North Carolina General Assembly Week in Review

by McGuireWoods LLP

Senate Starts Budget Process

The Senate started its budget process this week, with a draft schedule being handed out to senators on Wednesday outlining precisely how the General Assembly can have a budget in place and approved by June 30. Distributed at appropriations subcommittee meetings, the tentative schedule plans for the chamber to develop its version of the budget through the first week of June and hold a third-reading vote on Thursday, June 11. That would lead to a conference process between the House and Senate playing out for the remainder of the month of June, closing with an approved compromise budget on June 30, the final day of the fiscal year.

View the Senate 2015 Appropriations Schedule here

House Bill 795, State Environmental Policy Act (SEPA) Reform, Passes Senate, House Fails to Concur

The Senate on Tuesday approved House Bill 795, State Environmental Policy Act (SEPA) Reform, which narrows the applications of SEPA. The chamber had already given tentative approval of the measure last week on a second reading vote of 33-14. Currently, SEPA requirements include providing environmental impact statements in projects involving public money or land, which can serve as a potential safe guard and way to understand alternatives to possible ecological harm. SEPA critics say that it slows important public improvements like road development. They also say that regulations otherwise are adequate enough to protect sensitive land.

The bill as it appeared on the Senate floor would have triggered environmental impact studies for projects exceeding $20 million, or which disturbed more than 20 acres of land. Senator Angela Bryant (D-Nash), however, said she felt these provisions could leave SEPA “totally gutted,” and was ultimately successful in sponsoring an amendment to bring the requirements down to $10 million and 10 acres. This provision is similar to what the House had previously passed, though their proposal set a five acre requirement in conjunction with a $10 million trigger. The bill was sent to the House for concurrence Thursday afternoon, with the House voting not to concur. A conference committee has been appointed.

Read H795 here

House Votes to Allow Magistrates to Opt Out of Same-Sex Marriages, Governor Issues Veto

Hours after the House gave final approval to a bill that would allow magistrates to opt out of performing same sex marriages for religious reasons, Governor Pat McCrory (R-NC) vetoed the legislation. His decision puts him at odds with social conservatives in his party as well as with Republican legislative leaders who spearheaded the legislation. Speaking in a written statement on Thursday afternoon, the governor said, “I recognize that, for many North Carolinians, including myself, opinions on same-sex marriage come from sincerely held religious beliefs that marriage is between one man and one woman. However, we are a nation and a state of laws. Whether it is the president, governor, mayor…or magistrate, no public official who voluntarily swears to support and defend the Constitution should be exempt from upholding that oath.” The governor vetoed the bill a half hour after issuing his written statement, spokesman Josh Ellis said.

Senate Bill 2, Magistrates Recusal from Civil Ceremonies, would allow North Carolina magistrates and register of deeds employees to opt out of performing same sex marriages if they have a religious objection. Sponsored by Senate President Pro Tempore Phil Berger (R-Rockingham), the measure came in the wake of the legalization of same-sex marriages in NC last year. It was given final approval in the Senate by a vote of 32-16, and the House held an extended debate on the measure both Wednesday and Thursday afternoon, before giving final approval in a 67-43 vote.

Opponents of the measure say that it will allow discrimination against same-sex couples by making it more difficult to obtain a marriage, but Representative Dean Arp (R-Union), who presented the bill on the House floor, said that S2 “ensures that civil ceremonies will be performed and outlines a process by which we balance the sincerely held religious beliefs of the employees and the duties of the state to perform these marriages.” Magistrates who seek an exemption under the terms of the bill would be unable to perform weddings for at least six months.

House Minority Leader Larry Hall (D-Wake), however, said he felt the legislation was “creating a situation where people can discriminate against other members of society and not be removed from their position…I am not going to be in favor of legislating second-class citizenship.” Supporters of the bill say they feel fears of discrimination are unfounded since the bill would require county courthouses to offer weddings at least ten hours a week on three business days. Rep. Leo Daughtry (R-Johnston) said that a marriage ceremony “may not be not be at that instance, but it will occur in the county…it’s not like they’re being turned down.” Under the terms of the bill, the Administrative Office of the Courts would be responsible for making sure magistrates who haven’t taken the exemption would be available to perform their duties.

The bill now returns to the General Assembly, where legislators will have to decide whether to override the veto. This would require at least a three-fifths majority in both chambers. The House and the Senate passed the bill by margins above the threshold, although the 67-43 House vote was barely above it. Ten House members had excused absences and didn’t vote. Of those, five are Republicans, four are Democrats and one is unaffiliated Rep. Paul Tine (R-Dare) who caucuses with Republicans. House Speaker Tim Moore (R-Cleveland) and Senate President Phil Berger did not address a possible override in a joint statement on Thursday afternoon, saying that they “respect but disagree with the governor’s decision.” Gay rights group Equality North Carolina praised the veto and urged lawmakers to keep it in place, saying that doing so “sends a strong message.” The Christian conservative North Carolina Values Coalition, however, said that the measure protects religious freedom and that it was “unacceptable for any governor who calls himself ‘conservative’ to veto this legislation.”

Read S2 here and Gov. McCrory’s statement here

House Bill 909, ABC Omnibus Legislation, Given Tentative Approval in Senate

House Bill 909, ABC Omnibus Legislation, was given tentative approval on the Senate floor Thursday by a vote of 40-8. Initially, the bill dealt only with regulating sales of antique spirituous liquor, but after numerous amendments, it now includes provisions dealing with Cherokee Indian alcohol permit authority, contract brewing and a ban on powdered alcohol.

