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Senate | May 2, 2013 | Chamber | Sessopm

Full MP3 Audio File

[gavel] The President Pro Tempore: The Senate will come to order. The sergeant at arms will close the doors; the Members will go to their seats. Members and guests of the gallery will please silence all electronic devices. Leading the Senate in prayer is the Reverend Peter Milner, our Senate Chaplain. All Members and guests of the gallery will please stand. The Chaplain: Gracious and loving God, we do come before You and we thank You for a great state. We live in a great state. And on this National Day of Prayer, we are moved to see not only that reality here, but we remember that You are our mighty fortress, that as a nation and as individuals, we have called upon Your name, and You have placed a roof over our heads. We've been attacked, time and time again, but even inside of our hearts, we all know that it is like a wonderful thing to have a place for us to be safe, where we can be still and have confidence and other gentle reminders of protection and imposed upon us here gathered not only Your Blood but Your Divine Providence. Cover us under Your Word. Allay our cares, our thirst, and our desires. But You're as old as the trees from centuries down. Wind along the roads of North Carolina to the fountain of Your Grace. May the prayers of our grandmothers and grandfathers down to the tenth generation be lifted up to You, Lord Jesus. May they be lifted on high, and may the thoughts of our minds and meditations of our hearts be cleansed with hyssup. We commit ourselves again on this day, as did George Washington commit himself and our country to pray in 1775, to fast, to cease from recreation. Lord we do this to honor You, Lord we thank You for our religious freedom, and Lord we thank You for bringing us together here today in this Senate. In the Name of Jesus we pray. Amen. The President Pro Tempore: Senator Berger's recognized for a motion. Sen. Berger: Thank you, Mr. President. The Journal of Wednesday, May the first, 2013, has been examined and has been found to be correct. I move that we dispense with the reading of the Journal and that it stand approved as written. The President Pro Tempore: Without objection the Journal for May first stands approved as written. Leaves of absence are granted today for Senators Apodaca and Jenkins. Senators will come to order. We do have our Nurse of the Day with us today. Our Nurse of the Day is Earnest Grant of Chapel Hill, North Carolina. Ernest, if you'll just stand and be recognized, thank you for your service to the Senate. [applause] Ratification of the bills; the Clerk will read. Clerk: Enrollment of bills. The Enrolling Clerk presented the following bills as duly ratified for presentation to the Governor: Senate Bill 98, an Act to expand the Newborn Screening Program established by the Department of Health and Human Services, to include newborn screening programs for congenital heart disease, utilize pulse altimetry as recommended by the North Carolina Child Fatality Task Force. Senate Bill 456, an Act to require the Department of Health and Human Services to designate qualified hospitals as primary stroke centers, as recommended by the Justice Warren Heart Disease and Stroke Prevention Task Force. House Bill 488, an Act to promote the development of regional water and sewer services by transferring ownership and operation of certain public water and sewer systems to a Metropolitan Water and Sewer District. And the following bills are duly ratified and enrolled and presented to the Office of the Secretary of State: House Bill 506, an Act authorizing the Town of Weddington to enter into long-term agreements with volunteer fire departments to provide fire protections services for the citizens of the town. House Bill 555, an Act to allow McDowell [?] County to use the design and build method of construction. The President Pro Tempore: Reports of standing committees. Senator Pate, for what purpose do you rise? Sen. Pate: To send forth a committee report on three bills, Mr. President. The President Pro Tempore: Senator, you can send forth your report, and the Clerk will read. Clerk: Senator Pate of the Health Care Committee submits for passage Senate Bill 488, unfair admitted nursing home fees, unfavorably reports the bill in favor of the substitute bill.

Senate Bill 530, prohibit e cigarette sales to minors. Unfavored as to bill but favored as to Committee Substitute Bill. Senate Bill 553, unfavored as to bill but favored as to Committee Substitute bill. Title. An act to establish grievance and appeal procedures to Medicaid enrollees of local management entities that have been approved by the proper health and human service to operate in a managed care organization under the 1915B and C Medicaid waiver. [SPEAKER CHANGES] Senate Bill 488 Finance, Senate Bill 530 J1, Senate Bill 553 J2. [SPEAKER CHANGES] Mr. President. [SPEAKER CHANGES] Senator Brunstetter for what purpose do you rise? [SPEAKER CHANGES] Two motions related to today's calendar, please. [SPEAKER CHANGES] Senator Brunstetter has the floor to make his motions. [SPEAKER CHANGES] Mr. President, Senate Bill 337, NC public charter school board is on today's calendar. I move it be removed from today's calendar and recalendared for Tuesday May 7, 2013. [SPEAKER CHANGES] Without objection, so ordered. [SPEAKER CHANGES] Senate Bill 372 Omnibus County legislation is also on today's calendar, I ask it be removed from today's calendar and recalendared for Tuesday May 7 2013. [SPEAKER CHANGES] Without objection, so ordered. [SPEAKER CHANGES] Senators let's come to order as we're moving into the calendar. We'll start with public bill second reading roll call. Senate Bill 58, the clerk will read. [SPEAKER CHANGES] Senate Bill 58 increase funding for dredging. [SPEAKER CHANGES] Senator Brown is recognized to explain the bill. [SPEAKER CHANGES] Thank you Mr. President. I don't think I need to talk a whole lot more on this bill, I think it's been discussed and talked about and debated for a while but I think I do need to talk about why the bill is on, was introduced and what we're having to deal with. For many years the federal government took care of dredging on the coast of North Carolina and really, I guess, most of the east coast, but in the past few years those dollars have pretty much gone away. So, there's really no money left now for dredging the shallow draft inlets on the coast of North Carolina. And in the summer I think most of you probably go to the coast sometime or other, and I can assure you on the 4th of July you can probably walk across the inner coastal waterway on boats if you want to because that's how ?? will be in the water on the 4th of July. Probably when all these votes come to the coast and a lot of the maybe not living, people that don't live on the coast, one of the most dangerous places in the world to be is in an inlet that's too shallow to be going in and out of and you end up on the bottom. There's probably more drowning in Ellis than any other place on the coast because of that issue. So it is definitely an issue for the coast. Plus on the coast of North Carolina there's quite a few fishing tournaments, some of the best fishing tournaments in the country happen in North Carolina and they all depend on those boats being able to get in and out of those inlets. As we work through this bill, my first version usually did the fee increases on boats, and I listened to the concerns. So I went back and reworked this bill and been working on it I think to a point that now we're talking about registration fees that really haven't been touched in a long time and the existing fees on boats now are $15 per year to register a boat. And that's been in place for quite a while. I think Senator Bingham had a bill yesterday that raised the fees on getting a permit for a gun yesterday. So we look at raising these fees quite often. The ?? bill does is if you have a 25 foot boat or less it raises the registration fees on boats from $15 to $25. I'd say a pretty modest increase, especially the fee hasn't been increased for a long time. If you have a 26 footer or above, we're going to raise that fee from $15 to $50 dollars, and most, pretty much any boat that's a 26 foot or above is going to be on the coast because that's your bigger boats. I don't think you'll see many of those in any lakes across the state. It also raises the title fee $10 as well to capture some money, and the rest of the money is coming from the highway fund and there was an article in the paper yesterday that I think

