2017 North Carolina Legislative Session Update
The Legislature adjourned on June 30th. They are scheduled to come back August 3rd to deal with bills that passed both chambers by June 28th and to handle veto overrides. The report below has the bills that were tracked by CRMCA that are either law or are still eligible for consideration in the August 3rd special session.
Bills Either Law or Close to Law North Carolina
S257 Appropriations Act of 2017 – Ratified by legislature, vetoed by Governor, veto overridden
• In 2019, the corporate tax rate in North Carolina lowers from 3% to 2.5%
• Lowers the franchise tax for S-Corporations
• Repeals the Mill Machinery Tax and includes the clarification requested by CRMCA that sales of repair and replacement parts are taxed like mill machinery
• Requires a study by the Revenue Laws on how best to modernize and define the tax statutes for manufacturing equipment
• Establishes a fund for immediate need construction projects and provides $50 million annually to the fund.
• Provides an additional $40 million in 2017-18 and $75 million in 2018-19 and beyond for capital improvements at commercial airports.
• New Bridge Preservation Fund that aims to employ solutions to maximize bridge life and lower lifetime costs, and funds an additional $38M per year for bridge replacement.
• Provides an additional $5 million in 2017-18 and $15 million in 2018-19 and beyond for contract resurfacing.
• Increases funding for Strategic Transportation Investments by $139 million in 2017-18 and $180 million in 2018-19 and beyond.
Unemployment Insurance Changes – H5 enacted into law
• Waive the waiting week and work search requirements for unemployment insurance (UI) claims due directly to a disaster covered by a federal disaster declaration.
• Exclude paid time off, such as vacation and sick leave, from the definition of severance pay.
• Reduce the time allowed for employers to respond to UI claims from 14 days to 10 days.
• Transfer the UI account if part or all of a business is transferred between employers with substantially common ownership, management or control.
• Not transfer the UI account if a predecessor employer acquired the business solely or primarily for the purpose of obtaining a lower contribution rate.
Non-discrimination Ordinance – enacted in law
• H142 was the bipartisan compromise bill that repealed House Bill 2
Industrial Commission Changes – Some law and some in process
• S257 transferred the Industrial Commission from the Department of Commerce to the Department of Insurance now law
• H26 Fixed a recent Supreme Court decision that shifted the burden of proof for workers comp claims back to the employer, which undid reform that were passed a few years ago – ratified by legislature, presented to the Governor
• S407 establishes an Employee Classification Section to investigate reports of misclassification, not law, still waiting for Senate decision on House changes
Changes to Mechanics Lien Laws – H707 Lien Agent/Notice of Cancellation now is law
• A potential lien claimant would be permitted to cancel a lien agent notice by using an Internet Website approved by the owner’s designated lien agent.
• For improvements to a one- or two-family dwelling, a potential lien claimant would be required to cancel a lien agent notice within a reasonable time after confirming its receipt of final payment for its work.
• A lien agent notice would expire five years from the date of its delivery if not cancelled or renewed before then.
• A potential lien claimant could renew the notice for one additional five year period prior to its cancellation or expiration using the approved Web site, and the renewed notice would relate back to the original date of its delivery to the lien agent.
• Any protections provided to a potential lien claimant by delivery of a lien agent notice would terminate upon cancellation or expiration of the notice and would not be revived or renewed by subsequent delivery of a notice to the lien agent.
• Cancellation or expiration of a lien agent notice would not affect the validity of a previously filed claim of lien on real property or the priority of lien rights.
Coal Ash Action that is still eligible for August 3rd Session
• H374 Business Freedom Act was amended in the Senate with a provision to study the 3rd coal ash beneficial reuse project required by Duke Energy in law. The House leadership decided not to hear the changes made by the Senate to bill. It is still eligible for consideration in the August 3rd special session.
• H1301 is not law and changes stormwater management requirements by expanding what is not included in “built-upon area” to include, “landscaping material, that receives pedestrian or bicycle traffic or on portions of driveways and parking areas that will not be compacted by the weight of a vehicle, such as the area between sections of pavement that support the weight of a vehicle.”
A big thanks to all of our CRMCA Members who got involved in this year’s legislative work – contacting legislators, sending messages and more helped push many of our items over the line!