Bill Summary for H 309 (2023-2024)

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Summary date: 

Jun 12 2024

Bill Information:

View NCGA Bill Details2023-2024 Session
House Bill 309 (Public) Filed Wednesday, March 8, 2023
Intro. by Iler.

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Bill summary

Senate committee substitute to the 2nd edition removes the content of the previous edition and replaces it with the following. Makes conforming changes to the act's titles. 

Section 1

Amends GS 20-2 to require that the Commissioner of Motor Vehicles be appointed by and serve at the pleasure of the Governor instead of the Secretary of the Department of Transportation (DOT). Makes the Governor's appointment subject to the Senate's advice and consent. Makes organizational changes to the statute.

Section 2

Authorizes DOT to utilize design-build, indefinite delivery, indefinite quantity, public-private partnership, or any other contracting methodology authorized by applicable federal law to administer the National Electric Vehicle Infrastructure (NEVI) Formula Program. Specifies that for these purposes, DOT projects which use contracting methodologies authorized by this provision to implement, administer, or use NEVI Formal Program funds will not count against DOT project contract award authorization caps limiting the use of certain construction methodologies. 

Section 3

Repeals Section 11 of SL 2021-134, which allowed DOT to manage, procure information technology goods and services, and enter into contracts for up to five information technology projects for Division of Motor Vehicles (DMV) system modernization, and exempted those projects from Department of Information Technology oversight and requirements.

Prohibits DOT from renewing and allows to expire any contract that was entered into under the exemption that was in Section 11 of SL 2021-134.

Requires the Department of Information Technology to consult with DMV and develop and issue a Request for Proposal (RFP) to contract with a third party to evaluate the DMV’s ongoing efforts to modernize its information technology (IT) systems. Sets out seven issues that must be addressed in the evaluation, including: (1) an in-depth analysis of the DMV’s plan to implement a cloud-based operating system and any other updates to its IT systems; (2) an estimate of when the DMV’s anticipated updates to its IT systems will begin directly improving customer service; and (3) an assessment of whether the DMV has an adequate personnel management plan in place to implement planned updates to its IT systems. Requires funding for implementation be provided by funds previous appropriated to DMV for the purpose of IT modernization. Requires DMV to report on the evaluation to the chairs of the specified NCGA committees and division by January 31, 2025.

Requires DMV, in consultation with DIT, by May 1, 2025, to use the evaluation findings to select a vendor to oversee and manage implementation of the cloud-based operating system. Sets out reporting requirements for the vendor.

Section 4

Repeals Section 7.1 of SL 2023-136 (S512) which replaced one of the Governor’s appointees to the North Carolina Railroad Board of Directors with an appointee by the State Treasurer. Repeals Section 6.4 of SL 2023-139 which requires that if Senate Bill 512, 2023 Regular Session, became law, then the North Carolina Railroad Board of Directors must elect a chair pursuant to GS 124-15(a), as amended by Section 7.1(a) of that act, no later than 90 days after the date that the member to be appointed by the State Treasurer has been initially appointed.

Amends GS 124-15 by replacing one of the Governor’s appointees to the North Carolina Railroad Board of Directors with the Commissioner of Agriculture or their designee. Removes outdated language. Adds that each member of the Board of Directors for any State-owned railroad company must have the fiduciary duties to the State-owned railroad company.

Requires that the Governor’s appointee replaced by the Commission of Agriculture be one with a term beginning in 2023, and requires that the Commissioner serve for the remainder of the term. Requires the Board of Directors to decide which of the appointees will be replaced.

Amends GS 124-1 to provide that the Governor and Council of State do not have charge of the State’s interest in a State-owned railroad company. Makes a technical change in GS 124-11.

Section 5

Adds new Article 33, Rail Transportation Corridor Authority, to GS Chapter 160A, providing as follows. Sets out and defines terms used in the Article. Defines rail corridor as a combination of rail line and real and personal property, structures, improvements, buildings, equipment, vehicle parking, and other appurtenant fixtures essential to rail operations and public transportation, including any facilities, maintenance yard, marshalling yard, transfer yard, utilities, pedestrian foot paths, and bicycle paths. Defines rail corridor project as any of the following that is part of or used in connection with a rail corridor and is not a special user project (as defined): (1) any land, equipment, or buildings or other structures, whether located on one or more sites within a rail corridor, or (2) the addition to or the rehabilitation, improvement, renovation, or enlargement of any property described above. Specifies that the term rail corridor project includes infrastructure improvements, such as improvements to railroad facilities, roads, bridges, and water, sewer, or electric utilities. Allows a rail corridor project to include a facility leased to one or more entities under a true lease. Defines a unit of local government as a county, city, town, or municipality of this State, and any other political subdivision, public corporation, authority, or district in this State, that is or may be authorized by law to acquire, establish, construct, improve, maintain, own, or operate a rail corridor.

