Legal Research on Reapportionment and Insurance

    ; amount (or transferring a lesser amount equal to the same amount of new tax
venues produced) and none of the tax increases became law.

The Governor's proposal (H 1215) to increase beer, wine, and liquor taxes
by 502 was trimmed by the House before it passed. The wine tax increase was
completely eliminated, the beer tax was increased by just one cent per 12 ounce
can (producing $8.2 million), and the liquor tax was halved so it will yield only
about $10.7 million. H 1215 stalled in the Senate; its prospects are uncertain
in the fall or 1982 sessions. The vacation home rental sales tax (H 1207) still
is in the House Finance Committee and the mining severance tax (H 1383) was intro-
duced on the seSSion's last day. Prospects for these bills also are uncertain.

Reapportionment. The difficult task of reapportionment faced the legislature
this session. Although reapportionment of the Senate and the House was accomplished
relatively easily, Congressional redistricting stirred a bitter fight that was not
settled until the session's last week.

Both the Senate (S 313; Ch. 821) and House (H 415; Ch. 800) district plans
make few changes even though there have been population shifts in the state since
1970. As a result, the House plan has a 23.6% overall range from the ideal norm
of 48,954 people per House member; one district has 10.6% fewer people than the norm and
another district has almost 13% more than the norm, netting the 23.6% overall range.
The figures‘for Senate districts have a 22.6% overall range, with one district 102
under and another 12.6% over. The highest overall range for state legislative
districts approved by the United States Supreme Court has been 16.4%. However,
changes in the Court's composition since that 1971 case might allow these plans
to withstand constitutional challenge.

The plan finally approved for Congressional redistricting (S 87; Ch. 894) has
an overall range of only 2.72 (the Supreme Court has not permitted as much leeway
with Congressional districts as with legislative districts). The struggle during
the session centered on three main iSSues: (l)_whether counties should be split to
ensure numerical equality among districts; (2) whether Durham County should remain
in the Fourth District with Wake County or be moved to the rural Second District
where it would be the most populous county; and (3) whether Democratic-leaning
counties should be shifted to the Fifth District (where there is an incumbent Democrat)
or to the Sixth District (where a Republican defeated an incumbent Democrat in 1980).

S 87 resolves all three issues. It breaks tradition and splits a county
(Moore) to achieve better numerical equality. Durham County remains in the Fourth
District. And Democratic-leaning c0unties are added to the Fifth District and
Republican-leaning counties to the Sixth.

As a whole the plan appears at the present to strengthen, or at least not
materially harm, the party of each incumbent Congressman.

Insurance. The most appropriate indication of how long the General Assembly
struggled on auto insurance this session is the fact that the key inSurance bill
(H 7) was filed for introduction on the session's first day (January 14) and was
not ratified until its last day (July 10).

H 7 (Ch. 916) changed radically as it worked its way through the legislature.
As enacted, H 7 increases auto insurance costs for all drivers but places most of
the increases on drivers with insurance points resulting from chargeable accidents
or traffic convictions. H 7 replaces the annual 6% cap on auto insurance rate
increases with a cap tied to the Consumer Price Index (now about 12%). Thus everyone
can expect higher rate increases with their next policy. Moreover, H 7 lifts the
cap altogether on rates of insureds who have points and whose policies have been
placed in the Reinsurance Facility. (The Reinsurance Facility exists to provide
auto insurance for those who cannot obtain insurance in the voluntary market.)

H 7 redistribunes the burden of paying surcharges for losses suffered by the
Reinsurance Facility. Under former law, all insureds within and outside the facility
paid surcharges, although insureds within the facility paid an additional surcharge.
H 7 prohibits surcharges on policies of insureds within and outside the facility
who have no points. The effect is to place the burden solely on insureds with
points. They can expect their insurance costs to increase significantly. The pro—
ponents of the new law thought it unfair that insureds without points should have
to pay surcharges, particularly those assigned to the facility who also paid the
facility surcharge. Opponents argued that all insureds in the facility should pay
surcharges, because all of them were bad risks.

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