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2013 SESSION

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Senate Committee on Commerce and Labor

Chairman: John C. Watkins

Clerk: Maribeth Turner, Cheryl Law
Staff: Frank Munyan
Date of Meeting: January 14, 2013
Time and Place: Monday, 1/2 Hour after Adjournment, Senate Room B

S.B. 735 Limited liability company; charging orders entered against a member.

Patron: Petersen

Charging orders entered against a member of a limited liability company. Entitles judgment creditors to levy upon the membership interest of a judgment debtor when the debtor is a member of a limited liability company that is operating as an instrumentality to defraud creditors.

A BILL to amend and reenact § 13.1-1041.1 of the Code of Virginia, relating to charging orders entered against a member of a limited liability company.

13100543D

S.B. 741 Payday loans; permitted interest.

Patron: Miller

Payday loans; permitted interest. Repeals provisions of the Payday Loan Act that authorize lenders to charge a loan fee or verification fee, thereby limiting permissible charges on payday loans to simple interest at a maximum annual rate of 36 percent.

A BILL to amend and reenact §§ 6.2-1816, 6.2-1817, and 6.2-1818 of the Code of Virginia, relating to charges on payday loans.

13101452D

S.B. 755 Payday lending; repeals provisions authorizing lending in State.

Patron: Locke

Payday lending. Repeals provisions authorizing payday lending in the Commonwealth.

A BILL to amend and reenact §§ 6.2-303, 6.2-312, 6.2-1501, 6.2-2107, 59.1-200, and 59.1-203 of the Code of Virginia and to repeal Chapter 18 (§§ 6.2-1800 through 6.2-1829) of Title 6.2 of the Code of Virginia, relating to payday lending.

13100213D

S.B. 769 Credit unions; limit on authorized investments in certain property, retained earnings.

Patron: Wagner

Credit unions; retained earnings. Increases the maximum amount of a credit union's funds that may be invested in its real estate, office buildings, equipment, and furnishings, without the prior written authorization of the Commissioner of Financial Institutions. The measure sets the maximum amount of such investments at five percent of the total of members' share accounts and retained earnings. Currently, the cap is five percent of only such share accounts. Finally, the measure defines "retained earnings" as undivided earnings, regular reserve, reserve for contingencies, supplemental reserves, reserves for losses, and other appropriations from undivided earnings as designated by management or the Bureau of Financial Institutions.

A BILL to amend and reenact §§ 6.2-1300 and 6.2-1376 of the Code of Virginia, relating to the limit on authorized investments by credit unions in certain property; retained earnings.

13101229D

S.B. 775 Unemployment compensation; noncharging of overpayments, penalty for fraudulent claims.

Patron: Watkins

Unemployment compensation; noncharging of overpayments; penalty for fraudulent claims. Provides that an employer shall not be relieved from a claimant's benefit charges relating to an overpayment of unemployment benefits when (i) the overpayment results from the employer's failure to respond timely or adequately to a request for information and (ii) the employer has established a pattern of failing to respond timely or adequately to such requests. A similar requirement is established for reimbursable employing units. A pattern of failing to respond timely or adequately to such requests exists if an employer fails to respond adequately to a request for information four times in a four-year period. After the first three such failures, the Virginia Employment Commission (VEC) is required to give the employer a notice, and is required to assess a $75 civil penalty for a third failure. The VEC is required to monitor the implementation of this provision and report its findings periodically to the Commission on Unemployment Compensation. The measure also provides that any person who is disqualified for unemployment benefits as a result of a fraudulent act or omission shall be assessed a penalty of 15 percent of the amount of any unemployment benefits received for which he was not entitled. Finally, the measure allows benefit overpayments and penalties to be recovered through offsets and eliminates the provision that makes individuals who have obtained benefits as the result of fraud ineligible for benefits until such benefits have been repaid. The enactment of a noncharging provision and a fraud penalty are required pursuant to the federal Trade Adjustment Assistance Extension Act of 2011. The measure is a recommendation of the Commission on Unemployment Compensation.

