SRC-LBB S.B. 1067 78(R)   BILL ANALYSIS


Senate Research Center   S.B. 1067
78R7208 DWS-FBy: Carona
Business & Commerce
5/6/2003
As Filed


DIGEST AND PURPOSE 

Unlike other finance and credit laws in Texas, no state agency has the
authority to interpret the home equity law.  As proposed, S.B. 1067
authorizes the Finance Commission (SFC) to issue interpretations relating
to the home equity lending law.  This bill authorizes the Credit Union
Commission (CUC) to issue interpretations applicable to lenders regulated
by the CUC.  S.B. 1067 also requires SFC and CUC to attempt to adopt
interpretations that are as consistent as feasible or state justification
for any inconsistency. 

RULEMAKING AUTHORITY

This bill does not expressly grant any additional rulemaking authority to
a state officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Subchapter D, Chapter 11, Finance Code, by adding
Section 11.308, as follows: 

Sec.  11.308.  INTERPRETATION OF HOME EQUITY LENDING LAW.  Authorizes the
State Finance Commission (SFC)  to, on request of an interested person or
on its own motion, issue interpretations of Sections 50(a)(5)-(7),
(e)-(p), (t), and (u), Article XVI, Texas Constitution.  Provides that an
interpretation under this section is subject to Chapter 2001, Government
Code, and is applicable to all lenders authorized to make extensions of
credit under Section 50(a)(6), Article XVI, Texas Constitution, except
lenders regulated by the Credit Union Commission (CUC).  Requires SFC and
CUC to attempt to adopt interpretations that are as consistent as feasible
or to state justification for any inconsistency. 

SECTION 2.  Amends Subchapter E, Chapter 15, Finance Code, by adding
Section 15.413, as follows: 

Sec. 15.413.  INTERPRETATION OF HOME EQUITY LENDING LAW.  Authorizes CUC
to, on request of an interested person or on its own motion, issue
interpretations of Sections 50(a)(5)-(7), (e)-(p), (t), and (u), Article
XVI, Texas Constitution.  Provides that an interpretation under this
section is subject to Chapter 2001, Government Code, and is applicable to
lenders regulated by CUC.  Requires SFC and CUC to attempt to adopt
interpretations that are as consistent as feasible or to state
justification for any inconsistency. 

SECTION 3.  Provides that this Act takes effect on the date on which the
constitutional amendment proposed by the 78th Legislature, Regular
Session, 2003, authorizing a home equity line of credit, providing for
administrative interpretation of home equity lending law, and otherwise
relating to the making, refinancing, repayment, and enforcement of home
equity loans takes effect.  Provides that if that amendment is not
approved by the voters, this Act has no effect.