Senate committee substitute makes the following changes to the 1st edition.

Section 1

Makes a clarifying change to GS 14-118.6(b1), concerning the filing of a false lien or encumbrance.

Section 2

Amends GS 20-45, concerning seizure of documents and plates by the Division of Motor Vehicles, to make a technical change to subsection (a) and to make the language of subsection (b) gender neutral. Makes technical change to the statutory reference in subsection (c).

Section 7

Makes technical changes to GS 36C-8-816.1(c)(9), concerning a trustee's special power to appoint to a second trust and the required terms of the second trust. Makes clarifying change to subdivision (9) of subsection (c) to provide that the terms of the second trust cannot contain any provisions that would jeopardize any other specific tax benefit for which the first trust was clearly designed to qualify and for which the first trust qualified or would have qualified but for the enactment of the statute (previously, cannot jeopardize any other tax benefit for which a contribution qualified for income, gift, estate, or generation skipping transfer tax purposes).

Repeals GS 39-33, which provides for the method of release or limitation of the power of appointment. Repeals GS 39-34, which referred to the method in GS 39-33.

Recodifies GS 39-35, concerning requisites of release or limitation of a power of appointment as against creditors and purchasers for value, as GS 31D-5-505.

Recodifies GS 39-36, concerning necessity for actual notice of release or limitation of the power of appointment to bind fiduciary, as GS 31D-4-403.1.

Amends GS 42A-17(a), concerning accounting and reimbursement under the Vacation Rental Act, to require a vacation rental agreement to identify the name and address of the federally insured depository institution (previously, the bank or savings and loan association) in which the tenant's security deposit and other advance payments are held in a trust account.

Makes technical changes to GS 97-25, concerning motions and responses regarding a request for medical compensation or a dispute involving medical issues in claims subject to GS 97-18(b) (concerning payment installments) and (d) (concerning payment installments made without prejudice).

Section 9

Repeals GS 120-57, which empowered and directed the Legislative Intern Program Council to promulgate a plan for the selection and use of legislative interns for each session of the General Assembly.

Makes a technical change to the statutory reference in subsection (c) of GS 136-41.2, concerning the eligibility of municipalities to receive funds under GS 136-41.1, by referencing GS 159-8 and GS 159-13 (annual balanced budget ordinance) instead of GS 160-410.3 (repealed and transferred).

Makes technical changes to GS 143-215.31(a1), which directs the owner of a dam classified by the Department of Environmental Quality as a high hazard dam or an immediate-hazard dam to develop an Emergency Action Plan for the dam, as specified. Amends subdivision (6) to provide that, for purposes of the statute, sensitive public security information includes Critical Energy Infrastructure Information protected from disclosure under rules adopted by the Federal Energy Regulatory Commission in 18 CFR 388.112 (previously, 18 CFR 333.112).

Amends GS 143B-168.5 to specify that the establishment of a special unit to deal primarily with violations involving child abuse and neglect in child care arrangements be within the Department of Health and Human Service, Division of Child Development and Early Education (previously, did not specify a division of DHHS). Further, makes technical change to directive that the Child Care Commission make rules for the investigation of reports of child abuse or neglect and for administrative action when child abuse or neglect is substantiated, pursuant to GS 110-88(6a), GS 110-105, GS 110-105.3, GS 110-105.4, GS 110-105.5, and GS 110-105.6 (replaces GS 110-105.2 with GS 110-105.3 through GS 110-105.6 concerning child mistreatment).

Makes technical change to GS 143B-931(b), concerning criminal records checks of school personnel, to replace the statutory reference to GS 115C-238.56N with GS 115C-238.73 (criminal history record checks of regional school employees).

Amends GS 143C-6-4(b), concerning budget adjustments in the administration of the budget, to replace the statutory reference to GS 166A-19.40(a) in subdivision (2), allowing a State agency to spend more than was appropriated in the certified budget, with approval of the Director of the Budget, to adjust for responses to extraordinary events authorized by that statute, to instead specify authorization under GS 166A-19.40(a)(1) (allowing for the use of contingency and emergency funds by the Governor as necessary and appropriate to provide relief and assistance from the effects of an emergency) and (c) (providing four conditions that must be satisfied for the Governor to reallocate other funds reasonably available within the appropriations of the various departments).

