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Joseph J. DeLuca, Jr. Commission Counsel

RRC STAFF OPINION

PLEASE NOTE: THIS COMMUNICATION IS EITHER 1) ONLY THE RECOMMENDATION OF AN RRC

STAFF ATTORNEY AS TO ACTION THAT THE ATTORNEY BELIEVES THE COMMISSION SHOULD TAKE ON

THE CITED RULE AT ITS NEXT MEETING, OR 2) AN OPINION OF THAT ATTORNEY AS TO SOME MATTER

CONCERNING THAT RULE. THE AGENCY AND MEMBERS OF THE PUBLIC ARE INVITED TO SUBMIT THEIR

OWN COMMENTS AND RECOMMENDATIONS (ACCORDING TO RRC RULES) TO THE COMMISSION.

AGENCY: N.C. ALCOHOLIC BEVERAGE CONTROL COMMISSION RULE CITATION: 4 NCAC 2R .0103 RECOMMENDED ACTION:

Approve, but note staff’s comment

X Object, based on:

X Lack of statutory authority

X Unclear or ambiguous

Unnecessary

Failure to adopt the rule in accordance with the APA

Extend the period of review

Return the rule to the agency for failure to comply with the Administrative Procedure Act

COMMENT:

There is no authority for the agency to adopt the definition for “aggrieved party” in (a)(3). The General Assembly has already defined “person aggrieved” in the Administrative Procedure Act (APA) and the agency has not cited any authority for adopting a definition that might conflict with the statutory definition. To the extent that there might be any conflict in the definitions, this conflict could arise in the conduct of a contested case hearing.

Even if there were authority to adopt the rule it is unclear which definition, the agency’s or the statutory definition, would apply in the case of a contested case hearing which would be conducted under the APA and the rules of the Office of Administrative Hearings.

Joseph J. DeLuca, Jr. Commission Counsel

RRC STAFF OPINION

PLEASE NOTE: THIS COMMUNICATION IS EITHER 1) ONLY THE RECOMMENDATION OF AN RRC

STAFF ATTORNEY AS TO ACTION THAT THE ATTORNEY BELIEVES THE COMMISSION SHOULD TAKE ON

THE CITED RULE AT ITS NEXT MEETING, OR 2) AN OPINION OF THAT ATTORNEY AS TO SOME MATTER

CONCERNING THAT RULE. THE AGENCY AND MEMBERS OF THE PUBLIC ARE INVITED TO SUBMIT THEIR

OWN COMMENTS AND RECOMMENDATIONS (ACCORDING TO RRC RULES) TO THE COMMISSION.

AGENCY: N.C. ALCOHOLIC BEVERAGE CONTROL COMMISSION RULE CITATION: 4 NCAC 2R .0701 RECOMMENDED ACTION:

Approve, but note staff’s comment

X Object, based on:

X Lack of statutory authority

Unclear or ambiguous

Unnecessary

Failure to adopt the rule in accordance with the APA

Extend the period of review

Return the rule to the agency for failure to comply with the Administrative Procedure Act

COMMENT:

There is no authority cited to enlarge the restrictions pertaining to familial conflicts of interest, as set in (b) beyond the first degree.

NCGS 104A-1describes the procedure for counting the degrees of kinship:

§ 104A-1. Degrees of kinship; how computed.

In all cases where degrees of kinship are to be computed, the same shall be computed in

accordance with the civil law rule, as follows:

(1) The degrees of lineal kinship of two persons is computed by counting one

degree for each person in the line of ascent or descent, exclusive of the

person from whom the computing begins; and

(2) The degree of collateral kinship of two persons is computed by commencing

with one of the persons and ascending from him to a common ancestor,

descending from that ancestor to the other person, and counting one degree

for each person in the line of ascent and in the line of descent, exclusive of

the person from whom the computation begins, the total to represent the

degree of such kinship. (1951, c. 315; 1953, c. 1077, s. 2.)

Joseph J. DeLuca, Jr. Commission Counsel

Under the procedure set out in (2) for determining the degree of kinship for a cousin, which is a collateral relationship, the common ancestor would be a grandparent which is two steps or degrees. It would then be another two steps or degrees to count down to the cousin, which would make the cousin a fourth degree relation and outside the prohibition contained in paragraph (a) of the statute cited as authority:

§ 18B-201. Conflict of interest.

(a) Financial Interests Restricted. – No person shall be appointed to or employed by the

Commission, a local board, or the ALE Division if that person or a member of that person's

family related to that person by blood or marriage to the first degree has or controls, directly or

indirectly, a financial interest in any commercial alcoholic beverage enterprise, including any

business required to have an ABC permit. The Commission may exempt from this provision any

person, other than a Commission member, when the financial interest in question is so

insignificant or remote that it is unlikely to affect the person's official actions in any way.

Exemptions may be granted only to individuals, not to groups or classes of people, and each

exemption shall be in writing, be available for public inspection, and contain a statement of the

financial interest in question.

(b) Self-dealing. – The provisions of G.S. 14-234 shall apply to the Commission and

local boards.

(c) Dealing for Family Members. – Neither the Commission nor any local board shall

contract or otherwise deal in any business matter so that a member's spouse or any person related

to him by blood to a degree of first cousin or closer in any way benefits, directly or indirectly,

from the transaction unless:

(1) The member whose relative benefits from the transaction abstains from

participating in any way, including voting, in the decision;

(2) The minutes of the meeting at which the final decision is reached specifically

note the member whose spouse or relative is benefited and the amount

involved in each transaction;

(3) The next annual audit of the Commission or local board specifically notes the

member and the amount involved in each transaction occurring during the

year covered by the audit; and

(4) If the transaction is by a local board, the Commission is notified at least two

weeks before final board approval of the transaction. (1981, c. 412, s. 2;

1993, c. 415, s. 4.)

Paragraph (c) which prohibits business dealings involving first cousins applies only to ABC Commission or local board members and not to any “employee of the Commission” referred to in (a). It also seems to me, although it is not necessary for the purposes of this opinion that the employment prohibition in NCGS 18B-201 (a) probably applies to the initial hiring decision, rather than to continuing employment. Otherwise you could have a situation where a long-time warehouse worker or counter salesperson should be terminated because a parent or child (or spouse of one of them) obtains a job driving a delivery route for a distributor or even starts operating a restaurant, bar or grocery store with ABC permits.

Joseph J. DeLuca, Jr. Commission Counsel

RRC STAFF OPINION

PLEASE NOTE: THIS COMMUNICATION IS EITHER 1) ONLY THE RECOMMENDATION OF AN RRC

STAFF ATTORNEY AS TO ACTION THAT THE ATTORNEY BELIEVES THE COMMISSION SHOULD TAKE ON

THE CITED RULE AT ITS NEXT MEETING, OR 2) AN OPINION OF THAT ATTORNEY AS TO SOME MATTER

CONCERNING THAT RULE. THE AGENCY AND MEMBERS OF THE PUBLIC ARE INVITED TO SUBMIT THEIR

OWN COMMENTS AND RECOMMENDATIONS (ACCORDING TO RRC RULES) TO THE COMMISSION.

AGENCY: N.C. ALCOHOLIC BEVERAGE CONTROL COMMISSION RULE CITATION: 4 NCAC 2R .0905 RECOMMENDED ACTION:

Approve, but note staff’s comment

X Object, based on:

X Lack of statutory authority

X Unclear or ambiguous

Unnecessary

Failure to adopt the rule in accordance with the APA

Extend the period of review

Return the rule to the agency for failure to comply with the Administrative Procedure Act

COMMENT:

This rule sets deposit requirements for local boards. The last paragraph contains a provision for altering or waiving these requirements. However the guideline “for good cause shown” is not the “specific guideline” required by the Administrative Procedure Act (APA), NCGS 150B-19(6). It is unclear what constitutes “good cause” in the context of this rule.

