STANDING COMMITTEE on COMMUNICATIONS, FINANCIAL SERVICES and INTERSTATE COMMERCE

COMMITTEE WORKBOOK

LEGISLATIVE SUMMIT AUGUST 6 – 9, 2012 CHICAGO, ILLINOIS STANDING COMMITTEE on COMMUNICATIONS, FINANCIAL SERVICES and INTERSTATE COMMERCE

TABLE of CONTENTS

COMMITTEE AGENDA…………………….…………………..…..3

COMMITTEE DESCRIPTION……………………………………..13

COMMITTEE OFFICERS AND STAFF CONTACTS…...... 14

COMMITTEE ROSTER…...... 16

RULES AND BYLAWS…….……………..……….….……...…...22

POLICY DIRECTIVES TRANSITION CHART…………...…………25

POLICY DIRECTIVES FOR CONSIDERATION…………………….26

Banking & Financial Services (p. 26) Corporate Formations (p. 33) Cradle to Grave Electronics Management (p.34) Insurance (p. 35) Internet & Electronic Commerce (p. 41) Remote Commerce (p. 47)

RESOLUTIONS FOR CONSIDERATION……………………..…...49

State Sovereignty in Online Gaming (p. 49) Supports and Urges Enactment of the Marketplace Fairness Act (p. 50) Supports Intellectual Property (IP) Rights and Protections to Promote Productivity, Competitiveness, Jobs, and Public Health (p. 52) Opposes Federal Contactless Technology Mandates For State Issued Identification Documents (p. 54) Support of State Public Affairs Networks (Memorial Resolution) (p. 57) 2012 NCSL Legislative Summit August 6-9, 2012 Chicago, Illinois

Communications, Financial Services and Interstate Commerce Committee Agenda Items in bold denote committee activities All sessions will be held in the McCormick Place Convention Center Co-Chairs: Staff Co-Chairs: Senator Carol Fukunaga, Hawaii Duncan Goss, Legislative Council, Representative Greg Wren, Alabama Vermont Patricia Murdo, Legislative Services Division, Montana

Vice Chairs: Staff Vice Chairs: Senator Thomas Alexander, South Carolina Karen Cochrane-Brown, Research Representative Wayne Harper, Utah Division, North Carolina Representative Ross Hunter, Washington Gary Schaefer, Senate, Louisiana Delegate Susan Lee, Delegate Joe May, Virginia Representative Chris Perone, Connecticut Past Chair: Past Staff Chair: Senator Delores Kelley, Maryland Melissa Calderwood, Legislative Research Department, Kansas Sunday, August 5, 2012 12:30 pm – 7:00 pm International Program 1:00 pm – 2:15 pm NCSL Executive Committee: Outreach and Communications W194b - Level 1 Subcommittee 2:00 pm – 5:00 pm Task Force on State & Local Taxation W192b - Level 1 Presiding: Senate Minority Caucus Whip Pamela Althoff, Illinois Delegate Sheila Ellis Hixson, Maryland 2:30 pm – 3:45 pm NCSL Executive Committee: Budget, Finance and Rules W194b - Level 1 Committee 4:00 pm – 5:30 pm Executive Committee W196a - Level 1 Monday, August 6, 2012 7:30 am – 5:30 pm Registration Registration B - Level 3 7:30 am – 1:00 pm Pre-Conferences, Task Forces, International Program, Ancillary

~ 3 ~ 8:00 am – 11:30 am Task Force on State & Local Taxation W179b - Level 1 Hear an update on the Marketplace Equity Act and the Marketplace Fairness Act, which would give states the authority to collect taxes owed on remote sales. Discuss deal- of-the-day vouchers, such as Groupon and LivingSocial, and what to be aware of when determining how to tax discounted products or services. Review a draft statement on principles states should consider when deciding to tax cloud computing services and discuss telecommunications tax reform in the states. Presiding: Senate Minority Caucus Whip Pamela J. Althoff, Illinois Delegate Sheila Ellis Hixson, Maryland 9:00 am – 12:00 noon Legislative Staff Coordinating Committee 10:30 am – 11:30 am Transforming Health Care Through Technology FSL W184ab - Level 1 Partners Project Business Meeting Members of the steering committee will review the accomplishments of this Foundation for State Legislatures’ Partners Project. Presiding: Senator Richard Moore, , NCSL Immediate Past President Senator Kemp Hannon, New York 11:45 am – 1: 15pm Mobile Health Technologies Working Lunch W184cd - Level 1 Joint with Transforming Health Care Through Technology Partners Project Learn about advancements in home health care and explore the ways that mobile technologies are revolutionizing how health care is delivered. Moderator: Senator Jeremy Nordquist, Nebraska Delegate Joe May, Virginia Speakers: Fred Castillo, Executive Director AT&T Government Education, and Medical Mobility Team, Illinois Chuck Davidson, Advanced Communications Law and Policy, New York 11:45 am – 1:15 pm Leveling the Playing Field for Retailers: Fixing a $23 W178ab - Level 1 Billion Loophole on Internet Sales Taxes Working Lunch Co-sponsored by the Task Force on State & Local Taxation NCSL gratefully acknowledges the International Council of Shopping Centers and the Retail Industry Leaders Association for supporting this luncheon session. Supreme Court decisions have limited states’ ability to collect taxes on online sales. In FY 2012 this amounted to around $23 billion. This also puts brick and mortar stores who must collect taxes at a disadvantage to their online competitors. Analyze two bills in Congress that would give states authority to collect these taxes and explore the

~ 4 ~ options states have to fix this loophole. Presiding: Senator Deb Peters, South Dakota Moderator: Joseph Crosby, Multistate Associates, Virginia Panelists: Representative John Otto, David Vite, IRMA, Illinois Adrielle Churchill, Office of Congressman Steve Womack Corey Tellez, Office of Senator Dick Durbin 12:30 pm – 1:15 pm New Attendee Orientation W176c - Level 1 If you are attending your first NCSL Legislative Summit, take part in this interactive orientation and learn how to navigate your way through the nation's most substantive public policy meeting. Learn about meetings that will get you more involved with NCSL, including our business meeting, staff sections, standing committees and more. 1:30 pm – 3:00 pm General Session: Diane Swonk Skyline Ballroom - Level 3 Diane Swonk, chief economist for Mesirow Financial has been named one of the top economic forecasters in the country by the Wall Street Journal. She acts as advisor to Federal Reserve Board and regional Reserve Banks, and is one of the most respected economists in the world and among the most quoted economists in the financial press. 3:15 pm – 5:00 pm Identity Theft and Privacy in the Online Age W184ab - Level 1 Computers and the internet continue to change the way we conduct business, govern and interact with one another. State and federal policymakers grapple with the issues of identity theft and the privacy of online information. Hear about the current state of digital information and examine what issues state lawmakers should be aware of. Moderators: Duncan Goss, Legislative Council, Vermont Karen Cochrane-Brown, Research Division, North Carolina Panelists: House Assistant Minority Leader James B. Durkin, Illinois Senator Delores Kelley, Maryland Senator Ellen Roberts, Senator Charleta B. Tavares, Ohio Justin Brookman, Center for Democracy & Technology, Washington, D.C. Jim Halpert, DLA Piper, Washington, D.C. 3:15 pm – 5:00 pm Staff Sections 5:15 pm – 6:15 pm Steering Committee Meeting W183a - Level 1 The steering committee includes the overall standing committee officers and the legislator and staff chairs of each standing committee. Members will preview policies for

~ 5 ~ consideration and decide on joint and re-referrals of policy resolutions as necessary. 5:00 pm – 7:00 pm American Financial Services Association’s Reception for Gino’s East of Chicago the Communications, Financial Services and Interstate Commerce Committee members Please RSVP by Friday, July 27, to Susan Sullivan at [email protected]. Tuesday, August 7, 2012 7:30 am – 5:30 pm Registration Registration B - Level 3 8:00 am – 8:45 am Staff Sections Prayer Breakfast 9:00 am – 10:15 am General Session: Peter Hart and Neil Newhouse Skyline Ballroom - Level 3 Peter Hart and Neil Newhouse are two of the nation's leading pollsters. Newhouse is a partner and co-founder of Public Opinion Strategies, a firm that The New York Times describes as "the leading Republican polling company" in the country. Peter Hart is "the foremost Washington pollster for the Democratic Party," according to the National Journal and is chairman of Peter D. Hart Research Associates. 10:30 am – 11:30 am CFI Committee Business Meeting W184ab - Level 1 Members of the committee will discuss and vote on committee business and consider and vote on any new policy resolutions submitted for consideration and review policies. Presiding: Senator Carol Fukunaga, Hawaii, CFI Co-Chair Representative Greg Wren, Alabama, CFI Co-Chair Duncan Goss, Vermont, CFI Staff Co-Chair Patricia Murdo, Montana CFI Staff Co-Chair 10:00 am – 4:00 pm Exhibit Hall Hall F1 - Level 3 11:45 am – 1:00 pm Insurance Fraud—If You Don’t Find It, You’re Not W184ab - Level 1 Looking Working Lunch Sponsored by the National Insurance Crime Bureau Hear how today’s insurance fraud crimes are much more pervasive than ever costing Americans an estimated $30 billion a year while fraud criminals ply their scams with relative impunity. Moderator: Senator Thomas Alexander, South Carolina Speaker: Joseph Wehrle, National Insurance Crime Bureau, Illinois 1:00 pm – 2:15 pm Revolutionizing Care Through Telehealth Technologies W184ab - Level 1 Joint with the Transforming Health Care Through Technology Project With an additional 32 million people estimated to gain health insurance coverage by 2014, states are looking for innovative ways to expand services to underserved and rural areas. Telehealth or telemedicine is emerging as a critical piece in the puzzle. Find out how states are working to

~ 6 ~ expand services and hear about state examples. Moderator: Representative Rosie Berger, Speakers: John D. Blum, John J. Waldon Research Professor of Law, Beazley Institute for Health Law and Policy, Loyola University Chicago School of Law, Illinois David Johnson, MD, Associate Professor of Pediatrics and Chief, Section of Academic Pediatrics, Comer Children’s Hospital, The University of Chicago Medicine, Illinois Tom Richards, MD, CEO, Apollo Telemedicine, Wyoming

1:30 pm – 2:45 pm Building a Better Public Safety Communications Network W184cd - Level 1 Joint with the Law and Criminal Justice Committee and Task Force on Homeland Security and Emergency Preparedness Recently approved federal legislation reallocates spectrum and provides funding for states to move forward with the construction of a nationwide interoperable broadband network for first responders. Learn about the nationwide broadband network and important next steps for states. Moderator: Senator Denton Darrington, Idaho Speakers: Anna Gomez, Deputy Assistant Secretary, NTIA Michael Balboni, GNYHCFA, New York Jeffrey Cohen, Law and Policy, APCO International, Virginia 2:15 pm – 3:30 pm Dodd-Frank and the States W184ab - Level 1 States play a significant role in the regulation of financial services. This authority relies on the preservation of a dual- banking system, state regulation of insurance and a state- federal partnership in securities regulation authority. Several provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act, signed into law two years ago, are impacting the regulation of banking and insurance in the states. Discuss these relationships and explore how implementation of Dodd-Frank is shaping states’ responsibilities and authority. Moderator: Representative Greg Wren, Alabama Patricia Murdo, Legislative Services Division, Montana

3:15 pm – 4:45pm Legislative Staff University: Laree Kiely W470ab - Level 4 Laree Kiely is an award-winning organizational expert, consultant, educator, and founder of the Kiely Group.

