East SBV Times

Senator Rosilicie Ochoa Bogh (R-Yucaipa) has announced that Senate Bill 985, which grants nonprofit financial counseling agencies a one-time adjustment to their fee schedule so they may continue to provide debt management and settlement services to Californians, has been signed by the Governor.

"I am grateful that my legislative colleagues and the Governor recognized the important role financial proficiency plays in the lives of all Californians," said Senator Ochoa Bogh.

"Restructuring credit card debt and learning how to manage debt are important parts of financial literacy. SB 985 will enable nonprofit agencies to continue expanding their services, helping more Californians, especially those in underserved communities, achieve financial freedom."

According to data from TransUnion and the Federal Reserve, Californians hold over $152.7 billion in credit card debt, creating a serious problem affecting many residents. When consumers face insurmountable financial debt, they have few supportive options. Modifying the current fee schedule will not affect clients currently enrolled in debt management or settlement plans. The adjusted cap merely gives nonprofit agencies the ability to use a higher sliding scale, which gives all consumers access to valuable credit counseling services.

While fee adjustments have occurred in other states, California’s nonprofit financial counseling agency fees have only been adjusted once since originally established in 1983.

“With the passage of SB 985, the nonprofit members of the FCAA and NFCC will be able to continue the invaluable work we do helping Californians who are struggling with their family's budget, wondering which steps to take to resolve their difficulties without destroying their credit,” said Martin Lynch, President of the Financial Counseling Association of America. “Many California families are struggling, but many of the nonprofit agencies that want to help have been struggling too. SB 985 will allow us to continue providing services to the families and individuals whose debts are overwhelming their budget. Our free counseling helps people understand their options and find safe solutions to their financial problems.”