March 24, 2017
Last Friday, a three-judge panel issued a split decision in the ongoing legal battle between the State’s executive and legislative branches. The panel ruled that the Senate did in fact have the authority to confirm the Governor’s Cabinet appointees. They did however rule against the other two measures being challenged by the Governor. The first of which reduced the number of career status employees serving at-will to the Governor. The other consolidated the powers and duties of the State Board of Elections and the State Ethics Commission, as well as the Secretary of State’s oversight of lobbyists, into a single bipartisan board appointed by both the Governor and the NCGA.
Judges deliver split decision in fight between Cooper, lawmakers – WRAL
The Senate continued the process of confirming more of Gov. Cooper’s cabinet nominees. Secretary Machelle Sanders of the Department of Administration and Secretary Susi Hamilton of the Department of Natural & Cultural Resources received their initial hearings. Sec. Sanders, who is endorsed by the NC Chamber, continued the trend of unanimous support from the Senate. However, the vote on Sec. Hamilton, who was serving her fourth term in the House prior to her appointment, broke that trend as the first Cabinet nominee to receive “no” votes. In the Senate Agriculture/Environment/Natural Resources Committee, three members of the Committee voted against her confirmation, Sen. Andrew Brock (R-Davie), Sen. Trudy Wade (R-Guilford), and Sen. Norm Sanderson (R-Pamlico).
Cabinet pick advances through turbulent confirmation hearing – N&O
The House and Senate overruled Gov. Cooper’s (D) first veto to House Bill 100, entitled Restore Partisan Elections Sup. & Dist. Court, sponsored by Rep. Justin Burr (R-Stanly). The law returns the State to the pre-1996 partisan election of trial judges. The law recognizes the political party affiliation of judges running for district and superior court next to their name on the ballot. A result of reinstating partisan labels would require the Governor to fill judicial vacancies with individuals of the same political party as the judge who vacated the seat, at the recommendation of local party officials. Prior to this law, the Governor had the authority to appoint whomever he or she pleased, as long as the individual was a resident of the geographical district.
Veto override means voters will know judges’ party affiliations – N&O
House Bill 2 was once again in the news. Earlier in the week, Sen. Joel Ford (D-Mecklenburg) filed legislation to repeal the law, mirroring the efforts of a special session last December. The bill would repeal HB2 thirty days after lawmakers adjourn their 2017 session sine die. In December, Gov. Cooper urged Democrats in the House and Senate to oppose the measure, settling for nothing but full repeal. He appears to have changed his views and signaled support for the legislation filed by Sen. Ford. LGBTQ groups are still very much opposed to anything other than full repeal.
Ford files new HB2 repeal bill just shy of law's anniversary – WCNC
Meanwhile, the Speaker announced on Wednesday that the House could have a long day on Thursday and possibly extend into Friday as well. Although that never came to fruition, House Republicans spent a significant portion of Wednesday evening and Thursday morning in caucus discussing a possible HB2 deal. The alleged proposal reportedly would have repealed parts of HB2 and simultaneously enact language similar to the Religious Freedom Restoration Act (RFRA) proposed in Indiana. Speaker Moore (R-Cleveland) told reporters on Thursday that RFRA was not part of the discussion and that he, Sen. Phil Berger (R-Rockingham), Gov. Cooper, and business leaders have been working on a draft and will continue to next week. After caucus Thursday, the Speaker announced that there would not be a Friday session.
Speaker: House in talks with Senate on HB2 replacement – WRAL
‘Conscience protection provision’ possible in new HB2 changes – but not Indiana-like RFRA, Moore says – N&O
NCAA gives North Carolina a deadline to repeal HB2 or lose events until 2022 – Charlotte Observer
Several bills were filed this week dealing with some form of repeal to the State’s Certificate of Need (CON) law. Senate Bill 324, entitled Repeal Certificate of Need Laws, filed by Sen. Ralph Hise (R-Mitchell), is a straight, full repeal of the law. Senate Bill 328, entitled Lower Cost of Cataracts for Seniors Act, filed by Sen. Norm Sanderson (R-Pamlico), specifically exempts ophthalmologists who perform office-based cataract surgery from CON. And Senate Bill 330, entitled Exempt Hospice Inpatient Facilities from CON, was sponsored by Sen. Harry Brown (R-Onslow). Opponents of CON suggest that removing bureaucratic barriers will allow the “free market” to thrive in healthcare. However, advocates of upholding the current law, contend that a free market for healthcare will never exist as long as the government continues to play such a significant role in regulating and funding healthcare. They also contend that removing the law would only further harm rural areas by causing already struggling rural hospitals to close.
Deadlines are beginning to pass regarding the filing of legislation. Senators must file public bills by next Thursday, March 30th. The Senate does not have deadlines for Appropriations/Finance bills. In the House, which has a slightly delayed deadline calendar, local bills must be filed by next Wednesday, March 29th. Non-Appropriation/Finance public bills and resolutions must be submitted to bill drafting by March 30th and filed by April 12th. Public bills that do have an impact on Appropriations or Finance must be submitted to bill drafting by April 6th and filed by April 25th. Crossover currently remains scheduled for April 27th, although that date may change.