The other guideline, “where adequate security for the funds involved is demonstrated” is sufficiently specific.

Joseph J. DeLuca, Jr. Commission Counsel

RRC STAFF OPINION

PLEASE NOTE: THIS COMMUNICATION IS EITHER 1) ONLY THE RECOMMENDATION OF AN RRC

STAFF ATTORNEY AS TO ACTION THAT THE ATTORNEY BELIEVES THE COMMISSION SHOULD TAKE ON

THE CITED RULE AT ITS NEXT MEETING, OR 2) AN OPINION OF THAT ATTORNEY AS TO SOME MATTER

CONCERNING THAT RULE. THE AGENCY AND MEMBERS OF THE PUBLIC ARE INVITED TO SUBMIT THEIR

OWN COMMENTS AND RECOMMENDATIONS (ACCORDING TO RRC RULES) TO THE COMMISSION.

AGENCY: N.C. ALCOHOLIC BEVERAGE CONTROL COMMISSION RULE CITATION: 4 NCAC 2R .1008 RECOMMENDED ACTION:

Approve, but note staff’s comment

X Object, based on:

X Lack of statutory authority

X Unclear or ambiguous

Unnecessary

Failure to adopt the rule in accordance with the APA

Extend the period of review

Return the rule to the agency for failure to comply with the Administrative Procedure Act

COMMENT:

In (a) line 4 it is unclear what constitutes a “direct or indirect” interest. For example does it constitute such an interest to own stock of whatever amount or control in a spirituous liquor company or company that engages in any of the cited activities? Would it constitute a violation of this rule to work, even limited hours, in such a company while also working for a local board, such as being a waiter or bartender in a restaurant selling such beverages?

For the same reasons as cited in the opinion concerning 2R .0701, staff believes that the employment prohibition in (b) extending to first cousins is not authorized.

Even if the Commission had authority to make an employment prohibition extending as far as first cousins there is no authority cited for the additional provision in (b) extending that prohibition to a person related not to a local board member but to a “member of any other authority that appoints members of the local board.”

Joseph J. DeLuca, Jr. Commission Counsel

§ 14-234. Public officers or employees benefiting from public contracts; exceptions.

(a) (1) No public officer or employee who is involved in making or administering a contract

on behalf of a public agency may derive a direct benefit from the contract except as

provided in this section, or as otherwise allowed by law.

(2) A public officer or employee who will derive a direct benefit from a contract with the

public agency he or she serves, but who is not involved in making or administering

the contract, shall not attempt to influence any other person who is involved in

making or administering the contract.

(3) No public officer or employee may solicit or receive any gift, reward, or promise of

reward in exchange for recommending, influencing, or attempting to influence the

award of a contract by the public agency he or she serves.

(a1) For purposes of this section:

(1) As used in this section, the term "public officer" means an individual who is elected

or appointed to serve or represent a public agency, other than an employee or

independent contractor of a public agency.

(2) A public officer or employee is involved in administering a contract if he or she

oversees the performance of the contract or has authority to make decisions regarding

the contract or to interpret the contract.

(3) A public officer or employee is involved in making a contract if he or she participates

in the development of specifications or terms or in the preparation or award of the

contract. A public officer is also involved in making a contract if the board,

commission, or other body of which he or she is a member takes action on the

contract, whether or not the public officer actually participates in that action, unless

the contract is approved under an exception to this section under which the public

officer is allowed to benefit and is prohibited from voting.

(4) A public officer or employee derives a direct benefit from a contract if the person or

his or her spouse: (i) has more than a ten percent (10%) ownership or other interest in

an entity that is a party to the contract; (ii) derives any income or commission directly

from the contract; or (iii) acquires property under the contract.

(5) A public officer or employee is not involved in making or administering a contract

solely because of the performance of ministerial duties related to the contract.

(b) Subdivision (a)(1) of this section does not apply to any of the following:

(1) Any contract between a public agency and a bank, banking institution, savings and

loan association, or with a public utility regulated under the provisions of Chapter 62

of the General Statutes.

(2) An interest in property conveyed by an officer or employee of a public agency under

a judgment, including a consent judgment, entered by a superior court judge in a

condemnation proceeding initiated by the public agency.

(3) Any employment relationship between a public agency and the spouse of a public

officer of the agency.

(4) Remuneration from a public agency for services, facilities, or supplies furnished

directly to needy individuals by a public officer or employee of the agency under any

program of direct public assistance being rendered under the laws of this State or the

United States to needy persons administered in whole or in part by the agency if: (i)

the programs of public assistance to needy persons are open to general participation

on a nondiscriminatory basis to the practitioners of any given profession, professions

or occupation; (ii) neither the agency nor any of its employees or agents, have control

over who, among licensed or qualified providers, shall be selected by the

beneficiaries of the assistance; (iii) the remuneration for the services, facilities or

supplies are in the same amount as would be paid to any other provider; and (iv)

although the public officer or employee may participate in making determinations of

Joseph J. DeLuca, Jr. Commission Counsel

eligibility of needy persons to receive the assistance, he or she takes no part in

approving his or her own bill or claim for remuneration.

(b1) No public officer who will derive a direct benefit from a contract entered into under

subsection (b) of this section may deliberate or vote on the contract or attempt to influence any other

person who is involved in making or administering the contract.

(c) through (d) Repealed by Session Laws 2001-409, s. 1, effective July 1, 2002.

(d1) Subdivision (a)(1) of this section does not apply to (i) any elected official or person appointed

to fill an elective office of a village, town, or city having a population of no more than 15,000 according

to the most recent official federal census, (ii) any elected official or person appointed to fill an elective

office of a county within which there is located no village, town, or city with a population of more than

15,000 according to the most recent official federal census, (iii) any elected official or person appointed to

fill an elective office on a city board of education in a city having a population of no more than 15,000

according to the most recent official federal census, (iv) any elected official or person appointed to fill an

elective office as a member of a county board of education in a county within which there is located no

village, town or city with a population of more than 15,000 according to the most recent official federal

census, (v) any physician, pharmacist, dentist, optometrist, veterinarian, or nurse appointed to a county

social services board, local health board, or area mental health, developmental disabilities, and substance

abuse board serving one or more counties within which there is located no village, town, or city with a

population of more than 15,000 according to the most recent official federal census, and (vi) any member

of the board of directors of a public hospital if all of the following apply:

(1) The undertaking or contract or series of undertakings or contracts between the village,

town, city, county, county social services board, county or city board of education,

local health board or area mental health, developmental disabilities, and substance

abuse board, or public hospital and one of its officials is approved by specific

resolution of the governing body adopted in an open and public meeting, and

recorded in its minutes and the amount does not exceed twenty thousand dollars

($20,000) for medically related services and forty thousand dollars ($40,000) for

other goods or services within a 12-month period.

(2) The official entering into the contract with the unit or agency does not participate in

any way or vote.

(3) The total annual amount of contracts with each official, shall be specifically noted in

the audited annual financial statement of the village, town, city, or county.

(4) The governing board of any village, town, city, county, county social services board,

county or city board of education, local health board, area mental health,

developmental disabilities, and substance abuse board, or public hospital which

contracts with any of the officials of their governmental unit shall post in a

conspicuous place in its village, town, or city hall, or courthouse, as the case may be,

a list of all such officials with whom such contracts have been made, briefly

describing the subject matter of the undertakings or contracts and showing their total

amounts; this list shall cover the preceding 12 months and shall be brought up-to-date

at least quarterly.

(d2) Subsection (d1) of this section does not apply to contracts that are subject to Article 8 of

Chapter 143 of the General Statutes, Public Building Contracts.