~ 7 ~ 3:30 pm – 4:30 pm The Changing Telecommunications Landscape W184ab – Level 1 Consumers now have a growing number of choices when selecting communications services. With new options available, several states have considered or enacted legislation to deregulate some services. Legislators and other experts will discuss recent initiatives and what the future holds. Moderators: Senator Curtis S. Bramble, Utah House Deputy Majority Leader Chris Perone , Connecticut Speakers: Representative Darryl M. Scott, Delaware Representative Mike Hill, Alabama Chuck Davidson, Advanced Communications Law and Policy, New York Sherry Lichtenberg, National Regulatory Research Institute, Maryland 4:45 pm – 5:45 pm Steering Committee W183a - Level 1 The steering committee will review the policies reported from the standing committees at the Forum and determine the calendar for the NCSL Business Meeting on Thursday, August 9, at 10:30 am. 4:45 pm – 5:45 pm Legislating in the Cloud W184cd - Level 1 Cloud computing makes it easier to get, store and deliver software and services through the Internet. It also has the potential for saving costs. Learn about cloud computing and discuss the pros and cons, including questions about confidentiality, security and ownership of data. Hear about other state experiences in taking the leap to the cloud. Moderator: Gary Wieman, Legislative Technology Center, Nebraska Panelists: Sharon Crouch Steidel, Virginia House of Delegates Eric Dugger, Legislative Counsel Bureau, Nevada Legislature Jonathan Palmore, Senate Information Systems, Virginia General Assembly 4:45 pm – 5:45 pm Young Professionals’ Networking Reception Rooftop Garden - Level 5 Join your legislative colleagues for some light appetizers, a drink and a chance to get to know one another at the Convention Center. Hear about the NCSL staff sections available to you, which are professional groups organized around jobs responsibilities. 5:00 pm – 6:00 pm Women’s Legislative Network Reception Skyline Pre-function - Level 3 Join members of the network to honor incoming president Delaware Senator Dori Connor, the executive board, and female lawmakers from around the world.

~ 8 ~ 6:30 pm – 8:30 pm Social Event: Windy City Welcome Museum of Science and Chicago stands tall as the city of big shoulders—a city Industry known for its renowned architecture, captivating museums, beloved sports teams, wonderful shopping, great food and beautiful lake shore. At this opening event, you’ll have exclusive access to the largest science center in the Western Hemisphere and experience fascinating, world-class exhibits. During your exploration of the museum, you will get a ―taste‖ of what makes Chicago famous—food, fun and music. A traditional ―Taste of Chicago‖ will showcase all the famous eats and tunes from the Windy City, from deep dish pizza to the classic Chicago style hot dog, from jazz to gospel to rock. 8:30 pm – 11:00 pm CTIA-The Wireless Association’s Reception for the The Signature Room, Communications, Financial Services and Interstate Hancock Building Commerce Committee members Please RSVP by Monday, July 30, to [email protected]. Shuttle service will be provided from the Museum of Science and Industry. Wednesday, August 8, 2012 6:00 am – 7:30 am Bipartisan Bike Ride 7:30 am – 5:30 pm Registration Registration B - Level 3 8:00 am – 9:15 am Staff Section Breakfasts 9:30 am – 10:45 am Taxing the Cloud—Not a Weather Phenomenon (CLE) W180 - Level 1 The development of cloud computing and digital products has put state government in a fog. It is difficult for states to define what a digital product or service is, and whether or not to tax it. Although relatively new, cloud computing has changed the landscape of how businesses operate and has changed the way we live. You'll be able to clarify the hazy definition of "cloud" and explore how some states have taxed digital services and products. Moderator: Senator Deb Peters, South Dakota Panelists: Representative Ross Hunter, Washington Stephen Kranz, Sutherland Asbill & Brennan LLP, Washington, D.C. Scott Mackey, KSE FOCUS, Vermont Steve Pierce, AT&T, Illinois 10:00 am – 4:00 pm Exhibit Hall Hall F1 - Level 3 11:00 am – 12:15 pm Issue Forums 12:00 noon – 1:30 pm Atlanta Kick-off Lunch Hall F1 - Level 3 1:30 pm – 2:45 pm Placing Bets on Gaming: What's on the Screen? (CLE) W180 - Level 1 Some policymakers continue to consider legalized gaming a way to cash in on extra revenue. While states traditionally have determined regulation and taxation of the gaming industry, Congress has introduced legislation regarding ~ 9 ~ online gaming that may encroach upon the states' prerogative in this area. Explore state gaming developments, news regarding state legalization of online gaming and the possible fiscal and regulatory impacts on states if the federal bill is enacted. Moderator: Steve Rauschenberger, Rauschenberger Partners, LLC, Illinois Panelists: Margaret Defrancisco, North American Association of State and Provincial Lotteries, Ohio Frank Fahrenkopf, American Gaming Association, Washington, D.C. Professor I. Nelson Rose, Gambling and the Law, California 3:00 pm – 4:30 pm Salute to Legislative Staff: Strong Stewards W178ab - Level 1 Mary Crane is a nationally recognized speaker and trainer. She has been featured on "60 Minutes" and "Fox Business News," and her experience includes working in the White House. 3:00 pm – 5:00 pm Legislators Roundtable W184cd - Level 1 4:30 pm – 5:30 pm Social Media Safety W180 - Level 1 Social networking sites have created new security challenges in legislative and political realms. Hacking, high-jacking and impersonation happen too frequently. Hear about the security and privacy risks of social media, as well as some apps and location check-in tools, and learn some simple steps to keep your accounts secure. Moderator: Peter Capriglione, North Carolina General Assembly Speaker: Kevin Haley, Symantec, California States’ Night Thursday, August 9, 2012 6:00 am – 7:30 am Walk for Wellness Stretch your legs and join your friends at the Walk for Wellness, a 5K walk (or run) along Lake Michigan, to raise awareness of chronic diseases and health disparities. It’s open to all Summit attendees; no preregistration is required. The start/finish location is Arvey Field, near Lake Shore Drive and Roosevelt. 7:30 am – 9:00 am Online Reservations: A Breakfast on the State of Hotel W185d – Level 1 Taxation Co-sponsored by the Task Force on State & Local Taxation Recently, state and local governments around the country have filed law suits against online travel companies (OTCs) claiming they are in violation of hotel occupancy tax ordinances. The suits claim that taxes should be paid on the amount the consumer paid for the room, rather than on the rate the OTC negotiated with the hotel. The travel ~ 10 ~ companies contend that they neither operate hotels nor resell the rooms as wholesalers, placing them outside the scope of occupancy taxes. At this breakfast session, hear a discussion of online travel billing practices and how taxes are assessed, collected and remitted to the appropriate government agency. Moderator: Representative Brian Patrick Kennedy, Rhode Island Panelists: John Crongeyer, National Online Travel Litigation Group, Georgia Bob Finnell, National Online Travel Litigation Group, Georgia Joseph Henchman, The Tax Foundation, Washington, D.C. Cynthia Ohlenforst, K&L Gates LLP, Texas 7:30 am – 8:45 am NCSL Statehouse Ambassadors’ Breakfast W176b - Level 1 NCSL State Liaisons will have an opportunity to get to know their state’s NCSL Statehouse Ambassadors, who are legislative staff serving as in-state field representatives for NCSL. The Statehouse Ambassador program is designed to energize and sustain participation in NCSL and strengthen the organization’s role as an extension of state legislatures. 7:30 am – 12:00 noon Registration Registration B - Level 3 9:00 am – 10:15 am General Session on Jobs Skyline Ballroom - Level 3 John Engler, former Michigan governor and current head of the Business Roundtable, and Douglas Oberhelman, CEO of Caterpillar Inc., and Edward B. Rust Jr., CEO of State Farm Mutual and vice-chairman of the U.S. Chamber of Commerce, will participate in a lively discussion on the different roles government and businesses can play in creating jobs. 9:00 am – 12:00 noon Exhibit Hall Hall F1 - Level 3 10:30 am – 12:15 pm NCSL Annual Business Meeting W375e - Level 3 All legislators and legislative staff are urged to attend the Business Meeting for consideration of policy directives and resolutions that will guide NCSL’s advocacy efforts before Congress and the administration, amendments to the Bylaws and Rules of Procedures, election of NCSL officers and approval of the Conference budget. All other meeting participants are welcome to observe. 12:30 pm – 2:00 pm General Session: Doris Kearns Goodwin Skyline Ballroom - Level 3 Doris Kearns Goodwin, acclaimed historian, Pulitzer Prize winner, prolific author and captivating speaker, has written books on Franklin and Eleanor Roosevelt, the Fitzgeralds and the Kennedys, Lyndon Johnson and Abraham Lincoln. This year, she will be speaking on Teddy Roosevelt— legislator, president, bigger-than-life hero—and the leadership lessons we can learn from a time of economic and political turmoil that reverberate today.

~ 11 ~ 2:15 pm – 3:30 pm Issue Forums Staff Sections 3:30 pm – 4:45 pm Staff Sections 5:00 pm – 5:45 pm Ancillary 6:30 pm – 9:00 pm Social Event: Musical Feast Millennium Park What better way to say farewell to the City by the Lake than an evening of great music and fine food in this 25-acre park along Lake Michigan’s shoreline—a center for world-class art, music, architecture, gardens and landscape design? Guests will savor and sip some of Chicago’s best offerings from its many culturally diverse neighborhoods such as Greek Town, Little Italy and Ukrainian Village. While sitting under the stars, listen to an exclusive performance by the toddling town’s best-known musicians. Get ready for an evening of culinary and musical delights set against the picturesque skyline in one of the city’s top tourist attractions.

The NCSL Communications, Financial Services & Interstate Commerce Standing Committee will next meet during NCSL's Fall Forum to be held in Washington, D.C., December 5-7, 2012. Please plan to attend!

For additional information about the Committee, please contact: Heather Morton (303-856-1475 or [email protected]) Jo Anne Bourquard (303-856-1355 or [email protected]) James Ward (202-624-8683 or [email protected]) Max Behlke (202-624-3586 or [email protected])

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NATIONAL CONFERENCE OF STATE LEGISLATURES 2011 - 2012 STANDING COMMITTEE ON COMMUNICATIONS, FINANCIAL SERVICES & INTERSTATE COMMERCE

The NCSL Standing Committee on Communications, Financial Services and Interstate Commerce has jurisdiction over state-federal relations with regard to telecommunications, electronic commerce, banking and financial services, interstate commerce and taxation of electronic transactions, telecommunications and interstate business activity taxes. Upholding the sovereignty of the states to regulate intrastate telecommunications and oversee the deregulation and opening of local exchange markets to competition as well as advocate for regulatory parity of similar services delivered through different mediums are major state-federal regulatory and legislative concerns. The Committee also has responsibility to work with Congress and the Administration to avoid over regulation of the Internet and electronic commerce that could cause much harm to our nation’s own ability to compete globally while ensuring enhanced marketplace competition, increased consumer choice and security of personal information of consumers. The Communications, Financial Services and Interstate Commerce Committee will assume the jurisdiction over the following issues: regulation of financial services -- including banking, insurance and securities -- as well as community reinvestment, consumer protection, corporate governance, credit cards, credit unions, financial privacy, and natural disaster insurance. Its members have a keen interest in upholding state authority to regulate financial services and to protect financial consumers. Specific issues include supporting states' role as the sole regulator of the business of insurance, preserving the dual banking system, and opposing efforts to weaken state authority to protect individual investors and impose remedies to correct fraudulent activity by securities analysts.

