THE SURETY & FIDELITY ASSOCIATION OF AMERICA MEMORANDUM

Transcription

1 THE SURETY & FIDELITY ASSOCIATION OF AMERICA MEMORANDUM TO: FROM: RE: Government Affairs Advisory Committee Daniel Wanke Commercial Surety Legislation DATE: September 20, 2011 There are eight states and the District of Columbia in regular session. Forty-two states have adjourned for In addition to our August edition of the SFAA Annual Legislative Reports, SFAA has detailed End of Session reports on the legislation addressed for states that have adjourned. These reports are available on the Government Relations page of the SFAA member access website ( The following report compiles and summarizes commercial surety legislation under consideration in 2011, which SFAA is tracking and addressing, as necessary, with the AIA, the local surety associations and other interested parties. CALIFORNIA Assembly Bill No. 156: Miscellaneous Bond Recent History 08/29/2011 READ THIRD TIME AND AMENDED IN SENATE. AB 156 would revise existing law to require a surety bond or other security in connection with a contract for the sale of a gambling enterprise. The bond would secure the enterprise s outstanding gaming chip liability and it would have to be in an amount sufficient to guarantee the availability of funds for the outstanding chips. As introduced, the bill did not contain this provision, but it was added in an amendment in the Senate. Senate Bill No. 156: Miscellaneous Bond Recent History 08/15/2011 WITHDRAWN FROM SENATE COMMITTEE. RE- REFERRED TO COMMITTEE ON RULES. SB 156 would require a professional sports team benefiting from a public agency s issuance and sale of revenue bonds to post a bond or other undertaking when the revenue bonds are issued. The bond or undertaking would have to be in an amount adequate to ensure that all of the team's obligations under a financial agreement will be satisfied if the professional sports team relocates after the revenue bonds are issued.

2 Senate Bill No. 425: Court Bond Recent History 09/06/2011 TO GOVERNOR. SB 425 would authorize the court to require a bond to be posted to secure personal property in connection with a preliminary injunction filed or receiver appointed to preserve the interests of the personal property during a criminal proceeding. Senate Bill No. 441: Miscellaneous Bond POSITION: Neutral Repeals Law for Reasons Unrelated to Bonding Recent History 09/09/2011 TO GOVERNOR. SB 441 would repeal an existing law concerning fundraising materials in connection with an election in which a bond is required. The bond secures the reimbursement of costs to the county for distributing certain materials for the political parties in connection with the mailing of a sample ballot. Assembly Bill No. 469: Miscellaneous Bond POSITION: Neutral Recent History 09/06/2011 SENATE AMENDMENTS CONCURRED IN. TO ENGROSSING AND ENROLLING. AB 469 would extend the term for which a bond must be maintained by an employer convicted of a wage violation from six months to two years. Current law authorizes the Labor Commissioner to require a surety bond from employers who are convicted of a wage violation and fail to satisfy the judgment. The bond permits the employer to continue its business operations. Senate Bill No. 618: Miscellaneous Bond Recent History 09/16/2011 TO GOVERNOR. SB 618 would authorize cities and counties to require performance bonds or other security in connection with land agreements for photovoltaic solar facilities. The bond would secure the restoration of the land used for the facility to its original condition when the land is no longer used for the facility. If the agreement is terminated due to a notice of non-renewal from the landowner, then the bond would be mandatory. Senate Bill No. 708: License Bond Debt Settlement Providers Addressing Bond Amount Recent History 05/31/2011 READ SECOND TIME AND AMENDED IN SENATE. ORDERED TO THIRD READING. SB 708 would require debt settlement service providers to be licensed and post a $200,000 surety bond conditioned on the licensee s compliance with the law. The bond would secure the payment of any funds owed to persons damaged by the provider s noncompliance with the law or any funds owed to the State for violations. An insurer authorized to do business in the State would have to issue the bond.

