FEBRUARY 6, 2015
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Auto TNC Bill Sought by Credit Unions Introduced (Issue 1 of 6)
State Rep. Rich Golick introduced legislation to address potential insurance problems caused by the commercial use of privately owned cars by drivers for companies such as Uber and Lyft.

  Legislative Changes for Credit Unions in DBF
Housekeeping Bill (Issue 2 of 6)

A Georgia Department of Banking and Finance housekeeping bill introduced this week includes several provisions relevant to credit unions, including a measure that would give state-chartered CUs more parity with those federally chartered.

  State Session: High Level of Activity with 29 More Days to Go! (Issue 3 of 6)
The state Legislature met for only three days this week, but the large volume of legislation introduced requires vigilant monitoring to ensure that the interests of credit unions are protected.

  Congress Continues to Address Data Breaches (Issue 4 of 6)
A Senate subcommittee hearing this week addressed the continuing problem of data breaches. The hearing included testimony on efforts in crafting a federal data-breach bill.

  Credit Unions Host State Legislature (Issue 5 of 6)
Georgia credit union leaders shared industry insights with members of the state Legislature at a February 3 reception. The event was an opportunity to build relationships and to thank legislators for their efforts on behalf of the industry.

  Risk-Based Capital Proposal Version II: Where Does Your Credit Union Stand? (Issue 6 of 6)
The Credit Union National Association (CUNA) has added to its website a Risk-Based Capital Action Center that lets credit unions assess the potential impact of NCUA's revised risk-based capital proposal.

Rush hourTNC Bill Sought by Credit Unions
Introduced (Issue 1 of 6)

On February 3rd HB 190 by Rep. Rich Golick (R-Smyrna) was introduced to help address an issue on behalf of credit unions, the insurance industry and others. This is the TNC (Transportation Network Company) insurance coverage legislation that has been actively sought by GCUA to protect consumers and their collateral. This bill was introduced after months of meetings and dialogue between GCUA and insurance industry lobbyists, as well as the TNC lobbyists who oppose this effort to eliminate the gaps in insurance. Rep. Golick and House Insurance Chairman Rep. Richard Smith (R-Columbus) in particular have been strongly supportive of this legislation on behalf of credit unions.

This bill is being lobbied to protect both the Georgia credit unions and their members. TNCs such as Uber, Lyft and other ride-share companies have grown in popularity around the world - and it is no secret that credit unions help members with auto loans. But there is little public awareness that there is a gap in insurance coverage if individuals are operating their vehicles as ride-share cars (as this is a commercial activity). Much work is needed to continue to move the bill forward as TNC companies have significant grassroots influence and a tough fight is anticipated. This issue is of interest to credit unions from a consumer perspective, as well as from a lender’s perspective in protecting the collateral. Stay tuned!

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Legislative Changes for Credit Unions in DBF Housekeeping Bill (Issue 2 of 6)

Georgia Capitol interiorAlso on February 3rd, the Department of Banking and Finance’s Housekeeping Bill HB 184 by Rep. Bruce Williamson (R-Monroe) was introduced. This legislation contains several “clean up” edits, such as removing the filing-in-triplicate requirements peppered throughout the financial law code of Title 7. While this legislation covers changes to the broad spectrum of industries that fall under the supervision of the Department, some of the changes this bill seeks that are of interest to credit unions include:

  • Provide state-chartered financial institutions stronger parity with federally chartered institutions (which is beneficial when there are issues on the state level that negatively impact credit unions),
  • Outline in law how a bank could convert to a credit union,
  • Require out-of-state credit unions operating in Georgia to have federal insurance,
  • Provide the Department the option to conserve a troubled credit union (as opposed to taking a stronger measure) to give another avenue to return a credit union to a positive status,
  • Require that the comprehensive audit of a credit union be done by a licensed, independent public accountant or firm (unless the credit union is less than $15 million in assets, in which case an independent accountant or firm or internal auditors are permitted),
  • Set a minimum standard of conduct of directors by outlining impermissible actions (such as conflict of interest in voting on purchases/sales where they personally benefit, i.e., receiving an “insider” deal), and
  • Provide credit unions the ability to pay the required amount to join the actual credit union on the members' behalf if they so choose.

For some in the credit union industry, this bill is "old news" as those attending the Grassroots Academy last week had an advance preview of the legislation and were able to discuss the provisions with Department of Banking and Finance Commmisioner Kevin Hagler. GCUA has worked closely with the Department on the provisions to protect and advance credit unions, and will help navigate this bill through the legislative process.

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Georgia CapitolState Session: High Level of Activity
with 29 More Days to Go! (Issue 3 of 6)

This week the state Legislature met for three days, bringing them to 11 days of their 40-day schedule. And while they are taking a somewhat slower pace with the schedule, the level of activity outweighs the actual "day count" as the legislators have introduced a high volume of bills. This constant stream of bills introduced requires constant monitoring on behalf of credit unions, and there will be many more issues, with GCUA actively working to shape several pending bills before they are drafted as legislation.

