Capitol Link

Capitol Link keeps our members informed about the latest legislative activity in St. Paul and in Washington D.C. Capitol Link is sent weekly while the state legislature is in session.

With session ending soon, legislative leadership focuses on state budget

May 7, 2019

With committee deadlines now passed, ICBM’s government relations team is less concerned with policy-only bills. Between now and the end of session, new policy-only bills require a rare procedural tactic – saved mostly for bills that have broad agreement and are of urgent concern – to have any chance of reaching the governor’s desk.

We continue to monitor for amendments to bills already moving through the process. The House Jobs and Economic Development committee’s omnibus bill (HF 2208, Mahoney), for example, still contains the Department of Commerce’s proposed changes to unclaimed property policy.

We’ve reported previously that Commerce’s initial proposal for unclaimed property was problematic for community banks. The bill was based on Illinois’ unclaimed property law – our counterparts in Illinois have informed us that their state’s law has proven difficult and even problematic for banks to administer.

One example of problematic elements of the bill was that it did not originally consider automatic debits or credits to be an indication of interest in a bank account. Some firsthand experience shared by Jim Amundson, our resident community banker, helped Commerce to see the unintended consequences of this provision. What happens to often long-dormant bank accounts set up by parents for their children? These are often used to save for college and have no other activity than an auto-credit.  

While the current version contains many of the changes suggested by industry trade groups, there are still some that have not yet been written into the bill. And, rather than patching up Illinois law, industry trade groups are advocating that Commerce pause progress on the bill so it gets done right the first time. 

Elder Financial Abuse

Industry trade groups have identified a potential bill, HF 1960/SF 2310 (Richardson/Utke), to which we can attach elder financial abuse legislation. As a reminder, we’ve been part of a coalition working toward legislation that provides community banks the same “immunity” as investment advisers since the beginning of session.

HF 1960/SF 2310 is the Department of Commerce’s policy and technical bill. Senator Utke (R-Park Rapids) has indicated interest in amending his bill to include the language but is uncertain when they will take up the bill. The bill has already passed the House, and if amended by the Senate would force the House to concur with Senate changes or force a conference committee.

Capital Update

May 6 marked the deadline by which Governor Tim Walz, Senate Majority Leader Paul Gazelka and Speaker of the House Melissa Hortman agreed to release budget targets to committee chairs. 

The leaders remained cordial during post-negotiations press conferences, but it is clear that significant differences must be resolved in order for the legislative session to be brought to a tidy end.

Senate Republicans have been clear in their objections to an increase in the state’s gas tax, as proposed by House Democrats and Governor Walz. During an exchange of offers, Governor Walz indicated a willingness to cut $200 million in spending from his budget recommendations but insisted on the continuation of the health care provider tax and his transportation proposal.

In the Senate counteroffer, Senator Gazelka proposed an additional 12 percent in education funding, rejected the continuation of the provider tax and gas tax, and proposed that savings found in health and human services programs be dedicated to education funding.

While these negotiations continue, conference committees are meeting and taking testimony as it is difficult to consider many provisions without budget targets. The next self-imposed deadline is May 13, when leaders agreed that conference committees are to have completed their work and sent conference committee reports to the House and Senate floors.

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