(d3) Subsection (a) of this section does not apply to an application for or the receipt of a grant

under the Agriculture Cost Share Program for Nonpoint Source Pollution Control created pursuant to Part

9 of Article 21 of Chapter 143 of the General Statutes or the Community Conservation Assistance

Program created pursuant to Part 11 of Article 21 of Chapter 143 of the General Statutes by a member of

the Soil and Water Conservation Commission if the requirements of G.S. 139-4(e) are met, and does not

apply to a district supervisor of a soil and water conservation district if the requirements of G.S. 139-8(b)

are met.

(d4) Subsection (a) of this section does not apply to an application for, or the receipt of a grant or

other financial assistance from, the Tobacco Trust Fund created under Article 75 of Chapter 143 of the

Joseph J. DeLuca, Jr. Commission Counsel

General Statutes by a member of the Tobacco Trust Fund Commission or an entity in which a member of

the Commission has an interest provided that the requirements of G.S. 143-717(h) are met.

(d5) This section does not apply to a public hospital subject to G.S. 131E-14.2 or a public hospital

authority subject to G.S. 131E-21.

(d6) This section does not apply to employment contracts between the State Board of Education

and its chief executive officer.

(e) Anyone violating this section shall be guilty of a Class 1 misdemeanor.

(f) A contract entered into in violation of this section is void. A contract that is void under this

section may continue in effect until an alternative can be arranged when: (i) immediate termination would

result in harm to the public health or welfare, and (ii) the continuation is approved as provided in this

subsection. A public agency that is a party to the contract may request approval to continue contracts

under this subsection as follows:

(1) Local governments, as defined in G.S. 159-7(15), public authorities, as defined in

G.S. 159-7(10), local school administrative units, and community colleges may

request approval from the chair of the Local Government Commission.

(2) All other public agencies may request approval from the State Director of the Budget.

Approval of continuation of contracts under this subsection shall be given for the minimum period

necessary to protect the public health or welfare. (1825, c. 1269, P.R.; 1826, c. 29; R.C., c. 34, s. 38; Code, s. 1011;

Rev., s. 3572; C.S., s. 4388; 1929, c. 19, s. 1; 1969, c. 1027; 1975, c. 409; 1977, cc. 240, 761; 1979, c. 720; 1981, c. 103, ss. 1, 2,

5; 1983, c. 544, ss. 1, 2; 1985, c. 190; 1987, c. 570; 1989, c. 231; 1991 (Reg. Sess., 1992), c. 1030, s. 5; 1993, c. 539, s. 145;

1994, Ex. Sess., c. 24, s. 14(c); 1995, c. 519, s. 4; 2000-147, s. 6; 2001-409, s. 1; 2001-487, ss. 44(a), 44(b), 45; 2002-159, s. 28;

2006-78, s. 2; 2009-2, s. 2; 2009-226, s. 1.)

§ 18B-201. Conflict of interest.

(a) Financial Interests Restricted. – No person shall be appointed to or employed by the

Commission, a local board, or the ALE Division if that person or a member of that person's family related

to that person by blood or marriage to the first degree has or controls, directly or indirectly, a financial

interest in any commercial alcoholic beverage enterprise, including any business required to have an ABC

permit. The Commission may exempt from this provision any person, other than a Commission member,

when the financial interest in question is so insignificant or remote that it is unlikely to affect the person's

official actions in any way. Exemptions may be granted only to individuals, not to groups or classes of

people, and each exemption shall be in writing, be available for public inspection, and contain a statement

of the financial interest in question.

(b) Self-dealing. – The provisions of G.S. 14-234 shall apply to the Commission and local

boards.

(c) Dealing for Family Members. – Neither the Commission nor any local board shall contract or

otherwise deal in any business matter so that a member's spouse or any person related to him by blood to

a degree of first cousin or closer in any way benefits, directly or indirectly, from the transaction unless:

(1) The member whose relative benefits from the transaction abstains from participating

in any way, including voting, in the decision;

(2) The minutes of the meeting at which the final decision is reached specifically note the

member whose spouse or relative is benefited and the amount involved in each

transaction;

(3) The next annual audit of the Commission or local board specifically notes the

member and the amount involved in each transaction occurring during the year

covered by the audit; and

(4) If the transaction is by a local board, the Commission is notified at least two weeks

before final board approval of the transaction. (1981, c. 412, s. 2; 1993, c. 415, s. 4.)

§ 18B-207. Rules.

The Commission shall have authority to adopt, amend, and repeal rules to carry out the provisions of

this Chapter. Those rules shall become effective when adopted and filed pursuant to the provisions of

Joseph J. DeLuca, Jr. Commission Counsel

Chapter 150B of the General Statutes. (1937, c. 49, s. 4; cc. 237, 411; 1945, c. 954; 1949, c. 974, s. 9; 1961, c. 956;

1963, c. 426, s. 12; c. 916, s. 2; c. 1119, s. 1; 1965, c. 1063; c. 1102, s. 3; 1967, c. 222, s. 2; c. 1240, s. 1; 1971, c. 872, s. 1; 1973,

c. 28; c. 473, s. 1; c. 476, s. 133; c. 606; c. 1288, s. 1; cc. 1369, 1396; 1975, cc. 240, 453, 640; 1977, c. 70, ss. 15.1, 15.2, 16; c.

176, ss. 2, 6; 1977, 2nd Sess., c. 1138, ss. 3, 4, 18; 1979, c. 384, s. 1; c. 445, s. 5; c. 482; c. 801, s. 4; 1981, c. 412, s. 2; 1987, c.

827, s.1.)

§ 18B-700. Appointment and organization of local ABC boards.

(a) Membership. – A local ABC board shall consist of three members appointed for three-year

terms, unless a different membership or term is provided by a local act enacted before the effective date

of this Chapter, or unless the board is a board for a merged ABC system under G.S. 18B-703 and a

different size membership has been provided for as part of the negotiated merger. One member of the

initial board of a newly created ABC system shall be appointed for a three-year term, one member for a

two-year term, and one member for a one-year term. As the terms of initial board members expire, their

successors shall each be appointed for three-year terms. The appointing authority shall designate one

member of the local board as chairman.

(b) City Boards. – City ABC board members shall be appointed by the city governing body,

unless a different method of appointment is provided in a local act enacted before the effective date of this

Chapter.

(c) County Boards. – County ABC board members shall be appointed by the board of county

commissioners, unless a different method of appointment is provided in a local act enacted before the

effective date of this Chapter.

(d) Qualifications. – The appointing authority shall appoint members of a local board on the basis

of the appointees' interest in public affairs, good judgment, knowledge, ability, and good moral character.

(e) Vacancy. – A vacancy on a local board shall be filled by the appointing authority for the

remainder of the unexpired term. If the chairman's seat becomes vacant, the appointing authority may

designate either the new member or an existing member of the local board to complete the chairman's

term.

(f) Removal. – A member of a local board may be removed for cause at any time by the

appointing authority. Local board members are subject to the removal provisions of G.S. 18B-202.

(g) Salary. – A local board member may be compensated as determined by the appointing

authority.

(h) Conflict of Interest. – The provisions of G.S. 18B-201 shall apply to local board members and

employees.

(i) Bond. – Each local board member shall be bonded in an amount not less than five thousand

dollars ($5,000), secured by a corporate surety, for the faithful performance of his duties. A public

employees' blanket position bond in the required amount satisfies the requirements of this subsection. The

bond shall be payable to the local board and shall be approved by the appointing authority for the local

board. The appointing authority may exempt from this bond requirement any board member who does not

handle board funds, and it may also increase the amount of the bond for any member who does handle

board funds.

(j) Limited Liability. – A person serving as a member of a local ABC board shall be immune

individually from civil liability for monetary damages, except to the extent covered by insurance, for any

act or failure to act arising out of this service, except where the person:

(1) Was not acting within the scope of his official duties;

(2) Was not acting in good faith;

(3) Committed gross negligence or willful or wanton misconduct that resulted in the

damage or injury;

(4) Derived an improper personal financial benefit from the transaction; or

(5) Incurred the liability from the operation of a motor vehicle.

