STATE GOVERNMENT RELATIONS
Lawmakers Back in Session After Pause
The Indiana General Assembly was back to work after proactively halting all work last week due anticipated protests at state capitols around the country. All committee work originally scheduled for last week was pushed into this week. Lawmakers now have just under three weeks to hold initial hearings and move bills out of committee.
All the bill lists have been released, bringing a total of bills filed this year to 1,025. This number is less than in previous long sessions. The IBA Government Relation Teams continues to monitor and engage on legislation as it appears in committees. The following are a few bills that are of particular importance to IBA members.
Senate Bill 370 – Limitations on Actions Concerning Deposit Accounts
Author: Sen. Andy Zay (R)
Summary of legislation: The bill amends the statute concerning the statute of limitations for actions upon promissory notes, bills of exchange or other written contracts for the payment of money to: (1) include actions upon deposit accounts; and (2) provide that an action against a financial institution with respect to any of these that are executed after Aug. 31, 1982, must be commenced within two years after the cause of action accrues.
House Bill 1079 - Practice of Dentistry; Virtual Claim Payments
Author: Rep. Dennis Zent (R)
Summary of legislation: Immunizations – The bill provides that a dentist may administer an immunization if the dentist: (1) is certified in cardiopulmonary resuscitation; (2) has successfully completed a course of training in immunization that meets specified requirements; and (3) administers the immunization in accordance with a protocol that includes specified requirements and procedures. The bill prescribes reporting requirements for a dentist who administers an immunization. It provides that a dentist: (1) is not required to administer immunizations; and (2) is not required to complete immunization training if the dentist chooses not to administer immunizations.
Health Plans – The bill provides that a health insurance plan, including a health management organization contract, may not require a dental provider to accept payment under the health insurance plan by virtual claim payment. The bill requires a health insurer, including a health maintenance organization, to do the following before providing payment to a dental provider by electronic funds transfer, including by virtual claim payment: (1) notify the dental provider of any fees associated with the electronic funds transfer; (2) advise the dental provider of the methods of payment available under the health insurance plan and provide clear instructions to the dental provider as to how to select an alternate payment method; and (3) notify the dental provider as to whether the health insurer is receiving a portion of the fee charged for the electronic funds transfer.
House Bill 1493 – Payment Card Network Interchange Fees
Author: Rep. Steve Bartels (R)
Summary of legislation: This bill provides that the amount of certain taxes (covered taxes) that are: (1) calculated as a percentage of the gross retail income received by a merchant or seller in an electronic payment transaction; and (2) listed separately on the payment invoice or other demand for payment; must be excluded from the amount upon which any interchange fee is charged by a payment card network for the electronic payment transaction. The bill defines “interchange fee” as a fee established, charged or received by a payment card network to compensate an issuer of a debit card or credit card for the issuer’s involvement in an electronic payment transaction. The bill requires a payment card network to do one of the following: (1) at the time of settlement of an electronic payment transaction, deduct from the calculation of any interchange fees the amount of any covered taxes that are specific to that form or type of electronic payment transaction; (2) rebate an amount of the interchange fee in an amount proportionate to the amount of the interchange fee attributable to all covered taxes imposed in the electronic payment transaction. The bill provides that the required deduction or rebate must occur at the time of settlement when the merchant or seller, as part of the transaction finalization, is able to capture and transmit tax and fee amounts relevant to the sale at the time of sale. It provides an exception allowing a payment card network to credit a merchant’s or seller’s settlement account for interchange fees collected on amounts that included covered taxes, in cases in which a merchant or seller is not able to capture and transmit tax or fee amounts relevant to the sale at the time of sale. This bill provides that a payment card network that violates these provisions: (1) is liable for a civil penalty in an amount not to exceed $1,000 per violation, payable to a person aggrieved by the violation; and (2) shall refund to each affected merchant or seller the amount of excess interchange fees collected.
Senate Bill 1 / House Bill 1002 – Immunity Related to COVID-19
Author: Sen. Mark Messmer (R) and Rep. Jerry Torr (R)
Summary of Senate legislation: Professional Discipline – This bill protects health care providers from professional discipline for certain acts or omissions arising from a disaster emergency unless the act or omission constitutes gross negligence, willful or wanton misconduct, or intentional misrepresentation. The bill also provides that a health care provider is not protected from professional discipline for actions that are outside the skills, education and training of the health care provider, unless certain circumstances apply.
