STATE GOVERNMENT RELATIONS
Governor Signs Two Major Bills Into Law
Yesterday Gov. Eric Holcomb signed into law two major pieces of legislation, reflecting an unusually fast pace this early in session. Both are of strong interest to the banking industry.
HEA 1056: A fix to 2020 SEA 340. This bill was a key priority to the IBA for the 2021 session. The legislation “fixes” or undoes the second-witness requirement to record instruments that arose from the interpretation of language change from “or” to “and” in SEA 340 from the 2020 session. SEA 340 had created significant disruption in the real estate marketplace because of issues with interpretation.
HEA 1056 also retroactively applies the language to all instruments recorded after July 1, 2020. Notably, this legislation was drafted as an emergency declaration, paving the way for the bill to become Indiana law immediately upon receipt of the governor’s signature, rather than waiting for the standard July 1 enactment date that most bills adhere to once signed into law.
SEA 1: COVID-19 liability legislation. This broadly applied immunity bill for COVID-19 liability was supported by the IBA, as well as other business trades and individual entities. The legislation provides protection against COVID-19-related lawsuits in an effort to provide assurance for business owners and individuals “that they will not have to live and work in fear of frivolous lawsuits” due to the pandemic, as the governor stated.
Committee Work Comes to a Close for the First Half of Session
Committee work officially concluded the first half of the 2021 legislative session this week. If an introduced bill did not pass its committee of origin this week, it is not eligible for consideration the rest of session. The conclusion of committees sets up the work for next week, when the House and Senate will have to pass bills on second and third reading before the legislature breaks prior to the second half of session.
As the first half of session nears an end, the IBA Government Relations Team continues to voice industry perspective on many critical bills. Following are some of those bills.
House Bill 1095 - Trespassing and Aggressive Harassment
Author: Rep. Justin Moed (D)
Summary of legislation: Provides that a person commits the offense of criminal trespass if: (1) the person, who does not have a contractual interest in the property, knowingly or intentionally enters or refuses to leave the property of another person after having been prohibited from entering or asked to leave the property by a law enforcement officer when the property is designated by a municipality or county enforcement authority to be an unsafe building or premises; or (2) the person knowingly or intentionally enters the property of another person after being denied entry by a court order that has been issued to the person or issued to the general public by conspicuous posting on or around the premises in areas where a person can observe the order when the property has been designated by a municipality or county enforcement authority to be an unsafe building or premises; unless the person has the written permission of the owner, the owner’s agent, an enforcement authority or a court to come onto the property for purposes of performing maintenance, repair or demolition. Provides that an individual who harasses another person with the intent to obtain property from the other person commits aggressive harassment, a Class C misdemeanor. Defines “harasses.” Repeals the chapter concerning panhandling.
House Bill 1114 - Residential Building Design Elements
Author: Rep. Doug Miller (R)
Summary of legislation: Prohibits a municipality from regulating design elements of residential structures. Specifies certain exclusions from this prohibition. Provides that any rule, ordinance or other regulation that conflicts with the prohibition is void. Provides that a person aggrieved by a violation of the bill’s provisions may file, in a court having jurisdiction, a petition to obtain an injunction against the violation.
House Bill 1260 - Gift Certificates and Store Gift Cards
Author: Rep. Tony Cook (R)
Summary of legislation: Provides that a person shall not sell or issue to an Indiana consumer any gift certificate or store gift card with an expiration date unless certain conditions are met. Provides that, with respect to a gift certificate or store gift card that is sold or issued to an Indiana consumer after Dec. 31, 2022, if at any time after the gift certificate or store gift card is issued or sold: (1) the merchant for which the gift certificate or store gift card was originally sold or issued: (A) for any reason ceases to do business in Indiana; or (B) for any reason: (i) substantially changes; or (ii) ceases to offer; the types of goods or services that were offered to consumers at the time the gift certificate or store gift card was originally sold or issued; and (2) any expiration date: (A) authorized under the bill’s provisions; and (B) applicable to the gift certificate or store gift card (or to the underlying funds associated with either) has not elapsed; the merchant for which the gift certificate or store gift card was originally sold or issued shall, upon the request of an Indiana consumer who is the rightful holder of the gift certificate or store gift card, promptly refund to the holder the balance of the underlying funds or provide the holder with the remaining balance in some other manner. Provides that a person that violates the bill’s provisions: (1) commits a deceptive act that is actionable by an aggrieved consumer and the attorney general under the Deceptive Consumer Sales Act; and (2) is subject to the penalties and remedies set forth in the Deceptive Consumer Sales Act. Authorizes the attorney general to adopt rules to implement these provisions.
