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NC Legislative Update: November 1, 2019

November 1, 2019

Both the House and Senate adjourned until November 13, 2019, after attempting to wrap up business for the year this week. The adjournment resolution specifies that the legislature can address redistricting matters, appointments, nominations, conference reports, and another adjournment resolution in their November session. The resolution also specifies that the legislature will return to Raleigh for session on January 14, 2020 to address the same issues as allowed in November, plus veto overrides, funding for the Department of Transportation (DOT), bills addressing access to health care, and budget modifications.

When legislators return in November, they will be redrawing congressional districts, after a three judge panel recently entered a ruling indicating that the State needs to redraw the maps based on a similar ruling over a partisan gerrymandering of the state legislative districts. The judges’ order granted an injunction to halt the 2020 primaries as a result of the case. The same three judge panel also approved the legislature’s recent redraw of the state legislative maps.

Washington Post: https://www.washingtonpost.com/politics/state-court-blocks-current-house-districts-in-north-carolina-for-2020-elections/2019/10/28/cd9e8b5a-f9dc-11e9-8190-6be4deb56e01_story.html

The legislature passed a bill to increase teacher pay this week, but the bill was not without controversy. Senate Bill 354 would give teachers the 3.9% over two years raise that they would have received under the vetoed budget, plus an additional raise to make the increase 4.4% over two years if the budget veto override is successful. Democrats are calling this a political ploy, and no Senate Democrats voted for the bill and only three Democrats voted for the bill in the House.

WRAL: https://www.wral.com/republicans-pitch-new-teacher-raises-but-with-a-catch-in-budget-fight/18733666/

One bill held up this week was the Storm Recovery Act of 2019, which contains appropriations to aid in the recovery of Hurricane Dorian and other recent named Hurricanes. The bill passed the House with around $280 million for various programs. The Senate has been advancing a drastically paired down version of the bill, only containing $150 million in appropriations. The Senate removed much of the storm preparation money and stuck to traditional aid programs. The bill is now in conference and will be an eligible topic when legislators return in a few weeks.

WRAL: https://www.wral.com/house-passes-280m-disaster-recovery-bill/18732886/

Senate Veto Override Calendar

Speculation of a veto override vote started last Friday when the Senate added the veto override of House Bill 966, the budget, to Monday’s calendar. The Senate Rules require that the majority party notice the vote at least 24 hours prior to holding it. However, Senate leadership ended up pulling the bill from the calendar, and placing it on the next day’s calendar. They would ultimately end up placing three veto override bills (budget, Medicaid Transformation, and Regulatory Reform) on the calendar daily, only to remove them and place them on the next day’s calendar. No veto override votes were taken this week, indicating that the Republicans do not currently have the votes necessary to override. The State Constitution requires a three-fifths majority vote of the members voting and present to override a veto. Republicans currently hold 29 of 50 seats in the Senate, meaning that they would need one Democrat to vote with them or two Democrats to be absent to override if all 29 Republicans were present. The adjournment resolution that calls the General Assembly back to Raleigh in November does not list veto overrides as one of the allowable topics, but does include veto overrides in the January session. 

WRAL: https://www.wral.com/state-senate-delays-weighs-budget-veto-override/18729376/

NC Farm Act Controversy

The House and Senate reached a compromise on the North Carolina Farm Act of 2019 last week, but that compromise quickly fell apart this week. The two chambers had been at odds for months over a ban on smokable hemp. With some arguing that allowing smokable hemp would essentially be a backdoor way to legalize marijuana, since the two plants look and smell similar, making it hard to differentiate between the two. While others contended that banning smokable hemp will severely affect farmers’ ability to market the crop, since the smokable products are one of the most profitable uses of the plant. The two sides reached a compromise last week in conference and agreed on a smokable hemp ban that will start on June 1, 2020, with a study to take place in the intermittent time.

However, another section of the bill that has gotten less attention caused the House to pull the conference report from Monday’s calendar, after the Senate had already adopted it. Section 20 of the bill adds hunting, fishing, shooting sports, and equestrian activities to the list of actions that quality as agritourism on a bona fide farm. The agritourism statutes exempt farm operations from local zoning ordinances and building regulations, and have traditionally been used to allow for wedding venues and other similar uses on farms. Some House members have concerns over adding shooting ranges to the definition, and requested a provision be added to ensure that the shooting ranges comply with local regulations. Supporters of the provision claim that this undermines the intent of the language. It is unclear what the path forward will be, since the Senate has already voted to accept the conference report. 

