ENROLLED
H. B. 2712
(By Delegates Douglas, Collins, Prunty,
H. White, Hatfield, Everson and Stalnaker)
[Passed March 12, 1999; in effect ninety days from passage.]
AN ACT to amend and reenact section one, article one, chapter
forty-seven-a of the code of West Virginia, one thousand
nine hundred thirty-one, as amended, relating to continuing
the West Virginia lending and credit rate board.
Be it enacted by the Legislature of West Virginia:
That section one, article one, chapter forty-seven-a of the
code of West Virginia, one thousand nine hundred thirty-one, as
amended, be amended and reenacted to read as follows:
ARTICLE 1. LENDING AND CREDIT RATE BOARD.
§47A-1-1. Legislative findings; creation, membership, powers
and duties of board; termination of board.
(a) The Legislature hereby finds and declares that:
(1) Changes in the permissible charges on loans, credit
sales or transactions, forbearance or other similar transactions requires specialized knowledge of the needs of the citizens of
West Virginia for credit for personal and commercial purposes and
knowledge of the availability of such credit at reasonable rates
to the citizens of this state while affording a competitive
return to persons extending such credit;
(2) Maximum charges on loans, credit sales or transactions,
forbearance or other similar transactions executed in this state
should be prescribed from time to time to reflect changed
economic conditions, current interest rates and finance charges
throughout the United States and the availability of credit
within the state in order to promote the making of such loans in
this state; and
(3) The prescribing of such maximum interest rates and
finance charges can be accomplished most effectively and flexibly
by a board comprised of the heads of designated government
agencies, university schools of business and administration and
members of the public.
(b) In view of the foregoing findings, it is the purpose of
this section to establish the West Virginia lending and credit
rate board and authorize said board to prescribe semiannually the
maximum interest rates and finance charges on loans, credit sales
or transactions, forbearance or similar transactions made
pursuant to this section subject to the provisions, conditions and limitations hereinafter set forth and to authorize lenders,
sellers and other creditors to charge up to the maximum interest
rates or finance charges so fixed. The rates prescribed by the
board are alternative rates and any creditor may utilize either
the rate or rates set by the board or any other rate or rates
which the creditor is permitted to charge under any other
provision of this code.
(c) The West Virginia lending and credit rate board shall be
comprised of:
(1) The director of the governor's office of economic and
community development;
(2) The West Virginia state treasurer;
(3) The West Virginia banking commissioner;
(4) The deans of the schools of business and administration
at Marshall University and West Virginia University;
(5) The director of the division of consumer protection of
the attorney general's office; and
(6) Three members of the public appointed by the governor
with the advice and consent of the Senate. The members of the
public shall be appointed for terms of six years each, and until
their successors are appointed and qualified; except that of the
members first appointed, one shall be appointed for a term of two
years, one for a term of four years and one for a term of six years. A member who has served one full term of six years shall
be ineligible for appointment for the next succeeding term.
Vacancies shall be filled by appointment of the governor with the
advice and consent of the Senate, or if any vacancy remains
unfilled for three months, by a majority vote of the board. The
West Virginia banking commissioner shall serve as chairperson of
the board and the rate or rates set by the board shall be
determined by a majority vote of those members of the board in
attendance at the respective board meeting.
(d) The West Virginia lending and credit rate board is
hereby authorized and directed to meet after the thirty-first day
of December, one thousand nine hundred eighty-three, on the first
Tuesday of April and on the first Tuesday of October of each year
or more or less frequently as required by the circumstances and
to prescribe by order a maximum rate of interest and finance
charge for the next succeeding six months, effective on the first
day of June and on the first day of December, for any loans,
credit sales or transactions, forbearance or similar transactions
made pursuant to this section. In fixing said maximum rates of
interest and finance charge, the board shall take into
consideration prevailing economic conditions, including the
monthly index of long-term United States government bond yields
for the preceding calendar month, yields on conventional commercial short-term loans and notes throughout West Virginia
and throughout the United States and on corporate interest- bearing securities of high quality, the availability of credit at
reasonable rates to the citizens of this state which afford a
competitive return to persons extending such credit and such
other factors as the board may determine.
(e) Any petition proposing a change in the prescribed
maximum rates of interest and finance charges must be filed in
the office of the banking commissioner no later than the
fifteenth day of February in order to be voted on at the board
meeting on the first Tuesday of April and no later than the
fifteenth day of August in order to be voted on at the board
meeting on the first Tuesday of October. Whenever any change in
the prescribed maximum rates of interest and finance charges is
proposed the board shall schedule a hearing, at least fifteen
days prior to the board meeting at which the proposed rates of
interest and finance charge will be voted on by the members of
the board, and shall give all interested parties the opportunity
to testify and to submit information at such public hearing that
is relevant. Notice of the scheduled public hearing shall be
issued and disseminated to the public at least twenty days prior
to the scheduled date of the hearing.
(f) The board shall prescribe by order issued not later than the twentieth day of April and not later than the twentieth day
of October, in accordance with the provisions of subsection (d)
of this section the maximum rates of interest and finance charge
for the next succeeding six months for any loan, credit sale,
forbearance or similar transaction made pursuant to this section
and shall cause such maximum rate of interest and finance charge
to be issued and disseminated to the public, such maximum rate of
interest and finance charge to be effective on the first day of
June and the first day of December for the next succeeding six
months.
(g) Notwithstanding the other provisions of this chapter,
the West Virginia lending and credit rate board shall not be
required to meet if no petition has been filed with the board
requesting a hearing and interest rates and economic conditions
have not changed sufficiently to indicate that any change in the
existing rate order would be required, and there are not at least
two board members who concur that a meeting of the board is
necessary. If the board does not meet, the maximum rates of
interest and finance charges prescribed by the board in the
existing rate order shall remain in full force and effect until
the next time the board meets and prescribes different maximum
rates of interest and finance charges.
(h) If circumstances and economic conditions require, the chairperson or any three board members, at any time, may call an
emergency interim meeting of the West Virginia lending and credit
rate board, at which time the chairperson shall give ten days'
notice of the scheduled emergency meeting to the public. All
interested parties shall have the opportunity to be heard and to
submit information at such emergency meeting that is relevant.
Any and all emergency rate board orders shall be effective within
thirty days from the date of such emergency meeting.
(i) Each member of the board, except those whose regular
salary is paid by the state of West Virginia, shall receive
seventy-five dollars per diem while actually engaged in the
performance of the duties of the board. Each member shall be
reimbursed for all reasonable and necessary expenses actually
incurred during the performance of their duties, except that in
the event the expenses are paid by a third party the members
shall not be reimbursed by the state. The reimbursement shall be
paid out of the revolving fund established by section two of this
article upon a requisition upon the state auditor, properly
certified by the banking commissioner.
(j) In setting the maximum interest rates and finance
charges, the board may set varying rates based on the type of
credit transaction, the term of transaction, the type of debtor,
the type of creditor and other factors relevant to determination of such rates. In addition, the board may set varying rates for
ranges of principal balances within a single category of credit
transactions.
(k) Pursuant to the provisions of article ten, chapter four
of this code, the West Virginia lending and credit rate board
shall continue to exist until the first day of July, two thousand
five.