Capitol Notes: Week 12 Recap

MONTGOMERY, Ala., April 23, 2021 — The 2021 Regular Session is officially drawing to a close now that the Alabama Legislature has completed 25 of the session’s 30 legislative days. Since it takes a minimum of five legislative days for a bill to become law, next Tuesday, the 26th legislative day, marks the last time a viable bill can be introduced this session. Representatives and Senators met for two legislative days this week, and plan to keep this same schedule in each of the next two weeks, followed by a one-week break. The session’s final day will be May 17.

The association was spearheading passage of four bills this session. As of this writing, three of those bills have passed the Legislature and the fourth one is set to pass on Tuesday.

The House on Tuesday gave final passage to Senate Bill 275 by Sen. Sam Givhan (R-Huntsville), legislation that authorizes a notarization process known as “remote ink notarization.” Originally introduced to Alabama last year in an Executive Order, this process allows a notary to attest to a signature that was witnessed using a videoconferencing platform. Rep. Andy Whitt (R-Huntsville) managed the bill in the House, and Governor Ivey is expected to sign it soon.

The House also gave final passage on Tuesday to Senate Bill 279 by Sen. Dan Roberts (R-Mountain Brook), legislation that provides for how contracts tied to LIBOR would be governed after LIBOR is no longer published.  The House-passed version of the bill is an exact replica of similar legislation recently enacted in New York.  Rep. Danny Garrett (R-Trussville) managed the bill in the House, and Governor Ivey is expected to sign it soon.

Since the Elder Abuse Prevention legislation, Senate Bill 181, is already law, the lone remaining bill on the association’s radar is Senate Bill 282 by Sen. Shay Shelnutt (R-Trussville), a bill that would give Trustees a third option to use when seeking to be released from their service to a Trust.  The bill will be managed in the House by Rep. Merika Coleman (D-Birmingham), who sponsored the House companion bill.  It is on a House floor calendar for Tuesday, April 27th.  If passed by the House, the bill would go to Governor Ivey for her signature.

Bills of importance to the banking industry include the following:

HB147 by House Financial Services Committee Chairman Chris Blackshear (R-Phenix City) and SB181 by Senate Banking and Insurance Committee Chairman Shay Shelnutt (R-Trussville) is the Elderly and Vulnerable Adult Financial Protection Act of 2021.  These bills give financial institutions full discretion to refuse or delay a financial transaction whenever financial abuse of an elderly or vulnerable adult customer is reasonably expected.  Introduced last year, these bills garnered unanimous support in both chambers, but were unable to pass into law after the session abruptly ended because of COVID-19.  Senate Bill 181 was signed into law on March 9.  It is now Act 2021-78.

HB196 by Rep. Matt Simpson (R-Daphne) and SB35 by Sen. Greg Albritton (R-Atmore) makes technical changes to the Alabama Uniform Trust Decanting Act, a law passed in 2019 that provides a method for reforming or modernizing an irrevocable trust.  Both bills have been passed by the House Financial Services Committee, putting the Senate bill one vote away from the Governor’s desk.  Senate Bill 35 was signed into law on March 16.  It is now Act 2021-143.

HB216 by Rep. Craig Lipscomb (R-Gadsden) is the Alabama Consumer Privacy Act, a law giving consumers various rights related to the collection of personal information by businesses.  Modeled after a California law, the legislation imposes onerous burdens on businesses of all types, including financial institutions.  The association had a meeting with the sponsor earlier this week outlining concerns about the bill, and the sponsor assured us that he did not plan to pursue the legislation.

HB293 by Rep. David Faulkner (R-Mountain Brook) is the Qualified Dispositions in Trust Act, which would authorize the creation of self-settled trusts in Alabama.  Drafted by the Alabama Law Institute, this bill could theoretically expand opportunities for financial institutions providing trust-related services.  On the other hand, this bill could provide debtors with an additional option of shielding assets from creditors.  Senate Bill 293 was signed into law on April 13.  It is now Act 2021-238.