WRAL: https://www.wral.com/well-shoot-nc-farm-act-not-quite-done/18731201/

Finance Bills

The General Assembly passed two finance bills this week that largely include provisions included in the vetoed budget. Senate Bill 557 and Senate Bill 578 are both on the Governor’s desk.

Senate Bill 557 increases the standard deduction for married filing jointly from $20,000 to $21,000, and from $10,000 to $10,750 for those filing single. The bill also clarifies the definition of a holding company for franchise tax implementation. It establishes market-based sourcing for companies calculating their sales factor for multistate apportionment, and requires marketplace facilitators to collect and remit sales tax for third-party-sellers. The bill had a hiccup in the House Finance Committee when Representative Adcock successfully amended the bill to add a tax increase on vaping products, claiming that she wanted to make the tax comparable to the tax on cigarettes. The amendment was later removed in another committee, and, when she tried to run a similar amendment on the House floor, it was ruled out of order. The bill passed both chambers with large, bipartisan support.

Senate Bill 578 reduces the franchise tax rate from $1.50 to $0.96 per $1,000 of tax value over two years. The rate will be $1.29 in 2021 and $0.96 in 2022. Electric utility companies will continue to pay the $1.50 rate until 2027. The bill also reduces the qualifying expense threshold for awards from the Film and Entertainment Grant Fund. This section also specifies that the grant is a binding agreement and not subject to appropriations by the General Assembly. This bill also ran into problems in the House Finance Committee after failing to receive a favorable report. The bill was moved to the House Rules Committee where it was approved and sent to the floor. The bill received criticism from some Republicans, who do not like the film grant, and many Democrats who feared that the franchise tax cuts would reduce the funds available for other government priorities, like education and state employee pay raises. The bill was approved on largely party lines in both chambers.

WRAL: https://www.wral.com/house-leadership-undoes-vaping-tax-proposal-resurrects-business-tax-cut/18732938/
 

Medicaid Transformation Readiness Hearing

The House Health Committee held a meeting last week to hear from the NC Department of Health and Human Services (DHHS), NC Healthcare Association (NCHA), and the NC Medical Society on the state’s move to managed care Medicaid, known as Medicaid Transformation. DHHS Secretary Mandy Cohen noted slow sign-ups and the budget stalemate as challenges to meeting the February 2020 implementation date, but still insisted that the Department would be ready if they had a budget by November 15. The provider community seemed less optimistic that the February 2020 date was feasible, as they noted slow patient sign-ups, credentialing issues, and a lack of provider contracts in place. Without provider contracts in place, many Medicaid beneficiaries will not be able to select their doctor when enrolling, and credentialing issues will affect reimbursements. Lawmakers also expressed concern with the Department’s aggressive timeline, with Republicans and Democrats both talking of delaying the implementation until July 2020.

NC Health News: https://www.northcarolinahealthnews.org/2019/10/24/march-to-medicaid-managed-care-switch-looking-rocky/

2019 Session Laws

The following 238 bills have become law this session:

