Legislature(2009 - 2010)BUTROVICH 205
03/31/2009 01:00 PM Senate LABOR & COMMERCE
| Audio | Topic |
|---|---|
| Start | |
| Governor's Appointments | |
| SB170 | |
| SB60 | |
| SB149 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| += | SB 149 | TELECONFERENCED | |
| += | SB 60 | TELECONFERENCED | |
| *+ | SB 170 | TELECONFERENCED | |
| + | TELECONFERENCED |
SB 149-MORTGAGE LENDING
2:27:07 PM
CHAIR PASKVAN announced the consideration of SB 149.
2:27:29 PM
TYSON FICK, Legislative Liaison, Department of Commerce,
Community & Economic Development (DCCED) said all the parties
involved - interest groups, Department of Law, Division of
Banking and Securities, especially Director Lorie Hovanec -
agreed they want to get to federal compliance especially with
the national data base. SB 149 would take large portions of the
Alaska's current mortgage licensing statute and put it into
regulation that would, then, be in compliance with the federal
Secure Fair enforcement for Mortgage Licensing Act (SAFE) that
was enacted and signed about a month after Alaska's mortgage
licensing bill went into effect.
2:29:20 PM
SENATOR THOMAS moved to adopt CSSB 149 version\E for discussion
purposes. There were no objections and it was so ordered.
2:30:41 PM
LORIE HOVANEC, Director, Division of Banking and Securities,
Department of Commerce, Community & Economic Development, said
she was very happy with the language in the CS to SB 149.
2:32:56 PM
Rather than having the general authority to create regulate
mortgage lending, which is in AS 06.01.050 starting on page 1,
at the Legislature's direction they added a lot of federal "nuts
and bolts" requirements. The CS adds various sections with
background checks, investigation, education requirements,
testing requirements, issuance of a license - duration and
renewal standards, surrender of license, licensee obligations,
records that mortgage licensees are required to keep, and
disciplinary actions that the division has available. Page 7
outlines the investigation and examination authority in detail.
The section on duties and restrictions and prohibited activities
are mostly taken from current law, but items 3-15 were added
from the SAFE Act. More specifics on criminal penalties were
added along with civil penalties addressing unfair trade
practices.
2:35:46 PM
CHAIR PASKVAN asked if there are time requirements for the
committee to consider.
MS. HOVANEC replied that the federal statutes require enactment
by July 30, 2009. The department also needs authority from the
Legislature to join the National Mortgage Licensing System and
Registry (NMLSR) so that the division can start licensing
mortgage loan originators through it. They are scheduled to join
that system on August 1, 2009. Section 13 on the last page has
an effective date language of July 30 for certain portions. They
also have to pay a $50,000-one time fee to participate.
2:37:07 PM
SENATOR BUNDE said earlier this year the licensing division's
workload was backed up under just the state's law, and asked if
she thought there was enough lead time for people to get
licensed in a timely fashion now that they have to be licensed
on the federal level as well.
MS. HOVANIK replied yes. She explained that current licensees
have even more time than a brand new applicant who will be
seeking a license. "I think the way the statute is written is
very fair."
2:38:22 PM
PATRICE WALSH, Consumer Finance Chief, Division of Banking and
Securities, Department of Commerce, Community & Economic
Development, said she was available to answer questions on SB
149.
SENATOR THOMAS asked if anything corrects issues like the one
from Countrywide that was licensing people as insurance agents,
but they were doing other things like mortgage lending as well.
MS. WALSH said she wasn't familiar with that issue.
2:39:52 PM
JOHN MARTIN, President, Alaska Association of Mortgage Brokers,
said he is a mortgage Licensee and originator Licensee under AS
06.60 mortgage licensing law. He explained that some entities
under current law were exempt from being licensed under Alaska
law, and Countrywide ended up becoming a bank. So under federal
regulations, they were exempt from the state's current AS 06.60.
They would have to apply for an exemption for that and he didn't
know that they had - or some of the other banks either.
