September 30, 2019

NC Legislative Update: September 2019 #3

David Ferrell, Michelle Frazier, George Smith, III

Maynard Nexsen

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Legislators continued their fall break, with no votes or committee meetings held this week. Lawmakers plan to return to Raleigh next week, where it is expected that we will get more information on the Senate’s plans for taking up a vote on the budget veto override, and potentially a plan to wrap up major policy items for the year. Legislators are still waiting for the three judge panel that invalidated their current legislative districts to rule on their redrawn maps.

Speaker and Minority Leader Clash Over Veto Override

In a press conference this week, House Minority Leader Darren Jackson claimed that he has been lied to by Republicans, who are being dishonest in their accounts of what happened leading up to the September 11 budget veto override vote. Democrats have called the move a “sneak attack”. They claim that they were told that no votes would be taken at a scheduled 8:30 AM session, meaning that their attendance was not needed. This led to the veto being overridden 55 to 15. House leadership has insisted that no message informing the members of no votes at the 8:30 AM session was disseminated. Representative Jackson claims that the vote was a deliberate effort to deceive Democrats, and, given the conflicting stories between Republicans and Democrats, he has called on Speaker Moore, House Rules Chairman Lewis, Representative Saine, and Representative Hardister to all take a polygraph test to judge if they’re lying. Speaker Moore called this a “sideshow” and dismissed the call for lie detector tests as a “publicity stunt.” Moore insisted that the vote was properly noticed and that no announcement of a non-voting session was given. Representative Jackson further raised concerns that the vote was not properly noticed, and mentioned that legal action may be in store. His concerns stem from what is called the “veto garage,” where a motion to consider a veto override is placed on the legislative calendar every day until member absences give the majority party the three-fifths vote margin required to override. The motion to consider the veto override had appeared on the House calendar for around 60 days prior to the vote.

WRAL: https://www.wral.com/dem-gop-leaders-spar-over-call-for-lie-detector-test-on-veto-override-vote/18652990/

Blue Cross Blue Shield NC CEO Arrested

News surrounding the June 22, 2019 arrest of Blue Cross Blue Shield North Carolina (BCBS NC) CEO Patrick Conway surfaced this week. Conway was charged with driving while impaired (DWI) and misdemeanor child abuse. Cell phone footage shows Conway’s vehicle speeding down the interstate, swerving erratically, before colliding with a tractor-trailer truck. According to a police report, once arrested, Conway refused a breathalyzer test, and then petitioned the officers to let him go, and even threatened to call the Governor if not released. BCBS NC, the largest provider of health insurance in the State, originally stood by Conway, but after State Insurance Commissioner Mike Causey called on them to replace Conway and install a new interim CEO, the BCBS NC Board asked for his resignation. Causey called the incident evidence of a “significant breakdown in the corporate governance at Blue Cross.” Causey was also troubled that the BCBS NC Board did not report the incident to him for months, and then downplayed what happened when doing so. BCBS NC has named their COO, Gerald Petkau as the interim CEO. Conway is set to appear in court on October 8.

WRAL: https://www.wral.com/north-carolina-blue-cross-ceo-resigns-after-dwi-charge/18659002/

Alcohol Legislation Update

This legislative session has seen numerous laws enacted affecting alcohol sales. Below are several bills with short summaries.

House Bill 389 allows public colleges and universities to allow alcohol sales at their athletic stadiums and events if their board of trustees approves it.
Senate Bill 11 strengthens the ABC Commission’s power to enforce alcohol laws and increases the Commission’s oversight authority for permit holders.
Senate Bill 290 allows distillery permit holders to obtain onsite permits for consumption, allows ABC stores to do special orders, remove restrictions on distilleries for selling alcohol for off-premises consumption, allows distilleries to issue purchase transportation permits to allow individuals to transport large quantities of alcohol, allows liquor tastings at ABC stores, allows retail permit holders to sell private label brands, spells out that a contract brewery is responsible for all aspects associated with manufacturing the product, allows beverage tastings at farmers markets, allows holders of on-premises and off-premises permits to transfer those permits to other establishments owned by the permit holder, increases the allowed discount on beer and wine from 25% to 35%, defines "premises" to include all areas inside or outside of a location that are under control of the permittee, authorizes the sale of more than one drink at a time at certain locations, allows alcohol consumption at bingo games, exempt breweries that do not serve food from food safety codes, limits the creation of new ABC boards, requires ABC boards to accept electronic payments from permit holders, allows alcohol consumption in the common area of a multi-tenant establishment, creates a delivery service permit, allows breweries to sell beverages in areas regardless of a malt beverage election, repeals the purchase-transportation permit requirement when transporting to a mixed beverage permittee, requires the ABC Commission to make quarterly reports to the legislature, allows ABC boards to use employees or contracted employees to deliver spirituous liquor purchased by a mixed beverage permittee, and directs the Program Evaluation Division (PED) to study the actions of the ABC Commission for violations of the law.
House Bill 363 allows breweries that sell less than 100,000 barrels to self-distribute up to 50,000 barrels to unaffiliated businesses.
House Bill 130 allows nonprofit organizations and trade associations to hold “game nights” where alcohol is served.

Bishop and Murphy Replacements Named

Local county delegations have met to select replacements for two former state legislators who recently won special congressional elections. Former NC House member Rob Bryan will replace Dan Bishop in the State Senate, and Dr. Perrin Jones will replace Dr. Greg Murphy in the State House. Both will have to be formerly appointed by Governor Cooper, who gets ten days to act.

Charlotte Observer: https://www.charlotteobserver.com/news/politics-government/article235503112.html

WITN: https://www.witn.com/content/news/Pitt-County-Republican-Party-elects-Dr-Perrin-Jones-to-fill-seat-of-Congressman-Greg-Murphy-561179681.html

2019 Session Laws

The following 226 bills have become law this session:

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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Maynard Nexsen

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David Ferrell

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Michelle Frazier

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George Smith, III

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NC Legislative Update: September 2019 #3

Speaker and Minority Leader Clash Over Veto Override

Blue Cross Blue Shield NC CEO Arrested

Alcohol Legislation Update

Bishop and Murphy Replacements Named

2019 Session Laws

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