3 Assembly Bill No. 1293: Court Bond Recent History 08/25/2011 TO GOVERNOR. SB 1293 would authorize the courts to require a surety bond in connection with elder abuse cases involving fraud and embezzlement to secure the property involved in the case. DISTRICT OF COLUMBIA Legislative Bill No. 222/Legislative Bill No. 136: Uniform Commercial Code POSITION: Neutral Recent History 06/24/2011 PUBLIC HEARING. LB 222/LB 136 would amend D.C.'s adoption of the Uniform Commercial Code to revise the definition of surety to include or any "other secondary obligor." Existing law defines surety as a "guarantor." ILLINOIS Senate Bill No. 1244: License Bond Surplus Line Producers POSITION: Oppose Repeals Bond Requirement Recent History 07/23/2011 PURSUANT TO SENATE RULE 3-9(B) / REFERRED TO ASSIGNMENTS. SB 1244 would repeal the surety bond requirement for surplus lines insurance producers. Current law requires a $20,000 surety bond. Senate Bill No. 1539: License Bond Real Estate Appraisal Management Companies Recent History 08/26/2011 ENACTED. SB 1539 requires real estate appraisal management companies to be registered and post a $25,000 surety bond conditioned on compliance with the law. The bond is for the recovery of expenses, fines or fees due to the Department of Financial and Professional Regulation. The new law became effective upon enactment. House Bill No. 1651: Miscellaneous Bond Recent History 08/22/2011 ENACTED. HB 1651 increases the amount of the bond that the Secretary of Financial and Professional Regulation may require for trust companies from an amount not to $1 million to an amount not to exceed $2 million. Current law provides that securities or a surety bond are acceptable to meet this requirement. The bond secures the payment of any costs incurred should the trust company be placed into receivership. The new law becomes effective on January 1, 2012.

4 MASSACHUSETTS Senate Bill No. 82: Miscellaneous Bond Motor Vehicle Repair Shops Recent History 06/22/2011 (H) CONCURRED IN COMMITTEE REFERRAL. SB 82 would require motor vehicle repair shops to post a $10,000 surety bond. The bond would be conditioned on the payment of all penalties, fines and final judgments against the repair shop for violations of the applicable law. The surety s liability would be limited to the bond amount. Senate Bill No. 688/House Bill No. 2261: Uniform Trust Code POSITION: Oppose Recent History 05/13/2011 HEARING SCHEDULED. SB 688/HB 2261 would adopt the Uniform Trust Code. The bill provides that a trustee would be required to post a bond to secure performance of his or her duties only if the court requires it, or if the terms of the trust required one and the court has not dispensed with the requirement. The bill would authorize the court to determine the amount of a bond, its liabilities and whether sureties are necessary. The court could modify or terminate a bond at any time. Further, the liability of the trustee or of any sureties on the bond for acts or omissions of the trustee would not be discharged or affected by the trustee s resignation. Senate Bill No. 755: Fiduciary Bonds Recent History 05/13/2011 HEARING SCHEDULED. SB 755 would establish the Public Guardian Commission. The bill would require the Commission s fiduciary agencies to post a bond. The bond would have to be in amount equal to the total value of all assets that the commission holds as of the last day of the most recent fiscal year. The bond could not be less than $50,000. Senate Bill No. 1020: Public Officials Recent History 06/22/2011 HEARING SCHEDULED. SB 1020 would require the treasurer of the board for collaboration and regional districts that the bill would create to be bonded. Senate Bill No. 1196: Public Officials Recent History 07/18/2011 REPORTED FAVORABLY BY JOINT COMMITTEE ON PUBLIC SAFETY AND HOMELAND SECURITY. 07/18/2011 REFERRED TO SENATE COMMITTEE ON WAYS AND MEANS. SB 1196 would create the Middlesex Regional Emergency Communications Council (Council). The bill would require the treasurer of Council s board of directors to be bonded.

