Legislature, CBA Remain Busy During Interim

Despite adjourning this year’s regular session in mid-September, the state legislature returned a handful of times from their interim recess to consider unfinished business, including a substantial water reform package, informational hearings on additional residential mortgage lending reforms and hearings on restructuring California’s tax system. 

At CBA, we put the finishing touches on our annual State Legislative Summary, a publication summarizing key legislative issues impacting our industry during the course of the year.  Distributed in mid-November, this year’s Summary contained 117 measures and included multiple Regulatory Compliance Bulletins, advisories on registered warrants and a brief summary of the recommendations made by the Commission on the 21st Century Economy.    

We have also concluded our annual State Government Relations Committee (SGRC) strategic planning session.  This annual planning session allowed us to conduct a year-end review on important initiatives and more importantly identify and strategize on upcoming opportunities and challenges for the year ahead.  With our goals established, we can now focus on implementation.  As the economy continues to sputter and unemployment in California remains historically high, we know that next year will continue to present struggles for the financial services industry.  
    
Prior to the SGRC planning session, we decided to take an inward look by sending a survey to our member bank representatives who serve on CBA policy committees.  We requested feedback on how well the state government relations department delivers services to our member banks and areas that may need sharpening.  We shared the results of this survey with SGRC and based on their input, modifications are being made to streamline, enhance and refine.  Being mindful of the quality of services we provide to our members and the need to be dynamic in an evolving marketplace, we think you will be pleased next year as you see the results take shape.

January promises to be hectic as the legislature returns for the second year of their two-year session.  Measures held over from 2009 will rapidly bump up against deadlines, while legislators will simultaneously introduce thousands of new bills for 2010.  While the bill numbers and the names of legislators authoring those measures may differ, we predict the same fights.  Forensic dissection of residential mortgage lending will persist, heightened scrutiny of non-interest income, such as overdraft protection programs, will resurface, and methods to extract additional revenue from taxpayers will abound.  We expect that the state will experience ongoing budget deficits that will lead to concerns over cash flow once again.
         
Anticipating this possibility, CBA continues to meet with officials from the state controller and state treasurer’s office in an ongoing effort to refine the registered warrants system as a precaution should the state need to issue them in the future.  At a recent meeting, we provided observations and recommendations from this recent experience and requested more frequent information detailing the state’s cash position and available cash management tools.  In addition to requesting greater lead time should registered warrants be issued again, we proposed a collaborative initiative designed to alert and educate elected officials about the impact registered warrants have on California and its citizens. 

With only a few weeks left in 2009, we wish to extend thanks to those members who dedicated hours analyzing the countless legislative proposals and provided us guidance on each.  Recognition is also due to individuals that reinforced our advocacy efforts by contacting their elected representatives and attending grassroots meetings.  As we strive for greater efficiency and precision, we sincerely appreciate those that help us grow and perfect the government relations program.  Through the engagement and support of our members, we stand ready to embrace the year ahead.