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2016 SESSION

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Senate Committee on Commerce and Labor

Chairman: Frank W. Wagner

Clerk: John Garrett
Staff: Frank Munyan
Date of Meeting: February 22, 2016
Time and Place: 15 minutes after Adjournment Senate Room B

H.B. 18 Franchisees; status thereof and its employees as employees of the franchisor.

Patron: Head

Employees; franchisees excluded. Clarifies that neither a franchisee nor any employee of the franchisee shall be deemed to be an employee of the franchisee's franchisor for any purpose, notwithstanding any voluntary agreement between the U.S. Department of Labor and the franchisee.

A BILL to amend and reenact § 40.1-2 of the Code of Virginia, relating to the status of a franchisee and its employees as employees of the franchisor.

16100032D

H.B. 44 Workers' compensation; injuries or deaths presumed to be in course of employment.

Patron: Habeeb

Workers' compensation; injuries presumed to be in course of employment. Establishes presumptions in claims under the Virginia Workers' Compensation Act that the accident arose out of and in the course of employment if (i) the employee dies with there being no evidence that he ever regained consciousness after the accident, (ii) dies at the accident location or nearby, or (iii) is found dead where he is reasonably expected to be as an employee. These presumptions will exist in the absence of a preponderance of evidence to the contrary and where the factual circumstances are of sufficient strength from which the only rational inference to be drawn is that the accident arose out of and in the course of employment.

A BILL to amend and reenact § 65.2-105 of the Code of Virginia, relating to workers' compensation; presumption; injuries in course of employment.

16105123D

H.B. 52 Structured Settlement Protection Act; amends Act so obligor and issuer may rely on court order.

Patron: Kilgore

Structured settlements. Amends the Structured Settlement Protection Act (the Act) to provide that the structured settlement obligor and the annuity issuer may rely on a court order approving a transfer of structured settlement payment rights in redirecting periodic payments to an assignee or transferee in accordance with the order. The measure provides that upon entry of such an order the structured settlement obligor and the annuity issuer shall be discharged and released from any and all liability for the transferred redirected payments as to all parties except the transferee or an assignee designated by the transferee. The discharge and release of the structured settlement obligor and the annuity issuer shall not be affected by the failure of any party to the transfer to comply with the Act or with the court order approving the transfer. The measure also provides that an application for approval of a structured settlement transfer shall be brought in the circuit court of the county in which the payee is domiciled at the time the transfer agreement was signed or, if the payee is not domiciled in Virginia, then the application may be brought in the court in Virginia that approved the structured settlement agreement. The payee is required to appear in person at the hearing unless the court finds that good cause exists to excuse such an appearance. The measure also provides that a court may hear an application for transfer of payment rights under a structured settlement despite the existence of terms in the underlying structured settlement agreement that purports to restrict or preclude the payee's right or power to sell, assign, or encumber structured settlement payment rights. An application for approval of a transfer is required to include a summary of information regarding prior transfers and notice of the hearing. The period in which responses to the application must be filed with the court is changed from not less than 15 days after service of the notice to five days prior to the hearing. Existing provisions that provide for approval of a transfer of structured settlement payment rights by a responsible administrative authority are deleted from the Act.

A BILL to amend and reenact §§ 59.1-475 through 59.1-477.1 of the Code of Virginia, relating to the Structured Settlement Protection Act.

16103459D

H.B. 123 Real estate loans; disclosure of terms of mortgage application.

Patron: Marshall, D.W.

Mortgage loan applications. Deletes the requirement that a residential mortgage lender's or broker's disclosure statement state that all the loan terms not legally locked in are subject to change until settlement and qualifies the requirement to describe when the interest, points, and fees will be locked in to those loans for which such terms will be locked in. The measure will conform disclosure statement requirements to a federal rule that, effective October 3, 2015, requires that closing disclosures that reflect the actual loan terms be provided to the consumer no later than three business days before consummation of the loan.

A BILL to amend and reenact § 6.2-406 of the Code of Virginia, relating to real estate loans; mortgage applications.

16101534D

H.B. 124 Mortgage lenders and mortgage brokers; licenses, reports.

Patron: Marshall, D.W.

Mortgage lenders and mortgage brokers; licenses; reports. Provides that mortgage company and branch licenses issued by the State Corporation Commission expire at the end of each calendar year, unless renewed. The measure provides a process for license renewals and the reinstatement of a mortgage lender or mortgage broker whose license has expired. The measure also replaces the annual reporting requirement with a requirement that licensees file periodic reports with the Commissioner of Financial Institutions or the Nationwide Mortgage Licensing System and Registry.

