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DFPI proposes fee increases and trailer bill language to address fund shortfall; lawmakers and industry urge phased review
Summary
The Department of Financial Protection and Innovation presented trailer bill language and fee adjustments intended to address structural shortfalls in the Financial Protection Fund. DFPI and an outside consultant said program fees have not kept pace with costs; the LAO recommended a three-year limited-term increase plus reporting; escrow and
The Department of Financial Protection and Innovation (DFPI) asked the Assembly Budget Subcommittee No. 5 to approve trailer bill language and fee adjustments across several licensing and regulatory programs to address a structural deficit in the Financial Protection Fund.
DFPI officials told the committee an independent financial review by Crowe LLP (finalized November 2024) showed that longstanding fee levels across many programs have not kept pace with rising operating costs and that the fund risks insolvency without adjustments. DFPI requested statutory authority to adjust certain assessments and to set an hourly examination rate tied to estimated average costs; the department said the statutory changes would take effect July 1, 2025.
"Some fees date back to 1959 while the most recent fee adjustments for some programs were made in 2013," Deputy Commissioner Sophia Smith said, summarizing…
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