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S. B. No. 247 As IntroducedAs Introduced
127th General Assembly | Regular Session | 2007-2008 |
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Cosponsors:
Senators Grendell, Seitz, Padgett, Schuring, Buehrer, Mumper, Cates, Roberts, Cafaro, Kearney, Morano
A BILL
To amend sections 926.29, 1733.13, 1733.15, 1733.19,
1733.329, and 1733.34 and to enact sections
1733.241, 1733.242, 1733.243, and 1733.291 of the
Revised Code relative
to changes in the Credit
Union Regulation Law.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:
Section 1. That sections 926.29, 1733.13, 1733.15, 1733.19,
1733.329, and 1733.34 be amended and sections 1733.241, 1733.242,
1733.243, and
1733.291 of the Revised Code be enacted to read as
follows:
Sec. 926.29. (A) A delayed price agreement is an
executory
contract that shall be in such a form and
contain such
terms as
the director of agriculture shall adopt by rule under
Chapter 119.
of the Revised Code. The agreement shall be
executed by and
between the licensed handler and the depositor or
by their
authorized representatives not later than fifteen days
after the
first delivery of an agricultural commodity is received
for
delayed pricing under the agreement. The handler shall
maintain a
file of executed agreements that are available for
inspection at
any reasonable time by the director or the
director's
designated
representative. The handler also shall keep
records
and ledgers
the director considers necessary to document the
handler's
obligation to the depositor under a delayed price
agreement. The
handler also shall provide
reports, forms, and other
evidence the
director shall adopt by rule to document the storage
and marketing
of commodities under the delayed price agreement.
(B) Subject to the lien that attaches under section 926.021
of the Revised Code and except as otherwise provided in division
(C) of this
section, a licensed handler who purchases any
agricultural
commodity under a delayed price agreement at all
times shall
maintain the commodity, rights in the commodity,
proceeds from
the sale of the commodity, or a combination of the
commodity,
rights, and proceeds equal to at least ninety per cent
of the
value of the handler's obligation for all commodities that
the handler has purchased
that are not priced under delayed price
agreements. The
obligation shall be secured or represented by one
or more of the
following:
(1) Maintenance of the commodity in storage in the
handler's
warehouse;
(2) Rights in commodities as evidenced by a receipt or
ticket
for storage of the commodities under a bailment agreement
in
another warehouse approved by the director;
(3) Proceeds from the sale of commodities as evidenced or
represented by one or more of the following:
(a) Cash on hand or held on account in a state or
federally
licensed financial institution or a lending agency of
the farm
credit administration;
(b) Short-term investments held in time accounts with
state
or federally licensed financial institutions or a lending
agency
of the farm credit administration;
(c) Balances in commodity margin accounts;
(d) Commodities sold and shipped by the handler under
delayed
price agreements that have not been priced less any
payments or
advances that have been received by the handler;
(e) Such other evidence of unencumbered assets as may be
acceptable to the director, including an irrevocable letter of
credit.
(C) In addition to the lien that attaches under section
926.021
of the Revised Code, a depositor who sells an agricultural
commodity to a
licensed handler under a delayed price agreement,
upon giving
notice to the handler either at or prior to the time
of delivery,
may demand as security for payment for the commodity
an amount that,
at the time of delivery, is equal to one hundred
per cent of the
national loan rate value of the commodity under
the United States
department of agriculture price support program,
or seventy-five
per cent of the average price being paid for the
commodity in the
state on the date of demand as published by the
market news
service of the department of agriculture, whichever is
less. The
handler shall satisfy a demand for security on a
commodity sold
under a delayed price agreement at the handler's
option by one of
the following:
(1) Payment to the depositor by cash or bank draft on the
account of the handler;
(2) Causing an irrevocable letter of credit to be issued
to
the depositor by a bank financial institution designated by the
handler securing
payment in the specified amount. The letter of
credit shall be
subject to Chapter 1305. of the Revised Code and
rules adopted by
the director pursuant to Chapter 119. of the
Revised Code.
Sec. 1733.13. (A) Each voting member present in person,
by
proxy, or by mail ballot is entitled to cast one vote,
irrespective of the number of shares he the member owns, on each
matter
properly submitted to the members for their vote, consent,
waiver, release, or other action.
(B) The chairman chairperson of the board, the president, any
vice-president, secretary, or treasurer of any association member
of the credit union shall conclusively be presumed to have
authority to cast the vote of such association member and to
appoint proxies and execute consents, waivers, releases, on its
behalf, unless before a vote is taken or a consent, waiver, or
release is acted upon, it appears by a certified copy of the code
of regulations, bylaws, or a resolution of the trustees,
directors, or executive committee of the said association member,
that such authority does not exist or is vested in some other
officer or person. For the purposes of this section, a person
exercising such authority as such officer is prima-facie to be
considered duly elected, qualified, and acting as such officer.