[0:00:00.0] …Quote this right and a lot of people feel their both steps at the pump in the state of North Carolina, when they feel they cover up they have the both behind it and they will feel both as well as their cars at the same time and this is doing is recapturing a small percentage of those dollars that are in the highway fund one sixth of 1% and that generates a little over two million dollars. So, what we have generated overall is a little over six million dollars but I think the most important piece of this when…And I think the most difficult piece will be the people live on the coast is a bit poorly these dollars down is gotta be a dollar-for-dollar mash over communities on the coast. So, a coastal community that lives next to an inlet they are gonna have to match those dollars dollar-for-dollar to pull them down to be used for dragging on the coast. So, the coast communities have a whole lot of this and the game to pull these dollars down. There is an article I was reading earlier today it talk about the fairies__[01:02] in North Carolina, one of the fairies is gotten so shallow in that very that two fairies can’t pass each other any longer besides shallows gotten in some of those areas and there is a serious, serious issue on the coast, what it means the state dollars I think economically for the coast and the state as a whole if these are inlet shallow you pull the buoys they go away, it means millions of dollars to the state of North Carolina and tourism dollars that come to the state. Again, I think I have voted on this will all session I think it’s a pretty good compromise where we are at, one of the questions I think Senator Nesbitt asked me about drenching in lakes in the state, state dollars are used now to do that so we use state dollars to drench lakes when that’s needed. So, I think we have touched every area I know this bill it is not a coastal issue it is a state issue, people from all over the state come to the coast pulling boats. So, I’m asking for your support on this bill and import bill to the coast and into the state. And I try to answer any questions if there are any. [SPEAKER CHANGES] Is there any further discussion or debate? Hearing none, the question for the…Senator Tucker would you like to speak to the bill? [SPEAKER CHANGES] No Sir, I would like to ask in reference to the bill ask Senator Walters a question. [SPEAKER CHANGES] Senator Walters do you yell? [SPEAKER CHANGES] Yes, I do. [SPEAKER CHANGES] Senator Walters now as we have heard in committee with a raise in fees and now the reduction in fees for boats, will you be register in your boats in North Carolina now rather than South Carolina? [SPEAKER CHANGES] Senator Tucker I think Senator Brown explained the bill very well and I will support the bill at this time, thank you. [Laughter] [SPEAKER CHANGES] Is there any further discussion or debate? Hearing none, the question for the Senate is the passage of Committee Substitute #2 to Senate Bill 58 on its second reading, all in favor will vote aye, all oppose will vote no, five seconds will be allowed for the voting and the clerk will record the vote. Gunn aye, 35 having voted in the affirmative and 13 in the negative, the committee substitute #2 to Senate Bill 58 passes its second reading and it will remain on the calendar. Senator further down in your calendar Senate Bill 476 is local bill, we are gonna move that up for the next reading. So, the clerk will read Senate Bill 476. [SPEAKER CHANGES] Senate Bill 476: NC Captive Insurance Act. [SPEAKER CHANGES] Senator Meredith is recognized to explain the bill. [SPEAKER CHANGES] Thank you Mr. President and members of the Senate, this bill Captive Insurance Companies or insurance companies that are formed to insure the risk apparent and affiliates and control by unaffiliated companies sometime they are self-insurance companies. They are used as risk management tools to meet or assistant meeting the needs of owners or members, they are widely used in both United States and abroad more than half of the states have captive laws. Some of the benefits of captive are include reduced insurance cost, stabilized cost, increased coverage ability, direct access to reinsurance markets and the ability to customize an insurance program. There are many companies currently that have captive insurance are practicing captive insurance right now in North Carolina. They are not allowed to have… [0:04:59.9] [End of file…]

Speaker1: I have heard that xx insurers have to leave North Carolina and go to another state that approves capital?? insurance companies and form there and they have an annual meeting . Speaker changes: The reason about this bill is not only from an insurance stand point in giing people options but also from an economic development stand point. I’d like to use South Carolina as an example. In the last ten years after following capital ??insurance companies in South Carolina over a billion dollars of economic benefit to the state of South Carolina since its inception. So I would encourage all to support this bill, the insurance commissioner Harley supports it, they are very excited about this and I talked to numerous people in the industry and they hope that we will move this bill forward. I’ll try to answer some questions and I would appreciate your support on this bill. Thank you. Speaker changes: Any discussion or debate; hearing none, it is passed to the senators to committee substitute number two to senate bill 476 on its second reading. Favorable aye, opposable no; five seconds we will have for the voting, clerk will record the vote. Walter?? aye, forty eight having voted in the affirmative and zero in the negative committee substitute number 2 , senate bill 476 passes its second reading , and it will remain on the counter. We are on the public bill reading ,senate bill 320 for xx reading. Speaker changes: Senate bill 320, Improved aid for children who are deaf. Speaker changes: Senator Randle is recognized to explain the bill. Speaker changes: Thank you Mr. President, members of the senate, this bill has been in the process of being developed for two sessions now and I appreciate the work of Senator xx and senator Bryan in bringing this forward, really what this bill is about is language is an essential foundation for literacy attainment and this bill will ensure that children who are deaf or hard of hearing achieve literacy by the third grade. The specific.. the bill is pretty simple, I’ll[ xxx??] the bill analysis earlier to every member Xx Generally it is going to create tailored IP program for deaf children or children who are hard of hearing and I ask for your support of the bill with me and ask me any questions. Speaker changes: Any discussion and debate; hearing none the question for the senate bill passes to the committee substitute senate bill 320 on a second reading. All in favor vote aye, opposed vote no, five seconds we will have for the voting; clerk will record the vote.[pause] Brown, Tine, aye, Walters, aye, forty eight having voted in the affirmative and zero in the negative, committee substitute Senate bill 320 passes the second reading without objection to be read a third time. Speaker changes: xxxxxx Speaker changes: Any discussion or debate.[ pause] Hearing none, the question passes to committee substitute senate bill 320 on third reading ; all in favor say aye, opposed no. The ayes have sent committee substitute senate bill 320 passes its third reading, will be sent to the House. Senate bill 486 ready for reading. Speaker changes: Senate bill 486, subject is education and awareness. Speaker changes: Senator Todd is recognized to explain the bill. Speaker changes: Mr. President, members thank you. This bill is nothing more than a reminder, right now we have an increased incidents of whooping cough occurring and it will enable the hospitals to remind newborn mothers, or mothers who have newborns that T-DAP vaccination is available with or address the matter. Thank you. Speaker changes: Is there any further discussion or debate? Hearing none the senate has passed the senate bill 486 on its second reading; those in favor of it say aye, those who oppose the vote, no. Five seconds we will have for the voting, the clerk will record the vote. McKissick aye, Hereford, Hart, aye, aye,. Forty eight having voted in the affirmative and zero in the negative senate bill 486 passes a second reading without objection be read a third time. Speaker changes: XXX ACTS Speaker changes: Any further discussion debate? Hearing none the question for the senate passes senate bill 486 on third reading. All in favor say aye, opposed no. The ayes have sent senate bill 486 passes its third reading and will be sent to the House. Senate bill 489, xx for reading. Speaker changes: 489, Consumer Finance act amendment.

him as recognizing Plainville, thank you Mister President, or for not having received my computers locked up a motorbike. it does intervene and help me fix it. I will as members of the thankful. let me bring this bill for Senegal for a non- protected consumers continued access to traditional instalment credit are North Carolina consumer finance act, would you give a brief description of what design the design cash maximum loan amount of fifteen thousand dollars a pop in his right calf from thirty six to thirty, and making slight adjustments within the three divine minion brackets makes monthly repayment. the robots doing the minimum long time to Lebanon 's print right now. six hours a nominate through the charge continues to maintain worked on strong consumer protections, especially for military members and it significantly reduces the APR class on smaller dollar lines. members of Montréal residents deserve expand access to reasonable, safe and regulated instalment credit to finance acts of and in the provision and there had been in here to mistake seven decades, and they deserve to have these all available devices regulated and examined companies, Commissioner of Banks is a proven top regulator when growing us have not been adjusted for thirty years it was believed that after thirty years of inflation. some reasonable adjustments are necessary. all customers need to understand their need to make the payments on time and contract licensing should have the ability to collect a nominal nominal fifteen dollars late fee, just like banks, credit card companies and other lenders, customers do not take late charges. all are only overpaid men if made within that. the maximum amounts available should be increased somewhat more, consumers should have access to credit military protections, nothing is real important in response to the concerns of various military bases instrument is several landmark protections that will provide a new level of protection for our young soldiers and their families. as a result of these provisions, Nevada commanders Council and a consensus vote is taken another position on this particular vehicle. but they did tell us that those provisions must remain and we have all met here to their request, Commissioner of Banks is taken another position on Senate Bill four eighty nine, Commissioner Banks did request an industry has included language providing additional protections for non- file coverage if it is obtained. I would find out that the neurotrauma commissioner banks and the Justice Department commented in the consumer finance study and February two thousand eleven. if you are the remarks no compelling evidence was submitted by consumer advocates are describing a review of the North Carolina commission of banks and just about also support the view that refinancing is an abuse of consumers are in need intermediation work on a commission of nice data collection does not distinguish in-depth informational renewable that came up in committee. they do not report according to size Tom or amount advanced industry would be supportive of more comprehensive data collection, licensees. this is, we believe this bill is reasonable and needed and well just thought of this time, given the fact that it has been thirty years without any adjustment. this bill provides several avenues to reduce renewable. one elimination elimination all of chapter fifty three, one seventy three on the small lung chapter includes a performance which makes it easier for customer and company instead of renewing the loan. it raises the minimum time from six to twelve months to create smaller payments that would lessen the chances for customers to become overwhelmed. Susan, the Chronicles of deserve this choice. this availability in this access to sound say credit appreciate your support and be glad to answer any questions and discussion. the bank president centre court for mercy on us. so for the moment