One of the bill’s more notable provisions would allow distilleries who make less than 100,000 proof gallons per year to sell liquor by the bottle, the first time liquor would be available outside of an ABC Store in North Carolina since Prohibition. Bottled liquor purchases would, however, be limited to one bottle per-person over a 12 month period. Distilleries who support the measure argue that the change will result in more sales and better tax revenue for the state, but the N.C. Association of ABC Boards says that the change will take away much-needed business from their stores.

One of the bill’s other provisions would allow for alternating proprietorships at breweries, when different beer makers take turns utilizing one physical facility. Under current law, that arrangement can be viewed as a transfer of ownership, which would void the host brewery’s permit. The measure would also allow breweries to both receive and sell malt beverages made by other brewers under contract. Margo Metzger, Executive Director of the N.C. Craft Brewers Guild, said of the bill, “These are critical provisions to allow our burgeoning industry to continue to grow and thrive.” Once the Senate grants final approval to the bill, it will go to the House for concurrence.

Read H909 here

Bill to Extend Abortion Waiting Period Moves Forward in Senate

A measure that would require North Carolina women to wait three days for an abortion passed second reading in the Senate on Thursday, despite objections from Democrats and abortion rights activists. House Bill 465, Women and Children’s Protection Act of 2015, passed second reading on the Senate floor by a vote of 31-15, largely split down partisan lines. The measure now awaits a final vote next week.

The heart of the proposal involves extending the waiting period for abortions from 24 hours to 72 hours. Supporters say the three day period is appropriate for such a critical decision. Bill sponsor Sen. Joyce Krawiec (R-Forsyth) said she felt that “for almost all important decisions in our life, we have a waiting period…when you’re making life-changing decisions; time is always beneficial to all of us.” Critics, however, said they felt the extra waiting time would impede access to abortions, particularly for women in rural areas and the poor. Doctor Kim Boggess, an obstetrician at the University of North Carolina hospital, said she felt the bill would “reduce access to the very people who need protection.”

Another part of the bill involves a mandatory reporting requirement that compels any physician advising or performing an abortion after 16 weeks to document the probable age of the fetus, including an ultrasound, to the Department of Health and Human Services. Although language in the bill states the information would be “for statistical purposes only,” critics said it was another way to curtail legal abortions. Critics also complained about a provision that would only allow a physician certified in obstetrics or gynecology to perform the abortion.

In addition to the abortion language, the bill includes parts of at least six other measures, some authored by Sen. Jeff Jackson (D-Mecklenburg) and other Democrats. Those provisions would expand the definition of statutory rape to cover all children under 15, make it easier to collect child support payments through administrative changes and create a “Maternal Mortality Review Committee” to recommend steps to prevent deaths from pregnancy or child birth.

Read H465 here

New Screening Test for Newborns Passes House

House members on Thursday passed a measure 109-1 that adds a new test for a life-threatening genetic disorder to the screening panel for newborns in North Carolina. The additional test would check for severe combined immunodeficiency (SCID), a genetic defect that is also known as the “Bubble Boy disease.” Babies born with SCID lack a functioning immune system, making them susceptible to any disease in their environment. SCID can be treated successfully before babies are 14 weeks old, but the condition often isn’t diagnosed until months later, when treatment is much less effective. Left untreated, it’s almost always fatal.

House Bill 698, Baby Carlie Nugent Bill, is named after a baby from Cabarrus County who died of SCID in 2000. The baby’s mother, Stephanie Nugent, attended the House Health Committee hearing in person on Wednesday to ask committee members to support the proposal. Nugent said her daughter appeared to be a completely healthy newborn at first, but by the time she was finally diagnosed with SCID, it was too late to save her. She died at only seven months old. Speaking to committee members, Nugent said, “When babies are born with SCID, time is not on their side…I am forever haunted by the knowledge that a simple blood test at birth is all that stood in the way of watching her grow up.”

Under the language of the bill, five dollars would be added to the state’s blood testing fee for newborns to offset the cost of the new screening. Rep. Charles Jeter (R-Mecklenburg) sponsored the measure and said that the state public health lab had already won a grant to pay for the testing machine and that the $466,000 in state money is appropriated in the bill for implementation. After clearing the House, the bill now heads to the Senate.

Read H698 here

Governor Pushes Legislature Hard on Infrastructure Bond

Gov. McCrory visited the Legislative Building on Wednesday to lobby Republican legislators to allow voters to decide on his proposal to issue statewide bonds for roads, ports and buildings this year. Former state budget director Art Pope also attended the closed-door meeting in the Legislative Building's auditorium and shared polling results on the issue gathered by The Renew North Carolina Foundation, a non-profit political advocacy organization formed to boost the McCrory Administration's agenda. Pope said he expected the poll results to be made public next week.

Speaking to reporters after the meeting, Gov. McCrory didn’t disclose what kind of reception his pitch was met with in the GOP caucus meeting, but he did say that he felt the people of North Carolina were coming around to his position. The caucus meeting was attended by Republican legislators from both chambers, including Senate President Phil Berger and House Speaker Tim Moore. Republican leaders in the legislature have previously warned the governor that he will have a difficult time convincing some members to spend three billion dollars in bonds to fund highway projects and fix state facilities. Speaker Moore has said he isn't convinced that the issue should go to voters in November, as the governor proposes, and instead said he felt the vote would draw a bigger turnout if it was held during the 2016 presidential primary.

Both Gov. McCrory and members of his administration have been trying to build support for the bonds around the state, since he announced his desire to seek them in his State of the State message in February. His visit to the legislature on Wednesday was intended to keep that momentum going, but so far, the legislature hasn't publicly discussed putting the bonds on the ballot, after having spent the last few weeks focused on writing state budget proposals.

Gov. McCrory is pushing ahead, however, trying to take advantage of low interest rates. He has said that the longer the state waits, the more the improvements will cost, as members of his staff estimate that interest rates will go up at the end of 2015.

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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