A BILL to amend and reenact §§ 6.2-1607 and 6.2-1610 of the Code of Virginia, relating to mortgage lenders and mortgage brokers; licenses and reports.

16101540D

H.B. 125 Mortgage loan originators; inactive licenses.

Patron: Marshall, D.W.

Mortgage loan originators; inactive licenses. Authorizes the State Corporation Commission (SCC) to issue an inactive mortgage loan originator license to an individual who has satisfied all requirements for licensure except those pertaining to his surety bond. Similarly, the measure authorizes the SCC to renew, on an inactive basis, the mortgage loan originator license of an individual who has satisfied all requirements for license renewal except those pertaining to his surety bond. A licensee with an inactive license is prohibited from engaging in the business of a mortgage loan originator until the SCC determines that the bonding requirements have been satisfied and has updated his status in the Nationwide Mortgage Licensing System ad Registry.

A BILL to amend the Code of Virginia by adding a section numbered 6.2-1712.1, relating to mortgage loan originators; inactive licenses.

16101954D

H.B. 234 Nonstock corporations; action without board of directors meeting.

Patron: Sullivan

Corporate action without board meeting. Establishes a procedure by which actions of the board of directors of a nonstock corporation may be taken without a meeting by fewer than all of the directors if authorized in the articles of incorporation. Such action without a meeting of the board requires the consent of a majority or quorum of the members of the board. Action under this procedure by fewer than all of the directors requires the corporation to give written notice of the proposed corporate action to all directors. Such action is not permitted if any director objects to the taking of such proposed action within 10 business days after notice of the proposed action is given.

A BILL to amend and reenact § 13.1-865 of the Code of Virginia, relating to nonstock corporations; action without board of directors meeting.

16104556D

H.B. 283 Electrical transmission line siting; hearing requested by locality.

Patron: Minchew

Electrical transmission line siting; hearing requested by locality. Requires the State Corporation Commission (SCC) to hold at least one hearing in the area that would be affected by construction of an electrical transmission line of 138 kV or more, upon the request of the governing body of any county or municipality through which the line is proposed to be built. Currently the SCC is required to conduct a hearing in the affected area if requested by 20 or more interested parties. The measure also provides that the affected localities are given the same protections whenever a significantly different route is deemed desirable by the SCC.

A BILL to amend and reenact § 56-46.1 of the Code of Virginia, relating to State Corporation Commission; approval of electrical transmission lines; hearing.

16102893D

H.B. 324 Insurance rates; authority of an insurer to limit decreases.

Patron: Kilgore

Insurance rates; authority to limit decreases. Authorizes an insurer to file rate or supplementary rate information for its renewal polices that permits the insurer to limit any rate decrease that would otherwise be applicable to the policies, provided that the insurer is also limiting any rate increase that would otherwise be applicable. The provision does not apply to workers' compensation or employers' liability insurance. The bill has a delayed effective date of September 1, 2016.

A BILL to amend and reenact § 38.2-1906 of the Code of Virginia, relating to insurance rates; decreases.

16104520D

H.B. 378 Workers' compensation; fee schedules for medical and legal services.

