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National Conference of State Legislatures Communications, Financial Services & Interstate Commerce Committee News from the StatesCommittee UpdateNCSL Spring Forum, Washington, DC, April 19-21, 2007The Communications, Financial Services and Interstate Commerce Committee (CFI) will hold its next meeting April 19-21, 2007 in Washington, D.C. At the Spring Forum, the Committee will address several crucial state-federal policies as well as explore key state issues. Topics include broadband, competition in local telecommunications markets, interchange fees, dual banking systems, title insurance and data security. In addition, Committee members are invited to a tour and briefing at Comcast's head end facility in Alexandria, Virginia on Thursday morning, April 19th. On Thursday evening, the National Cable and Telecommunications Association will host a dinner for Committee members at their offices. For updates to the agenda, see the CFI Committee web page or contact Committee staff, Jo Anne Bourquard, Heather Morton or Neal Osten.New Broadband Partners ProjectBroadband access to the Internet makes possible many services and applications that are increasingly essential, such as improved medical care and a wide range of educational opportunities and resources. The NCSL Foundation for State Legislatures Connecting America project was created in order to inform state legislators and staff about broadband and the various policy options that can facilitate the deployment of broadband throughout the states. The project held its first meetings in 2006 in conjunction with the NCSL Annual Meeting and the NCSL Fall Forum (project handouts and meeting summaries are available here). Additional activities and materials planned for the project include a one-day invitational meeting prior to the 2007 NCSL Annual Meeting in Boston, additional site visits and tours of broadband providers, and an article in NCSL's State Legislatures magazine. The project website incorporates the information and resources gathered throughout the duration of the project. The project is led by former CFI Committee chairs, Hawaii Senator Carol Fukunaga and South Dakota Senator Orv Smidt, and the legislative membership includes CFI Committee officers and members. For more information contact project staff, Pam Greenberg or Bob Boerner.
Financial ServicesFreeze on Industrial Loan Companies ContinuesThe debate over industrial loan companies (ILCs) rages on with many commercial firms actively seeking to enter the banking industry. ILCs are allowed to engage in many of the same activities as banks and other depository institutions that are insured by the Federal Deposit Insurance Corporation (FDIC). And, just like the other depository institutions, ILCs must conform to federal safety and soundness safeguards. What differentiates ILCs from other depository institutions is that ILCs can be owned or controlled by commercial entities, which are not subject to financial regulation, so ILCs are not subject to the same level of supervision as other depository institutions. ILCs are growing; between 1987 and 2006 the assets held by ILCs grew from $3.8 billion to over $155 billion.Responding to concerns about ILCs, the FDIC put in place a moratorium on applications to create new industrial loan companies in 2006. The moratorium was scheduled to end January 31, 2007, but the FDIC recently voted to continue the moratorium limited to applications submitted by commercial companies. The FDIC will begin moving forward on applications from financial companies. "The growth in commercial ownership of ILCs raises public policy concerns," said FDIC Chairman Sheila C. Bair. "The moratorium will provide Congress with an opportunity to address the issue legislatively while the FDIC considers how best to respond to any safety and soundness issues surrounding commercial ownership under existing law." Critics see the growth and expansion of ILCs as a threat to community banking and economic development. ILCs are state-chartered and seven states already permit ILCs to operate. However, several states have looked to ban or limit ILCs. Iowa, Maryland and Virginia passed laws in 2006 that prohibit out-of-state industrial loan companies from establishing branches in these states. Colorado, Maine and Nebraska have introduced similar legislation this year. - Submitted by Heather Morton Interest Rate Cap, Sir!In October 2006, Congress enacted the John Warner National Defense Authorization Act for Fiscal Year 2007 and put in place a 36 percent interest rate cap on loans for military borrowers. This congressional action follows on the heels of action in several state legislatures. In 2004, Georgia enacted disclosure and notice requirements for payday loans made to members of the military. In 2005, Texas and Washington prohibited garnishing military wages and salaries in order to collect on delinquent loans. They also prohibited lenders from contacting the borrower's military supervisors. Kansas and Virginia also limited a lender's collection methods for borrowers in the military. To date, Arizona, California, Kentucky, Virginia and Washington have introduced similar legislation this session.- Submitted by Heather Morton
Internet and Information TechnologyNCSL E-Legislatures Website
- Submitted by Pam Greenberg Keeping Kids Safe—Through Online Safety EducationSocial networking sites like MySpace.com, YouTube.com and hundreds of similar Internet sites have come under fire recently for the potential risk they pose to kids from sexual predators. More than half of all American youths ages 12-17 who are online use social networking sites, according to a new national survey conducted by the Pew Internet & American Life Project.One way that state legislators are responding to concerns about children's safety online is through legislation to encourage or require Internet safety classes in schools. For example, Virginia in 2006 enacted H.B. 58, requiring schools to include a component on Internet safety for students in their curricula. This year, California Assembly Member Lieu introduced A.B. 88, which would require the State Department of Education to develop and maintain Internet safety curriculum guidelines for use by local educational agencies. One recent study indicates that Internet safety education in schools may be effective. Two Maine public schools