5 House Bill No. 1015: License Bonds Contractors POSITION: Support Recent History 09/18/2011 HEARING SCHEDULED. HB 1015 would require contractors and subcontractors to post a $10,000 surety bond. The bond would have to be issued by a surety company authorized to do business in the Commonwealth as surety. The bond would be for the benefit of the Commonwealth and its consumers and would be conditioned on compliance with the applicable law and regulations, as well as any contracts entered into, or any losses or damages sustained by the consumer. The bill provides that the surety s aggregate liability would be limited to the bond amount. The bond could be cancelled with 30 days notice. SFAA is working with CNA Surety and the AIA to enact this bill. House Bill No. 2293: Court Bond Recent History 09/01/2011 HEARING SCHEDULED. HB 2293 provides that an employer could be required to post a costs bond in connection with a proceeding for disputes over a noncompetition agreement. House Bill No. 2590/Senate Bill No. 1046: Public Officials Recent History 06/03/2011 HEARING SCHEDULED. HB 2590/SB 1046 would permit the governmental units of cities and towns to enter into joint powers agreements to form a regional government that would exercise the governmental unit s common powers jointly. The treasurer of the regional government s board of directors would have to provide a surety bond to secure the faithful performance of his or her duties. House Bill No. 3512: School Bond Recent History 09/12/2011 HEARING SCHEDULED. HB 3512 would require private occupational schools to be licensed and post a surety bond or other security of not less than $5,000. Private business school representatives would have to post a minimum $1,000 surety bond or other security in connection with licensure. House Bill No. 3702: Casinos Recent History 09/15/2011 PASSED HOUSE. TO SENATE. HB 3697 would authorize casinos to operate in the Commonwealth. The bill would require a bond to secure the casino s minimum capital investment that the bill would require in connection with a category 1 license. The bill would require a commitment of $500 million and a bond in an amount equal to ten percent of this amount. The bill also would establish procedures for placing gaming licensees in conservatorships when the license is revoked. The appointed conservator would have to be bonded. The bill also provides that a bond could be posted in connection with the adjudication of an assessment or penalty against the

6 casino. The bond would be posted in lieu of depositing the amount of the penalty in an escrow account. MICHIGAN Senate Bill No. 557: Court Bond Recent History 09/08/2011 REFERRED TO COMMITTEE OF THE WHOLE WITH SUBSTITUTE. SB 557 would establish procedures for filing an action for the revocation of an acknowledgement of parentage for a child and for determining the paternity of the child. The court would be authorized to require the person filing such action to post a bond or other security to secure the payment of the costs of the action plus attorneys fees if the person does not prevail. The recent substitution did not affect this provision. House Bill No. 4554: Miscellaneous Bond POSITION: Neutral Recent History 06/28/2011 REFERRED TO SENATE COMMITTEE ON NATURAL RESOURCES, ENVIRONMENT AND GREAT LAKES. HB 4554 would reduce the performance bond required in connection with a submerged log removal permit from $100,000 to $20,000. Current law requires the bond to secure compliance with the terms of the permit and the satisfactory removal of the log. NEW JERSEY Senate Bill No. 775: License Bond Elevator Contractors Recent History 06/13/2011 REPORTED FROM SENATE COMMITTEE WITH AMENDMENTS, 2ND READING. 06/13/2011 REFERRED TO SENATE BUDGET AND APPROPRIATIONS COMMITTEE. SB 775 would require a license bond for elevator contractors. Originally, the bill would have required a $3,000 bond. The bill was amended and instead provides that the Elevator, Escalator, and Moving Walkway Contractors Licensing Board, which the bill would create, would determine the bond amount instead. The bond would be conditioned on compliance with the proposed law. The bill would bar municipalities from requiring any similar bond from construction contractors licensed under the bill's provisions. Senate Bill No. 2914: School Bond Recent History 06/02/2011 INTRODUCED. SB 2914 is a school choice measure that would permit all students in kindergarten through twelfth grade to attend the school of their choosing. The bill would provide for scholarship funds for such students. Nonpublic schools participating in the program that receive $50,000