Patron: Farrell

Workers' compensation; fee schedules for medical services. Directs the Workers' Compensation Commission (the Commission) to adopt regulations establishing fee schedules setting the maximum pecuniary liability of the employer for medical services provided to an injured person pursuant to the Virginia Workers' Compensation Act, in the absence of a contract under which the provider has agreed to accept a specified amount for the medical service. The regulations implementing the fee schedules shall become effective on January 1, 2018. The initial fee schedules will set amounts based on a reimbursement objective, which is the average of all amounts paid to providers in the same category of providers for the medical service in the same medical community. The Commission is required to retain a firm to assist it in establishing the initial fee schedules. The firm will recommend a methodology that will provide statistically valid estimates of the reimbursement objective for fee scheduled medical services within the medical communities. Reimbursements for medical services provided to treat traumatic injuries and serious burns are excluded from the fee schedules and liability for their treatment costs will be based, absent a contract, on 80 percent of the provider's charges. However, the required reimbursement will be 100 percent of the provider's charges if the employer unsuccessfully contests the compensability of the claim. The Commission is required to review and revise the fee schedules in the year after they become effective and biennially thereafter. The liability of the employer for certain medical services not included in a fee schedule will be set by the Commission. A stop-loss feature allows hospitals to receive payments or reimbursements that exceed the fee schedule amount for certain claims when the total charges exceed a charge outlier threshold, which initially is 150 percent of the maximum fee for the service set forth in the applicable fee schedule. Providers are prohibited from using a different charge master or schedule of fees for any medical service provided for workers' compensation patients than the provider uses for health care services provided to patients who are not claimants. The measure requires the Commission, when determining whether the employee's attorney's work with regard to a contested claim resulted in an award of benefits that inure to the benefit of a third-party insurance carrier or health care provider, and in determining the reasonableness of the amount of any fee awarded to an attorney, to consider only the amount paid by the employer or insurance carrier to the third-party insurance carrier or health care provider for medical services rendered to the employee through a certain date and not to consider additional amounts previously paid to a health care provider or reimbursed to a third-party insurance carrier. The Commission shall have an independent, peer-reviewed study conducted every two years. The regulations setting fee schedules are exempt from the Administrative Process Act if the Commission utilizes a regulatory advisory panel to assist in the development of such regulations and provides an opportunity for public comment on the regulations prior to adoption. The measure prohibits certain practices involving the use by third parties of contracts whereby a provider agrees to accept payment of less than the fee scheduled amount, including restricting the sale, lease, or other dissemination of information regarding the payment amounts or terms of a provider contract without the express written consent and prior notification of all parties to the provider contract and prohibiting an employer from shopping for the lowest discount for a specific provider among the provider contracts held in multiple PPO networks. The regulatory advisory panel is directed to make recommendations to the Commission prior to July 1, 2017, on workers' compensation issues relating to (i) pharmaceutical costs not previously included in the fee schedules; (ii) durable medical equipment costs not previously included in the fee schedules; (iii) certain awards of attorney fees; (iv) peer review of medical costs; (v) prior authorization for medical services; and (vi) other issues that the Commission assigns to it. The existing peer review provisions are repealed. The measure has an emergency clause.

A BILL to amend and reenact §§ 2.2-4006, 65.2-605, 65.2-605.1, and 65.2-714 of the Code of Virginia; to amend the Code of Virginia by adding sections numbered 65.2-605.2 and 65.2-821.1; and to repeal Chapter 13 (§§ 65.2-1300 through 65.2-1310) of Title 65.2 of the Code of Virginia, relating to workers' compensation; fees for medical and legal services.

16100358D

EMERGENCY

H.B. 444 Electric utilities; notice of renewable power options.

Patron: Loupassi

Notice to customers of renewable electric power options. Requires the State Corporation Commission (SCC) to post on its website the names, telephone numbers, and available hyperlinks of suppliers of electric energy licensed to sell retail electric energy pursuant to a specific program. The measure applies to those suppliers that (i) expressly state in their applications for licensure, or for any renewal thereof, that they offer electric energy supplied from renewable energy to retail customers and (ii) request in any such applications that they be identified on the SCC's website as making such offers. The measure also requires each investor-owned electric utility to include at least once each calendar quarter in customer bills a notice directing them to the SCC's website.

A BILL to amend and reenact § 56-245.1:2 of the Code of Virginia, relating to electric utilities; notice of renewable power options.

16105376D

H.B. 611 Water and sewer utilities; regulation.

Patron: Bell, Robert B.

Regulation of water and sewer utilities. Makes water and sewer companies subject to the rules of the State Corporation Commission (SCC) regarding meetings and communications between SCC commissioners and any party, or between commissioners and staff, concerning any fact or issue arising out of a proceeding involving the regulation of rates, charges, services, or facilities of a utility. The bill requires a public utility to send notice of a proposed rate increase electronically to customers who receive bills electronically. Water or sewer utilities are required to publish notice of changes in rates, tolls, charges, rules and regulations at least once in one or more newspapers in circulation in its franchise area. The measure bars the SCC from dispensing with notice requirements applicable to water and sewer companies.

A BILL to amend and reenact §§ 12.1-30.1 and 56-237.1 of the Code of Virginia, relating to the regulation of water and sewer utilities.

16105081D

H.B. 691 Workplace safety; employer reporting requirements for work-related incidents.

Patron: Carr

Workplace safety; employer reporting requirements. Extends from eight to 24 hours the time period in which an employer is required to notify the Virginia Department of Labor and Industry of any work-related incident resulting in hospitalization, amputation, or loss of an eye.

A BILL to amend and reenact § 40.1-51.1 of the Code of Virginia, relating to reporting requirements for work-related hospitalization, amputation, or loss of an eye.

16100453D

H.B. 756 E-911 Services Board; designating as 9-1-1 Services Board, powers and duties.

