General Assembly Ups the Pace

The pace of activity has quickened around the State Capitol as legislators scramble to perfect their bills in committee in order to get them to the floor before Crossover Day coming up next Thursday. Crossover Day is the deadline for a bill to pass its body of origin (either the House or Senate) in order to be considered by the other body as a standalone bill. Three GBA priority bills saw action this week and we appreciate the legislative sponsors for their diligence. Next week the General Assembly will be in session Monday and Tuesday before taking off Wednesday to finalize a long list of bills for Crossover Day on Thursday. They’ll also be in session next Friday that will mark day 29 of the 40-day session.

Banking Department Housekeeping Bill Passes House

In a rare unanimous vote, the House passed HB 185, the Banking Department’s annual housekeeping bill sponsored by Rep. Bruce Williamson (R-Monroe). The bill is now pending in the Senate Banking and Financial Institutions Committee. 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. GBA supports as one of our priority bills this session.

Senate Passes Guaranty Bill

After three committee hearings, the Senate Banking and Financial Institutions Committee slightly amended and reported SB 37 by committee chair William Ligon (R-Brunswick) this week. The bill was placed on the floor by the Senate Rules Committee chaired by Sen. Jeff Mullis (R-Chickamauga) and the bill passed earlier today. Our thanks to GBA’s counsel, Bill Custer of Bryan Cave Leighton Paisner, who drafted some revisions to the bill from input at the hearings and he testified again on our behalf. The legislation is intended to restore the proper method of releasing or rescinding a written guaranty. 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three decades which held that the Statute of Frauds barred oral evidence that a written guaranty had been released or rescinded. In Moye, the court held that a written guaranty may be rescinded by a mutual oral agreement, even though the guaranty itself is subject to the Statue of Frauds and contains a provision requiring that notice of revocation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. An agreement was reached with Sen. Jesse Stone (R-Waynesboro) on a slight amendment to address his concerns about certain disputed agreements. The bill now goes to the House where it will be assigned to a committee next week.

Shared Deposit Bill Reported from Committee

The Senate Banking and Financial Institutions Committee held a hearing on and reported SB 157 by Sen. John Kennedy (R-Macon). The bill authorizes banks to offer unlimited FDIC insurance 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 or collateralizing the public deposit with a Letter of Credit. GBA president and CEO Joe Brannen testified in support of the legislation as one of our priority bills for the session. GBA associate members StoneCastle Partners and Promontory Interfinancial Network are the two companies most active in Georgia selling this service to our members and representatives from Promontory asked that the legislation be introduced. The State Depository Board will establish policies and procedures related to the approval of third-party service providers and 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.

Update on Elder Abuse and Neglect Reporting Bill

In last week’s Legislative Update, we told you about our concern with HB 402 by Rep. Houston Gaines (R-Athens). The bill expands the current statute requiring bankers to report suspected cases of elderly financial exploitation to require reporting of instances of suspected elder abuse and neglect. The bill had been scheduled for a hearing this week in the House Committee on Human Relations and Aging. However, after learning more about our concerns, Rep. Gaines and committee chairman, Rep. Jesse Petrea (R-Savannah), decided to hold the bill for further study. Georgia banks are doing a great job reporting elder financial exploitation cases. In fact, the Department of Aging tells us that reporting is up over 200 percent just this past year. However, bankers are simply not in a position to detect cases of abuse and neglect as those terms are defined in the Georgia code.

Committee and Floor Action

A number of bills we’re monitoring received consideration in committee or were subject to floor votes this week. Among those of most interest to banking are:

Bank Tax Credit. The Senate passed SB 120 Sen. John Albers (R-Alpharetta) that is designed to study each of Georgia’s tax credits including the Bank Tax Credit. The bill will be assigned to a House committee next week.
Prize Linked Savings Accounts. The House passed HB 193 by Rep. Emory Dunahoo (R-Gainesville). The bill authorizes banks and credit unions to offer a deposit account with a raffle component to encourage savings. Earlier this week, the House Banks and Banking Committee adopted an amendment clarifies that participants will not be charged a fee to be eligible for the raffle component. The bill is now pending in the House Rules Committee. GBA supports.
Boat Titling. The House Ways and Means Committee held a hearing and reported HB 314 by Rep. Ron Stephens (R-Savannah). The bill creates a process by which boats and other watercraft will be titled. GBA supports.
Business Court. A House Judiciary Subcommittee held another hearing and reported to the full committee HB 239 by Rep. Chuck Efstration (R-Dacula). The bill implements the statewide Business Court authorized by a constitutional amendment that passed in 2018. GBA supports.
Rural Development Council. The House passed HR 214 by Rep. Sam Watson (R-Moultrie). The bill reauthorizes the Rural Development Council for an additional two years. Recommendations from the Council’s first two years of work are being enacted into law. These next two years will allow the legislators to continue looking for ways to support economic development and jobs for rural Georgia. GBA testified before the Council and supports this ongoing effort.
Rural Development – Freight and Logistics. The House passed HR 37 by Rep. Kevin Tanner (R-Dawsonville). The resolution creates the Georgia Commission on Freight and Logistics to make recommendations for a comprehensive strategic business plan to develop state-wide freight and logistics infrastructure with the intent of ensuring the state remains economically competitive. The bill has been assigned to the Senate Transportation Committee. GBA supports
Guardianship.The House passed HB 70 by Rep. Chuck Efstration (R-Dacula). The bill revises a number of areas within the code affecting guardianship of minors and adults. The changes mostly relate to appointment issues and court administration rather than bank operations. GBA is monitoring.
Hemp Farming. The House passed HB 213 by Rep. John Corbett (R-Lake Park). The bill establishes the framework for research, development, growing, licensing and regulating hemp production in Georgia as prescribed by the Federal Farm Bill that was enacted in 2018. GBA is monitoring.
Nationwide Multistate Licensing System and Registry. The House Banks and Banking Committee held a hearing, amended and reported HB 212 by Rep. Clay Pirkle (R-Ashburn).The bill exempts certain retailers of mobile homes and employees of residential contractors from registration under the state and national mortgage registration system. The amendment was made at the request of the Department of Banking and Finance to ensure the State of Georgia remains in compliance with the rules governing the multistate licensing system. GBA is monitoring.
529 Savings Trust Accounts. The House Ways and Means Committee held a hearing on and reported HB 266 by Rep. Marcus Wiedower. The bill doubles the state income tax deduction for contributions to Georgia’s 529 educational savings trust accounts. GBA is monitoring.