Issues within the Committee’s Jurisdiction: Banks & Banking Information technology and policy Broadband Technologies Insurance Business Activity Taxes Insurance Fraud Cable TV Regulation Insurance Redlining Community Reinvestment Act Insurance Solvency/State Guaranty Funds Computer and Information Systems Internet Gaming Consumer Affairs Internet and Electronic Privacy Content Regulation Internet Regulation Credit Cards & Bureaus Internet Tax Credit Unions Interstate Commerce Dual Banking System Natural Disaster Insurance Dual Chartering of Insurance Securities Electronic Commerce Spectrum Allocation Electronic Commerce Sales Tax State Internet Networks Electronic Government State Telecommunications Networks Electronic Records and Information Telecommunications Financial Institutions Telecommunications Taxes Financial Privacy Wireless Communications

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National Conference of State Legislatures Communications, Financial Services and Interstate Commerce Committee 2011-2012 Officer Directory Co-Chairs

Sen. Carol Fukunaga, Hawaii Rep. Greg Wren, Alabama State Capitol, Room 216 Alabama State House, Room 517-B 415 South Beretania Street 11 South Union Street Honolulu, HI 96813 Montgomery, AL 36130 Phone: (808) 586-6890 Phone: (334) 242-7764 Fax: (808) 586-6899 Fax: (334) 242-4015 [email protected] [email protected]

Staff Co-Chairs

Duncan Goss, Vermont Patricia Murdo, Montana Vermont General Assembly Montana Legislature 115 State St. State House PO Box 201706 Montpellier, VT 05633-5301 Helena, MT 59620-1706 Phone: (802) 828-2231 Phone: (406) 444-3594 Fax: (802) 828-2424 Fax: (406) 444-3036 [email protected] [email protected]

Vice Chairs

Sen. Thomas C. Alexander, South Carolina Rep. Wayne Harper, Utah State House State Capitol, Suite 350 PO Box 142 350 North State Street Columbia, SC 29202-0142 Salt Lake City, UT 84114 Phone: (803) 212-6220 Phone: (801) 538-1029 Fax: (803) 212-6299 Fax: (801) 326-1544 [email protected] [email protected]

Rep. Ross Hunter, Washington Del. Susan C. Lee, Maryland John L O’Brien Building Lowe House Office Building, Room 414 P.O. Box 40600 6 Bladen Street Olympia, WA 98504-0600 Annapolis, MD 21401-1912 Phone: (360) 786-7936 Phone: (410) 841-3649 Fax: (360) 786-1066 Fax: (410) 841-3424 [email protected] [email protected]

Del. Joe T. May, Virginia Rep. Chris Perone, Connecticut General Assembly Building Legislative Office Building, Room 4023 PO Box 406 300 Capitol Avenue Richmond, VA 23218 Hartford, CT 06106-1591 Phone: (804) 698-1033 Phone: (860) 240-8585 Fax: (804) 698-6733 Fax: (860) 240-0067 [email protected] [email protected] ~ 14 ~ Staff Vice Chairs

Karen Cochrane-Brown Gary Schaefer, Louisiana North Carolina General Assembly Louisiana Legislature 300 N. Salisbury St. – 545 LOB PO Box 94183 Raleigh, NC 27603 Baton Rouge, LA 70804-9183 Phone: (919) 733-2578 Phone: (225) 342-1001 Fax: (919) 733-5460 Fax: (225) 342-9736 [email protected] [email protected]

Immediate Past Chair Immediate Past Staff Chair

Sen. Delores G. Kelley, Maryland Melissa Calderwood, Kansas James Senate Office Building, Room 302 Kansas Legislature, Room 68-W 11 Bladen Street 300 SW 10th Avenue Annapolis, MD 21401-1991 Topeka, KS 66612-1504 Phone: 410-841-3606 Phone: (785) 296-3181 Fax: 410-841-3399 Fax: (785) 296-3824 [email protected] [email protected]

NCSL Staff Contacts

Denver Office Washington, D.C. Office

Heather Morton James Ward Program Principal Committee Director Fiscal Affairs Program State-Federal Relations Division Phone: (303) 856-1475 Phone: (202) 624-8683 Fax: (303) 364-7700 Fax: (202) 737-1069 [email protected] [email protected]

Jo Anne Bourquard Max Behlke Senior Fellow Policy Specialist State Services Division State-Federal Relations Division Phone: (303) 856-1355 Phone: (202) 624-3586 Fax: (303) 364-7700 Fax: (202) 737-1069 [email protected] [email protected]

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NATIONAL CONFERENCE OF STATE LEGISLATURES 2011 - 2012 STANDING COMMITTEE ON COMMUNICATIONS, FINANCIAL SERVICES & INTERSTATE COMMERCE

Alabama Connecticut (continued) Rep. Steve Hurst, Republican Rep. Susan Johnson, Democrat Rep. Oliver Robinson, Democrat Sen. Rob Kane, Republican Rep. Greg Wren, Republican, Co-Chair Sen. Gary LeBeau, Democrat Sen. Carlo Leone, Democrat Alaska Schuyler Merritt, Legislative Staff Curt Clothier, Legislative Staff Rep. Selim Noujaim, Republican Sen. Dennis Egan, Democrat Rep. Chris Perone, Democrat, Vice Chair Rep. David Guttenberg, Democrat Delaware Arkansas Rep. John Burris, Republican Sen. Catherine Cloutier, Republican Sen. F. Bruce Holland, Republican Rep. Deborah Hudson, Republican Sen. Jeremy Hutchinson, Republican Sen. Harris McDowell, Democrat Roger Norman, Legislative Staff Rep. Darryl Scott, Democrat Rep. Mark Perry, Democrat Sen. Robert Venables, Sr., Democrat Sen. Jason Rapert, Republican Rep. Henry Wilkins, Democrat District of Columbia Councilmember Michael Brown, Democrat California Sen. Christine Kehoe, Democrat Florida Asm. Fiona Ma, Democrat Kara Collins-Gomez, Legislative Staff

Colorado Georgia Sen. Greg Brophy, Republican Rep. Stephen Allison, Republican Sen. , Democrat Rep. Steve Davis, Republican Sen. Evie Hudak, Democrat Sen. Bill Hamrick, Republican Sen. Keith King, Republican Brian Johnson, Legislative Staff Rep. , Republican Rep. Billy Mitchell, Republican Sen. , Republican Rep. Don Parsons, Republican Rep. Amy Stephens, Republican Sen. Cecil Staton, Republican

Connecticut Hawaii Melissa Buckley, Legislative Staff Sen. Rosalyn H. Baker, Democrat Sen. , Democrat Sen. Carol Fukunaga, Democrat, Co-Chair Katherine Dwyer, Legislative Staff Rep. Robert Herkes, Democrat Sen. L. Scott Frantz, Republican

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NATIONAL CONFERENCE OF STATE LEGISLATURES 2011 - 2012 STANDING COMMITTEE ON COMMUNICATIONS, FINANCIAL SERVICES & INTERSTATE COMMERCE

Illinois Kentucky Sen. Pamela Althoff, Republican Sen. Tom Buford, Republican Sen. Jacqueline Collins, Democrat Rep. Dwight Butler, Republican Sen. Iris Martinez, Democrat Sen. Perry Clark, Democrat Rep. Frank Mautino, Democrat Rep. Robert Damron, Democrat Louie Mossos, Legislative Staff Rep. Jeff Greer, Democrat Rep. Timothy Schmitz, Republican Rep. Keith Hall, Democrat Maurice Scholten, Legislative Staff Donna Robinson Holiday, Legislative Staff Rep. Jimmie Lee, Democrat Indiana Rep. Brad Montell, Kentucky Rep. Jeb Bardon, Democrat Sen. Gerald Neal, Democrat Rep. C. Woody Burton, Republican Rep. Tanya Pullin, Democrat Eric Gonzalez, Legislative Staff Sen. Dorsey Ridley, Democrat Sen. , Republican Rep. Steve Riggs, Democrat Rep. , Republican Sen. Daniel Seum, Republican Sen. , Democrat Sen. Tim Shaughnessy, Democrat Sen. Allen Paul, Republican Mike Sunseri, Legislative Staff Sen. , Democrat Rep. Tommy Thompson, Democrat Sen. Brent Waltz, Republican Louisiana Iowa Sen. A.G. Crowe, Republican Glen Dickinson, Legislative Staff Gary Schaefer, Legislative Staff Vice Chair Richard Johnson, Legislative Staff Julie Simon, Legislative Staff Maine Colleen McCarthy Reid, Legislative Staff Kansas Melissa Calderwood, Past Staff Chair Maryland Rep. Nile Dillmore, Democrat Del. Kumar Barve, Democrat Rep. Stan Frownfelter, Democrat Del. Emmett Burns, Jr., Democrat Rep. Robert Grant, Democrat Del. Brian Feldman, Democrat David Larson, Legislative Staff Sen. Delores G. Kelley, Democrat, Sen. Ty Masterson, Republican Immediate Past Chair Rep. Charlotte O'Hara, Republican Del. Susan Krebs, Republican Rep. Richard Proehl, Republican Del. Susan Lee, Democrat, Vice Chair Sen. Allen Schmidt, Democrat Sen. C. Anthony Muse, Democrat Rep. Clark Shultz, Republican Sen. E.J. Pipkin, Republican Rep. Gene Suellentrop, Republican Sen. Catherine Pugh, Democrat Sen. Ruth Teichman, Republican Del. Nancy Stocksdale, Republican Del. Michael Vaughn, Democrat

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NATIONAL CONFERENCE OF STATE LEGISLATURES 2011 - 2012 STANDING COMMITTEE ON COMMUNICATIONS, FINANCIAL SERVICES & INTERSTATE COMMERCE

Massachusetts Massachusetts (continued) Rep. Paul Adams, Republican Rep. Thomas Stanley, Democrat Rep. , Democrat Rep. Walter Timilty, Democrat Rep. , Democrat Rep. Cleon Turner, Democrat Rep. , Republican Rep. Paul Brodeur, Democrat Michigan Rep. James Cantwell, Democrat Patrick Affholter, Legislative Staff Rep. Gailanne Cariddi, Democrat Sen. Steven Bieda, Democrat Rep. , Democrat Sen. Darwin Booher, Republican Rep. Michael Costello, Democrat Julie Cassidy, Legislative Staff Rep. Geraldine Creedon, Democrat Sen. Joe Hune, Republican Rep. , Democrat Rep. Martin J. Knollenberg, Republican Rep. Stephen DiNatale, Democrat Rep. Lisa P. Lyons, Republican Rep. James Dwyer, Democrat Sen. Michael L. Nofs, Republican Rep. , Democrat Rep. Amanda Price, Republican Rep. Christopher Fallon, Democrat Sen. John M. Proos IV, Republican Rep. Ryan Fattman, Republican Robin Risko, Legislative Staff Rep. , Democrat Rebecca Ross, Legislative Staff Rep. , Democrat Sen. Tonya Schuitmaker, Republican Rep. Thomas Golden, Democrat Jim Stansell, Legislative Staff Rep. , Democrat Steve Stauff, Legislative Staff Rep. , Democrat Rep. Jimmy Womack, Democrat Rep. Steven Howitt, Republican Rep. Donald Humason, Republican Minnesota Rep. , Republican Rep. Joe Atkins, Democrat Sen. Brian Joyce, Democrat Rep. Pat Mazorol, Republican Rep. John Keenan, Democrat Rep. Tim O’Driscoll, Republican Sen. Michael Knapik, Republican Troy Olson, Legislative Staff Rep. Kevin Kuros, Republican Thomas Pender, Legislative Staff Rep. , Republican Rep. Tim Sanders, Republican Rep. , Democrat Katherine Schill, Legislative Staff Rep. John Mahoney, Democrat Rep. Kelby Woodard, Republican Rep. Kevin Murphy, Democrat Rep. Rhonda Nyman, Democrat Mississippi Rep. Jerald Parisella, Democrat Sen. Nancy Adams Collins, Republican Sen. Anthony Petruccelli, Democrat Mandy Davis, Legislative Staff Rep. , Democrat Ronald Frith, Legislative Staff Rep. John Rogers, Democrat Rep. Theodore Speliotis, Democrat Rep. Joyce Spiliotis, Democrat ~ 18 ~

NATIONAL CONFERENCE OF STATE LEGISLATURES 2011 - 2012 STANDING COMMITTEE ON COMMUNICATIONS, FINANCIAL SERVICES & INTERSTATE COMMERCE

Missouri New Mexico Rep. T.J. Berry, Republican Claudia Armijo, Legislative Staff Terri Rademan, Legislative Staff Sen. William Burt, Republican Rep. Dave Schatz, Republican Sen. Carlos Cisneros, Democrat Sen. Phil Griego, Democrat Montana Sen. Timothy Keller, Democrat Bart Campbell, Legislative Staff Damian Lara, Legislative Staff Rep. Rob Cook, Republican Sen. Lynda Lovejoy, Democrat Rep. Champ Edmunds, Republican Sen. Cisco McSorley, Democrat Todd Everts, Legislative Staff Sen. Steven Neville, Republican Rep. Galen Hollenbaugh, Democrat Rep. Debbie Rodella, Democrat Sen. Cliff Larsen, Democrat Sen. Nancy Rodriquez, Democrat Patricia Murdo, Legislative Staff Co-Chair Sen. John Christopher Ryan, Republican Sonja Nowakowski, Legislative Staff Sen. Bernadette Sanchez, Democrat Hope Stockwell, Legislative Staff Sen. John Arthur Smith, Democrat Helen Thigpen, Legislative Staff Sen. David Ulibarri, Democrat