Actually, I’d like to send forth a series of four amendments, if that’s okay. [SPEAKER CHANGES] We’ll send them forth one at a time here. And we’ll vote on them one at a time as well, Senator. Is the next amendment on the dashboard? [SPEAKER CHANGES] Yes sir, it should appear on the dashboard. [SPEAKER CHANGES] The clerk will read. [SPEAKER CHANGES] Senator Clark moves to amend the bill. [SPEAKER CHANGES] Senator Clark is recognized to explain the amendment. [SPEAKER CHANGES] The purpose of this particular amendment here is to exempt the spouse from being contacted in the event that the member who has signed for the loan happens to end up in the theater of war. [SPEAKER CHANGES] Is there any discussion or debate? [SPEAKER CHANGES] Mr. President. [SPEAKER CHANGES] Senator Gunn, for what purpose do you rise? [SPEAKER CHANGES] To find my notes. I appreciate you, Senator Clark, bringing this amendment. I believe that this is an additional protection for the consumers and particular for our young military family and I would encourage you to support the amendment. [SPEAKER CHANGES] The bill’s sponsor encourages you to support the amendment. Senator Newton, for what purpose do you rise? [SPEAKER CHANGES] To see if Senator would yield for a questions? [SPEAKER CHANGES] Senator Clark, do you yield? [SPEAKER CHANGES] I do. [SPEAKER CHANGES] Senator Clark, if this amendment passes with the approval of this body, do you intend to support the bill? [SPEAKER CHANGES] It depends on the status of the other amendments that I will also send forth. [SPEAKER CHANGES] Follow up. [SPEAKER CHANGES] Do you yield, Senator Clark? [SPEAKER CHANGES] I do. [SPEAKER CHANGES] Senator Clark, if your other amendments, which I think I know what they are, but if they don’t pass, but this one does, will you support the bill? [SPEAKER CHANGES] If the amendment regarding pulling this or not allowing this to go to a military member does not pass, I will not support the bill. [SPEAKER CHANGES] To speak to the amendment. [SPEAKER CHANGES] Senator Newton has the floor to speak to the amendment. [SPEAKER CHANGES] I appreciate Senator Clark’s honesty on the series of amendments that he intends to set forth. I think this is a sound amendment and I’d like to see it included in the bill, but I really would like to see Senator Clark’s support of the entire bill. [SPEAKER CHANGES] Any further discussion or debate? Hearing none, the question before the Senate is the passage of amendment one. All in favor vote aye, all opposed vote no. Five seconds will be allowed for the voting. The clerk will record the vote. Tucker, aye. Berger. 47 having voted in the affirmative and 0 in the negative, amendment one is adopted. Senator Clark, you sent forth another amendment? [SPEAKER CHANGES] Yes sir. [SPEAKER CHANGES] And that amendment is on the dashboard. The clerk will read. [SPEAKER CHANGES] Senator Clark moves to amend the bill. [SPEAKER CHANGES] Senator Clark is recognized to explain his amendment. [SPEAKER CHANGES] This particular amendment is actually required by federal statute, but we thought it would be appropriate to actually include it in the state statute as well. Just make sure there’s no...if a person is charged a late fee it’s not pyramiding on an individual because the particular company might say, ok, you were late in making your payment, therefore you didn’t pay your entire thing on time, therefore you’re going to get charged another late fee and it just continues to go on and on and on. This particular provision would preclude that from happening. [SPEAKER CHANGES] There any discussion or debate? Senator Gunn, for what purpose do you rise? [SPEAKER CHANGES] To debate the amendment. [SPEAKER CHANGES] Senator Gunn has the floor to debate the amendment. [SPEAKER CHANGES] Once again, I would like to thank the distinguished Senator for bringing this amendment forward. I think once again, that in an effort to try to work with everybody in this chamber, I am going to support this amendment and I would encourage you to do so. [SPEAKER CHANGES] The bill’s sponsor encourages your support. Is there any further discussion or debate? Hearing none, the question before the Senate is the passage of amendment two. All in favor vote aye, all opposed vote no. Five seconds will be allowed for the voting. The clerk will record the vote. Clark, aye. 48 having voted in the affirmative and 0 in the negative, amendment two is adopted. Senator Clark, you going to send forth another amendment? [SPEAKER CHANGES] Yes sir. [SPEAKER CHANGES] The clerk will read. [SPEAKER CHANGES] Senator Clark moves to amend the bill. [SPEAKER CHANGES] Senator Clark is recognized to explain his amendment. [SPEAKER CHANGES] Effectively what this amendment does is it removes the provision in the bill that says that we’re going to be allowed to provide this particular loan to military members. As written, the bill says we can provide it...

desire of $24.00-a-lifetime experience at all of the estate, nor was it has been made that I love for the same as supporting of estimating the so-is-is a recess times the one hand is often as a city that that timing of the half-staff and is similar in some comments from the death of a 70-fifth thing by the time or date and at $2.00 and say that, in view of this than the sum of the assembly and one of the of offered in a time in terms of-the one that has either been sent to the whole family of four selected the time has been confidence that what this is one of the event at the state of Nevada seven by Stephen Adam’s apple United States and require that make something for two times of this person would have seen with a set of images of us would have been set at the city's one that has been the update-that-day events that was best man who made the score with that of this is the time and said in the semis six members of the time the disaster that is that the assembly of-fact of us that the system has said that having done it at this and stacked them that's the case of a five-piece for the senate might as well as more than we understand that the senate finance ministry and isn't that the defendant from that statement as the debate, the businesses back to the project managers of the defensive ends and the Swanson, as well as many times and 80, the present a day that the force and enters the design is the status of a Disney is that the economy ??(SPEAKER CHANGES) senses and 7-11 AM Investment is a key aspect of the suspect in the habit of Maine’s china's MFN is Wendy either his head-18, who has been happening 10 highest level of play as many as a ??with the Data Systems will benefit commands into some of the seven-time-management, is that event of the fact that I haven't access is a fact of the senate, as those in contact with an impact is as the budget, isn't it, then I'll fire has been definitely have a sense of confidence from the anti-business event that part of the family's offense at him as those that asbestos-laden with the decision, assessment is that a high incidence and easily as the finances of S and, finance and lobbying the state division of these of a button that the tiled that that is the Data Systems to active duty and firearms women fighters taxes as well as needed to pay all the time that they cannot afford the A's and B's on these routes and that is a five-plus one and eight days of smart of childhood events have the events of data that make sense of men and women in the services of his time and effort to increase the rate for those duties of a five-cent fine is no data for your continued support incidents of child, the factors that has meant that the city said that one is a time and that is has been the spread of saint john's time the center of course ?????.................