Allows the creation of a Rail Transportation Corridor Authority (Authority) for any area of the State that, at the time of creation of the Authority meets the following: (1) the area consists of three or more contiguous counties each containing portions of an existing rail corridor, with one of the counties having a population in excess of 150,000 but less than 200,000 based on the 2020 census and the other two contiguous counties having a population in excess of 75,000 but less than 90,000 based on the same census; (2) the distance between the rail corridor milepost origination and termination points is no more than 25 miles long; (3) if the Authority intends to receive existing rail corridor interests in property, those interests can be transferred to the Authority without purchase of those interests; and (4) an Authority must not have jurisdiction over any Class I railroad, nor a rail line or rail corridor owned or operated by the US Department of Defense, nor a rail line owned or operated by the North Carolina Railroad Company or its subsidiaries. Requires the Authority’s territorial jurisdiction to be coterminous with the boundaries of the three or more organizing counties, except when the Authority intends to receive existing rail corridor interests in property than can be transferred without purchase. Requires the Authority’s rail corridor service area to be designated by and recorded in the minutes of the Authority’s Board of Trustees (BOT), consistent with its purpose, and must not exceed immediately adjacent and proximate area of the rail corridor as owned or otherwise controlled by the Authority. Requires the boundaries of the Authority’s rail corridor to be designated by and recorded in the BOT’s minutes once the properties and rail line making up the rail corridor are in the Authority’s possession or control. Sets out the conditions that must be met before the Authority can extend the rail corridor into a political subdivision that is not an organizing entity. Prohibits the Authority from extending its rail corridor to be longer than 25 miles through any subsequent addition. Sets out requirements for how the rail corridor boundaries are to be described.

Requires the adoption of a resolution to create an Authority by the boards of commissioners of all three or more counties within an area for which an Authority may be created and the elected board of municipality containing a portion of the rail corridor. Requires a public hearing before adoption of the resolution and sets out requirements for notice of the public hearing. Requires the resolution to form an Authority to include articles of incorporation that set forth specified information. Requires that a certified copy of each resolution organizing an Authority to be filed with the Secretary of State, along with proof of publication of the notice of hearing. Upon finding that those items conform to this Article, requires the Secretary of State to issue a certificate of incorporation. Sets out the process under which counties or municipalities may join the Authority when the Authority intends to extend the rail corridor into a new county or municipality. Specifies that members of the BOT are not subject to personal liability or accountability by reason of their execution of any debt held by the Authority. Pays BOT members $50 for each Authority meeting they attend. Requires the Authority to submit an annual report to the Governor, NCGA, and Local Government Commission; specifies what must be included in the report. Also requires the Authority to submit its annual reports to the Joint Legislative Commission on Governmental Operations.

Requires the BOT to consist of one member of each organizing entity that has adopted a resolution for the creation of or a resolution to join the Authority, and one member for each regional council of government containing a portion of the rail corridor. Sets out additional provisions governing the appointment of members, establishing a quorum, election of chairs and vice-chairs, and filling of vacancies. Require an affirmative vote equal to a majority of all members not excused from voting in order to authorize or commit the expenditure of public funds, or make, ratify, or authorize any contract on behalf of the Authority.

Allows the BOT to select advisory committees it may find appropriate.

Gives the Authority all powers necessary to execute the Article, which includes as least the 16 specified powers, including powers to: (1) operate a rail corridor and enter and perform contracts to provide and operate rail and rail corridor services and facilities within the rail corridor service area; (2) charge and collect fees and rents for the use of the rail corridor or for services rendered in the operation of the rail corridor; (3) make or enter contracts, agreements, deeds, leases with or without option to purchase, conveyances, or other instruments, including contracts and agreements with the US, the State, units of local government, public transportation authorities, and private parties, to effectuate the purpose of this Article; (4) with the consent of the unit of local government that would otherwise have jurisdiction to exercise the powers enumerated in this subdivision, to issue certificates of public convenience and necessity, and to grant franchises and enter into franchise agreements, and in all respects to regulate the operation of rail, buses, trams, taxicabs, and other methods of public transportation that originate and terminate within the rail corridor as fully as the unit of local government is now or hereafter empowered to do within the jurisdiction of the unit of local government; and (5) issue debt for the purpose of financing the costs (defined as the capital costs of a rail corridor project or special user project) of a rail corridor project or any part thereof and to refund, whether or not in advance of maturity or the earliest redemption date, any such debt. Requires the BOT to, in order to execute these powers, to determine the policies of the Authority by majority vote of those members present and voting. Gives the chair the sole and exclusive authority the execute the polity of the Authority.

