H. B. 2261
(By Mr. Speaker, Mr. Kiss, and Delegate Trump)
[By Request of the Executive]
[Introduced January 15, 1999; referred to the
Committee on Finance.]
A BILL to amend and reenact section twelve-b, article eight,
chapter thirty-one-a of the code of West Virginia, one
thousand nine hundred thirty-one, as amended; to further
amend said article by adding thereto a new section,
designated section twelve-d, all relating to use of point of
sale terminals to access payments of public assistance
benefits and make cash withdrawals in excess of fifty
dollars during sales transactions.
Be it enacted by the Legislature of West Virginia:
That section twelve-b, article eight, chapter thirty-one-a
of the code of West Virginia, one thousand nine hundred
thirty-one, as amended, be amended and reenacted; that said
article be further amended by adding thereto a new section,
designated section twelve-d, all to read as follows:
ARTICLE 8. HEARINGS; ADMINISTRATIVE PROCEDURES; JUDICIAL REVIEW; UNLAWFUL ACTS; PENALTIES.
31A-8-12b. Installation and operation of customer bank
communication terminals permitted.
(a) Any banking institution as defined in section two,
article one of this chapter, individually or jointly with one or
more other banking institutions or other federally insured
financial institutions having their principal offices in this
state, or any combination thereof, may upon ten days prior
written notice filed with the commissioner, install, operate and
engage in banking business by means of one or more customer bank
communication terminals. Any banking institution which installs
and operates a customer bank communication terminal:
(1) Shall make such customer bank communication terminal
available for use by other banking institutions; and
(2) May make such customer bank communication terminal
available for use by other federally insured financial
institutions, all in accordance with regulations promulgated by
the commissioner. Such customer bank communication terminals
shall not be considered to be branch banks or branch offices,
agencies or places of business or off-premises walk-in or
drive-in banking facilities; nor shall the operation of such
customer bank communication terminals to communicate with and
permit financial transactions to be carried out through a
nonexclusive access interchange system be considered to make any banking institution which is part of such a nonexclusive access
interchange system to have illegal branch banks or branch
offices, agencies or places of business or off-premises walk-in
or drive-in banking facilities.
(b) Notwithstanding the provisions of subdivision (1),
subsection (a) of this section, a customer bank communication
terminal located on the premises of the principal office or
branch bank of a banking institution or on the premises of an
authorized off-premises facility need not be made available for
use by any other banking institution or its customers.
(c) For purposes of this section, "customer bank
communication terminal" means any electronic device or machine
owned, leased, or operated by a bank, together with all
associated equipment, structures and systems, including, without
limitation, point of sale terminals, through or by means of which
a customer and a banking institution may engage in any banking
transactions, whether transmitted to the banking institution
instantaneously or otherwise, including, without limitation, the
receipt of deposits of every kind, the receipt and dispensing of
cash, requests to withdraw money from an account or pursuant to
a previously authorized line of credit, receiving payments
payable at the bank or otherwise transmitting instructions to
receive, transfer or pay funds for a customer's benefit.
Personal computers, telephones and associated equipment which enable a bank customer to conduct banking transactions at their
home or office through links to their bank's computer or
telephone network, do not constitute a "customer bank
communication terminal" under this section. All transactions
initiated through a customer bank communication terminal shall be
subject to verification by the banking institution.
(d) No person, other than: (1) A banking institution
authorized to engage in the banking business in this state; or
(2) a credit union authorized to conduct business in this state;
may operate any automatic teller machine ("ATM") or automatic
loan machine ("ALM") located in this state:
Provided, That ATM
terminals of out-of-state state banks not having branches in this
state shall be allowed to operate to the same extent as a West
Virginia bank if a national bank from that state not having
branches in West Virginia could do so through a federal
preemption of state law.
(e) For the purposes of this section, "point of sale
terminal" means a customer bank communication terminal used for
the primary purpose of either transferring funds to or from one
or more deposit accounts in a banking institution or segregating
funds in one or more deposit accounts in a banking institution
for future transfer, or both, in order to execute transactions
between a person and his
or her customers incident to sales,
including, without limitation, devices and machines which may be used to implement and facilitate check guaranty and check
authorization programs.