HB457 by Rep. Chris Pringle (R-Mobile) expands the Alabama Residential Mortgage Satisfaction Act to include mortgages securing commercial agricultural properties.  This is the second year Pringle has introduced this legislation.  The bill defines “commercial agricultural properties” as property located in this state that is used primarily for the growing of plants, trees, or animals primarily for a for-profit business and not for recreational purposes.  The bill has passed out of the Senate Fiscal Responsibility and Economic Development Committee and is now in a position to be considered by the full Senate.

HB470 by Rep. Andy Whitt (R-Harvest) and SB275 by Sen. Sam Givhan (R-Huntsville) would allow documents to be remotely notarized under certain conditions.  Drafted by a coalition of trade groups including the association, the Alabama Association of Realtors, and the Alabama Land Title Association, this bill codifies the “Remote Ink Notarization” provisions of Gov. Ivey’s Emergency Executive Orders.  In short, it sets up guidelines that would allow a notary public to witness the signature of a document using videoconferencing platforms.  The Legislature passed Senate Bill 275 this week.  The bill becomes law upon Governor Ivey’s signature. 

HB474 by Rep. Merika Coleman (D-Birmingham) and SB282 by Sen. Shay Shelnutt (R-Trussville) would amend the Uniform Trust Code to create a third option for a Trustee to use when seeking to be released from his or her service to a Trust.  Under this option, release would be granted if no beneficiary or interested party objected to the release in writing within 45 days of receiving a notice of the release and an accounting of the Trust from the previous two years.  The House will consider the Senate bill on Tuesday.  If passed, the bill will go to the Governor for her signature.

HB475 by Rep. Danny Garrett (R-Trussville) and SB279 by Sen. Dan Roberts (R-Mountain Brook) provides for how certain financial contracts would be governed after the publication of LIBOR is discontinued later this year.  The Legislature passed Senate Bill 279 this week.  The bill becomes law upon Governor Ivey’s signature. 

HB603 by Rep. Joe Lovvorn (R-Auburn) and SB366 by Sen. Tom Whatley (R-Auburn) makes significant changes to laws related to guardianships and conservatorships.  The Senate bill was recently substituted and approved by the Senate Judiciary Committee and is now in a position to be considered by the full Senate.

SB316 by Sen. Garlan Gudger (R-Cullman) would prohibit payment processing from charging an interchange fee on any portion of a payment transfer that was attributed to state or local taxes or fees.  Legislation of this type has been introduced in multiple states around the country.  The consequences of this bill becoming law could have negative implications on the banking and retail industries

SB352 by Sen. Arthur Orr (R-Decatur) revises the 2021 payment date for financial institutions excise taxes and income taxes to coincide with the revised due dates for the corresponding federal payments.  This bill passed the House on Tuesday and was signed into law by Governor Ivey the same day.  It is now Act 2021-203

SB379 by Sen. Dan Roberts (R-Mountain Brook) among other things, provides for a one-month

extension of the due date of tax returns for financial institutions in tax years beginning on or after January 1, 2021, in order to provide taxpayers with additional time to calculate their tax liabilities under new federal and state tax law, without incurring a late filing penalty. The filing extension would not extend the due date of the tax liability by these taxpayers. This bill would also authorize the Department of Revenue, in its discretion, to extend the due date of tax returns for Alabama financial institutions by one month in tax years beginning on or after January 1, 2020, but before January 1, 2021.  This bill was approved by the Senate Finance and Taxation-Education Committee on Tuesday and is now in a position to be considered by the full Senate.

Through 25 of a possible 30 legislative days, Representatives and Senators have introduced 1,042 bills – 642 in the House and 400 in the Senate – and 345 resolutions.  As of this writing, 282 of these measures have been enacted into law.

The session must end on or before May 17.  Legislators will return to Montgomery on Tuesday for the 26th legislative day.


Look for this update to be published each week during the regular legislative session and at other times as necessary.  This update is written by Jason Isbell, an attorney in the Governmental Solutions practice group at Maynard Cooper & Gale. Along with his colleagues at the firm, Jason is a governmental affairs consultant for the association. Jason can be reached at jisbell@maynardcooper.com or at (334) 782-1219.