Emergency Orders – The bill specifies that orders and recommendations issued by local, state and federal government agencies and officials during a state disaster emergency do not create new causes of action or new legal duties. The bill also specifies that the orders and recommendations are presumed irrelevant to the issue of the existence of a duty or breach of a duty. It specifies that the orders and recommendations are inadmissible at trial to establish that a new cause of action has been created or proof of a duty or a breach of a duty.
Civil Immunity – The bill prohibits filing a class action lawsuit against a defendant in a civil action allowed by the statute. The bill specifies that a governmental entity or employee is not liable if a loss results from an act or omission arising from COVID-19 unless the act or omission constitutes gross negligence, willful or wanton misconduct, or intentional misrepresentation. The bill provides that a person is not liable to a claimant for loss, damage, injury or death arising from COVID-19 unless the claimant proves by clear and convincing evidence that the person caused the loss, damage, injury or death by an act or omission constituting gross negligence, willful or wanton misconduct, or intentional misrepresentation. It provides immunity from civil liability to certain persons, entities and facilities providing health care and other services for certain acts or omissions related to the provision of health care services and other services during a state disaster emergency.
Summary of House legislation: Professional Discipline – This bill protects health care providers from professional discipline for certain acts or omissions arising from a disaster emergency unless the act or omission constitutes gross negligence, willful or wanton misconduct, or intentional misrepresentation. The bill also provides that a health care provider is not protected from professional discipline for actions that are outside the skills, education and training of the health care provider, unless certain circumstances apply.
Emergency Orders – The bill specifies that orders and recommendations issued by local, state and federal government agencies and officials during a state disaster emergency do not create new causes of action or new legal duties. The bill also specifies that the orders and recommendations are presumed irrelevant to the issue of the existence of a duty or breach of a duty. It specifies that the orders and recommendations are inadmissible at trial to establish that a new cause of action has been created or proof of a duty or a breach of a duty.
Civil Immunity – The bill prohibits filing a class action lawsuit against a defendant in a civil action allowed by the statute. The bill specifies that a governmental entity or employee is not liable if a loss results from an act or omission arising from COVID-19 unless the act or omission constitutes gross negligence, willful or wanton misconduct, or intentional misrepresentation. The bill provides that a person is not liable to a claimant for loss, damage, injury or death arising from COVID-19 unless the claimant proves by clear and convincing evidence that the person caused the loss, damage, injury or death by an act or omission constituting gross negligence, willful or wanton misconduct, or intentional misrepresentation. It provides immunity from civil liability to certain persons, entities and facilities providing health care and other services for certain acts or omissions related to the provision of health care services and other services during a state disaster emergency.
Senate Bill 400 - Statewide Electronic Lien and Title System
Author: Sen. Chris Garten (R)
Summary of legislation: This bill has the following provisions:
(1) Requires the Bureau of Motor Vehicles to implement a statewide electronic lien and title system (“system”) to process: (a) vehicle titles; (b) certificate of title data in which a lien is notated; and (c) the notification, maintenance and release of security interests in vehicles; through electronic means instead of paper documents.
(2) Provides that the BMV may: (a) contract with one or more qualified vendors to develop and implement a system; or (b) develop an interface to provide qualified electronic lien service providers secure access to data to facilitate the creation of a system.
(3) Sets forth certain requirements that apply if the BMV elects to implement the system through a qualified vendor versus through qualified electronic lien service providers.
(4) Specifies that a contract entered into between the BMV and: (a) a qualified vendor; or (b) a qualified electronic lien service provider; may not provide for any costs or charges payable by the BMV to the qualified vendor or the qualified electronic lien service provider.
(5) Sets forth dates by which the BMV must implement and allow or require the use of: (a) a statewide electronic lien system; and (b) a statewide electronic title system.
(6) Sets forth certain conditions that apply to the use of a statewide electronic lien system implemented by the BMV under these provisions.
(7) Authorizes the BMV to adopt rules, including emergency rules, to implement these provisions.
House Bill 1056 - Recording Requirements
Author: Rep. Jerry Torr (R)
Summary of legislation: This bill amends the requirements for instruments and conveyances to be recorded. The bill adds instances in which an instrument is considered validly recorded for purposes of providing constructive notice.