Patron: Lingamfelter

E-1-1 Services Board. Designates the E-911 Services Board as the 9-1-1 Services Board (board). The powers and duties of the Board are revised to authorize and direct it to (i) support and assist public safety answering points (PSAPs) in the provision of 9-1-1 operations and services; (ii) plan, promote, and assist in the statewide development, deployment, and maintenance of an emergency services IP network to support future 9-1-1 and other public safety applications and technologies; and (iii) consult and coordinate with other entities. An "emergency services IP network," among other things, provides an IP transport infrastructure that supports next generation 9-1-1 service core functions. "Next generation 9-1-1 service" is defined as a service that automatically directs 9-1-1 emergency telephone calls and other emergency service requests in data formats to the appropriate PSAPs by routing using geographical information system data. The measure expands the 9-1-1 Services Board to include a member representing VoIP service providers affiliated with cable companies. The measure also requires the 9-1-1 Services Board to develop or adopt and publish standards for an emergency services IP network and core next generation 9-1-1 services on that network to ensure that enhanced public safety telephone services seamlessly interoperate within the Commonwealth and with surrounding states.

A BILL to amend and reenact §§ 2.2-225, 2.2-2031, 56-484.12, 56-484.13, and 56-484.14 of the Code of Virginia, relating to enhanced public safety telephone services; E-911 Services Board renamed the 9-1-1 Services Board.

16104961D

H.B. 844 Insurance agents; continuing education program changes.

Patron: Miller

Insurance agents; continuing education program. Allows insurance agents who have completed all continuing education course or exemption requirements by December 31 but have failed to demonstrate proof of compliance by failing to pay the filing fee to pay the filing fee for an additional period of time, until the close of business on January 31, or the next working day thereafter if January 31 falls on a weekend, of the following year, but only if the agent pays, in addition to the filing fee, a late filing penalty of $100. An agent whose proof of compliance is received during this final period shall not be considered in compliance with the continuing education requirements unless the filing fee and the late filing penalty described herein are paid by the close of business on January 31, or the next working day thereafter if January 31 falls on a weekend. The measure also (i) removes the restriction that the Insurance Continuing Education Board's waiver of requirements pertaining to the number of course credits required for good cause be based on emergency situations and (ii) deletes the condition that requests for waivers of course credit requirements be submitted no later than 90 calendar days prior to the end of the biennium for which the waiver is requested.

A BILL to amend and reenact §§ 38.2-1868.1, 38.2-1869, and 38.2-1870 of the Code of Virginia, relating to insurance agents; continuing education program changes.

16104053D

H.B. 870 Unfair claim settlement practices; appraisal of automobile repair costs.

Patron: Hugo

Unfair claim settlement practices; appraisal of automobile repair costs. Authorizes the repair facility or the insurer making the appraisal of the cost of repairing a motor vehicle that has been damaged as the result of a covered loss to prepare an initial repair appraisal, which may be the final repair appraisal, on the motor vehicle either from personal inspection of the vehicle by a representative of the repair facility or insurer or from photographs, videos, or electronically transmitted digital imagery of the motor vehicle. The measure prohibits an insurer from requiring an owner of a motor vehicle to submit photographs, videos, or electronically transmitted digital imagery as a condition of an appraisal. Supplemental repair estimates that become necessary after the repair work has been initiated due to discovery of additional damage to the motor vehicle may also be made from photographs, videos, or electronically transmitted digital imagery of the motor vehicle, provided that in the case of disputed repairs a personal inspection is required. Currently, a person is prohibited from making appraisals of the cost of repairing a motor vehicle that has been damaged as a result of a collision unless the appraisal is based upon a personal inspection. An insurer's violation of the requirement with such frequency as to indicate a general business practice constitutes an unfair claim settlement practice.

A BILL to amend and reenact § 38.2-510 of the Code of Virginia, relating to unfair claim settlement practices; appraisal of automobile repair costs.

16104775D

H.B. 874 Credit unions; voluntary mergers.

Patron: Habeeb

Credit unions; voluntary mergers. Authorizes the State Corporation Commission (SCC), notwithstanding field of membership requirements, to approve a merger of two Virginia state-chartered credit unions if (i) at least one of the merging credits unions has fewer than 15,000 active members and (ii) neither of the merging credit unions has been a party to a merger pursuant to this exemption within the preceding 24 months. The field of membership of the surviving credit union may be composed of a combination of the fields of membership of the merging credit unions.

A BILL to amend and reenact § 6.2-1344 of the Code of Virginia, relating to credit unions; voluntary mergers.

16105488D

H.B. 918 Limited liability companies; members provided access as an electronic record on a network, etc.

Patron: Mason

Limited liability companies; access to records. Authorizes limited liability companies to provide members with access to the limited liability company's records by electronic means as an electronic record on a network or system. Currently, a limited liability company is required to keep the records at its principal office.