Hearings of interest to credit unions this week included:

  • A House Judiciary subcommittee debated HB 153 by Rep. Tom Weldon (R-Ringgold) on Wednesday, February 4th. In discussions with legislators and lobbyists, the intent behind the bill is to enforce current Georgia law and prevent non-attorneys from closing real estate loans. However, the way the bill is presently worded, it would provide a civil remedy against those in violation by the law by the "unlicensed practice of law" - greatly broadening the scope of the bill. This bill will be debated again in another hearing, and is being monitored to ensure that credit unions are not inadvertently swept into legal action for normal day-to-day operations.
  • The Senate Banking and Finance Committee met on Tuesday, February 3rd to set the rules for the committee, as the chairman and many of the members are new to their posts.
  • On Monday, February 2nd a House Judiciary subcommittee debated HB 51 by Rep. Tommie Benton (R-Jefferson), which seeks to prevent individuals from being forced to pay homeowner association fees if purchasing a tax lien on a property. This bill will be readdressed in an upcoming hearing, and is being monitored closely as the intent of the bill can greatly change in the process and become a vehicle for homeowner associations’ superseding lien language to try to require foreclosing parties to pay past due fees.

This week also saw many issues introduced that will need to be monitored through the process:

  • Foreclosures: Rep. LaDawn Jones (D-Atlanta) introduced HB 173 which seeks to add additional required language on foreclosure notices.
  • Motor Vehicle Lending: HB 156 and HB 158 by Rep. Tom Rice (R-Norcross) seeks to change the method by which motor vehicles are valued for taxation - something of interest to credit unions in determining used auto values in lending. Rep. Rice also introduced HB 205, which addresses DUIs and ignition cutoff devices. This issue is monitored to ensure that second chance auto lending programs are not swept into any regulations surrounding the devices.
  • Hiring Practices: HB 163 by Rep. Winfred Dukes (D-Albany) would prevent employers from obtaining credit checks on employees.
  • Bankruptcy: SB 65 by Sen. Jesse Stone (R-Waynesboro) seeks to increase the bankruptcy exemption for debtor’s aggregate interest from $600/$5,000 to $1,200/$10,000. 

In addition, there have been several bills introduced that seek to study tax exemptions, new and existing. Stay tuned; for more details you can also follow the activity at the statehouse on Twitter, and access the bills monitored on behalf of credit unions here.

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U.S. CapitolCongress Continues
to Address Data Breaches
(Issue 4 of 6)

Congress continues to keep data breaches at the forefront of committee activity, with the Senate subcommittee on consumer protection, product safety, insurance and data security’s February 5th hearing, titled "Getting it Right on Data Breach and Notification Legislation in the 114th Congress." The hearing featured testimony on efforts in crafting a federal data-breach bill, with a focus on issues including the consumer benefits of a uniform federal law in place of disparate state laws, the timeliness of notification to consumers and the definition of sensitive personally identifiable information. 

The House subcommittee on commerce, manufacturing and trade held a similar hearing last week. CUNA signed a letter with several other trade organizations that was submitted into the record for that hearing, and credit unions continue to push for national protection and notification standards that preempt state laws and recognition of the requirements financial institutions face under the Gramm-Leach-Bliley Act.

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From left: Andrea Shorr, LGE Community CU; Rep. Richard Smith; Janet Davis, Kinetic CU; Sherry Saxon, Augusta Metro FCU
Credit Unions Host State Legislature (Issue 5 of 6)

On Tuesday, February 3rd credit union leaders spent time sharing their insight and thanks with members of the state Legislature, growing influence for the industry at a reception held in conjunction with the February League and GCUS Board Meetings, as well as the Advocacy Policy Committee and GA CUPAC Trustees meeting. This was our largest group of legislators to date, with many members of the House and Senate leadership teams in attendance, along with Attorney General Sam Olens, Department of Labor Commissioner Mark Butler and many senators and representatives from around the state. Several legislators remarked privately that the credit union event was extremely well attended - something that is reflective of the positive impact credit unions have in their districts!

This evening was an ideal opportunity to build relationships with legislators, communicate how credit unions help consumers afford life, and speak one-on-one with them on the above state issues of importance to our industry. Our thanks to the credit union board and committee members in attendance; you made a significant positive impact on the level of influence.

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QuestionsRisk-Based Capital Proposal Version II:
Where Does Your Credit Union Stand? (Issue 6 of 6)

Curious about how NCUA's revised risk-based capital proposal (RBC2) impacts your credit union? CUNA's Risk-Based Capital Action Center now includes a list of credit unions with RBC ratio estimates and a calculator tool. The calculator begins with data imported from a credit union's September 2014 call report, and then allows the credit union to redistribute assets into the new categories in RBC2, generating an accurate RBC ratio. Included is a list of estimates for all credit unions sorted alphabetically by state. Each credit union has its capital classification under the current prompt corrective action system, the original risk-based capital proposal from last year and RBC2. The data used is current as of September 2014.

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