FEDERAL GOVERNMENT RELATIONS
SBA Issues Procedural Notice Addressing Second-Draw Loans
As the Small Business Administration works to resolve several issues with the Paycheck Protection Program flagged earlier this week, it issued a procedural notice late Wednesday night outlining how it will move forward with the processing of second-draw PPP loan applications for borrowers who still have unresolved issues related to their first-draw loans.
SBA indicated that beginning Wednesday, its platform began processing new second-draw loan applications for unresolved borrowers. These applications will be automatically moved to a “research” status and will require additional documentation. “It is imperative that lenders respond timely, as SBA will need time to review the documentation to determine whether the unresolved issue(s) can be cleared,” the SBA reported. “Lenders should work with their borrowers to assess the situation.”
Once SBA deems the issue resolved, applications will be automatically moved to the next stage of process and will not need to be re-submitted by the lender. However, SBA noted that “lenders that submitted a Second Draw PPP Loan guarantee application before January 27, 2021, that was rejected due to an unresolved issue with the first draw PPP Loan, should resubmit these applications.”
SBA also issued procedural notices related to various provisions of the most recent COVID-19 relief law. The notices address modifications of SBA’s 7(a) program, the elimination of certain 504 program fees, and a notice to lenders that SBA has informed eligible borrowers of assistance available under section 112 of the CARES Act.
Read the PPP procedural notice
Read the borrower assistance notice
CFPB Recognizes Pandemic Accommodations by Financial Institutions
Banks made accommodations to help consumers address pandemic-related hardships beyond what was legally required under the CARES Act, the Consumer Financial Protection Bureau observed in its latest “Supervisory Highlights” report. The report focuses on findings from the bureau’s prioritized assessment work that took place in response to the COVID-19 pandemic.
The bureau reported that some institutions offered expanded payment assistance programs and fee waivers due to the pandemic and many credit card issuers offered deferrals, while auto servicers provided six-month payment deferrals to any consumer with a COVID-19 hardship. Given the rapidly evolving nature of the pandemic, many institutions created COVID-19 response teams to identify and address consumer and industry challenges caused by the pandemic, and the CFPB noted that many were active in monitoring key processes and were able to self-identify issues and implement corrective actions.
Other pandemic response efforts observed by the bureau included providing consumer remediation, reversing fees, updating scripts to provide accurate information to consumers, transitioning from manual to automated processes, correcting inaccurate credit reporting and correcting account histories.
The report also offered specific observations related to mortgage servicing, auto and student loan servicing, credit card account management, consumer report-furnishing, debt collection, deposits, prepaid cards and small business lending.
House Financial Services Subcommittee Chairs, Democratic Members Announced
The House Financial Services Committee has announced the subcommittee chairs for the 117th Congress.
- Rep. Brad Sherman (D- Calif.) will be the new chairman of the investor protection, entrepreneurship and capital markets subcommittee.
- Rep. Earl Perlmutter (D-Colo.) will be the new chairman of the subcommittee on consumer protection and financial institutions subcommittee.
- Rep. Emmanuel Cleaver (D-Mo.) will be the new chairman of the subcommittee on housing, community development and insurance.
- Rep. Jim Himes (D-Conn.) will chair the subcommittee on national security, international development and monetary policy.
- Rep. Joyce Beatty (D-Ohio) will continue to chair the subcommittee on diversity and inclusion.
- Rep. Al Green (D-Texas) will continue to chair the oversight and investigations subcommittee.
House Financial Services Committee Chairwoman Maxine Waters (D-Calif.) also announced the full list of members who will serve on each subcommittee.
View the list of subcommittee members
Senate Confirms Yellen as Treasury Secretary
By a bipartisan vote of 84 to 15 Monday night, the Senate approved the nomination of Janet Yellen to serve as the next secretary of the Department of the Treasury. Yellen – who is only the second person to lead by the Federal Reserve and Treasury and the first woman to hold the top Treasury post – received unanimous approval by the Senate Finance Committee last week.
FHFA Raises Threshold for FHLB Community Bank Membership Status
The Federal Housing Finance Agency is raising the asset threshold used to determine whether a Federal Home Loan Bank member is considered a “community financial institution.” The new threshold – based on an inflation adjustment – is $1.239 billion and took effect Jan. 1. FHLB member banks under this threshold receive advantages in qualifying for bank membership, in the purposes for which they may receive long-term advances and in the collateral they pledge to secure advances.
IBA COVID-19 Updates
The IBA has several COVID-19 resources and updates available at our website.