(C) If the articles or regulations so provide, any person,
who is entitled to attend a members' meeting to vote thereat, or
to execute consents, waivers, or releases, may:
(1) Vote thereat, and execute consents, waivers, and
releases, and exercise any of his the person's other rights, by
mail ballot
delivered to the office of the credit union at least
seven days
prior to the date set for the meeting. At least thirty
days'
notice shall be given to all eligible members of the date
set for
such meeting. No mail ballot shall be valid after the
expiration
of eleven months after delivery to the credit union.
The form of
any mail ballot must shall comply with criteria
established by the superintendent or have the prior written
approval of the
superintendent of credit unions.
(2) Be represented at such meeting or vote thereat, and
execute consents, waivers, and releases, and exercise any of his
the
person's
other rights, by proxy or proxies appointed by a
writing signed
by such person. No appointment of a proxy shall be
valid after
the expiration of eleven months after it is made. The
form of
any proxy must shall comply with criteria established by
the superintendent or have the prior written approval of the
superintendent.
Sec. 1733.15. (A) Except as otherwise provided by law,
the
articles, or regulations, the corporate powers of a credit
union
shall be exercised, its business conducted, and its
property
controlled by a board of directors, provided that the
number of
directors fixed by the articles or regulations shall
not be less
than five.
(B) All directors shall be voting members of the credit
union.
(C) The articles or regulations may divide directors into
two
or more classes whose terms of office shall expire at
different
times and may fix the term of office of the directors
or of any
class of directors at not more than three years from
the date of
their election.
(D) For their own government, the directors may adopt or
amend bylaws or adopt amended bylaws not inconsistent with the
articles or regulations.
(E) In discharging his official duties, a director may, when
acting
with reasonable care and in good faith, rely upon the books
and
records of the credit union, upon reports made to the credit
union by an officer or employee or by any other person selected
for the purpose with reasonable care by the credit union, and
upon
financial statements or written reports prepared by an
officer or
employee of the credit union in charge of its accounts
or
certified by a public accountant or firm of public
accountants.
(F) A credit union shall not elect or appoint a person to
its
board of directors who is presently serving as a director of
another credit union, unless either of the following conditions
has been met:
(1) If the person presently serves on the board of
directors
of a credit union having assets of less than five
million dollars,
the credit union, prior to retaining the
person's services,
notifies the superintendent of credit unions
in writing of the
person's candidacy or appointment as a
director.
(2) If the person presently serves on the board of
directors
of a credit union having assets of five million dollars
or more,
the superintendent has approved the person's candidacy
or
appointment.
(G) If the number of candidates for the board of directors
does not exceed the number of director positions being elected,
those candidates shall be deemed elected and shall serve as set
forth in the articles or regulations.
Sec. 1733.19. (A) The regulations may provide for the
creation by the directors of an executive committee consisting of
not less than three directors, and may authorize the delegation
to
any such committee of any of the authority of directors other
than
any action requiring more than a majority vote of the board
of
directors; provided, that the executive committee shall
exercise
only such authority in the interim between the meetings
of the
board and shall make a full report of, and the board shall
review,
all actions taken at any meeting of such committee at the
next
regular meeting of the board of directors following the
meeting of
the executive committee.
(B) Unless the articles or regulations provide a different
method for the establishment of a supervisory audit committee,
the
board of directors shall appoint a supervisory audit
committee of
not less than three individual voting members for
such term as is
provided in the regulations. The committee shall
audit the books
of the credit union at least annually, using
generally accepted
auditing procedures and standards, and shall
report its findings
to the board. Under the supervision of the
supervisory audit
committee, accounts showing installment
payments by members upon
shares of the credit union shall be
verified at least annually.
(C) In lieu of the appointment of a supervisory audit
committee as provided in division (B) of this section, the board
of directors may employ a public accountant or a firm of public
accountants to perform the functions of a supervisory audit
committee. The board of directors may appoint an audit committee
to oversee the public accountant or firm of public accountants.
(D) The superintendent of credit unions may require at any
time that a credit union have its accounts audited in accordance
with generally accepted auditing standards by an outside auditor.
The outside auditor shall be retained, and expense of any such
audit shall be paid, by the credit union.
