87R7862 JES-F     By: Deshotel H.B. No. 3472       A BILL TO BE ENTITLED   AN ACT   relating to the investment and use of excess residential mortgage   loan originator recovery fund fees; changing a fee.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Sections 156.501(b) and (c), Finance Code, are   amended to read as follows:          (b)  Subject to this subsection and Section 156.502(b), the   recovery fund shall be used to reimburse residential mortgage loan   applicants for actual damages incurred because of acts committed by   a residential mortgage loan originator who was licensed under   Chapter 157 when the act was committed.  The use of the fund is   limited to reimbursement for out-of-pocket losses caused by an act   by a residential mortgage loan originator licensed under Chapter   157 that constitutes a violation of Section 157.024(a)(2), (3),   (5), (7), (8), (9), (10), (13), (16), (17), or (18) or 156.304(b).          (c)  Amounts in the recovery fund may be invested and   reinvested in accordance with Chapter 2256, Government Code, and   under the prudent person standard described in Section 11b, Article   VII, Texas Constitution [in the same manner as funds of the   Employees Retirement System of Texas], and the interest from these   investments shall be deposited to the credit of the fund. An   investment may not be made under this subsection if the investment   will impair the necessary liquidity required to satisfy claims   [judgment payments] awarded under this subchapter.          SECTION 2.  Section 156.502, Finance Code, is amended to   read as follows:          Sec. 156.502.  FUNDING. (a)  On an application for an   original license [or for renewal of a license] issued under Chapter   157, the applicant, in addition to paying the original application   fee [or renewal fee], shall pay a fee in the [an] amount of   [determined by the commissioner, not to exceed] $20.  The fee shall   be deposited in the recovery fund.          (b)  If the balance remaining in the recovery fund at the end   of a calendar year is more than $3.5 million, the amount of money in   excess of that amount shall be remitted by the commissioner to the   comptroller for deposit in the Texas Financial Education Endowment   account as provided by Section 393.628(c-1) [available to the   commissioner to offset the expenses of participating in and sharing   information with the Nationwide Mortgage Licensing System and   Registry in accordance with Chapter 180].          SECTION 3.  Section 157.013(b), Finance Code, is amended to   read as follows:          (b)  An application for a residential mortgage loan   originator license must be accompanied by:                (1)  an application fee in an amount determined by the   commissioner, not to exceed $500; and                (2)  for an original license, a recovery fund fee in the   [an] amount of [determined by the commissioner, not to exceed] $20.          SECTION 4.  Section 393.628, Finance Code, is amended by   amending Subsections (c) and (f) and adding Subsection (c-1) to   read as follows:          (c)  Except as provided by Subsection (c-1), the [The] Texas   Financial Education Endowment shall be administered by the finance   commission to support statewide financial education and consumer   credit building activities and programs, including:                (1)  production and dissemination of approved   financial education materials at licensed locations;                (2)  advertising, marketing, and public awareness   campaigns to improve the credit profiles and credit scores of   consumers in this state;                (3)  school and youth-based financial literacy and   capability;                (4)  credit building and credit repair;                (5)  financial coaching and consumer counseling;                (6)  bank account enrollment and incentives for   personal savings; and                (7)  other consumer financial education and   asset-building initiatives as considered appropriate by the   finance commission.          (c-1)  The comptroller shall deposit money remitted by the   savings and mortgage lending commissioner under Section 156.502(b)   into a subaccount of the Texas Financial Education Endowment   account.  Money in the subaccount must be segregated from the money   remitted to the comptroller under Subsection (b) and may only be   used for purposes authorized by this subsection. The finance   commission shall administer the money deposited to the subaccount   and with that money:                (1)  shall provide a grant in an amount of not less than   $100,000 each year to a statewide nonprofit organization that   supports organizations described by Section 156.202(a-1)(1) and   that are registered under Chapter 158 for the purposes of:                      (A)  servicing third-party mortgage loans;                      (B)  providing financial education to consumers   that relates to mortgage loans; and                      (C)  administering disaster repair programs for   consumers with mortgage loans;                (2)  shall provide support for statewide financial   education, activities, and programs specifically related to   mortgage loans for consumers, including activities and programs   described by Subsection (c);                (3)  if a governor's declaration of a state of disaster   under Section 418.014, Government Code, is in effect, may provide   direct mortgage assistance for residence homesteads, as defined by   Section 11.13, Tax Code, as needed due to the disaster; and                (4)  subject to the limits under Section 156.505, may   provide reimbursements to a residential mortgage loan applicant who   submits an application under Section 156.504 and who the   commissioner determines has a valid claim, unless the claim is   against a residential mortgage loan originator who conducted   activities requiring a license under this chapter without a license   under Chapter 157.          (f)  The finance commission shall adopt rules to administer   this section, including rules governing implementation of   Subsection (c-1)(1) that:                (1)  ensure a grant awarded under that subdivision is   used for a public purpose described by that subdivision; and                (2)  provide a means of recovering money awarded that   is not used in compliance with that subdivision.          SECTION 5.  Sections 156.501(d) and (f), Finance Code, are   repealed.          SECTION 6.  Section 156.501(c), Finance Code, as amended by   this Act, applies only to an investment made on or after the   effective date of this Act.  An investment made before the effective   date of this Act is governed by the law as it existed immediately   before that date, and that law is continued in effect for that   purpose.          SECTION 7.  This Act takes effect September 1, 2021.