Indepth | Fourth Quarter 2006

This year marked the second session of the 94th Illinois General Assembly (IGA) and featured an intentionally shortened schedule with a slated adjournment on April 7, 2006 — nearly two months earlier than normal. As a result, lawmakers focused primarily on the budget and "emergency" legislation, and were informed by legislative leaders to limit themselves to as few as three bills per member. Still, nearly 3,000 new bills were filed for consideration, including a legislative initiative introduced by ICUL to resolve the litigation over regulatory fees. In pursuing a credit union friendly legislative agenda, ICUL dealt with nearly 300 other bills that potentially had some impact on credit unions and/or their operations. Although the Spring session of the IGA actually concluded nearly a month later than scheduled on May 4, 2006, this type of environment still made it difficult for the League to implement its legislative plans.

Below is a summary of bills the League either initiated or played a role in during the Spring session.

Notary Public – Real Estate
SB 304	M. Sandoval, et al.	Implements the High Risk Home Loan Act. Establishes standards, limitations and disclosures relating to predatory mortgage loans. Amends legislation passed effective January 1, 2006, revising the Residential Real Property Disclosure Act to establish a data submittal process to establish lender compliance with regard to non-purchase money closed-end home equity loans, where either the APR or the points and fees exceed certain triggers. Provides that IDFPR establish a predatory lending database pilot program by September 1, 2006. Pilot applies to all residential mortgage applications in 10 zip code area of Cook County, Illinois, as designated by IDFPR. Provides pilot program is effective for four years. The program is not applicable to credit unions or other financial institutions. However, CUSOs licensed under the Illinois Residential Mortgage Licensee Act are subject to the database submittal process. Even though financial institutions are exempt, they must attach a certificate of exemption to any mortgage on property in the subject area they directly record.	Neutral (in light of existing exemption for financial institutions)	Signed into Law by Governor Blagojevich on July 14, 2006, as P.A. 94-1029 (eff. 07/14/06)
Real Estate Appraisals
SB 482	Sen. Debbie DeFrancesco Halvorson-Deanna Demuzio-M. Maggie Crotty-Antonio Munoz (Rep. Angelo Saviano)	House Amendment No. 5 becomes the bill and updates the Real Estate Appraiser Licensing Act of 2002. The amendment removes the current exemption from a licensed appraisal for loans under $250,000. Federal laws and regulations (FIRREA) specifically exempt financial institutions form the appraisal licensing requirements for loan underwriting activities for loans under $250,000 that are used solely for in-house purposes within a financial institution. This exemption has been in place since 1989.	Oppose	5/05/06 – House Rule 19(a) / Re-referred to Rules Committee
Financial Industry Coalition Fee Reduction Initiative
HB 2495	Sen. Terry Link-William R. Haine-Gary Forby -Dan Rutherford, et al (Rep. Jay C. Hoffman-Robert F. Flider-Jim Durkin-Sandra M. Pihos-Dave Winters, et. al.)	Amends the Illinois Banking Act, the Illinois Savings and Loan Act of 1985, the Savings Bank Act and the Illinois Credit Union Act to restore (in the case of credit unions that pay regulatory fees pursuant to statute) and require the restoration of (in the case of banks and savings banks that pay regulatory fees pursuant to rule), the rate for such fees to the pre-BIMP 04 escalation levels.	Support 11/18/05 League initiative to resolve regulatory fee litigation	2/27/06 - Third Reading – Passed Senate; 051-000-000 2/28/06 - Referred to House Rules Committee
Power of Attorney — Payable on Death Accounts
SB 2676	Sen. Ira I. Silverstein (Rep. Elaine Nekritz )	Amends the Illinois Power of Attorney Act to provide the powers granted in the statutory short form power of attorney for property are expanded so that an agent may open, close, or control a Totten Trust, a Payable on Death Account, or a similar arrangement with a financial institution. The agent's authority does not include any powers over accounts titled in the name of a trust pursuant to the Trust and Trustees Act, unless specifically authorized by a person's power of attorney for property. Creates an exception for Totten Trusts, Payable on Death Accounts, or similar accounts to the existing prohibition against an agent revoking or amending any trust for the benefit of the principal in order to pay income or principal to the agent, without specific authority to do so.	Support	Signed into Law by Governor Blagojevich on June 26, 2006, as P.A. 94-0938 (eff. 01/01/07)