[0:00:00.0] Senator ___ yelled for a question. [SPEAKER CHANGES] I yelled for a question. [SPEAKER CHANGES] Senator Clark you are Four Star Admiral is retired. [SPEAKER CHANGES] That’s correct. [SPEAKER CHANGES] And he represents a Navy, Marine Corps Relief Society. [SPEAKER CHANGES] In what capacity? [SPEAKER CHANGES] He has it up. [SPEAKER CHANGES] He hedge to that as a retired…What state is he in? [SPEAKER CHANGES] I don’t know what state he is in, Sir. [SPEAKER CHANGES] I do say it’s not North Carolina. [SPEAKER CHANGES] To speak on the amendment briefly. [SPEAKER CHANGES] Senator Tillman has the floor to speak on the amendment. [SPEAKER CHANGES] You have offered two good amendments and I think you have thrown in one that you don’t like so you can go against the bill Senator that’s good work if you wanna do it that way thank you. [SPEAKER CHANGES] Senator Gunn what purpose you has? [SPEAKER CHANGES] To speak to amendment please. [SPEAKER CHANGES] Senator Gunn has the floor to speak to the amendment. [SPEAKER CHANGES] I’m gonna ask the members here to not support this amendment. I do think there is a big difference in the letter that Senator Clark gave you and a letter that I have signed here by Thomas A. Gory Brigadier General US Marine Corps Chairman, North Carolina Commanders Council, North Carolina Commanders Council. They have taken no position they are tickled to death and I wanna go through on that but they have tickled to death that we have lived and worked ___[01:26] with these folks to put additional provisions for these hard serving members and their families, I would ask you to not support the amendment. [SPEAKER CHANGES] Those sponsors ask not to support the amendment, is there any further discussion or debate? Hearing none, the question before the Senate is the passage of Amendment 3, all in favor will vote aye, all oppose will vote no, five seconds will be allowed for the voting the clerk will record the vote. 14 having voted in the affirmative and 34 in the negative, amendment 3 fail. Senator Clark you have a fourth amendment, Senator Clark you send forward your amendment the clerk will read. [SPEAKER CHANGES] Senator Clark moves to amend the bill. [SPEAKER CHANGES] Senator Clark is recognized to explain his amendment. [SPEAKER CHANGES] As indicated previously I was I guess provide on these particular loans with the members of the military. [SPEAKER CHANGES] [Inaudible] [SPEAKER CHANGES] Sorry, as I indicated previously I was against providing these particular loans with the members of military but I’m equally concerned about providing this product to members that are not are at the military. Okay, I just believe them to just rise too high so what I’m recommending in this particular bill as that we invert them to just the way structured which bring up this bill. [SPEAKER CHANGES] I think there is gonna be an image displayed on your dashboard members for you to review. [SPEAKER CHANGES] If you look on your dashboard you will see a PowerPoint there saved as PDF. Okay, under the current board structure basically has 500 I mean $5,000 increment. What bill is saying is that for the first $5,000 we are gonna charge 24% interest. And the second $5,000 I mean the second $5,000 24% going further remainder 18% but what I’m saying is essentially invert that structure, on the first 5,000 we charge 18%, the second 5,000 we charge 24% and then on the final 5,000 we charge 30%. Now, what the industry is saying they can’t afford that but I don’t believe that’s necessarily true, I do believe that they can charge lower interest rates and still make money, next slide please. [SPEAKER CHANGES] Mr. President… [SPEAKER CHANGES] Senator Kinnaird what purpose you ask? [SPEAKER CHANGES] To speak to the amendment. [SPEAKER CHANGES] The Senator still explains the amendment… [SPEAKER CHANGES] I’m sorry. [SPEAKER CHANGES] Well, the next slide we just see here this is a comparison between what our bill here is doing and what is just taken place in floor, okay. So, if you look on the right hand side you see the floor bill they just passes on May 1st, okay. Now, actually what they will do is providing loans… [SPEAKER CHANGES] Excuse me…! Like the ___[04:34] so I would have to hold. [SPEAKER CHANGES] Okay, they are actually providing loans up to $25,000 but that will just kept to $15,000 for comparison purposes. So, you can see with floor what they are doing is the first 5,000 they are charging but actually 30% on the first 3,000 they are charging 24% on the next thousand well as on the other hand on the first 5,000 we are charging 30%... [0:04:59.9] [End of file…]

has any of them is working in this does it have made money does any of them is working in this does it have made money at it would be well-fed beef at it would be one of those affected and as a ?? site to a ?? site , and that economic money-high as one husband is available on a times the success of the same action of these of the heavy as it is because the a bands are more so as head of the of the hands of economic money-and once more that wasn't as a vital part of a Times' business as are the sign-up views of the date as it is because the hop and are more so as is happening Saturday event organized into the time that you, since the incident as a minute of this is a ceasefire and answers and¢, a mixture of environment and development space for that Saturday and is recognized as an island you, since the incident as a minute of the statistics, answers and¢, administrative leave the restaurant and Spanish for that that the event, downstairs where they're being the second fascination and Anthony said, sitting behind a mastermind behind us, as some of this event would actually have a difference because it would have those were getting larger ones and industries to 6:43 in the fall are concentrating his style agents on action supporters so-CS-half-cent levy a value of the same time, the 2-3 vice chair, his status as the as far as the 1970s, a significant, because of the standoff as many as 27, oftentimes, and then, once the setup is disappointed as a result of fire-control cost accounting info, 1. that this time as they needed to display a three-cent the inflation rate is a city on Thailand, 10 of his company can make money off into space at 18%, for purposes of this one , center for the time all-and-center section that this has his hands, insemination the presence of business-as-times-Seagull of 7412-stage in the senate has passed-and-as-you-and-a-?? sense that this is, as the interest rate of the first two years and has a 30% of the ?? doesn't have a happy that this is the-handed-a Addison street, Manhattan some facts of this amendment would they just happen to the considers China as interest rates even higher -education center, has just the CNN and time is important for statement to report, ¢-high 18-that is a sense of what has a stated it-sentence report, was $1000 and one that would sit-as well, it was the first part of multiple of the style of the scene of the mess of them until the sun was not affected the president being under the current one stressed that the issue as hostages in some of us has made him a chance at the fact that the status of the season was his mouth is , that about a year has made the ms has is in a spacious people who had tiled the mayonnaise and have a five-cents-a biased as his comments, and some idea about, the site is an out of Asia has more than half a chance even have the phenomena as the adding that the evidence that these-time so that not have as a business sense of that his successful ascent as impressive as a defense that has said that says that as they drive the CIA that happened that day, and the CDs and and that this is less than that this was a-second in the 10-day show live with that events and four- ??............

Representative: …you have this service to go to, to try to help these people, and, in most cases, who have happened to get a job now, have no transportation, or have credit card debt that is, in my opinion, is even worse than these because you never end up paying it off. What you find is that people can get these loans and in most cases, Senator Newton hit it right, in most cases these loans are $5000 or less. These are not big loans. So if you look at the total amount of interest paid on these loans, in the scheme of things, that interest is really a small amount, but what it does is, in my opinion, most importantly, it gives that individual an opportunity to build some credit. I know in committee we talked about this and I could not get statistics, because they were not out there, but I can tell you personally, for my business, if I can get someone one of these loans and they will pay it for a year, year in a half, and pay those payments on time, I normally can take that customer and put them in a conventional loan next time, and really help them get in a better financial situation. Now if you have got individuals that are not going to pay these loans either, then I cannot fix that problem, and I don’t think anyone in this building can fix that problem. I think these are good step loans for most people to rebuild their credit and put them into a better situation – to, in the future, be in a better position to buy a car, home, whatever it may be, but the chance to improve their credit situation to improve their style of life. Surely these interest rates were high – no one is going to ague with that, but, you have got someone who is willing to take a chance on these individuals to fix that problem. I would say in most cases most people will pay this debt and improve their credit situation in the future. I think this is a good deal. I think this amendment hurts what these businesses are trying to do. I cannot support this amendment. I think we are beating these people up, Most of them have gone out of business in the last few years, so it is not like this is a lucrative business where everybody is making a ton of money. They are taking a ton of risk, and I think you need to defeat this amendment. I think you have a good bill that helps put people in a better situation for the future. Speaker: Any further discussion or debate? Senator Bryant, I’m sorry, Robinson, for what purpose do you rise? Representative: [laughter] I will be Senator Bryant, I like her. I rise to speak to the amendment and I want to ask the amendment’s sponsor a question first. Speaker: Senator Clark do you yield? Representative: I will yield. Representative: Senator Clark, back to your chart, and maybe I am reading it wrong, but could you re-explain that because it does appear that up to $5000 that is at 30%, but is that currently what is in place? Are you offering the reverse of that? Could you explain that please? Representative: Could you bring up the chart please? Representative: I am looking at my dashboard. Speaker: It is on your dashboard Senator. Representative: Okay, you have S [xx] 89 m, that is as the current bill is written. That is not my recommendation. My recommendation is on the right hand side, in blue, the first $5000, and 18% interest rate would apply. As opposed to the bill, as currently written, a 30% interest rate would apply. All of that is essentially inverted the structure. On the left hand side, the bill is currently written. It goes 30, 24, 18. I am saying let’s reverse that, going 18, then on the next 5000, 24, then on the next 30,000, I mean the next 5000, 30%. I presented this to the industry officials who said they could not do it because they could not afford it. That is why I showed you the [xx], in which case it served what Florida is doing. They are charging a lower structure than what we have. So I am certain that we can do better than as currently stated in this 489. Representative: Thank you. Follow up, Mr. Chair? Speaker: Senator, do you yield for a follow up? Representative: Well actually, I will just speak on the amendment. Speaker: Senator Robinson has the floor to speak on the amendment. Representative: I want to support the amendment because, while I would generally support this bill because it is an alternative to high credit

