From the Office of Representative Larry D. Hall

August 20, 2008

While our economy in North Carolina remains solid compared with much of the nation, parts of our state and some sectors of our industries have been challenged in recent months by financial pressures. The struggles of the mortgage industry have been particularly difficult for many people at risk of losing their homes and we have passed several laws to address this crisis.

This session, my colleagues and I made it a priority to help families make ends meet by protecting homeowners, expanding job opportunities and increasing incomes. This was an area of vital importance for everyone in this state and I’m pleased that we addressed these concerns in a number of ways. I have outlined some of the major initiatives in this newsletter and I know that we will return next session prepared to continue working to protect the economy and jobs of this state in whatever way we can.

In my efforts to work on financial challenges affecting our community, I volunteered for and was appointed to the Study Committee on Unbanked and Underbanked Consumers by Speaker Joe Hackney.  We will have our first meeting on August 21, 2008 and I will keep you posted on the progress.  If you have any concerns or wish to make suggestions on these challenges please contact me or our legislative assistant, Ms. Lisa Ray.

Thank you as always for your interest in the work of state government and please let me know if I can be of any service. Again, I look forward to continuing to work with you to serve the interests of people of our state and district.

Protecting Homeowners -   One new law approved this session will give mortgage holders more time to work out a plan with their banks before losing their homes. The bill (H2623) requires lenders to give homeowners 45 days notice before starting foreclosure proceedings and gives the state bank commissioner authority to delay foreclosures for 30 days in hopes of coming up with a new payment plan. Gov. Mike Easley was among the major supporters of the bill and recently signed it into law.

Another new law (H2188) will require home loan servicers to provide anyone taking out a mortgage with information about servicer fees within 30 days of the activation of those fees. The fee would be waived if the servicer fails to notify the receiver of the mortgage.

Mortgage servicers must now earn a license under a new law (H2463) that makes it against the law to operate without one. The license would expire annually. This bill also clarifies the Mortgage Lending Act by describing in detail the qualifications and duties of a mortgage lender.

The General Assembly also invested more money in programs that help families protect their homes from foreclosure. In the state budget, we allocated $3 million for the Home Protection Pilot Program operated by the North Carolina Housing Finance Agency. This additional money will allow the program to expand to 39 additional counties so that the entire state is covered. The program assists workers who have lost their jobs by providing qualified homeowners interest-free loans while they look for new jobs. Homeowners who apply to the program are granted a 120-day stay of foreclosure.

The state increased spending for the Housing Trust Fund by $2 million to raise its yearly budget to $10 million. The Housing Trust Fund helps provide decent, safe and affordable housing to North Carolina citizens with low to moderate incomes.

Taxes - The General Assembly approved a finance package this year that didn’t raise any taxes while at the same creating or extending a number of tax credits to help more families and small businesses keep the money they earn. These tax breaks include:

Expansion of the Earned Income Tax Credit to 5 percent beginning January 2009. This refundable tax credit is expected to help an estimated 800,000 people in the state who earn about $40,000 a year or less by lessening their tax burden and in some cases returning money to them.

• $8.5 million to extend a tax credit for small businesses that provide health benefits to their employees

Creation of a disabled veterans' property tax homestead exclusion to give disabled veterans and their surviving spouses a break on their property taxes

$1.4 million for a three-day sales tax holiday in November on energy-efficient appliances

$1 million to extend a tax credit for the use of the state ports

$1 million to extend a tax credit for investment in research and development

Conformity to provisions in the federal tax code to make compliance with the tax laws easier

Repeal of the state gift tax in 2009

$2.2 million for clarifications to reduce the amount of the State estate tax

$1.9 million for sales tax breaks for artisan bakeries, interior designers, and equipment refurbishers

Expansion of the tax credit for investment in a qualified business venture

Business Incentives -  Although most states would prefer not to spend any money for incentives, the existing competitive environment does not make that possible at this time. This year, the state has set aside $23.5 million for business recruitment. The Job Development Investment Grant, or JDIG, program received $15 million. JDIG grants are awarded only to new and expanding businesses and industrial projects with benefits that exceed the costs to the state and which would not be undertaken in North Carolina without the grant. Since the first grant was awarded in 2003, the program has helped create more than 28,000 jobs and $4 billion in investment in North Carolina. The General Assembly also appropriated $5 million for the One NC Fund and $3.5 million for the One NC Small Business Fund. The One North Carolina Fund provides financial assistance to attract business projects that will stimulate economic activity and create jobs. One North Carolina Fund grants require local matching funds and have helped create more than 30,000 jobs and $6 billion in investment since 2001.

Education - Our state spent more than $11 billion this year on education with the intention of creating stronger families and a stronger workforce. One of the ways we are helping build our workforce is through increased attention to the rapidly growing technical and allied health fields. This past session, the General Assembly appropriated $1 million to re-establish and place renewed emphasis on community college technical education programs. The money may be used for faculty, equipment or supplies in programs for construction, engineering, industrial, and transport systems technologies. The legislature also set aside an additional $4 million to expand high-cost community college allied health programs, such as practical nursing, pharmacy technology, surgical technology, therapeutic recreation and others. This money may be used for faculty, equipment, supplies or National League of Nursing Accreditation fees. This money is in addition to the $5.6 million already in the state’s base budget for this purpose and will be distributed to each of the state’s community colleges based on enrollment in these programs.

Notes -  House Speaker Joe Hackney has been named president of the National Conference of State Legislatures, a bipartisan organization that serves the nation’s nearly 7,400 state lawmakers. As president, Speaker Hackney will lead NCSL’s efforts to lobby the federal government. Last year, Speaker Hackney received NCSL's Excellence in State Legislative Leadership Award, the nation’s top honor for state legislators.

Larry D. Hall

Please remember that you can listen to each day’s committee meetings and press conferences on the General Assembly’s website at http://www.ncleg.net.  Once on the site, select “audio,” and then make your selection. You can also use the website to look up bills, view lawmaker biographies and access other information.