Section 10

Makes technical correction to statutory reference in GS 147-12(a), concerning the powers and duties of the Governor.

Section 14

Makes technical change to the introductory language of Section 54.5(b) of SL 2015-264.

Section 15

Amends GS 1A-1, Rule 22 (Interpleader), to provide that where funds are subject to competing claims by parties to the action, the court can order a party in possession of the funds to either deposit the funds in an interest bearing account in a federally insured depository institution or a trust institution authorized to do business in the State (previously, in a bank, savings and loan, or trust company licensed to do business in the State) or to deposit the funds with the clerk. Makes conforming changes.

Amends GS 20-63.01(c), concerning bonds required for commission contractors, to provide that, with the approval of the Division of Motor Vehicles, an applicant may file with the clerk of superior court or the register of deeds or both of the county in which the commission contractor will be located, in lieu of a bond, (1) an assignment of a savings account, as specified, which is executed by a federally insured depository institution lawfully doing business in the State (previously, executed by a state or federal savings and loan association, state bank, or national bank that is doing business in North Carolina and whose accounts are insured by a federal depositors corporation) or (2) a certificate of deposit, as specified, which is executed by a federally insured depository institution lawfully doing business in the State (previously, executed by a state or federal savings and loan association, state bank, or national bank that is doing business in North Carolina and whose accounts are insured by a federal depositors corporation).

Amends GS 85B-7.1(a), concerning the handling of clients' funds by auctioneers, to require the licensee to deposit funds that are not disbursed on auction day with a federally insured depository institution (previously, with an insured bank or savings and loan association) located in North Carolina. Makes conforming changes to GS 85B-8(a)(7), concerning prohibited acts that are grounds for the assessment of a civil penalty or the denial, suspension, or revocation of an auctioneer, auctioneer apprentice, or auction firm license.

Amends GS 86A-22(7)c, concerning bonds required for barber schools and colleges, to provide that an applicant, with approval of the Board of Barber Examiners, may also file with the clerk of superior court in the county in which the school will be located, in lieu of the bond, (1) an assignment of a savings account, as specified, which is executed by a federally insured depository institution lawfully doing business in the State (previously, executed by a state or federal savings and loan association, state bank, or national bank that is doing business in North Carolina and whose accounts are insured by a federal depositors corporation) or (2) a certificate of deposit, as specified, which is executed by a federally insured depository institution lawfully doing business in the State (previously, executed by a state or federal savings and loan association, state bank, or national bank that is doing business in North Carolina and whose accounts are insured by a federal depositors corporation).

Amends GS 88B-17(c), concerning bond required for private cosmetic art schools, to provide that an applicant, with the approval of the Board of Cosmetic Art Examiners, may file with the clerk of superior court in the county in which the school will be located, in lieu of the bond, (1) an assignment of a savings account, as specified, which is executed by a federally insured depository institution lawfully doing business in the State (previously, executed by a state or federal savings and loan association, state bank, or national bank that is doing business in North Carolina and whose accounts are insured by a federal depositors corporation) or (2) a certificate of deposit, as specified, which is executed by a federally insured depository institution lawfully doing business in the State (previously, executed by a state or federal savings and loan association, state bank, or national bank that is doing business in North Carolina and whose accounts are insured by a federal depositors corporation).

Amends GS 90-171.55, concerning the bond required for each nurses aid training program, to provide that an applicant, with the approval of the Board of Nursing, may also file with the clerk of superior court in the county in which the school will be located, in lieu of the bond, (1) an assignment of a savings account, as specified, which is executed by a federally insured depository institution lawfully doing business in the State (previously, executed by a state or federal savings and loan association, state bank, or national bank that is doing business in North Carolina and whose accounts are insured by a federal depositors corporation) or (2) a certificate of deposit, as specified, which is executed by federally insured depository institution lawfully doing business in the State (previously, executed by a state or federal savings and loan association, state bank, or national bank that is doing business in North Carolina and whose accounts are insured by a federal depositors corporation).