cost rates and I think we do need to have an alternative. I too am concerned about high interest rates for people who are the working class poor who really don’t have, Senator Brown, anywhere to borrow money from have bad credit. But the issue I have is still it’s a high rate and secondly there is no counseling. Financial counseling is so very important where Senator Brown would offer that to his customers and then later offer conventional loan. In general there are not people out there who says a condition of this loan, after you pay this off or while you’re paying this off, you need to come in for consumer credit counseling so we can help you with financial literacy. To understand how this impacts your long term ability, to have good credit to buy a house to buy a car, etc. And so I think that this is a good alternative. I support the amendment. I am concerned still about the overall lack of consumer credit counseling. [SPEAKER CHANGES] Mr. President. [SPEAKER CHANGES] Senator Brown for the purpose of your rise. [SPEAKER CHANGES] Just to speak a second time real quick. [SPEAKER CHANGES] Senator Brown has the floor to speak to the amendment a second time. [SPEAKER CHANGES] I think you see on a $5,000 loan you’re talking about $489 in interest. That’s what we’re talking about. I’m gonna ask this question. Is there anybody in this room that will loan someone $5,000 that has a 450 beacon, with terrible credit, with a $489 return? I’m gonna ask that question. I don’t think anybody in this, anybody would do that. I think that is a small return for the risk that’s out there. You need to think about what these people are doing and they’ve got to make a profit out of that as well. That is a pretty reasonable, I think, loan to make. I think that’s the question you’ve got to ask. I wouldn’t make that loan personally. I wouldn’t loan my dollars out there. Think about it in that respect. [SPEAKER CHANGES] Any further discussion or debate? Senator Gunn for the purpose of your rise. [SPEAKER CHANGES] You’re having too much fun I’ve got to speak to the amendment police. Let me just reemphasize 30 years, how many people in this room own a business, been associated, have been 30 years without an increase. 30 years without an increase. Unless you’re in the real estate business which is non-profit. Years of inflation folks, years of inflation, normal business increases every single year these are reasonable rates that have been proposed. The North County Commissioner banks has stated in their report that 40 to 50 percent of these companies are operating at a loss. I’d ask you to defeat this amendment. [SPEAKER CHANGES] Senator Nesbitt for what purpose do you rise? [SPEAKER CHANGES] Thank you, Mr. President, to speak on the amendment. [SPEAKER CHANGES] You have the floor. [SPEAKER CHANGES] Thank you, Mr. President and members of the Senate, I rise for two purposes. One of them, a while ago there was, I think Senator Clark was accused of offering bad amendments so he could vote against the bill. I just want to say from my perspective and knowing him and having listen to him, he firmly believes that this is detrimental to the military and he’s defending the people that he knows. Just like I’d defend the folks in the mountains and y’all would defend the folks, the farmers and whoever else. And I really sincerely feel that, but I don’t think it’s proper to prescribe motives to people offering amendments. And as we have gone through this the question becomes how much is enough? You do have inflation, but we also had a depression. And we also, you can get a home loan for 2½% now. I think that’s what I saw on tv, 2 ½ or 3 or 3 ½ %. The FEDs loaning the big banks money for nothing, zero, unless that’s changes lately. And the cost of capital was gone way down. And there’s no question this industry had a tough go. A lot of them are in the second mortgage business and when the housing market collapsed so did their collateral and so did their loans, but that happened to everybody. Everything collapsed. And I feel for them

Representative: I think they are a good industry and I want them to stay here, but I think that it is legitimate to raise the point of how much is enough, and what the rate ought to be, and whether they would make it in today’s world without increasing these rates on the people, secondly, I want to add to the debate that there was some discussion on credit counseling when the credit unions came to visit us this year, I had a long conversation with them, and I asked them what kind of loans they were making this year: they are making every kind. I asked how they were doing it because everybody’s credit is ruined, just like Senator Brown said. A lot of people that did not have a hard time had their credit scores ruined because they cut credit lines and they did things like that, that bump your credit score up when you make your payments and everything else. They actually do a thing when somebody comes to them and has a bad credit score, they put them in a loan and require them….I am not sure about that… They offer them a course on how to rebuild your credit. They actually teach it at the credit union, and the people come like one day a week. The minute you get your credit score up, they move you to another loan with a better interest rate. That’s what we need to be doing for people with bad credit, not just sticking them in a loan with a high interest, leaving them, and letting them do the best they can. The first thing that will happen to them is they will not be able to make this payment, and like you said, nothing can fix it. So, we may want to think about that. We may want to think about requiring people, at a minimum, who make high interest rate loans, to offer – I am not sure credit counseling does it, some way for them to work themselves out of it. These people, if the risk is less, they ought to be able to offer a better rate. I assume that they do because these are maximum rates. I assume they do. So we may want to look at that as we move through this bill to see if we can come up with some way to accommodate this need as well as the difficulty that people find themselves in. Speaker: Further discussion or debate? Hearing none, the question before the senate is the passage of amendment 4 to senate bill 489. All in favor will vote aye, all opposed will vote no. Five seconds will be allowed for the voting. 9 having voted in the affirmative, 39 in the negative. Amendment 4 fails and senate bill 489 is back before us on a second reading. Is there further discussion or debate? Senator McKisick, for what purpose do you rise? Representative: To speak on the bill. Speaker: You have the floor. Representative: First I would like to ask the bill’s sponsor a question. Senator Gunn, do you yield? Speaker: Senator Gunn, do you yield? Representative: I yield. Speaker: He yields. Representative: Senator Gunn, the statistics I have seen, relating to these types of loans, indicate that 2/3 of the people obtaining these loans simply had been turned over – they keep flipping them and they never get out of this cycle of debt. Is there any language in your bill that would limit that problem so we know that people can somehow eliminate that cycle of debt people seem to be trapped in, because I know that 2/3 of these people are going to end up in this cycle indefinitely, and one day, may end up in bankruptcy? Representative: Senator McKisick, I think you heard those same statistics in meeting and remember that the response is that the NC commissioner of banks does not have data that breaks down the reasoning of why it is 60%, but let me tell you this, these are fully amortized loans – fully amortized. People are paying these down from the day they get them. If they want to refinance, and I do not know about you folks, but knowing my business, we refinance all the time. As a matter of fact, there are lines of credit that I work with but the point is this, they do not allow you to take out, the company cannot, take out another loan without

The values of an incentive house and-measurement of that, as ½ as van ness and handicrafts, a nation of imminent, not the time of the issue is working as some of those conditions that the long distance on the pages in a pen-based economy-city star times legislation does the interest rates and a senior won one of the things about the fact that you have individuals in the day and 30% actors $5000 in-time that second-to-$10,000 and the data into the aisle a TV set-top $35,000 of the 10,015 counts these are raising these formerly that time of the service and on the sidelines and investments we know that leaders ought to be able to go to CNN and either studies in front of the handsome, less time for action on ESPN's Data in the right and you find your demands that low interest rates this country the end of the people have to take their capital cities fact that I'm quite sophisticated money they are all tied to the ladies individualism that, dates and times enters the other two videos on your savings account for investment that has already contacted more about 237 MVP of the division race of the two-time buyers in 15 that hasn't been the dissenting were hacked out into the spotlight between the cost of capital his position at one time starting up is, that has ever been to the sectional and individual investment, as in the area and, then we have seen, the semi-time all- day event that if there is a hands-on(SPEAKER CHANGES) then dollars EDI maintain perceptions of these 0.4% interest in the movie charging in some businesses 30% rejecting the timecard only that his testimony yesterday when the 18% in these necessary time is, in the 18% of the stereo I've seen that you don't tell me can stymie that a fire in singer's environment before sending you the facts of the common many of the fact that major cities people whose lives of some teachers, single-time than that of the chairmanship-to-head-of-justice and time-consuming than 90% of the caption with that to those of the times, and that the cycle that they can operate it, the bodies and you leave his former wife writers of a ease interest rates apply and the massacre and all secured by real estate secure buyer for reinventing lifestyle of this is the unsecured scene has an enhanced-car or even years at itself into the store-high interest rates of the times and that a change of that organization that is only the only air fares when he states ; you're taking advantage of our times the best-known 49 the consumer funding activities of Anaheim these companies to charge more of this response to the data source:-14 in-Situ into these things, is on top of an interest rate hikes time this is not the finding of this summer's heat, have enough and the site to taking advantage of his time that the roles in those on the senate considers that all the time has raised in the season, many families are still struggling to recover from an economy Atty. general level of his time to what's necessary 101 that information ??????.......