The immunity in this subsection is personal to the members of local ABC boards, and does not immunize

the local ABC board for liability for the acts or omissions of the members of the local ABC board. (1981, c.

412, s. 2; c. 747, s. 50; 1981 (Reg. Sess., 1982), c. 1262, s. 10; 1989, c. 800, s. 19.)

Joseph J. DeLuca, Jr. Commission Counsel

RRC STAFF OPINION

PLEASE NOTE: THIS COMMUNICATION IS EITHER 1) ONLY THE RECOMMENDATION OF AN RRC

STAFF ATTORNEY AS TO ACTION THAT THE ATTORNEY BELIEVES THE COMMISSION SHOULD TAKE ON

THE CITED RULE AT ITS NEXT MEETING, OR 2) AN OPINION OF THAT ATTORNEY AS TO SOME MATTER

CONCERNING THAT RULE. THE AGENCY AND MEMBERS OF THE PUBLIC ARE INVITED TO SUBMIT THEIR

OWN COMMENTS AND RECOMMENDATIONS (ACCORDING TO RRC RULES) TO THE COMMISSION.

AGENCY: N.C. ALCOHOLIC BEVERAGE CONTROL COMMISSION RULE CITATION: 4 NCAC 2R .1502 RECOMMENDED ACTION:

Approve, but note staff’s comment

X Object, based on:

X Lack of statutory authority

Unclear or ambiguous

Unnecessary

Failure to adopt the rule in accordance with the APA

Extend the period of review

Return the rule to the agency for failure to comply with the Administrative Procedure Act

COMMENT:

There is no authority cited for the markup price or formula as set out in (a) lines 4 - 6 to be “determined by the [ABC] Commission” outside rulemaking.

Joseph J. DeLuca, Jr. Commission Counsel

§ 18B-203. Powers and duties of the Commission.

(a) Powers. – The Commission shall have authority to:

(1) Administer the ABC laws;

(2) Provide for enforcement of the ABC laws, in conjunction with the ALE Division;

(3) Set the prices of alcoholic beverages sold in local ABC stores as provided in Article

8;

(4) Require reports and audits from local boards as provided in G.S. 18B-205;

(5) Determine what brands of alcoholic beverages may be sold in this State;

(6) Contract for State ABC warehousing, as provided in G.S. 18B-204;

(7) Dispose of damaged alcoholic beverages, as provided in G.S. 18B-806;

(8) Remove for cause any member or employee of a local board;

(9) Supervise or disapprove purchasing by any local board and inspect all records of

purchases by local boards;

(10) Approve or disapprove rules adopted by any local board;

(11) Approve or disapprove the opening and location of ABC stores, as provided in

Article 8;

(12) Issue ABC permits, and impose sanctions against permittees;

(13) Provide for the testing of alcoholic beverages, as provided in G.S. 18B-206;

(14) Fix the amount of bailment charges and bailment surcharges to be assessed on liquor

shipped from a Commission warehouse;

(15) Collect bailment charges and bailment surcharges from local boards;

(16) Notwithstanding any law to the contrary, enter into contracts for design and

construction of a warehouse or warehouses and supervise work and materials used in

the construction, as provided in G.S. 18B-204;

(17) Provide for the distribution of spirituous liquor to armed forces installations within

this State for resale on the installation;

(18) Provide for the distribution and posting of warning signs to local ABC boards

regarding the dangers of alcohol consumption during pregnancy as required under

G.S. 18B-808;

(19) Recognize the holder of a wine importer permit or nonresident wine vendor permit as

a primary American source of supply for the wine of a winery. To be considered a

primary American source of supply, a wine importer must establish that it has

lawfully purchased the wine from the winery, or from an agent of the winery, and by

written contract or otherwise has been authorized by the winery to distribute the wine

to wholesalers in the United States.

(b) Implied Powers. – The Commission shall have all other powers which may be reasonably

implied from the granting of the express powers stated in subsection (a), or which may be incidental to, or

convenient for, performing the duties given to the Commission. (1937, c. 49, s. 4; cc. 237, 411; 1945, c.

954; 1949, c. 974, s. 9; 1961, c. 956; 1963, c. 426, s. 12; c. 916, s. 2; c. 1119, s. 1; 1965, c. 1063; c. 1102,

s. 3; 1967, c. 222, s. 2; c. 1240, s. 1; 1971, c. 872, s. 1; 1973, c. 28; c. 473, s. 1; c. 476, s. 133; c. 606; c.

1288, s. 1; cc. 1369, 1396; 1975, cc. 240, 453, 640; 1977, c. 70, ss. 15.1, 15.2, 16; c. 176, ss. 2, 6; 1977,

2nd Sess., c. 1138, ss. 3, 4, 18; 1979, c. 384, s. 1; c. 445, s. 5; c. 482; c. 801, s. 4; 1981, c. 412, s. 2; c.

747, s. 38; 1981 (Reg. Sess., 1982), c. 1285, s. 2; 1987, c. 136, s. 1; 2003-339, s. 1; 2006-227, s. 10.)

§ 18B-207. Rules.

The Commission shall have authority to adopt, amend, and repeal rules to carry out the provisions of

this Chapter. Those rules shall become effective when adopted and filed pursuant to the provisions of

Chapter 150B of the General Statutes. (1937, c. 49, s. 4; cc. 237, 411; 1945, c. 954; 1949, c. 974, s. 9;

1961, c. 956; 1963, c. 426, s. 12; c. 916, s. 2; c. 1119, s. 1; 1965, c. 1063; c. 1102, s. 3; 1967, c. 222, s. 2;

c. 1240, s. 1; 1971, c. 872, s. 1; 1973, c. 28; c. 473, s. 1; c. 476, s. 133; c. 606; c. 1288, s. 1; cc. 1369,

Joseph J. DeLuca, Jr. Commission Counsel

1396; 1975, cc. 240, 453, 640; 1977, c. 70, ss. 15.1, 15.2, 16; c. 176, ss. 2, 6; 1977, 2nd Sess., c. 1138, ss.

3, 4, 18; 1979, c. 384, s. 1; c. 445, s. 5; c. 482; c. 801, s. 4; 1981, c. 412, s. 2; 1987, c. 827, s.1.)

§ 18B-804. Alcoholic beverage pricing.

(a) Uniform Price of Spirituous Liquor. – The retail price of spirituous liquor sold in ABC stores

shall be uniform throughout the State, unless otherwise provided by the ABC law.

(b) Sale Price of Spirituous Liquor. – The sale of spirituous liquor sold at the uniform State price

shall consist of the following components:

(1) The distiller's price.

(2) The freight and bailment charges of the State warehouse as determined by the

Commission.

(3) A markup for local boards as determined by the Commission.

(4) The tax levied under G.S. 105-113.80(c), which shall be levied on the sum of

subdivisions (1), (2), and (3).

(5) An additional markup for local boards equal to three and one-half percent (3 1/2%) of

the sum of subdivisions (1), (2), and (3).

(6) A bottle charge of one cent (1¢) on each bottle containing 50 milliliters or less and

five cents (5¢) on each bottle containing more than 50 milliliters.

(6a) The bailment surcharge.

(6b) An additional bottle charge for local boards of one cent (1¢) on each bottle containing

50 milliliters or less and five cents (5¢) on each bottle containing more than 50

milliliters.

(7) A rounding adjustment, the formula of which may be determined by the Commission,

so that the sale price will be divisible by five.

(8) If the spirituous liquor is sold to a mixed beverage permittee for resale in mixed

beverages, a charge of twenty dollars ($20.00) on each four liters and a proportional

sum on lesser quantities.

(9) If the spirituous liquor is sold to a guest room cabinet permittee for resale, a charge of

twenty dollars ($20.00) on each four liters and a proportional sum on lesser

quantities.

