Bill Summary for H 161 (2017-2018)

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Summary date: 

Feb 21 2017

Bill Information:

View NCGA Bill Details2017-2018 Session
House Bill 161 (Public) Filed Tuesday, February 21, 2017
AN ACT TO REQUIRE STATE DIVESTMENT FROM, AND PROHIBIT STATE AGENCIES FROM CONTRACTING WITH, COMPANIES THAT BOYCOTT ISRAEL AND TO AMEND THE EXISTING SUDAN AND IRAN DIVESTMENT STATUTES.
Intro. by Ross, Szoka, Hardister, B. Richardson.

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Bill summary

Enacts new Article 6G, Divestment from Companies Boycotting Israel, in GS Chapter 147, providing as follows. Requires the State Treasure, no more than 30 days after October 1, 2017, to adopt a policy prohibiting the North Carolina Retirement Systems or the Department of State Treasurer from directly investing in any company engaged in a boycott of Israel. Defines boycott Israel or boycott of Israel as engaging in refusals to deal, terminating business activities, or taking actions that are intended to penalize, inflict economic harm, or otherwise limit commercial relations specifically with Israel, or persons or entities doing business in Israel or in Israeli‑controlled territories; the term excludes decisions made for ordinary business purposes. Sets out the following minimum requirements for the policy: (1) requires the State Treasurer, within 120 days of adoption of the policy, to develop and make publicly available a list of companies determined to be engaged in a boycott of Israel; (2) requires the State Treasurer to identify any restricted companies in which the North Carolina Retirement Systems own direct holdings and indirect holdings; (3) requires the State Treasurer to annually review the list of restricted companies; (4 ) prohibits the North Carolina Retirement Systems and the State Treasurer from making direct investments in a restricted company; (5) requires the North Carolina Retirement Systems and the State Treasurer to sell, redeem, divest, or withdraw all direct holdings of restricted companies and instruct all investment advisors to sell, redeem, divest, or withdraw all direct holdings of restricted companies within 90 days after a company is placed on the State Treasurer's list of restricted companies; and (6) provides that the prohibitions under subdivision (3) do not apply to the North Carolina Retirement Systems' or the State Treasurer's indirect holdings or private market funds. Exempts the North Carolina Retirement Systems and the State Treasurer are from any conflicting statutory or common law obligations.

Makes a restricted company ineligible to contract with the State or any political subdivision of the State. Voids any contract entered into with a restricted company and specifies that existing contracts with restricted companies are allowed to expire in accordance with the terms of the contract. These restrictions do not apply to contracts valued at $1,000 or less. These restrictions also do not apply when a company fails to meet the certification requirements discussed below but offers to provide the good or service to be contracted for at a cost at least 20% less than the lowest certifying business. 

Requires a State agency to certify that a company that attempts to contract with the State or a political subdivision of the State is not a restricted company at the time the bid is submitted or the contract is entered into, renewed, or assigned. Requires a State agency to include certification information in the procurement record. Provides that if a State agency and the same company enter into multiple contracts or multiple contract renewals or assumptions within 180 days after a certification is made, a new certification is not needed. Prohibits a company that contracts with the State or a political subdivision of the State from using, on the contract, any subcontractor that is a restricted company. Specifies actions to be taken if a company fails to demonstrate that it should not have been identified as a restricted company within 90 days after the determination of a violation. 

Requires the State Treasurer to annually report to the Joint Legislative Commission on Governmental Operations by March 1 on information regarding investments sold, redeemed, divested, or withdrawn in compliance with the Article.

Effective October 1, 2017.

Effective when the act becomes law, authorizes the State Treasurer to retain the services of consultants, professional individuals, analysts, data collection firms, or other persons possessing specialized skills or knowledge necessary for the proper implementation and administration of the requirements of this act.