A BILL to amend and reenact § 13.1-1028 of the Code of Virginia, relating to limited liability companies; recordkeeping.

16101173D

H.B. 955 Limited liability companies; entity conversions.

Patron: Keam

Limited liability companies; entity conversions. Restructures the Virginia Limited Liability Company Act (Act) to locate into a new article all existing provisions related to the formation of a limited liability company (LLC) by entity conversion. In addition, the measure brings the current business entity conversion provisions in the Virginia Business Trust Act into alignment with the entity conversion provisions of the Act as restructured in this measure. The measure also provides for the reorganization of an LLC in bankruptcy, as is provided for Virginia stock and nonstock corporations. The measure makes technical adjustments to the Act to bring it in conformance with similar provisions applicable to other business entities.

A BILL to amend and reenact §§ 13.1-603, 13.1-722.8 through 13.1-722.14, 13.1-944.2, 13.1-944.3, 13.1-944.5, 13.1-944.6, 13.1-944.7, 13.1-1002, 13.1-1010, 13.1-1018.1, 13.1-1038.1, 13.1-1052, 13.1-1054, 13.1-1055, 13.1-1056, 13.1-1060, 13.1-1066, 13.1-1070, 13.1-1071, 13.1-1072, 13.1-1076, 13.1-1077, 13.1-1078, 13.1-1080, 13.1-1264, 13.1-1272 through 13.1-1277, 50-73.48:1, 50-73.128, and 56-1 of the Code of Virginia; to amend the Code of Virginia by adding a section numbered 13.1-1003.1, by adding in Article 9 of Chapter 12 of Title 13.1 a section numbered 13.1-1050.5, by adding in Article 13 of Chapter 12 of Title 13.1 sections numbered 13.1-1069.1 and 13.1-1073.1, and by adding in Chapter 12 of Title 13.1 an article numbered 15, consisting of sections numbered 13.1-1081 through 13.1-1087; and to repeal §§ 13.1-1010.1 through 13.1-1010.4 of the Code of Virginia, relating to limited liability companies; entity conversions.

16103571D

H.B. 968 Mortgage lenders and mortgage brokers; posting license.

Patron: Davis

Mortgage lenders and mortgage brokers; posting license. Eliminates the requirement that a licensed mortgage lender or mortgage broker prominently post his license in each office of the licensee. The measure requires such a licensee to display proof of licensing upon request and to prominently display at any location where the licensee conducts business in person with a borrower or prospective borrower the telephone number and website address for the Commission where borrowers and prospective borrowers may confirm the status of his license.

A BILL to amend and reenact § 6.2-1607 of the Code of Virginia, relating to licensed mortgage lenders and brokers; posting license.

16102459D

H.B. 1227 Securities Act; registration exemptions.

Patron: Davis

Securities Act; registration exemptions. Establishes an exemption for any offer or sale of a security that is conducted in accordance with Tier 2 of federal Regulation A promulgated under § 3(b)(2) of the Securities Act of 1933. The exemption applies to the extent such securities are preempted from state registration requirements pursuant to Tier 2 of federal Regulation A. The measure requires the State Corporation Commission (SCC) to prescribe any filings with it of notices, renewals, and other materials. The measure authorizes the SCC to assess a filing fee. The SCC is further required to provide information on its website regarding the differences between this exemption and the crowdfunding exemption enacted in 2015.

A BILL to amend and reenact § 13.1-514 of the Code of Virginia, relating to Securities Act; exemptions from registration requirements.

16103815D

H.B. 1261 State Corporation Commission; interstate gas pipeline safety program.

Patron: Habeeb

State Corporation Commission; interstate gas pipeline safety program. Authorizes the State Corporation Commission (SCC) to seek delegation from the U.S. Secretary of Transportation (the Secretary) of authority to implement the safety inspection provisions of the federal Natural Gas Pipeline Safety Act of 1968. The federal Department of Transportation's Pipeline and Hazardous Materials Administration has jurisdiction over interstate gas pipeline safety programs. If the Secretary agrees, the SCC will be responsible for conducting the program in the Commonwealth. The SCC's authority to conduct safety inspections of interstate gas pipelines will commence the July 1 following the date the SCC receives its delegation of authority from the Secretary.

A BILL to amend the Code of Virginia by adding in Title 56 a chapter numbered 21.1, consisting of sections numbered 56-555.1 and 56-555.2, relating to the authority of the State Corporation Commission to undertake safety activities concerning interstate gas pipeline facilities.

16103336D