NORTH CAROLINA — A bill meant to provide recovery funds to victims of Hurricane Helene stirred controversy this week due to provisions enacting sweeping changes in state election authority. The 131-page bill also contains expansive revisions to environmental laws impacting hog waste production and Duke Energy oversight.
READ MORE: Utilities Commission approves Duke’s carbon plan ahead of schedule
The Senate passed SB 382 along party lines, 30-19, on Thursday. Republican legislators unveiled the surprise legislation an hour before the House held a contentious debate and voted to pass it Tuesday evening.
Critics, including Rep. Deb Butler (D-New Hanover), described it as a power grab designed to limit the authority of Democratic officials.
“It’s full of policy issues because they recognize they’ve got a Democratic governor and Democratic attorney general coming in,” she told Port City Daily. “They don’t like it, so they’re doing whatever they can in the eleventh hour to strip power from those positions.”
The bill’s wide-ranging provisions include transferring authority over State Board of Elections appointments from incoming Gov. Josh Stein — a Democrat — to Republican auditor Dave Boliek. Currently, the state board of elections chooses two representatives from each party to make up the county boards, while the governor appoints the fifth member. This bill changes it to give the auditor appointment authority of each county board’s chair.
The bill also removes the seats of two elected superior court justices who have ruled against GOP-backed election changes and creates two new judicial positions appointed by the general assembly.
“The bill is so offensive because we have people that really need financial help because of Helene,” Mary Maclean Asbill, director of the Southern Environmental Law Center’s North Carolina office, said.
Gov. Roy Cooper is expected to veto the bill next month before leaving office. Three Republican representatives from western North Carolina voted against it; if they don’t support an override, it is unlikely the General Assembly would have enough votes to enact the legislation.
SB 382 reduces some regulations for infrastructure recovery but does not provide immediate funding for western North Carolina. It transfers $227 million from the state’s savings reserve to its Helene fund but notes the resources shall remain unspent until further review by the General Assembly.
Asbill pointed to a provisional 90 pages as her foremost concern. The section would allow industrial hog waste producers to receive renewable energy credits for creating biogas facilities in economically distressed tier-one counties.
The facilities convert hog waste into natural gas. Supporters argue biogas provides a renewable, low-carbon fuel source and profitable method of waste management; critics contend biogas is primarily composed of methane and incentivizes hog facilities to maintain outdoor lagoon waste that contaminate surrounding areas.
SELC represented Cape Fear River Watch in a 2022 lawsuit challenging the Department of Environmental Quality’s biogas permits for failing to protect surrounding communities from waste pollution. The nonprofit requested the Office of Administrative Hearings require pork producers to implement feasible treatment and disposal methods with the least adverse impact on the environment.
A 2007 state law requires 12.5% of North Carolina’s energy to come from renewable sources starting in 2021. Smithfield — the state’s largest pork producer — partners with Duke Energy, North Carolina’s investor-owned monopoly utility, on state biogas projects. The company buys renewable energy credits from producers to meet legal requirements.
“This bill provision appears to be a fast-tracked way for monopoly utilities to meet Renewable Energy Portfolio Standard hog waste to energy compliance goals,” SELC spokesperson Kathleen Sullivan wrote in a statement.
Chief administrative judge Donald van der Vaart dismissed Cape Fear River Watch’s suit in favor of DEQ and Murphy-Brown — a Smithfield subsidiary — last year.
Van der Vaart’s wife, Sandra, has been a board member of the NC Chamber Legal Institute since 2022 and currently serves as its chair. Smithfield is a “pinnacle” member, or highest paying contributor, of the NC Chamber. The NC Chamber legal Institute filed briefs in support of Murphy-Brown in 2018 and a brief in support of the National Pork Producers Council, a lobby group that includes Murphy-Brown, in 2023 for separate litigation.
Duke University director of environmental law Ryke Longest described the appointed chief administrative judge’s marriage to the chair of a lobbying organization as particularly concerning. Lower administrative judges can ameliorate potential conflicts of interest by excusing themselves from cases, he said, but the chief administrative judge has broader oversight of the entire agency.
“If there was a conflict [in a case] then that could easily be moved to another judge,” he told Port City Daily in September. “Then you could say, ‘We now have a fresh judge who is not married to a person who is intensely interested in the outcome of this litigation. That would be a different situation. But the chief administrative law judge has additional powers.”
Longest expressed broader concerns about partisanship among appointed officials in the Office of Administrative Hearings, a quasi-judicial agency meant to provide impartial resolution of administrative disputes.
The new bill, SB 382, allocates $250,000 to cover the Office of Administrative Hearings’ legal expenses used for outside counsel after facing multiple lawsuits from other state agencies. The bill specifies the funds will go to the Rules Review Commission, an agency within OAH entirely appointed by the General Assembly.
The Rules Review Commission has at least four in-house staff attorneys but retained outside counsel after being sued in recent years by the Environmental Management Commission and Coastal Resources Commission.
Attorney General Josh Stein represented the Environmental Management Commission and Coastal Resources Commission in both cases against the Rules Review Commission to argue it acted outside of its authority in rejecting proposed environmental regulations.
“[The Rules Review Commission] keeps raising objections and denying rules that it doesn’t have statutory authority over,” Asbill said. “That’s why it’s getting sued. It’s just kind of pathetic that it’s getting money for outside counsel to defend itself from illegal actions.”
SB 382 would significantly limit the powers of incoming Democratic Attorney General Jeff Jackson. It bans the attorney general from taking legal positions for North Carolina that are inconsistent with General Assembly leaders, including the senate president and house speaker. It also deletes from state statute a provision granting the attorney general authority to appear before agencies in proceedings on behalf of the state.
“It’s hamstringing our state from weighing in on environmental cases,” Asbill said.
The bill also reduces the attorney general’s ability to intervene in issues involving the Utilities Commission, the agency charged with oversight of Duke’s proposed rate hikes and energy investments. Under the new law, Jackson would need to file a petition to intervene in cases that can be rejected by the Utilities Commission. The attorney general’s office previously could automatically intervene and request information from the agency.
Stein’s office repeatedly intervened in Utilities Commission proceedings to challenge Duke’s proposed rate hikes, advocate the utility increase investment in renewables, and reduce carbon emissions. For example, consultant Edward Burgess submitted a brief on behalf of Stein earlier this year arguing Duke had delayed its carbon reduction goal to prioritize expensive new gas and nuclear infrastructure above cost-effective alternatives.
The new law would strip Stein’s majority appointment authority of the Utilities Commission. The governor has appointed the majority of the Utilities Commission, including its chair, for years. SB 382 would shift the Utilities Commission to a five-member body with two governor appointments, two General Assembly appointments, and an appointment by the state treasurer.
Port City Daily reached out to Republican Brad Briner — who will take over as state treasurer in January — to ask his views on state energy policy, rate hikes, and the impact of the return on equity regulatory model on Duke’s investment decisions but did not receive a response by press.
Asbill raised concerns giving utility oversight authority to the treasurer could present conflicts of interest. The treasurer’s office is responsible for managing the state’s investments, which could be impacted by the Utility Commission’s energy policy and carbon reduction regulations. Briner has advocated greater investment in fossil fuel resources and holds stock in oil and gas infrastructure, exploration, and investment firms including Energy Transfer, Spur Energy, and EMG Fund, according to his 2024 statement of economic interest.
“As a fiduciary, you want to be in a traditional energy business,” Briner said in a February interview about North Carolina’s pension policy with Institutional Investor.
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