This Week at the Capital

This bill requires the State Board of Education to replace end-of-course (EOC) tests for grades 9-12 with a national assessment for students in 11th grade. The bill also directs the State Board to eliminate the required ACT WorkKeys assessments for career and technical education students.

Why we’re opposing: Now, more than ever, North Carolina must act to assess the unique academic needs and progress of every student, not eliminate the means in which to do so. Our students have experienced nearly one year of remote learning. Each child’s learning loss is different. Educators must quantify the learning loss early so that they can address knowledge gaps to ensure that our students are prepared for their pathways to higher education or career training such as apprenticeships and technical education. EOC tests and ACT WorkKeys assessments are essential tools for measuring student readiness for college or career so our children are set up for successful lives after high school.

The bill streamlines the process for N.C. teachers in earning their early childhood education credentials by allowing individuals to “test out” of required community college classes or receive a Child Development Associate Credential from the Council for Professional Recognition. At this time, individuals must complete early child coursework at a North Carolina community college to earn a North Carolina Early Childhood Credential. 

Why we’re supporting: Advancing additional pathways for individuals to earn a North Carolina Early Childhood Credential is vital to both a child’s academic future and a parent’s ability to work. Too many North Carolinians, mainly mothers, have left the state’s workforce due to child care demands. Filling early childhood teacher pipelines statewide is also essential to ensuring North Carolina has the talent for businesses landing and expanding in our great state.

The bill provides public schools in North Carolina with the ability to use remote learning days for snow closings or other emergency conditions causing campuses to close. The bill allows for this flexibility for remote instruction for up to five days per year in most districts.

SB671 also states schools that offered full-time virtual education in the 2021-2022 school year may continue providing full-time remote instruction in the 2022-2023 school year. Charter schools may also offer this option. Beginning in the 2023-2024 school year, public schools that meet certain requirements may establish remote academies.

Why we’re supporting: The COVID-19 pandemic revealed how our school systems must be prepared to educate students statewide in any emergency. This bill is a step forward in ensuring students across North Carolina can continue learning during future emergencies and that students can receive their education in the environment that best suits their needs. 

This bill would establish processes to allow for remote online notarization in North Carolina.

Why we’re supporting: In today’s increasingly digital business environment, job creators need additional flexibility to operate effectively. For this reason, the NC Chamber has been closely monitoring the stakeholder discussions surrounding this bill. We believe the version of the bill emerging from these discussions would give our state’s employers, like those in many other states, more of the flexibility they need to conduct important transactions and related business securely in the digital environment.

This bill would make a number of changes to state tax laws, simplifying the formula for calculating the franchise tax on business by tying it only to an organization’s net worth base (rather than the highest of three bases, as the tax is currently assessed) and reducing the personal income tax rate from 5.25 percent to 4.99 percent.

Why we’re supporting: The franchise tax is a regressive, non-competitive tax that penalizes businesses for making tangible investments in North Carolina. While the legislature simplified the franchise tax this past year, and should be commended for doing so, we continue to push for full elimination of this tax so that North Carolina job creators can invest more money in our economy. It will also make North Carolina more attractive for new business investment, raising our standing in the global race for jobs. A reduced personal income tax rate will further boost our competitive tax climate by lowering the tax burden on individuals and families, as well as the small business owners whose business income is taxed on this rate.

This bill would make a number of unwarranted changes to North Carolina statutes surrounding the validity of certain liens for medical charges in civil actions.

Why we’re opposing: House Bill 539 would inflate the amount of charges recoupable by injured parties when certain medical charges are at issue in civil actions, effectively resulting in the potential for phantom damages to be awarded to these parties.

This bill would make numerous changes to laws impacting third-party litigation funding in North Carolina, expanding the ability of certain entities to fund abusive litigation that could harm job creators and others in our state. It was amended to include harmful changes that would open new avenues for certain entities to fund abusive litigation in the state.

Why we’re opposing: Laws that expand third-party litigation funding threaten to increase the number of frivolous lawsuits flooding a state, driving costs upward across the entire tort system. This bill raises the very real potential for more frivolous lawsuits targeting employers as well as higher costs across our tort system. After taking time to vet the impacts of recent changes, the NC Chamber stands opposed to Senate Bill 357. We are engaging with lawmakers to ensure these concerns are addressed.

These companion bills would amend Rule 411 of the North Carolina Rules of Evidence regarding the admissibility of certain kinds of evidence in civil liability cases. Under North Carolina’s “collateral source rule,” compensation a plaintiff receives from insurance generally does not affect what they may recover directly from a defendant. This means it is possible that a plaintiff can recover for the very same damages both from a defendant and an insurer. The rule also guards against introduction of evidence that might convince a jury that because a defendant has insurance, the jury should be more liberal in awarding damages to the plaintiff. The proposed changes to Rule 411 appear to make clear that evidence of the existence of insurance other than liability insurance is n ot barred by the collateral source rule. Most dangerously, it would allow evidence of the limits of a defendant’s insurance to be admissible, which could easily have a prejudicial impact on the defendant. These measures would apply to proceedings pending on or after October 1, 2021.

Why we’re opposing: Upon initial examination, it appears this bill could, depending on how courts interpret its effect, increase costs and decrease predictability for businesses involved in civil liability cases.

This bill would make a number of unwarranted changes to North Carolina statutes surrounding the validity of certain liens for medical charges in civil actions.

Why we’re opposing: Senate Bill 476 would inflate the amount of charges recoupable by injured parties when certain medical charges are at issue in civil actions, effectively resulting in the potential for phantom damages to be awarded to these parties.

This bill would change North Carolina laws regarding attribution of negligence in personal injury lawsuits, moving North Carolina from a contributory negligence standard to a comparative negligence standard. The contributory negligence standard is based on the notion that a plaintiff generally should be ineligible to recover damages from a situation caused or exacerbated by their own negligence, while the comparative negligence standard allows damages to be assessed based on an allocation of negligence among the parties involved.