Nebraska North Carolina Sen. Abbie Cornett, Non-Partisan Rep. Alma Adams, Democrat Sen. Deb Fischer, Non-Partisan Rep. Harold Brubaker, Republican Sen. Pete Pirsch, Non-Partisan Karen Cochrane-Brown, Legislative Staff Sen. Paul Schumacher, Non-Partisan Vice Chair Rep. Jerry Dockham, Republican Nevada Walker Reagan, Legislative Staff Asm. Irene Bustamante Adams, Democrat Rep. Mitchell Setzer, Republican Asm. Richard Daly, Democrat Rep. Joe Tolson, Democrat Asm. Pat T. Hickey, Republican Rep. Michael Wray, Democrat

New Hampshire North Dakota Rep. John Hunt, Republican Sen. Larry Robinson, Democrat Michael Kane, Legislative Staff Sen. Bob Skarphol, Republican Michael J Landrigan, Legislative Staff Christopher M. Shea, Legislative Staff Ohio Rep. Kathleen Taylor, Democrat Rep. Richard Adams, Republican New Jersey Rep. Peter Beck, Republican Asm. Upendra Chivukula, Democrat Michael Dittoe, Legislative Staff Asm. Paul Moriarty, Democrat Rep. Jay Goyal, Democrat Asm. L. Grace Spencer, Democrat Sen. Eric Kearney, Democrat Rep. Peter Stautberg, Republican

~ 19 ~

NATIONAL CONFERENCE OF STATE LEGISLATURES 2011 - 2012 STANDING COMMITTEE ON COMMUNICATIONS, FINANCIAL SERVICES & INTERSTATE COMMERCE

Oklahoma South Carolina Sen. Cliff A. Aldridge, Republican Sen. Thomas Alexander, Republican,Vice Chair Kim Bishop, Legislative Staff Rep. Kenneth Bingham, Republican Sen. Rick Brinkley, Republican Sen. Glenn Reese, Democrat Sen. Bill Brown, Republican Mary Riley, Legislative Staff Rep. Mike Brown, Democrat Michael Shealy, Legislative Staff Rep. David Brumbaugh, Republican Jane Shuler, Legislative Staff Rep. Larry Glenn, Democrat Sen. David Thomas, Republican Rep. Randy Grau, Republican Rep. Charles Key, Republican South Dakota Rep. Dan Kirby, Republican Rep. Kristin Conzet, Republican Rep. James Lockhart, Democrat Sen. Deb Peters, Republican Rep. Steve Martin, Republican Rep. Mark K. Willadsen, Republican Sen. Mike Mazzei, Republican Rep. Lewis H. Moore, Republican Tennessee Rep. Jason W. Murphey, Republican Sen. Charlotte Burks, Democrat Rep. Marty Quinn, Republican Luke Gustafson, Legislative Staff Rep. Seneca Scott, Democrat Sen. Jack Johnson, Republican Rep. John Trebilcock, Republican Rep. Stephen McManus, Republican Anna Richardson, Legislative Staff Pennsylvania Sen. Steve Southerland, Republican Rep. Frank Burns, Democrat Sen. Jim Tracy, Republican Neil Friedman, Legislative Staff Rep. Nick Kotik, Democrat Texas Rep. Mark Longietti, Democrat Rep. Brandon Creighton, Republican Rep. Dan Flynn, Republican Pennsylvania (continued) Sen. Troy Fraser, Republican Rep. Robert F. Matzie, Democrat Rep. Lance Gooden, Republican John Raymond, Legislative Staff Sen. Chris Harris, Republican Rep. Chris Sainato, Democrat Rep. Harvey Hilderbran, Republican Rep. Charles Howard, Republican Puerto Rico Rep. Jose Menendez, Democrat Rep. Jose L. Chico Vega, NPP Linda Pittsford, Legislative Staff Speaker Jenniffer Gonzalez Colon, PDP Rep. Vicki Truit, Republican Luis Hidalgo, Legislative Staff Sen. Leticia Van de Putte, Democrat Rep. Gabriel Rodriguez Aguilo, NPP Rep. Hubert Vo, Democrat Rep. Paula A Rodriguez Homs, NPP Sen. Royce West, Democrat Sen. Tommy Williams, Republican Rhode Island Rep. Brian Patrick Kennedy, Democrat ~ 20 ~

NATIONAL CONFERENCE OF STATE LEGISLATURES 2011 - 2012 STANDING COMMITTEE ON COMMUNICATIONS, FINANCIAL SERVICES & INTERSTATE COMMERCE

Utah West Virginia Sen. Curtis Bramble, Republican Del. Nancy Peoples Guthrie, Democrat Rep. Wayne Harper, Republican, Sen. Walt Helmick, Democrat Vice Chair Sen. Evan Jenkins, Democrat Sen. Peter Knudson, Republican Sen. Jeffrey Kessler, Democrat Zackery N. Zing, Legislative Staff Del. Cliff Moore, Democrat Melanie Pagliaro, Legislative Staff Vermont StephanieBarrett, Legislative Staff Wisconsin Rep. Jim Condon, Democrat Margit Kelley, Legislative Staff Rep. Susan Hatch Davis, Progressive Dan Schmidt, Legislative Staff Duncan Goss, Legislative Staff Co-Chair Wyoming Rep. Warren Kitzmiller, Democrat Rep. William Lippert, Democrat Rep. John A. Botten, Republican Rep. Ernest Shand, Democrat Sen. Cale Case, Republican Sara Teachout, Legislative Staff Lynda Cook, Legislative Staff Senator Floyd A. Esquibel Virginia David Gruver, Legislative Staff Del. Robert Brink, Democrat Rep. Kendell Kroeker, Republican Del. Kathy Byron, Republican Sen. Adam Ebbin, Democrat Wisconsin Sen. Mark R. Herring, Democrat Margit Kelley, Legislative Staff Del. Joe May, Republican, Vice Chair Dan Schmidt, Legislative Staff Sen. Phillip Puckett, Democrat Wyoming Sen. Walter Stosch, Republican Rep. John A. Botten, Republican Lisa Wallmeyer, Legislative Staff Sen. Cale Case, Republican Sen. John C. Watkins, Republican Lynda Cook, Legislative Staff Del. Vivian Watts, Democrat Senator Floyd A. Esquibel

David Gruver, Legislative Staff Washington Rep. Kendell Kroeker, Republican Sen. Maralyn Chase, Democrat Rep. Bob Hasegawa, Democrat Joe Hedegard, Legislative Staff Rep. Ross Hunter, Democrat, Vice Chair Rep. Troy Kelley, Democrat Rep. John McCoy, Democrat Thomas Osborn, Legislative Staff

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New Policy Statements and Resolutions All new policy directives and resolutions must be submitted to the attention of the Washington Office Directors, Neal Osten and Molly Ramsdell ([email protected]) by 5:00 pm (EST) on Monday, July 9. They will submit the policy directives and resolutions to the co-chairs of the Standing Committees, Senator Curt Bramble of Utah and Assemblywoman Fiona Ma of California, for assignment to the appropriate committee(s) of jurisdiction.

All policy directives and resolutions to be considered at the 2012 Legislative Summit in Chicago must be posted on NCSL’s web site no later than Monday, July 30, though our intention is to have everything posted by July 20. The list of policy directives and resolutions will be sent to all legislative leaders, NCSL Executive Committee members, and chairs and vice chairs of the NCSL standing committees. Each committee is responsible for making the policy directives and resolutions available to all committee members.

Amendments to Policy Directives and Resolutions NCSL’s Executive Committee has made it a priority to ensure that NCSL’s policy development process is transparent as evidence by the 30 day introduction requirement for policy directives and resolutions. In that same regard, the Executive Committee has approved changes to the NCSL Rules of Procedure that will set guidelines for the introduction of amendments to policy directives and resolutions. These proposed changes will be considered at the Business Meeting in Chicago and therefore will not be in effect for the 2012 Legislative Summit. However, to foster the transparency of NCSL’s policy process, members are encouraged to introduce amendments to policy directives and resolutions no later than July 30, which is ten days before the Legislative Summit Business Meeting.

Voting Members of the Committee The roster of voting members for each standing committee is the roster on file with NCSL as of August 3, 2012. The legislators on that roster have been duly appointed by their appropriate presiding officer in their legislative chamber. Appointments to a committee after August 3 shall be made in writing from the appropriate presiding officer and delivered to Bill Pound, NCSL Executive Director, no later than the start of a committee’s scheduled business meeting. (Please see below.) Committee chairs may want to announce at the beginning of the first committee session that only legislators on the official committee roster (which will include any new appointments made to Bill Pound) will be permitted to vote during the committee’s business meeting.

Appointments to a committee cannot be accepted once the FIRST business meeting for that committee starts. For the 2012 Legislative Summit, the scheduled start of the various standing committees is as follows:

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Committee Date Time Human Services & Welfare Monday, August 6 12:00 pm Law & Criminal Justice Monday, August 6 12:00 pm Agriculture & Energy Monday, August 6 3:15 pm Environment Monday, August 6 3:15 pm Health Monday, August 6 3:15pm Labor & Economic Development Monday, August 6 3:15 pm Transportation Monday, August 6 3:15 pm Budgets and Revenue Tuesday, August 7 10:30 am Communications, Financial Services Tuesday, August 7 10:30 am and Interstate Commerce Education Tuesday, August 7 10:30 am

Committee Business Meeting All committee members to be identified with appropriate table tent name holder, prepared by NCSL staff. The presiding legislator co-chair [chair] or one of the legislator vice chairs calls the meeting to order at the scheduled time. The presiding legislator co-chair shall establish the presence of a quorum. It is recommended that the chair call the roll of states to determine the presence of a quorum. The quorum for the adoption of policy directives and resolutions in a standing committee shall consist of representation of appointed legislator members from at least 10 states. A quorum call can also be requested by legislator members from 2 states at any time during the committee business meeting. A legislator member from a state not present for the most recent quorum call can, before the start of the next roll call vote, request recognition from the presiding legislator co-chair and be recorded as present for purposes of the quorum. Each committee shall review and act on all policy directives or resolutions referred to the committee. A legislator member who is sponsoring a policy directive, resolution or amendment may withdraw such policy directive, resolution or amendment at any time before a vote is called. If a committee fails to take up any policy directive or resolution on its agenda before the scheduled time of the committee meeting expires, those policy directives and resolutions would be considered tabled and held over until the next meeting of the committee in Washington, D.C., December 6-8, 2012. A summary of action on all policy directives and resolutions must be kept by NCSL staff and such summary shall be delivered by the legislator co-chairs or one of the legislator vice chairs at the appropriate meeting of the Steering Committee. The legislator chair or one of the legislator vice chairs acting as presiding officer of the standing committee has the obligation and authority to preserve order and decorum and have charge of the committee meeting room at all times. Committee does not need to take any further action to table unfinished business.

~ 23 ~ All standing committee business meeting must end by 3:15 pm on Tuesday, August 7, 2012.

Voting During the Committee Business Meeting Only duly appointed legislator members of the committee can vote on matters of public policy. All voting in the committee shall be by a voice vote, except when a roll call is requested by at least one legislator from two member states, or is called by the legislator chair. During a roll call vote on a question, only states that were recorded as present during the most recent quorum call shall be called on to vote. The legislator chair may request any delegation from a state to designate a spokesperson if there are more than two legislators from the state. The spokesperson would cast the vote for the state on any roll call vote. The vote by a state shall represent the majority view of all the duly appointed legislator members from the state present and voting. If the legislator members in a state delegation are evenly divided, the state vote would be recorded as present. On matters of public policy an affirmative vote of three-fourths (3/4) of the states responding to the most recent quorum call shall be required. This means that states that pass, abstain or vote present would be counted. For all amendments to policy directives and resolutions, a simple majority of the states responding to the most recent quorum call shall be required. A quorum call can be requested at any time by legislator members from two states prior to the start of a roll call vote. At such time that the legislator chair announces the vote on a policy directive or resolution, the vote is final. Motions to reconsider a question can be made by any legislator member of the committee. If a policy directive or resolution passes the committee unanimously it will be reported to the Consent Calendar. Policy directives or resolutions adopted at the previous Fall or Spring Forum shall also be considered on the Consent Calendar. Any policy statement or resolution receiving at least one no vote shall be reported to the Debate Calendar.

