Senate committee substitute makes the following changes to the 1st edition:

Amends the long title.

Enacts new GS 136-19.6 (Residue property disposal; Department authority; definitions; classification and valuation; disposition method; proceeds; approvals required). Declares state policy that the Department of Transportation (DOT) dispose of its residue real property as expeditiously as possible for the benefit of citizens and taxpayers. Authorizes DOT to manage, control, and dispose of real property acquired in fee simple that DOT determines to be residue property. Defines 10 terms as they are used in the statute. Directs DOT to adopt criteria to guide itself in classifying residue property according to its highest potential benefit to DOT or potential purchasers. Once classified, residue property that has not been disposed of within five years shall be reviewed and reclassified if appropriate. Provides three classes (A, B, and C) for residue property, as defined by potential for development or value to adjacent property, and a fourth (D) for property that has yet to be classified or may be needed by DOT for future use. Directs DOT to create and maintain a single comprehensive and up-to-date inventory of residue property owned in fee simple by the department. Directs DOT to utilize best efforts to dispose of Class A, B, and C residue property, with specific means of disposition authorized for each class of property. Provides that no service charge into the State Land Fund shall be deducted from or levied against the proceeds of any disposition of residue property under this statute. Net proceeds from disposition of residue property under this statute, minus any apportionment required by federal law or regulation, shall be deposited in the State Highway Fund. Conveyances of residue property require DOT and Board of Transportation approval. Conveyance of residue property with a residue property value of $10,000 or more additionally requires approval of the Governor and Council of State. Directs DOT to record all conveyances of residue property under this statute in accordance with GS 47-27 and other applicable state law. Authorizes DOT to adopt, amend, or repeal rules necessary to carry out the duties of this statute. Does not preclude reconveyance of condemned property to its former owner. Directs DOT to report to the Joint Legislative Transportation Oversight committee on the classification and sale of residue properties under this statute, as specified, by March 1 of each year, beginning in 2019.

Directs DOT to establish a pilot program for disposing of residue property, as under new GS 136-19.6. Provides specifications for the pilot program, including directions for a request for proposals to select three real estate brokers and three real estate auctioneers to dispose of residue property under the program. Directs DOT to review the progress of residue property disposition under each contract awarded through the pilot program. The pilot program terminates on January 1, 2019. Directs DOT to report to the Joint Legislative Transportation Oversight Committee on the classification and sale of residue properties under the pilot program, as specified, by March 1, 2018, and again by March 1, 2019.

Makes the act effective October 1, 2017 (was, July 1, 2017).