Amends GS 90-210.86, concerning the deposit or investment of funds of mutual burial associations, to require investment in deposits in any federally insured depository institution or any trust institution authorized to do business in the State (previously, any bank or trust company in the State).

Amends GS 93A-3(b), concerning the compensation of the North Carolina Real Estate Commission, to provide that the Commission may deposit moneys in accounts, certificates of deposit, or time deposits as the Commission may approve, in any federally insured depository institution or any trust institution authorized to do business in the State (previously, in any bank, savings and loan association, or trust company).

Amends GS 93A-42(d) to require the independent escrow agent provided in subsection (c)(2) of the statute to deposit and maintain the purchaser's payments of a time share real property interest in an insured trust or escrow account in a federally insured depository institution lawfully doing business in the State (previously, in a bank or savings and loan association located in the State). Makes conforming changes to GS 93A-45, concerning purchaser's right to cancel, escrow, and violations of Article 4 of GS Chapter 93A (Time Shares).

Section 16

Amends GS 20-63.01(c) (bonds required for commission contractors), as amended by Section 15, to provide that an applicant, with the approval of the Division of Motor Vehicles, may file with the clerk of superior court in the county in which the school will be located, in lieu of the bond, (1) an assignment of a savings account, as specified, which is executed by a federally insured depository institution or a trust institution (previously, did not include a trust institution) authorized to do (previously, lawfully doing) business in the State or (2) a certificate of deposit, as specified, which is executed by a federally insured depository institution or a trust institution (previously, did not include a trust institution) authorized to do (previously, lawfully doing) business in the State.

Amends GS 42-50, concerning deposits from the tenant under the Tenant Security Deposit Act, to require that the security deposits from the tenant in residential dwelling units are deposited in a trust account with a licensed and federally insured depository institution or a trust institution (previously, did not include a trust institution) authorized to do (previously, lawfully doing) business in the State or as specified. Makes language gender neutral. 

Amends GS 42A-15, concerning trust account uses under the Vacation Rental Act, to provide that, if the tenant is required to make any advance payments, other than a security deposit, whether the payment is denominated as rent or otherwise, the landlord or real estate broker must deposit the payments in a trust account in a federally insured depository institution or a trust institution (previously, did not provide for a trust institution) authorized to do (previously, lawfully doing) business in the State.

Amends GS 42A-17(a) (accounting and reimbursement under the Vacation Rental Act), as amended by Section 7, to require a vacation rental agreement to identify the name and address of the federally insured depository institution or trust institution (previously, did not provide for trust institution) in which the tenant's security deposit and other advance payments are held in a trust account.

Amends GS 47C-4-110(a), concerning escrow of deposits under the North Carolina Condominium Act, to require that any deposit made in connection with the purchase or reservation of a unit from a person required to deliver a public offering statement pursuant to GS 47C-4-102(c) must be immediately deposited in a trust or escrow account in a federally insured depository institution or a trust institution (previously, did not provide for a trust institution) authorized to do (previously, lawfully doing) business in the State and remain as specified.

Amends GS 85B-7.1(a) (handling of clients' funds by auctioneers), as amended by Section 15, to require the licensee to deposit funds that are not disbursed on auction day with a federally insured depository institution or a trust institution authorized to do business in the State (previously, with a federally insured depository institution located in North Carolina). Makes conforming changes to GS 85B-8(a)(7), as amended by Section 15, concerning prohibited acts that are grounds for the assessment of a civil penalty or the denial, suspension, or revocation of an auctioneer, auctioneer apprentice, or auction firm license.

Amends GS 86A-22 (bonds required for barber schools and colleges), as amended by Section 15, to provide that an applicant, with approval of the Board of Barber Examiners, may file with the clerk of superior court in the county in which the school will be located, in lieu of the bond, (1) an assignment of a savings account, as specified, which is executed by a federally insured depository institution or a trust institution (previously, did not provide for a trust institution) authorized to do (previously, lawfully doing) business in the State or (2) a certificate of deposit, as specified, which is executed by a federally insured depository institution or a trust institution (previously, did not provide for a trust institution) authorized to do (previously, lawfully doing) business in the State.