Post Committee Meeting Responsibilities The legislator chair or a designated legislator vice chair shall make a report to the Steering Committee on Tuesday, August 7 at 4:45 pm on the disposition of all the policy directives and resolutions that were on the committee’s agenda.

The legislator chair or a designated legislator vice chair is responsible for making an introductory statement and moving the committee’s policy directives and resolutions that appear on the Debate Calendar on the floor of the NCSL Annual Business Meeting on Thursday, August 9, 2012. The Business Meeting will take place 10:30 am – 12:15 pm.

~ 24 ~ Guidance for Transition of Current Communications, Financial Services & Interstate Commerce Committee Policy Statements to Policy Directives

Policy Directives Fall Forum 2011 Legislative Summit 2012 Current Policy Statements Post Legislative Summit 2012

Policy Statements 21st Century Communications st st st 21 Century 21 Century (21 Century Communications) st Communications 1. 21 Century Communications (Spectrum Management) Communications

2. Spectrum Management 3. Banking Regulation Policy Statements Banking & Financial Services 4. Corporate Formations (Banking Regulation) 5. Dual Chartering of Credit 1. Banking Regulation (Dual Chartering of Credit Unions) Banking & Financial Unions 2. Corporate Formations (Financial Information Security) Services 6. Financial Information Security 3. Dual Chartering of Credit Unions (State Sovereignty in Financial Services) 7. State Sovereignty in Financial 4. Financial Information Security Services 5. State Sovereignty in Financial Insurance 8. Insurance Regulatory Services (Insurance Regulatory Modernization) Insurance Modernization 6. Insurance Regulatory (Insurance Fraud – Federal Criminalization)

9. Insurance Fraud - Federal Modernization (Equal Access to FBI Crim. History Recs.) Criminalization 7. Insurance Fraud - Federal (Natural Disaster Mitigation & Insurance) 10. Equal Access to FBI Crim. Criminalization (Terrorism Risk Insurance) History Recs. 8. Equal Access to FBI Crim. The Internet & 11. Natural Disaster Mitigation & History Recs. The Internet & Electronic Commerce Electronic Commerce (The Internet & Electronic Commerce) Insurance 9. Natural Disaster Mitigation & Insurance (Video Franchise Reform) 12. Terrorism Risk Insurance 13. The Internet & Electronic 10. Terrorism Risk Insurance

Commerce 11. The Internet & Electronic Corporate Formations Corporate Formations 14. Cradle to Grave Electronics Commerce (Corporate Formations)

Management 12. Cradle to Grave Electronics Management * 15. Nexus in the New Economy Remote Commerce 13. Nexus in the New Economy Remote Commerce 16. Video Franchise Reform 14. Video Franchise Reform (Nexus in the New Economy )

* Incorporated into Environment Committee’s Waste Management Policy Directive

Resolutions Expiring at the 2012 Legislative Summit in Chicago, Illinois Opposes the State Video Tax Fairness Act (Consent Calendar) Supports Federal VoIP Communications Sourcing Act (Consent Calendar)~ 3 ~ Supports Public Private Partnerships to Increase Broadband Internet Adoption and Use (Consent Calendar) Supports and Urges Enactment of the Main Street Fairness Act Supports Intellectual Property (IP) Rights and Protections to Promote Productivity, Competitiveness, Jobs, and Public Health Opposes Federal Contactless Technology Mandates For State Issued Identification Documents

1 COMMITTEE: COMMUNICATIONS, FINANCIAL SERVICES & 2 INTERSTATE COMMERCE 3 4 POLICY: BANKING & FINANCIAL SERVICES 5 6 TYPE OF POLICY: DRAFT POLICY DIRECTIVE 7 8 STATE SOVEREIGNTY IN FINANCIAL SERVICES 9 The National Conference of State Legislatures (NCSL) is concerned that Congress, the 10 federal financial services regulators, and the federal courts have sought to nationalize 11 control of financial services in Washington, D.C. NCSL has consistently and strongly 12 advocated for state sovereignty in financial services regulation. NCSL has opposed any 13 federal preemption of state legislative or regulatory authority in financial services. A high 14 burden of proof that federal action is necessary, such as a national financial crisis, should 15 be met before any preemption of state financial services laws and regulations is warranted.

16 Preservation of Dual Banking System 17 NCSL is committed to the preservation of the dual banking system. The dual system 18 enables state governments to apply laws and regulations to banks and thrifts that serve 19 the needs of local economies and that respond to the values and concerns of local 20 citizens. In recognition of the advantages of the dual system to the public and to the 21 health of the financial services industry, NCSL opposes any efforts by the federal 22 government to restrict state authority to charter, supervise, or regulate the powers of state 23 chartered banks and thrifts. NCSL opposes any federal attempts to tax state banks for 24 federal oversight services already performed by the appropriate state banking agencies 25 and departments. Nonetheless, NCSL recognizes that the states have a duty to use their 26 powers responsibly and in a way that does not endanger the deposit insurance system 27 and thereby the nation's financial stability. NCSL acknowledges congressional efforts in 28 the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank) to limit 29 the unchecked preemption efforts by the Office of the Comptroller of the Currency (OCC) 30 of state financial consumer protections. NCSL urges continued congressional vigilance of

~ 26 ~ 31 the OCC and asks the secretary of the Treasury to ensure that the spirit of the Dodd- 32 Frank Act in ensuring the states’ role in protecting consumers is not diminished in 33 regulations establishing the new Consumer Financial Protection Bureau.

34 Federal Regulatory Consolidation 35 NCSL recognizes the need for the federal government to reduce the federal regulatory 36 burden that can impede the economic vitality of our nation's financial services industries. 37 In consolidating the federal banking regulators, Congress must ensure that any 38 consolidation does not invalidate the regulatory independence of the dual banking 39 system.

40 NCSL opposes any federal regulatory consolidation plan that would: 41 Preempt, limit or interfere with the rights of states to regulate state chartered 42 banks; 43 Require federal reporting requirements and examinations that duplicate state 44 efforts; 45 Place state chartered banks at a competitive disadvantage with national banks or 46 federal thrifts; and 47 Grant oversight authority for state chartered banks to the OCC, the regulator of 48 national banks.

49 NCSL supports the continued federal oversight by the FDIC and the Federal Reserve of 50 state chartered banks. It would be detrimental to the well-being of the dual banking 51 system for Congress to tamper with present oversight cooperation between state banking 52 departments, the FDIC and the Federal Reserve.

53 Federal Preemption 54 NCSL strongly believes that a high burden of proof must be established before federal 55 preemption of state banking authority is ever justified and that only Congress—and not 56 federal regulatory agencies—can preempt the actions of elected state leaders. NCSL 57 supports the “prevent or significantly interfere with” standard established by the Supreme

~ 27 ~ 58 Court and reiterated in Subtitle D of Title X of the Dodd-Frank Act to govern federal 59 preemption of state laws as those laws apply to national banks. NCSL strongly opposes 60 any effort by the OCC to assert its regulatory authority to weaken the standard of 61 preemption or shield national banks and bank operating subsidiaries from state consumer 62 protection laws and enforcement. Moreover, NCSL encourages Congress to eliminate the 63 judicial deference given to the OCC by federal courts in challenges to state financial 64 services laws and to restrain OCC abuse of its regulatory authority to preempt state laws.

65 Dual Chartering of Credit Unions 66 NCSL believes that state credit union supervisors have the primary responsibility for 67 assuring the safety and soundness of credit unions chartered by and operating under 68 state law and regulation. NCSL supports the authority of state governments to determine 69 how state financial institutions must be insured and opposes any efforts by the federal 70 government to preempt states’ authority to govern state deposit insurance requirements. 71 NCSL also acknowledges that states have a responsibility to provide a credible regulatory 72 environment where powers can be exercised in a way that does not endanger the 73 financial solvency of the National Credit Union Share Insurance Fund (NCUSIF). NCSL 74 additionally acknowledges that federal deposit insurance agencies, like the National 75 Credit Union Administration (NCUA), have a legitimate role to play if state authorized 76 powers lead to unreasonable risks for NCUSIF. However, NCUA regulations and policies 77 should be crafted in a way that minimizes the preemption of state authority. NCSL 78 opposes any effort by the Administration and Congress to erode the dual chartering 79 system for credit unions by preempting state credit union laws and regulations that do not 80 adversely impact the financial well-being of state chartered credit unions and thus the 81 NCUSIF. Any preemption of state credit union laws or regulatory authority must be 82 justified only by a clear and certain threat to the credit unions' share insurance fund by 83 those credit unions that are federally insured.

84 Consumer Protection 85 State legislatures and Congress must periodically consider legislation: to ensure 86 consumer access to basic financial services; to protect the privacy of financial consumers

~ 28 ~ 87 and the security of their personal financial information; to provide protection for 88 consumers from abusive lending practices; to ensure disclosure of information about 89 credit terms, interest rates, fees, and balances; to regulate branch closing; and to 90 otherwise protect the consuming public. In recognition that this is an area of overlapping 91 federal and state jurisdiction, NCSL will ordinarily not oppose such federal consumer 92 protection measures, provided that there is no preemption of complementary state 93 consumer protection legislation. Federal legislation should not prohibit state legislatures 94 and state regulators from providing additional protections for consumers of financial 95 services. Furthermore, as the Consumer Financial Protection Bureau established in 96 Dodd-Frank commences its role as the federal agency responsible for regulating 97 consumer protection and enforcing applicable federal laws NCSL opposes any action that 98 preempts state consumer protections law or undermines the principles of federalism. 99 Finally, as online financial services continue to grow, clear rules must be established as to 100 which jurisdiction's consumer protections apply to a given transaction. NCSL believes that 101 any such rules should be crafted through a partnership between state and federal 102 regulators and should not place state chartered financial institutions at a disadvantage in 103 the institution’s ability to provide services over the Internet.

104 Financial Services and Economic Development 105 NCSL recognizes that racial, ethnic, or gender discrimination by financial services 106 institutions may have an impact on the ability of residents in distressed communities to 107 obtain financial assistance. State legislators also recognize the need for financial 108 institutions to make safe, sound and profitable investments. NCSL, recognizing the 109 responsibilities that each state has for financial institution regulation and solvency and for 110 providing for fair lending to their constituents, believes that each state legislature has the 111 responsibility to address the unique needs of its state. Likewise, the federal government 112 as regulator of federal financial institutions must make the same determinations and act 113 accordingly. However, Congress must not mandate federal guidelines that impede the 114 states' abilities to regulate financial services.

~ 29 ~ 115 Securities Regulation 116 NCSL recognizes that the federal government has an interest in efficient and fair capital 117 markets. NCSL also acknowledges that the states’ securities agencies are indispensable 118 partners with their federal counterparts engaging in the pursuit of fair and efficient capital 119 markets by protecting local investors, workers, and communities by ensuring compliance 120 with securities laws.

121 NCSL is concerned that the preemption of state securities laws and regulations will serve 122 only to erode investor trust in the capital markets by further weakening a system designed 123 to protect investors and putting the financial well-being of hard-working Americans at risk. 124 NCSL opposes such federal preemption and the creation of self-regulatory organizations 125 that usurp state authority. Instead, NCSL supports congressional efforts to expand the 126 restoration of state securities regulators’ authority.

127 Mortgage Industry 128 Currently states regulate a significant portion of mortgage lending. Federalizing this area 129 of supervision will displace the 50-state regulatory system that has rapidly evolved and 130 could erode, or even eliminate, the current authority the states have to approve, supervise 131 and bar mortgage professionals. The local nature of real estate and consumer protection 132 necessitates direct state authority.

