Washington Legislative Week in Review

The 2016 regular session of the Washington State Legislature is in its second week. Even with education funding issues front and center, the credit union agenda is moving forward.

NWCUA Legislative Priorities for Washington State

Public Funds

Since the passage of legislation in 2012 which allowed credit unions to become public depositaries for amounts up to the maximum level of federal deposit insurance, the limit has become a great impediment to public entities choosing credit unions and in certain parts of the state, credit unions are the only financial institutions servicing their public neighbors. Your Association will continue to pursue passage of legislation allowing Washington credit unions to accept unlimited public funds deposits.

Advancing the Charter

Your Association will continue educating lawmakers about the importance of evolving the Washington Credit Union Act, allowing credit unions to operate in the most effective and efficient manner. This will include working to advance a bill to allow state charted credit unions to access supplemental capital.

Foreclosure

As foreclosure rates have now returned to pre-recession levels, your Association, along with financial institutions will engage the legislature to discuss the “right sizing” of the Foreclosure Fairness Act (FFA) which was created in 2011 to help homeowners and lenders explore possible alternatives to foreclosure and reach a resolution whenever possible.

Financial Fraud

Your Association will continue to educate lawmakers about the significant impacts of financial fraud on credit unions and support legislation making the unlawful possession of instruments of financial fraud a crime.

Financial Literacy

Washington credit unions support legislation which encourages consumer savings and thrift, promotes increased financial education among all age groups, and supports efforts to teach personal financial management skills that empower individuals to achieve success. As members of the Financial Education Public Private Partnership (FEPPP), your Association will continue to support legislation and identify strategies to increase the financial education of students.

Important Legislation Your NWCUA Team is Tracking

Tax Exemptions

Governor Jay Inslee has unveiled a budget proposal to increase the state’s minimum annual salary for rookie teachers from $35,700 to $40,000, plus give all teachers a 1 percent pay raise. This is expected to cost an extra $80 million in the 2016–2017 fiscal year, plus an extra $100 million each subsequent year. To pay for that, Inslee is proposing to close four tax preferences, one of which is the REET exemption on foreclosure sales which your Association is on record as opposing. Removal of the REET exemption would require REET to be paid twice; once at the foreclosure sale and then again upon resale of the property. 

DFI Agency Request Legislation

Mortgage Lending Fraud

House Bill 2315 and its companion measure Senate Bill 6282 address the expiration date of the Mortgage Lending Fraud Prosecution Account. In 2003 the legislature created the Mortgage Lending Fraud Prosecution Account to aid in the prosecution of consumer fraud in the mortgage lending process. The account is administered by DFI and funds are generated by a $1 surcharge assessed at the recording of a deed of trust.  DFI may use the account to reimburse county prosecutors and/or the Attorney General for costs related to the investigation and prosecution of mortgage fraud cases. The bills would delay the expiration date of the account and related surcharge until June 30, 2021.

Securities

House Bill 2316 and its companion measure Senate Bill 6283 address the Securities Act of Washington. The bills make technical changes to the Act, authorizes DFI to deny or revoke crowdfunding securities exemptions in certain circumstances, establishes renewal deadlines for broker-dealers, investment advisers, and other registrations, and extends the deadline to request a hearing on certain administrative actions against a broker-dealer, investment advisor, and other registrations.

Marijuana Banking

Senate Bill 6207 and its companion measure House Bill 2584 concern public disclosure of information submitted to the Liquor and Cannabis Board (LCB) regarding marijuana product traceability and operations. The LCB collects a variety of business records relating to marijuana businesses that produce, process, transport, or sell marijuana. Many of these businesses have raised safety concerns regarding public access, under the Public Records Act (PRA), to these sensitive records. The bills would add two exemptions to the PRA concerning the disclosure of certain marijuana business records:

1. Financial, commercial operations, and security-related information supplied to the LCB for the purpose of obtaining, maintaining, or renewing a license; and

2. Information submitted to the LCB for marijuana product traceability purposes. This information includes:

  • Marijuana product ownership;
  • Locations;
  • Contact information;
  • Movements of product;
  • Financial information;
  • Purchase and sale of marijuana;
  • Account numbers or unique identifiers; and
  • Related information that would identify a person or location.

Your Association has concerns that the bills would create an impediment to credit unions banking marijuana businesses given the affirmative duty of ongoing monitoring of these accounts to stay in compliance with FinCEN guidance, the Department of Justice Cole Memo, and ongoing SAR reporting responsibilities. Unfettered access to information submitted to and gathered by the LCB on licensees and prospective licensees as well as to the LCB’s traceability software is critically important to perform the ongoing due diligence credit unions are required to when banking these businesses.

Calling all Credit Union Advocates to Credit Union Day at the Capitol

Join us! On Thursday, February 4 we will be holding our annual Credit Union Day at the Capitol in Olympia. Our goal is to have every legislator receive a visit from a credit union constituent on that day. The conference is free and the short program makes sending branch staff easier.

Details:

  • 10 a.m. – 4:00 p.m.
  • Free registration
  • Free parking (space limited)
  • No tie required (dress as you would for work—logo-wear encouraged!)

If our state legislators don’t know anything about credit unions, or the great things we do for our members and our communities, then they assume we are just like banks.

Come help us spread the word about how credit unions are different. Register today!

Need More Background on This Year’s Legislature?

In even-numbered years the Washington State Legislature meets for 60 days. If necessary, the Governor can call legislators in for a special session for a 30-day period. Legislators can call themselves into special session with a two-thirds vote of the two bodies.

The legislature’s focus for the next 60 days will be on a supplemental budget and on making progress in finding a funding solution for K-12 education, implementing the state’s remaining obligations under the Supreme Court’s McCleary decision, and ending the daily $100,000 Supreme Court fines.

The ruling said the state wasn’t spending enough on basic education, including teacher salaries, and depended too much on local tax levies. The legislature faces a 2018 deadline to finish paying for its previous commitments to improve education.

As a result of the 2015 special elections, the house of representatives is now comprised of 50 Democrats and 48 Republicans, with Rep. Teri Hickel (R-30) defeating Democrat Carol Gregory who had been appointed to the seat after the death of Roger Freeman. In the Senate, Republicans maintain a 25-24 majority over the Democrats.

Changes to Our Key Committees for 2016

The House Business & Financial Services Committee continues to be Chaired by Rep. Steve Kirby (D-29), while Rep. Derek Stanford (D-1) replaced Rep. Cindy Ryu (D-32) as Vice Chair (after Rep. Ryu was appointment as Chair of the House Community Development, Housing & Tribal Affairs Committee).  Also, Rep. Mary Dye (R-9) has replaced Rep. Kevin Parker (R-6) on the committee.

The Senate Financial Institutions & Insurance Committee continues to be Chaired by Sen. Don Benton (R-17), with Sen. Jan Angel (R-26) serving as Vice Chair, however Sen. Sharon Nelson (D-34) has replaced Sen. Jeannie Darneille (D-27).

Look for the Washington Legislative Week in Review each week during session in Anthem.

Questions? Reach out to Mark Minickiello, Vice President, Legislative Affairs at mminickiello@nwcua.org.

Posted in Article Post.