Part I.

Adds new Article 24, Office of Engineering and Codes in GS Chapter 95, providing as follows. Creates the Office of Engineering and Codes within the Department of Labor, exercising its powers and duties independent of the Department. Makes the Office responsible for the following, all of which were the responsibility of the Office of the State Fire Marshal: Building Code Council and Residential Code Council, North Carolina Manufactured Housing Board, Uniform Standards Code for Manufactured Homes, North Carolina Code Officials Qualification Board, North Carolina Home Inspector Licensure Board, and the Engineering and Building Codes Division.  Makes the “State Engineer” the head of the Office, to be appointed by the Commissioner of Labor, subject to confirmation by the NCGA, to serve a three-year term; sets out provisions governing the State Engineer's salary. Requires the State Engineer to see that all laws the State Engineer is responsible for administering are faithfully executed and, authorizes him to adopt rules in order to enforce, carry out, and make effective the provisions of those laws. Authorizes the State Engineer to adopt further rules not contrary to those laws that will prevent persons subject to the State Engineer's regulatory authority from engaging in practices injurious to the public. Makes the Office a public office whose records, reports, books, and papers are open to the public, with exceptions.

Sets out provisions governing hearings and investigations undertaken by the Office. Gives the State Engineer power to arrest with warrant or cause a person to be arrested. Sets out procedures applicable to a contested case involving the Office. Allows the State Engineer to order payment of a penalty, upon finding that a person has violated this Article, instead of suspending or revoking the license. Sets the allowable penalty amount at $100-$1,000 and sets out what must be considered in determining the amount of the penalty; requires penalty proceeds to be remitted to the Civil Penalty and Forfeiture Fund. Sets out a process by which the State Engineer can petition the court to order a person committing a violation to make restitution to the victim. Subjects any order or decision made by the State Engineer to review in the Superior Court of Wake County upon petition by the aggrieved person within 30 days from the date of the delivery of the order or decision by the State Engineer. Sets out the process for the review. Sets out provisions governing using State Engineer documents as evidence and the appearance of the State Engineer or Office employees as expert witnesses. Requires development of a seal and requires the State Engineer or the State Engineer's designee to administer all required oaths.

Allows the State Engineer to apply to superior court when it appears there is a violation of Article 9A of GS Chapter 143 (NC Manufactured Housing Board—Manufactured Home Warranties) and allows the court to issue an order restraining and enjoining the violations and allows granting relief regardless of whether criminal prosecution is instituted. Specifies that conviction for a criminal violation of Article 9A automatically suspends that person’s license. Allows an Article 9A licensee to surrender their license when they are accused of any act, omission, or misconduct that would subject them to license suspension or revocation.

Requires applicants for licenses issued by the State Engineer to inform the State Engineer of their address and email, and notification in the specified time frame when that information changes; violations are subject to a fee. Sets out requirements for notifying the State Engineer of criminal convictions.  

Allows the State Engineer to create advisory committees of up to 13 members to consult with and advise the State Engineer in detailed technical areas or as a representative of citizen advice in specific areas of interest.

Gives the State Engineer general supervision over local inspectors or local investigators related to matters under the Office’s jurisdiction.

Repeals GS 143A-78 (which transferred the Building Code Council to the Department of Insurance) and GS 58-78A-12 (concerning the State Fire Marshal’s duties related to manufactured housing, restraining orders, criminal convictions, license surrenders).

Part II.

Amends GS 58-6-25 to allow funds in the Insurance Regulatory Fund to be used to reimburse the Genal Fund for money appropriated to (1) the Department of Justice to pay expenses for representing the Department of Labor in related programs and industries in North Carolina that fall under the Office’s jurisdiction; (2) the Department of Labor to pay expenses in connection with providing staff support for State boards, councils, and divisions falling under the Office’s jurisdiction; (3) the Department of Labor to pay expenses in connection with continuing education programs and the purchase and sale of copies of the NC State Building Code; and (4) the Department of Labor to pay its expenses incurred in carrying out its powers and duties under Article 24 of GS Chapter 95. Makes other conforming changes.

Part III.

Makes conforming changes by changing references from the State Fire Marshal to the State Engineer, Department of Insurance to Department of Labor, from the Division of Engineer of the Department of Insurance to the Engineering and Building Codes Division of the Office, and similar changes in the following statutes: GS 143-137 (concerning the Building Code Council); GS 143-137.1 (concerning the Residential Code Council); GS 143-138 (concerning the North Carolina State Building Code); GS 143-138.1 (concerning instruction and commentaries on the NC State Building Code); GS 143-138 (enforcement of the North Carolina State Building Code); GS 143-139.4 (concerning certain building inspections); GS 143-140.1 (alternative design construction and methods); GS 143-141 (appeals to the Building Code Council and Residential Code Council); GS 143-143.4 (door lock exemption for certain businesses); and GS 143-143.7 (elevator safety requirements for certain residential rentals). Makes additional technical changes.

Specifies that the North Carolina State Building Code, and amendments to the Code adopted by the Building Code Council or Residential Code Council, or any enactment of the NCGA directing changes to the Code, in effect on July 1, 2026, are not affected by this act unless amended or repealed by the Building Code Council or Residential Code Council, as applicable.

Allows the current members of the Building Code Council and Residential Code Council to continue to serve until the expiration of their terms; upon expiration of terms of members affected by the transfer of jurisdiction requires a successor to be appointed in accordance with GS 143-136 and GS 143-136.1, as applicable.

Part IV.