7 or more in such funds would have to provide evidence of financial viability, either through a surety bond or by providing financial information demonstrating that the school could repay the funds received. The bond would have to be in an amount equal to the aggregate amount of scholarship funds the school expects to pay to the parents or guardians of eligible students during the school year. Senate Bill No. 2164: Employee Leasing Companies Recent History 08/19/2011 ENACTED. SB 2164 revises the existing law for employee leasing companies, including the financial requirements. Prior law required such companies to maintain a minimum net worth of $100,000. In lieu of the net worth requirement, the company was able to post a bond or securities with a market value of $75,000. Instead meeting a minimum net worth requirement, the new law requires the company to maintain a positive working capital. If the company does not have a positive working capital, then it may post a bond, irrevocable letter of credit, or securities with a minimum market value that is equal to the amount required for achieving a positive working capital, plus $100,000. The new law becomes effective twelve months from the date of enactment. Assembly Bill No. 4033: School Bond Recent History 05/19/2011 INTRODUCED. AB 4033 would provide for a school choice program for all students to attend the public or non-public school of their choosing. A non-public school participating in the program that received $50,000 or more in scholarship funds would have to post a surety bond in an amount equal to the scholarship funds expected to be paid to the children s parents or guardians during the school year. In lieu of a bond, the bill would permit the school to provide financial information demonstrating that it has the ability to repay the funds received. Assembly Bill No. 4100: License Bond Contractors Recent History 06/13/2011 INTRODUCED. AB 4100 would require all construction trade contractors to post a minimum $50,000 license bond. A surety company licensed in the State would have to issue the bond. The bond would be for the use or benefit of any consumer who, after entering into a home improvement contract, incurs damages or suffers any loss arising out of a violation of the proposed law by the contractor. The bill would permit direct actions on the bond, but the surety s aggregate liability could not exceed the bond amount. The bond also would be exempted from the treble damages provisions of the State s Consumer Fraud Act. A letter of credit, securities cash or other security would be accepted in lieu of the bond. Assembly Bill No. 4145: Court Bond Recent History 06/20/2011 INTRODUCED.

8 AB 4145 would require the owner of an animal that has been impounded or confiscated as a result of the owner being charged with animal cruelty to post a bond to secure the payment of the costs of care for the animal. NEW YORK New York technically still is in session, but it is unlikely that any legislation would be considered this year. All bills not enacted will carry over to next year. Multiple Bills: Tax and Cost Bonds Local Jurisdiction Taxes Recent History 02/07/2011 INTRODUCED. In recent years, New York has considered a number of bills that would require a bond in connection with review processes for tax assessments made by local authorities. Anyone who disputes the tax or seeks a refund is required to deposit an amount equal to the tax and any penalties due, along with a surety bond from a state licensed surety for the costs of the proceeding. The petitioner has the option of posting a bond in the amount of the taxes, including interest and penalties, in addition to the costs bond. Anyone disputing a denied refund claim is subject to the same bond requirements described above. A number of these bills for certain jurisdictions have returned from the last session. The following are the bills that are currently pending in the legislature: Real Estate Transfer Tax: SB 5410 (County of Livingston) Senate Investigations and Operations Committee/AB 7861 (County of Livingston) Assembly Ways & Means Committee. Senate Bill No. 2913/Assembly Bill No. 4298: License Bond Mobility Dealers Recent History 06/21/2011 PASSED SENATE. TO ASSEMBLY. 06/21/2011 REFERRED TO ASSEMBLY TRANSPORTATION. SB 2913/AB 4298 would subject mobility dealers to the existing licensing and bond requirements for motor vehicle dealers. Mobility dealers are those who sell more than five mobility vehicles in a year. Such vehicles are specially equipped to transport a person with a disability and include mechanical devices such as wheel chair lifts or ramps. Current law requires motor vehicle dealers to post a $10,000 bond if they sold less than 200 vehicles in a calendar year, and a $25,000 bond is required if the dealer sells more than 200 vehicles in a calendar year. AB 4298 is pending in the Assembly Transportation Committee. Assembly Bill No. 3915: Court Bond Recent History 06/06/2011 AMENDAND RECOMMIT TO ASSEMBLY ECONOMIC DEVELOPMENT. AB 3915 would make the manufacturing any article or product while using stolen or misappropriated information technology an unfair act under New York law. The bill would