A BILL to amend and reenact §§ 60.2-618, as it is currently effective and as it may become effective, and 60.2-619 of the Code of Virginia and to amend the Code of Virginia by adding a section numbered 60.2-528.1 and by adding in Article 6 of Chapter 6 of Title 60.2 a section numbered 60.2-636, relating to unemployment compensation; responsibility of employers for benefit charges; penalty for pattern of failure to respond to requests for information; penalties for fraudulent claims for unemployment compensation benefits.

13100415D

S.B. 776 Virginia New Hire Reporting Center; employer reporting of newly hired employees.

Patron: Watkins

Virginia New Hire Reporting Center; employer reporting of newly hired employees. Expands the obligations of employers to report information about the hiring of employees to the Virginia New Hire Reporting Center. Employers are required to submit information concerning each newly hired employee to the Center within 20 days of the employment of a newly hired employee. The measure defines a newly hired employee as an employee who has not previously been employed by the employer or who was previously employed by the employer but has been separated from such prior employment for at least 60 consecutive days. The enactment of the expanded definition of a newly hired employee is required pursuant to the federal Trade Adjustment Assistance Extension Act of 2011. The measure also clarifies the purposes for which the Division of Child Support Enforcement may use the information. This is a recommendation of the Commission on Unemployment Compensation.

A BILL to amend and reenact §§ 60.2-114 and 63.2-1946 of the Code of Virginia, relating to reporting information regarding newly hired employees to the Virginia New Hire Reporting Center.

13100417D

S.B. 777 Insurance; notice of lapse in coverage for certain life and accident and sickness policies.

Patron: Watkins

Insurance; notice of lapse in coverage. Restates a provision enacted in 1991 that was intended to provide that the requirement that insurers issuing certain life and accident and sickness insurance policies provide notice of lapse for failure to pay the premium does not apply to group policies, contracts, or plans. In addition, the requirement does not apply to individual policies, contracts, or plans if the insurer, health services plan, or health care plan either (i) as a general business practice provides its policy owners, contract owners, or plan owners with written notices of premiums due or (ii) has furnished its policy owner, contract owner, or plan owner with written notice separate from that contained in the policy that the failure to pay premiums in a timely manner will result in a lapse of such policy, contract, or plan. The measure is declarative of existing law.

A BILL to amend and reenact § 38.2-232 of the Code of Virginia, relating to notice of lapse of certain insurance policies.

13100715D

S.B. 778 State Corporation Commission; pro bono legal services.

Patron: Watkins

State Corporation Commission; pro bono legal services. Authorizes members of the State Corporation Commission and its subordinates and employees to engage in the private practice of law on a pro bono public basis with the Commission's approval. Currently, all private practice of law by such persons is prohibited.

A BILL to amend and reenact § 12.1-10 of the Code of Virginia, relating to the State Corporation Commission; pro bono legal services.

13101815D

S.B. 779 Limited liability companies; assignment of interest.

Patron: Watkins

Limited liability companies; assignment of interest. Amends the Virginia Limited Liability Company Act to permit the assignee of an interest in a limited liability company to participate in the management and affairs of the limited liability company, become a member of the limited liability company, receive distributions, and have other rights, if provided in the articles of organization or an operating agreement. The measure overturns the Virginia Supreme Court's finding in Ott v. Monroe that current law precludes such rights being transferred to an assignee.

A BILL to amend and reenact § 13.1-1039 of the Code of Virginia, relating to the assignment of membership interest in a limited liability company.

13101816D

S.B. 780 Accident and sickness insurance, individual; open enrollment program.

