|Date Requested:February 09, 2005
Time Requested:01:58 PM
| FUND(S) |
Sources of Revenue
Legislation creates:Neither Program nor Fund
Effect this measure will have on costs and revenues of state government.
| This bill will transfer the responsibility for registering and overseeing those lenders subject to the law from the Tax Division to the Division of Banking. This is a step that is in line with the proposed reorganization of the Department of Tax and Revenue. It will increase the costs of the Division of Banking since it will be undertaking new responsibilities.
Currently the Division of Banking already charters or licenses other financial institutions and examines them for compliance with consumer protection laws. Since the Division of Banking is a special revenue agency, any additional regulatory responsibility imposed by law must include sufficient funds from the entities regulated or else those entities already under the Division's jurisdiction (state-chartered banks and credit unions, mortgage lenders and brokers and regulated consumer lenders) would be forced to subsidize this new responsibility through higher assessments.
|Effect of Proposal||Fiscal Year|
|1. Estmated Total Cost||0||15,000||15,000|
|Repairs and Alterations||0||0||0|
|2. Estimated Total Revenues||0||15,000||15,000|
3. Explanation of above estimates (including long-range effect):
These estimates are based upon a list of the entities that filed a notification with the Tax Division two years ago after first deducting for the entities that the proposed bill would exempt because they are already subject to licensing and regulation by the Division of Banking. After that deduction, approximately 100 entities would have to pay the $150 fee.
The costs are based upon estimates of the amount of time that would be taken processing the registrations, maintaining the database, and handling consumer complaints regarding those entities that are registered. These costs would include a part-time clerical position and portions of the time for a supervisor and attorney along with other direct or indirect costs for rent, equipment and software, and other administrative overhead.
| Although the Division proposed this bill two years ago, just as we indicated in 2004, the Division of Banking no longer wishes to pursue it.