  1. SB 7: Bipartisan Ethics Appointments
  2. SB 75: Restore Ct. of Appeals Membership
  3. SB 77: Ag Disaster Fund/Certain Counties
  4. SB 214: Ensure Orderly 2019 Elections
  5. SB 12: Fill Certain Vacancies/Alexander & Burke Co.
  6. SB 56: Revenue Laws Technical Changes
  7. SB 4: Extend Terms of 2 Members/Coastal Carolina CC
  8. SB 272: Zoning for University Facilities-Durham
  9. SB 6: Dare County/CC Construction Funds
  10. SB 162: Loan Origination/Late Payment Charge Changes
  11. HB 263: Fill Vacancies/Modify 2018 Appointments
  12. SB 63: City of Kannapolis/Annexation
  13. HB 130: Allow Game Nights
  14. SB 505: Rural Job Retention Act
  15. SB 605: Highway Storm Recovery Act
  16. HB 1014: 2020 Census VTD Verification Program
  17. SB 310: Electric Co-Op Rural Broadband Services
  18. HB 363: Craft Beer Distribution & Modernization Act
  19. HB 233: State Auditor/Local Finance Officer Amends
  20. HB 532: DNCR Add New Trails & Various Changes
  21. HB 388: Immunizing Pharmacists
  22. HB 646: ID Approval/Flex Muni One-Stop
  23. HB 70: Delay NC HealthConnex for Certain Providers
  24. HB 9: Bessemer City Charter Amendment
  25. HB 201: Randolph Co. Register of Deeds Tax Cert
  26. SB 252: Dental Bill of Rights
  27. SB 138: Even-Yr Municipal Elections/Town of Black Mtn.
  28. SB 139: Even-Yr. Municipal Elections/Town of Montreat
  29. HB 336: Extend Suspension of Spencer Mountain
  30. SB 235: Franklin/Nash Municipalities/Unfit Dwellings
  31. SB 30 Stanly CC/Contracting Date Extension
  32. SB 381: Reconstitute/Clarify Boards and Commissions
  33. HB 301: CIP Revisions/Juvenile Code
  34. HB 179: Mini-Truck Classification
  35. HB 131: Repeal Map Act
  36. HB 82: Railroad Crossings/On-Track Equipment
  37. SB 648: Support Shellfish Aquaculture
  38. SB 448: Amend Appt For Compact on Education/Military
  39. SB 255: State Board Construction Contract Claim
  40. SB 151: Break or Enter Pharmacy/Increase Penalty
  41. HB 617: Allow Repeat Referral to Teen Court
  42. HB 578: Modify Legitimations Provisions
  43. HB 548: Modify Physical Therapy Definition
  44. HB 383: Topsail Beach Charter/Board Vacancies
  45. HB 1016: UNC Boards of Trustees Appointments
  46. HB 1017: Special Master Wake House Plan
  47. HB 415: Photos of Juveniles/Show-Ups
  48. SB 148: Public Records/Release of LEO Recordings
  49. SB 11: ABC Regulation and Reform
  50. SB 466: EDPNC Modifications
  51. HB 57: Create Term for Public Schs. & Codify NCVPS
  52. HB 389: ABC/Univ Athletic Facility
  53. HB 531: Tenants at Foreclosure Act Restored
  54. HB 658: Allow Donations of Unexpired Drugs
  55. HB 664: myFutureNC/Postsecondary Attainment Goal
  56. HB 432: Water/Sewer to Contiguous Dwelling Units
  57. HB 219: NAIC Accreditation Amendments.-AB
  58. SB 80: China Grove Satellite Annexation
  59. SB 242: Recreational Land Fee Changes
  60. SB 227: TP3/Principal Fellows Consolidation
  61. SB 84: Walkertown Zoning Authorizations
  62. SB 262: Union/Prohibit Certain Hunting Acts
  63. SB 674: Surry Co./Mt. Airy/Elkin City/Bd. Ed Partisan
  64. HB 15: Lexington/Dissolve Utilities Commission
  65. HB 240: Albemarle/City Labor for Business Ctr
  66. HB 299: Henderson City/Build Community College Bldgs
  67. HB 6: Burlington Airport/Lease/Contract Authority
  68. SB 225: Repeal Tuition Surcharge
  69. HB 537: Hwy Use Tax Vehicle Subscriptions
  70. HB 934: Right to Try Adult Stem Cell Treatments
  71. SB 219: Modify Teacher Licensing Requirements
  72. SB 55: Continuing Education for General Contractors
  73. SB 483: Vacation Rental Act Changes
  74. SB 610: Authorize Northern Peaks Trail
  75. SB 95: Veterans Memorial Funds/Do Not Revert
  76. SB 556: GSC People First Language 2019
  77. SB 529: Fees/Returned Checks
  78. SB 88: Electrician Requirements for Certain Orgs
  79. SB 313: Guar. to Streamline Afford. Housing
  80. SB 127: Protect Governmental Accountability
  81. HB 656: Medicaid Changes for Transformation
  82. HB 924: Teacher Contract Changes
  83. HB 474: Death by Distribution
  84. HB 67: Road Barrier Prohibition
  85. HB 310: Clarify Insurance Prod'r Crim. Bckgrd Check
  86. HB 812: Nutrient Offset Amendments
  87. HB 886: Study Participation of Operators in NC Pre-K