Why we’re opposing: This bill would change a longstanding aspect of North Carolina law that contributes to a well-established interplay of checks and balances on our civil liability system. This system of checks and balances helps promote the fair and reasonable treatment of both plaintiffs and defendants in personal injury cases and sets our competitive legal climate apart from those of most other states. Components of this system also ensure that “contributory negligence” does not bar a plaintiff’s recovery in just cases, like when a defendant is found to have engaged in willful or wanton misconduct. Moving away from the contributory negligence standard would raise litigation costs on job creators, and threaten businesses and individuals alike with higher liability insurance rates, damaging legal predictability and undermining the reestablishment of a top-10 business legal climate here in North Carolina. One noted 1991 study concluded that any state abandoning contributory negligence should expect to see significant liability cost increases across their tort systems. Learn more

This bill would confirm Regina Smith Adams’s appointment to the North Carolina Employment Security Board of Review.

Why we are supporting: We believe that Adams will be objective and fair as a representative for employees.

This bill would confirm Myra Griffin’s reappointment to the North Carolina Industrial Commission.

Why we are supporting: In her time as a Deputy Commissioner and Commissioner, Griffin has objectively and fairly applied North Carolina’s workers’ compensation law to ensure injured claimants receive the medical treatment and wages they deserve, while also ensuring that fraudulent and erroneous claims that damage the viability and stability of North Carolina’s mandated workers’ compensation system are rejected.

At a high level, this bill would enact in statute maximum contaminant levels for PFAS, require responsible dischargers to pay for PFAS removal and new technology for public water systems, require abatement in public systems, and add funding to the NC Department of Environmental Quality (NCDEQ) to support the new oversight and implementation.

Why we are opposing: The NC Chamber’s is opposing this bill as it would bypass the General Assembly enacted rulemaking process enabling NCDEQ to bypass the EMC and RRC processes for new regulations. Additionally, it would expand the scope of company liability and harm North Carolina’s business liability climate, and it would open the door for expansive cost increases on manufacturers with no mechanism for superior court review of any enforcement mechanism.

The bill would raise the maximum for the state’s unemployment insurance (UI) weekly benefit to $500 and would extend the eligibility to 26 weeks. SB848 would also allow for an employer tax credit that North Carolina’s business community is not seeking.

Why we are opposing: Until 2013, North Carolina suffered from a growing, multi-billion-dollar UI debt, and employers were paying the federal government 0.3 percent more in new FUTA taxes every year. Thanks to responsible reforms passed that year to increase accountability and build an investment to pay down the $2.8 billion debt, the state restored solvency to our UI system by 2015.

Lawmakers must examine the fiscal impacts of any permanent changes that might disrupt the long-term solvency of North Carolina’s UI fund and threaten the reforms achieved in 2013. The NC Chamber will always advise prudence when making decisions that could disrupt the balance of the UI trust fund. As representatives of the business community – the employers and job creators who pay the taxes that fund North Carolina’s UI program – we are committed to defending the future solvency of the state’s UI fund. If we create an unfavorable environment where employers are paying more relative to other states, businesses will not choose North Carolina – which ultimately means less job opportunities for North Carolinians.

This bill is an act to establish extended producer responsibility for certain producers of packaging materials and to ban the manufacturing and distribution of packaging materials containing certain substances.

Why We’re Opposing: This bill would harm the regulatory environment for the manufacturing sector.

The bill directs the Senate to consider the confirmation of Kody Kinsley as Secretary of the Department of Health and Human Services.

Why We’re Supporting: Secretary Kinsley has proven to be an advocate for the business community through his open communication and consistent engagement with the NC Chamber. We hope to work with him collaboratively in his focus areas of behavioral health, child and family wellbeing, and a strong and inclusive workforce, and serve as a resource when appropriate.

This bill would place limits on North Carolina counties and municipalities in prohibiting consumer choice over energy services based upon the type and source of energy to be delivered.

Why we’re supporting: Job creators, particularly those that pay commercial and industrial energy rates, must have flexibility in the management of their energy services to keep costs affordable and predictable. This bill ensures that employers in North Carolina will be able to choose energy sources – including natural gas, propane, and renewable natural gas sources – that enable them to maintain an optimal energy strategy best suited to their specific power, heating, and cost requirements.

This bill includes numerous provisions specifically dealing with agriculture and agribusiness. The bill would also distinguish hemp from marijuana by excluding it from the state’s list of controlled substances. The NC Chamber did not support the bill’s Right to Repair language for OEMs, or Original Equipment Manufacturers; however, that section has since been amended into a study by Senator Jackson which passed unanimously.

House committee substitute amends the definition of marijuana under the NC Controlled Substances Act, set out to explicitly exclude hemp and hemp products.

Why we’re supporting: The NC Chamber supports the bill language allowing for the predictability of growing hemp in the state of North Carolina. The bill is now on its way to Gov. Cooper’s desk.

This bill that would allocate a percentage of the total sales tax collected for transfer from the state’s General Fund to the Highway Trust Fund. The transfer would be marked at 2 percent in the 2023 fiscal year (est. $193.1 million), 4 percent in 2024 (est. $401.2 million), and 6 percent in 2025 and thereafter (est. $628.3 million in 2025, $655.9 million in 2026, and $684.8 million in 2027). The Highway Trust Fund invests in major infrastructure projects across the state and this increased funding would alleviate the pressures created by inflation and increased real-estate costs.

Why we’re supporting: The NC Chamber supports this effort as a key step in securing modernized, diversified revenue streams to keep our roads, railways, ports, and airports well-funded over the next decade and beyond.