133 States, through the Conference of State Bank Supervisors (CSBS) and the American 134 Association of Mortgage Regulators (AARMR), developed the Nationwide Mortgage 135 Licensing System (NMLS) to improve and coordinate mortgage supervision. This state 136 system enhances consumer protection and streamlines the licensing process for 137 regulators and the industry. NCSL supports the NMLS to encourage a more coordinated 138 system of state and federal supervision.

139 FINANCIAL INFORMATION SECURITY 140 NCSL believes that states should continue to play a vital role in protecting the privacy, 141 confidentiality and security of sensitive nonpublic personal financial information. States

~ 30 ~ 142 long have sought to balance the economic value of information sharing with reasonable 143 safeguards against the unnecessary disclosure and inappropriate acquisition of sensitive 144 nonpublic personal financial information, such as credit information, account numbers, 145 account balances, and Social Security numbers. Understanding local and regional 146 economic situations and the unique needs of consumers within these markets, states 147 consistently have ensured the protection of sensitive nonpublic personal financial 148 information.

149 State legislatures recognize that financial information security is an area of overlapping 150 federal and state jurisdiction. Therefore, NCSL does not oppose federal baseline 151 standards for the protection of financial information, provided that these standards 152 generally do not preempt complementary state laws. NCSL believes that states should 153 have the authority and flexibility to adopt standards for the acquisition, retention, 154 disclosure and sharing of financial information by and among financial institutions and 155 nonaffiliated third parties that address local concerns or respond in a timely way to 156 incidences of neglect or abuse that may be local or regional in nature. NCSL specifically 157 believes that Congress should preserve state authority to exceed federal baseline 158 standards for information sharing among nonaffiliated third parties.

159 Credit Reporting 160 NCSL acknowledges the benefit of a uniform national credit reporting system to the 161 nation's economy. Therefore, NCSL does not oppose the limited areas that were subject 162 to federal preemption by the 1996 Amendments of the Fair Credit Reporting Act and 163 made permanent by the Fair and Accurate Credit Transactions Act. In doing so, NCSL 164 supports the continued exemption of the state laws that were in existence prior to the 165 1996 Amendments and thus are currently exempted from the preemption provisions.

166 Data Security Breach Disclosure 167 Consistent with NCSL’s general policy for safeguarding financial information, NCSL does 168 not oppose baseline federal data security breach notification standards, provided that the 169 requirements do not preempt state authority to adopt standards that provide affected

~ 31 ~ 170 consumers additional protection and notification. NCSL also supports allowing state 171 financial regulators and attorneys general to enforce any new federal data security breach 172 notification standards

173 In the event that Congress decides to preempt state law, NCSL urges that the preemption 174 be narrowly construed to preempt only state laws that are inconsistent with the federal 175 standard while preserving state laws that apply to entities that may be excluded from the 176 federal act. Additionally, should Congress decide to preempt state data security breach 177 notification laws, NCSL would support a strong federal law that would require notification 178 of the affected consumers when sensitive personally identifiable information has been, or 179 is reasonably believed to have been, accessed or acquired. In this instance, exceptions 180 should be made only when it is concluded that there is no significant risk that the breach 181 has resulted in, or will result in, harm to the individual whose information has been 182 breached.

~ 32 ~ 1 COMMITTEE: COMMUNICATIONS, FINANCIAL SERVICES & 2 INTERSTATE COMMERCE 3 4 POLICY: CORPORATE FORMATIONS 5 6 TYPE OF POLICY: DRAFT POLICY DIRECTIVE 7 8 The ability to regulate and set standards for incorporation law resides within the 9 individual states. Many states rely on the revenue generated by incorporation 10 fees, corporate taxes and other fees as a way to fund many of their public 11 needs. States determine requirements regarding the articles of incorporation and 12 have the ability to tighten and lift barriers for corporate formation. The National 13 Conference of State Legislatures opposes any unwarranted effort at the federal 14 level to preempt state incorporation laws.

~ 33 ~ 1 COMMITTEE: COMMUNICATIONS, FINANCIAL SERVICES & 2 INTERSTATE COMMERCE 3 ENVIRONMENT 4 5 POLICY: CRADLE TO GRAVE ELECTRONICS MANAGEMENT 6 7 TYPE OF POLICY: DRAFT POLICY DIRECTIVE 8 9 The disincentives for reuse and recycling of electronics scrap or e-scrap must be 10 examined and mitigated by all relevant stakeholders.

11 NCSL encourages the full cooperation and assistance of the federal government in 12 state efforts to promote responsible product stewardship and encourage the 13 development of an infrastructure necessary to support the widespread recovery of a 14 broad range of electronic equipment. Any legislative or regulatory action taken at the 15 federal level must recognize the importance of a state-federal partnership in managing 16 the current stream of end-of-life electronics and promote future product stewardship of 17 electronic equipment.

~ 34 ~ 1 COMMITTEE: COMMUNICATIONS, FINANCIAL SERVICES & 2 INTERSTATE COMMERCE 3 4 POLICY: INSURANCE 5 6 TYPE OF POLICY: DRAFT POLICY DIRECTIVE 7 8 INSURANCE REGULATORY MODERNIZATION 9 The National Conference of State Legislatures (NCSL) is committed to state regulation 10 of the business of insurance. NCSL acknowledges the responsibility of states to adjust 11 state systems to meet the needs of the modern economy. NCSL opposes any proposal 12 to establish either a federal or a dual system of regulation of insurance, to cede any 13 state authority to regulate financial institutions involved in the business of insurance or 14 to obtain Congressional ratification of trade agreements that preempt state regulation of 15 insurance.

16 States and insurance commissioners continue to develop a shared vision of insurance 17 regulatory reform to meet the needs of the modern marketplace while preserving the 18 advantages of the state system. NCSL supports the efforts of states to streamline and 19 simplify insurance regulation. NCSL endorses state participation in the Interstate 20 Insurance Product Regulation Commission, which creates a national state-based 21 system to make regulatory decisions quickly on life insurance products according to 22 uniform national standards. NCSL endorses state participation in the Surplus Lines 23 Insurance Multi-State Compliance Compact (SLIMPACT), an interstate compact to 24 protect and facilitate the collection of premium tax revenue on surplus lines and 25 independently procured insurance placements by the compacting states.

26 NCSL believes that state efforts to enact significant reforms in critical areas represent 27 tremendous progress, and NCSL will continue to support further efforts as states move 28 forward to achieve widespread reform in all areas in the years ahead.

~ 35 ~ 29 State-Federal Partnership 30 Individually and at the national level, states work to modernize insurance regulation. 31 However, state legislatures recognize a legitimate federal role in overseeing and 32 promoting well-functioning insurance markets.

33 Title V of the Dodd-Frank Wall Street Reform and Consumer Protection Act established 34 The Federal Insurance Office (FIO) within the U.S. Department of Treasury. While 35 NCSL and other state groups were successful in limiting the scope of the FIO’s 36 authority, concern remains that the FIO will serve as a vehicle to promote a greater 37 federal role in the historically state-regulated industry of insurance.

38 Therefore, NCSL opposes any administrative action by the FIO or federal legislation 39 that: relies on wholesale preemption of state authority, would compel state compliance 40 with federal standards or those of any non-governmental third party, or conditions, 41 restricts or redirects state insurance revenues, including insurance premium taxes, fees 42 and fines, either directly or as a condition of a state’s refusal to submit to federal 43 standards or federal efforts to commandeer a state executive branch official to 44 participate in a federal regulatory program.

45 Moreover, some in Congress and industry support federal legislation to establish a 46 single federal regulator of insurance or allow for dual federal and state insurance 47 regulation. NCSL opposes any provision of federal legislation that preempts state 48 authority through the creation of a federal insurance official, commission or entity with 49 the authority to regulate insurance, to implement federal standards, to enforce state 50 compliance with federal standards, or to initiate or participate in judicial proceedings to 51 resolve differences between federal standards and state law.

52 State legislators perform a critical role in the development of insurance public policy. 53 However, despite this important function, state legislators are oftentimes overlooked for 54 service on federal advisory boards and committees related to the regulation of the 55 business of insurance. Recognizing this recurring oversight, NCSL requests an

~ 36 ~ 56 enhanced effort from the federal government to incorporate state legislators onto 57 associated insurance advisory panels.

58 Insurance Company Solvency 59 The safety and soundness of insurance companies operating in the United States are 60 the prime objective of state insurance regulation. State legislatures have endeavored to 61 strengthen state insurance departments and to create standards for financial regulation 62 that have improved the solvency of insurance companies.

63 NCSL opposes any proposal to establish federal standards for state solvency regulation 64 that cedes any authority to federal agencies to regulate financial institutions involved in 65 the business of insurance, including congressional ratification of trade agreements that 66 would preempt state regulation of insurance for solvency purposes. Although NCSL 67 continues to support the National Association of Insurance Commissioners’ Financial 68 Regulation Standards and Accreditation Program, NCSL acknowledges that state 69 legislatures and governors have the responsibility to enact policy, which state regulators 70 enforce. NCSL recognizes that interstate compact proposals have the potential of 71 addressing binding uniformity and effectiveness in specific areas of regulation.

72 NCSL also objects to actions taken or contemplated by the Internal Revenue Service or 73 other federal agencies to assert priority claims to the assets of failed insurers. The 74 states should first be allowed to distribute an insolvent company's assets to pensioners, 75 family businesses, other policyholders and others protected by the McCarran-Ferguson 76 Act’s delegation of the business of insurance to the states.

77 In the same vein, NCSL is concerned by federal bankruptcy rulings under the federal 78 bankruptcy code that would allow alien insurers and reinsurers to move certain trust 79 fund assets to bankruptcy proceedings in their domicile country. The trust funds 80 established by alien insurers and reinsurers are to serve as collateral for insurance and 81 reinsurance underwriting in the United States. Federal bankruptcy rulings have allowed 82 such alien insurers and reinsurers to be exempt from state solvency regulation and

~ 37 ~ 83 have placed these collateral trust funds out of the reach of state insurance departments, 84 which are solely responsible for solvency protection. NCSL urges Congress to rectify 85 this situation by amending federal law to eliminate or limit this exemption for alien 86 insurers and reinsurers under the bankruptcy code.

87 Insurance Information Security 88 NCSL opposes any federal effort to preempt state laws and regulations or to enact 89 federal standards that address the use of financial and credit information in insurance.

90 INSURANCE FRAUD - FEDERAL CRIMINALIZATION 91 NCSL recognizes the toll that policyholder and claimant initiated fraud has on the cost of 92 insurance and the solvency of the insurer. We applaud the action taken in various states 93 to pass laws that make it more difficult to file a false claim, increase the penalties for 94 those who are guilty of fraudulent activities, and expand state insurance department 95 fraud units.

96 NCSL believes that the prosecution of policyholder and claimant fraud should and must 97 remain in the jurisdiction of state and local law enforcement officials. However, in cases 98 of internal insurer fraud that may be the result of interstate and international 99 conspiracies to defraud, loot or plunder an insurance company, states and the federal 100 government should cooperate to prosecute such criminal activity.

101 As a result of financial services modernization, the various federal and state financial 102 institutions regulators need to coordinate anti-fraud activities. However, federal 103 legislation to assist the coordination of state and federal anti-fraud activities should not 104 unnecessarily preempt state anti-fraud laws and regulations nor grant audit or subpoena 105 authority to a federal entity over a state agency operating under appropriate state 106 constitutions and laws.

107 NCSL's endorsement of federal involvement in the criminal prosecution of certain kinds 108 of insurance fraud does not diminish our support for continued state regulation of the

~ 38 ~ 109 insurance business. Federal criminal sanctions will assist state regulators in state efforts 110 to prevent future insolvencies.

111 EQUAL ACCESS TO FBI CRIMINAL HISTORY RECORDS 112 State regulators should have efficient access to the Federal Bureau of Investigation’s 113 (FBI) Criminal Justice Information System in order to establish dependable procedures 114 for licensing officers, directors, and agents of insurance companies across the United 115 States.

116 NCSL calls on Congress to give state insurance regulators statutory access to FBI 117 fingerprint files. This information is currently available to federal and state banking and 118 securities regulators. Access will help safeguard insurance consumers from the 119 unnecessary risk of having known fraud artists or violent offenders engaged in the 120 insurance business.