as we contemplate-Mac is a decision as is currently constituted we have a RV Park association directors and narrow, since many of the morning times sun devils to where I think the team that handles his kitchen window and have a vested interest in the house all day and night the impacted by this time we can take the callers and paid about whether this deal is further today some investigation by the centers are citizens with one of china's 18% of homes in this configuration to thwart downtime out of the heavy charge and that's a 0.4% of the state of the services will be restrictions that have here because we don't want revenge the entire citizens have inactivated this is an age in this happen when making the cycle of a recent deal with them to be out of the season against the bill is presently constituted ??into the revised and updated and that's one thing that stands in a business that I'm a smoker on its channel, was more is more timely and acted as a result of the misfortunes within minutes after-school time, major's own medical bills are just as a result of being in the wrong place and one kind of you for your family member median prices paid to the stresses that ?? set of events in the house on this sentiment support for a minute chartered design as long as ??care-AM site of an AIDS benefit from them into a result of dry less- size of a strained center as one would be possible, in terms of entry into his room time as Howard have some tough times has been that is not saying the day of the of the season, and the then-service and that is the city and why has the ability is the date and not have another massive analyses of the safety of events is that a citizen of this U.S. fish in June , since a staff that he's not here is that the sentence in a recent study last year , for instance, on that confidence of the features an option of saying that we have more slender man that his time as the half-cent-a-half as his hands, then the design was only the name to change this and have a nice against one of those amounts end of a site with each of the of the stand-down to the one that the action when the less the packet of the reduced to 10,000-18%, and that was the fifth straight times that they were not have the right once again, make sure that was our best sentiment in the 271 of their much of a subdivision and the addresses of a time-of-seven-point about 25 years of often-time in the project seven-city Nevada --time-and-state region of the 46% of them have a higher timely and Saturday, the dissemination is that there are various women, and will continue, is that an issue that affects the seven-tasks than-team, and Jesse E percent, I mean, for that day and this is a 1. that the end-of-town Manhattan ????????......................

Internet right now. We don't even want to know what's going on. And we're seeing an alarming amount of folks starting to use sources, as we restrict credit here, they're going to go other places. So I would like to, however, ask you to support the amendment as presented. [SPEAKER CHANGES] Further discussion or debate on amendment five? [SPEAKER CHANGES] Mr. President. [SPEAKER CHANGES] Senator McKissak, for what purpose do you arise? [SPEAKER CHANGES] To ask the amendment's sponsor a clarifying question. [SPEAKER CHANGES] Senator Gunn, do you yield? Senator Clark, your microphone is on. [SPEAKER CHANGES] I do. [SPEAKER CHANGES] Thank you. [SPEAKER CHANGES] Senator Gunn, just for purposes of clarification, it's my understanding right now your bill allows the 18% between 10,000 to 15,000. Are you proposing that that 18% also go from 5,000 to 10,000? I just wanted to be clear. [SPEAKER CHANGES] I believe if I've got my amendment right. Originally we were 30 to five, 24 to 10, and 18 to 15, on a blended rate. What this amendment will do is say if you are taking a loan out between 10,000 and $15,000, we're going to fix that rate at 18%. [SPEAKER CHANGES] Thank you, sir. [SPEAKER CHANGES] Further discussion on amendment five? Senator Nesbitt, for what purpose do you arise? [SPEAKER CHANGES] Would Senator Gunn yield to a question? [SPEAKER CHANGES] He yields. [SPEAKER CHANGES] It'd make my Thursday afternoon. It's basically the same question. I still can't understand what you're doing. The chart I'm looking at shows 18 percent at a loan above 10,000 dollars. What's different? [SPEAKER CHANGES] I believe I'm answering this correctly. The way that the bill has been presented, it is a blended rate. It is a blended rate. In other words, you're going to pay 30 up to five, then when we go to between five and 10, it goes to 24, but those rates are blended, and if you go from 10 to 15, it would go down to 18, but all that is blended. With this, for the higher loans we're going to charge anything over 10 it will be a flat rate of 18% instead of a blended rate. [SPEAKER CHANGES] Further discussion or debate on amendment five? Hearing non, question before the senate is the passage of amendment five, the senate bill 489. All in favor will vote aye, all opposed will vote no. Five seconds will be allowed for the voting. The clerk will record the vote. 47 voted aye. 48 having voting in the affirmative, and none in the negative, amendment five to senate bill 489 passes, and the bill is back before you on second reading. Further discussion or debate? [SPEAKER CHANGES] Mr. President [SPEAKER CHANGES] Mr. President. [SPEAKER CHANGES] Senator Clodfelter, for what purpose do you arise? [SPEAKER CHANGES] Speak on the bill. [SPEAKER CHANGES] You have the floor. [SPEAKER CHANGES] Thank you, members. We've been at this for a while, and I apologize senator Brunstetter, I can see you, for taking more of your time. But I need to do that. The debate we've had so far shows how complicated this can be and how difficult this is to sort of sort through all the moving parts and try to find a place that's good for our folks. I think the bill does that, especially in light of the amendment that was added, and I need to sort of tell you why I think that. Many of you few who have been here for while know that I have been one of the most outspoken critics and opponents of the so-called payday lending industry, which has recently raised its head again in something called the advance, or the deposite advance kind of product, is currently receiving a lot of scrutiny from the control of the currency and the number of our larger banks are offering that, it's really payday lending in disguise. In part because of my position on that, I have felt it incumbent and be responsible about providing an alternative. It's not going to be sufficient to simply eliminate the bad industry without giving people an alternative and a better way to secure credit. They're going to need it, they're going to want it, they're going to have it. It's going to be provided in some way. And so, after an awful lot of study, an awful lot of frankly agonizing about it, I came to the position that maybe the best thing we can do here is to try to revive this industry, to extend this industry, to make the loan products offered by this industry available for another 30 years, as they've been available for decades in the past. I think there's a real question about whether that would

if we do nothing, if we simply sit and allow this regulatory structure put in place thirty years ago to simply continue unadjusted and unexamined and unreviewed, I do not believe this industry will be available to our citizens as a credit alternative in a very short period of time. Let me add to the debate some facts, some statistics. In 2007, the number of licensees offering loan products under these current chapters of the general statutes was had 586 licensed offices in the state. By 2011 the number of those offices had fallen by over a hundred to 488. When we check the number now in 2013 it's down further. It's now down to 458. These offices are closing all across North Carolina. When you look at the 2011 report of the Commissioner of Banks on the consumer finance industry, one thing struck me very powerfully. Most of these offices that this industry, the product of this industry provides, are in offices located in small towns, andrural communities, where there is virtually no other alternative source of credit. The banks have abandoned those communities. The large banks have abandoned those communities. And that's where those communities and the citizens there depend upon this industry as a source of old-fashioned, face-to-face credit. Where you can go into a store front in your community, and deal accross the desk with a live human being. Somebody who might understand if you need a payment deferral. somebody who might understand if you need a little bit of a slack on your loans. Somebody who can help you constructure a loan which best fits your repayment abilities rather than simply taking cash advance on an out of state credit card and then having a call center overseas somewhere deal with you when you've got a problem repaying your credit card monthly payments. I think that old-fashioned way of lending is really valuable. I think it's really valuable to consumers, and I think there is a real chance we will lose it if we do nothing. Senator McKissick, with all respect, the companies that are licensed in North Carolina, yes, Landmark and Springleaf are among them, but when you look down the list of licensees in North Carolina, they start off with Mutual Credit Company in Spruce Pine with one office. Career Home Services in Elkin, with one office. That's not a Florida office, by the way. The companies that are regulated by this industry in North Carolina are small and medium-sized lenders by and large. And they're having difficulty keeping the doors opened and providing the loan services in the community. As Senator Gunn said, the Commissioner of Banks analysis, which does an annual analysis, 52 percent of these licensees are showing net operating losses, that's a net operating loss, that's before you even take into account the cost of capital on your return on the investment made. You can't keep your doors open year after year, and that's why the number of offices is declining so dramatically. I think this is a good loan product for the reasons that I've said. If I'm in trouble and I need to talk to a loan officer, I can go to my bank in Charlotte. If I need some concession or some additional funding, or I need to restructure my loan, I can go to my bank officer in Charlotte. But in many communities this is the only option to have that kind of dialogue with a real lender. What's the alternative if we do nothing? You know what it is, we've talked a little bit about it here before. Typically, it's cash advance on a credit card. A credit card usually from an out-of-state lender who doesn't have to abide by any limits on interest rates in North Carolina, and is not regulated by the Commissioner of Banks, and then doesn't really care whether or not you amortize your loan, talk about a renewal problem. A cash advance on a credit card that carries from month to month to month to month to month to month indefinitely, and may never have the principle amortized -- that's high cost credit with renewal problems. Then when you need to do something about that can you get anybody on the phone to talk to? No. What are those alternative offerings? I took a look at a couple of them. Just picked a couple of credit cards of interest. One of them, I heard Senator McKissick refer to the position of the AARP on this legislation. AARP offers a credit card. You can get a cash advance on that credit card if you want to. Don't have to amortize it and ?? perpetually renewed. They'll take your interest every month and never amortize it. And then, if you add up the fees, the charges, the charge for the cash advance, the monthly APR on that cash advance, and you'd better hope you're neverlate, and by the way the late fee on that pay are