(E) Unless the articles or regulations provide for the
appointment of loan officers in lieu of a credit committee, the
board of directors shall appoint, or the members shall elect, a
credit committee composed of not less than three individual
voting
members, which committee shall have such powers in the
granting of
loans and the supervision of lending practices as
shall be
delegated to it by the articles, regulations, or
resolutions of
the board of directors. The credit committee
shall make regular
reports of their activities to the board of
directors, and the
board of directors shall review the reports.
(F) If the articles or regulations so provide, a credit
union
may establish an advisory board consisting of persons
selected by
the board of directors or their designee. Persons
serving on the
advisory board need not be members of the credit
union, they may
be paid per diem not exceeding thirty dollars per
day and expenses
for their services on such board, and their
duties shall be to
make recommendations on financial and policy
matters of the credit
union.
(G) A credit union may establish such other committee or
committees as shall be provided for in the articles, regulations,
bylaws, or by resolution of the board of directors.
Sec. 1733.241. (A) When a share, share account, or deposit
is made in the name of two or more persons, payable to either or
the survivor, the credit union may pay all of the share, share
account, deposit, any part of the share, share account, deposit,
or any interest earned on the share, share account, or deposit, to
either of the named persons, or the guardian of the estate of
either of the named persons, whether or not the other person is
living. The receipt or acquittance of the person paid is a
sufficient release and discharge of the credit union for any
payments made from the account to that person.
(B) A credit union may enter into a written contract with a
natural person for the proceeds of the person's shares, share
accounts, or deposits to be
payable on the death of that person
to another person or to any
entity or organization in accordance
with the terms, restrictions,
and limitations set forth in
sections 2131.10 and 2131.11 of the
Revised Code.
Sec. 1733.242. (A) On the terms and conditions the credit
union prescribes, a credit union may do all of the following:
(1) Provide safes, vaults, safe deposit boxes, night
depositories, and other secure receptacles for the uses, purposes,
and benefits of its members;
(2) Receive tangible property and evidence of tangible or
intangible property for safekeeping using the credit union's
safes, vaults, secure receptacles, or safekeeping system; the
safes, vaults, secure receptacles, or safekeeping system of
another credit union; or the safekeeping system of a safekeeping
agent or custodian.
(B)(1) A credit union may enter into an agreement to rent a
safe deposit box to a minor and accept the appointment of a minor
as agent or deputy on any deposit or safe deposit box by any
person, including a minor, maintaining the deposit or safe deposit
box.
(2) When a credit union enters into a safe deposit box rental
agreement with a minor pursuant to division (B)(1) of this
section, all of the following apply:
(a) The terms and conditions of the safe deposit box rental
agreement are binding on the minor the same as a person of legal
age who rents a safe deposit box.
(b) The relationship between the credit union and the minor
regarding the safe deposit box rental agreement is in all respects
the same as if the minor were a person of legal age.
(c) The credit union shall incur no liability for any
transaction regarding the safe deposit box solely because of doing
business with a minor.
(3) Nothing in divisions (B)(1) and (2) of this section shall
be construed to limit the parental rights provided under section
2111.08 of the Revised Code or to limit the rights of a guardian
appointed pursuant to Chapter 2111. of the Revised Code.
(C) The superintendent of financial institutions shall
promulgate rules to qualify a credit union, safekeeping agent, or
custodian that may receive from another credit union tangible
property and evidence of tangible or intangible property for
safekeeping pursuant to division (A) of this section.
Sec. 1733.243. If any claim is made to any share, share
account, deposit, safe deposit box, property held in safekeeping,
security, obligation, or other property in the credit union's
possession or control, in whole or in part, by any person,
including any member, depositor, individual, or group of
individuals, without clear authority to draw on or exercise any
right or control with respect to the property, the credit union is
not required to recognize the claim without one of the following:
(A) A court order, issued by a court of competent
jurisdiction and served on the credit union, enjoining or
restraining the credit union from taking any action with respect
to the property or instructing the credit union to pay the balance
of the account, provide access to the safe deposit box, or deliver
the property as provided in the order;
(B) A bond, provided by the person making the claim, in the
form and amount and with sureties satisfactory to the credit
union, indemnifying the credit union against any liabilities,
loss, and expenses the credit union might incur because of its
recognition of the claim or because of its refusal, due to the
claim, to honor or recognize any right with respect to the
property.