(c) Sale Price of Fortified Wine. – The sale price of fortified wine shall include the tax levied by

G.S. 105-113.80(b), as well as State and local sales taxes.

(d) Repealed by Session Laws 1985, c. 59, s. 2. (1937, c. 49, s. 4; cc. 237, 411; 1945, c. 954;

1949, c. 974, s. 9; 1961, c. 956; 1963, c. 426, s. 12; c. 916, s. 2; c. 1119, s. 1; 1965, c. 1063; c. 1102, s. 3;

1967, c. 222, s. 2; c. 1240, s. 1; 1971, c. 872, s. 1; 1973, c. 28; c. 473, s. 1; c. 476, s. 133; c. 606; c. 1288,

s. 1; cc. 1369, 1396; 1975, cc. 240, 453, 640; 1977, c. 70, ss. 15.1, 15.2, 16; c. 176, ss. 2, 6; 1977, 2nd

Sess., c. 1138, ss. 3, 4, 18; 1979, c. 384, s. 1; c. 445, s. 5; c. 482; c. 801, s. 4; 1981, c. 412, s. 2; 1981

(Reg. Sess., 1982), c. 1285, s. 5; 1983, c. 713, ss. 100, 101; 1985, c. 59, s. 2; c. 68, s. 1; c. 114, ss. 7-9;

1991, c. 565, ss. 4, 7; c. 689, ss. 304, 305; 1991 (Reg. Sess., 1992), c. 920, s. 3.)

Joseph J. DeLuca, Jr. Commission Counsel

RRC STAFF OPINION

PLEASE NOTE: THIS COMMUNICATION IS EITHER 1) ONLY THE RECOMMENDATION OF AN RRC

STAFF ATTORNEY AS TO ACTION THAT THE ATTORNEY BELIEVES THE COMMISSION SHOULD TAKE ON

THE CITED RULE AT ITS NEXT MEETING, OR 2) AN OPINION OF THAT ATTORNEY AS TO SOME MATTER

CONCERNING THAT RULE. THE AGENCY AND MEMBERS OF THE PUBLIC ARE INVITED TO SUBMIT THEIR

OWN COMMENTS AND RECOMMENDATIONS (ACCORDING TO RRC RULES) TO THE COMMISSION.

AGENCY: NC DHHS – DIVISION OF HEALTH SERVICES REGULATION RULE CITATION: 10A NCAC 14C .1902 RECOMMENDED ACTION:

Approve, but note staff’s comment

X Object, based on:

Lack of statutory authority

X Unclear or ambiguous

Unnecessary

Failure to adopt the rule in accordance with the APA

Extend the period of review

Return the rule to the agency for failure to comply with the Administrative Procedure Act

COMMENT:

In (c)(5) page 2 it is unclear what constitutes a “minority community.” What are the demographic parameters that lead us to identify a particular group as a minority community?

It is also unclear whether the rule is meant to focus on any minority or only African-American minorities that are the focus of the preceding sub-paragraph. It is also not clear whether “African American” is meant to refer to only American blacks or whether the rule intends to identify a black minority as a black person of any nationality and not just American.

RRC STAFF OPINION

PLEASE NOTE: THIS COMMUNICATION IS EITHER 1) ONLY THE RECOMMENDATION OF AN RRC

STAFF ATTORNEY AS TO ACTION THAT THE ATTORNEY BELIEVES THE COMMISSION SHOULD TAKE ON

THE CITED RULE AT ITS NEXT MEETING, OR 2) AN OPINION OF THAT ATTORNEY AS TO SOME MATTER

CONCERNING THAT RULE. THE AGENCY AND MEMBERS OF THE PUBLIC ARE INVITED TO SUBMIT THEIR

OWN COMMENTS AND RECOMMENDATIONS (ACCORDING TO RRC RULES) TO THE COMMISSION.

AGENCY: APPRENTICESHIP COUNCIL and DEPARTMENT OF LABOR

RULE CITATION: ALL TITLE 13 Rules EXCEPT 14A .0108 and 14B .0101

RECOMMENDED ACTION:

X Note staff’s comment

Object, based on:

Lack of statutory authority

Unclear or ambiguous

Unnecessary

Failure to comply with the APA

Extend the period of review

COMMENT: These rules were noticed in the Register and later submitted to the Rules Review

Commission as rules from the Department of Labor. The agency with statutory authority for these rules is

the Apprenticeship Council, subject to the approval of the Commissioner of Labor. The Council is an

agency all of whose voting members are appointed by the Commissioner. The only rulemaking authority

given directly to the Commissioner of Labor, the head of the Department of Labor, in G.S. Chapter 94 is

in relation to fees in G.S. 94-12.

Approval authority is not sufficient authority for the Department (Commissioner) to propose and adopt

these rules in place of the Apprenticeship Council. Only the Apprenticeship Council appears to have that

authority.

The Apprenticeship Council was notified by the Department that the Department planned to engage in

this rulemaking prior to the commencement of rulemaking without objection from the Council last

November. When the Department was notified that it appeared that the wrong agency had engaged in this

rulemaking activity, it called a meeting of the right agency, the Apprenticeship Council, on October 12.

At that meeting, the Apprenticeship Council formally adopted the rules.

Staff is satisfied that the Council has substantially complied with the Administrative Procedure Act

(APA). The Council was involved prior to the start of rulemaking and has formally adopted the rules.

The only real problem is that the published notice said the Department was proposing to adopt the rules.

Since all voting members are appointed by the Commissioner and the stated purpose of the Council is to

aid the Commissioner in formulating policies for the effective administration of the law pursuant to which

these rules were adopted, staff doubts that anyone was misled by the notice. Staff is satisfied that this is

substantial compliance with the Administrative Procedure Act as required by G.S. 150B-18.

If you find that the Apprenticeship Council did not substantially comply with the APA, then you should

object to the rules for the failure to comply with the APA.

Chapter 94.

Apprenticeship.

§ 94-1. Purpose.

The purposes of this Chapter are: to open to young people the opportunity to obtain training

that will equip them for profitable employment and citizenship; to set up, as a means to this end,

a program of voluntary apprenticeship under approved apprentice agreements providing facilities

for their training and guidance in the arts and crafts of industry and trade, with parallel

instruction in related and supplementary education; to promote employment opportunities for

young people under conditions providing adequate training and reasonable earnings; to relate the

supply of skilled workers to employment demands; to establish standards for apprentice training;

to establish an Apprenticeship Council and apprenticeship committees and sponsors to assist in

effectuating the purposes of this Chapter; to provide for a Director of Apprenticeship within the

Department of Labor; to provide for reports to the legislature and to the public regarding the

status of apprentice training in the State; to establish a procedure for the determination of

apprentice agreement controversies; and to accomplish related ends. (1939, c. 229, s. 1; 1979, c.

673, s. 1.)

§ 94-2. Apprenticeship Council.

The Commissioner of Labor shall appoint an Apprenticeship Council composed of four

representatives each from employer and employee organizations respectively and three

representatives from the public at large. One State official designated by the Department of

Public Instruction and one State official designated by the Department of Community Colleges

shall be a member ex officio of said council, without vote. The terms of office of the members of

the Apprenticeship Council first appointed by the Commissioner of Labor shall expire as

designated by the Commissioner at the time of making the appointment: two representatives each

of employers and employees, being appointed for one year and one representative of the public at

large being appointed for two years; and one representative each of employers, employees, and

the public at large being appointed for a term of three years. Any member appointed to fill a

vacancy occurring prior to the expiration of the term of his predecessor shall be appointed for the

remainder of said term. Each member of the Council not otherwise compensated by public

moneys, shall be reimbursed for transportation and shall receive such per diem compensation as

is provided generally for boards and commissions under the biennial maintenance appropriation

acts for each day spent in attendance at meetings of the Apprenticeship Council. The

Commissioner of Labor shall annually appoint one member of the Council to act as its chairman.

