2004 State Chaptered Legislation
DFI SPONSORED BILLS
AB 2014 (Wiggins) Chapter 324 on 8/30//04.
Credit Unions. This bill makes two changes to Financial Code sections under the Credit Union Law as administered by the Department of Financial Institutions. The changes would include: 1.) amendment of Financial Code section 14252 by eliminating the requirement to obtain and file an opinion audit for those credit unions with assets of $10 million or less and to instead allow these credit unions to submit an audit report consisting of alternative procedures acceptable to the Commissioner. 2.) repeal of Financial Code section 14703 (b) eliminating state chartered credit unions from the requirement to transfer at the end of an accounting period an amount equal to its allowance-for-loan-losses expense from its required reserve account to its undivided earnings account.
SB 1637 (Florez) Chapter 176 on 7/19/04.
Financial Institutions. This bill makes various technical clean-up changes to certain sections of the Financial Code relating to the Banking Law as administered by the Department. These changes would include 1.) Section 253: Changing the archaic language (the word "folio") and replacing it with Plain English (the word "copy"). 2.) Heading to Article 1, Chapter 17: Change to reflect that the Commissioner is the head of the Department, not the Superintendent. 3.) Section 1000: Clarifying that savings banks may not enter the state through the Savings Association Law. The proposed change will not affect how foreign (other state) savings associations may enter the California market. These savings associations will still be governed by the Savings Association Law.
BILLS POTENTIALLY AFFECTING THE ADMINISTRATION OF THE DFI
AB 79 (Dutra) Chapter 409 on 9/9/04.
Written reports: preparation. Existing law requires various written reports to be prepared and submitted by state and local agencies to the Legislature or the Governor. This bill , until January 1, 2008, provides that a public agency, as defined, may, but is not required to, prepare or submit any written report to the Legislature, the Governor, or any state legislative or executive body unless any one of specified conditions is met or the report is required to be prepared and submitted pursuant to this bill. This bill declares that it is to take effect immediately as an urgency statute.
AB 806 (Wiggins) Chapter 26 on 3/17/04.
State Contracts: personal services. Existing law permits state agencies to enter into personal services contracts when certain conditions are met. These conditions include requiring a state agency that enters into a personal services contract to include provisions for employee benefits that are valued at least 85% of the state's cost of providing comparable benefits to state employees performing similar duties. Existing law defines 'benefits" to include health, dental, and vision and wages benefits. This bill excludes from these requirements contracts that are performed by employees of nonprofit organizations that are employed pursuant to a specified license, certificate, community rehabilitation plan, or a habilitation services program.
SB 111 (Knight) Chapter 193 on 7/23/04.
State reporting requirements. (1) Existing law requires various state agencies to prepare and submit reports to the Legislature and Governor on various topics throughout the year. This bill deletes various reporting requirements. (2) Existing law establishes, for specified time periods, pilot and demonstration projects regarding specified issues. This bill repeals these provisions.
SB 1041 (Committee on Budget and Fiscal Review) Chapter
23 on 3/5/04.
Budget Act of 2003. This bill amends the Budget Act of 2003 by revising various items of appropriations and authorizing the Director of Finance to revert additional amounts from specified funds to the General Fund. This bill provides that it to take effect immediately as an urgency statute.
BILLS POTENTIALLY AFFECTING THE DFI AND/OR DFI LICENSEES
ACR 61 (Koretz) Resolution Chapter 19 on 3/4/04.
Financial Literacy Month. This measure declares the month of April 2004 as Financial Literacy Month, in order to raise public awareness about the need for increased financial literacy.
SJR 20 (Florez) Resolution Chapter 107 on 6/28/04.
Regulation of Financial Institutions. This measure requests the Congress of the United States to hold hearings to explore and study the growing scope of federal preemption of regulation of financial institutions and the effects on American consumers and the 75% of the banks in the United States that are state chartered banks, and if necessary, to consider legislation that will prevent the unilateral expansion of jurisdiction over financial institutions by federal regulators without the specific endorsement of the United States Congress.
AB 1933 (Pacheco) Chapter 937 on 9/30/04.
Public Records. This bill requires each state or local agency, within 20 days from receipt of a request for records, to determine whether the request, in whole or in part, seeks copies of disclosed public records. Provides that address information of an arrestee or crime victim obtained under these provisions shall remain in the physical possession of the requester and may not be provided to anyone, used to sell a product, or posted on a computer Web site.
AB 2611 (Simitian) Chapter 886 on 9/29/04.
Elder Abuse. Existing law proscribes crimes against elder and dependent adults involving physical and financial abuse. This bill would make a technical, nonsubstantive change to these provisions.
AB 2671 (Pacheco) Chapter 131 on 7/9/04.
