Session of 1999
         
SENATE BILL No. 271
         
By Committee on Financial Institutions and Insurance
          
2-9
          
  9             AN  ACT transferring the duties of the consumer credit commissioner to
10             the state bank commissioner; creating a program of consumer credit
11             affairs within the office of the state bank commissioner; abolishing the
12             office of the consumer credit commissioner; amending K.S.A. 74-3005
13             and 75-1308 and K.S.A. 1998 Supp. 74-3004 and 74-3006 and repeal-
14             ing the existing sections; also repealing K.S.A. 16-403 and 16-609.
15      
16       Be it enacted by the Legislature of the State of Kansas:
17             New Section  1. The office of the consumer credit commissioner cre-
18       ated by K.S.A. 16-403 and amendments thereto is hereby abolished. Ex-
19       cept as otherwise provided in this act, all of the powers, duties and func-
20       tions of the existing consumer credit commissioner are hereby transferred
21       to and conferred and imposed upon the state bank commissioner estab-
22       lished by K.S.A. 75-1304 and amendments thereto.
23             New Sec.  2. (a) The state bank commissioner shall be the successor
24       in every way to the powers, duties and functions of the consumer credit
25       commissioner in which the same were vested prior to the effective date
26       of this act. Every act performed in the exercise of such powers, duties
27       and functions by or under the authority of the state bank commissioner
28       shall be deemed to have the same force and effect as if performed by the
29       consumer credit commissioner in which such powers, duties and func-
30       tions were vested prior to the effective date of this act.
31             (b) Whenever the consumer credit commissioner, or words of like
32       effect, are referred to or designated by a statute, contract or other doc-
33       ument, such reference or designation shall be deemed to apply to the
34       state bank commissioner.
35             (c) All orders and directives of the consumer credit commissioner in
36       existence on the effective date of this act shall continue to be effective
37       and shall be deemed to be orders and directives of the state bank com-
38       missioner until revised, amended or nullified pursuant to law.
39             (d) All rules and regulations of the consumer credit commissioner, in
40       existence on the effective date of this act shall continue to be effective
41       and shall be deemed to be duly adopted rules and regulations of the state
42       bank commissioner until revised, amended, revoked or nullified pursuant
43       to law.

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  1             (e) The state bank commissioner shall succeed to whatever right, title
  2       or interest the consumer credit commissioner has acquired in any real
  3       property in this state, and the state bank commissioner shall hold the
  4       same for and in the name of the state of Kansas.
  5             (f) On and after the effective date of this act, whenever any statute,
  6       contract or other document concerns the power or authority of the con-
  7       sumer credit commissioner, the state bank commissioner shall succeed
  8       to such power or authority.
  9             New Sec.  3. (a) When any conflict arises as to the disposition of any
10       property, power, duty or function or the unexpended balance of any ap-
11       propriation as a result of any abolition, transfer, attachment or change
12       made by or under authority of this act, such conflict shall be resolved by
13       the governor, whose decision shall be final.
14             (b) The Kansas state bank commissioner shall succeed to all property,
15       property rights and records which were used for or pertain to the per-
16       formance of the powers, duties and functions transferred to the bank
17       commissioner. Any conflict as to the proper disposition of property or
18       records arising under this section, and resulting from the transfer, at-
19       tachment or all or part of the powers, duties and functions of the con-
20       sumer credit commissioner, shall be determined by the governor, whose
21       decision shall be final.
22             New Sec.  4. (a) No suit, action or other proceeding, judicial or ad-
23       ministrative, lawfully commenced, or which could have been commenced,
24       by or against any state agency or program mentioned in this act, or by or
25       against any officer of the state in such officer's official capacity or in
26       relation to the discharge of such officer's official duties, shall abate by
27       reason of this act. The court may allow any such suit, action or other
28       proceeding to be maintained by or against the successor of any such state
29       agency or any officer affected.
30             (b) No criminal action commenced or which could have been com-
31       menced by the state shall abate by the taking effect of this act.
32             New Sec.  5. On the effective date of this act, the balances of all funds
33       appropriated or reappropriated for the consumer credit commissioner,
34       are hereby transferred to the state bank commissioner. The director of
35       accounts and reports shall transfer all moneys in the consumer credit fee
36       fund to the bank commissioner fee fund. On the effective date of this
37       act, all liabilities of the consumer credit fee fund existing prior to the
38       effective date of this act are imposed on the bank commissioner fee fund.
39       The consumer credit fee fund is hereby abolished.
40             New Sec.  6. On the effective date of this act, officers and employees
41       who, immediately prior to such date, were engaged in the performance
42       of powers, duties or functions involved in the administration of any law
43       administered by the consumer credit commissioner, and who, in the opin-