121 NATURAL DISASTER MITIGATION AND INSURANCE 122 NCSL urges Congressional action that would: (a) provide federal grants, tax credits or 123 deductions to assist consumers to strengthen their homes to better withstand 124 catastrophic natural disasters; and (b) create a commission to determine what other 125 action is necessary and appropriate to support and enhance the ability of existing 126 insurance and reinsurance mechanisms to cope with catastrophic natural disasters. 127 However, any such action must not displace private sector risk transfer mechanisms, 128 adversely impact a state's ability to levy premium taxes, regulate the business of 129 insurance and set solvency standards for property and casualty insurers.

130 TERRORISM RISK INSURANCE 131 NCSL requests Congress work with state insurance regulators to ensure that the 132 property and casualty insurance and group life insurance industries develop the 133 products to protect Americans from financial losses associated with terrorism and to 134 ensure an available and affordable insurance market for American consumers and 135 businesses.

~ 39 ~

136 NCSL continues to believe that any reauthorization of the Terrorism Risk Insurance Act 137 should recognize the temporary nature of the program, and therefore encourages efforts 138 to further promote development of the private insurance markets. Any federal plan for a 139 temporary and limited federal backstop for terrorism insurance coverage must not 140 adversely impact a state’s ability to levy premium taxes, regulate the business of 141 insurance and set solvency standards for property and casualty and group life insurers.

~ 40 ~ 1 COMMITTEE: COMMUNICATIONS, FINANCIAL SERVICES & 2 INTERSTATE COMMERCE 3 4 POLICY: INTERNET & ELECTRONIC COMMERCE 5 6 TYPE OF POLICY: DRAFT POLICY DIRECTIVE 7 8 THE INTERNET AND ELECTRONIC COMMERCE 9 The Internet defies a detailed one-size-fits-all approach to public policy and regulation. 10 America's federal and state lawmakers, as well as policy makers from other countries 11 should be guided by principles that foster the Internet's development while protecting 12 the security and privacy of individual users.

13 Our nation's state legislatures are well aware of the impact that access to the Internet 14 and electronic commerce have on the economic vitality of our states and communities. 15 State legislatures also recognize that the marketplace for electronic commerce is not 16 just in the United States but is present in the vast global market. State legislatures share 17 the concern of many in Congress that ill-conceived over-regulation and taxation of the 18 Internet and electronic commerce services could harm our nation's ability to compete 19 globally. However, state legislatures also recognize that they have an obligation to act, 20 when and if necessary, to protect the general welfare of their constituents. As the use of 21 the Internet continues to expand, any future or existing regulations must be balanced 22 against market forces in a competitive and technologically neutral manner, as 23 government must not choose the winners or losers of the digital age.

24 Nothing in this policy statement is to be construed as limiting or affecting the right of any

25 state to regulate alcohol according to its local norms and standards pursuant to the 21st 26 Amendment.

27 NCSL opposes unnecessary or unwarranted federal legislation or regulation that would 28 impede efforts by states to promote access to the Internet, enhance competition or

~ 41 ~ 29 increased consumer choice or ensure the security of personal information of consumers 30 conducting electronic commerce transactions.

31 The National Conference of State Legislatures (NCSL) supports the following principles 32 in formulating laws and regulations that impact the Internet and electronic commerce:

33 Privacy and Security 34 Every American should be empowered to protect their privacy and personal information 35 from intrusion or piracy. While NCSL recognizes that there is a need for Congress to act 36 to establish a national policy to protect the personal information of Americans, state 37 legislatures, in the absence of any action by Congress and the federal government, 38 have moved to fill the void. NCSL calls upon the Congress to enact federal Internet 39 privacy legislation that ensures the security of Americans’ personal information with the 40 least amount of government regulation as possible. However, NCSL opposes federal 41 legislation that seeks to preempt existing state statutes and regulations governing 42 privacy protections and security for non-Internet based transactions.

43 Free Speech 44 The Internet allows people to communicate and share ideas with others with an ease 45 never before possible. Federal government policy should rigorously protect freedom of 46 speech and expression on the Internet, but not restrict states or local governments from 47 oversight protecting freedom of speech. New technologies should adequately enable 48 individuals, families and schools to protect themselves and students from 49 communications and materials they deem offensive or inappropriate. State law 50 enforcement, with federal assistance and resources, must be able to enforce criminal 51 statutes against predators that use the Internet to harm or abuse children.

52 Self-governance 53 NCSL requests the Congress to maintain the current self-governance approach that 54 allows the competitive marketplace to drive broadband and broadband-related 55 applications development and deployment. Congress should avoid adopting new

~ 42 ~ 56 mandates and provide the Federal Communications Commission (FCC) with defined 57 and limited authority to oversee, but not proactively intervene in, the broadband Internet 58 marketplace consistent with principles that focus on assessing whether the market 59 continues to ensure that consumers can:

60 (1) receive meaningful information regarding their broadband service plans;

61 (2) have access to their choice of legal Internet content, subject to the limits on 62 bandwidth and quality of service of their service plan;

63 (3) run applications of their choice, subject to the needs of law enforcement and 64 the limits on bandwidth limits and quality of service of their service plans, as long 65 as they do not harm the provider’s network or interfere with other consumers’ use 66 of the broadband service; and

67 (4) be permitted to attach any devices they choose to their broadband connection 68 at the consumer’s premise, so long as they operate within the limits on bandwidth 69 and quality of service of their service plans and do not harm the provider’s 70 network, interfere with other consumers’ use of the broadband service, or enable 71 theft of services.

72 Consumer Protection 73 Industry self-regulation has made an important contribution to the development of 74 electronic commerce. Industry technologies and best practices, combined with the 75 enactment of strong state laws which outlaw deceptive practices and fraudulent online 76 behavior, are essential elements in promoting electronic commerce and enhancing 77 consumer protection. Privacy and consumer protection continue to be priority issues in 78 state legislatures.

79 NCSL supports the efforts of state legislatures to develop new policy initiatives to 80 protect consumers online, especially when the federal government fails to respond to

~ 43 ~ 81 consumers’ concerns. NCSL also recognizes that because of the global nature of the 82 Internet that states must seek cooperative federal action to further enhance consumer 83 protection, privacy and information security. Federal legislation must ensure the 84 authority of state attorneys general to enforce federal statutes protecting consumers. 85 However, NCSL opposes any attempt by Congress to restrict the states’ ability to 86 impose criminal and/or civil penalties for illegal activity that may occur over the Internet.

87 Growth 88 Public policies must be designed to foster continuing expansion of useful and affordable 89 bandwidth, encourage development of innovative technologies and promote broad 90 universal access. Federal and state governments must work together to ensure that all 91 Americans, regardless of where they live, have competitive access to high-speed 92 broadband technologies. Government must work to guarantee open and competitive 93 markets for broadband services.

94 Information Technology 95 Information technology (IT) is a global industry. A strong American IT industry enhances 96 and strengthens the economic well being of our states and nation. 97 States and the federal government must work together to ensure a climate that allows 98 America’s IT companies to continue to perform research and technology development, 99 to generate innovative new products and services and to solve customer problems. 100 States must have the unfettered ability to continue to seek ways to use IT to better the 101 lives of their residents. Therefore, NCSL opposes any attempt by the federal 102 government to restrict or penalize states’ efforts to utilize information technology 103 services and products that allow states to provide more efficient government services to 104 residents at lower costs to taxpayers.

105 Internet Gambling 106 Congress must respect the sovereignty of states to allow or to prohibit Internet gambling 107 by their residents.

~ 44 ~ 108 Electronic Commerce and Taxation 109 Government policies should create a workable infrastructure in which electronic 110 commerce can flourish. Policy makers must resist any temptation to apply tax policy to 111 the Internet in a discriminatory or multiple manner that hinders growth. Government tax 112 systems should treat transactions, including telecommunications and electronic 113 commerce, in a competitively neutral and non-discriminatory manner. The federal 114 government and America’s industries should work with state legislatures in ensuring 115 equal tax treatment of all forms of commerce and should encourage state efforts to 116 achieve simplification and uniformity through the streamlining of state and local sales 117 and telecommunications tax systems.

118 NCSL supports the reform of the discriminatory taxation of communications services 119 and believes that if state and local governments were to take such action, the need for 120 the federal moratorium on Internet access would cease to exist. 121 Since 2003 NCSL has maintained a neutral position on the extension of the moratorium 122 and continues to do so. However, should the moratorium be extended, it is consistent 123 with NCSL policy that the moratorium be competitively neutral and apply equally to all 124 media used to access the Internet.

125 VIDEO FRANCHISE REFORM 126 Innovation and convergence of existing technologies are radically expanding 127 communications and information services, blurring distinctions between telephone, 128 Internet services, cable, wireless and satellite. These rapid changes often outpace 129 abilities of federal, state and local regulatory regimes to adapt. It is important that video 130 regulatory policy assure that like services are treated alike, investment is encouraged, 131 and services are in a non-discriminatory manner.

132 State Administration Will Preserve State Authority 133 Local jurisdictions are the creation of either state constitutions or law. The powers that 134 these political subdivisions of the state exercise were granted to them over time by state 135 legislatures. Those local jurisdictions that have franchise authority have it as a result of

~ 45 ~ 136 state legislation or the state constitution. Therefore, any attempt by Congress to 137 preempt current local franchise authority is a preemption of state sovereignty. 138 While NCSL rarely advocates the consideration of legislation in state legislatures, NCSL 139 has at times, when states are facing a crisis or a serious threat of federal preemption, 140 urged state legislatures to take action. NCSL endorses efforts that remove barriers to 141 entry for or inequity of regulation among video competitors and foster additional 142 consumer choices in the video marketplace ultimately ensuring competitive neutrality. 143 Government should encourage competition and consumer choices for broadband and 144 video services and promote the deployment of broadband services and technologies.

145 Fees and Taxation of Video Providers 146 Franchise fees today are levied, imposed or collected as a percentage of gross 147 revenues, used for general revenue purposes and not based on the actual direct and 148 identifiable costs of any benefit to the entity that pays the fee. To the extent such fees 149 are intended as payment for use of public rights-of-way, that fee should be limited to the 150 actual, direct and identifiable cost of such use, and that portion of the fee should be 151 applied only to those who use the rights-of-way. Franchise fees should be collected and 152 administered by one central agency per state.

~ 46 ~ 1 COMMITTEES: EXECUTIVE COMMITTEE TASK FORCE ON STATE & 2 LOCAL TAXATION 3 COMMUNICATIONS, FINANCIAL SERVICES & 4 INTERSTATE COMMERCE 5 6 POLICY: REMOTE COMMERCE 7 8 TYPE: DRAFT POLICY DIRECTIVE 9 10 The 1967 Bellas Hess and the 1992 Quill Supreme Court decisions denied states the 11 authority to collect sales and use taxes by out-of-state sellers that have no physical 12 presence or nexus in the taxing states, holding that legislation by Congress is required 13 to create such authority. One recent report has estimated that states will lose over $23 14 Billion in uncollected sales tax revenues in 2012, of which $11.4 billion is from electronic 15 commerce, and that annual losses will continue to grow as more commerce is 16 conducted online. This disconnect with remote commerce threatens to erode the 17 viability of the sales tax as a revenue source for state and local governments. States 18 have requested Congressional action, but Congress has failed to close this large 19 loophole in the states’ sales and use tax system.

20 NCSL calls on Congress to require all sellers, regardless of location, to collect sales 21 taxes and remit them to the state to which they are due. Further, NCSL supports a small 22 business exception.

23 Acknowledging that the complexity of multiple tax rates places a significant burden on 24 out-of-state sellers, twenty-four states joined the Streamlined Sales Tax and Use 25 Agreement and passed laws to simplify sales and use tax systems, remove burdens to 26 interstate sellers, and collaborate on the collection of taxes due to them.

~ 47 ~ 27 NCSL calls on Congress to pass legislation overturning the Bellas Hess and Quill 28 decisions, affirming the states’ sovereign right to enter into such agreements, and 29 granting states the authority denied to them by the Court’s decisions.

