State of Illinois
92nd General Assembly

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 1                       HOUSE JOINT RESOLUTION

 2        WHEREAS,  Public  Act  91-698,  effective  May  6,  2000,
 3    amended the Sales Finance Agency Act (205 ILCS 660)  and  the
 4    Consumer Installment Loan Act (205 ILCS 670) to authorize the
 5    Department of Financial Institutions to adopt rules necessary
 6    for the protection of consumers in Illinois; and

 7        WHEREAS,   The   Department   of  Financial  Institutions
 8    proposed rules titled "Consumer Installment Loan Act" (38 Ill
 9    Adm Code 110) on August  11,  2000  at  24  Ill.  Reg.  11717
10    regulating loans with annual interest rates exceeding 36% for
11    periods  of  less  than  60 days, if secured by an automobile
12    title, or for periods of less than 30 days, if not secured by
13    a title; and

14        WHEREAS, Among other provisions, the  Department's  rules
15    limit  lenders  of these short-term loans to simple interest,
16    require  lenders  to  provide  applicants  and  debtors  with
17    information about debt management services,  require  release
18    of  any  liens  within  24  hours  after a short-term loan is
19    repaid, and require lenders to verify that a borrower has not
20    received another short-term loan within the previous 15 days;
21    and

22        WHEREAS,  The  Department   of   Financial   Institutions
23    submitted its proposed rules on October 17, 2000 to the Joint
24    Committee  on  Administrative Rules, which reviewed the rules
25    and issued a Statement of Objection; and

26        WHEREAS, The  Joint  Committee  on  Administrative  Rules
27    found  that the proposed rules constitute a serious threat to
28    public  interest,  safety,  or  welfare,   and   the   filing
29    prohibition  gives the agency an opportunity to revisit those
30    provisions and consider less onerous alternatives; and

31        WHEREAS, Citing public comment, the  Joint  Committee  on
                            -2-                LRB9208515JSpc
 1    Administrative Rules noted that the proposed rules present an
 2    unreasonable  economic burden to small lenders, which in turn
 3    may diminish the  availability  of  financial  resources  for
 4    consumers with limited options; and

 5        WHEREAS, Based on this determination, the Joint Committee
 6    on Administrative Rules prohibited the above-cited rulemaking
 7    at its meeting on November 29, 2000; and

 8        WHEREAS,   Because   Section   5-115   of   the  Illinois
 9    Administrative Procedure Act states that a Prohibition of  an
10    agency's  proposed rule is effective for a period of at least
11    180 days, the Prohibition issued by JCAR  commenced  November
12    30, 2000 and will terminate on May 28, 2001, unless continued
13    by  adoption  of  this Joint Resolution by both houses of the
14    General Assembly as  provided  by  Section  5-125(c)  of  the
15    Illinois Administrative Procedure Act; and

16        WHEREAS,  The  General  Assembly may permanently prohibit
17    filing  of  these  rules  by  joint  resolution  before   the
18    conclusion  of  that  180-day  period, as further provided in
19    Section 5-115 of the Illinois Administrative  Procedure  Act;
20    therefore, be it

23    SENATE  CONCURRING  HEREIN, that the Prohibition by the Joint
24    Committee on Administrative Rules of the  rules  proposed  by
25    the  Department  of  Financial  Institutions under Public Act
26    91-698 and initially published in the  Illinois  Register  on
27    August 11, 2000 be continued; and be it further

28        RESOLVED,  That copies of this resolution be forwarded to
29    the  Executive   Director   of   the   Joint   Committee   on
30    Administrative   Rules   and   the   Director   of  Financial
31    Institutions.

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