9 provide procedures for the court to place an attachment on the allegedly stolen or misappropriated information technology when the court cannot obtain personal jurisdiction over the accused person and instead must proceed in rem against the articles or products in question. Persons subject to the attachment proceedings could post a bond in an amount equal to the retail value of the allegedly stolen or misappropriated information or $25,000, whichever is less. The bond would stay the enforcement of the attachment. As introduced, the bill did not impact surety bonds, but it was substituted and now includes these provisions. Senate Bill No. 4268: Miscellaneous Bond Private Career Schools Recent History 06/10/2011 AMEND AND RECOMMIT TO SENATE FINANCE. SB 4268 would require private career schools to secure their liabilities to students should the school cease to operate through a performance bond, providing financial statements or by limiting the student s payment of tuition until the program of study is completed. The bond would have to be in an amount sufficient to secure the reimbursement of tuition funds. The recent amendment did not affect these provisions. Senate Bill No. 4712/Assembly Bill No. 7821: Miscellaneous Bond Recent History 06/20/2011 PASSED SENATE. TO ASSEMBLY. 06/20/2011 REFERRED TO ASSEMBLY INSURANCE. SB 4712/AB 7821 provides that private air ambulance services that have membership subscriptions, accept membership applications, charges membership fees, and provide air ambulance services to subscription members and designated members of their household would not be an insurer if the service: 1) has a valid operating certificate issued by the Department of Health; 2) posts a surety bond in the amount of $5,000 for every 1,000 subscribers or portion thereof; 3) provides membership materials with a statement clearly disclosing that membership with the service is not insurance and cannot be considered secondary insurance coverage or a supplement; and 4) the product is only offered by providers of the service. AB 7821 is pending in the Assembly Committee on Insurance. Senate Bill No. 5108/Assembly Bill No. 7457: Caps on Appeal Bonds POSITION: Oppose Recent History 06/17/2011 PASSED SENATE. TO THE ASSEMBLY. 06/17/2011 REFERRED TO ASSEMBLY JUDICIARY. SB 5108/AB 7457 would cap appeal bonds for civil litigation cases involving a participating manufacturer or a non-participating manufacturer of tobacco products at not more than $100 million, regardless of the value of the judgment. The bill would permit the appellate court to set the bond according to the applicable law or court rules. AB 7457 is pending in the Assembly Judiciary Committee.

10 Senate Bill No. 5477: License Bond Automobile Brokers Recent History 06/16/2011 PASSED SENATE. TO ASSEMBLY. 06/16/2011 PASSED ASSEMBLY. RETURNED TO THE SENATE. SB 5477 would require automobile broker businesses to post a $75,000 surety bond conditioned on the payment of all valid bank drafts that are drawn for the purchase of motor vehicles and for the safekeeping of customer deposits. Originally, the bill would have required a $250,000 bond. A surety company licensed in the State would have to issue the bond. Recovery may be made on the bond by persons obtaining a judgment against the broker for an act or omission on which the bond is commissioned. The surety s aggregate liability would be limited to the bond amount and in no event would the surety s liability be for total claims in excess of the bond amount regardless of the nature of the claims or the number of years the bond is in force. Surety companies could cancel the bond with 60 days notice. Assembly Bill No. 5997: Municipal Bond Sales Recent History 05/24/2011HELD FOR CONSIDERATION IN ASSEMBLY LOCAL GOVERNMENTS AB 5997 would require a 1% bid bond for the sale of municipal bonds. Surety bonds would be accepted for this requirement. Assembly Bill No. 6699: Miscellaneous Bond Public Vessels POSITION: Neutral Recent History 06/07/2011 REPORTED AND REFERRED TO ASSEMBLY CODES. AB 6699 would require public vessels to obtain a liability insurance policy or a surety bond in connection with a certificate to operate and carry passengers. Assembly Bill No. 7790: Depositories Recent History 05/14/2011 INTRODUCED. AB 7790 would permit savings banks, savings and loan associations and credit unions to act as depositories for municipal corporations. Existing law provides that a depository may secure the funds with a pledge of obligations or securities that are lawfully required or accepted by the depositor, a surety bond or a letter of credit. Assembly Bill No. 7815: Public Officials Recent History 05/17/2011 INTRODUCED. AB 7815 would require the deputy claims auditor for a school district to be bonded. The board of education for the district determines the bond amount for its officials under existing law.

