House committee substitute makes the following changes to the 1st edition.

Deletes a whereas clause.

Amends the definition of boycott Israel or boycott of Israel in proposed GS 147-86.80(1) to also exclude from the term decisions made for actions with an economic impact of less than $50 million in a 12-month period. Adds the term investment and defines the term to have the same meaning as GS 147-86.57(3). Deletes the terms direct holdings and indirect holdings.

Amends proposed GS 147-86.81 (Prohibition on State investment), requiring the State Treasurer to develop and make publicly available a list of companies determined to be engaged in a boycott of Israel, to use the following in the development of the list: any other state lists of restricted companies pursuant to similar laws; any federal information or guidance on companies that boycott Israel; and any other credible information provided by nonprofit organizations, research firms, and governmental entities; and generally publicly available information (previous edition called for the use of any federal sanctions lists; information provided by nonprofit organizations, research firms, and governmental entities; and generally available information).

Amends some of the requirements of the policy the State Treasurer must adopt under GS 147-86.81(a) prohibiting the NC Retirement Systems or the Department of the State Treasurer from directly investing in any company engaged in a boycott of Israel. Prohibits the NC Retirement Systems and the State Treasurer from investing funds with a company identified on the list as a company engaging in restricted investment activities (previous edition prohibited direct investments in a restricted company as well as acquiring securities of restricted companies as part of direct holdings). Directs any existing investment with a company identified as a company engaging in restricted activities to be divested within 180 days of the adoption of the policy under GS 147-86.81(a) (previous edition required the NC Retirement Systems and the State Treasurer to, or instruct all investment advisors to, sell, redeem, divest, or withdraw all direct holdings of restricted company within 90 days after the company is placed on the State Treasurer's list of restricted companies). Deletes provision providing that the prohibitions under subdivision (3) of GS 147-86.81(a)(2) do not apply to the North Carolina Retirement Systems' or the State Treasurer's indirect holdings or private market funds. Provides that nothing in the policy or new Article 6G requires the NC Retirement Systems or the State Treasurer to take action unless it is determined by the State Treasurer, in good faith, that the action is consistent with the fiduciary responsibilities of the Retirement Systems and the State Treasurer (previous edition exempted the NC Retirement Systems and State Treasurer from any conflicting statutory or common law obligations when acting in compliance with the statute in good faith).

Amends proposed GS 147-86.82 to specify that contracts in existence on October 1, 2017, with restricted companies are allowed to expire in accordance with the terms of the contract, but any contract entered into with a company that is identified as a restricted company at the time of the contract is void (previous edition distinguished a date relating to contracts in existence). Adds new provision to require a State agency to review the information and offer the company an opportunity to respond upon receiving information that the company was not identified as restricted at the time of contract but has later been identified as a restricted company. Allows the State agency to take appropriate action provided by law, rule, or contract if the company fails to demonstrate that the company should not have been identified as a restricted company within 90 days after notification by the State agency. 

Deletes proposed GS 147-86.74, requiring 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. Makes conforming changes.

Changes the date by which the State Treasurer must annually report to the Joint Legislative Commission on Governmental Operations to October 1 (was, March 1) on information regarding investments sold, redeemed, divested, or withdrawn in compliance with the new Article.