~ 48 ~ 1 COMMITTEES: COMMITTEE ON BUDGETS AND REVENUE 2 COMMITTEE ON COMMUNICATIONS, FINANCIAL SERVICES 3 AND INTERSTATE COMMERCE 4 5 TITLE: STATE SOVEREIGNTY IN ONLINE GAMING 6 7 TYPE: RESOLUTION - DRAFT 8 9 The National Conference of State Legislatures (NCSL) believes the federal government 10 must respect the sovereignty of states to allow or to prohibit Internet gambling by their 11 residents.

12 The recent ruling by the United States Justice Department on the Federal Wire Act of 13 1961, 18 U.S.C. §1084, clarifies that intra-state online gambling is lawful. Any effort by 14 Congress or the administration to reverse this ruling is preemptive and diminishes the 15 flexibility of state legislatures to be innovative and responsive to the unique needs of the 16 residents of each state.

17 NCSL requests Congress consider the perspective of the states as it examines this 18 issue and asks that it involve state legislators in any federal efforts that seek to reform 19 the regulation of online gaming. NCSL strongly opposes any effort by the federal 20 government to overturn the Justice Department’s ruling or consideration of legislation 21 overruling state authority by legalizing or regulating gambling at the federal level. NCSL 22 also requests that federal lawmakers be respectful of state legislatures that prohibit 23 online gaming or other forms of gaming within their state.

~ 49 ~ 1 COMMITTEES: COMMUNICATIONS, FINANCIAL SERVICES & 2 INTERSTATE COMMERCE

3 BUDGETS AND REVENUE

4 TASK FORCE ON STATE AND LOCAL TAXATION

5 POLICY: NATIONAL CONFERENCE OF STATE 6 LEGISLATURES SUPPORTS AND URGES 7 ENACTMENT OF THE MARKETPLACE FAIRNESS 8 ACT 9 10 TYPE OF POLICY: DRAFT RESOLUTION

11 WHEREAS, the 1967 Bellas Hess and the 1992 Quill Supreme Court decisions 12 denied states the authority to require the collection of sales and use taxes by out- 13 of-state sellers that have no physical presence in the taxing state; and

14 WHEREAS, the combined weight of the inability to collect sales and use taxes 15 due on remote sales through traditional carriers and the tax erosion from 16 electronic commerce threatens the future viability of the sales tax as a stable 17 revenue source for state and local governments; and

18 WHEREAS, a report from the Center for Business Research at the University of 19 Tennessee has estimated that in fiscal year 2012, states will lose over $23 billion 20 in uncollected sales tax revenues from out of state sales; and

21 NOW, THEREFORE BE IT RESOLVED THAT, the National Conference of State 22 Legislatures supports the Marketplace Fairness Act, introduced by Senators 23 Durbin of Illinois and Enzi of Wyoming that authorizes each member state under 24 the Streamlined Sales and Use Tax Agreement to require all sellers not 25 qualifying for a small-seller exception to collect and remit sales and use taxes 26 with respect to remote sales and allows a state that is not a member state under 27 the Agreement to require sellers to collect and remit sales and use taxes with

~ 50 ~ 28 respect to remote sales sourced to such state if the state adopts and implements 29 certain minimum simplification requirements; and

30 BE IT FURTHER RESOLVED THAT, the National Conference of State 31 Legislatures calls upon the Congress to move swiftly to consider and approve the 32 Marketplace Fairness Act that grants states collection authority and provides $23 33 billion in fiscal relief to the states without a dime coming from the U.S. Treasury; 34 and

35 BE IT FURTHER RESOLVED THAT, the National Conference of State 36 Legislatures urges the President to sign the Marketplace Fairness Act that grants 37 states collection authority into law, upon its passage by the Congress; and

38 BE IT FURTHER RESOLVED THAT, a copy of this resolution be sent to the 39 President of the United States and to all the members of Congress.

~ 51 ~ 1 COMMITTEE: COMMUNICATIONS, FINANCIAL SERVICES & 2 INTERSTATE COMMERCE

3 POLICY: RESOLUTION SUPPORTING INTELLECTUAL 4 PROPERTY (IP) RIGHTS AND PROTECTIONS TO 5 PROMOTE PRODUCTIVITY, COMPETITIVENESS, 6 JOBS, AND PUBLIC HEALTH

7 TYPE OF POLICY: DRAFT RESOLUTION

8 WHEREAS, Intellectual property (IP) rights and innovation are primary drivers of 9 job creation and America’s economic growth. 10 11 WHEREAS, over 55 million jobs are directly and indirectly supported by IP- 12 intensive industries as a significant driver of GDP, exports, and wages in every 13 state of the Union.

14 WHEREAS, IP-intensive industries are responsible for $5.8 trillion in private 15 sector output (GDP).

16 WHEREAS, in a 2012 economic study by the U.S. Department of Commerce that 17 ties employment and value-added numbers to IP-intensive industries, IP- 18 intensive industries pay workers 42% higher wages than those of non IP- 19 intensive industries.

20 WHEREAS, IP-intensive industries drive American exports accounting for 21 approximately $1 trillion (74% of total U.S. exports in 2011)

22 WHEREAS, given the important role that IP plays in sustaining a long-term 23 economic growth, policymakers should give high priority to fostering innovation 24 and protecting intellectual property; and

~ 52 ~ 25 WHEREAS, protecting and enforcing the IP rights of businesses are critical to 26 advancing global economic recovery, driving competitiveness and export growth, 27 and creating high-quality jobs; and

28 WHEREAS, the National Conference of State Legislatures believes that 29 widespread efforts to promote innovation and intellectual property protection are 30 critical to improving the nation’s long-term competitiveness in a global market, 31 and to achieving certain socioeconomic improvements in the quality of American 32 life; and

33 NOW, THEREFORE LET IT BE RESOLVED, that the National Conference of 34 State Legislatures calls upon all levels of governments to work cooperatively with 35 the private sector, nonprofits, and academia to create, develop and implement 36 robust pro-IP awareness and enforcement; and

37 BE IT FURTHER RESOLVED, the National Conference of State Legislatures 38 supports efforts to ensure the IPEC has sufficient staff, budget, and authority to 39 fulfill the obligations and achieve the goals outlined in the PRO-IP Act and the 40 National IP Strategy; and

41 BE IT FURTHER RESOLVED, the National Conference of State Legislatures 42 support robust IP protection and enforcement provisions in trade agreements and 43 their implementation (specifically the Trans-Pacific Partnership Agreement (TPP)/ 44 KORUS); and

45 BE IT FURTHER RESOLVED THAT, the National Conference of State 46 Legislatures supports existing efforts to shut down the top illegal rogue websites 47 globally that are willfully selling counterfeit goods and facilitating digital theft; and

48 BE IT FURTHER RESOLVED THAT, a copy of this resolution be sent to the 49 President of the United States and all members of the 112th Congress.

~ 53 ~ 1 COMMITETE: COMMUNICATIONS, FINANCIAL 2 SERVICES & INTERSTATE COMMERCE

3 POLICY: NCSL OPPOSES FEDERAL 4 CONTACTLESS TECHNOLOGY 5 MANDATES FOR STATE ISSUED 6 IDENTIFICATION DOCUMENTS

7 TYPE OF POLICY: DRAFT RESOLUTION

8 WHEREAS, the federal government is taking a more active role in influencing 9 and determining the technological standards for state issued identification 10 documents such as drivers licenses. The federal government is attempting to 11 influence or mandate the technological standards of sovereign state issued 12 identification documents through the direct acts of Congress, the rule-making 13 processes of the Departments of State and Homeland Security, or through both 14 official or informal agreements with international organizations or initiatives such 15 as the American Association of Motor Vehicle Administrators (AAMVA), the 16 Security and Prosperity Partnership (SPP), and the United Nation’s agency 17 known as the International Civil Aviation Organization (ICAO).

18 WHEREAS, an example contrary to the tenets of federalism, the initial version of 19 the federal REAL ID Act as introduced would have required the states to enter 20 into the AAMVA compact known as the Driver’s License Agreement (DLA). This 21 compact as drafted would put the non-governmental 501c3 AAMVA, which has 22 foreign voting members, in charge of making the technology decisions for a 23 state’s sovereign drivers licenses. Such federal decisions would allow for 24 AAMVA, and not the States, to determine whether or not bar code or contactless 25 technology must be employed, whether or not such data could be encrypted, 26 what biometrics would need to be encoded, and whether or not the data could be 27 shared with foreign governments. ~ 54 ~

28 WHEREAS, an example contrary to the tenets of federalism, the final rules for 29 both REAL ID and the Western Hemisphere Travel Initiative (WHTI) were 30 published in 2008, and mandated standards onto states’ driver’s licenses for 31 them to be acceptable for certain uses. The Department of Homeland Security is 32 currently requiring states to embed unencrypted contactless technology into a 33 state’s drivers licenses in order for citizens to be able to use them to get back 34 into the United States at international ground crossings. This places specific 35 technological choices as having equal importance over the roles of identification 36 and proof of citizenship, while leaving states with no flexibility or options in this 37 area if they want to pursue an Enhanced Drivers License (EDL) that does not use 38 contactless technology, wishes to employ encrypted contactless technology, or 39 wishes to employ shorter range contactless technology than what is being 40 mandated. The goal of WHTI deals simply with providing proof of citizenship, not 41 dictating the technology by which that proof must be conveyed.

42 WHEREAS, an example contrary to the tenets of federalism, the final rules for 43 REAL ID, page 86, make clear that the federal government is not satisfied with a 44 onetime mandate and wishes to have this control in perpetuity going forward: 45 “Moreover, in the future, DHS, in consultation with the States and DOT, may 46 consider technology alternatives to the PDF417 2D bar code that provide greater 47 privacy protections after providing for public comment”. The “final rules” are 48 therefore not really final, and it is unacceptable that such technological decisions 49 could be made by requiring only non-binding consultation with States, especially 50 when there is debate between the States and the federal government as to what 51 really constitutes optimal privacy and security options for their driver’s licenses.

52 WHEREAS, a driver’s license is a sovereign state document, and whether or not 53 bar code or contactless technology must be employed, should remain a State 54 decision. The federal government should not use the WHTI, a policy of its own

~ 55 ~ 55 devising, as an economic cudgel to coerce states into accepting such 56 technological standards onto their sovereign driver’s licenses.

57 THEREFORE, LET IT BE RESOLVED, that the NCSL will urge the President, 58 Congress, and the Departments of State, Transportation, and Homeland Security 59 to not pass law, allow for federal policy, use international organizations, or enter 60 into international agreements that mandate or attempt to indirectly influence the 61 use of contactless technology in state or local identity documents.

~ 56 ~ COMMITTEE: COMMUNICATIONS, FINANCIAL SERVICES & INTERSTATE COMMERCE

POLICY: NCSL RESOLUTION IN SUPPORT OF STATE PUBLIC AFFAIRS NETWORKS

TYPE OF POLICY: DRAFT MEMORIAL RESOLUTION

WHEREAS, the operations of state governments and the roles of elected officials are often little understood by citizens. Yet public understanding of the institutions and processes of government is critical to building public trust and confidence. State governments need to bring about a better understanding of the concepts of representative democracy.

WHEREAS, a growing number of states have created or supported the creation of state public affairs television networks whose charge it is to offer unfiltered, gavel-to-gavel coverage of legislative sessions, committee proceedings and similar actions within the executive and judicial branches. By providing an “open window” on the workings of their state governments, these independent networks have increased citizen access, public trust and understanding of both the governmental and the public policy process at large.

WHEREAS, the National Association of Public Affairs Networks (NAPAN) has been conceived to help establish and expand nationally such noncommercial, independent television networks devoted to providing citizens with fair, balanced, and unfiltered access to their state governments: to foster and nurture the institutions that will help create the informed electorate that will shape our democracy in the years to come. NAPAN is committed to the launch and viability of networks in all 50 states.

NOW, THEREFORE BE IT RESOLVED, the National Conference of State Legislatures supports and encourages the efforts of the National Association of Public Affairs

~ 57 ~ Networks in its vision for the formation and expansion of a state public affairs network in each of the 50 states in the manner most appropriate for each individual state.

~ 58 ~