11 Assembly Bill No. 8183: Miscellaneous Bond POSITION: Support Recent History 06/16/2011 PASSED ASSEMBLY. TO SENATE. AB 8183 would increase the surety bond for employment agencies from $5,000 to $20,000. Assembly Bill No. 8341: License Bond Debt Management Services Seeking Amendment on Bond Amount Recent History 06/14/2011 INTRODUCED. AB 8341 would require debt management service providers to post a $250,000 surety bond in connection with licensure. The Superintendent of Banks would be permitted to require a larger bond amount based on the financial condition of the licensee. The bill would require surety companies issuing the bond to be licensed in the State. The bond would run to the State for its benefit and individuals who entered into agreements with the provider. Other forms of security would be accepted in lieu of the bond. Assembly Bill No. 8429: License Bond Debt Collection Agency Recent History 06/15/2011 INTRODUCED. AB 8429 would require debt collection agencies to be licensed and post a surety bond, contract of indemnity, or an irrevocable letter of credit that must be payable to the people of New York. The bond amount would be based on the number of persons employed by the licensee. A $10,000 bond would be required for one to four employees; a $25,000 bond for five to nine employees; a $50,000 bond for 10 to 20 employees, and a $75,000 bond for 20 or more employees. The bond would secure the licensee s compliance with the applicable law and the payment of all costs and penalties. The surety s total liability would be limited to the face amount of the bond, regardless of the number or nature of claims made against the bond or the number of years the bond remained in force. Assembly Bill No. 8440: Home Improvement Contractors Seeking to Eliminate Recovery Fund Recent History 06/15/2011 INTRODUCED. AB 8440 would require home improvement contractors to register and post a bond in an amount based on the volume of the contractor's business in the 12 months prior to registering. For contractors with home improvement contracts not exceeding a total cash value of $500,000, a surety bond in the amount of $10,000 would be required; for contracts with a total value of $500,000 to $1 million, the bond would have to be $25,000; and for contracts with a total value exceeding $1 million, the bond would have to be $50,000. The bond would be conditioned on the payment of judgments against the contractor resulting from a breach of his or her contracts. The surety's liability would be limited to the penal sum of the bond and in no event could the surety be liable for claims in excess of the bond amount. The bond could be canceled with 30 days notice. In lieu of bonding, the bill would allow contractors to participate in a state recovery fund.