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  1       ion of the state bank commissioner, are necessary to perform the powers,
  2       duties and functions involved in the administration of any law adminis-
  3       tered by the consumer credit commissioner, shall be transferred to, and
  4       shall become officers and employees of the bank commissioner. Any such
  5       officer or employee shall retain all retirement benefits and all rights of
  6       civil service which had accrued to or vested in such officer or employee
  7       prior to the effective date of this act. The service of each such officer and
  8       employee so transferred shall be deemed to have been continuous.
  9             New Sec.  7. (a) On the effective date of this act, the balance of all
10       funds appropriated and reappropriated to the consumer credit commis-
11       sioner is hereby transferred to the state bank commissioner and shall be
12       used only for the purpose for which the appropriation was originally
13       made.
14             (b) On the effective date of this act, the liability for all accrued com-
15       pensation or salaries of officers and employees who, immediately prior to
16       such date, were engaged in the performance of powers, duties or func-
17       tions of any state agency or officer transferred by this act, or which be-
18       comes a part of the office of the state bank commissioner or the powers,
19       duties and functions of which are transferred to the bank commissioner,
20       shall be assumed and paid by the state bank commissioner.
21             New Sec.  8. (a) There is hereby established in the office of the bank
22       commissioner a program of banking and trust company regulation to en-
23       force the provisions of chapter 9 of the Kansas Statutes Annotated and
24       amendments thereto or rules and regulations adopted thereunder. The
25       program shall be under the supervision of the state bank commissioner,
26       and the commissioner shall employ a deputy commissioner to administer
27       the program and appoint such personnel as may be necessary for the
28       proper administration of the program. The deputy commissioner shall be
29       in the unclassified service of the Kansas civil service act.
30             (b) The deputy commissioner administering the banking regulation
31       program shall perform all duties and functions delegated by the commis-
32       sioner regarding:
33             (1) The administration and enforcement of chapter 9 of Kansas Stat-
34       utes Annotated and amendments thereto; and
35             (2) such other duties as may be assigned by the commissioner.
36             New Sec.  9. (a) There is hereby established in the office of the bank
37       commissioner a program of consumer credit regulation. The program
38       shall be under the supervision of the state bank commissioner, and the
39       commissioner shall employ a deputy commissioner to administer the pro-
40       gram and appoint such personnel as may be necessary for the proper
41       administration of the program. The deputy commissioner shall have at
42       least five years' experience in an executive position in a consumer credit
43       business regulated by the commissioner or at least five years' experience

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  1       as a state or federal regulator of a consumer credit business regulated by
  2       the commissioner. The deputy commissioner shall be in the unclassified
  3       service of the Kansas civil service act and shall receive an annual salary
  4       fixed by the bank commissioner.
  5             (b) The deputy commissioner administering the consumer credit pro-
  6       gram shall perform all duties and functions delegated by the commis-
  7       sioner regarding:
  8             (1) The regulation of investment certificates of investment companies
  9       as set forth in article 6 of chapter 16 of the Kansas Statutes Annotated as
10       amended and supplemented;
11             (2) the administration of the uniform consumer credit code as set
12       forth in chapter 16a of the Kansas Statutes Annotated as amended and
13       supplemented;
14             (3) the administration of the fair credit reporting act as set forth in
15       article 7 of chapter 50 of the Kansas Statutes Annotated as amended and
16       supplemented;
17             (4) the regulation of credit service organizations as set forth in article
18       11 of chapter 50 of the Kansas Statutes Annotated as amended and
19       supplemented;
20             (5) the regulation of mortgage business as set forth in article 22 of
21       chapter 9 of the Kansas Statutes Annotated as amended and supple-
22       mented; and
23             (6) such other duties as may be assigned by the commissioner.
24             Sec.  10. K.S.A. 1998 Supp. 74-3004 is hereby amended to read as
25       follows: 74-3004. (a) There is hereby created a state banking board which
26       shall be composed of nine members. Six members of the board shall be
27       bankers with not less than five years' actual banking experience in a state
28       bank in this state or persons with not less than five years' actual experience
29       in a state chartered savings and loan association in this state, or any
30       combination thereof and three shall represent the public interest in the
31       regulation, operation and control of state banks and trust companies. All
32       members shall be selected from the state at large. No nonbanker member
33       representing the public interest shall concurrently serve as an officer or
34       director in any state or national bank or trust company wherever located.
35       One of the nine members shall be elected annually The commissioner
36       shall serve as chairperson of the board. The commissioner shall not be a
37       voting member of the board. The board shall be appointed by the gov-
38       ernor. Persons appointed to the board shall be subject to confirmation by
39       the senate as provided in K.S.A. 75-4315b, and amendments thereto.
40       Except as provided by K.S.A. 1998 Supp. 46-2601, no person appointed
41       to the board shall exercise any power, duty or function as a member of
42       the board until confirmed by the senate. No more than five members of
43       the board shall be from the same political party. Subject to the provisions