House Bill 1328 - Subdividing Land
Author: Rep. Jeff Ellington (R)
Summary of legislation: Requires a unit to allow a property owner to subdivide the owner’s property by deed if: (1) the owner requests a subdivision exemption; and (2) certain requirements are met. Requires the property owner to file an application with the plan commission accompanied by a plat drawing, the recorded deed of the parent parcel and any application fee. Provides that the application must be reviewed and approved by the plan commission staff or the plan director, without a public hearing or the approval of the plan commission. Provides that approval of the application does not exempt the property owner from complying with any other requirements regarding construction of a new residential home, including obtaining a building permit. Provides that if the number of lots that are created by the subdivision make the provisions of the subdivision ordinance applicable, the property owner must comply with the ordinance, except for any provisions controlling lot size.
House Bill 1498 - Publication of Local Government Notices
Author: Rep. Doug Miller (R)
Summary of legislation: Allows a political subdivision to publish legal notices on a legal notice website instead of in a newspaper. Establishes requirements regarding availability and accessibility of a legal notice website. Requires a political subdivision to designate an official responsible for the electronic publication of legal notices, if the political subdivision publishes legal notices electronically. Provides that if a political subdivision does not have an official website, legal notices may be published on an official website of the county government. Establishes requirements for the duration of the posting of a legal notice and proof of posting. Provides that a towing service acting as an agent of a government agency that provides the notice required to dispose of abandoned vehicles or parts is subject to the same public notice advertising rates as a governmental agency.
Senate Bill 28 - Tax Sales
Author: Sen. Rick Niemeyer (R)
Summary of legislation: Prohibits a person who is delinquent in the payment of personal property taxes or is subject to an existing personal property tax judgment from bidding on or purchasing a tract at a tax sale. Prohibits a business entity from bidding on or purchasing a tract at a tax sale when a person who is prohibited from bidding on or purchasing a tract at a tax sale: (1) formed the business entity; (2) joined with another person or party to form the business entity; (3) joined the business entity as a proprietor, incorporator, partner, shareholder, director, employee or member; (4) becomes an agent, employee or board member of the business entity; or (5) represents the business entity in a legal matter. Requires a county treasurer to pay all taxes and assessments that accrue on the tract of real estate through the time the record owner is divested of title from the tax sale surplus fund for the tract. Permits a county legislative body to adopt an ordinance prohibiting the assignment of a certificate of sale prior to the issuance of a tax title deed. Adds requirements that must be met within 150 days of the date a court grants a petition to issue a tax deed before a county auditor can issue or record a tax deed. Provides that a person who provides false information on the county treasurer's tax sale affidavit commits a Class A misdemeanor.
Senate Bill 188 - Revised Uniform Unclaimed Property Act
Author: Sen. Eric Koch (R)
Summary of legislation: Repeals the unclaimed property act and replaces it with the revised unclaimed property act. Makes conforming amendments.
Save the Date - Legislative Briefing - March 5
Join us for the virtual 2021 IBA Legislative Briefing, scheduled for March 5. We have transitioned our annual grassroots advocacy event to the safety of a virtual format, providing an opportunity for members to engage with Indiana lawmakers and discuss legislative issues important to the banking industry. Learn more and register here.
Save the Date - FLD Day at the Statehouse - April 9
The virtual IBA Future Leadership Division Day at the Statehouse is scheduled for April 9. This is an opportunity for emerging bank leaders to network with peers and learn more about grassroots advocacy and the legislative process. Details and registration are forthcoming.
FEDERAL GOVERNMENT RELATIONS
SBA Issues New Information Notice on SAM.gov Registration
The Small Business Administration has released Information Notice 5000-20094. The notice addresses the requirement of all 7(a) Lenders, including Paycheck Protection Program lenders and others, to register in the System for Awards Management (SAM or SAM.gov) and receive a unique entity identifier.
New SBA Procedural Notice
The Small Business Administration has released Procedural Notice 5000-20093 - Guidance on Establishing Maturities of New 7(a) Loans Eligible to Receive Payments under Section 1112 of the CARES Act on or after Feb. 1, 2021.