12 OHIO House Bill No. 136: School Bond Recent History 05/11/2011 SUBSTITUTE BILL ACCEPTED IN HOUSE EDUCATION COMMITTEE. HB 136 would require non-public schools to post a surety bond in connection with receiving funds from a school choice scholarship program. The substitution did not affect the bonding provision. House Bill No. 229: License Bond Recent History 07/15/2011 ENACTED. HB 229 exempts brokers and dealers of poultry from the existing law's license bond requirements. House Bill No. 267: Receivers Recent History 06/21/2011 REFERRED TO HOUSE COMMITTEE HOUSE JUDICIARY AND ETHICS. HB 267 would adopt the Revised Uniform Unincorporated Nonprofit Association Act. The bill would provide procedures for placing an unincorporated nonprofit association into receivership. The receiver could be required to post a surety bond. PENNSYLVANIA House Bill No. 33/House Bill No. 1406/House Bill No. 1671/House Bill No. 1705/House Bill No. 1804/Senate Bill No. 1140/Senate Bill No. 680: Tax Bond Natural Gas Operations Recent History 05/25/2011 HB 33 RE-REFERRED TO HOUSE FINANCE COMMITTEE. HB 33/HB 1406/HB 1671/HB 1705/HB 1804/SB 680/SB 1140 would impose a tax on the extraction of natural gas in Pennsylvania. The bill would authorize the Department of Revenue (Department) to require a surety bond from nonresident natural persons, or from any foreign entities, not authorized to do business or not having an established place of business in the Commonwealth. The bond would secure the payment of the tax and any penalties that may become due, and the Department would determine the amount required. The Department also could require a bond from any person petitioning for reassessment of any tax assessment over $500 or where the Department believes the ultimate collection of the tax is in jeopardy. Further, the Department could require a bond from any person who filed a return or made payment more than 30 days late on three or more occasions within a 12-month period. Cash or securities would be accepted in lieu of surety bonds in any of these bond requirements.

13 SB 1140 is pending in the Senate Finance Committee. HB 1671, HB 1705 and HB 1804 have not moved since they were introduced. HB 1406 and SB 680 have not moved since the last report. House Bill No. 424: License Bond Public Adjusters POSITION: Support Recent History 06/15/2011 PASSED HOUSE. TO SENATE. HB 424 would revise the current law governing public adjusters in Pennsylvania to conform it to the NAIC model law. The bill would reduce the existing bond required for public adjusters from a minimum of $40,000 to a minimum of $20,000, and it would require each person to post a bond. Current law permits partnerships, associations and corporations to post the bond. The bill also would eliminate a license classification for public adjuster solicitors in its entirety, including the corresponding bond requirement. The law requires a minimum $8,000 license bond for public adjuster solicitors. House Bill No. 1055/Senate Bill No. 1069: Professional Employer Organizations POSITION: Support with Amendments to Surety Qualification Requirements Recent History 05/23/2011 PASSED HOUSE. TO SENATE. HB 1055/SB 1069 would require PEOs to maintain a positive working capital. If the PEO does not have a positive working capital, the bill would permit it to post a surety bond, bonds of the United States, a letter of credit, or securities in an amount that would make up the deficiency plus $100,000. The bond would secure the payment of any tax, wage, benefit, or other entitlement due to or with respect to a covered employee if the PEO does not make the payment when due. The bill would require the surety company issuing the bond to possess a current A.M. Best Rating of "B+" or better or a Standard and Poor's rating of claims paying ability of "A" or better. The bill also contains provisions concerning employee coverage under insurance policies and bonds in connection with an employer's participation in a PEO. This bill is based on model legislation that has been introduced in recent sessions. SB 1069 has not moved since it was introduced Pennsylvania Senate Bill No. 1102: Notary Bonds POSITION: Seeking Amendments to Bond Amount Recent History 06/14/2011 INTRODUCED. SB 1102 would provide that notaries public that notarize deeds for the conveyance of real property would have to post a surety bond for $100,000. Existing law requires all notaries public to post a $10,000 surety bond. Senate Bill No. 1159: License Bond Motor Vehicle Sales Finance Company Recent History 06/17/2011 INTRODUCED. SB 1159 would require motor vehicle sales finance companies to be licensed and post a $5,000 surety bond from a surety company authorized to do business in the Commonwealth. The bill would permit banks filing an application for the license to execute the bond on their own behalf in lieu of a bond from a surety company. The bond would be conditioned on

