Chapter
332
2006 -- S 2139 SUBSTITUTE A AS AMENDED
Enacted 07/04/06
A N A
C T
RELATING TO
SEPARATION OF POWERS
Introduced By: Senators
Lenihan, Blais, and Paiva-Weed
Date Introduced: January
24, 2006
It is
enacted by the General Assembly as follows:
SECTION
1. Section 19-1-2 of the General Laws in Chapter 19-1 entitled
"Definitions
and
Establishment of Financial Institutions" is hereby amended to read as
follows:
19-1-2.
Board of bank incorporation. -- (a) The (i) There is hereby
authorized, created
and
established within the department of business regulation a five (5) member
board of bank
incorporation,
(hereinafter the “board”), all of whom shall be voting members and serve
without
compensation.
Three (3) who serve as ex-officio shall be the director of the department of
business
regulation (hereinafter the “director”)
director or his or her designee, the general
treasurer
or his or her designee, and the attorney general or his or her designee.,
one member of
the
house of representatives, to be appointed by the speaker, and one member of the
senate, to be
appointed
by the president of the senate, shall constitute a board of bank incorporation, The other
two
(2) members of the board shall be members of the general public qualified by
training or
experience
in the fields of finance or banking, appointed by the governor with the advice
and
consent
of the senate. In appointing public members pursuant to this section, the
governor shall
solicit
and give due consideration of the recommendations of the general treasurer with
respect
thereto.
The designee of a member serving as ex-officio shall be a subordinate from
within the
department
of the ex-officio member and shall represent him or her at all meetings of the
board.
No
one shall be eligible for public appointment unless he or she is a resident of
this state. The
board
shall elect a chair and may elect from among its own members such other
officers as they
deem
necessary.
(ii) The board is a public policy appellate board established to
consider appeals from a
decision
of the director or the director's designee concerning major banking matters
which affect
the
citizens and tax base of the state and to exercise the powers and perform the
duties conferred
or
imposed upon it by this title.
(iii)
Newly appointed and qualified public members and designees of ex-officio
members
shall, within six (6) months of their qualification or designation, attend a
training course
that
shall be developed with board approval and conducted by the director or his or
her designee
and
shall include instruction in the provisions of chapters 19-1, 42-46,
36-14, and 38-2 of Rhode
Island
general laws; and the board’s rules and regulations. The director of the
department of
administration
shall, within ninety (90) days of the effective date of this act, prepare and
disseminate
training materials relating to the provisions of chapters 42-46, 36-14 and
38-2.
(iv) Public members of the board shall be removable by the appointing
authority for
cause
only, and removal solely for partisan or personal reasons unrelated to capacity
or fitness for
the
office shall be unlawful.
(v)
Three (3) members of the board of bank incorporation shall constitute a quorum
for
the
transaction of business. A majority vote of those present shall be required
for action. No
vacancy
in the membership of the board shall impair the right of a quorum to exercise
all of the
rights
and perform all of the duties of the board. Any vacancy which may occur in the
board shall
be
filled by the governor with the advice and consent of the senate, for the
remainder of the
unexpired
term in the same manner as the member's predecessor as prescribed in this
section.
(vi) Those members of the board as of the effective date of this act who are
members of
the
general assembly shall cease to be members of the board on the effective date
of this act, and
the
governor shall thereupon nominate one new member who shall serve an initial
term of three
(3)
years and one new member who shall serve an initial term of four (4) years.
Thereafter, all
appointed
members of the board shall be appointed to terms of four (4) years and be
eligible for
reappointment.
(b)(i) The board of bank incorporation may adopt, and amend from time to
time, rules
and
regulations for the orderly conduct of its affairs and for the administration
of its duties
pursuant
to this title. The board of bank incorporation shall collect a filing fee with
respect to
applications
submitted to it. All fees pursuant to this section shall be paid to the
director, to and
for the
use of the board of bank incorporation. The fees to be charged for each type of
application
shall be
established annually at the board of bank incorporation's first public hearing.
The board
of bank
incorporation shall publish notice of its proposed fee structure at least once
a week for
three
(3) successive weeks in a newspaper of general circulation.
(ii)
Within ninety (90) days after the end of each fiscal year during which the
board has
conducted
business, the board shall approve and submit an annual report to the governor,
the
speaker
of the house of representatives, the president of the senate, and the secretary
of state of its
activities
during that fiscal year. The report shall provide: an operating statement
summarizing
meetings
or hearings held, meeting minutes if requested, subjects addressed, decisions
rendered,
rules
or regulations promulgated, studies conducted, policies and plans developed,
approved, or
modified,
and programs administered or initiated; a consolidated financial statement of
all funds
received
and expended including the source of the funds, a listing of any staff
supported by these
funds,
and a summary of any clerical, administrative or technical support received; a
summary of
performance
during the previous fiscal year including accomplishments, shortcomings and
remedies;
a synopsis of hearings, complaints, suspensions, or other legal matters related
to the
authority
of the board; a summary of any training courses held pursuant to subsection
19-1-2
(a)(iv);
a briefing on anticipated activities in the upcoming fiscal year; and findings
and
recommendations
for improvements. The report shall be posted electronically on the general
assembly
and the secretary of state’s websites as prescribed in section 42-20-8.2 of the
Rhode
Island
general laws. The director of the department of administration shall be responsible
for the
enforcement
of this provision.