  88. HB 529: Utilities/Water and Wastewater Consumption
  89. HB 917: Emergency Declaration/Clarify Rd Closure
  90. HB 747: NC Missing Person Information Sharing
  91. HB 770: Freedom to Work/OLB Reform
  92. HB 871: Fair Contracts
  93. HB 4: Claremont Deannexation
  94. HB 52: Wrightsville Beach Local Act Amendment
  95. HB 204: Town of Beaufort/Annexation
  96. HB 349: Wilkes County Fire Tax-Procedure
  97. HB 489: Lincolnton-Lincoln County Airport Authority
  98. HB 80: Roanoke Rapids Lake/Unattended Equip
  99. HB 237: Brunswick County Zoning Procedure Changes
  100. HB 368: Bermuda Run/Speed Restrictions
  101. HB 98: Macon/Clay/No Right-of-Way Spotlighting
  102. HB 134: Filling Vacancy/Onslow County Board of Comm
  103. HB 170: Various Satellite Annexations
  104. HB 187: Amend Town of Elon Charter/Parking Ordinances
  105. HB 285: City of Sanford/Town of Beaufort/Vol Annex
  106. HB 239: Pitt County Animal Control Records
  107. HB 324: Local Hunting Omnibus
  108. HB 429: Navigable Waters/Manteo/Hyde
  109. SB 191: Out-of-State Law Enforcement/2020 Rep Convtn
  110. SB 399: Rehire High-Need Teachers
  111. SB 355: Land-Use Regulatory Changes
  112. SB 378: Local Economic Development Modifications
  113. SB 394: Changes to Estates & Trusts Statutes
  114. SB 311: Massage Board Membership
  115. HB 257: Motorcycles/Face Masks
  116. HB 224: Assault w/ Firearm on LEO/Increase Punishment
  117. SB 594: Register of Deeds Updates
  118. SB 525: Textile Hist. Site/Operate SE NC Museum
  119. SB 220: Removal of Political Signs by Citizens
  120. SB 500: Modify Advanced Math Course Enrollment
  121. SB 186: Beaufort-Morehead Cty Airport Authority/Amend
  122. SB 686: Appointments Bill 2019
  123. HB 492: Simplify Builder Inventory Exclusion
  124. HB 402: UNC Capital Projects
  125. SB 384: Clarify Motor Vehicle Dealer Laws
  126. HB 761: Clarify Wastewater Permitting Liability
  127. HB 758: MSD Expansion and Governance/DACS Study
  128. HB 755: Travel Insurance Amendments
  129. HB 735: Adopt Rules Incorporating 2017 Food Code
  130. HB 629: Law Enforcement Mutual Aid
  131. HB 495: No Municipal Reg/Off-Site Wastewater Systems
  132. HB 329: Renewable Energy Amends
  133. HB 156: Swain County Settlement Trust Fund
  134. HB 138: Damage Jail & Prison Fire Sprinkler/Penalty
  135. HB 106: Inmate Health Care & 340B Program
  136. HB 18: Allow Absentee Ballots/Fire District Election
  137. HB 757: Pender County/Butner Property Transfers
  138. SB 535: Authorize State Park/Clarify Corps Name
  139. HB 668: Various Higher Education Changes
  140. HB 590: Amend Administrative Procedure Laws
  141. SB 444: Allow Use of Oyster Shells As Serving Dishes
  142. HB 411: Modify School Qual./Student Success Indicator
  143. SB 210: Organ & Tissue Donation/Heart Heroes
  144. SB 316: Affordable Housing
  145. SB 297: Cancer Research Advisory Panel
  146. SB 462: Modifications to NC Appraisal Board
  147. SB 508: Civil Procedure/Deponent Declaration
  148. SB 606: Prioritize Native NC Plants on Highway ROW
  149. HB 107: PED Oversight/EPP Changes
  150. HB 323: Assess Costs of Local LEO Crime Lab Analysis
  151. HB 268: Amend On-Site Wastewater Laws/Misc. TC
  152. HB 243: State Human Resources Act Amendments.-AB
  153. HB 337: Change Salvage Vehicle Transfer Requirements
  154. HB 362: 15-Point Scale For School Performance Grades
  155. HB 546: Prohibit Counterfeit/Nonfunctional Airbags
  156. HB 620: Street Database/Manual/Public Record Except
  157. SB 29: Move Over Law/Increase Penalties/Amber Lights
  158. HB 198: Human Trafficking Commission Recommendations.-AB
  159. HB 325: Opioid Epidemic Response Act
  160. SB 194: West Jefferson/Saluda Satellite Annexations
  161. SB 420: NC Servicemembers Civil Relief Act
  162. SB 218: Clarify State Recognition - Lumbee Indians
  163. SB 145: Allow Sports/Horse Race Wagering Tribal Lands
  164. SB 332: Civil Procedure/Limitations/Land Surveyors
  165. SB 343: Various Education Law Changes
  166. SB 391: Expand Youth Internship Opportunities
  167. SB 478: Modify Appointment Reporting
  168. SB 493: DVPO Abuser Treatment/Time of Expiration
  169. SB 523: Laws Clarifying & Administrative Changes