Patron: Watkins

Individual accident and sickness insurance; open enrollment program. Repeals the requirement that a health insurer that is, or is successor to, a health services plan provide an open enrollment program for individual accident and sickness contracts. Under the open enrollment program, an individual may purchase a product at any time during the year, with the caveat that the individual serve a 12-month waiting period before services are covered for any preexisting condition. The requirement for such an open enrollment program is inconsistent with guaranteed issue provisions of the federal Patient Protection and Affordable Care Act (ACA) that prohibit waiting periods for coverage for preexisting conditions and that provide for limited open enrollment periods. The measure also eliminates certain provisions that set a tax rate of 0.75 percent on premiums from policies sold under the open enrollment program. The measure will become effective January 1, 2014.

A BILL to amend and reenact §§ 32.1-352, 38.2-508, 38.2-3432.3, as it is currently effective and as it shall become effective, 38.2-3444, 38.2-4229.1, and 58.1-2501 of the Code of Virginia and to repeal § 38.2-4216.1 of the Code of Virginia, as it is currently effective and as it may become effective, relating to individual accident and sickness contracts; open enrollment program.

13101169D

S.B. 789 Employees; equal compensation irrespective of sex.

Patron: McEachin

Equal compensation of employees irrespective of sex. Amends existing law requiring equal pay for equal work irrespective of sex to (i) increase the penalty for a violation from double unpaid wages to triple unpaid wages plus reasonable attorney fees; (ii) prohibit employers from punishing employees for sharing salary information with their coworkers; and (iii) prohibit unequal provision of benefits and privileges.

A BILL to amend and reenact § 40.1-28.6 of the Code of Virginia, relating to the equal compensation of employees irrespective of sex; penalties.

13102413D

S.B. 797 Electric utilities; advanced meters.

Patron: Garrett

Electric utilities; advanced meters. Prohibits any electric utility from installing an advanced meter on a customer's premises or requiring a customer to use any advanced meter unless the customer has requested it. An advanced meter is a meter that is capable of measuring, recording, storing, and reporting usage according to predetermined time criteria and that allows two-way communications suited for demand-response programs. Electric utilities are also required to uninstall an advanced meter at a customer's request; prohibited from giving any meter use data from an advanced meter to any person other than the electric utility; prohibited from shutting off service to a customer based on the amount of electricity the customer uses or the customer not having or using an advanced meter; prohibited from imposing any disincentive on a customer for not agreeing to the installation or use of an advanced meter; prohibited from obtaining data from an advanced meter more than once per month unless requested by a customer; and required to notify customers in writing that the installation and use of an advanced meter is not mandated by state law and is not permitted without the customer's request. The measure also repeals an existing provision that prohibits an investor-owned electric utility participating in an energy efficiency program from connecting advanced metering technology and equipment on the customer's side of the interconnection without the customer's express consent.

A BILL to amend and reenact § 56-576 of the Code of Virginia and to amend the Code of Virginia by adding a section numbered 56-249.8, relating to electric utilities; advanced meters.

13100731D

S.B. 816 Payment of wages to employees; requires employers to maintain and preserve certain records.

Patron: McEachin

Payment of wages to employees. Requires employers to maintain and preserve records regarding the rate of pay, hours worked, earnings due, wages paid, and related matters for each employee. The measure provides a standard for how an employee, in an action to collect unpaid wages, may meet his burden of establishing that he is entitled to the wages. The measure also amends an employee's existing private right of action for unpaid wages by requiring the court to award attorney fees and other costs to a prevailing employee. In such a proceeding, unless the employer shows good faith, the court shall award to the employee three times the amount of unpaid wages. An action for unpaid wages shall be commenced within two years after the action accrued, or within three years if the violation is willful.

A BILL to amend and reenact § 40.1-29 of the Code of Virginia, relating to the payment of wages to employees; recordkeeping requirements and private right of action.

13100819D

S.B. 905 Credit unions, federal; those operating within State to comply with Virginia Small Estate Act.