14 compliance with all applicable laws and regulations and on payment of all amounts due to the Commonwealth, the Department of Banking (Department) or any person. The bill would permit direct actions on the bond, provided the injured person obtained a judgment in court against the licensee and the Department assents to the action. The bill also would require property recovery agencies to be licensed and post a $1 million surety bond and obtain an insurance policy for $1 million per occurrence. In lieu of an individual bond, the agency could participate in a Pennsylvania property recovery association s client protection fund program. Senate Bill No. 1193: License Bond Debt Management Services POSITION: Support Recent History 07/21/2011 INTRODUCED. SB 1193 would re-write the existing law for debt management service providers. Current law requires a license bond "in an amount greater than the total amount of Pennsylvania consumer funds that the licensee will hold directly or in trust at any time." Instead, the bill would require a bond for a minimum of $10,000. The bond amount would be based on the licensee's financial condition and could not be in an amount more than $50,000. House Bill No. 1774: License Bond Private Detectives POSITION: Neutral Recent History 07/20/2011 INTRODUCED. HB 1774 would rewrite current law concerning private detectives, which requires a $10,000 license bond. The bill would revise the bond requirement so that the State Board of Private Investigators, Security Professionals and Fugitive Recovery Agents would determine the amount required for private investigators. House Bill No. 1793: School Bond POSITION: Oppose Repeals Bond Requirement Recent History 07/20/2011 INTRODUCED. HB 1793 would repeal the bond required in connection with licensure for private schools. The bond secures the reimbursement of unearned tuition paid to the school by students. The bill would replace the bond requirement with a recovery fund. House Bill No. 1800: Permit Bond Oil & Gas Wells POSITION: Seeking Amendments to Address High Bond Amounts Recent History 07/26/2011 INTRODUCED. HB 1800 would overhaul the current bonding requirements for oil and gas wells. Current law requires a bond in the amount of $2,500 per well or a $25,000 blanket bond that covers all wells that the permit holder operates in Pennsylvania. The bill would provide a schedule for the bond amounts based on the number of wells that are operating in the State and their depth below the surface as follows:

15 Wells less than 2,500 feet in depth: Wells Bond Amount Up to 25 wells $2,500 per well, not to exceed $35, wells $35,000, plus $2,500 per well, not to exceed $60, wells $60,000, plus $2,500 per well, not to exceed $100,000 More than 100 wells $100,000, plus $2,500 per well, not to exceed $250,000 Wells less between 2,500 feet and 5,000 feet in depth: Wells Bond Amount Up to 25 wells $5,000 per well, not to exceed $70, wells $70,000, plus $5,000 per well, not to exceed $120, wells $120,000, plus $5,000 per well, not to exceed $200,000 More than 100 wells $200,000, plus $5,000 per well, not to exceed $500,000 Wells over 5,000 feet in depth: Wells Bond Amount Up to 25 wells $12,500 per well, not to exceed $220, wells $220,000, plus $12,500 per well, not to exceed $375, wells $375,000, plus $12,500 per well, not to exceed $625,000 More than 100 wells $625,000, plus $12,500 per well HB 1800 also contains provisions imposing a tax on the extraction of natural gas in Pennsylvania. The bill would authorize the Department of Revenue (Department) to require a surety bond from nonresident natural persons, or from any foreign entities, not authorized to do business or not having an established place of business in the Commonwealth. The bond would secure the payment of the tax and any penalties that may become due, and the Department would determine the amount required. The Department also could require a bond from any person petitioning for reassessment of any tax assessment over $500 or where the Department believes the ultimate collection of the tax is in jeopardy. Further, the Department could require a bond from any person who filed a return or made payment more than 30 days late on three or more occasions within a 12-month period. Cash or securities would be accepted in lieu of surety bonds in any of these bond requirements. WISCONSIN Assembly Bill No. 60: Public Officials POSITION: Neutral Recent History 05/11/2011 PASSED ASSEMBLY. TO HOUSE. AB 60 would permit members of the county veterans service commission and county veteran service commission officers to be covered under the blanket bond that existing law provides may cover county officials.