  170. SB 604: Amend NC Veterinary Practice Act
  171. SB 108: PED/Safekeeper Health Care Cost Recov. Pract
  172. HB 469: Various Family Law Changes
  173. HB 628: 2019 Banking & Mortgage Corrections & Changes
  174. HB 675: 2019 Building Code Regulatory Reform
  175. HB 50: Allow Hyperbaric Oxygen Therapy for TBI/PTSD
  176. HB 922: Enhance Insurance Coverage/Educ. Buildings
  177. HB 264: GSC Technical Corrections 2019
  178. SB 532: Amends Probate/Trusts/Wills Choice of Law
  179. HB 220: Insurance Technical Changes.-AB
  180. SB 302: Update ACH Svc & Care Plan/Bd of Nursing
  181. SB 385: Clarify/Auto Dealers Regulatory Req
  182. SB 290: ABC Regulatory Reform Bill
  183. SB 9: Female Genital Mutilation/Clarify Prohibition
  184. SB 301: Regional School Modifications
  185. SB 366: 9th/10th Grade/College Transfer Pathways
  186. SB 413: Raise the Age Modifications
  187. SB 498: Facilitate Response to Disasters
  188. HB 724: Truth in Caller ID Act
  189. HB 872: Underground Utility Safety Act/Changes
  190. SB 190: Expand Special Assessments for Dam Repair
  191. HB 228: Modernize Laws Pertaining to NC Medical Board.-AB
  192. HB 961: Ensuring Authorization of Federal Funds
  193. HB 760: Expand Loss Prevention Investigations
  194. HB 391: Passenger Protection Act
  195. HB 590: Modify Continuing Ed for Real Estate Brokers
  196. SB 321: Federal Motor Carrier Safety/PRISM
  197. SB 68: Relocation of Water/Sewer Line Costs
  198. SB 584: Criminal Law Reform
  199. HB 206: Various Transportation Changes
  200. HB 217: DIT Changes.-AB
  201. SB 230: NC Military and Veteran Act of 2019
  202. SB 86: Small Business Health Care Act
  203. HB 99: Transfer ALE/Move Boxing Advisory Commission
  204. HB 597: Wildlife Resources Commission Amends
  205. HB 604: Small Business Retirement Program
  206. HB 55: Cleveland County/Sheriff Vacancies
  207. HB 554: Funeral Practice Licensure Tech. Corrections
  208. HB 609: Salary Increases/Adult Correctional Employees
  209. HB 226: Pay Increases/State Employees
  210. HB 126: Pay Increases/State Highway Patrol
  211. HB 777: Pay Increases/SBI & ALE
  212. SB 621: Testing Reduction Act of 2019
  213. HB 449: Handicapped & Special Registration Plates
  214. SB 600: Vets Children/Short-Term Workforce Training
  215. SB 353: Amend Cartway Path/Septic Tank Laws
  216. SB 682: Implement Crime Victim Rights Amendment
  217. SB 574: Study Establish Gaming Comm/Sports Betting
  218. SB 270: Durham Deannexation
  219. SB 692: 2019 Senate Consensus Nonpartisan Map
  220. HB 1020: 2019 House Remedial Map
  221. HB 29: Standing Up for Rape Victims Act of 2019
  222. HB 75: School Safety Funds, Programs, and Reports
  223. SB 118: Prison Safety/TANF State Plan/Clarifications
  224. SB 429: Disaster Recovery - 2019 Budget Provisions
  225. SB 458: PTS Day/Cardiac Task Force/Titus's Law/Data
  226. SB 691: Emergency Operating Funds for Utilities
  227. HB 211: Various DMV Changes
  228. HB 283: Conner’s Law
  229. HB 1001: Raise the Age Funding
  230. HB 387: Growing G.R.E.A.T.
  231. HB 100: DOT Budget for 2019-2021 Biennium
  232. SB 572: University System Risk Management Provisions
  233. SB 690: Modifications to 2019 Appointments Bill
  234. HB 181: Yanceyville/Greensboro/McDowell Cty Bd Ed.
  235. SB 61: Community Colleges Budget/2019-2021 Biennium
  236. SB 579: Prison Reform Act of 2019
  237. HB 399: Extend Tax Credits/Other Finance Changes
  238. SB 312: Relief to Ocracoke School/Hurricane Dorian


More about Nexsen Pruet's North Carolina Public Policy Team
In addition to providing Government Affairs Services, 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 during the legislative session. Please feel free to pass this along to your clients or other interested parties. If you would like to receive the update in your inbox, please email shernandez@nexsenpruet.com to be added to the list. If you are interested in learning more about how Nexsen Pruet can help you achieve your public policy goals and acquiring legislative representation in North Carolina or South Carolina, please reach out to Sandy Sands at ssands@nexsenpruet.com or Ross Barnhardt at rbarnhardt@nexsenpruet.com.

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