NCGA Week in Review

It was a busy week for the North Carolina General Assembly as the Senate’sfinal bill filing deadline passed and both chambers work towards thecrossover deadline at the end of the month. Next week, the legislature willtake a short break and no votes will be recorded from Wednesday April 12 ^th through Tuesday April 18^th.

Business & Economic Development

This week, a number of bills impacting business in North Carolina werefiled. Here’s a peek at three bills that intend to maximize the state’seconomic development efforts and bring business to the Tarheel state:

Sponsored by Sens. Harry Brown (R-Onslow), Danny Britt (R-Robeson), andMichael Lee (R-New Hanover),SB 660: Economic Development Incentives Modificationsaims to focus economic development efforts in distressed areas across thestate by changing economic development incentives and other changes withinthe Department of Commerce (Commerce). The bill would:

• Amend the Department of Commerce’s (Commerce) contract policy to favor projects and project location on the basis of providing the greatest relief to communities experiencing chronic economic distress.
• Require all contracts with Commerce to include each company creating new jobs and the location of each project.
• Prohibit Commerce from considering positions of workers with H-1B visas as jobs when contracting with local governments.
• Amend Commerce’s policy to emphasize the Department’s duty to “maximize the return on investment of economic development dollars by selecting projects and project locations on the basis of providing the greatest relief to communities experiencing chronic economic distress.”
• Require Commerce to create improvement plans for each county.
• Revise tier rankings including removing unemployment benchmark adjustments for small counties and Tier 1 areas and an exclusion of prisoners, establishing that designations are only effective for a calendar year and including average unemployment rates, capita per income on county percentage, assessed property value per capita and population growth as benchmarks.

Sponsored by Sens. Rick Gunn (R-Alamance), Rick Horner (R-Wilson) and TomMcInnis (R-Rockingham),SB 591: Site and Building Development Fund would create a fund within Commerce to provide local governments with loansto develop buildings and sites to attract business. If passed, the billwould direct Commerce to develop and maintain a list of potential qualifiedbusiness facilities. The bill also outlines the process for localgovernments to apply for a loan and would base interest rates by tierdesignation – 0% for tier one, 1% for tier two, and 2% for tier threecounties.

Both SB 591 and SB 660 have been referred to the Committee on Rules andOperations of the Senate.

Since 2010, 31 states including the District of Columbia have passedlegislation recognizing benefit corporations (B-corporations), for-profitentities which create a public benefit. Reps. Chuck McGrady (R-Henderson),Josh Dobson (R-McDowell), Stephen Ross (R-Alamance), and Lee Zachary(R-Yadkin) introducedHB 616: North Carolina Public Benefit Corporation Act, which would recognize this type of corporation. The primary benefits ofB-corporations include allowing directors to consider financial andnon-financial interests when making business decisions, attracting talent –especiallymillennials and increased attractiveness to investors and stakeholders. A similar billpassed the state Senate in 2011, and Rep. McGrady introduced identicallegislation in 2015, but the bill failed to pass the crossover deadline. HB616 has not received a committee referral yet.

Additionally, the Senate passed their tax packageSB 325: Billion Dollar Middle Class Tax Cut, in part reducing the personal and corporate income tax and increasing thestandard and child deduction, by a vote of 34-13. The bill will now be sentto the House for consideration. The House and Senate have competing taxpackages, which will likely be worked out in budget negotiations. To readmore about the tax plans being considered by the chambers, clickhere.

Elections

A proposal to constitutionally limit state legislators to two-four yearterms was defeated by a 10-13 vote in the House Committee on Elections andEthics Law on Tuesday. According to bill sponsor Rep. Harry Warren(R-Rowan),HB 193: Legislative Four-Year Terms, the bill would have allowed legislators to focus on legislating, insteadof campaigning. Legislators are currently elected to two-year terms and NCdo not have term limits. Opponents to the bill, including Reps. HenryMichaux (D-Durham) Michael Speciale (R-Craven) argued that frequentelections keep legislators responsive to their constituents and campaignpromises. The bill is also sponsored by Reps. Jon Hardister (R-Guilford),Larry Yarborough (R-Person) and Jay Adams (R-Catawba).

