SENATE BILL REPORT

                                   EHB 1185

            AS REPORTED BY COMMITTEE ON WAYS & MEANS, MARCH 2, 1992

Brief Description:  Requiring certain federal liens to be filed with the department of licensing.

SPONSORS:Representatives Appelwick, Paris and Wineberry.

HOUSE COMMITTEE ON JUDICIARY

SENATE COMMITTEE ON LAW & JUSTICE

Majority Report:  Do pass as amended. 

      Signed by Senators Nelson, Chairman; Thorsness, Vice Chairman; Erwin, Hayner, M. Kreidler, Madsen, Newhouse, Rasmussen, and A. Smith.

Staff:  Dick Armstrong (786‑7460)

Hearing Dates:March 27, 1991; February 28, 1992

SENATE COMMITTEE ON WAYS & MEANS

Majority Report:  Do pass. 

      Signed by Senators McDonald, Chairman; Craswell, Chairman; Bailey, Bauer, Bluechel, Cantu, Gaspard, Hayner, M. Kreidler, Metcalf, Murray, Newhouse, Niemi, Rinehart, Saling, L. Smith, Talmadge, Williams, and Wojahn.

Staff:  Martin Chaw (786-7715)

Hearing Dates: March 2, 1992

BACKGROUND:

Generally, security interests on personal property are centrally filed with the Department of Licensing rather than being recorded with county auditors as is the case with real property.  However, a different rule applies to some federal liens on personal property.  Some federal liens on personal property must be recorded with the county auditor.

In 1988, the Legislature enacted the Uniform Federal Lien Registration Act.  Notices affecting federal tax liens or other federal liens are covered by this act.  Notices of federal liens upon real property must be recorded in the county where the property is located.

Notices of federal liens upon personal property, however, must be recorded as follows:  (1) liens against corporations or partnerships whose principle executive offices are in the state must be filed with the Department of Licensing; (2) in all other cases, liens must be filed in the county of residence of the person against whom the lien applies.

The Department of Licensing is authorized to charge fees to cover the costs of filings.

In 1989, the Legislature amended the Uniform Federal Lien Registration Act to provide that all federal liens on personal property are to be filed with the Department of Licensing.  However, the Governor vetoed this legislation (HB 1096 from 1989).  Even though the bill provided for fees to cover the costs of filings, the Governor's veto message indicated that the fiscal impact on the department was unacceptable.

SUMMARY:

The same legislation relating to filing federal liens that was vetoed in 1989 is enacted.

All notices of federal liens on personal property are to be filed with the Department of Licensing.  The department is to enter federal lien filings in the Uniform Commercial Code filing system.  Fees may be charged to cover the costs of filings.

Appropriation:  none

Revenue:  none

Fiscal Note:  available

Effective Date:  July 1, 1992

SUMMARY OF PROPOSED SENATE AMENDMENT:

Technical amendments are made.

TESTIMONY FOR:  None

TESTIMONY AGAINST:  None

TESTIFIED:  No one