Lance Surety Bond Associates, Inc.

Debt Settlement Service Providers:

Under this bill debt settlement service providers will be regulated to where registration is required along with a surety bond if the provider has any consumer deposit funds in an account to be used for the payment of debt settlement fees and/or for making payments to debt collections/creditors. The new bonding requirement will have to be in the minimum amount of $10,000 for the first three months of the registration period, after which it will have to be in the amount no less than the average of the balance held in the provider’s dedicated consumer accounts during the previous three months. This bond will not be allowed to be any less than $10,000 or larger than $1 million. This bond must be issued by a surety agency licensed in that particular state and it must be in compliance with the appropriate state and federal laws/regulations.

License Bond – Towing Companies

The purpose of SB 570 would be to repeal the bond requirement for towing companies that tow vehicles from parking lots. Under current law a $20,000 bond must be posted to guarantee the payment of any liability incurred under the law.

SB 2913/AB 4298: License Bond – Mobility Dealers

Mobility dealers would be subjected to existing licensing and bond requirements for motor vehicle dealers. Anyone who sells more than five mobility vehicles in a year is considered a Mobility dealer. These vehicles are specially equipped to transport a person with a disability and include mechanical devices such as a wheel chair or ramps. Under current law a 10K bond must be posed by motor vehicle dealers if they sold less than 200 vehicles in a calendar year. A 25K will be required if the dealer sells more than 200 vehicles in a calendar year.

This house bill will rewrite the existing law for wholesale potato dealers. Under current law the dealers must be licensed, and a form of financial security is sometimes required by the State Seed Commissioner. A surety bond is an example of a financial security accepted by the State Seed Commissioner. The new bill will make the financial security requirement mandatory as a condition of licensure instead.

A bond would be required to be posted in connection with review processes for tax assessments made by local authorities on the sale of tickets for sporting events. Vendors selling the tickets would be responsible for the tax. If there are disputes against the tax or people seek a refund will be required to deposit an amount equal to the tax and any penalties due, along with a surety bond for the costs of the proceeding. The surety bond company must be licensed in that particular state as well.

HB 313: License Bond – Debt Management Services

The Uniform Debt Management Services Act of the National Conference of Commissioners of Uniform State law will be adopted through this bill. A $50,000 surety bond will be required to be posted by debt management service providers. Sureties will be required to be “A” rated by this bill from a nationally recognized rating service and licensed in that state.

A program will be established through SB 398 to provide scholarships to special needs students to attend qualified public and non-public schools. Scholarship granting organizations would then be required to demonstrate their financial viability if they have been receiving more than $50,000 in donations during the school year. This can either be shown through the submission of financial information demonstrating such viability or they will be allowed to post a surety bond. The surety bond that would need to be posted must be in equal to the aggregate amount of contributions that the school expecting to receive during the school year. A bond will also be required by SB 433 from scholarship organizations as described above, but the program is for low-income students.

Debt management service providers will be regulated by this bill. This would require licensure and a $50,000 surety bond to be posted. The Commissioner of the Department of Financial Institutions will be allowed to require a larger bond through regulations of this bill.

This bond would establish a permit system for intercity bus passenger services. This would be installed in cities that have a population of one million or more. A surety bond in the amount of $5,000 would be required in connection with the permit. The bond would be posted to ensure the payment of all civil penalties imposed on the permitted for violations of any permit requirements or restrictions.

The Commissioner of Financial Institutions will now be allowed to increase the $20,000 license bond that is required under existing law for collection agencies. The bond increase will be at the Commissioner’s discretion and is based on his or her determination that would protect the public’s interest. Also under this bill a minimum net worth requirement of $25,000 will be added.