Old North State Report - March 31, 2017
One year and one week after its initial passage, House Bill 2 has been repealed and replaced. After months of wrangling and a week filled with political intrigue, the legislature approved House Bill 142 (“Reset of State Law 2016-3”) in its place. The outcome was a result of negotiations between Senate leader Phil Berger, House Speaker Tim Moore, and Governor Roy Cooper. Interest groups on both the right (such as the NC Family Policy Council, the Values Coalition, and Lt. Governor Dan Forest) and the left (including the Human Rights Campaign, the NAACP, and the ACLU) were bitterly unsatisfied with the compromise. Meanwhile, business groups breathed a sigh of relief.
Here is the staff’s summary of the legislation:
Here is the actual text (signed into law by Governor Cooper):
Here is the 32-16 Senate vote (note the division among both political parties):
Here is the 70-48 House vote (again, please note the division among both political parties):
Lawmakers have spent huge expanses of time over the past year discussing the controversial measure dealing with LGBT rights and the use of bathrooms by transgender individuals both behind closed doors and in public. Although the replacement measure is not universally popular -- advocates on both the political left and right panned the measure Thursday -- legislative leaders say passing it unclogs the lawmaking pipeline.
"It has consumed the vast majority of this session so far," House Rules Chairman David Lewis (R-Harnett), said Thursday shortly after the House vote. Representative Chuck McGrady (R-Henderson), who has pushed lawmakers toward compromise for the better part of a year, said Thursday that people both in the General Assembly and outside the building are "fatigued" by the issue. Economic developers, local officials, and a variety of businessmen say explaining House Bill 2 or mitigating its impact has consumed a lot of time and effort. "Now it's time to go back to legislating," McGrady said.
We expect the pace of consideration of legislation in committees and on the floor will quicken. This week, alone, there were 189 new bills filed in the Senate as its bill filing deadline neared.
Major corporate and personal income tax cuts are moving forward in the Senate, although some Democrats are opposing them because they worry the state will lose billions of dollars in needed revenue. The Senate Finance Committee on Wednesday passed Senate Bill 325 (see link below), titled "Billion-Dollar Middle-Class Tax Cut," with a few Democrats voting no. The plan -- more sweeping than a House tax cut proposal under consideration this year -- would reduce the personal income tax rate from 5.499 percent to 5.35 percent, which Senate Republicans say would be one of the lowest rates in the country. The Senate plan would also increase the standard deduction from $17,500 to $20,000 for a married couple filing jointly, with similar increases for other tax status categories. Because a married couple making less than $20,000 wouldn't owe any income taxes, the Senate estimates the change would take 94,000 families off the tax rolls.
State Health and Human Services Secretary nominee Dr. Mandy Cohen received a unanimous vote from the Senate Health Care Committee during her confirmation hearing Wednesday. Her past work with the Obama Administration was thought to be a liability among Republican lawmakers but she has worked to win them over with personal visits and a pledge to uphold state laws:
Senate Republicans haven't yet gotten to questioning North Carolina's new environmental agency chief as part of the confirmation process of Democratic Gov. Roy Cooper's Cabinet. A co-chairman of the Senate environment and agriculture committee said Thursday's scheduled hearing to talk with Department of Environmental Quality Secretary Michael Regan was canceled. Senator Andy Wells of Catawba County said a lot of things were happening Thursday and sometimes scheduled meetings don't occur. The Senate spent Thursday morning voting on legislation to replace the state law limiting LGBT protections known as House Bill 2. Wells says Regan's hearing could be rescheduled for next week. Regan was a longtime advocate for the Environmental Defense Fund and previously worked at the U.S. Environmental Protection Agency.
Beer sales are a hot topic this session. House Bill 500 (“ABC Omnibus Legislation”), sponsored by Representatives Chuck McGrady and Jon Hardister, would raise the self-distribution limit from 25,000 barrels to 200,000 barrels and make a number of other changes to benefit small craft brewers. Wholesalers oppose the legislation:
Senate Republicans introduced legislation (Senate Bill 467: “North Carolina Retirement Reform”) to enroll state employees newly hired after July 1, 2018 into defined contribution programs rather than participate in the state’s existing retirement benefits:
The articles published in this newsletter are intended only to provide general information on the subjects covered. The contents should not be construed as legal advice or a legal opinion. Readers should consult with legal counsel to obtain specific legal advice based on particular situations.