Makes conforming changes by changing references from the State Fire Marshal to the State Engineer in the following statutes related to manufactured homes: GS 143-143.8 (set out the purpose of the statutes related to manufactured homes), GS 143-143.6 (defining Code), GS 143-143.10 (Manufactured Housing Board), GS 143-143.15 (manufactured homes setup), GS 143-143.54 (audits and records inspections), GS 143-146 (statement of policy), GS 143-148 (exclusion from coverage), GS 143-151 (penalties), GS 143-151.1 (enforcement of the Article), GS 143-151.2 (fees), GS 143-151.3 (reports), GS 143-151.4 (notification of defects and correction procedures), and GS 143-151.5 (prohibited acts).

Allows current members of the Manufactured Housing Board to continue to serve until expiration of their terms; requires upon expiration of the terms that the State Engineer appoint a successor in accordance with the provisions of GS 143-143.10, as amended by this act.

Specifies that the monitoring inspection fee under GS 143-151.2 is not affected by the act and remains in effect until amended by the State Engineer in an amount required by the Secretary of HUD.

Part V.

Makes conforming changes by changing references from the State Fire Marshal to the State Engineer, from the Office of the State Fire Marshal to the Office, from the Division of Engineer of the Department of Insurance to the Engineering and Building Codes Division of the Office, and similar changes in the following statutes: GS 143-151.8 (definitions of code and willful misconduct, gross negligence, or gross incompetence); GS 143-151.9 (North Carolina Code Official Qualifications Board); GS 143-151.12 (powers of the Board); GS 143-151.13 (standards and certificates for Code-enforcement officials); GS 143-151.19 (administration of the Article); and GS 143-151.21 (disposition of fees).

Allows current appointed members of the North Carolina Code Officials Qualification Board to continue to serve until the expiration of the member's term; upon expiration of terms, requires the State Engineer to appoint a successor as provided in amended GS 143-151.9.

Specifies that fees fixed for services performed by Code-enforcement officials under GS 143-151.12(9)a. affected by this act will not be affected until amended by the State Engineer under amended GS 143-151.12(9)a.

Part VI.  

Makes conforming changes by changing references from the State Fire Marshal to the State Engineer, from the Office of the State Fire Marshal to the Office, from the Division of Engineer of the Department of Insurance to the Engineering and Building Codes Division of the Office, and similar changes in the following statutes: GS 143-151.46 (North Carolina Home Inspector Licensure Board) and GS 143-151.63 (administration of the Article).

Part VII.

Makes conforming changes by changing references from the State Fire Marshal to the State Engineer, from the Office of the State Fire Marshal to the Office, from the Division of Engineer of the Department of Insurance to the Engineering and Building Codes Division of the Office, and similar changes in the following statutes: GS 160D-402 (administrative staff), GS 160D-910 (manufactured homes), GS 160D-1102 (building code administration), GS 160D-1114 (appeals of stop orders), GS 160D-1126 (records and reports), and GS 160D-1127 (appeals).

Part VIII.

Makes conforming changes by changing references from the State Fire Marshal to the State Engineer, from the Office of the State Fire Marshal to the Office, from the Division of Engineer of the Department of Insurance to the Engineering and Building Codes Division of the Office, and similar changes in the following statutes: GS 66-25 (acceptable listings as to safety of goods) and GS 115C-525 (fire prevention).

Part IX.

Provides that until the NCGA confirms an independent State Engineer, the State Fire Marsal will continue to have the same powers under Article 78A of GS Chapter 58 prior to the effective date of this act for the purposes of executing laws being assigned to the State Engineer and the Office by this act.

Requires employees of the Office of the State Fire Marshal affected by the transfer of a Board, Council, or Division to continue as employees of that Office at their option or until further action is taken by the Department of Labor to transfer employees from that Office. Continues programs and functions conducted by the Office of the State Fire Marshal without any reduction in funds, responsibilities, or administrative support until further action is taken to transfer programs and functions from the Office of the State Fire Marshal and in accordance with law.

Provides that no pending actions or proceedings brought by or against the Office of the State Fire Marshal or any Board, Council, or Division are affected by this act.  Allows any business or other matter undertaken or commanded by any program or contract by the Office of the State Fire Marshal or any Board, Council, or Division transferred by this act and pertaining to or connected with the functions, powers, obligations, and duties set forth herein, which are pending on July 1, 2026, to be conducted and completed in the same manner and under the same terms and conditions and with the same effect as if conducted and completed by the original program, the Office of the State Fire Marshal, or any Board, Council, or Division transferred by this act.

Specifies that the transfers under the act do not affect any ongoing investigation in effect on July 1, 2026, conducted by the Office of the State Fire Marshal, or any Board, Council, or Division enumerated in GS 95-280(b), as enacted by Section 1.1 of this act, and that prosecutions for offenses or violations committed before July 1, 2026, are not abated or affected by this act.

Specifies that the transfer does not affect any ongoing order in effect on July 1, 2026, and that rules and forms adopted by the Office of the State Fire Marshal, or any Board, Council, or Division in effect on July 1, 2026, remain in effect until amended or repealed by the responsible Board, Council, or Division.

Requires the Office of State Budget and Management to establish a new budget fund within the Department of Labor General Fund (Budget Code 13800), and transfer both of the following from the Office of the State Fire Marshal to the new fund: (1) all funds supporting the Office of Engineering and Codes and (2) all positions and associated costs in the Office.  

Requires the Office of State Budget and Management, in conjunction with the Office, to adjust the Office’s base budget for each year of the 2025-27 biennium to use proceeds from the insurance regulatory charge established under GS 58-6-25 to reimburse the General Fund.

Part X.

Includes a severability clause.

Makes the act effective July 1, 2026.