In total 149 bills were filed this week, with 77 in the House and 72 in the Senate, bringing the total number of bills filed so far this session to 870. A link to next week’s announced Committee calendar can be found here. A cumulative list of House and Senate bills filed so far this year, links to each bill, and its current status can be found here.
Other legislation filed this week worth noting includes:
House Bill 413 – Limit Legislative Service to 16 Years, filed by Rep. Bert Jones (R-Rockingham), is a proposed Constitutional Amendment to limit the cumulative length of time and individual may serve in the General Assembly to 16 years.
House members give term limits amendment another shot – Carolina Journal
House Bill 435 – Raise Minimum Age to Access Tobacco Products, sponsored by Rep. Greg Murphy (R-Pitt), would raise the age limit for buying tobacco products, tobacco-derived products, vapor products, and cigarette wrapping papers from 18 to 21. The bill has an exception for active duty military personnel.
Bill would make buying tobacco, vaping products in NC illegal if you’re under 21 – N&O
Senate Bill 331 – Military Operations Protection Act of 2017, sponsored by Sen. Harry Brown (R-Onslow), imposes a temporary moratorium on new wind farm permits until the completion of a study to determine if they interfere with military installations concludes.
Bill Calls For Wind Farm-Military Conflict Study – Coastal Review Online
Senate Bill 364 – Brian Garlock Act, sponsored by Sen. Jeff Tarte (R-Mecklenburg), would make it illegal to talk on the phone while driving unless the operator is using hands-free equipment. The bill provides exceptions for emergency situations.
Senate Bill 387 – Limit Session Length, sponsored by Sen. Jay Chaudhuri (D-Wake), would limit “long session” of the General Assembly, which occurs during odd-numbered years, to 135 calendar days. The “short session”, occurring in even-numbered years, would be limited to 60 calendar days. Both sessions would have an optional 10 calendar day extension.
Legislation in the News:
Eye docs push back on NC surgery bill – WRAL
Nurses Make A Full Court Press for Regulatory Changes – NC Health News
Bill would impose $200 for driving slowly in the fast lane – NSJ
House OKs cutting ties with firms that boycott Israel – WRAL
'Ban the Box' bill introduced in NC – WECT
Student athlete safety measure moves forward – WRAL
Partial rewrite of NC criminal gang law clears House – Winston-Salem Journal
House votes to remove helmet requirement for autocycles – WRAL
House considers concealed handguns at schools holding church – N&O
NC House revives bid for autism therapy coverage – WRAL
Bills would expand taxpayer subsidies to film industry – Carolina Journal
First responders protections, benefits proposal clears House committee – WRAL
NC Senate again agrees to school bus cameras to catch motorists – WSOC
Lawmakers trade fire during gun bill debate – WRAL
Senate Tax Plan
The Co-Chairs of the Senate Finance Committee, Sen. Jerry Tillman (R-Randolph), Sen. Andrew Brock (R-Davie), and Sen. Tommy Tucker (R-Union), filed the Senate tax proposal which they touted last week as $1 Billion in tax relief for the middle class. The press release from Senate leadership can be viewed here. Highlights of Senate Bill 325 include:
- Reducing the State personal income tax rate from 5.499% to 5.35%;
- Raising the standard deduction to remove approximately 94,000 people from income tax liability in the State, increasing the share of the income tax burden towards wealthier individuals, without increasing their taxes. The amount of income in the zero-tax-bracket would increase: from $17,500 to $20,000 by 2018 for married filing jointly; from $14,000 to $15,000 for head of household; and from $8,750 to $10,000 for single filings or married filing separately;
- Modifies the mortgage interest deduction which is currently capped at $20,000 to: $22,000 for married filing jointly; $16,500 for head of household; and $11,000 for single filings or married filing separately;
- Modifies the child deduction amount to coincide with adjusted growth income and filing status, scaling from a $2,500 deduction for each dependent in the lowest income bracket, to zero deduction for the highest income bracket;
- Reduces the State’s corporate income tax rate, which is currently 3% to 2.75% in 2018, and to 2.5% in 2019;
- Provides a reduction to the franchise tax for S-Corporations;
Shifts the method of tax collection on some businesses to market-based sourcing. The move benefits North Carolina based businesses by shifting to taxation on a company’s revenues from sales from the State, rather than taxing investments and employment.
In the News
NC Medicaid By the Numbers – 2017 – NC Health News
NC mental health system needs rebuilding – N&O
New dark money group raising big dollars on promise of access to Cooper and his staff – WRAL
Courts must rise to the challenge – Carolina Journal
State employees in NC may see increased health insurance costs in 2018 – N&O
Cooper wants to use lottery money to offer free NC community college tuition – N&O
NC legislators’ wrath prods CMS to pull lesson about a boy in a dress – Charlotte Observer
Patients wait as errors delay new NC mental hospital – N&O
Mandy Cohen: “I’m here to focus on the work.” – NC Health News
Groups lobby to save NC art, music, PE, foreign language teachers – N&O
Cooper restores state worker association benefits and access – N&O
The Nexsen Pruet Public Policy team provides attorneys and clients with a newsletter summarizing the week's activities and conveying the inner workings of the legislative process and state government in Raleigh. Please feel free to pass this along to your clients or other interested parties, email Kdjones@nexsenpruet.com to be added to the list.