The Apprenticeship Council shall meet at the call of the Commissioner of Labor and shall aid

him in formulating policies for the effective administration of this Chapter. Subject to the

approval of the Commissioner, the Apprenticeship Council shall establish standards for

apprentice agreement which in no case shall be lower than those prescribed by this Chapter, shall

issue such rules and regulations as may be necessary to carry out the intent and purposes of said

Chapter, and shall perform such other functions as the Commissioner may direct. Not less than

once a year the Apprenticeship Council shall make a report through the Commissioner of Labor

of its activities and findings to the legislature and to the public. (1939, c. 229, s. 2; 1973, c. 476,

s. 138; 1977, c. 896.)

§ 94-3. Director of Apprenticeship.

The Commissioner of Labor is hereby directed to appoint a Director of Apprenticeship which

appointment shall be subject to the confirmation of the State Apprenticeship Council by a

majority vote. The Commissioner of Labor is further authorized to appoint and employ such

clerical, technical, and professional help as shall be necessary to effectuate the purposes of this

Chapter. (1939, c. 229, s. 3.)

§ 94-4. Powers and duties of Director of Apprenticeship.

The Director, under the supervision of the Commissioner of Labor and with the advice and

guidance of the Apprenticeship Council is authorized to administer the provisions of this

Chapter; in cooperation with the Apprenticeship Council and apprenticeship committees and

sponsors, to set up conditions and training standards for apprentice agreements, which conditions

or standards shall in no case be lower than those prescribed by this Chapter; to act as secretary of

the Apprenticeship Council; to approve for the Council if in his opinion approval is for the best

interest of the apprenticeship any apprentice agreement which meets the standards established

under this Chapter; to terminate or cancel any apprentice agreement in accordance with the

provisions of such agreement; to keep a record of apprentice agreements and their disposition; to

issue certificates of completion of apprenticeship; and to perform such other duties as are

necessary to carry out the intent of this Chapter, including other on-job training necessary for

emergency and critical civilian production: Provided, that the administration and supervision of

related and supplemental instruction for apprentices, coordination of instruction with job

experiences, and the selection and training of teachers and coordinators for such instruction shall

be the responsibility of State and local boards responsible for vocational education. (1939, c.

229, s. 4; 1951, c. 1031, s. 1; 1979, c. 673, s. 2.)

§ 94-5. Apprenticeship committees and program sponsors.

(a) As used in this Chapter:

(1) "Apprenticeship program" means a plan containing all terms and conditions

for the qualification, recruitment, selection, employment, and training of

apprentices, including such matters as the requirement for a written

apprenticeship agreement.

(2) "Apprenticeship agreement" means a written agreement between an

apprentice and either his employer or an apprenticeship committee or sponsor

acting as agent for employer(s), which agreement satisfies the requirements of

G.S. 94-7.

(3) "Sponsor" means any person, firm, corporation, organization, association or

committee operating an apprenticeship program and in whose name the

apprenticeship program is approved.

(4) "Employer" means any person, firm, corporation or organization employing

an apprentice whether or not such person, firm, corporation or organization is

a party to an apprenticeship agreement with the apprentice.

(5) "Apprenticeship committee" means those persons designated by the sponsor,

and approved by the Apprenticeship Council, to act for it in the administration

of the apprenticeship program. A committee may be "joint," i.e., it is

composed of an equal number of representatives of the employer(s) and of the

employees represented by a bona fide collective bargaining agent(s) and has

been established to conduct, operate or administer an apprenticeship program

and enter into apprenticeship agreements with apprentices. A committee may

be "unilateral" or "nonjoint" which shall mean a program sponsor in which

employees or a bona fide collective bargaining agent is not a party.

(b) An apprenticeship committee may be appointed by the Apprenticeship Council in any

trade or group of trades in a city or trade area, whenever the apprentice training needs of such

trade or group of trades justifies such establishment.

(c) The function of the apprenticeship committee, or sponsor when there is no

apprenticeship committee, shall be: to cooperate with school authorities in regard to the

education of apprentices; in accordance with the standards set up by the apprenticeship

committee for the same trade or group of trades, where such committee has been appointed, to

work in an advisory capacity with employers and employees in matters regarding schedule of

operations, application of wage rates, and working conditions for apprentices and to specify the

number of apprentices which shall be employed locally in the trade under the apprenticeship

agreements under this Chapter; and to adjust apprenticeship disputes, subject to the approval of

the director; to ascertain the prevailing rate for journeymen in the city or trade area and specify

the graduated scale of wages applicable to apprentices in such trade in such area; to ascertain

employment needs in such trade or group of trades and specify the appropriate current ratio of

apprentices to journeymen; and to make recommendations for the general good of apprentices

engaged in the trade or trades represented by the committee. An apprenticeship committee may

appoint a representative and delegate to such representative the authority for implementation and

performance of any standards adopted by the committee pursuant to any of the aforementioned

functions. (1939, c. 229, s. 5; 1979, c. 673, s. 3.)

§ 94-6. Definition of an apprentice.

The term "apprentice," as used herein, shall mean a person at least 16 years of age who is

covered by a written apprenticeship agreement approved by the Apprenticeship Council, which

apprenticeship agreement provides for not less than 2,000 hours of reasonably continuous

employment for such person for his participation in an approved schedule of work experience

and for organized, related supplemental instruction in technical subjects related to the trade. A

minimum of 144 hours of related supplemental instruction for each year of apprenticeship is

recommended. The required hours for apprenticeship agreements and the recommended hours

for related supplemental instruction may be decreased or increased in accordance with standards

adopted by the apprenticeship committee or sponsor, subject to approval of the Commissioner of

Labor. (1939, c. 229, s. 6; 1979, c. 479, ss. 1, 2; c. 673, s. 4.)

§ 94-7. Contents of agreement.

Every apprentice agreement entered into under this Chapter shall contain:

(1) The names of the contracting parties.

(2) The date of birth of the apprentice.

(3) A statement of the trade, craft, or business which the apprentice is to be

taught, and the time at which the apprenticeship will begin and end.

(4) A statement showing (i) the number of hours to be spent by the apprentice in

work on the job, and (ii) the number of hours to be spent in related and

supplemental instruction, which is recommended to be not less than 144 hours

per year: Provided, that in no case shall the combined weekly hours of work

and of required related and supplemental instruction of the apprentice exceed

the maximum number of hours of work prescribed by law for a person of the

age of the apprentice.

(5) A statement setting forth a schedule of the processes in the trade or industry

division in which the apprentice is to be taught and the approximate time to be

spent at each process.

(6) A statement of the graduated scale of wages to be paid the apprentice and

whether the required school time shall be compensated.

(7) A statement providing for a period of probation of not more than 500 hours of

employment and instruction extending over not more than four months, during

which time the apprentice agreement shall be terminated by the Director at the

request in writing of either party, and providing that after such probationary

period the apprentice agreement may be terminated by the Director by mutual

agreement of all parties thereto, or canceled by the Director for good and

sufficient reason. The Council at the request of a joint apprentice committee

may lengthen the period of probation.

(8) A provision that all controversies or differences concerning the apprentice

agreement which cannot be adjusted locally in accordance with G.S. 94-5

shall be submitted to the Director for determination.

(9) A provision that an employer who is unable to fulfill his obligation under the

apprentice agreement may with the approval of the Director transfer such

contract to any other employer: Provided, that the apprentice consents and

that such other employer agrees to assume the obligations of said apprentice

agreement.

(10) Such additional terms and conditions as may be prescribed or approved by the

Director not inconsistent with the provisions of this Chapter. (1939, c. 229, s.

7; 1945, c. 729, s. 1; 1977, c. 550, s. 1; 1979, c. 673, s. 5.)

