Legislative Developments 2-05-2024

Legislative Developments 2-05-2024

Article 9 and lien-related legislation

Tennessee: Senate Bill 2110 was introduced on 1/29/2024 to amend the definition of “deposit account” in the state’s version of Uniform Commercial Code (UCC) § 9-102(a)(29). The new definition provides that the term does not include United States central bank digital currency. This appears to be similar to House Bill 1662, which was introduced last month.

Utah: Senate Bill 43, which would amend the state’s version of UCC § 9-513, passed the Senate on 1/31/2024. The amendment would add a new section that requires a filing office to send a notice to the secured party of record if the debtor files a termination statement.

Virginia: House Bill 414, which would prohibit a clerk of the circuit court from charging a separate fee for indexing a document that may serve as two or more instruments with independent legal purposes, passed the House on 2/1/2024. The prohibition would specifically apply to a record of mortgage effective as a financing statement under the state’s version of UCC § 9-502.

Other uniform laws legislation (includes the 2022 Amendments to the UCC with UCC Article 12-Controllable Electronic Records)

Arizona: Senate Bill 1497 was introduced on 1/29/2024 to (i) define “central bank digital currency” and what constitutes legal tender in the state; (ii) prohibit the use of central bank digital currency within the state; and (iii) amend the state’s version of UCC § 1-201 to exclude central bank digital currency from the definition of “money.” This appears similar to Senate Bill 1281, which was reported last week.

Kentucky: Senate Bill 155 was introduced on 1/31/2024 to enact the 2022 Amendments to the UCC, including UCC Article 12-Controllable Electronic Records, and related amendments.

Missouri: Senate Bill 1352 was introduced on 1/25/2024 to enact the 2022 Amendments to the UCC, including UCC Article 12-Controllable Electronic Records, and related amendments. The bill includes non-uniform provisions that add a definition for “central bank digital currency” and broadly excludes from the definition of “money” any electronic medium of exchange authorized or adopted by the government and central bank digital currency.

South Dakota: House Bill 1199 was introduced on 1/29/2024 to repeal portions of UCC Article 8. Specifically, the bill would delete portions of UCC § 8-110(a), all of § 8-110(e) regarding a security intermediary’s jurisdiction, and parts of § 8-511. The bill also amends cross references in § 9-305.

Tennessee: House Bill 2806 and Senate Bill 2640 were introduced on 1/31/2024 to increase the time period for providing notice of objection in the state’s version of UCC § 2-201(2) from 10 to 11 days.

Tennessee: Senate Bill 2219 was introduced on 1/30/2024 to amend the state’s version of UCC § 1-201. The amendment would add a definition for “central bank digital currency” and exclude central bank digital currency from the definition of “money.” This appears similar to House Bill 1901 and Senate Bill 1764.

Utah: House Bill 164, which would amend UCC Article 9 with respect to central bank digital currency, passed the House on 1/30/2024 and is now in the Senate. The bill would add a definition of “central bank digital currency” to UCC § 9-102 and exclude central bank digital currency from the definition of “money.” The bill would also provide that a central bank digital currency is not specie legal tender and is not legal tender in the state.

West Virginia: House Bill 4837, which would amend the state’s version of UCC § 3-118 so the statute of limitation for actions to enforce the obligation of a note reflects a bank’s duty to retain and produce records of such note, passed the House on 2/1/2024.

Emerging technology legislation (blockchain, distributed ledger technology, cryptocurrency, etc.)

Georgia: House Bill 1043 was introduced on 1/25/2024 to adopt the Blockchain Basics Act. This bill would (i) provide protections relating to the generation and use of virtual currency; (ii) exclude virtual currency mining activities from money transmission licensure requirements; (iii) prohibit government entities from impairing the use of virtual currency as a method of payment; (iii) provide that certain virtual currency mining activities are lawful; (iv) provide liability protections for persons engaged in such activities; (v) prohibit local governments from imposing certain restrictions on such activities; (vi) prohibit discriminatory electricity rates; and (vii) provide tax exclusions for certain equipment and activities.

Rhode Island: House Bill 7351 was introduced on 1/31/2024 to adopt the Rhode Island Economic Growth Blockchain Act. This bill would regulate virtual and digital assets and establish depository banks for these purposes. The bill appears to be the same as House Bill 5836 (2023) which carried over from the last session.  

Tennessee: House Bill 2309 was introduced on 1/29/2024 and Senate Bill 2370 on 1/30/2024 to adopt the Blockchain Basics Act. These bills would (i) authorize an individual to engage in home digital asset mining; (ii) exclude those engaged in home digital asset mining activities from money transmission licensure requirements; (iii) prohibit government entities from impairing the use of controllable electronic records; and (iv) prohibit government entities from imposing any additional tax, withholding, assessment, or charge on a controllable electronic record.

Business organization legislation

Arizona: Senate Bill 1542 was introduced on 1/29/2024 to (i) require the corporations commission to create a registry of all corporations and LLCs that own single family residential property in the state; and (ii) limit the number of single-family residential properties a corporation or LLC may own. See an additional entry under the real estate recording-related legislation section below for related provisions in the bill regarding deeds and recording requirements.

