February 7, 2024
Bill Report

Lawmakers are nearing the halfway mark of the 2024 session. The supplemental budget (operating, capital, and transportation) deliberations are still a couple of weeks away, but the Legislature has passed the first and second procedural cutoffs, the deadline for bills to pass out of policy committees in their House of Origin, and the first fiscal cutoff. From now until the end of the session, cutoffs will occur frequently to continue reducing the number of bills under active consideration. 

One rule to remember is that bills deemed "necessary to implement the budget" (NTIB) are exempt from cutoffs, so all revenue-related measures will remain technically alive until adjournment, even if they don't appear to be moving forward. It's one of the legislative process's complications and something our lobbying team is extremely mindful of. 

However, the first cutoff eliminated several bills that we have been tracking, including: 

• HB 1951 would have imposed additional requirements on any entity using artificial intelligence algorithms (broadly defined) in "consequential decisions." 
• HB 2094, HB 2095, and SB 5988 are three bills dealing with administration, regulation, and unclaimed property rules pertaining to consumer gift cards and loyalty programs. HB 2095 could be considered NTIB due to the fiscal nature of the bill, but it is unexpected to move forward.
• SB 5855 and SB 6081, to proposals to require "plain language" in customer agreements and contracts. 
• HB 1885, which would have prohibited "foreign-influenced" corporations -- including virtually any publicly traded corporation -- from making political contributions in the state.
• HB 2149 would have prohibited the sharing or selling consumer data gathered at "the point of sale" unless expressly authorized by the customer. 

In contrast, a few bills that we are watching are moving forward in the process: 

• SB 5838 and HB 1934 are two proposals to create an artificial intelligence task force to examine regulatory oversight of this rapidly evolving technology. The two vary in composition and timelines, so these differences must be resolved before becoming law. Both measures will be up for votes in their respective fiscal committees this week.
• SB 6299 deals with the impact of AI in the workplace and is an attempt to protect existing jobs from being eliminated through AI technologies. Our concern with this bill is that its definition of artificial intelligence is very broad, and nearly any automation or technology might fall under it. The bill has been voted out of the Senate Labor & Commerce Committee and is now in the Rules Committee, the last step before heading to the floor. Feedback to lawmakers from across the business community has been that lawmakers should focus on the task force bills rather than anything substantive. 
• HB 2081/ SB 5968 regarding home equity sharing agreements. Both versions are in their respective Rules Committee. The bills under consideration contain changes made in the two policy committees, which must be resolved. We are generally comfortable with the language in the bills now, but we will keep an eye out to ensure nothing changes. 
• HB 1915 is WBA-supported legislation expanding state financial literacy programs and high school graduation requirements. It has met the policy committee cutoff and has moved on to the Rules Committee. There was also a Senate companion bill, but only the House version is moving ahead. 
• HB 2072, AG request legislation to substantially increase penalties imposed on organizations found to have violated anti-trust laws. The bill has passed out of the policy committee and moved to Rules. 
• SB 5801 regulates special deposits. We are comfortable with the bill's clarifications. It passed the Senate with a strong 47 votes and has moved to the House. 

Finally, as mentioned earlier, all tax proposals are considered NTIB, so they remain alive. Ones we are paying particular attention to, even if they appear dormant, include: 

• SB 5493, this year's version of the proposal to eliminate the B&O tax exemption for interest income on first mortgage loans, remains a top priority. So far, it hasn't received any action, but we have learned over the years not to take anything for granted, so we will continue to watch it closely.
• HB 2276 and SB 6191 would increase the real estate excise tax on transactions over $3.025 million. The proposal is being pitched as a "mansion tax," but it would actually have a greater impact on sales of raw land, apartment buildings, and the already struggling commercial real estate sector. Both bills have had hearings, but neither chamber seems to want to be the first to pass the higher tax. There is a business community opposition coalition, and we are watching their activities.
• SB 5770 would allow local governments to triple the growth rate in their property tax collections from 1% to 3%. It is scheduled for a vote in the Ways & Means Committee this week. This could impact many customers, and we will watch it closely.
• HB 2308 would allow local governments to offer tax incentives for converting excess commercial property into housing or converting multi-family housing to affordable housing. It is scheduled for a vote in the House Appropriations Committee this week.

As the session progresses, we will continue providing you with weekly updates on these and other bills. If you have any questions or your bank is concerned about an issue not mentioned here, please get in touch with us.