§ 94-8. Approval of apprentice agreements; signatures.

No apprentice agreement under this Chapter shall be effective until approved by the Director.

Every apprentice agreement shall be signed by the employer, or by an association of employers

or an organization of employees as provided in G.S. 94-9, and by the apprentice, and if the

apprentice is a minor, by either of the minor's lawful parents, or by any person, agency,

organization or institution standing in loco parentis. Where a minor enters into an apprentice

agreement under this Chapter for a period of training extending into his majority, the apprentice

agreement shall likewise be binding for such a period as may be covered during the apprentice's

majority. (1939, c. 229, s. 8; 1977, c. 550, s. 2.)

§ 94-9. Rotation of employment.

For the purpose of providing greater diversity of training or continuity of employment, any

apprentice agreement made under this Chapter may in the discretion of the Director of

Apprenticeship be signed by an association of employers or an organization of employees

instead of by an individual employer. In such a case, the apprentice agreement shall expressly

provide that the association of employers or organization of employees does not assume the

obligation of an employer but agrees to use its best endeavors to procure employment and

training for such apprentice with one or more employers who will accept full responsibility, as

herein provided, for all the terms and conditions of employment and training set forth in said

agreement between the apprentice and employer association or employee organization during the

period of each such employment. The apprentice agreement in such a case shall also expressly

provide for the transfer of the apprentice, subject to the approval of the Director, to such

employer or employers who shall sign in written agreement with the apprentice, and if the

apprentice is a minor with his parent or guardian, as specified in G.S. 94-8, contracting to

employ said apprentice for the whole or a definite part of the total period of apprenticeship under

the terms and conditions of employment and training set forth in the said agreement entered into

between the apprentice and employer association or employee organization. (1939, c. 229, s. 9.)

§ 94-10. Repealed by Session Laws 1945, c. 729, s. 2.

§ 94-11. Limitation.

Nothing in this Chapter or in any apprentice agreement approved under this Chapter shall

operate to invalidate any apprenticeship provision in any collective agreement between

employers and employees, setting up higher apprenticeship standards; provided, that none of the

terms or provisions of this Chapter shall apply to any person, firm, corporation or crafts unless,

until, and only so long as such person, firm, corporation or crafts voluntarily elects that the terms

and provisions of this Chapter shall apply. Any person, firm, corporation or crafts terminating an

apprenticeship agreement shall notify the Director of Apprenticeship. (1939, c. 229, s. 11; 1945,

c. 729, s. 3.)

§ 94-12. Fees.

The following fees are imposed on each apprentice who is covered by a written

apprenticeship agreement entered into under this Chapter: (i) a new registration fee of

fifty dollars ($50.00); and (ii) an annual fee of fifty dollars ($50.00). Each fee authorized

by this section is payable as thirty dollars ($30.00) by the sponsor and twenty dollars

($20.00) by the apprentice. The sponsor shall collect the fees authorized by this section

from the apprentice and remit the total fees owed by the sponsor and the apprentice to the

Department of Labor. The fees are departmental receipts and must be applied to the costs

of administering the apprenticeship program. The Commissioner may adopt rules

pursuant to Chapter 150B of the General Statutes to implement this section. The

provisions of this section shall not apply to the State, a department or agency of the State,

or any political subdivision of the State or an apprentice of the State, a department or

agency of the State, or any political subdivision of the State. (2009-451, s. 12.1.)

RRC STAFF OPINION

PLEASE NOTE: THIS COMMUNICATION IS EITHER 1) ONLY THE RECOMMENDATION OF AN RRC

STAFF ATTORNEY AS TO ACTION THAT THE ATTORNEY BELIEVES THE COMMISSION SHOULD TAKE ON

THE CITED RULE AT ITS NEXT MEETING, OR 2) AN OPINION OF THAT ATTORNEY AS TO SOME MATTER

CONCERNING THAT RULE. THE AGENCY AND MEMBERS OF THE PUBLIC ARE INVITED TO SUBMIT THEIR

OWN COMMENTS AND RECOMMENDATIONS (ACCORDING TO RRC RULES) TO THE COMMISSION.

AGENCY: APPRENTICESHIP COUNCIL

RULE CITATION: 13 NCAC 14B .0202

RECOMMENDED ACTION:

Approve, but note staff’s comment

X Object, based on:

X Lack of statutory authority

Unclear or ambiguous

Unnecessary

Failure to comply with the APA

Extend the period of review

COMMENT:

In (a)(4), there is no authority cited for the agency to set occupational requirements for apprenticeship

instructors. G.S. 94-4 specifically states that "the selection and training of teachers and coordinators of

such instruction shall be the responsibility of State and local boards responsible for vocational education."

ROBERT A. BRYAN, JR. COMMISSION COUNSEL

RRC STAFF OPINION

PLEASE NOTE: THIS COMMUNICATION IS EITHER 1) ONLY THE RECOMMENDATION OF AN RRC

STAFF ATTORNEY AS TO ACTION THAT THE ATTORNEY BELIEVES THE COMMISSION SHOULD TAKE ON

THE CITED RULE AT ITS NEXT MEETING, OR 2) AN OPINION OF THAT ATTORNEY AS TO SOME MATTER

CONCERNING THAT RULE. THE AGENCY AND MEMBERS OF THE PUBLIC ARE INVITED TO SUBMIT THEIR

OWN COMMENTS AND RECOMMENDATIONS (ACCORDING TO RRC RULES) TO THE COMMISSION.

AGENCY: APPRENTICESHIP COUNCIL

RULE CITATION: 13 NCAC 14B .0205

RECOMMENDED ACTION:

Approve, but note staff’s comment

X Object, based on:

Lack of statutory authority

X Unclear or ambiguous

Unnecessary

Failure to comply with the APA

Extend the period of review

COMMENT:

In (g)(2), it is not clear to whom the department is going to recommend a program for deregistration

procedures. It appears that the department itself has the deregistration authority.

There is the same issue in (h).

ROBERT A. BRYAN, JR. COMMISSION COUNSEL

RRC STAFF OPINION

PLEASE NOTE: THIS COMMUNICATION IS EITHER 1) ONLY THE RECOMMENDATION OF AN RRC

STAFF ATTORNEY AS TO ACTION THAT THE ATTORNEY BELIEVES THE COMMISSION SHOULD TAKE ON

THE CITED RULE AT ITS NEXT MEETING, OR 2) AN OPINION OF THAT ATTORNEY AS TO SOME MATTER

CONCERNING THAT RULE. THE AGENCY AND MEMBERS OF THE PUBLIC ARE INVITED TO SUBMIT THEIR

OWN COMMENTS AND RECOMMENDATIONS (ACCORDING TO RRC RULES) TO THE COMMISSION.

AGENCY: APPRENTICESHIP COUNCIL

RULE CITATION: 13 NCAC 14B .0208

RECOMMENDED ACTION:

Approve, but note staff’s comment

X Object, based on:

X Lack of statutory authority

Unclear or ambiguous

Unnecessary

Failure to comply with the APA

Extend the period of review

COMMENT:

Item (5) is not consistent with G.S. 94-7(8). The statute provides that controversies or differences that

cannot be adjusted locally be submitted to the Director for determination. The rule requires the

designation of some other authority.

ROBERT A. BRYAN, JR. COMMISSION COUNSEL

RRC STAFF OPINION

PLEASE NOTE: THIS COMMUNICATION IS EITHER 1) ONLY THE RECOMMENDATION OF AN RRC

STAFF ATTORNEY AS TO ACTION THAT THE ATTORNEY BELIEVES THE COMMISSION SHOULD TAKE ON

THE CITED RULE AT ITS NEXT MEETING, OR 2) AN OPINION OF THAT ATTORNEY AS TO SOME MATTER

CONCERNING THAT RULE. THE AGENCY AND MEMBERS OF THE PUBLIC ARE INVITED TO SUBMIT THEIR

OWN COMMENTS AND RECOMMENDATIONS (ACCORDING TO RRC RULES) TO THE COMMISSION.