Rhode Island: House Bill 7280 was introduced on 1/26/2024 to make numerous technical amendments to the statutes on taxes and corporations, associations, and partnerships.

Utah: House Bill 318, which would amend the Decentralized Autonomous Organizations Act, passed the House on 1/31/2024. The amendments would provide that the Division of Corporations and Commercial Code does not issue a certificate of organization for such entities and modify the requirements for the name of such an organization.

Notary legislation

California: Assembly Bill 2004 was introduced on 1/31/2024 to authorize a notary public to certify that a tangible copy of an electronic record is an accurate reproduction of the electronic record. The bill also requires a recorder to accept for recording a tangible copy of an electronic record that has been so certified by a notary public if specified requirements are met.

Georgia: House Bill 1075 was introduced on 1/29/2024 to require all state agencies to accept notarial acts performed in other states if certain conditions are met.

Georgia: Senate Bill 425 was introduced on 1/29/2024 to provide for the modernization of notary services, including in-person electronic notarization and remote notarization.

Hawaii: Senate Bill 2816 was introduced on 1/23/2024 to provide that the lieutenant governor shall charge a fee for each apostille or non-apostille certification issued. This appears to be the same as House Bill 2480, which was reported last week.

New Mexico: House Bill 263 was introduced on 1/26/2024 to increase the maximum fees that a notary may charge.

South Dakota: Senate Bill 211 was introduced on 1/31/2024 to amend notary law to authorize and set the requirements for electronic and remote notarial acts.

West Virginia: House Bill 5332 was introduced on 1/29/2024 to exempt certain existing commissioned notaries from the high school diploma requirement. The bill passed the House on 2/1/2024 and is now pending in the Senate.

Real estate recording-related legislation

Arizona: House Bill 2754 was introduced on 2/1/2024 to require an individual who presents a document for recording to provide the recorder with two valid forms of identification.

Arizona: Senate Bill 1542, noted under the Business Organizations section above, also would establish content requirements for deeds evidencing the purchase of single family residential property by a corporation or LLC and provide that a county recorder may not record a deed for the purchase of single family residential property by a corporation or LLC unless the deed contains the ownership information about the corporation or LLC that is in the corporations commission registry.

California: Assembly Bill 2004 (see Notary section above) would require a recorder to accept for recording a tangible copy of an electronic record that has been certified by a notary public.

Indiana: House Bill 1222 was introduced on 1/29/2024 to prohibit the recording of residential real estate service agreements. The bill promptly passed the House on 2/1/2024 and is now in the Senate.

Maryland: House Bill 638 was introduced on 1/25/2024 to modify the state realty transfer tax rate.

Missouri: House Bill 2604 was introduced on 1/31/2024 to adopt the Uniform Real Property Electronic Recording Act.

New Jersey: Assembly Bill 3405 was introduced on 2/1/2024 to eliminate the general purpose, supplemental, and mansion realty transfer fees. This appears to be the same as Senate Bill 535, which was introduced last month.

New Jersey: Assembly Bill 3423 was introduced on 2/1/2024 to establish certain protections against deed theft. The bill text is not yet available to provide the details of such protections.

New York: Senate Bill 8399 was introduced on 1/26/2024 to prohibit the recording of a conveyance that the clerk or register has reason to believe is false or fraudulent in any manner.

Rhode Island: House Bill 7410 was introduced on 1/31/2024 to prohibit cities and towns from charging subscription or access fees for public access to recorded real estate instruments and limit the recording and copying fees of those instruments to the amounts already set forth in statute. The bill would also restrict third-party providers of online or electronic public access from charging fees in excess of the amounts provided in the statute.  

Tennessee: House Bill 2271 was introduced on 1/26/2024 and Senate Bill 2313 on 1/30/2024 to require county register of deeds to send a notice to the person who last paid taxes on the property subject to the recording of a quitclaim deed.

Tennessee: Senate Bill 2448 was introduced on 1/30/2024 to address real estate recording. This bill would require county registers of deeds and notaries public to verify the identity of a person recording or notarizing a document relating to certain real estate transactions using a government-issued identification card. The bill would also require such registers and notaries to document and maintain as a permanent record certain personally identifying information of a person recording or notarizing such a document. In addition, the bill specifies penalties for violations by a notary public. This appears similar to House Bill 2215, which was introduced last week.

Utah: Senate Bill 165 was introduced on 1/29/2024 to require that a county maintain a system for a property owner to elect to receive electronic notification when the county recorder records a deed or a mortgage on the owner’s property.

West Virginia: House Bill 5326 was introduced on 1/29/2024 to prohibit unfair real estate service agreements, prohibit recording of such agreements, and allow a county recorder to refuse to record such unfair service agreements.

Other items and legislation of interest

West Virginia: House Bill 5338 was introduced on 1/29/2024 to create the Consumer Data Protection Act.

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Note that this update provides only a short summary of the listed bills, which are often lengthy and complex. It is not intended to include all potentially relevant provisions of each bill. For full details, please review the bill on the applicable state legislative web site.