...credit card is higher than in this bill. You better hope you're never late, because the penalty interest rate--we'll talk about it in a minute-- but the APR on that cash advance is about 27.5%. From the first dollar up, all the way to the top. No blended rates. And if you're ever late, one day on one payment, APR is gonna charge you 30%, indefinitely. 30%. That's a number I think we've been talking about a little bit this morning. If you have your credit card from the NAACP-- a Visa card from the NAACP, and you wanna get a cash advance on that? You can do that, and then after you've paid the fees, and the monthly interest rate, your annual percentage rate is 31%, assuming you don't default, or miss a payment, or go late, and have to pay a penalty interest charge on top of that. That's the alternative source of credit we're leaving our people if we say to this industry: "We don't care what happens to you, it's OK if you go out of business-- no concern of ours." As an opponent of high-cost payday loans, I don't think it's a responsible approach to say that. The bill has been very carefully worked over; Senator Gunn has told you a number of the things-- provisions that have been put in the bill to try to address legitimate concerns that I think consumer advocates have. One of the things I want to talk about, and then I'll be done, is about renewals. Currently, under the current laws for the small loans, and by the way, I heard someone in the debate say that the small loans are not where the predominate lending activity is, it's in the bigger loans-- that's not correct. 70% of the loans are $3,000 or less. And they're made by these small lenders, with one and two offices, in small towns in North Carolina-- they're not made by Landmark and Springly [?]. The bulk of those loans are made at $3,000 or less. Right now, there's no minimum loan turn on those, they'll make you that loan for a month. And if they make you a loan for a month, you're gonna have a lot of renewals-- can yo pay off a $2,000 loan from your next paycheck at the end of the month? Most citizens in North Carolina can't do that, and so that's where the renewal problem comes. The bill addresses that; the minimum term now has to be at least 12 months. You could structure a monthly payment that actually fits your income. You might actually be able to make that repayment and not have to renew. The maximum loan terms are extended as well to give more flexibility to the lender and the borrower who needs the funds to work out a repayment program that they can afford on a monthly basis. The best way to avoid renewal problems is to make an affordable monthly payment. On an [??] loan; Senator Gunn talked about that, and I agree with him 100%. The bill also provides mechanisms for payment referral to be allowed, you don't have to renew your loan. You don't have to go in a pay a bunch of up-front fees to renew a loan. If you need an extension on a payment, the bill allows the lender to give you an extension, or a payment referral. I think that's a positive development, and a positive change in the law. Before that, the lenders have to be able to stay in business. That's what the bill's about: to stay in business, offering credit to consumers who want it, who need it, and can manage it responsibly. Don't leave them with no alternative. I ask that you support the bill. [SPEAKER CHANGES] Further discussion or debate. Senator Kinnaird, for what purpose do you rise? [SPEAKER CHANGES] To speak to bill. [SPEAKER CHANGES] You have the floor. [SPEAKER CHANGES] We've heard two or three varying sides, and I appreciate the amendments, I think that they have improved the bill, including the last one, Senator Brown, I appreciate that. However, we've also heard from others, AARP, other military branches, and I've been watching this for a long time. As a matter of fact, I've been watching the last two terms as sixteen years worth of my work has been taken apart piece by piece, but I think this one hurts more than the others. The fundamental question for me is-- and you have to realize where I'm coming from-- why the wealthy wish to oppress those who have nothing? To squeeze the last little bit out of those who are just barely struggling. So why this bill? Industry will tell you that they have not had an increase since 1983, well, they don't need an increase. Why? Because the industry make money not only on the high interest rates, but really, the loans being recurring, whatever you want to call them, and selling insurance products. Remember the insurance product is the largest part of the amount of profit they make. Here's a typical--

?? right here. Amount borrowed ended up as 2000. Finance charge $979, one half almost. Insurance $411. And each time this loan is renewed, if you want to call it that, those fees are charged again. 66 percent of the loans in 2011 were renewed. 90 percent, 92 percent of the loans with insurance products were funded from loan proceeds. So you can see that we're not just talking about interest. And yes, it hasn't been raised since 1993, but they don't need to because they make their money these other ways. Then, a late fee of $15 on an $82 payment. For example, ?? paid $82 per month for 36 months and ended up getting $1.27 the last time they renewed the loan, because all the rest went to insurance, finance, and late fees. So, if the person is squeezed to the point of default, the lender has already made money on insurance products, late fees and finance charges. While this poor person ends up in an endless debt cycle, until they end up in court. Industry says they don't make enough on the business. Look at their income over expense. In 2011, $277,500, which is the income, and the expense is 263,000. Tidy little profit there. They'll tell you the company's lost money during that period, but not if you look at the figures. The industry, and Senator Clodfelter, says they didn't make enough loans, but how about 461,560 in 2011. The industry says they help people by lending money who have bad credit. If they really mean that they would lend money at the same rate as their Credit Unions program with a built in default cushion for the lender. Now, you may think this is about that small, humble businessman who sat in your office in his thrift shop suit and said he can't make a living without the changes in this bill. But this bill is really about the city. And their parent, City Financial. This is about Springleaf, nay AIG, aka Fortress American General. A private hedge fund. This is about Landmark, BB&T, based in Georgia. Owned by BB&T and six out of state companies. The military has rightfully been opposed to this bill and defeated it last time around, but this year the industry hired a retired military general who persuaded them to stay neutral after exempting military personnel from the bill. Well, if it is bad for the armed services, why is it okay of the rest of the people? And two service branches are still opposed because it preys on military families. This is about the unsophisticated borrower, as Senator Clodfelter said, you and I aren't going to take out these loans. This is about rich and poor. City Corp paid a CEO 11.5 million in 2012. This is not about that simple man just trying to make his living in your hometown. Nor is the CEO of City Corp going to take out this, because he's collecting all those late fees, and insurance products, and interest on hundreds of thousands of loans and living well. What differentiates the well-off, the comfortable from those who are struggling and seeks the loan is wealth accumulation. A home bought with a mortgage is wealth accumulation, investment and stocks or bonds, real estate, but when you're at the bottom financially, you never accumulate wealth. How can you accumulate wealth when you have to pay back $520 in fees when you have to borrow $325? I had a personal experience like that. Senator Brown, you asked if anyone would take this kind of risk. A grandmother, whom I've worked with for years, was taking care of her daughter in a wheelchair and her granddaughter with a neurological illness and she was forced to take out one of these loans. After a year, she owed $1600 on her $1000 loan, and a deputy sheriff came to me because they were taking her to court. I couldn't take it anymore, and I went in and I paid off that loan, and I said, don't go after her for one more penny. These folks not only can't live comfortably, they have nothing to leave their children. I think this is a moral issue. We have differences on moral issues for some it is death penalty, for some it's the beginning of life, but I think we can all agree that what we hear every Sunday is as you do unto the least of these. I hope that we will deeply consider what we are

