From the 86th: Sunset Bills

Recall that the laws in the state of Texas mandate that all state agencies are placed on a “sunset” clock.  Periodically, every state agency must come up for review and are required to go through the sunset process where the legislature determines if the agency should continue to exist, and if so, what statutory modification should be incorporated to the renewed period of agency life.

All three of the following bills were signed into law, and all of them become effective on September 1, 2019.

HB 1442 - Relating to the continuation and functions of the Office of Consumer Credit Commissioner and the licensing and registration of persons regulated by that state agency.

HB 1442 was the “sunset” bill for the OCCC.  Recall that the OCCC regulates all lending in Texas for personal property manufactured housing.  The OCCC was renewed under sunset to continue its existence for 12 more years. The bill also creates the option for the OCCC to choose to create a new advisory committee.  There are changes to the consumer complaint process and new laws on the OCCC’s “alternative dispute resolution process.”

The bill also expands the OCCC regulatory jurisdiction to some forms of online lending.

As it relates to manufactured home lenders, the primary change of this bill was the option to move from a one-year registration to a two-year registration and renewal period.  No other substantive changes were made to Chapter 347, Finance Code, in this bill.

With all sunset processes of state entities that have some regulatory charge or impact on the manufactured housing industry, in particular the bulk of all lending on manufactured homes in this state, TMHA has been active for the past two years with the OCCC’s sunset process.  This work began the year before the legislative session with staff reports, hearings and staff recommendations. 

TMHA is pleased that the work done, and final bill reflect our efforts toward persevering the availability of credit and a competitive lending market for manufactured homes in Texas.

SB 604 - Relating to the continuation and functions of the Texas Department of Motor Vehicles and to the operations of certain other entities performing functions associated with the department.

The DMV agency was renewed until 2031.  The comprehensive “sunset bill” addresses the composition of the DMV board, complaints and rulemaking processes, digital license plates, tilting systems, and various other changes. 

SB 614 - Relating to the continuation and functions of the Finance Commission of Texas, the Texas Department of Banking, and the Department of Savings and Mortgage Lending.

The Banking and SML sunset bill made several changes to generally increase efficiency in operations and implement certain best practices.  But mostly the bill provides for the continuation of both agencies with certain statutory modifications. 

Note that this is significant, in particular for SML, which the Sunset staff originally recommended over the summer to abolish SML completely and have Banking absorb its responsibilities.  However, the members of the sunset commission as well as both bodies of the legislature disagreed with that recommendation, granting renewed life to both agencies and preserving their independence until 2031.