Amends GS 88B-17 (bond required for private cosmetic art schools), as amended by Section 15, to provide that an applicant, with the approval of the Board of Cosmetic Art Examiners, may file with the clerk of superior court in the county in which the school will be located, in lieu of the bond, (1) an assignment of a savings account, as specified, which is executed by a federally insured depository institution or a trust institution (previously, did not provide for a trust institution) authorized to do (previously, lawfully doing) business in the State or (2) a certificate of deposit, as specified, which is executed by a federally insured depository institution or a trust institution (previously, did not provide for a trust institution) authorized to do (previously, lawfully doing) business in the State.

Amends GS 90-171.55 (bond required for each nurses aid training program), as amended by Section 15, to provide that an applicant, with the approval of the Board of Nursing, may file with the clerk of superior court in the county in which the school will be located, in lieu of the bond, (1) an assignment of a savings account, as specified, which is executed by a federally insured depository institution or a trust institution (previously, did not provide for a trust institution) authorized to do (previously, lawfully doing) business in the State or (2) a certificate of deposit, as specified, which is executed by a federally insured depository institution or a trust institution (previously, did not provide for a trust institution) authorized to do (previously, lawfully doing) business in the State.

Amends GS 93A-42 (d), as amended by Section 15, to require the independent escrow agent provided in subsection (c)(2) of the statute to deposit and maintain the purchaser's payments of a time share real property interest in an insured trust or escrow account in a federally insured depository institution or a trust institution (previously, did not provide for a trust institution) authorized to do (previously, lawfully doing) business in the State. Makes conforming changes to GS 93A-45, as amended by Section 15, concerning purchaser's right to cancel, escrow, and violations of Article 4 of GS Chapter 93A (Time Shares).

Repeals GS 14-27.23(c) (statutory rape of a child by an adult) and GS 27.28(c) (statutory sexual offense with a child by an adult), allowing a court to sentence a defendant to active punishment for a term of months great than that authorized by GS 15A-1340.17, up to and including life imprisonment without parole, if the court finds that the nature of the offense and the harm inflicted are of such brutality, duration, severity, degree, or scope beyond that normally committed in such crimes, or considered in basic aggravation of the crimes, so as to require a sentence in excess of that authorized under GS 15A-1340.17. These provisions were found unconstitutional by the North Carolina Court of Appeals (in State v. Singletary).

Amends GS 31D-5-505 (requisites of release or limitation as against creditors and purchasers for value), as recodified by Section 7, to remove references to limitation of a power of appointment from both the title and the provisions, leaving the statute to provide for only the requisites for release of a power of appointment as against creditors and purchasers for value.

Amends GS 36C-5-505(c), concerning a creditor's claim against a settlor under the North Carolina Uniform Trust Code, to provide that, if the settlor is a beneficiary after the death of the settlor's spouse, an irrevocable inter vivos trust, of which the settlor's spouse is a beneficiary during the spouse's lifetime but which does not qualify for the federal gift tax marital deduction, and during the lifetime of the settlor's spouse (1) the settlor's spouse is the only beneficiary or (2) the settlor's spouse and any issue of the settlor or the settlor's spouse, or both, are the only beneficiaries (previously, only provided for the settlor's spouse and the settlor's issue to be the only beneficiares), then the property is not considered to have been contributed by the settlor and a person who would otherwise be treated as a settlor or a deemed settlor of the trust cannot be treated as a settlor, and is therefore not subject to claims by creditors of the settlor spouse.

Amends GS 39-13.7, concerning tenancy by the entireties trusts in real property, by adding two new subsections. Provides that notice that the real property held in trust will receive immunity from the claims of separate creditors can be given in a statement in the conveyance of the tenancy by the entireties real property to the trust that the real property is held under the statute, and that as of the date of the conveyance, the requirements of subsection (b) are met (which provides three conditions that must be met for the immunity from the claims of separate creditors to apply to the property in trust). Allows a person entering a transaction involving real property held in trust under the statute to request confirmation from the trustee whether the requirements of the statute providing immunity from the claims of separate creditors are met at the time of the transaction.

