BILL ANALYSIS Ó
SENATE BANKING & FINANCIAL INSTITUTIONS COMMITTEE
Senator Noreen Evans, Chair
2013-2014 Regular Session
AB 2298 (Rodriguez) Hearing Date: June 4, 2014
As Introduced: February 21, 2014
Fiscal: Yes
Urgency: No
SUMMARY Would authorize depository institutions to submit
specified weekly reports to the Department of Business Oversight
(DBO) via facsimile or email.
DESCRIPTION
1. Would allow depository institutions that hold local agency
deposits to submit their required weekly reports to DBO
electronically, via facsimile or email.
EXISTING LAW
2. Imposes several requirements on depository institutions
that accept local agency deposits. Among these is a
requirement that each depository institution with local
agency funds on deposit submit a written report to the
Administrator of Local Agency Security of the State of
California on a weekly basis, giving the total amount of all
local agency deposits held by that depository as of the
close of business each Wednesday. These reports must either
be delivered to the office of the Administrator or mailed to
the Administrator, as specified (Government Code Section
53663).
3. Provides that the Commissioner of Business Oversight
(commissioner) shall act as the Administrator of Local
Agency Security and shall be responsible for administering
several Government Code sections, including the code section
that is the subject of this bill (Section 53661).
COMMENTS
1. Purpose: This bill is sponsored by the California Credit
Union League to update an antiquated Government Code section
that does not envision electronic submission of documents.
AB 2298 (Rodriguez), Page 2
2. Background: As summarized above in the description of
existing law, banks and credit unions that accept local
agency deposits are required to report their total local
agency deposit balances to the Commissioner of Business
Oversight on a weekly basis. Under existing law, these must
be paper submissions, which must either be hand-delivered or
mailed to the commissioner. This bill would allow
depository institutions to fax or email these submissions,
if they wish.
3. Discussion: Although DBO does yet not have an official
position on AB 2298, staff of DBO reached out to the author,
expressing concern that fax submissions are insufficiently
secure to warrant their use by banks and credit unions in
this bill's context. DBO is also concerned that the bill
does not allow for use of a secure electronic portal of the
sort the Department is currently developing for use by its
licensees. Amendments suggested below would address DBO's
concerns, while still allowing banks and credit unions to
submit these reports electronically.
4. Summary of Arguments in Support: The California Credit
Union League, sponsor of this bill, is seeking to reduce
unnecessary postage costs and reduce credit unions'
environmental footprint by replacing paper submissions with
electronic submissions. The California Independent Bankers
supports the bill for similar reasons.
5. Summary of Arguments in Opposition: None received.
6. Amendments:
a. Page 2, lines 11 and 12, amend as follows: or
delivered electronically via facsimile or email or other
electronic means approved by the administrator ,
LIST OF REGISTERED SUPPORT/OPPOSITION
Support
California Credit Union League (sponsor)
California Independent Bankers
Opposition
AB 2298 (Rodriguez), Page 3
None received
Consultant: Eileen Newhall (916) 651-4102