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  1       of K.S.A. 75-4315c, and amendments thereto, of the six banker or savings
  2       and loan association members, the governor shall appoint one from each
  3       Kansas congressional district as presently constituted and the remainder
  4       from the state at large. Appointment of nonbanker members representing
  5       the public interest shall be made with due consideration for achieving
  6       representation of the various geographic sectors of the state.
  7             (b) Except as provided by subsection (c), terms of members of the
  8       board shall be for three years. Each member shall serve until a successor
  9       is appointed and confirmed. No person shall serve more than two terms
10       as a member of the board. In the event of a vacancy on the board, the
11       governor shall appoint a new member of the same qualification to fill the
12       unexpired term.
13             (c) The terms of members who are serving on the board on the ef-
14       fective date of this act shall expire on March 15, of the year in which such
15       member's term would have expired under the provisions of this section
16       prior to amendment by this act. Thereafter, members shall be appointed
17       for terms of three years and until their successors are appointed and
18       confirmed.
19             New Sec.  11. (a) There is hereby created a state consumer credit
20       advisory board which shall be composed of nine members. Six members
21       of the board shall be persons with not less than five years' actual experi-
22       ence in the operation of a consumer loan or related company or regulation
23       of the consumer loan industry in this state, and three shall represent the
24       public interest in the regulation, operation and control of consumer loan
25       and related companies. All members shall be selected from the state at
26       large. No member representing the public interest shall concurrently
27       serve as an officer or director in any consumer loan or related company
28       wherever located. The commissioner shall serve as chairperson of the
29       board. The chairperson shall be a nonvoting member of the board. The
30       board shall be appointed by the governor. Persons appointed to the board
31       shall be subject to confirmation by the senate as provided in K.S.A. 75-
32       4315b, and amendments thereto. Except as provided by K.S.A. 1998
33       Supp. 46-2601, no person appointed to the board shall exercise any
34       power, duty or function as a member of the board until confirmed by the
35       senate. No more than five members of the board shall be from the same
36       political party. Subject to the provisions of K.S.A. 75-4315c, and amend-
37       ments thereto, of the six persons representing the consumer credit in-
38       dustry, the governor shall appoint one from each Kansas congressional
39       district as presently constituted and the remainder from the state at large.
40       Appointment of members representing the public interest shall be made
41       with due consideration for achieving representation of the various por-
42       tions of the consumer credit industry regulated by the commissioner.
43             (b) Except as provided by subsection (c), terms of members of the