Specifies that an Authority is a public authority and is subject to GS Chapter 159, The Local Government Finance Act.

Allows the State and any unit of local government to appropriate funds to support the establishment and operation of the Authority, or to dedicate, sell, convey, donate, or lease any of their interests in any property to the Authority. Allows an Authority to apply for grants from the State, or from the US or any department, agency, or instrumentality thereof. Allows the Department of Transportation to allocate to an Authority any funds appropriated for rail corridors, public transportation, or any funds whose use is not restricted by law.

Sets out items that must be include in every special user project financing agreement. Requires the agreement, if in the nature of a lease agreement, to either provide that the obligor must have an option to purchase, or require that the obligor purchase, the special user project upon the expiration or termination of the financing agreement subject to the condition that payment in full of the debt principal shall have been made. Allows the financing agreement to give the Authority rights and remedies in the event of a default by the obligor, including, without limitation: (1) acceleration of all amounts payable under the financing agreement; (2) reentry and repossession of the special user project; (3) termination of the financing agreement; (4) leasing or sale of foreclosure of the special user project to others; and (5) taking whatever actions at law or in equity may appear necessary or desirable to collect the amounts payable under, and to enforce covenants made in, the financing agreement. Provides that the Authority's interest in a special user project under a financing agreement may be that of owner, lessor, lessee, conditional or installment vendor, mortgagor, mortgagee, secured party, or otherwise, but the Authority does not need to have any ownership or possessory interest in the special user project. Allows the Authority to assign all or any of its rights and remedies under the financing agreement to debt holders under a security document.

Allows a county or municipality in which all or part of the rail corridor is located to enter into an agreement with the Authority providing for payments to be made by the county or municipality, as applicable, to the Authority; such an agreement may be entered into only after the Authority designates the rail corridor.

Exempts the Authority’s real and personal property, its acts, activities, and income from taxation. Specifies that this exemption does not apply to the value of a leasehold interest or to a lessee’s income.

Specifies that the Article does not limit or affect the power or authority of the North Carolina Utilities Commission or the right of appeal to the North Carolina Utilities Commission as provided by law. Specifies that the North Carolina Utilities Commission does not have jurisdiction over rates, fees, charges, routes, and schedules of an Authority for service within the rail corridor.

Gives the Authority the power to require any public utility, railroad, or other public service corporation owning or operating any installations, structures, equipment, apparatus, appliances, or facilities in, upon, under, over, across, or along any ways on which the Authority has the right to own, construct, operate, or maintain its rail corridor, to relocate such installation, structures, equipment, apparatus, appliances, or facilities from their locations, or, in the sole discretion of the affected public utility, railroad, or other public service corporation, to remove such installations, structures, equipment, apparatus, appliances, or facilities from their locations. Allows the Authority to relocate the object if the owner or operator fails or refuses to do so. Requires the Authority to provide any necessary new locations and necessary real estate interests for such relocation, and may exercise eminent domain for that purpose if the new locations is not in, on, or above, a public highway; the Authority may also acquire the necessary new locations by purchase or otherwise. Requires compensation for any affected public utility, railroad, or other public service corporation for any real estate interest taken via eminent domain, subject to the right of the Authority to reduce the compensation due by the value of any property exchanged under this statute. Requires the method and procedures of a particular adjustment to the facilities of a public utility, railroad, or other public service corporation to be covered by an agreement between the Authority and the affected party. Requires the Authority to reimburse the public utility, railroad, or other public service corporation, for the cost of relocations or removals, to be calculated as specified.

Gives the Authority power to acquire the fee or any lesser interest in real or personal property for use by the Authority. Prohibits the Authority from acquiring or taking by eminent domain, or any means, property owned or operated by any Class I railroad, nor a rail line or rail corridor owned or operated by the US Department of Defense, nor a rail line owned or operated by the NC Railroad Company or its subsidiaries, without the that railroad’s consent. Also allows the Authority to exchange any property it acquires for other property usable in carrying out the powers conferred on the Authority and also, upon the payment of just compensation, may remove a building or another structure from land needed for its purposes and reconstruct the structure on another location (prohibits using eminent domain to acquire property for exchange). Sets out issues that must be considered when the Authority selects one or more sites for adjoining rail facilities or property for shell or storage buildings. Sets out the process and effect of dissolving the Authority.

Amends GS 160A-20, concerning security interests, by adding an Authority to the definition of a unit of local government as it is used under the statute.

Section 6

Adds a severability clause.