It was no coincidence that this year's lobbying day for the Louisiana Bankers Association, which drew the largest number of participants in recent history, featured a keynote speech from Insurance Commissioner Jim Donelon.
"It's not sexy or all over the news, but this is a very huge issue for us," says David Boneno, general counsel to the Louisiana Bankers Association. "You can't write loans without the insurance, and some companies have already stopped writing policies altogether. This could drive up the cost of transactions for everyone."
The LBA is usually a quiet force in the Legislature, but its fundraising and lobbying tactics have grown more sophisticated. LBA has become the unofficial backbone of the Coalition to Insure Louisiana, a broad group of professional associations and white-collar businesses ' banking, real estate, insurance, accounting, contracting, auto dealerships and more ' whose main mission is to keep insurance available and affordable. LBA's state PAC has almost $53,000 in its coffers, and its PAC for federal lobbying contains almost $37,000.
The insurance bill deemed most detrimental by the LBA to regional economies in the state was Senate Bill 693 by Benton Democratic Sen. Robert Adley. It would have repealed the "flex band" law that was enacted several years ago. The law allows insurance companies to increase or decrease their rates up to 10 percent a year without seeking the approval of the Insurance Rating Commission ' the only state entity in the nation that still oversees rates in such a way.
The flex band provision also forces insurance companies to justify their changes with the state Department of Insurance. The LBA and its coalition were successful in killing the measure but are standing guard for any unexpected surprises in the final weeks of session.
Repealing the flex band law would have sent a terrible signal to any company doing or considering doing business in Louisiana, says Guy Williams, president of Gulf Coast Bank and Trust, which has ATM and branch locations stretching from Acadiana into East Baton Rouge Parish and through the New Orleans region. Williams, who has spent considerable time at the Capitol this session lobbying the issue, also believes any move to strengthen the rating commission or give insurance companies another excuse to leave the state should be considered dead on arrival.
"Louisiana has a backwards way of approaching these things," he says. "It's all anti-competitive. We're letting a group of people who have no interest in the industry make these decisions. I fear the Legislature is moving in the wrong direction."
During the same committee meeting where the LBA killed the flex band bill, the group gutted legislation that would have offered consumers different options in suing insurance companies.
The association is also bitterly fighting to alter House Bill 448 by New Orleans Rep. Charmaine Marchand. HB 448 requires the Office of Financial Institutions to educate the public following another natural disaster on their loan payment options if regulators again encourage forbearance, or later payments. New additions to the bill provide that lenders obtain written approval of the borrower if the entire principal and interest is due after the forbearance period, which was 90 days following the fall hurricane season in most cases.
Loan defaults were a major concern last year, but fears subsided a bit in January when payments came due and deposits into banks started increasing again. "We learned just how resilient the banking industry was and how willing consumers can be," Williams says.
As the current legislative session hits its final stride this month, the LBA is also opposing a set of bills that attempt to keep insurance proceeds resulting from damaged homes from being seized for other debts ' and out of the hands of lenders. On the other end of the spectrum, the group has thrown its support behind legislation that requires insurance agents and brokers to have three hours of continuing education dedicated just to flood insurance.
One of the most significant policy issues still looming is the state's housing plan, which recently received approval from the federal Housing and Urban Development agency. The nod comes with $4.6 billion from HUD's Community Development Block Grant program, but another $4.2 billion is needed from Congress to fully finance the housing plan. In theory, homeowners would use the money to make repairs, rebuild or participate in buyouts.
Previous versions of other housing plans promised bankers and lenders 60 percent of what they were owed, or completely left them out of the process. Under the state's plan, the devil is in the proverbial details, and many in the industry still don't know what they are.
"The banks aren't crying and telling us they are having problems," says Boneno, "but many are waiting to find out about the fine print on many issues, like the recovery plan. These things will need to be clarified before any major decisions about the future can be made."
Thursday's Blogs from the Bog!
Pat Bowlen steps down; typhoon caused Taiwan plane crash; Arizona execution botched and more national and international news for Thursday, July 24, 2014.
Thousands of people who bought health insurance through the marketplace created by the federal health care overhaul face price hikes next year that could top 10 percent.
Louisiana fell one spot in an annual national ranking of child well-being that looks at poverty, education and health access.
A federal judge has decided he doesn't need to hear more arguments in the case of a gay couple who want a Louisiana marriage license.
Saints again bring playoff aspirations into 2014 campaign.
New details in the case against the man arrested for last week’s bomb threat and bank robbery has surfaced, including a MidSouth Bank surveillance video showing the alleged suspect attempt an early-morning bank robbery.
Parents and teachers who support the Common Core education standards sued Gov. Bobby Jindal Tuesday over his actions against the multi-state standards, accusing him of illegally meddling in education policy.
An arrest was announced this morning in connection with last week’s bomb scare at UL Lafayette.
Attorneys, judges and others interviewed by LaPolitics expect 15 to 20 district judge races this year.
"I feel like I'm under siege," an attorney said recently over drinks at Galatoire's Bistro in Baton Rouge. "We all do. Every time I turn around somebody wants a check. District attorney races. The judges. They're killing us."
As a requirement for running for Congress in the 6th District, former Gov. Edwin Edwards has filed his financial disclosure statement with the U.S. House showing his income in 2013 totaling $242,787.
Unlike those swindled by Bernie Madoff, the victims of Texas businessman Robert Allen Stanford’s Ponzi scheme won’t be getting any relief from the Securities Investor Protection Corp.’s emergency fund after a recent appellate court ruling.
The legal challenge is part of a continuing struggle over Common Core, which has become controversial since the Board of Elementary and Secondary Education adopted the standards in 2010.
The lone Democrat to announce he's running for governor, state Rep. John Bel Edwards, criticized Republican Gov. Bobby Jindal's budgeting tactics as "running the state like a big Ponzi scheme."
State police have arrested a 42-year-old Kaplan man in the July 7 hit and run fatality crash that killed a bicyclist on Louisiana Highway 92 near Milton.
Republican U.S. Rep. Bill Cassidy has picked up support for his U.S. Senate campaign from a former GOP competitor.
Lisa Hargis Smith lived a mysterious life as seen with her death earlier this month and its impact on the community of those who knew her, whether as a star student in Lafayette High’s class of ‘69, or later as a woman struggling with homelessness and mental illness.
Attorney Valerie Gotch Garrett will announce on Tuesday that she plans to run for the Division E seat of the 15th Judicial District Court.
Back in 2012, three Baton Rouge attorneys came to the aid of several disgruntled police officers with a high-profile lawsuit against the Lafayette Police chief and a number of higher-ups in city-parish government, but in a federal courtroom Thursday, their claims of conspiracy coupled with a lack of evidence backfired and the case was dismissed.
Gov. Bobby Jindal's administration intends to rework how it pays the private managed care networks that provide health services to two-thirds of Louisiana's Medicaid patients.
Gov. Bobby Jindal's administration is raising health insurance rates and cutting benefits for state employees and retirees, to keep their insurance program solvent.
Local, state and federal law enforcement officials spent much of Thursday reviewing their reaction to this week’s bomb threat, which led to the closure and evacuation of UL Lafayette and Girard Park, and a massive search Wednesday for two alleged explosive devices.
"We're not in a better place from the policy perspective than we were two weeks ago," says Education Superintendent John White, commenting on Thursday's face-to-face meeting with Gov. Bobby Jindal to discuss their dispute over Common Core.
Gov. Bobby Jindal appears to remain unmoved by offers of a compromise on procuring testing materials tied to the Common Core based on a terse statement his office released following a meeting Thursday with Superintendent John White.