SECTION
2. Sections 16-57-6.5 and 16-57-7 of the General Laws in Chapter 16-57
entitled
"Higher Education Assistance Authority" are hereby amended to read as
follows:
16-57-6.5.
Annual audited financial report to the governor and general assembly. –
(a) The authority, in conjunction with the general
treasurer and the executive director of the
Rhode
Island student loan authority, shall
submit to the governor, and the general assembly the
speaker
of the house of representatives, the president of the senate, and the secretary
of state an
annual
audited financial report, prepared in accordance with generally accepted
accounting
principles,
on the operations of the tuition savings program by November 1 of each year.
The
annual
audit shall be made either by the auditor general or by an independent
certified public
accountant
approved by the auditor general and shall include direct and indirect costs
attributable
to the
use of outside consultants, independent contractors, and any other persons who
are not state
employees.
(b)
The annual audit audited financial report shall be supplemented
by the following
information,
to be submitted by April 1 of each year, on the operations of the program for
the
previous
calendar year:
(1) Any studies or evaluations prepared in the subject year; A
summary of meetings or
hearings
held, meeting minutes, subjects addressed, decisions rendered, rules or
regulations
promulgated,
studies conducted, policies and plans developed, approved, or modified, and
programs
administered or initiated; and a summary of any clerical, administrative or
technical
support
received; a summary of performance during the previous fiscal year including
accomplishments,
shortcomings and remedies; a synopsis of hearings, complaints, suspensions or
other
legal matters related to the authority of the board; a summary of any training
courses held
pursuant
to subsection 16-57-7(a)(2); a briefing on anticipated activities in the
upcoming fiscal
year;
and findings and recommendations for improvements;
(2) A summary of the benefits provided by the tuition savings program including
the
number
of participants and beneficiaries; and
(3) Any other information which is relevant in order to make a full, fair and
effective
disclosure
of the assets and operations of the program.; and
(4)
The foregoing supplemental information shall be posted electronically on the
general
assembly's
and the secretary of state's websites as prescribed in section 42-20-8.2 of the
Rhode
Island
general laws. The director of the department of administration shall be
responsible for the
enforcement
of this provision.
16-57-7. Directors, officers, and employees. -- (a) (1)
The powers of the authority
shall be
vested in a board of directors consisting of nine (9) members, five (5) members
of whom
to be shall be appointed by the governor from
among members of the general public, who are
qualified
by training or experience in education finance or personal investment
consulting and
made
in accordance with subsection (b) of this section; and six (6) members serving ex officio,
who
shall be the chairperson of the finance committees of the senate and house of
representatives
or
their designees, and two (2) members of the board of governors for higher
education three (3)
of
whom shall be appointed by the governor,
who shall give due consideration to the
recommendations
made by the chairperson of the board
of governors for higher education and by
the
Rhode Island Independent Higher Education Association for those appointments; , and the
state general
treasurer ex-officio or his or her designee who shall be a subordinate from
within the
office
of the general treasurer, and the
chairperson of the Rhode Island Independent Higher
Education
Association or their designees. All
gubernatorial appointments made to this board shall
be
subject to the advice and consent of the senate. All board members first appointed
to the board
after
the effective date of this act shall be residents of this state. Designees of
members serving
ex-officio
shall represent him or her at all meetings of the board. Except for the
chairpersons of
the
house and senate finance committees or their designees who shall cease to be
members of the
authority
upon the effective date of this act, Each
each member shall serve until his or her
successor
is appointed and qualified. The original members appointed by the governor
shall be
appointed
in a manner as to provide for the expiration of the term of one member on the
first day
of July
of each year. The governor may remove any member appointed by him or her for
misfeasance,
malfeasance, or nonfeasance in office.
(2) Newly appointed and qualified public members and designees of ex-officio
members
shall,
within six (6) months of their qualification or designation, attend a training
course that shall
be developed
with board approval and conducted by the chair of the board and shall include
instruction
in the following areas: the provisions of chapters 16-57, 42-46, 36-14 and
38-2; and
the
board’s rules and regulations. The director of the department of administration
shall, within
ninety
(90) days of the effective date of this act, prepare and disseminate training
materials
relating
to the provisions of chapters 42-46, 36-14 and 38-2.
