Date Requested:February 14, 2014
Time Requested:10:20 AM
Agency: Financial Institutions, West Virginia Division of
CBD Number: Version: Bill Number: Resolution Number:
2014R1854 Amendment HB4290
CBD Subject: regulatory structure of money transmitters
FUND(S)
3041
Sources of Revenue
Special Fund
Legislation creates:
Neither Program nor Fund

Fiscal Note Summary

Effect this measure will have on costs and revenues of state government.

     This bill will increase the revenues of the WV Division of Financial Institutions (WVDFI), a special revenue agency. It will not increase the costs since those costs associated with regulating the industry have already increased due to the rapid growth in the number of licensed money transmitters. In 2003, the WVDFI had 18 licensees under this law. It now has 59 with another application pending. In FY 2013 the WVDFI hired an additional examiner to assist with the increased demands on the agency.

Fiscal Note Detail
Over-all effect
Effect of Proposal Fiscal Year
2014
Increase/Decrease
(use"-")
2015
Increase/Decrease
(use"-")
Fiscal Year
(Upon Full
Implementation)
1. Estmated Total Cost 0 0 0
Personal Services 0 0 0
Current Expenses 0 0 0
Repairs and Alterations 0 0 0
Assets 0 0 0
Other 0 0 0
2. Estimated Total Revenues 0 210,476 210,476
3. Explanation of above estimates (including long-range effect):
     The increase in revenue to the agency assumes that the bill would take effect at the beginning of FY 2015. The estimate is based upon the number of licensees as of 12/31/13 and the amount of activity most recently reported by those licensees to the WVDFI.
    
     The intent of the proposed changes to the fee structure is to make it fairer so that companies with a higher volume of transactions would pay a greater share of regulatory costs. Consequently the bill reduces the per delegate fee from $20 to $5 each year and eliminates the $50/hour charge for examiner time and adds an assessment of up to $.001 per dollar of transmission volume while increasing the overall cap on fees from $10,000 to $25,000.
    
     Under the data currently available to the agency, we expect that 10 licensees would see a reduction in fees, 33 would pay more and 14 would pay the same.
    


Memorandum
Person submitting Fiscal Note:
Robert Lamont
Email Address:
blamont@wvdob.org
     The figures cited above are based upon the data available to the WVDFI as of 12/31/13 which includes the transmission volume as reported to the agency by the licensees. The increase in revenue could be subject to upward revision in ensuing fiscal years due to at least 2 other factors: A continued increase in the number of licensees and the discovery during an examination of under-reporting of transmission activity by current licensees.
    
     Since the WVDFI is a special revenue agency, it must recover sufficient revenues to meet the costs of regulating this particular industry. If not, then other regulated entities (e.g., state-chartered banks, mortgage lenders and brokers) would be forced to subsidize the shortfall.