Sec. 1733.291. (A) Every credit union shall retain or
preserve the following credit union records and supporting
documents for only the following periods of time:
(a) Broker's confirmations, invoices, and statements relating
to security transactions of the credit union or for or with its
customers, after the date of transaction;
(b) Corporate resolutions, partnership authorizations, and
similar authorizations relating to closed accounts, loans that
have been paid, or other completed transactions, after the date of
closing, payment, or completion;
(c) Ledger records of safe deposit accounts, after the date
of last entry on the ledger;
(d) Night depository records, after the date of transaction;
(e) Records relating to closed Christmas club or similar
limited duration special purpose accounts, after the date of
closing;
(f) Records relating to customer collection accounts, after
the date of transaction;
(g) Stop payment orders, after the effective date;
(h) All records relating to closed consumer credit loans and
discounts, after the date of closing;
(i) Deposit tickets relating to demand deposit accounts,
after the date of deposit.
(a) Deposit and withdrawal tickets relating to open or closed
savings accounts, after the date of transaction;
(b) Individual ledger sheets or other records serving the
same purpose that show a zero balance and that relate to demand,
time, or savings deposit accounts, and safekeeping accounts, after
the date of last entry, or, where the ledger sheets or other
records show an open balance, after the date of transfer of the
amount of the balance to another ledger sheet or record;
(c) Official checks, drafts, money orders, and other
instruments for the payment of money issued by the credit union
and that have been canceled, after the date of issue;
(d) Records relating to closed escrow accounts, after the
date of closing;
(e) Records, other than corporate resolutions, partnership
authorizations, and similar authorizations relating to closed
loans and discounts other than consumer credit loans and
discounts, after the date of closing;
(f) Safe deposit access tickets and correspondence or
documents relating to access, after the date of transaction;
(g) Lease or contract records relating to closed safe deposit
accounts, after the date of closing;
(h) Signature cards relating to closed demand, savings, or
time accounts, closed safe deposit accounts, and closed
safekeeping accounts, after the date of closing;
(i) Undelivered statements for demand deposit, negotiable
order of withdrawal, savings, agency, brokerage, or other accounts
for which customer statements are prepared, and canceled checks or
other items, after the date of statement, provided the credit
union has attempted to send the statements and checks or other
items to its customer, has held them pursuant to the instructions
of or an agreement with its customer, or has made them available
to its customer.
(B) The superintendent of financial institutions may
designate a retention period of either one year or six years for
any record maintained by a credit union but not listed in division
(A) of this section. The credit union shall retain or preserve
records that are not listed in division (A) of this section and
for which the superintendent has not designated a retention period
for six years from the date of completion of the transaction to
which the record relates or, if the last entry has been
transferred to a new record showing the continuation of a
transaction not yet completed, from the date of the last entry.
(C) The requirements of divisions (A) and (B) of this section
may be complied with by the preservation of records in the manner
prescribed in section 1733.29 of the Revised Code.
(D) In construing the terms set forth in division (A) of this
section, reference may be made to general credit union usage.
(E) A credit union may dispose of any records that have been
retained or preserved for the period set forth in divisions (A)
and (B) of this section.
(F) Any action by or against a credit union based on, or the
determination of which would depend on, the contents of records
for which a period of retention or preservation is set forth in
divisions (A) and (B) of this section shall be brought within the
time for which the record must be retained or preserved.
(G) Where a record may be classified under either division
(A)(1) or (2) of this section, the credit union shall retain or
preserve the record for the period set forth in division (A)(2) of
this section.
Sec. 1733.329. (A) There is hereby created in the division
of
financial institutions the credit union council, which shall
consist of seven members. The deputy superintendent for credit
unions shall be a member of the council and its chairperson. The
governor, with the advice and consent of the senate, shall appoint
the remaining six members.
(B)(1) At least five of the six members appointed to the
council
shall have had credit union experience.
(2) At least four of the six members appointed to the council
shall be, at the time of appointment, individuals currently
engaged in
the exercise of duties, responsibilities, rights, and
powers of a
director or chief executive officer of a
state-chartered credit
union having its principal office in this
state and doing business
in this state pursuant to this chapter
under the authority of the
superintendent of financial
institutions.
(3) At least one of the six members appointed to the council
shall
be a director or chief executive officer of a
state-chartered, federally
insured credit union.
(4) At least one of the six members appointed to the council
shall
be a director or chief executive officer of a
state-chartered, privately
insured credit union.
(5) At least one of the six members appointed to the council
shall
be a director or chief executive officer of a
state-chartered credit
union with five thirty-five million dollars
or
less in assets.
(6) At least one of the six members appointed to the council
shall
be a director or chief executive officer of a
state-chartered credit
union with more than five fifty million
dollars in assets.
