January 23, 2012
RECENT ACTIVITY ON MAJOR BILLS
The LD 145 work session was held on Tuesday, January 17th. Despite excellent contacts made by bankers to all members of
the Judiciary Committee, we ended up on the short side of a 9-2 vote with two committee members absent from the vote.
We are optimistic that the final vote will be 9-4. Proponents of the bill (requiring the original documents for foreclosure)
amended the bill by removing some language that would have penalized lenders for non-compliance but kept the language
that provides opportunities for consumers to delay foreclosures. LD 145 still requires lenders to provide a suitable time and
place for documents to be reviewed but does not clearly require borrowers to meet that time frame for inspection. The bill
may lead to additional foreclosure delays. Every bank in Maine will be negatively impacted if LD 145 is passed by the
Here are the main reasons why bankers will not compromise on LD 145.
1. We already compromised. Presentment of the original note to commence a foreclosure was discussed in 2009, and a
delicate compromise was reached. In 2009, bankers agreed to amend Maine law to require a lender to show proof of
ownership of the mortgage note at the commencement of the foreclosure. (MRS Title 14 §6321 COMMENCEMENT
OF FORECLOSURE BY CIVIL ACTION was amended by P.L. 2009, c. 402.)
2. LD 145 is redundant and unnecessary legislation. Recent Court Rulings have reaffirmed the Court’s position that
requires a lender to prove ownership of the note before a foreclosure action is finalized. Current Maine law and
Court Rules have proved effective in helping to uncover document inconsistencies. The current legal tools available
to consumers and their lawyers have worked. Therefore, LD 145 is not necessary and is, in fact, redundant.
3. Passage of LD 145 will not enhance consumer protections, but it will cause further delays in foreclosures. A
December 2010 study “The Influence of Foreclosure Delays on future Defaults, Loan Losses, and Contract Rates” by
economists Shuang Zhu and Kelley Pace at Louisiana State concluded that there are negative effects of extending
foreclosure forbearance, including further delaying a housing market recovery. Delaying Maine’s housing recovery
will not help Maine’s citizens and will hinder Maine’s economic recovery.
MBA’s ACH bill LD 1637 is scheduled for a public hearing on January 25th at 10 a.m. in the Insurance and Financial Services
Committee. Maine’s privacy law, unlike GLBA, covers both consumer and commercial accounts. Maine privacy law provides a
carve out for “fraud or risk control purposes” for consumer accounts but not for non-consumers. The purpose of LD 1637 is to
amend Maine law to provide the same “fraud or risk control” carve out for non-consumer accounts that currently exist for
consumers in Maine law.
NEW MAJOR BILLS PRINTED (OPLA SUMMARY)
LD 1616 An Act Concerning Copying Fees for Users of County Registries of Deeds. Currently, the fees specified in statute for
making abstracts and copies of records at county registries of deeds will be repealed July 31, 2012 and beginning August 1,
2012 county commissioners will set the fees. This bill eliminates the repeal and letting the county commissioners set the fees
and continues the fees specified in statute. This bill has an emergency preamble.
LD 1619 An Act to Resolve Conflicts in the Implementation of the Maine Uniform Building and Energy Code. This bill limits the
scope and effect of the Maine Uniform Building and Energy Code to those municipalities that have adopted or are enforcing
the Maine Uniform Building and Energy Code or a portion of the Maine Uniform Building and Energy Code. Under this bill, the
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requirement that a building official be certified in the enforcement of the Maine Uniform Building and Energy Code, and the
inspection of buildings and issuance of occupancy permits only upon compliance with the Maine Uniform Building and Energy
Code, applies only in those municipalities that have adopted or are enforcing the Maine Uniform Building and Energy Code or
a portion of the Maine Uniform Building and Energy Code. This bill also specifies that a municipality that adopts the Maine
Uniform Building and Energy Code or a portion of the Maine Uniform Building and Energy Code may do so by reference, as is
allowed for other codes.
LD 1637 An Act to Permit Financial Institutions to Share Certain Information for the Purpose of Preventing Electronic Bank
Card Losses and Other Fraud. Current law permits the sharing of financial records information under the exemptions in the
federal Gramm-Leach-Bliley Act and its implementing regulations. Financial institutions can share information about
individuals in order to protect against fraud, unauthorized transactions, claims and other liability. This bill allows financial
institutions to share financial records information about business customers, other than individuals, for the same purposes.
LD 1716 An Act to Require Funds for Prearranged Funerals to be Invested to the Requirements of the Maine Uniform Prudent
Investor Act and to Update Related Provisions. This bill requires that funds held in prearranged funeral and burial plans be
invested and managed consistent with the prudent investor rule and related requirements of the Maine Uniform Prudent
Investor Act. It also provides that such funds may be deposited in a national banking institution authorized to act as a fiduciary
pursuant to federal law and the regulations of the federal Office of the Comptroller of the Currency. (January 31st – 1 p.m.)
LD 1778, An Act Relating to the Governance of the Maine State Housing Authority. This bill removes the provision of law that
provides that the Director of the Maine State Housing Authority serves a 4-year term of office. The bill provides that the
director does not have a term of office and that the director serves at the pleasure of the commissioners of the Maine State
Housing Authority. It also removes the provision of law that states that the powers and duties of the Maine State Housing
Authority, with certain exceptions, are vested solely in the Director of the Maine State Housing Authority.
LD 1787, An Act To Create Efficiencies in the Administration and Enforcement of the Maine Uniform Building and Energy
Code. The purpose of this bill is to create efficiencies in the administration and enforcement of the Maine Uniform Building
and Energy Code, primarily by abolishing the Department of Public Safety, Bureau of Building Codes and Standards and
moving its authority and responsibilities to a new division created in the Office of the State Fire Marshal. This bill also corrects
cross-references and inconsistencies in the threshold for municipal populations to which the provisions of the Maine Uniform
Building and Energy Code apply.
The Maine Bureau of Financial Institution’s Annual Report was delivered to the Legislature on January 15 th. Superintendent
LaFountain has released the 2012 Annual Report, and it can be accessed on the web.
Maine Council of Elder Abuse Prevention (MCEAP). MBA attended the first meeting of the newly created MCEAP Council
which is made up of a diverse group of stakeholders who routinely work with Maine’s aging population (e.g., law
enforcement, DHHS staffers, AARP, the Bureau of Securities and the Bureau of Financial Institutions) in many different
capacities. MBA and MCUL were asked to join the council to help educate members about elder financial exploitation. The
mission of the Council is to:
Promote a unifying vision for the prevention of elder abuse that leads to action;
Foster awareness of existing resources and efforts and opportunities for collaboration;
Coordinate responses and solve problems (in general and case by case);
Influence public policy through advocacy;
Establish and maintain a forum for communication;
Provide a forum/think-tank for new ideas and approaches; and,
Support and coordinate training and education efforts.
MBA Meet Your Local Banker
Mark Your Calendars and Watch for Registration Information
Governor Hill Mansion - Augusta
March 7th - 5 to 7 p.m.
Legislative Report | www.mainebankers.com | 207.791.8400