Banking Improvement Zone. The Senate passed SB 20 by Sen. Michael Rhett (D-Marietta). The bill provides an incentive for financial institutions to operate in underserved areas designated as Banking Improvement Zones by the Department of Community Affairs by allowing the local governmental entity to place deposits with a financial institution as long as the fixed rate of interest is at or below the institution’s posted two-year certificate of deposit rate. GBA is monitoring.
Recording Fees. A House Judiciary Subcommittee held a hearing on and reported HB 288 by Rep. Alan Powell (R-Hartwell). The Judiciary Committee passed the bill Friday. 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. GBA is monitoring.
Fraudulent Transfers. The House passed HB 396 by Rep. Dale Washburn (R-Macon). The bill provides that it shall be unlawful for a person with intent to hinder, delay, impair, or defraud a creditor's rights to deed or otherwise transfer title to real property to another person without the knowledge or consent of such other person. GBA is monitoring.
Self-settled Spendthrift Trust. The House Banks and Banking Committee held a hearing but took no further action on HB 497 by Rep. Bonnie Rich (R-Suwanee). The bill creates a new trust in Georgia that allows the creator of the trust to also be the beneficiary of the trust. A second hearing is scheduled for Monday of next week. GBA is monitoring.
Funeral Expenses for Intestate Depositors. The House Banks and Banking Committee held a hearing but took no further action on 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. A second hearing is scheduled for Monday of next week. GBA is monitoring.
Bank Data Match – State Tax Delinquencies. A House Judiciary Subcommittee held a hearing on and reported HB 452 by Rep. Steven Sainz (R-Woodbine) allows the Department of Revenue access to the child support data match registry to search, levy and seize deposits found of delinquent tax payers. The Judiciary Committee passed the bill Friday. GBA is monitoring.
Stored Value Cards. HB 488 by Rep. Martin Momtahan (R-Dallas) establishes a process intended to prevent the use of stored value cards to commit organized retail crime. The bill was assigned to the House Special Judiciary Committee. GBA is monitoring.
Homeowner/Property Owner Association Statement of Accounts. The Senate Special Judiciary Committee held a hearing on and reported SB 178 by Rep. P.K. Martin, IV (R-Lawrenceville). The bill establishes a statutory statement of accounts to be used by authorized parties representing homeowner or property owner associations to respond to requests for information needed by mortgage lenders to consider a loan request, including outstanding fees owed by property owners.

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:

Title Insurance. SB 202 by Sen. William Ligon (R-Brunswick) would allow title insurance to be procured on a lender's security interest in personal property taken by the lender as collateral for a loan. The bill has been assigned to the Senate Insurance and Labor Committee. GBA is monitoring.

Timber Tax Credits. HB 446 by Rep. David Knight (R-Griffin) relating to income tax credits for timber producers incurring losses from Hurricane Michael, so as to clarify that certain income tax credits that have been transferred shall not be refundable to the transferee and shall not be eligible for transfer. The bill has been assigned to the House Ways and Means Committee. GBA is monitoring.

Self-settled Spendthrift Trust. SB 186 by Sen. Bill Cowsert (R-Athens) creates a new trust in Georgia that allows the creator of the trust to also be the beneficiary of the trust. The bill has been assigned to the Senate Banking and Financial Institutions Committee. GBA is monitoring.

Wire Transfers. HB 532 by Rep. Jeff Jones (R-Brunswick) would require the collection of a defined fee to be remitted to the state for sending certain wire transfers. The bill was assigned to the House Judiciary Committee. GBA is monitoring.

Property Owner Associations Study Committee. HR 329 by Rep. William Boddie (D-East Point) would create a committee to study how various communities could be better organized to implement requirements and procedures for turnover and transition from declarants, developers, or other establishing entities to property owners comprising the community association. The bill was assigned to the House Special Rules Committee. GBA is monitoring.

Property – Dispossessory Proceedings. HB 492 by Rep. Bonnie Rich (R-Suwanee) would require execution of a writ of possession be made within 30 days of the issuance of the writ unless good cause is shown. The Bill passed the House Judiciary Committee Friday. GBA is 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..

March 1, 2019