(C)(1) Initial appointments to the council shall be made
within
sixty days after the effective date of this section. Of the
initial appointments, two shall expire one year after the
effective date of this section, two shall expire two years after
the effective date of this section, and two shall expire three
years after the effective date of this section. Thereafter, terms
of office shall be for three years.
(2) Each member shall hold office from the date of
appointment
until the end of the term for which the member was
appointed. In the
case of a vacancy in the office of any member,
the governor shall
appoint a successor, who shall hold office for
the remainder of the
term for which the successor's predecessor
was appointed. Any
member shall continue in office subsequent to
the expiration date
of the member's term until the member's
successor takes office, or
until sixty days has elapsed, whichever
occurs first.
(3) If during a member's term on the council, the member
ceases to
be a director or chief executive officer of a credit
union as described
in divisions (B)(2) to (6) of this section for
a period exceeding
ninety days, the member shall be ineligible to
continue to serve as a member
of the council, and the member's
position on
the council shall be considered vacant.
(D) No person appointed as a member of the credit union
council
may serve more than two consecutive full terms. However, a
member may serve
two consecutive full terms following the
remainder
of a term for which the member was appointed to fill a
vacancy or
following any term for which the member was appointed
prior to the
effective date of this section.
(E)(1) The council shall hold regular meetings at the time
and
place it fixes, but at least once every six months, and shall
meet at any time
on call of the deputy superintendent to conduct
its business and to decide by vote of the members the location of
future meetings. Each member shall be provided with written
notice
of the time and location of each council meeting at least
two days
prior to the scheduled date of the meeting, unless the
council by
resolution provides for a shorter time. Four of the
members of the
council constitute a quorum to transact and vote
on all business
coming before the council.
(2) The council, by a majority vote of those present at a
meeting
at which there is a quorum, may adopt and amend bylaws and
rules the
council considers necessary and proper. The council
shall select one of
its members as secretary, who shall keep a
record of all its
proceedings.
(3) No member shall participate in a proceeding before the
council
involving any credit union of which the member is or was
at any
time in the preceding twelve months a member of the board
of
directors, an officer, an employee, or a shareholder. A member
may refrain from participating in the proceedings of the council
for any other cause the member considers sufficient.
(F) The members of the council shall receive no salary, but
their
expenses incurred in performance of their duties shall be
paid from funds
appropriated for that purpose.
(G) The governor may remove any of the six members appointed
to
the council whenever in the governor's judgment the public
interest requires removal. Upon removing a member of the council,
the governor shall file with the superintendent of financial
institutions a statement of the cause for the removal.
Sec. 1733.34. (A) Any credit union may, with the approval
of
the superintendent of credit unions, merge with any other
credit
union under the existing charter of the other credit
union,
pursuant to any plan approved by the board of directors of
each
credit union joining in the merger, and approved by
two-thirds a
majority of the members of each credit union represented at a
meeting of members in person, by ballot, or by proxy, duly called
for such purpose, at which a
minimum of ten per cent quorum of the
entire membership is present,
unless such meeting of members of
either credit union has been
waived by the superintendent. The
superintendent may waive the members vote if it is in the interest
of the members, credit union, or for any other reason the
superintendent deems proper. After such approval of the board
and
members of each credit union, the president or chairman
chairperson of
the board and secretary of each credit union shall
execute a
certificate of merger, which shall set forth all of the
following:
(1) The time and place of the meeting of the board of
directors at which the plan was agreed upon;
(2) The vote in favor of adoption of the plan;
(3) A copy of the resolution or other action by which the
plan was agreed upon;
(4) The time and place of the meeting of the members at
which
the plan agreed upon was approved;
(5) The vote by which the plan was approved by the
members.
(B) Such certificates and a copy of the plan of merger
agreed
upon shall be forwarded to the superintendent and, upon
approval,
returned to the merging credit unions.
(C) Upon any such merger so effected, all property,
property
rights, and interests of the merged credit unions shall
vest in
the surviving credit union without deed, endorsement, or
other
instrument of transfer, and all debts, obligations, and
liabilities of the merged credit unions shall be deemed to have
been assumed by the surviving credit union under whose charter
the
merger was effected.
(D) This section shall be construed, whenever possible, to
permit a credit union chartered under any other act to merge with
one chartered under this act.
(E) All persons and associations eligible for membership,
as
provided in section 1733.05 of the Revised Code, of both
credit
unions effecting a merger shall be deemed to have a common
bond of
association.
Section 2. That existing sections 926.29, 1733.13, 1733.15,
1733.19, 1733.329, and 1733.34 of the Revised Code are hereby
repealed.
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