Amends GS 62-133.10, concerning the retention of fuel and fuel-related cost savings associated with the purchase or construction of a carbon offset facility, to amend the first requirement that a facility in the State must meet to constitute a carbon offset facility, for purposes of the statute. Now requires the facility to be purchased or constructed by an electric public utility (previously, required the facility to be purchased or constructed by an electric public utility between July 1, 2009, and July 1, 2014).

Directs that, if S 734 of the 2016 Regular Session of the 2015 General Assembly (Statewide Standing Order/Opioid Antagonist) becomes law, then subsection (b1) of GS 90-12.7 (Treatment of overdose with opioid antagonist), as enacted by S 734, is to make a technical change to reference subdivision (1) of subsection (b) of the statute (currently, subdivision (b)(1)).

Section 17

Amends GS 90-91(k), establishing anabolic steriods as a schedule III controlled substances, to make formatting changes. Also adds a new exception to the term anabolic steroid to establish that the term does not include chorionic gonadotropin when administered by injection for veterinary use by or upon the order of a licensed veterinarian. 

Section 18

Amends GS 90-96, conditional discharge for first offense, to make a technical change to the statutory reference regarding possessing drug paraphernalia prohibited by GS 90-113.22 (possession of drug paraphernalia), to also add possessing drug paraphernalia prohibited by GS 90-113.22A (Possession of marijuana drug paraphernalia), to the offenses that may be conditionally discharged, as specified, under the statute for a first offense. Makes technical changes and makes the language gender neutral. Makes conforming change to subsections (a1) and (e). 

Amends GS 115C-401.2 (student online privacy protection), as enacted by SL 2016-11, to exempt from the definition of targeted advertising the use of covered information to identify nonprofit institutions of higher education or scholarship providers to students. Amends the following permissible operator actions under subsection (e), as enacted by SL 2016-11. Allows an operator to use recommendation engines to recommend to a student additional content relating to an educational, other learning, or employment opportunity purpose within the operator's site, service, or application if the recommendation is not determined in whole or in part by payment or other consideration from a third party, excluding nonprofit institutions of higher education or scholarship providers that are seeking to enroll students who meet specific criteria (previously, did not provide for an exception for nonprofit institutions of higher education or scholarship providers as specified). Allows an operator to respond to a student's request for information or for feedback to help improve learning without the information or response being determined in whole or in part by payment or other consideration from a third party, excluding nonprofit institutions of higher education or scholarship providers seeking to enroll students who meet specific criteria (previously, did not provide for an exception for nonprofit institutions of higher education or scholarship providers as specified).

Section 19

Makes technical change to GS 147-12(b), which requires various departments to annually deliver detailed information on the agency's litter enforcement, litter prevention, and litter removal efforts.

Makes technical changes to GS 147-86.59, concerning the certification required under the Iran Divestment Act. Defines attempts to contract to include contract renewal or assumption. Establishes that, if a State agency and the same person enter into multiple contracts or multiple contract renewals or assumptions within 180 days after a certification is made, a new certification need not be made.

Amends GS 153A-99, concerning county employee political activity, to provide that, for purposes of the statute, a deputy sheriff and an employee of a sheriff are county employees or employees.

Effective October 1, 2016.

Section 20

Repeals SL 2015-52, Section 1, which revised SL 2011-104, Section 2, to require the Department of Health and Human Services to provide information to the Program Evaluation Division (PED) and required PED to report to the Joint Legislative Program Evaluation Oversight Committee and the Joint Legislative Oversight Committee on Health and Human Services on criteria used to determine whether provision of overnight respite services in an adult day car setting is a worthwhile service. 

Section 21

Directs the Revisor of Statutes to have an explanatory comment to be printed to GS 36C-112 prepared by the Estate Planning and Fiduciary law Section of the North Carolina Bar Association, as the Revisor deems appropriate.

Directs the Revisor of Statutes to have all explanatory comments of the drafters of Section 7.1 (trustee's special power to appoint to a second trust), 7.2(b) (recodification of GS 39-35) and (c) (recodification of GS 39-36), 16.4 (amendments of recodified GS 31D-5-505), and 16.5 (crditor's claim against settlor), to be printed as the Revisor deems appropriate.