LEGISLATIVE SERVICES AGENCY
OFFICE OF FISCAL AND MANAGEMENT ANALYSIS
FISCAL IMPACT STATEMENT
LS 6442 NOTE PREPARED: Dec 5, 2024
BILL NUMBER: SB 122 BILL AMENDED:
SUBJECT: Nonprofit Loan Center Loans for State Employees.
FIRST AUTHOR: Sen. Deery BILL STATUS: As Introduced
FIRST SPONSOR:
FUNDS AFFECTED:XGENERAL IMPACT: State & Local
XDEDICATED
FEDERAL
Summary of Legislation: This bill provides that not later than: (1) September 1, 2025, in the case of a state
agency other than a state educational institution or a school corporation; (2) September 1, 2026, in the case
of a state agency that is a state educational institution; or (3) September 1, 2027, in the case of a state agency
that is a school corporation; a state agency shall partner with each nonprofit loan center (NLC) operating in
Indiana to become a participating employer in the NLC's nonprofit loan center program (NLC program) by
offering voluntary payroll deductions for eligible full-time employees to make payments toward the balance
of a nonprofit loan center loan (NLC loan) made by a nonprofit loan center lender (NLC lender).
The bill provides that after becoming a participating employer in an NLC program, a state agency shall allow
an eligible employee to: (1) voluntarily request and establish payroll deductions for an NLC loan at any time;
and (2) revoke the employee's authorization for payroll deductions for an NLC loan at any time; including
any time that falls outside a designated open enrollment period for benefits.
It defines an "NLC loan" as a loan that meets certain requirements with respect to the principal amount, loan
term, finance charge, authorized fees, method of repayment, and other loan terms. It authorizes the State
Comptroller to authorize the electronic transfer of funds from the state treasury to a designated NLC lender
in payment of an NLC loan on behalf of an eligible employee who has voluntarily given the State
Comptroller written authorization to make the transfer.
The bill specifies that: (1) a loan made under the bill's provisions; or (2) a person that makes a loan under
the bill's provisions; is subject to the requirements of the Uniform Consumer Credit Code chapter governing
consumer loans. It provides that a depository institution may make a loan under the same terms and
conditions that apply with respect to a nonprofit loan center loan to an employee of: (1) a state agency; or
(2) any other employer; as long as the loan is made in compliance with any applicable law. The bill also
allows a wage assignment to be made for the purpose of making payment to a depository institution in
repayment of a loan that is made to the employee by the depository institution under the same terms and
conditions that apply with respect to an NLC loan. It also authorizes the electronic transfer of funds from the
State Treasury on behalf of an employee of a state agency in payment of a loan made by a depository
institution to the employee under the same terms and conditions that apply to an NLC loan.
SB 122 1 Effective Date: July 1, 2025.
Explanation of State Expenditures: This bill will increase the workload of all state agencies to partner with
each NLC operating in the state for the purposes of offering NLC loans to (1) state employees before
September 1, 2025, and (2) state education institution employees before September 1, 2026. Workload
increases would continue after these dates, to set up payroll deductions for repayment of NLC loans as the
decision to apply for a NLC loan is not limited to annual open enrollment or a qualifying life event. Increases
in workload for state agencies and state education institutions are expected to be accomplished within
existing resource and funding levels.
Additionally, the bill would impact the workload of the State Comptroller to process payroll deduction
payments to NLC lenders if a state employee elects to receive a NLC loan. Increases in workload are within
the routine administrative function of the agency and are expected to be accomplished within existing
resource and funding levels.
Explanation of State Revenues:
Explanation of Local Expenditures: This bill will increase the workload of school corporations to partner
with each NLC operating in the state for the purposes of offering NLC loans to school corporation employees
before September 1, 2027. Workload increases would continue after September 1, 2027, to set up payroll
deductions for repayment of NLC loans as the decision to apply for a NLC loan is not limited to annual open
enrollment or a qualifying life event. Increases in workload are expected to be accomplished within existing
resource and funding levels.
Explanation of Local Revenues:
State Agencies Affected: All.
Local Agencies Affected: School corporations.
Information Sources: https://www.prosperityindiana.org/CLC
Fiscal Analyst: Bill Brumbach, 317-232-9559.
SB 122 2