(3)
Public members of the board shall be removable by the appointing authority for
cause
only,
and removal solely for partisan or personal reasons unrelated to capacity or
fitness for the
office
shall be unlawful.
(b)
During the month of June of each year, the governor shall appoint a member to
succeed
the member whose term will then next expire to serve for a term of five (5)
years
commencing
on the first day of July then next following, and after this, until a successor
is
appointed
and qualified. As soon as practicable after the effective date of this act,
the governor
shall
appoint a member to serve an initial term to expire on July 1, 2010.
Thereafter, all members
appointed
by the general treasurer shall be appointed to terms of five (5) years, and the
governor
shall,
during the month of June preceding the expiration of each term, appoint a
member whose
term
will then next expire. In the event
of a vacancy occurring in the office of a member by death,
resignation,
removal, or otherwise, the vacancy shall be filled in the same manner as an
original
appointment
but only for the remainder of the term of the former member.
(c) The directors shall receive no compensation for the performance of their
duties
under
this chapter, but each director shall be reimbursed for his or her reasonable
expenses
incurred
in carrying out the duties. A director may engage in private employment or in a
profession
or business.
(d) Upon appointment and qualification of the original board of directors, and
during
the
month of July of each year after this, the board of directors shall elect one
of its members to
serve as
chairperson. The board may elect from among its members such other officers
as they
deem
necessary. Five (5) directors shall
constitute a quorum and any action to be taken by the
authority
under the provisions of this chapter may be authorized by resolution approved
by a
majority
of the directors present and voting at any regular or special meeting at which
a quorum
is present.
A vacancy in the membership of the board of directors shall not impair the
right of a
quorum
to exercise all the rights and perform all the duties of the authority.
(e)
(1) In addition to electing a chairperson, the board of directors shall appoint
a
secretary
and any additional officers and staff members as they shall deem appropriate.
The board
of
directors shall appoint an executive director who shall be in the unclassified
service and vest in
that
person or his or her subordinates the authorization to appoint additional staff
members who
shall be
in the classified service and to determine the amount of compensation each
individual
shall
receive. Those persons who were regularly established full time employees of
the authority,
prior to
March 27, 1979, and who are required to be in the classified service may be
placed in
appropriate
classifications within the classified service without the requirement of
competitive
examination
(as approved by the executive director). All employees hired after March 27,
1979,
will be
hired in accordance with the requirements of the classified service for
examination,
approved
state lists, and other procedures of the state division of personnel. Those
persons who
were
regularly established full time employees of the authority, prior to March 27,
1979, shall
have the
right to purchase retirement credits for the period commencing November 1,
1977, to
March
27, 1979, at the its full actuarial cost.
(2) Any employee in either the classified or unclassified service who was,
prior to his or
her
hiring by the authority, a participant in the retirement program adopted for
personnel at any
state or
private college shall have the option to either remain with that retirement
program while
an
employee of the authority or become a participant in the employees' retirement
system of the
state.
(f)
No full time employee shall during the period of his or her employment by the
authority
engage in any other private employment, profession, or business, except with
the
approval
of the board of directors; provided, that the executive director shall not
engage in any
other
private employment, profession, or business, including, but not limited to
consulting.
(g)
Notwithstanding any other law to the contrary, it shall not be or constitute a
conflict
of
interest for a director, officer, or employee of any financial institution,
investment banking
firm,
brokerage firm, commercial bank, trust company, savings and loan association,
credit union,
insurance
company, educational institution, or any other firm, person, or corporation to
serve as a
director
of the authority, nor shall any contract or transaction between the authority
and any
financial
institution, investment banking firm, brokerage firm, commercial bank, trust
company,
savings
and loan association, credit union, insurance company, educational institution,
or any
other
firm, person, or corporation be void or voidable by reason of any service as
director of the
authority.
If any director, officer, or employee of the authority shall be interested
either directly or
indirectly,
or shall be a director, officer, or employee of or have an ownership interest
(other than
as the
owner of less than one percent (1%) of the shares of a publicly held
corporation) in any
firm or
corporation interested directly or indirectly in any contract with the
authority, the interest
shall be
disclosed to the authority and set forth in the minutes of the authority, and
the director,
officer,
or employee having interest in this shall not participate on behalf of the
authority in the
authorization
of any contract. Interested directors may be counted in determining the
presence of
a quorum
at a meeting of the board of directors of the authority which authorizes the
contract or
transaction.
(h)
Any action taken by the authority under the provisions of this chapter may be
authorized
by vote at any regular or special meeting, and each vote shall take effect
immediately. (i)
The board of directors may designate from among its members an executive
committee
and one or more other committees each of which, to the extent authorized by the
board
of
directors, shall have and may exercise all the authority of the board of
directors, but no
committee
shall have the authority of the board of directors in reference to the
disposition of all
or
substantially all the property and assets of the authority or amending the
bylaws of the
authority.
SECTION
3. Section 16-62-7 of the General Laws in Chapter 16-62 entitled "The
Rhode
Island
Student Loan Authority" is hereby amended to read as follows:
16-62-7.
Directors, officers, and employees. -- (a) The powers of the authority
shall be
vested
in a board of directors consisting of seven (7) members as follows: six (6)
five (5)
members
appointed by the governor to the Rhode Island higher education assistance
authority
from
among members of the general public
as provided in section 16-57-7, all appointments
subject
to the advice and consent of the senate; and the general treasurer, ex-officio.
The general
treasurer
may designate a subordinate within his or her department or agency to represent
him or
her at
all meetings of the board.
(b) The directors shall receive no compensation for the performance of their
duties under
this
chapter, but each director shall be reimbursed for his or her reasonable
expenses incurred in
carrying
out those duties. A director may engage in private employment, or in a profession
or
business.
(c) The board of directors shall elect one of its members to serve as
chairperson. Four (4)
directors
shall constitute a quorum and any action to be taken by the authority under the
provisions
of this chapter may be authorized by resolution approved by a majority of the
directors
present
and voting at any regular or special meeting at which a quorum is present. A
vacancy in
the
membership of the board of directors shall not impair the right of a quorum to
exercise all the
rights
and perform all the duties of the authority.
(d) In addition to electing a chairperson, the board of directors shall appoint
a secretary
and any
additional officers and staff members as they shall deem appropriate and shall
determine
the amount
of compensation, if any, each shall receive. The board of directors may appoint
a
chief
executive officer and vest in that person or his or her subordinates the
authority to appoint
additional
staff members and to determine the amount of compensation each individual shall
receive.
(e) No fulltime employee shall during the period of his or her employment by
the
authority
engage in any other private employment, profession, or business, including, but
not
limited
to, consulting.
(f) Notwithstanding any other law to the contrary, it shall not be or
constitute a conflict
of
interest for a director, officer, or employee of any financial institution,
investment banking
firm,
brokerage firm, commercial bank, trust company, savings and loan association,
credit union,
insurance
company, educational institution, or any other firm, person, or corporation to
serve as a
director
of the authority nor shall any contract or transaction between the authority
and any
financial
institution, investment banking firm, brokerage firm, commercial bank, trust
company,
savings
and loan association, credit union, insurance company, educational institution,
or any
other
firm, person, or corporation be void or voidable by reason of any service as director
of the
authority.
If any director, officer, or employee of the authority shall be interested
either directly or
indirectly,
or shall be a director, officer, or employee of or have an ownership interest
(other than
as the
owner of less than one percent (1%) of the shares of a publicly held
corporation) in any
firm or
corporation interested directly or indirectly in any contract with the
authority, that interest
shall be
disclosed to the authority and set forth in the minutes of the authority, and
the director,
officer,
or employee having that interest in it shall not participate on behalf of the
authority in the
authorization
of this contract. Interested directors may be counted in determining the
presence of
a quorum
at a meeting of the board of directors of the authority which authorizes the
contract or
transaction.
(g) Any action taken by the authority under the provisions of this chapter may
be
authorized
by vote at any regular or special meeting, and each vote shall take effect immediately.
(h) The board of directors may designate from among its members an executive
committee
and one or more other committees each of which, to the extent authorized by the
board
of
directors, shall have and may exercise all the authority of the board of
directors, but no
committee
shall have the authority of the board of directors in reference to the
disposition of all
or
substantially all the property and assets of the authority, or amending the
bylaws of the
authority.
(i) Any action required by this chapter to be taken at a meeting of the board
of directors,
or any
action which may be taken at a meeting of the board of directors, or committee
of it, may
be taken
without a meeting if a consent in writing, setting forth the action to be
taken, shall be
signed
before or after that action by all of the directors, or all of the members of
the committee.
(j) The board shall conduct a training course for newly appointed and qualified
members
and new
designees of ex-officio members within six (6) months of their qualification or
designation.
The course shall be developed by the chair of the board, approved by the board,
and
conducted
by the chair of the board. The board may approve the use of any board or staff
members
or other individuals to assist with training. The training course shall include
instruction
in the
subject area of this chapter and chapters 46 of title 42, 14 of title 36, and 2
of title 38; and
the board's
rules and regulations. The director of the department of administration shall,
within
ninety
(90) days of the effective date of this act, disseminate training materials
relating to the
provisions
of chapters 46 of title 42, 14 of title 36, and 2 of title 38.
SECTION 4. Severability. If any provision of this act or the application
thereof to any
person
or circumstances is held invalid, such invalidity shall not affect other
provisions or
applications
of the act, which can be given effect without the invalid provision or
application, and
to this
end the provisions of this act are declared to be severable.
SECTION 5. This act shall take effect upon passage.
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LC00403/SUB A
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