Patron: Reeves

Credit unions; Virginia Small Estate Act. Provides that federal credit unions operating in the Commonwealth, to the extent allowable under federal law, shall comply with provisions of the Virginia Small Estate Act requiring a person having possession of an asset belonging to a decedent with a value of no more than $50,000 to pay or deliver that asset to the designated successor of the decedent.

A BILL to amend and reenact § 6.2-1367 of the Code of Virginia, relating to credit unions; Virginia Small Estate Act.

13101445D

S.B. 917 Financial institutions; contract provision requiring amendment or waiver to be in writing.

Patron: Stuart

Financial institutions; contract provision requiring amendment or waiver to be in writing. Provides that a court, when considering a provision in a written contract involving a financial institution to the effect that no amendment or waiver of any of its terms will be valid unless the amendment or waiver is in writing, will not give effect to any amendment or waiver unless it is in writing.

A BILL to amend the Code of Virginia by adding in Article 2 of Chapter 1 of Title 6.2 a section numbered 6.2-107, relating to contracts with financial institutions; effect of provision requiring amendment or waiver to be in writing.

13103472D

S.B. 921 Health insurance reform; revises State's laws.

Patron: Watkins

Health insurance reform. Revises Virginia's laws pertaining to the regulation of health insurance and related products in order to be consistent with relevant requirements of the federal Patient Protection and Affordable Care Act (PPACA) that become effective on January 1, 2014. These requirements include addressing premium rate restrictions on health benefit plans providing individual and small group health insurance coverage, prohibiting discrimination based on health status, prohibiting adjustments in the cost of coverage based on genetic information, requiring individual and small group health insurance coverage to include the essential health benefits as required by the PPACA, limiting waiting periods for health plans offering group health insurance coverage to 90 days, providing for participation in clinical trials, and authorizing health carriers to provide for wellness programs. The measure removes provisions relating to the standard and essential health benefits plans because they include coverage for services that may or may not comport with the essential health benefit package, and enforcement of the existing requirement would conflict with the PPACA. Though not specifically required to maintain conformity with federal law, the measure (i) keeps the existing limits for maximum size for a small group at 50 employees until 2016 and (ii) authorizes the State Corporation Commission to establish geographic rating areas. The bill removes the sunsets that were placed in provisions affected by or enacted as a result of the PPACA, including the external review processes. The measure is effective January 1, 2014.

A BILL to amend and reenact §§ 38.2-508.1, 38.2-3406.1, 38.2-3407.12, 38.2-3412.1, 38.2-3412.1:01, 38.2-3417, 38.2-3418.8, 38.2-3430.3, 38.2-3431, 38.2-3432.1, 38.2-3432.2, 38.2-3436, 38.2-3438, 38.2-3439, 38.2-3440, 38.2-3442, 38.2-3444, 38.2-3501, 38.2-3503, 38.2-3520, 38.2-3521.1, 38.2-3522.1, 38.2-3523.4, 38.2-3540.2, 38.2-3551, 38.2-4109, 38.2-4214, 38.2-4306, and 38.2-4319 of the Code of Virginia; to amend the Code of Virginia by adding in Article 6 of Chapter 34 of Title 38.2 sections numbered 38.2-3447 through 38.2-3454; and to repeal § 38.2-3433 of the Code of Virginia, the third enactment of Chapter 788 of the Acts of Assembly of 2011, and the second enactment of Chapter 882 of the Acts of Assembly of 2011, relating to health insurance reform.

13103460D

S.B. 994 Mortgage loan originators; conforms Virginia statutory law to federal regulations.

Patron: Watkins

Mortgage loan originators. Conforms Virginia statutory law to federal regulations implementing the Secure and Fair Enforcement for Mortgage Licensing Act. Changes include (i) expanding the definition of a mortgage loan originator to include an individual who represents to the public that he can or will take an application for, or offer or negotiate the terms of, a residential mortgage loan; (ii) clarifying that when an individual acts as a loan originator in financing the sale of his own residence, he is exempt from licensing requirements; (iii) specifying conditions under which an attorney engaged in mortgage loan origination activities is exempt from licensing requirements; and (iv) defining the term "employee." This bill is a recommendation of the Virginia Housing Commission.

