September 2008


REGULATORY NEWS

Rate Hearing Moved to SOAH

The Texas Department of Insurance (TDI) held a pre-hearing conference on September 10 and announced the transfer of the Ratemaking portion of the Biennial Rate Hearing to the State Office of Administrative Hearings (SOAH). TDI also announced the transfer of the docket in a letter to the parties. It is unclear when the rate hearing will now be held and we will advise you as soon as the date and time have been set.

Board Takes Positions on Agenda Items

 The Biennial Rule Hearing at TDI is scheduled to begin at 9:30 a.m. on October 2, 2008 in Room 100 of the William P. Hobby, Jr. State Office Building, 333 Guadalupe Street in Austin. All members of the industry are encouraged to attend.

The TLTA board has adopted positions on the agenda items and has also filed amendments on several items. We urge you to review all of these agenda items. Brief descriptions, as well as the full text and TLTA's position can be found on the TLTA's website.

Please contact Aaron Day, Director of Government Affairs at aaron@tlta.com or 512.472.6593, should you have any questions.

October 1 Basic Manual Updates Coming Soon

 Become a Subscriber and Save $$$
The October 1, 2008 effective updates to the Basic Manual regarding changes relating to ICL's will be available for order prior to the effective date and available on the TLTA Web site on October 1. If you are a subscriber to the Basic Manual update service or if you purchased the May 1, 2008 updates, you will receive your October 1 updates in the mail.

If you did not order the May 1, 2008 updates, the easiest and most cost-effective way to update your Basic Manual is to sign up for our annual subscription service. Not only will you save money but you will automatically receive all updates throughout the rest of the year.

Personal Property Title Insurance Updates Now Available (Basic Manual Section VIII)
Order Today!

TLTA has been informed that the previously mentioned motions of hearing which were filed in late July regarding the published rates for personal property title insurance, have been overruled. Therefore, the rates are now effective as of July 2. With this new information, TLTA will proceed with publishing the rates in the Basic Manual Section VIII. If you have already purchased this update, your order will now be processed. If you have not purchased your rate update, please order today to ensure your Section VIII binder is up-to-date.View Section VIII. 

LEGISLATIVE NEWS

TRCC Releases Response to Sunset Staff Report

Press Release: September 8, 2008
During its public meeting last week, the Texas Residential Construction Commission drafted a formal response to a recent Sunset Commission staff report that stated problems exist with the laws that guide the Texas Residential Construction Commission.

"The Texas Residential Construction Commission adamantly disagrees with the Sunset Commission staff recommendation to eliminate builder oversight in Texas. Just because the Commission does not fit that staff's standard and somewhat restricted view of what a regulatory agency should look like does not mean that the regulatory structure is fundamentally flawed," said Commission Chairman Paulo Flores. "If there are flaws with the oversight mechanism, certainly none are irreparable, nor should anything but a reasonable effort be necessary to formulate solutions."
View the entire TRCC press release and response.

Sunset Commission Decides to Keep OPIC as an independent agency

The Sunset Commission voted at their September 24 meeting to adopt all of the staff recommendations regarding the Texas Department of Insurance (TDI) with the exception of the proposal to move the Office of Public Insurance Counsel's (OPIC) function and staff into TDI.
Unfortunately, the staff proposal to require independent financial audits of title agents remains in the adopted recommendations. TLTA previously submitted formal comments to the Sunset Commission stating our concerns regarding that portion of the recommendation. We will continue to work with members of the Commission and the Legislature to voice our concerns and seek an alternative solution.

TLTAPAC UPDATE

At their August 20 meeting, the TLTAPAC Board of Trustees approved bylaws changes and Chairman Bert Massey appointed the following fundraising chair positions:

Special Events – Joey Prohaska
Online Auction – Jan Fisher
Golf Tournament – Chris Phillips

2008 Annual TLTAPAC Online Auction
November 6th - 13th
Now Accepting Auction Item Donations!

The TLTABay Online Auction is a fundraiser benefiting the TLTAPAC. The auction will begin at 8:00 a.m. on Thursday, November 6, 2008 and end at 4:00 p.m. on Thursday, November 13, 2008.

Thanks to our members, the Annual TLTABay Online Auction raised a record amount last year. We need your help to secure auction items and ensure another spectacular year. Suggested donation items include: electronics, gift cards, sporting event tickets, travel vouchers, vacations, spa packages and jewelry.

Pledge a donation or contact Tedrah Hutchins for more information.

Join TLTA's Historic Centennial Club
Give Now Before 2008 is Over!
In celebration of 100 years of making history together, the TLTAPAC has created the Centennial Club.The Club recognizes those who have given $100 or more during our year of celebration, which ends December 2008, so contribute today!

As a Centennial Club member you will be included on a commemorative plaque displayed in the TLTA office and recognized with a special ribbon at TLTA events. Each member's contribution strengthens the voice of TLTA and the title industry. Make your voice heard by contributing today! 

FEDERAL NEWS

RESPA Update 

As you may recall, 244 Members of Congress sent a letter to the HUD Secretary in early August requesting the withdrawal of the proposed RESPA rule. The letter also called for improvements to the coordination efforts with other federal agencies and the development of a more simplified approach. Nearly the entire Texas Delegation, led by Congressman Ruben Hinojosa (D-TX), signed the letter. Despite the letter, HUD chose to forward the rule to the White House Office of Management and Budget (OMB), where it now resides for consideration.

Fortunately, TLTA met with OMB in July and was able to express its deep concerns with the current RESPA proposal. The OMB has 60 days in which to review the rule and determine whether or not HUD should finalize it. During this review period, TLTA will continue to communicate our concerns to OMB and work with the Texas Delegation to find a solution.

The House Financial Services held a hearing on this issue on September 16, 2008. Every major real estate group testifying, including ALTA, opposed the current RESPA proposal. Even consumer groups believe it is complicated and inadequate.TLTA will continue to work on this important issue and keep you posted.

Minerals Issue Coverage Update

The TLTA Minerals Task Force and Board of Directors are continuing to work with all interested parties to reach a consensus on a revised proposal dealing with this issue. As soon as we have something more concrete, we will provide you an update.

Update: FDIC Response to ALTA Letter Addressing Escrow Account Safety in Light of Recent Bank Failures

On September 4, ALTA received a response from FDIC counsel to ALTA's request that FDIC clarify its insurance coverage of deposit accounts related to real estate transactions. ALTA sought clarification of FDIC coverage for good funds deposited in a title agency's escrow account in the event of a bank failure.

FDIC's letter confirmed that any account in a failed bank holding over $100,000 is at risk for uninsured loss and further underscored how important it is that title companies that conduct closings or escrow ensure that their bank is in financially sound and operating well above its regulatory capital requirements. In its letter, FDIC indicated that escrow deposits are covered only up to $100,000 (a limit which was prescribed by Congress and cannot be waived,) that coverage applies only to accounts expressly opened as custodial or escrow accounts, and that the beneficiary of any insured funds lost prior to the closing transaction is the buyer of the property, not the seller. Read the FDIC letter.