NWCUA Sponsored Legislation Moves Forward in Washington

Washington legislators burned the midnight oil last week, passing bills in advance of the March 11 “house of origin” cutoff. 

House Bill 1871 and Senate Bill 5757, legislation sponsored by the Northwest Credit Union Association, passed out their respective house of origin during this busy week. The legislation addresses credit unions’ corporate governance. HB1871 passed the House on March 2 by a vote of 97-0 with 1 excused, while SB5757 passed the Senate on March 4 by a vote of 43-3 with 3 absent. SB 5757 was then referred to the House Business & Financial Services Committee where it is scheduled for a hearing on March 13.

Last week started with an important ruling by Lieutenant Governor Brad Owen, President of the Senate. On Monday, he found that the majority Republican’s rule which required a two-thirds supermajority vote in the Senate to approve new taxes, was unconstitutional. Owen based his ruling in part on a Supreme Court decision in 2013 that overturned the two-thirds approval requirement by voters. The Senate’s Majority Coalition Caucus comprised of all 25 Republicans and 1 Democrat (Sen. Tim Sheldon) had adopted the rule on the first day of session as a way to block two proposals from Governor Jay Inslee — a capital gains tax and a pollution tax for greenhouse gas emissions.

Transportation

At the start of session the only agreement on a transportation package was that it would need to start in the Senate where Republicans were saying a gas tax increase would be on the table as long as reforms were. On Monday, that is just what happened. The Senate first passed Senate Bill 5987, a $15 billion transportation finance bill by a vote of 27-22 and then passed Senate Bill 5988, the transportation investment plan by a vote of 41-8. In addition, several bills on transportation reforms were passed to bring more accountability to the Department of Transportation, maximize future gas-tax dollars and to prioritize congestion relief. The bills now await action by the House.

Payday Lending

Despite strong opposition from a number of consumer groups as well as opposition by the Washington State Attorney General, two bills related to installment loans continue to advance. House Bill 1922 and its companion measure Senate Bill 5899 address small loans and small consumer installment loans. The bills:

  • Create a new small consumer installment loan regulated by DFI.
  • Permit a loan of up to $1,000 for a minimum of six months and a maximum of 12 months.
  • Allow an origination fee of 15 percent of the loaned amount, amortized over the life of the loan.
  • Allow an interest rate of 36 percent per annum.
  • Allow a maintenance fee of 7.5 percent of the total loaned amount per month with a maximum fee of $60 a month.
  • Provide for a repayment plan prior to any civil action upon a loan in default.
  • Make military borrowers ineligible for a small consumer installment loan.
  • Create prohibited practices for licensees.
  • Exempt the late fee and monthly maintenance fees from annual adjustment for inflation.

Payday Lenders have lost about 75 percent of their business since legislation restricting their loans went into effect in 2009. DFI figures indicate total payday loans have gone from more than $1.3 billion in 2009 down to $331 million in 2013. The number of stores has also shrunk from 494 to 174 over that period. Supporters of the bill say the 2009 legislation went too far and some people are either being cut off from accessing emergency funds or being pushed towards illegal online lenders. Washington’s current law limits payday loans to $700 per loan and limits borrowers to a maximum eight loans a year. 

Minimum Wage

House Bill 1355 and its companion measure, Senate Bill 5285 would increase the state minimum hourly wage to $12 over the course of four years. HB1355 passed the House on March 3 by a vote of 51-46 with 1 excused and was then referred to the Senate Commerce & Labor Committee. SB 5285 which was referred to the Senate Commerce & Labor Committee at the beginning of session never received a hearing.

Sick & Safe Leave 

House Bill 1356 and its companion measure Senate Bill 5306 would require employers with more than 4 FTEs to provide paid leave to employees for: (1) medical reasons relating to the employee’s or a family member’s health; (2) reasons permitted under existing law for purposes related to domestic violence, sexual assault, and stalking; or (3) closure of the employee’s place of business or child’s school or place of care due to specified public health emergencies. HB1356 passed the House on March 3 by a vote of 51-46 with 1 excused and was then referred to the Senate Commerce & Labor Committee. SB 5306 which was referred to the Senate Commerce & Labor Committee at the beginning of session, never received a hearing.

Operating Budget

This year, it is the House Democrats’ turn to produce the first operating budget proposal, and they have set a deadline of March 23.

Other bills NWCUA is tracking include:

Data Breach 

Substitute House Bill 1078 and its companion measure, Senate Bill 5047, are AG request bills to modify notice requirements in cases of a data breach. Substitute HB1078 passed the House on March 4 by a vote of 97-0 with 1 excused and was then referred to the Senate Law & Justice Committee. SB 5047 which was referred to the Senate Law & Justice Committee at the beginning of the session, never received a hearing.

Financial Fraud

House Bill 1090 reauthorizes and expands the Financial Fraud and Identity Theft Crimes Investigation and Prosecution Program. The bill passed the House on March 4 by a vote of 97-0 with 1 excused and was then referred to the Senate Law & Justice Committee.

Financial Literacy

Substitute House Bill 1121 changes the composition and duties of the Financial Education Public-Private Partnership (FEPPP). The bill passed the House on March 2 by a vote of 92-5 with 1 excused and was then referred to the Senate Early Learning & K-12 Education Committee.

Substitute Senate Bill 5202 also changes the composition and duties of the FEPPP. The bill passed the Senate on March 2 by a vote of 44-4 with 1 excused. The bill was then referred to the House Education Committee where it is scheduled for a hearing on March 12.

Look for the Washington Legislative Week in Review each week in Anthem during legislative session which runs January 29 – April 26, 2015. If you have questions or comments, please contact Mark Minickiello, mminickiello@nwcua.org, 206.340.4812.

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