He said that the Alaska Association of Mortgage Brokers along
with the Alaska Mortgage Bankers Association were instrumental
and heavily involved in the creation of Alaska's existing
statute. It took two years of concentrated work and working
closely with the Division of Banking to update the statutes. He
explained that Congress enacted the SAFE Act as part of the
Housing and Recovery Act of 2008, which is why the current bill
is before them. Generally states are free to regard the
requirements of the SAFE Act as a floor, not a ceiling, which
they may build on in enacting their own licensing and
registration laws. The SAFE Act encourages states to establish a
National Mortgage Licensing System and Registry to be developed
and maintained by the Conference of State Bank Supervisors and
the American Association of Residential Mortgage Regulators.
Alaska signed a letter of intent to join the organization on
August 1, 2009.
It's intended to streamline the licensing process and reduce the
regulatory burden. While the states must meet the federal
requirements of SAFE, overall responsibility for interpretation,
implementation and compliance with it rests with HUD. Title 5 of
the Act for mortgage licensing affirms that any residential
mortgage loan originator must be either state licensed or
registered by August 1, 2009.
MR. MARTIN explained that under section 15.08, HUD must
determine if the state has met the requirements of Section
15.05, 15.06, 15.08(d) or that it does not participate in the
National Mortgage Licensing System and Registry.
2:45:43 PM
CHAIR PASKVAN called an at ease because of teleconference
technical difficulties.
2:48:35 PM
CHAIR PASKVAN called the meeting back to order at 2:48, and
continued by asking how all 50 states could comply by August 1.
MR. MARTIN explained the SAFE Act provided a waiver for up to 24
months for states that show a good faith effort for compliance
by August 1, 2009. He said that compliance was mandated by the
SAFE Act, but no funds were provided for it. With the state's
existing law and joining NMLSR, it will be able to get a waiver.
Forty other states are working on legislation; just nine have
enacted legislation so far. AS 06.60 substantially conforms with
the SAFE Act; in fact it references Alaska's statutes
frequently.
2:50:36 PM
He asked them to hold the bill, so if any changes are needed to
the new CS, they can do them in a couple of days and get the
bill passed this year.
2:53:56 PM
LOUANNE WEYHRAUCH, Assistant Attorney General, Department of Law
(DOL) representing the Division of Banking and Securities, said
she would take questions today and reserve her comments. She
said that Julia Coster, Assistant Attorney General, who works in
the Consumer Protection Division of DOL was also available to
answer questions.
2:54:47 PM
SENATOR BUNDE asked if they supported the changes in version E
of SB 149.
2:55:19 PM
JULIA COSTER, Consumer Protection Unit, Department of Law (DOL),
said she had a small provision in section 9 (page 35, line 10)
is a repeal of AS 45.50.471(b)(52) referring to the Consumer
Protection Act. This provision makes a violation of the Mortgage
Lending Act a violation of the Consumer Protection Act as well.
The DOL doesn't necessarily object to the repeal of this
section, but they wanted the committee to consider adopting a
letter of intent relating to it.
MS. COSTER said if they are going to hold the bill anyway, it
might be good to wait until the committee has the language of
the letter of intent before it first; then she could discuss why
she thought it was necessary.
CHAIR PASKVAN agreed with her and held SB 149 for further work.
| Document Name | Date/Time | Subjects |
|---|---|---|
| Governor's Appointments.pdf |
SL&C 3/26/2009 1:30:00 PM SL&C 3/31/2009 1:00:00 PM |
|
| CSSB 149 version E.pdf |
SL&C 3/31/2009 1:00:00 PM |
SB 149 |
| SB 149 Bill Packet.pdf |
SL&C 3/19/2009 1:30:00 PM SL&C 3/31/2009 1:00:00 PM |
SB 149 |
| SB 60 Bill Packet.pdf |
SL&C 3/24/2009 1:30:00 PM SL&C 3/31/2009 1:00:00 PM SL&C 4/16/2009 1:00:00 PM |
SB 60 |
| SB 170 Bill Packet.pdf |
SL&C 3/31/2009 1:00:00 PM |
SB 170 |