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  1       board shall be for three years. Each member shall serve until a successor
  2       is appointed and confirmed. No person shall serve more than two terms
  3       as a member of the board. In the event of a vacancy on the board, the
  4       governor shall appoint a new member of the same qualification to fill the
  5       unexpired term.
  6             (c) (1)  The governor shall appoint one member representing the
  7       public and two members representing the consumer credit industry for
  8       a term which expires on March 15 of the calendar year which starts after
  9       the effective date of this act.
10             (2) The governor shall appoint one member representing the public
11       and two members representing the consumer credit industry for a term
12       which expires on March 15 of the second calendar year which starts after
13       the effective date of this act.
14             (3) The governor shall appoint one member representing the public
15       and two members representing the consumer credit industry for a term
16       which expires on March 15 of the third calendar year which starts after
17       the effective date of this act.
18             (4) Thereafter, members shall be appointed for terms of three years
19       and until their successors are appointed and confirmed.
20             Sec.  12. K.S.A. 74-3005 is hereby amended to read as follows: 74-
21       3005. Members of the state banking board attending meetings of such
22       board, or attending a subcommittee meeting thereof authorized by such
23       board, shall be paid compensation, subsistence allowances, mileage and
24       other expenses as provided in K.S.A. 75-3223 and amendments thereto.
25       The commissioner shall act as secretary for said board and shall keep a
26       permanent record of all meetings and proceedings of said such board in
27       his the commissioner's office.
28             New Sec.  13. Members of the consumer credit advisory board at-
29       tending meetings of such board, or attending a subcommittee meeting
30       thereof authorized by such board, shall be paid compensation, subsistence
31       allowances, mileage and other expenses as provided in K.S.A. 75-3223
32       and amendments thereto. The commissioner shall keep a permanent rec-
33       ord of all meetings and proceedings of such board in the commissioner's
34       office.
35             Sec.  14. K.S.A. 1998 Supp. 74-3006 is hereby amended to read as
36       follows: 74-3006. (a) The state banking board shall meet once each month
37       quarter, on dates it agrees upon, and shall meet at other times as the
38       board deems necessary or when called by the chairperson or any three
39       members of the board state bank commissioner. Six members of the board
40       shall constitute a quorum, and a majority vote of the board shall be nec-
41       essary to carry any question. No action of the board shall be taken except
42       in a formal meeting and after a favorable vote of a majority of the entire
43       board. The members of the board during business hours shall have free

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  1       access to all of the records in the office of the commissioner. The board
  2       shall act in an advisory capacity in all matters pertaining to the conduct
  3       and welfare of the banking department and the administration of the
  4       banking laws of this state except as otherwise specifically provided by law.
  5             (b) The board, in accordance with K.S.A. 75-4319 and amendments
  6       thereto, may recess for a closed or executive meeting to discuss infor-
  7       mation deemed confidential by virtue of K.S.A. 9-1712 and amendments
  8       thereto.
  9             New Sec.  15. (a) The consumer credit advisory board shall meet
10       once each quarter on dates it agrees upon or when called by the state
11       bank commissioner. Six members of the board shall constitute a quorum,
12       and a majority vote of the board shall be necessary to carry any question.
13       No action of the board shall be taken except in a formal meeting and
14       after a favorable vote of a majority of the entire board. The board shall
15       act in an advisory capacity in all matters pertaining to the administration
16       of the laws of this state pertaining to consumer credit.
17             (b) The board, in accordance with K.S.A. 75-4319 and amendments
18       thereto, may recess for a closed or executive meeting to discuss infor-
19       mation deemed confidential.
20             Sec.  16. K.S.A. 75-1308 is hereby amended to read as follows: 75-
21       1308. The commissioner shall keep a record of all fees collected by him
22       or her the commissioner, together with a record of all expenses incurred
23       in making the examinations of all banks and trust companies. The bank
24       commissioner shall remit all moneys received by or for him or her the
25       commissioner from such fees to the state treasurer at least monthly. Upon
26       receipt of each such remittance, the state treasurer shall deposit the entire
27       amount thereof in the state treasury. Twenty percent (20%) of each such
28       deposit shall be credited to the state general fund and the balance shall
29       be credited to the bank commissioner fee fund. All expenditures from
30       the bank commissioner fee fund shall be made in accordance with ap-
31       propriation acts upon warrants of the director of accounts and reports
32       issued pursuant to vouchers approved by the bank commissioner or by a
33       person or persons designated by him or her the commissioner. 
34       Sec.  17. K.S.A. 16-403, 16-609, 74-3005 and 75-1308 and K.S.A.
35       1998 Supp. 74-3004 and 74-3006 are hereby repealed.
36        Sec.  18. This act shall take effect and be in force from and after its
37       publication in the statute book.