Yesterday morning, the Little Hoover Commission voted to approve the Governor's Reorganization Plan, subject to the members appointed by the Speaker of the Assembly (Mark Vargas) and the Senate Rules Committee (Jonathan Shapiro) reaching agreement on unspecified language in the Commission's report. The Plan will take effect unless either house of the legislature adopts by a majority vote a resolution disapproving the plan. Cal. Gov. Code Section 12080.5.
The Senate Governmental Organization and Governance and Finance Committees are scheduled to hold a hearing today on the plan.
As a former Commissioner of Corporations, Interim Savings & Loan Commissioner and General Counsel to the Business, Transportation & Housing Agency, I strongly oppose the merger of the Departments of Corporations and Financial Institutions. The Plan is likely to prove disastrous for small business lending and community banking. It will weaken the administration and enforcement of California's securities, franchise investment and real estate laws.
I am not alone in my concerns, three former heads and a former Chief Deputy and Acting Superintendent of what is now called the Department of Financial Institutions wrote to the Little Hoover Commission in April to express their "serious concerns" with respect to the reorganization of the Department of Financial Institutions.
For more on the Governor's Reorganization Plan, see the following posts:
