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COMMITTEE REPORT
May 9, 2001
H. 3595
Introduced by Reps. Thompson, A. Young, Hinson, Law, Limehouse, Littlejohn, Meacham-Richardson, Sandifer and White
S. Printed 5/9/01--H.
Read the first time February 15, 2001.
To whom was referred a Bill (H. 3595) to amend Chapter 2, Title 37, Code of Laws of South Carolina, 1976, relating to limitations on agreements and practices in connection with consumer credit sales and Chapter 3, Title 37, relating to limitations on consumer loan agreements, etc., respectfully
That they have duly and carefully considered the same and recommend that the same do pass with amendment:
Amend the bill, as and if amended, by striking all after the enacting words and inserting:
/ SECTION 1. Chapter 103 of Title 59 of the 1976 Code is amended by adding:
"Section 59-103-200. (A) A public institution of higher learning, as defined in Section 59-103-5, in this State must develop, maintain, and enforce a creditor-marketing policy regulating the distribution of applications, promotion, marketing, and other forms of solicitation for ownership of a credit card by a credit card marketer on its campus. This creditor-marketing policy must be filed with the South Carolina Commission on Higher Education. The Commission on Higher Education must maintain a master file of all creditor-marketing policies and make the information available for public inspection.
(B) In preparing and adopting the policy, the board of trustees or its designee must consider, but is not limited to, considering:
(1) registering on-campus credit card marketers;
(2) limiting credit card marketers to specific designated college campus sites;
(3) providing a credit card debt education brochure with each campus bookstore purchase;
(4) developing a credit card debt education presentation as a part of orientation programs offered to new students; and
(5) prohibiting credit card marketers from offering gifts to students in exchange for completing a credit card application unless the student has been given a credit card debt education brochure.
(C) A public institution of higher learning in this State, as described in Section 59-103-5, that has not adopted the policy required in subsection (A) may not allow a credit card marketer to distribute applications or promotional or marketing materials, or otherwise solicit for ownership of a credit card on its campus, and a credit card marketer is prohibited from distributing applications or promotional or marketing materials, or otherwise soliciting for ownership of a credit card on the campus of a public institution of higher learning in this State that has not adopted the policy required in subsection (A).
(D) This section does not apply to:
(1) solicitation by a financial institution or credit union physically located on a campus wherein normal banking activities are conducted if the solicitation takes place within its office;
(2) solicitations by mail, e-mail, or telephone; or
(3) contracts between institutions and creditors in existence on the date of this act."
SECTION 2. This act takes effect on the first day of the third month following approval by the Governor. /
Amend title to conform.
HARRY F. CATO for Committee.
$0 (No additional expenditures or savings are expected)
EXPLANATION OF IMPACT:
The Commission on Higher Education has reviewed this amendment and indicated that passage may have a minimal impact on the public institutions of this state, but indicates the costs could be absorbed within existing resources. There would be no impact on federal and/or other funds.
Approved By:
Don Addy
Office of State Budget
TO AMEND CHAPTER 2, TITLE 37, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO LIMITATIONS ON AGREEMENTS AND PRACTICES IN CONNECTION WITH CONSUMER CREDIT SALES AND CHAPTER 3, TITLE 37, RELATING TO LIMITATIONS ON CONSUMER LOAN AGREEMENTS, BY ADDING SECTIONS 37-2-418 AND 37-3-418, BOTH SO AS TO PROVIDE FOR SPECIFIC RESTRICTIONS ON THE DISTRIBUTION OF APPLICATIONS AND ADVERTISING AND ANY OTHER FORM OF SOLICITATION FOR OWNERSHIP OF A SELLER CREDIT CARD OR A LENDER CREDIT CARD BY A CREDIT CARD ISSUER ON THE CAMPUS OF A PUBLIC INSTITUTION OF HIGHER LEARNING IN THE STATE.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Chapter 2, Title 37 of the 1976 Code is amended by adding:
"Section 37-2-418. A credit card issuer may distribute applications and advertising and other forms of solicitation for ownership of a seller credit card on the campus of a public institution of higher learning in the State only if the distribution and solicitation:
(1) is undertaken by an employee of the issuer, and not by an independent contractor;
(2) takes place only once each academic year;
(3) is limited to one central location on the campus;
(4) does not include the offer of promotional items in connection with application for ownership;
(5) provides written information on the risks of accumulated credit card debt with each application for ownership and presents that information and other disclosures in conspicuous boldface type, at least as large as the largest typeface otherwise used in the solicitation and application documents;
(6) limits the credit line to five hundred dollars or twenty percent of the annual gross income of the applicant in the most recently completed income tax year, whichever is greater;
(7) refuses acceptance of an account application from an applicant without an annual gross income who already has a credit card account pursuant to an open-end consumer credit plan; and
(8) requires the cosignature of the parent or guardian of an applicant who has no annual gross income."
SECTION 2. Chapter 3, Title 37 of the 1976 Code is amended by adding:
"Section 37-3-418. A credit card issuer may distribute applications and advertising and other forms of solicitation for ownership of a lender credit card on the campus of a public institution of higher learning in the State only if the distribution and solicitation:
(1) is undertaken by an employee of the issuer, and not by an independent contractor;
(2) takes place only once each academic year;
(3) is limited to one central location on the campus;
(4) does not include the offer of promotional items in connection with application for ownership;
(5) provides written information on the risks of accumulated credit card debt with each application for ownership and presents that information and other disclosures in conspicuous boldface type, at least as large as the largest typeface otherwise used in the solicitation and application documents;
(6) limits the credit line to five hundred dollars or twenty percent of the annual gross income of the applicant in the most recently completed income tax year, whichever is greater;
(7) refuses acceptance of an account application from an applicant without an annual gross income who already has a credit card account pursuant to an open-end consumer credit plan; and
(8) requires the cosignature of the parent or guardian of an applicant who has no annual gross income."
SECTION 3. This act takes effect upon approval by the Governor.
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