FISCAL NOTE
Date Requested: March 12, 2025
Time Requested: 01:45 PM |
| Agency: |
Financial Institutions, West Virginia Division of |
|---|
| CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
| 3684 |
Introduced |
SB729 |
|
|---|
| CBD Subject: |
Consumer Protection |
|---|
|
FUND(S):
3041 Assessment and Examination Fund
Sources of Revenue:
Special Fund
Legislation creates:
Increases Existing Expenses
Fiscal Note Summary
Effect this measure will have on costs and revenues of state government.
Senate Bill 729 changes the permissible loan amount and interest rate for regulated consumer lenders, a type of license that allows a certain group of lenders to make loans at a higher rate than the default interest rate in West Virginia of 18% for loans and 25% for consumer credit sales. The Division anticipates that for at least the next couple of examination cycles, which happen every 18 months, it will spend additional time reviewing a larger sample of loans than it has done historically to ensure compliance with the statute and monitor the effect of the updated loan amount and interest rate.
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2025
Increase/Decrease
(use"-") |
2026
Increase/Decrease
(use"-") |
Fiscal Year
(Upon Full
Implementation) |
| 1. Estmated Total Cost |
0 |
10,000 |
20,000 |
| Personal Services |
0 |
0 |
0 |
| Current Expenses |
0 |
10,000 |
20,000 |
| Repairs and Alterations |
0 |
0 |
0 |
| Assets |
0 |
0 |
0 |
| Other |
0 |
0 |
0 |
| 2. Estimated Total Revenues |
0 |
0 |
0 |
Explanation of above estimates (including long-range effect):
The Division estimates increased examination expenses of $10,000 per examination cycle (every 18 months) over the next several cycles to ensure compliance with statutory changes and subsequent effects of the interest rate increases. The estimate for examination cost increases was calculated using the invoices for the past two examination cycles of Regulated Consumer Lenders. These costs consist of travel expenses and examiner hours. The review sample from the previous two examination cycles was also used to estimate the increased hours that will be needed for regulatory oversight upon passage of the bill.
Memorandum
The bill is straightforward, but the Division of Financial Institutions anticipates at least a short-term impact to expenses so that it may increase its sample size of loans reviewed on examinations of regulated consumer lenders.
Person submitting Fiscal Note: Kathy Lawson
Email Address: klawson@wvdob.org