Commercial Law: Banking Transactions. Existing commercial law requires a depository institution to provide periodic account statements to its customers and requires that the depository institution either return or make available items paid from the account or provide information in the statement sufficient to allow the customer reasonably to identify the items paid. Until January 1, 2005, the listing of the item number, the amount, and the date the item was paid is sufficient to identify the items paid. This provision on describing items will cease to be operative on January 1, 2005. This bills extends the operation of that provision until January 1, 2010.
AB 3016 (Pavley) Chapter 282 on 8/23/04.
Privacy: Social Security Numbers. Existing law prohibits a person or entity, with specified exceptions, from publicly posting or displaying an individual's social security number or doing certain other acts that might compromise the security of an individual's social security number. In this regard, existing law permits a person or entity that has used a person's social security number prior to July 1, 2002, in a manner that is otherwise prohibited, to continue to use the person's social security number in that manner if certain conditions are met, including the condition that the use be continuous. This bill removes the exception for continuous use from the provisions described above.
SB 1150 (Burton) Chapter 197 on 7/27/04.
Lender Names. This bill prohibits inclusion of a lender's trade name logo, or tagline in a written solicitation for financial services to a consumer for services or products without the consent of the lender.
BILLS OF INTEREST TO THE DFI
AB 700 (Diaz) Chapter 47 on 6/14/04.
Insurance. This bill provides that an insurer that anywhere transacts any class of insurance other than financial guaranty insurance, surety insurance, and credit insurance shall not be eligible for a certificate of authority to transact financial guaranty insurance, but in other states, may assume those classes of insurance if it is authorized to transact those lines in other states.
AB 971 (Correa) Chapter 17 on 2/23/04.
Deferred deposit transactions. Existing law makes the California Deferred Deposit Transaction Law operative on March 1, 2004 and regulates persons engaged in the business of making or negotiating deferred deposit transactions. Existing law also makes certain provisions of law regulating check cashers inoperative on March 1, 2004. This bill extends the dates on which these provisions become operative and inoperative to December 31, 2004. However, the bill would authorize the Governor to issue and executive order to make these provisions operative and inoperative at a date earlier than December 31, 2004, if the earlier date is not less than 30 days after the issuance of the executive order. This bill declares that it is to take effect immediately as an urgency statute.
AB 1000 (Dutra) Chapter 819 on 9/27/04.
Corporations: disclosure statement. Existing law, the General Corporation Law, requires domestic and foreign corporations to file annual statements with the Secretary of State disclosing specified information concerning its operations and makes the information contained in the statements open to public inspection. Under existing law, information required in the statement includes the name of the independent auditor used by the corporation and a description of any services performed during the previous 24 months by the auditor or its parent corporation, or by an agent of the auditor. This bill instead requires the corporations to disclose services performed during its 2 most recent fiscal years and the period between the end of its most recent fiscal year. In addition, existing law requires these corporations to provide a statement indicating whether any members of the board of directors or executive officer of the corporation has been convicted of fraud within the previous 10 years. This bill instead requires that statement if the conviction has not been overturned or expunged.
AB 1498 (Wiggins) Chapter 25 on 3/14/04.
State Assistance Fund for Enterprise, Business, and Industrial Development Corporation. This bill enables SAFE-BIDCO to apply for federal Community Development Federal Institutions (CDFIs) funds from the Department of the Treasury, which would give it access to additional capital in order to help more small businesses.
AB 1883 (Harman) Chapter 75 on 6/28/04
Trustees: bonds. Existing law regulates trusts and provides that a trustee is not required to give a performance bond unless a bond is required by the trust, a bond is found to be necessary by the court to protect the interests of the beneficiaries, or a person who is not named as a trustee in the trust instrument is appointed as a trustee by the court. Existing law permits a court, notwithstanding the requirement of a bond in the trust, to excuse the requirement of a bond, to change its amount, release a surety, or permit the substitution of another bond with the same or different sureties. This bill permits a court to require a bond when it is necessary to protect the interests of persons having an interest in the trust estate. The bill permits a court to excuse the requirement of a bond notwithstanding specified provisions that would otherwise require a bond.
AB 1848 (Harman) Chapter 136 on 7/13/04.
Certification of trusts: change of trustee. Existing law governs the establishment and recordation of trusts. Existing law authorizes a trustee to present a certification of trust to any person in lieu of providing a copy of the trust instrument to establish the existence or terms of the trust as specified. Existing law also makes it a felony to knowingly offer a false document to be recorded in any public office. This bill authorizes any person to record a certification of trust that relates to an interest in real property. The bill also authorizes a successor trustee to execute and record an affidavit of change of trustee if title to an interest in real property is affected by a change of trustee. The bill requires the county recorder to index this document, as specified.
