators Working Hard with Only Five Days Remaining for 2019 Session

The Georgia General Assembly was in session Monday, Thursday and Friday this week with Tuesday and Wednesday devoted to committee work days. Today they completed day 35 of their 40-day session and are planning to complete the first year of their biennial on April 2. One of GBA’s priority bills is on the way to the Governor for signature, and our other two priority bills are eligible to be scheduled by the House Rules Committee for final floor votes. See below for more information about those bills as well as news of our efforts to derail a bill that was concerning many of our members related to PACE lending. A number of other bills we’re supporting or monitoring saw action. Next week the General Assembly will be in session Monday, Tuesday, Thursday and Friday with Wednesday reserved as a committee workday.
Williamson and Kennedy

GBA Priority Bill Ready for Governor’s Signature

We were delighted to see the Senate give final passage to one of GBA’s priority bills this week. The vote was unanimous and their action clears the bill for Governor Brian Kemp’s signature. The bill, HB 185, is the Banking Department’s annual housekeeping bill and was sponsored by Rep. Bruce Williamson (R-Monroe). Sen. John Kennedy (R-Macon) handled the bill in the Senate. Of interest to bankers, the bill includes provisions to eliminate barriers to forming de novo banks, eliminate appropriated retained earnings references since they no longer affect legal lending limits, and authorize background checks for trust company directors and officers. The bill also contains provisions affecting other entities the Department regulates. Special thanks to Department Deputy Commissioner for Legal Affairs Bo Fears and to GBA’s Bank Counsel Section Board of Directors chaired by Cavan Perry, The Citizens Bank, Nashville, for working together to craft the helpful legislation.

Other Priority Bills Awaiting Final Action

Committees voted to report GBA’s other two priority bills this week and they’re eligible for consideration by the House Rules Committee to schedule a vote by the full House
Chandler
Statute of Frauds. The House Judiciary Committee held a hearing, adopted helpful amendments and reported SB 37 by Senate Banking and Financial Institutions chairman William Ligon (R-Brunswick). GBA’s Elizabeth Chandler testified along with Sen. Ligon in support of the bill. The legislation clarifies that an agreement to modify, alter, cancel, repeal, revoke, release, or rescind a promise, agreement, contract, or commitment that is subject to the statute of frauds shall itself be in writing and subject to the statute of frauds. The legislation addresses a Court of Appeals decision that allowed an oral rescission of a loan guaranty even though the document stated a rescission would be in writing. Rep. Bonnie Rich (R-Suwanee) will be handling the bill when it comes to the floor as the House sponsor.
Kennedy
Shared Deposits. The House Banks and Banking Committee held a hearing and reported SB 157 by Sen. John Kennedy (R-Macon). The bill authorizes banks to offer multi-millions of FDIC insurance coverage to public depositors through an optional shared deposit program. The intent of the legislation is to give banks a way to avoid tying up securities collateralizing a public deposit. The State Depository Board will establish policies and procedures related to the approval of third-party service providers offering this product through banks. The Board will also establish procedures for the ongoing monitoring of participation in deposit placement programs. That rulemaking is due by the end of this year assuming the bill passes as expected. The State Treasurer serves as the administrative officer for that Board. Rep. Dale Washburn (R-Milledgeville) will be handling the bill when it comes to the floor as the House sponsor.
Brass

Author Pulls PACE Loan Bill from House Committee Calendar

In last week’s Legislative Update, we reported that a number of our members had expressed concerns about SB 162 by Sen. Matt Brass (R-Newnan) related to financing broadband services. The bill was being presented as a way to bring broadband to areas of the state with less optimal internet connectivity and also included language authorizing loans for hardening structures to help withstand weather events like hurricanes. However, since the loans authorized by the bill would get priority lien status over all existing liens other than tax liens, we related our members’ concerns about that to members of the House Energy, Utilities and Telecommunications Committee that was scheduled to consider the bill. Most legislators told us they were not aware of this significant fact and what effect it would have on the mortgage market or on traditional lenders with existing mortgages on the property. Most legislators felt the bill needed more study and absent that, were prepared to vote against moving the bill forward. Hearing of those discussions, Sen. Brass asked that the bill be withdrawn from the agenda and we do not expect further action this year. We’ll certainly continue to be involved providing information about the concept so legislators are fully aware of the track record of the specialty lenders who make these loans in other states. Obviously these types of loans are readily available from traditional lenders and with Fannie Mae, Freddie Mac and FHA raising red flags about mortgage loans with PACE loans attached, it’s important that the mortgage market not be disrupted just to accommodate the interests of a few national specialty lenders who see Georgia as an opportunity to expand their business model.

