LEGISLATIVE UPDATE

TO: CEOs, Presidents & Legislative Contacts

FROM: Charles M. Miller, SVP / Director of Legislation & Regulation

DATE: March 27, 2009

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Things are fast and furious at the Capitol as the proposed adjournment date of April 10^th quickly approaches. The ABA has accomplished its goals for the 2009 Session - we have passed a few clean-up bills and stopped several others that would have been harmful to our industry.

HB 2228 by Rep. Joan Cash, D-Jonesboro, which was originally introduced as an incomplete or “shell” bill, has been amended and now it changes the Fair Debt Collections Practices Act. Fortunately, her bill, as amended, continues the exemptions for banks.

HB 2218 would force a lender to allow a renting tenant to remain in a house up to 90 days after the property was foreclosed. Rep. Carroll presented his bill in Committee this week; however, the Do Pass motion failed. Although he can bring HB 2218 up again, that is doubtful and I believe the bill is dead.

HB 2203 by Rep. Darrin Williams, D-Little Rock, regulates entities that make tax refund anticipation loans (H&R Block etc…). The bill, which does not apply to banks, passed out of the House Insurance and Commerce Committee this morning.

HB 2110 would create the most restrictive law in the country dealing with the use of SSNs and make misuse a criminal offence. It appears that this bill will die in committee.

HB 1984 to require agricultural liens be filed with the Secretary of State had to be amended in the Senate. Because of objections by the Arkansas Rice Growers Association, we had to carve out farm-stored commodities financed by a loan through the Commodity Credit Corporation of the USDA. If enacted, HB 1984 will eventually force all liens and financing statements to be filed in the Secretary of State Office, with the only exception being CCC/USDA loans which will still be filed at the county level.

HB 1935 was introduced to repeal the pay-day lender act. Unfortunately, the exemption for banks is poorly drafted and could call into question interest rate limits on loans made by banks. I do not think this bill will be presented again and will almost certainly die.

HB 1885 would require that hold harmless language in contracts be stated in a conspicuous manner. Although amended at the request of several trade associations, it now looks like this bill will not get out of the Senate Insurance and Commerce Committee.

HB 1867 is in response to a lawsuit in which the courts ruled against the lender in a case where a forged document was used to release a legitimate lien and have a clean duplicate title issued. HB 1867 will prevent this from happening in the future - it now awaits Governor Beebe’s signature.

HB 1607 which is a technical correction to a credit card processing bill from the 2007 Session, is now on the Governor’s desk.

HB 1392 addressed lien priority for proposed improvement districts. As amended, the bill balances the interests of banks with existing purchase money liens and banks that will eventually hold the bonds. HB 1392 is now Act 501.

So far the ABA has had a good session. There have been a few hiccups but I feel that come April 10^th, or whatever day they go home, each of you will be pleased with what we accomplished.