AB 1855 (Maze) Chapter 189 on 7/23/04
Infrastructure and Economic Development Bank. The Bergeson-Peace Infrastructure and Economic Development Bank Act requires the California Infrastructure and Economic Development Bank to establish criteria, priorities, and guidelines for the selection of projects to receive assistance from the bank, to be based on a minimum of specified factors. This bill requires the bank to notify the Governor, the fiscal and policy committees of the Legislature that exercise legislative oversight of the bank, and appropriate state and local agencies, when the bank establishes or makes changes to the criteria, priorities, and guidelines for project selection.
AB 1979 (Wiggins) Chapter 939 on 9/30/04.
Lending: variable interest. Existing law requires a lender, other than a supervised financial institution, to set forth provisions for variable interest rates in security documents and evidence of the debt that are issued in this connection and to include specified provisions in these documents regarding variable interest rates. Existing law defines a supervised financial institution, as a state or federally regulated bank, savings association, savings bank, or credit union, or state regulated industrial loan company, personal property broker, consumer finance lender, or holding company, affiliate, or subsidiary of these entities, or institution of the Farm Credit System. This bill revises the definition of supervised financial institutions, as described above, by adding residential mortgage lenders and broadening the description of finance lenders.
AB 1990 (Campbell) Trusts: Chapter 538 on 9/15/04.
Trustee liability. This bill provides that a provision in a trust relieving a trustee of liability if a beneficiary fails to object to an item in an interim or final account or other written report within a specified time period would be effective only if certain conditions were met, including the provision of a specified notice and a period within which a beneficiary may object of not less than 120 days. Among other things, the bill would prohibit a beneficiary who fails to object in writing to an account or report that complies with these requirements from asserting any claim against the trustee regarding an item that is adequately disclosed in the account or report, with specified exceptions. The bill provides that, if proper notice has been given, and if a beneficiary has not made a timely objection, the trustee is not liable for any other claims adequately disclosed by any item in the account or report.
AB 2069 (Chavez) Chapter 140 on 7/14/04.
Real Estate. This bill repeals provisions of the Real Estate Law Pertaining to a multilender transaction that defined the term current market value for the purposes of construction and rehabilitation
AB 2156 (Reyes) Chapter 312 on 8/25/04.
Deferred Deposit Transactions. This bill requires a person who is licensed to conduct deferred deposit transactions to state the rates of charges and fees on these transactions in any advertisement disseminated in this state. Makes technical, confirming changes regarding the authority of the authority of Commissioner of Corporations to establish requirements regarding statement of rates and charges.
AB 2312 (Dutra) Chapter 760 on 9/24/04.
Point-of-Sale Devices. This bill requires that, when a point-of-sale system is upgraded to include a video touch screen or nontactile keypad, the point-of-sale device also be equipped with a tactile keypad that enables a visually impaired person to enter personal information necessary to process a transaction.
AB 2481 (Nunez) Chapter 48 on 6/18/04.
Infrastructure and Economic Development Bank. This bill relates to the California Infrastructure and Economic Development Bank. Provides that the board includes the Secretary of Business, Transportation and Housing, to act as chair of the Board.
AB 2693 (Wiggins) Chapter 940 on 9/30/04.
Lending. Under existing law, real estate licensees are licensed and regulated by the Real Estate Commissioner and finance lenders and brokers are licensed and regulated by the Commissioner of Corporations. This bill prohibits real estate licensees and licensed finance lenders and brokers from failing to disburse funds in accordance with a commitment to make a loan, or intentionally delaying the closing of a loan for the purpose of increasing specified costs to the borrower.
AB 2872 (Maddox) Chapter 334 on 8/30/04
Trusts: notices. Existing law regulates judicial proceedings relating to trusts. Existing law permits a beneficiary of a trust to file a request with a court to receive notice of specified proceedings, and requires a beneficiary to deliver a copy of such a request to the trustee, as specified. If the request is mailed, it is effective when it is received. Existing law provides that, after a request is served, the beneficiary is entitled to notice, and it provides that such a request is ineffective under certain circumstances. This bill extends the provisions described above to any person who has an interest in the trust. The bill specifies particular methods of mailing in regard to delivering a copy of the request to a trustee. The bill changes the effective date of the request, if it is mailed, to the date it is deposited in the mail.
SB 1021 (Poochigian) Chapter 54 on 7/22/04
Trusts. Existing law provides for the creation, modification, and termination of trusts, and regulates the acts of trustees in administering a trust. Existing law establishes provisions by which a trustee may give a notice of proposed action regarding certain matters. This bill revises and recasts the provisions by which a trustee may give a notice of proposed action. The bill enlarges the circumstances under which a notice of proposed action could be used, the circumstances under which it is not to be used, to whom it is to be given, and the methods by which a beneficiary may object to a proposed action.
SB 1277 (Ackerman) Chapter 177 on 7/20/04.
Mortgages: foreclosure. This bill makes various amendments to sections of the Civil Code and the Revenue and Taxation code relating to mortgages, including the specification of recording of notices of default and sale and the defining of who is authorized to make those recordings.