COMMITTEE ON LEGISLATIVE RESEARCH
OVERSIGHT DIVISION
FISCAL NOTE
L.R. No.: 2680-01
Bill No.: SB 880
Subject: Credit and Bankruptcy; Banks and Financial Institutions; Consumer Protection
Type: Original
Date: January 7, 2004
FISCAL SUMMARY
| FUND AFFECTED | FY 2005 | FY 2006 | FY 2007 |
| Total Estimated
Net Effect on General Revenue Fund |
$0 | $0 | $0 |
| FUND AFFECTED | FY 2005 | FY 2006 | FY 2007 |
| Total Estimated
Net Effect on All State Funds |
$0 | $0 | $0 |
Numbers within parentheses: ( ) indicate costs or losses.
This fiscal note contains 3 pages.
| FUND AFFECTED | FY 2005 | FY 2006 | FY 2007 |
| Total Estimated
Net Effect on All Federal Funds |
$0 | $0 | $0 |
| FUND AFFECTED | FY 2005 | FY 2006 | FY 2007 |
| Local Government | $0 | $0 | $0 |
ASSUMPTION
Officials from the Department of Economic Development - Division of Finance (DED-FIN) stated this proposal imposes no new duties, therefore there is no fiscal impact to DED-FIN.
Officials from the Department of Economic Development - Division of Credit Unions indicated their agency may be involved in enforcement of the proposal, but there would be no fiscal impact to their agency.
| FISCAL IMPACT - State Government | FY 2005
(10 Mo.) |
FY 2006 | FY 2007 |
| $0 | $0 | $0 |
| FISCAL IMPACT - Local Government | FY 2005
(10 Mo.) |
FY 2006 | FY 2007 |
| $0 | $0 | $0 |
FISCAL IMPACT - Small Business
No direct fiscal impact to small businesses would be expected as a result of this proposal.
DESCRIPTION
This proposal modifies the maximum penalties a consumer must pay for late payments on certain credit transactions. A lender may charge a late payment of 2% of the minimum payment due or $15, whichever is greater, on a small loan payment which is fifteen days or more in default. A minimum charge of $5 is allowed. Charges assessed by an institution for processing a refused instrument plus a handling fee shall not exceed $5 (reduced from $25).
This proposal also modifies the late charge on retail credit sales. The maximum late charge that can be charged is $5 (reduced from $10) or $2 (reduced from $5) when the monthly installment due is less than $25. In addition, the charges assessed by any institution for processing a refused instrument plus a handling fee may not exceed $5 (reduced from $15).
This legislation is not federally mandated, would not duplicate any other program and would not require additional capital improvements or rental space.
SOURCES OF INFORMATION
Department of Economic Development
Division of Finance
Division of Credit Unions
Mickey Wilson, CPA
Director
January 7, 2004