April 10, 2019


In This Issue:

  • Legislative Update: TLTA's Legislative Priorities Advancing as Planned and Objectionable Bills Remain Static
  • Texas Senate Passes Two-Year Budget With Money for Property Tax Cuts — But No Plan for How to Spend It
  • Commissioner Sullivan's Efforts to Modernize Technology at TDI Include Artificial Intelligence Pilot Project
  • FTC: Comments on Proposed Amendments to Safeguards, Privacy Rules Due June 13
  • Big Bank CEOs Are About to Face Angry Federal Lawmakers

Legislative Update

TLTA's legislative priorities are advancing in the Texas House and Senate. Both chambers held hearings on the TTIGA update bill (HB 1614/SB 2333), and the House committee recommended it for their local/uncontested calendar.
 
Likewise, the RON-related 'papering out' legislation we support (HB 3060/SB 2128) was heard in the Senate and recommended for their local/uncontested calendar. We expect the Senate bill to go to the floor rather than the local calendar, however, so it can be amended. 
 
Legislation related to certificates of authority that identify who has the authority on behalf of partnerships and corporations to sell real property (HB 1833/SB 977) was heard in the House Business and Industry Committee, and we will be working to have a hearing soon in the Senate.
 
The fact that each of TLTA's priorities are moving via identical companion bills in both chambers is an advantage. The existence of identical companion bills gives us room to maneuver as we encounter the legislative pitfalls that commonly hobble legislation before passage. For example, the rules governing the legislative process provide potential procedural advantage to identical companion bills when they pass each other en route from one chamber to the other. 
 
We continue engaging in productive dialogue with stakeholders and the authors of bills that cause concern for our industry or our strategic partners.
 
We are monitoring the progress of these 77 bills
 
On Thursday of this week, HB 2, which would cap city and county property tax growth, will be heard on the House floor. Elsewhere in the Texas Legislature, the National Federation of Independent Business and other legislative allies are working with the Texas Legislature to preempt cities that require private sector employers to offer paid sick leave, as the City of Austin has done.  
 
Only 47 days remain until the Texas Legislature's 86th Session adjourns Sine Die. 

Texas Senate Passes Two-Year Budget With Money for Property Tax Cuts — But No Plan for How to Spend It

Texas Tribune | April 9, 2019
The Texas Senate on Tuesday approved a two-year, $248 billion spending plan that includes $2.7 billion for a nebulous goal of property tax “relief” — but with seven weeks left in the 2019 legislative session, the upper chamber has yet to rally behind a way to spend those funds.

The Senate budget also includes a $6.3 billion boost for public schools — about $4 billion of which would increase teachers’ and librarians’ annual salaries by $5,000, with $2.3 billion set aside for unspecified aid to school districts. And it orders the Texas Health and Human Services Commission to cut Medicaid expenses by nearly $1 billion, without identifying a way of doing so.
 
“We must take action this session to provide meaningful, lasting property tax relief,” said state Sen. Jane Nelson, a Flower Mound Republican and the Senate’s lead budget writer.

The $2.7 billion in state funds set aside to pay for local property tax cuts “will conform to whatever solution for tax relief is agreed to this session,” she said.
 
Read More »


Commissioner Sullivan's Efforts to Modernize Technology at TDI Include Artificial Intelligence Pilot Project

Texas Department of Insurance | April 9, 2019
There’s more to artificial intelligence than the algorithms that make Siri, Facebook, and Amazon work. It holds the potential to instantly scan and compare mountains of data. That’s why the Texas Department of Insurance (TDI) is testing its use to review insurance policies.

“Imagine being able to instantly compare every policy we’ve reviewed over several years to see what language we’ve approved or denied,” said Insurance Commissioner Kent Sullivan. “This could be a game-changer in terms of helping us protect consumers and ensure regulatory consistency.”

The artificial intelligence pilot is one of the latest projects in Sullivan’s efforts to improve the agency by building on best practices, modernizing technology, and focusing on clear communication.
 
Read More »
 

FTC: Comments on Proposed Amendments to Safeguards and Privacy Rules Due June 13

Federal Trade Commission | March 5, 2019
The Federal Trade Commission is seeking comment on proposed amendments to two rules that protect the privacy and security of customer information held by financial institutions.

In notices published in the Federal Register, the FTC is seeking comment on proposed changes to the Safeguards Rule and the Privacy Rule under the Gramm-Leach-Bliley Act. The Safeguards Rule, which went into effect in 2003, requires a financial institution to develop, implement, and maintain a comprehensive information security program. The Privacy Rule, which went into effect in 2000, requires a financial institution to inform customers about its information-sharing practices and allow customers to opt out of having their information shared with certain third parties.

“We are proposing to amend our data security rules for financial institutions to better protect consumers and provide more certainty for business,” said Andrew Smith, Director of the FTC’s Bureau of Consumer Protection. “While our original groundbreaking Safeguards Rule from 2003 has served consumers well, the proposed changes are informed by the FTC’s almost 20 years of enforcement experience. It also shows that, where we have rulemaking authority, we will exercise it as necessary to keep up with marketplace trends and respond to technological developments.”
 
Read More »
 
EDITORS NOTE: TLTA's Federal Legislative Counsel, James Hyland, is tracking this process for us in D.C. If you have questions about the development of these proposed amendments, please email us, and we'll work with James to find an answer. 

Big Bank CEOs Are About to Face Angry Federal Lawmakers

Los Angeles Times | April 9, 2019
There’s a joke going around Washington about the best strategy for the Wall Street chief executives when they face off with lawmakers today: Stay calm and let Jamie Dimon take over.

Unlike the rest of the bank leaders slated to testify before the House Financial Services Committee, the JPMorgan Chase & Co. boss has been in the congressional hot seat many times before. And rival executives point out, he has a tendency to dominate the conversation anyway.
Today’s hearing has consumed big banks’ lobbying and public relations operations for weeks. The banks have compiled thick briefing binders on issues such as small-business lending and minority hiring, readied responses to pointed questions about pay and inequality, and conducted “murder boards” — practice sessions in which CEOs are cross-examined by a team pretending to be hostile members of Congress.

Despite the extensive preparations, few predict that the executives will come out unscathed. An anti-Wall Street sentiment runs through the Democrats now in control of the financial services panel, particularly among a group of newly elected progressives who are pulling the party to the left.

A case in point is Rep. Alexandria Ocasio-Cortez (D-N.Y.). She and her staff have refused to meet with the bank CEOs’ main trade group ahead of the hearing, according to people familiar with the matter.

“Bulletproof vests covered with fire-retardant suits may not protect the banks,” Jonice Gray Tucker, a partner at the Buckley law firm in Washington, warned a group of bankers at a conference last week. “It’s just a question, unfortunately, of how much scrutiny and how bad it is.”

More important than who gets scorched, however, is whether today’s hearing turns out to be a preview of the intense political heat that Wall Street could face throughout the 2020 presidential campaign. With critics such as Sens. Elizabeth Warren and Bernie Sanders seeking the Democratic nomination, the industry fears months of bad publicity and calls for big banks to be broken up.

Banks have been eager for Washington to turn the page on the 2008 financial crisis and instead focus on more recent business scandals, including those involving Facebook Inc. and other technology giants. They’d like to set a fresh narrative that highlights their post-crisis guardrails and the trillions of dollars they pump into the economy.
 
Read More »

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