(f) Nothing in this section prevents point of sale terminals
and associated equipment from being owned, leased or operated by
nonbanking entities:
Provided, That such persons may not engage
in the business of banking by using point of sale devices. The
use of a point of sale terminal to enable a customer or other
person to withdraw and obtain cash of more than fifty dollars in
excess of the sales transaction purchase amount will be presumed
to constitute engaging in the business of banking:
Provided,
That cash withdrawals through such a point of sale terminal in
excess of fifty dollars shall not constitute engaging in the
business of banking if the sales transaction is made with the use
of an electronic benefits transfer card issued by the West
Virginia department of health and human resources to transmit
payments of food benefits, temporary assistance to needy
families, or other similar assistance programs mandated by
federal or state government: Provided, however, That any
retailer, agency or person providing cash withdrawals through
such a point of sale terminal shall be limited to charging a fee
for such service in the amount of the higher of one dollar or one
percent of the amount of cash withdrawn.
(g) Except for customer bank communication terminals located
on the premises of the principal office or a branch bank of the banking institution or on the premises of an authorized
off-premises walk-in or drive-in banking facility, a customer
bank communication terminal shall be unattended or attended by
persons not employed by any banking institution utilizing the
terminal:
Provided, That:
(1) Employees of the banking institution may be present at
such terminal not located on the premises of an authorized
off-premises facility solely for the purposes of installing,
maintaining, repairing and servicing same; and
(2) A banking institution may provide an employee to
instruct and assist customers in the operation thereof:
Provided, That such employee shall not engage in any other
banking activity.
(h) The commissioner shall prescribe by regulation the
procedures and standards regarding the installation and operation
of customer bank communication terminals, including, without
limitation, the procedure for the sharing thereof.
31A-8-12d. Limited establishment and use of point of sale
terminals for special purposes and circumstances
relating to certain public assistance payments.
(a) The West Virginia department of health and human
resources, or its successor agency, shall have the authority to
establish and own point of sale terminals as defined in section
twelve-b of this article for banking institutions. Such terminals and associated equipment may be placed at any location
within this state where the department shall determine such
terminals are needed to provide reasonable access to recipients
of state or federal cash and food or other benefits through
electronic means. Such terminals established pursuant to this
section may be used to provide any amount of cash payment or
allowable purchase of retail items or other benefits as
determined by the department of health and human resources
pursuant to state law and regulations and, where necessary, in
cooperation with the United States department of agriculture or
other federal agencies.
(b) Point of sale terminals established pursuant to this
section shall not be required to be shared with private sector
financial institutions and may be established for the sole
purpose of providing access to electronically transmitted
government benefits for clients of the West Virginia department
of health and human resources.
(c) Any retailer, agency or other person which shall provide
cash withdrawal services from its own funds through point of sale
terminals established pursuant to this section shall be limited
to charging a fee for such service in the amount of the higher of
one dollar or one percent of the amount of cash withdrawn.
(d) The department of health and human resources shall not
compete with private sector providers of point of sale terminals or for profit, and shall remove its equipment from any location
at which it can reasonably be determined that such terminals will
be provided by private sector sources in the normal course of
business.
NOTE: The purpose of this bill is to ensure that the West
Virginia Department of Health and Human Resources can provide
public assistance benefits through the use of electronic benefits
transfer cards to residents in areas where access to point of
sale terminals or automated teller machines may be limited. This
bill carves out a narrow exception to the general limitation on
using a point of sale terminal to withdraw more than fifty
dollars in excess of a sales transaction at a non-banking
institution and imposes the same limitation on the fee that can
be charged for providing cash withdrawal services as is allowed
for check cashing services in other statutes.
Strike-throughs indicate language that would be stricken
from the present law, and underscoring indicates new language
that would be added.
§31A-8-12d is new; therefore, strike-throughs and
underscoring have been omitted.
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