Session Review: Banking, Commerce and Insurance

Changes to commerce and insurance regulation topped the list of banking issues considered by lawmakers this session.

Senators approved a bill that authorizes a new insurance producer license in Nebraska.

LB458, introduced by Seward Sen. Mark Kolterman, authorizes the state director of insurance to issue a limited lines travel insurance producer license. The new license authorizes an individual or business entity to sell, solicit or negotiate travel insurance through a licensed insurer.

A limited lines travel insurance producer and those registered under the producer’s license are exempt from examination, prelicensing education and continuing education requirements for producers. The bill passed 48-0.

Lawmakers also changed requirements related to the roster of abstracters maintained by the state’s Abstracters Board of Examiners.

LB269, introduced by Venango Sen. Dan Hughes, requires the board to update the roster annually on their website in a printable format. The bill also removes a requirement that a copy of the roster be sent to all registered abstracters and furnished to the public upon request at the cost of production.

The bill passed on a 47-0 vote.

Small businesses may seek startup capital through new avenues under a bill approved by the Legislature this session.

Under LB226, introduced by Lincoln Sen. Colby Coash, small businesses may raise up to $2 million each year from accredited or unaccredited investors.

All projects attempting to raise money via crowdfunding will require approval from the state Department of Banking and Finance. Individuals investing money under LB226 will receive a proportionate security stake in the company in exchange for their investment, without registration under state and federal securities laws. Unaccredited investors will not be allowed to invest more than $5,000 in a particular company.

Investors must be residents of Nebraska and will be required to sign a certificate acknowledging the potential for the complete loss of investment. The bill passed 48-0.

Senators also passed a bill that makes changes to funds intended to mitigate the impact of economic downsizing.

LB457, introduced by Grand Island Sen. Mike Gloor, terminates the Industrial Recovery Fund. Existing funds will be distributed evenly to the Site and Building Development Fund and the Nebraska Affordable Housing Trust Fund.

Projects that were eligible under the Industrial Recovery Fund—those that mitigate the economic impact of a closure or downsizing of a private-sector entity by making necessary improvements to building and infrastructure—will be eligible under the Site and Building Development Fund.

The bill passed on a 46-0 vote and takes effect immediately.

A bill intended to provide clarity in the event of a municipal bankruptcy in Nebraska remains on select file.

LB67, sponsored by Columbus Sen. Paul Schumacher, would create a statutory lien on government bonds in order to ensure bondholder priority in bankruptcy proceedings.

Exempt would be retirement accounts, pension funds and any other vested post-employment benefit whenever payable.

Finally, a bill that would offer grants to small businesses that create additional jobs in Nebraska remains in committee.

Introduced by Ogallala Sen. Ken Schilz, LB395 would create a nine-member Nebraska Enterprise Fund Authority within the state Department of Economic Development. The authority would award grants to businesses for recruitment, relocation, capital improvement and infrastructure development.

Grants would be awarded based on potential economic impact and number of jobs created by the business. Businesses with fewer than 100 employees would be prioritized for the program.

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