doing to thousands of people in our state, I intend to vote against the bill. [SPEAKER CHANGES] Mr. President.[SPEAKER CHANGES] Senator Clark, what purpose you rise. [SPEAKER CHANGES] To speak to the bill.[SPEAKER CHANGES] You have the floor.[SPEAKER CHANGES] When I first entered the Air Force I was over there in Germany on a tour. And I can remember I had only been at the site for about four months, Belburg(??) Air Force Station Germany, and the Commander was relieved of duty. Since there were only two officers at the site, I had to assume command of that site. Okay and I can remember during that time all of a sudden things changed. I can remember heading from the mountain top down into Frankfurt Germany to my apartment--[SPEAKER CHANGES] President, point of order. How many times do we get to speak on the bill from the floor? [SPEAKER CHANGES] This is my first time speaking to the bill. [SPEAKER CHANGES] Senator Tillman, the rules say that each member is allowed to speak twice on the main question. [SPEAKER CHANGES] Maybe I'm mistaken, but I thought I've heard two at least. [SPEAKER CHANGES] I've spoken to all the amendments, this is my first--[SPEAKER CHANGES] Senator Clark you have the floor, speak to the bill. [SPEAKER CHANGES] Okay. So as I'm heading home often times the beeper goes off 'Lieutenant Clark will you call the site, Lieutenant Clark will you call the site.' And more often than not, it was some sort of domestic dispute that had taken place in the home. And often times the result of that dispute was financial problems. Later on in my career as an Air Force Captain stationed at Scott Air Force Base, I served as a financial program manager, assisting the troops who found themselves strapped with financial debt. Often times these loans were the culprit. So I did not put forth all of those amendments for the sake of voting against the bill. I put forth those amendments out of a true concern for the military members. But I also do recognize that I can't have my way in everything. And I applaud Senator Gunn for the concessions that he has made, accepting several of the amendments. And I believe that-- blended rate, pretty much will give you better than what you can get off a credit card, I mean non-blended rate excuse me, the non-blended rate that he offered. Also, although I would like to have the military components stricken out of the bill, I do believe that they will get a better deal based on the amendment that Senator Gunn put forth. I only ask one more thing. I believe Senator Gunn you indicated that the bill is written, not allow anyone to turn and request the loan until the current loan had been paid off. I can't find that in the bill, I'm not saying its not there, but I can't find it. If it was the intent to have that provision in there so that an individual can not refinance that loan until the residual(?) had been paid off, if it gets put in I will appreciate that, and then I would recommend that we support the bill. [SPEAKER CHANGES] Senator Davis, what purpose you rise? [SPEAKER CHANGES] To offer an amendment, a very simple amendment. [SPEAKER CHANGES] The Clerk has your amendment, the Clerk will read. [SPEAKER CHANGES] Senator Davis moves to amend the bill. [SPEAKER CHANGES] Members, hold on just a moment. The amendment is on the dashboard. Senator Davis you have the floor. [SPEAKER CHANGES] Thank you Mr. President if you look on page two line, twenty three, the language of my amendment just clarifies the fact that the maximum amount of $15,000 dollars refers to the loan and not to the installment amount. I think that's pretty important. In addition to that line 24, while we're at it using proper English, we might as well fix 'less than 12 months' to 'fewer than 12 months'. I ask that you support the amendment out of respect to your sixth grade English teacher. [SPEAKER CHANGES] Senator Gunn, for what purpose you rise.[SPEAKER CHANGES] Kinda hard to argue with that. To speak-- reckon to the amendment [SPEAKER CHANGES] If I'm hearing Senator Davis correctly, you are assuming this language is going to make sure that it is not a $15,000 installment. Is that correct? Or is that a monthly installment? [SPEAKER CHANGES] Senator Davis, yield. [SPEAKER CHANGES] I yield. That is correct I think a $15,000 installment is a pretty good size installment. [SPEAKER CHANGES] Senator Gunn you have the floor.

I will support the grammar teacher. [SPEAKER CHANGES] Further discussion or debate? [SPEAKER CHANGES] Senator Stein, for what purpose do you rise? [SPEAKER CHANGES] A question for the bill sponsor which I know he won’t know because I’m looking on the internet, trying to find it myself, is “installment loan” a defined term? My only concern is by taking out the word “installment”, even though I agree with Senator Davis is doesn’t make sense as a matter of language, because if it is a defined term, it might be creating some confusion on the statute. [SPEAKER CHANGES] Senator Gunn, do you yield? [SPEAKER CHANGES] Yes, but I’m not sure to what. [SPEAKER CHANGES] Senator Stein, would you restate your question, please. [SPEAKER CHANGES] Is “installment loan” a defined term in the statute? [SPEAKER CHANGES] By my pay scale. [SPEAKER CHANGES] Mine too. [SPEAKER CHANGES] ?? [SPEAKER CHANGES] I would like to inquire… [SPEAKER CHANGES] We can object to third reading and get that resolved, but I don’t have a problem with Senator Davis’s amendment, but I just wanted to make sure we weren’t creating a problem. [SPEAKER CHANGES] Further discussion or debate on Amendment 6? Hearing none, the question for the Senate is the passage of Amendment 6, Senate Bill 489. All in favor will vote, “Aye”. All opposed will vote, “No”. Five seconds will be allowed for voting. The clerk will record the vote. Forty-eight having voted in the affirmative and none in the negative. Amendment 6 has passed. Senate Bill 489 is back before you all at second reading. Further discussion or debate? Hearing none, the question before the Senate is the passage of Committee Substitute to Senate Bill 489 on its second reading. All in favor will vote, “Aye”. All opposed will vote, “No”. Five seconds will be allowed for the vote. The clerk will record the vote. Thirty-nine having voted in the affirmative and nine in the negative. Senate Bill 489 is passed at second reading and will, without objection, be read for a third time. [SPEAKER CHANGES] North Carolina General Assembly enacts. [SPEAKER CHANGES] Mr. President, I object to third reading. [SPEAKER CHANGES] Third reading having been objected to while Senate Bill 489 will remain on the calendar. [SPEAKER CHANGES] Mr. President. [SPEAKER CHANGES] Senator Brunstetter, for what purpose do you rise? [SPEAKER CHANGES] Motion to amend a committee report. [SPEAKER CHANGES] State your motion. [SPEAKER CHANGES] Mr. President, Senate Bill 59: Armed security guards in K through 12 is in the committee on rules. We ask that it be removed from the committee on rules and be re-referred to the committee Judiciary 2. [SPEAKER CHANGES] Without objection? So ordered. Committee report? Send forward your committee report. [SPEAKER CHANGES] Mr. President, this be an oral committee report. The Oximeter Committee did meet and there’s a lot of competition for the award this time, but the committee has decided to award the Oximeter to the President Pro Temp, Phil Berger, for his policy for not allowing the rules chair to call the question. [SPEAKER CHANGES] Accepted with great appreciation. Senator Newton has an excused absence for the remainder of the session. With reference to… Next item, Senate Bill 493. The clerk will read. [SPEAKER CHANGES] Senate Bill 493: Prohibit after ?? headlights. [SPEAKER CHANGES] Senator Walters is recognized to explain the bill. [SPEAKER CHANGES] Thank you, Mr. President. Senate Bill 493, basically, is a very simple bill. It prohibits the use of headlights that are not DOT stamped or DOT approved. This has come from a safety issue. We have some members of the motor public that change their headlights to different counter powers or different colors that blind people on the highway. But all this does is change it to DOT approved. Thank you. I would appreciate your support. [SPEAKER CHANGES] Further discussion or debate? Senator Clark, your microphone appears to be on. Further discussion or debate? Hearing none, the question before the Senate is the passage…

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Senate Bill 304 has a serial referral to appropriations based budget. Senate Bill 354 and Senate Bill 558, calendar. [SPEAKER CHANGES] Mr. President. [SPEAKER CHANGES] Senator Bryant, for what purpose do you rise? [SPEAKER CHANGES] Moment of personal privilege, please. [SPEAKER CHANGES] You have the floor. [SPEAKER CHANGES] Thank you. Mr. President and members of the Senate, on Monday, in the 7:00 session, the resolution for Senator Edward Jones will be calendared for that session and at 6:30 that evening his family will be here and we will have a repass for them that you’re all invited to, in the gallery outside the Senate chamber. If you could just stop by to greet them that would be wonderful because, after the resolution, they will probably move on and we might not have a chance to share memories and our recollections with them. Thank you. [SPEAKER CHANGES] Is there further business to come before the Senate? If not, the Chair recognizes Senator Brunstetter for a motion. [SPEAKER CHANGES] Mr. President, I move that the Senate do now adjourn, subject to the receipt of committee reports, the referral and re-referral of bills and resolutions, and the receipt of messages from the House and the governor, to reconvene on Monday, May 6, 2013 at 7 p.m. [SPEAKER CHANGES] The motion is that the Senate do now adjourn, subject to the stipulations stated by Senator Brunstetter, to reconvene Monday, May 6th at 7 p.m., seconded by Senator Hise. All in favor say aye. All opposed? The ayes have it and the Senate stands adjourned.