The power struggle between Gov. Cooper and GOP legislators over electionsoversight continued this week as Rep. David Lewis introduced a bill torework a law passed last December which combined elections and ethicsduties into one board and gave the legislature sole appointment power tothat board.SL 2016-125: Bi-Partisan Ethics, Elections & Court Reform, was ruled unconstitutional by a three-judge panel last month. This week,Rep. David Lewis (R-Harnett), unveiled a proposal to rework the law andgive the appointment power to Gov. Cooper while maintaining a bipartisansplit board. Rep. Lewis has said that he hopes this bill puts an end to thelitigation, but Democrats, including the Governor have opposed the bill.SB 68: Bipartisan Bd of Election and Ethics Enforce cleared two committees on Tuesday and was passed largely by party lines,with a vote of 68-42, in the House on Thursday. The bill could potentiallybe assigned to a committee in the Senate before heading to the floor for avote of concurrence. Gov. Cooper has indicated that he will veto SB 68,however, Republican’s maintain a veto-proof supermajority in both chambers.To override a veto, the bill would require the approval of 3/5 of presentmembers in both chambers.

Leadership Changes and Appointments

The House and Senate voted on the nominees for the UNC Board of Governorsthis week. The Board oversees the University of North Carolina’s 16 schoolsystem and the NC School of Science and Math. Due to alaw passed earlier this year reducing the size of the Board, the House andSenate each elected six new members this year. Clickhere to read more about the newly elected members.

Two of Gov. Cooper’s picks for his cabinet received confirmation from theSenate on Thursday. Machelle Sanders was confirmed as Secretary of theDepartment of Administration, and Dr. Mandy Cohen was confirmed to lead theDepartment of Health and Human Services. Still awaiting confirmation areTony Copeland, Secretary of Commerce, Michael Regan, Department ofEnvironmental Quality, and Susi Hamilton, Department of Cultural andNatural Resources, all of whom have received approval from Senatecommittees. The Governor has not yet appointed permanent Secretaries forthe Department of Revenue and the Department of Information Technology.

Protecting Children & Families

Sponsored by Sens. Chad Barefoot (R-Franklin), Jeff Jackson(D-Mecklenburg), and Danny Britt (R-Robeson)SB 600: Britny’s Law: IPV Homicide, named in honor of a NC woman murdered by her boyfriend during a domesticdispute in 2015, would increase the penalties for certain domestic murders.Under current law, prosecutors must prove premeditation to convict someoneof first-degree murder. Sen. Jackson, a former prosecutor in Gastonia,noted that defendants are claiming that the murder occurred in the “heat ofpassion” when there has been a history of domestic violence in therelationship. SB 600 would add a list of domestic crimes to the statutethat outlines premeditation. The bill has been referred the Committee onRules and Operations of the Senate.

Sponsored by Reps. Sarah Stevens (R-Surry), David Lewis (R-Harnett), NelsonDollar (R-Wake) and Jonathan Jordan (R-Ashe) and Sens. Tamara Barringer(R-Wake), Kathy Harrington (R-Gaston) and Tommy Tucker (R-Union)SB 594 /HB 608: Family/ Child Protection & Accountability Act aims to improve NC’s child welfare system by making a number reforms,including:

• Directs DHHS to consolidate the state’s social services departments. There is currently a department in each of the state’s 100 counties, the bill directs DHHS to consolidate that to 30 regional departments by 2022.
• Directs DHHS and the Office of State Budget and Management to consult with an outside organization to evaluate the state’s child welfare system and develop a plan to reform the system.
• Implements a pilot program to waive a current requirement that foster parents maintain employment outside of their work as a foster parent if the home is utilizing Intensive Alternative Family Treatment (IAFT). IAFT is used when a child suffers from mental health issues and therefore requires a higher level of care.
• Shortens the timeframe that parents have to appeal permanency plans from 180 to 65 days.

The House version of the bill has not received committee referral yet, andthe Senate version has been sent to the Senate Appropriations/ Base BudgetCommittee.

Road Safety

While the risks of texting while driving are generally universallyaccepted,HB 558: Study/ Texting While Driving Enforcement seeks to study how to improve enforcement of state laws that prohibit cellphone use while driving. The bill, sponsored by Reps. Stephen Ross(R-Alamance), John Faircloth (R-Guilford), Jon Hardister (R-Guilford) andAllen McNeill (R-Randolph), would direct the Department of Justice toreport:

• The number of charges, convictions and dismissals for the state’s laws pertaining to cell phone use while driving.
• The issues preventing enforcement and prosecution of those laws.
• A survey of how other states address the unlawful use of a cell phone while driving.
• New technologies that cause driver distraction and are not currently included in state law.
• Resources that would aid law enforcement and the courts in addressing issues in the enforcement and prosecution of these laws.

The bill has been sent to the House Committee on Judiciary II.