were part of a study to evaluate the use of the NetSmartz program, an Internet safety educational program created sponsored by the National Center for Missing and Exploited Children (NCMEC). The study found that 54 percent of students in the study initially were unsure or believed it was safe to meet someone in person after they had been chatting with them on the Internet for a long time. After being part of the Netsmartz program, 83 percent said it was not safe to meet someone in person. Similarly, before the program, 25 percent of the students thought it might be safe to put their address on the Internet. After the program, 88 percent said it that would not be safe. Other approaches to protecting children on social networking sites include bills that would: 1) require sex offenders to register their e-mail addresses and instant messaging screen names so they can be blocked from online networking sites (e.g., Virginia H.B. 2749); 2) prohibit sex offenders from accessing these types of sites (e.g., Oklahoma H.B. 1714); and 3) prohibit social networking sites from allowing minors to set up a profile without parental consent (e.g., Georgia S.B. 59). - Submitted by Pam Greenberg
TelecommunicationsBroadband Deployment Measures in the StatesHigh-speed Internet, also known as broadband, may soon be available in all corners of the globe. In the near future, telephone, television, radio and the Internet will likely be delivered to homes through a high-speed Internet connection. However, despite leading the world in broadband subscribers, according to one study, the United States dropped from 17th to 20th place in broadband penetration over the past year, falling behind Sweden, the United Kingdom, and Luxembourg.States are considering a variety of ways to encourage broadband deployment in the United States. So far in 2007, nine states, including Connecticut, Indiana, Kansas, Massachusetts, New Hampshire, New Jersey, New York, Virginia and Washington, have introduced broadband-related legislation. Lawmakers in New Hampshire and New York, for example, introduced bills that create broadband development authorities. Kansas and Washington are considering bills that create a state-wide survey on broadband deployment. And, Connecticut lawmakers introduced a measure that permits municipalities to offer broadband wireless Internet services. - Submitted by Bob Boerner Wi-Fi: Coming to a City Near YouWi-fi, short for “wireless fidelity,” is a technology using a radio frequency to carry Internet signals to laptop computers and hand-held computers. For example, there are approximately 100 wi-fi “hot spots” in Toledo, Ohio including coffee shops, hotels, libraries and restaurants. Although there is often a fee for using wi-fi service in many regions of the country, some businesses also offer free access.In 2004, approximately 12 municipalities were working on municipally owned wi-fi systems. Philadelphia was a pioneer in big city wi-fi systems. By late 2006, 300 municipalities were either building their own system or contracting out with private sector vendors to have a system built. On January 5, 2007, San Francisco announced it had reached an agreement to create a citywide wireless broadband network. Google will provide free service on the network at low transmission speeds and Earthlink and other companies will charge for faster services. The network is to be constructed, owned and operated by Earthlink. And, as of January, the New Jersey counties of Camden and Gloucester are in the planning process of creating a two-county wireless zone. The planned government-sponsored network would be the largest in the Garden State serving more than 800,000 people who live in the area near Philadelphia. - Submitted by Bob Boerner Cable Television Franchise LegislationTo simplify and speed up the process of awarding companies who want to offer cable television service, the Texas Legislature in 2005 approved a cable and video franchise law that permits state issued, rather than city or municipal issued agreements. In 2006, statewide cable television franchise legislation was enacted in California, Indiana, Kansas, New Jersey, North Carolina and South Carolina.In late December, 2006, the Michigan Legislature also passed a cable television franchise law. The Cable and Video Competition Act declares it will remove legal uncertainty with respect to the authority of competitive cable service providers and competitive video service providers. It also declares it will promote competitive entry by all competitive cable service providers and competitive video service providers. Under the new law, the state will provide for state-issued authorization for competitive cable service providers and competitive video service providers to deploy their systems and provide cable service and video service. - Submitted by Bob Boerner Bans on RobocallsAs Election Day drew near last November, many voters complained loudly about the assault of cheaply produced, computer-placed, prerecorded political telephone calls. The calls often annoyed voters, while providing dubious information about candidates or issues. "Robocall" complaints emerged largely because there is no political equivalent of the Federal Trade Commission's "do not call" registry, which prohibits commercial calls to people who sign up with the agency. Congress, which wrote the law creating the registry, decided that it should not apply to campaign calls because lawmakers said restricting them would be a violation of the First Amendment's protection of unfettered political speech.State legislatures in at least 15 states – Arizona, Connecticut, Florida, Georgia, Illinois, Kansas, Maryland, Michigan, Missouri, Oklahoma, Pennsylvania, Rhode Island, Tennessee, Texas and Washington -- are moving to stem the practice, either by banning the use of the machines that make the calls or by expanding state do-not-call lists to include automated political campaign calls. A federal judge in October 2006 upheld the Indiana law after state Attorney General Steve Carter sued a company that made automated calls on behalf of a U.S. House candidate. And, New Hampshire lawmakers passed a law that provides, “No person shall deliver or knowingly cause to be delivered a prerecorded political message to any telephone number on any federal do not call list.” - Submitted by Bob Boerner |
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