New SBA Procedural Notice 5000-20095
The Small Business Administration has issued a new procedural notice that adjusts the number of months of 7(a), 504 and Microloan payments it is making for borrowers under Section 1112 of the CARES Act, as amended by Section 325 of the Economic Aid Act. The notice states that “SBA has determined that the $3.5 billion that was appropriated to carry out Section 325 of the Economic Aid Act is insufficient to make the payments for the periods authorized by Section 1112(c)(1) of the CARES Act, as amended by Section 325 of the Economic Aid Act.” The notice provides a plan to reduce the number of months provided for each loan category, and it is effectively immediately.
ABA, ICBA and CUNA Urge OCC to Reconsider Expanded Trust Charter Eligibility
The American Bankers Association, Independent Community Bankers of America and Credit Union National Association cosigned a letter on Feb. 11 to Acting Comptroller of the Currency Blake Paulson to withdraw an interpretive letter and the conditional approval for two recent trust charters, in accordance with a Jan. 20 White House memo calling for a regulatory freeze.
The interpretive letter expanded the scope of entities eligible to apply for a national trust charter, effectively eliminating a longstanding requirement that applicants for a national bank trust charter engage in fiduciary activities. Shortly after, the Office of the Comptroller of the Currency conditionally approved a charter for Anchorage Digital Bank and Protego Trust Bank – neither of which would have been eligible for such a charter without the interpretive letter.
The groups raised concerns that these significant changes to the charter eligibility requirements did not go through the conventional rulemaking process, including a public notice and comment period. “The OCC made significant policy changes regarding the eligibility requirements to receive a trust charter through an interpretative letter without public input during the final days of the previous administration,” the groups wrote. “That change has already, and will continue to facilitate, charter approvals that we believe are ill-considered.”
Financial Services Groups Urge OCC to Withdraw CRA Information Collection Survey
In related news, the American Bankers Association, Independent Community Bankers of America and seven other financial trade groups echoed the call for interagency coordination on CRA reform in a Feb. 16 letter to the Office of the Comptroller of the Currency. In the letter, the groups raised concerns about the OCC’s CRA information collection survey, which will gather bank-specific information from institutions subject to the general performance standards established in the agency’s 2020 CRA rule.
The groups urged the OCC to publicly announce that it will coordinate with the Federal Reserve and the Federal Deposit Insurance Corp. on a joint CRA rulemaking. In support of this joint rulemaking, the groups wrote, the OCC should delay the compliance date of the 2020 CRA rule for at least two years, formally withdraw the information collection in the spirit of the Biden administration’s Jan. 20 regulatory freeze memo, and discontinue work to establish performance benchmarks for the 2020 rule. The ABA and ICBA made similar recommendations in a Feb. 11 letter to the OCC.
“We strongly support modernizing the regulations that implement the Community Reinvestment Act and reiterate our commitment to engaging in a constructive dialogue with the banking agencies and other CRA stakeholders in order to develop an updated regulatory framework that serves communities, banks, and regulators well,” the groups wrote. “However, proceeding with the proposed information collection would be counterproductive and would not advance an interagency effort.”
Biden Administration Extends Foreclosure Moratorium, Mortgage Forbearance
President Biden on Tuesday announced an extension of certain foreclosure moratoriums and mortgage forbearance programs that were set to expire in March. The announcement applies to loans guaranteed by the Department of Veterans Affairs or Department of Agriculture, and those insured by the Department of Housing and Urban Development.
The foreclosure moratorium for those homeowners will now be extended through June 30, 2021. Those agencies also extended the date by which borrowers must request COVID-19 forbearance to June 30, 2021. Finally, borrowers who entered forbearance before June 30, 2020, can now request two additional forbearance extensions in three-month increments.
The announcement by President Biden was done in conjunction with formal announcements by the Department of Housing and Urban Development, Department of Veterans Affairs and Department of Agriculture in a coordinated effort to extend and expand upon existing forbearance and foreclosure relief programs. The extensions follow an announcement made last week by the Federal Housing Finance Agency that Fannie Mae and Freddie Mac would extend forbearance by three months for borrowers coming to the end of their forbearance periods and extend the moratorium on foreclosures for Fannie Mae and Freddie Mac loans to March 31, 2021.
IBA COVID-19 Updates
The IBA has several COVID-19 resources and updates available at our website.