A BILL to amend and reenact §§ 6.2-1700 and 6.2-1701 of the Code of Virginia, relating to mortgage loan originators; licensing.

13103427D

S.B. 1034 Banks; derivative transactions, lending limit.

Patron: Watkins

Banks; derivative transactions. Provides for the treatment of derivative transactions with regard to the requirement that the total obligations of any person to any bank shall at no time exceed 15 percent of the sum of the capital, surplus, and loan loss reserve of a bank. An "obligation" is defined in this measure as including any credit exposure to a person arising from a derivative transaction between the bank and the person. "Derivative transaction" is defined as including any transaction that is a contract, agreement, swap, warrant, note, or option that is based, in whole or in part, on the value of, any interest in, or any quantitative measure or the occurrence of any event relating to, one or more commodities, securities, currencies, interest or other rates, indices, or other assets. The Commission is authorized to adopt regulations to further define the term "derivative transaction" and to set forth the rules for calculating credit exposures arising from derivative transactions.

A BILL to amend and reenact § 6.2-875 of the Code of Virginia, relating to banks; derivative transactions; lending limit.

13101724D

S.B. 1035 Unemployment compensation; collection of overpayments.

Patron: Watkins

Unemployment compensation; collection of overpayments. Provides that any person who has received an overpayment of unemployment benefits under a federal program or a program of any other state is liable to the Virginia Employment Commission for the overpayment. Currently, liability for benefit overpayments extends only to benefits under Title 60.2. The measure also provides that the procedure for collecting overpayments resulting from administrative error does not apply if the overpayment involves benefits under a federal program or a program of any other state. The requirement that the state collect overpayments made under unemployment compensation programs of other states and the federal government is established by § 2103 of the Middle Class Tax Relief and Job Creation Act of 2012. The measure has an emergency clause that provides that it shall apply to weeks beginning after the end of the 2013 regular legislative session. This is a recommendation of the Commission on Unemployment Compensation.

A BILL to amend and reenact § 60.2-633 of the Code of Virginia, relating to the recovery of overpayments of unemployment benefits.

13100440D

EMERGENCY

S.B. 1057 Insurers; Own Risk and Solvency Assessments.

Patron: Watkins

Insurers; Own Risk and Solvency Assessments. Requires insurance companies to maintain a risk management framework to assist with identifying, assessing, monitoring, managing, and reporting on material and relevant risks. As part of this requirement, each nonexempt insurer, or the insurance group to which it is a member, is required regularly to conduct an Own Risk and Solvency Assessment (ORSA). An ORSA is a confidential internal assessment, conducted by an insurer, of the material and relevant risks associated with the insurer's current business plan and the sufficiency of capital resources to support those risks. The measure is based on the ORSA Model Act developed by the National Association of Insurance Commissioners. The measure is effective January 1, 2015.

A BILL to amend the Code of Virginia by adding in Chapter 13 of Title 38.2 an article numbered 5.1, consisting of sections numbered 38.2-1334.3 through 38.2-1334.10, relating to risk management by insurance companies; Own Risk and Solvency Assessments.

13101057D

S.B. 1059 Dental and optometric services plans.

Patron: Wagner

Dental and optometric services plans. Provides that two existing provisions, relating to the payment of interest on accident and sickness claim proceeds and to the use of explanation of benefits forms, that apply to insurance companies will also apply to dental and optometric services plans. The provision relating to interest applies to claim payments made on or after January 1, 2014.

A BILL to amend and reenact § 38.2-4509, as it is currently effective and as it shall become effective, of the Code of Virginia, relating to dental and optometric services plans; applicability of certain provisions.

13101060D