Committee and Floor Action on Other Legislation We’re Monitoring

A number of other bills we’re monitoring received consideration this week. Among those of most interest to bankers are:
  • Business Court. The House Judiciary Committee held a hearing, amended and reported SB 110 by Sen. Jesse Stone (R-Waynesboro). The Senate Judiciary Committee held a hearing and reported a similar bill HB 239 by Rep. Chuck Efstration (R-Dacula). The bills implement the statewide Business Court authorized by a constitutional amendment that passed in 2018 which GBA supported. The bills are now eligible for consideration by the House and Senate Rules Committees to schedule floor votes.
  • Rural Development – Broadband. The House Energy, Utilities and Telecommunications Committee held a hearing, amended and reported SB 2 by Sen. Steve Gooch (R-Dahlonega). The bill allows Electric Membership Corporations and their affiliates to provide broadband services. The amendment added language from HB 499 that permits any existing electric easements to be used to provide or expand access to broadband services. The bill is now eligible to be considered by the House Rules Committee for scheduling a vote by the full House. GBA supports.

  • Funeral Expenses for Intestate Depositors. The Senate Banking and Financial Institutions Committee held a hearing and reported HB 490 by Rep. Jason Ridley (R-Chatsworth). The bill increases the amount and shortens the time financial institutions are required to release deposits upon receipt of a proper affidavit to pay claimants for funeral expenses or expenses of last illness. The bill is now eligible to be considered by the Senate Rules Committee for scheduling a vote by the full Senate. GBA is monitoring.

  • Nationwide Multistate Licensing System and Registry. The Senate passed HB 212 by Rep. Clay Pirkle (R-Ashburn). The bill exempts certain retailers of mobile homes from registration under the state and national mortgage registration system. Sen. John Kennedy (R-Macon) handled the bill on the Senate floor. The unanimous vote cleared the bill for the Governor’s consideration. GBA monitored.

  • Title Insurance. The House passed SB 202 by Sen. William Ligon (R-Brunswick). The bill allows title insurance to be procured on a lender's security interest in personal property taken by the lender as collateral for a loan. The House vote cleared the bill for the Governor’s consideration. GBA monitored.

  • Appraisal Management Companies. The Senate unanimously passed HB 192 by Rep. Alan Powell (R-Hartwell). The bill is a substantial revision to the code relating to the operation of Appraisal Management Companies. The Senate vote clears the bill for the Governor’s consideration. GBA monitored.

  • 529 Savings Trust Accounts. The Senate Banking and Financial Institutions Committee held a hearing and reported HB 266 by Rep. Marcus Wiedower (R-Watkinsville). The bill doubles the state income tax deduction for contributions to Georgia’s 529 educational savings trust accounts. The bill is now eligible to be considered by the Senate Rules Committee for scheduling a vote by the full Senate. GBA is monitoring.

  • Recording Fees. The Senate Judiciary Committee held a hearing and reported HB 288 by Rep. Alan Powell (R-Hartwell). Among other things, the bill creates a flat filing fee for recording certain real estate and personal property with the clerk of superior court by raising the current base fee and eliminating the per page fee. The bill is now eligible to be considered by the Senate Rules Committee for scheduling a vote by the full Senate. GBA is monitoring.
Stone
Efstration
Gooch
Ridley
Pirkle
Ligon
Powell
Wiedower

Bills on GBA’s Tracking List

We added bills throughout the session that we are tracking to the State Issues page on our website. There were no new bills added to our tracking list this week.

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..