AGENCY: APPRENTICESHIP COUNCIL

RULE CITATION: 13 NCAC 14B .0211

RECOMMENDED ACTION:

Approve, but note staff’s comment

X Object, based on:

X Lack of statutory authority

Unclear or ambiguous

Unnecessary

Failure to comply with the APA

Extend the period of review

COMMENT:

The provision in Paragraph (c) giving a sponsor 30 days to appeal the director's decision (file a contested

case) is not consistent with G.S. 150B-23(f) which gives 60 days.

ROBERT A. BRYAN, JR. COMMISSION COUNSEL

§ 150B-23. Commencement; assignment of administrative law judge; hearing required;

notice; intervention.

(a) A contested case shall be commenced by paying a fee in an amount established in

G.S. 150B-23.2 and by filing a petition with the Office of Administrative Hearings and, except

as provided in Article 3A of this Chapter, shall be conducted by that Office. The party who files

the petition shall serve a copy of the petition on all other parties and, if the dispute concerns a

license, the person who holds the license. A party who files a petition shall file a certificate of

service together with the petition. A petition shall be signed by a party or a representative of the

party and, if filed by a party other than an agency, shall state facts tending to establish that the

agency named as the respondent has deprived the petitioner of property, has ordered the

petitioner to pay a fine or civil penalty, or has otherwise substantially prejudiced the petitioner's

rights and that the agency:

(1) Exceeded its authority or jurisdiction;

(2) Acted erroneously;

(3) Failed to use proper procedure;

(4) Acted arbitrarily or capriciously; or

(5) Failed to act as required by law or rule.

The parties in a contested case shall be given an opportunity for a hearing without undue delay.

Any person aggrieved may commence a contested case hereunder.

A local government employee, applicant for employment, or former employee to whom

Chapter 126 of the General Statutes applies may commence a contested case under this Article in

the same manner as any other petitioner. The case shall be conducted in the same manner as

other contested cases under this Article, except that the State Personnel Commission shall enter

final decisions only in cases in which it is found that the employee, applicant, or former

employee has been subjected to discrimination prohibited by Article 6 of Chapter 126 of the

General Statutes or in any case where a binding decision is required by applicable federal

standards. In these cases, the State Personnel Commission's decision shall be binding on the local

appointing authority. In all other cases, the final decision shall be made by the applicable

appointing authority.

(a1) Repealed by Session Laws 1985 (Regular Session, 1986), c. 1022, s. 1(9).

(a2) An administrative law judge assigned to a contested case may require a party to the

case to file a prehearing statement. A party's prehearing statement must be served on all other

parties to the contested case.

(b) The parties to a contested case shall be given a notice of hearing not less than 15 days

before the hearing by the Office of Administrative Hearings. If prehearing statements have been

filed in the case, the notice shall state the date, hour, and place of the hearing. If prehearing

statements have not been filed in the case, the notice shall state the date, hour, place, and nature

of the hearing, shall list the particular sections of the statutes and rules involved, and shall give a

short and plain statement of the factual allegations.

(c) Notice shall be given personally or by certified mail. If given by certified mail, it

shall be deemed to have been given on the delivery date appearing on the return receipt. If giving

of notice cannot be accomplished either personally or by certified mail, notice shall then be given

in the manner provided in G.S. 1A-1, Rule 4(j1).

(d) Any person may petition to become a party by filing a motion to intervene in the

manner provided in G.S. 1A-1, Rule 24. In addition, any person interested in a contested case

may intervene and participate in that proceeding to the extent deemed appropriate by the

administrative law judge.

(e) All hearings under this Chapter shall be open to the public. Hearings shall be

conducted in an impartial manner. Hearings shall be conducted according to the procedures set

out in this Article, except to the extent and in the particulars that specific hearing procedures and

time standards are governed by another statute.

(f) Unless another statute or a federal statute or regulation sets a time limitation for the

filing of a petition in contested cases against a specified agency, the general limitation for the

filing of a petition in a contested case is 60 days. The time limitation, whether established by

another statute, federal statute, or federal regulation, or this section, shall commence when notice

is given of the agency decision to all persons aggrieved who are known to the agency by

personal delivery or by the placing of the notice in an official depository of the United States

Postal Service wrapped in a wrapper addressed to the person at the latest address given by the

person to the agency. The notice shall be in writing, and shall set forth the agency action, and

shall inform the persons of the right, the procedure, and the time limit to file a contested case

petition. When no informal settlement request has been received by the agency prior to issuance

of the notice, any subsequent informal settlement request shall not suspend the time limitation

for the filing of a petition for a contested case hearing. (1973, c. 1331, s. 1; 1975, 2nd Sess., c.

983, s. 65; 1985, c. 746, s. 1; 1985 (Reg. Sess., 1986), c. 1022, ss. 1(9), (10), 6(2), (3); 1987, c.

878, ss. 3-5; c. 879, s. 6.1; 1987 (Reg. Sess., 1988), c. 1111, s. 5; 1991, c. 35, s. 1; 1993 (Reg.

Sess., 1994), c. 572, s. 2; 2009-451, s. 21A.1(a).)

RRC STAFF OPINION

PLEASE NOTE: THIS COMMUNICATION IS EITHER 1) ONLY THE RECOMMENDATION OF AN RRC

STAFF ATTORNEY AS TO ACTION THAT THE ATTORNEY BELIEVES THE COMMISSION SHOULD TAKE ON

THE CITED RULE AT ITS NEXT MEETING, OR 2) AN OPINION OF THAT ATTORNEY AS TO SOME MATTER

CONCERNING THAT RULE. THE AGENCY AND MEMBERS OF THE PUBLIC ARE INVITED TO SUBMIT THEIR

OWN COMMENTS AND RECOMMENDATIONS (ACCORDING TO RRC RULES) TO THE COMMISSION.

AGENCY: APPRENTICESHIP COUNCIL and DEPARTMENT OF LABOR

RULE CITATION: 13 NCAC 14B .0213

RECOMMENDED ACTION:

Approve, but note staff’s comment

X Object, based on:

X Lack of statutory authority

Unclear or ambiguous

Unnecessary

Failure to comply with the APA

Extend the period of review

COMMENT:

The provision in Paragraph (c) giving a sponsor 30 days to appeal the director's decision (file a contested

case) is not consistent with G.S. 150B-23(f) which gives 60 days.

ROBERT A. BRYAN, JR. COMMISSION COUNSEL

RRC STAFF OPINION

PLEASE NOTE: THIS COMMUNICATION IS EITHER 1) ONLY THE RECOMMENDATION OF AN RRC

STAFF ATTORNEY AS TO ACTION THAT THE ATTORNEY BELIEVES THE COMMISSION SHOULD TAKE ON

THE CITED RULE AT ITS NEXT MEETING, OR 2) AN OPINION OF THAT ATTORNEY AS TO SOME MATTER

CONCERNING THAT RULE. THE AGENCY AND MEMBERS OF THE PUBLIC ARE INVITED TO SUBMIT THEIR

OWN COMMENTS AND RECOMMENDATIONS (ACCORDING TO RRC RULES) TO THE COMMISSION.

AGENCY: APPRENTICESHIP COUNCIL

RULE CITATION: 13 NCAC 14B .0308

RECOMMENDED ACTION:

Approve, but note staff’s comment

X Object, based on:

X Lack of statutory authority

Unclear or ambiguous

Unnecessary

Failure to comply with the APA

Extend the period of review

COMMENT:

The provision in Paragraph (c) giving a sponsor 30 days to appeal the director's decision (file a contested

case) is not consistent with G.S. 150B-23(f) which gives 60 days.

ROBERT A. BRYAN, JR. COMMISSION COUNSEL

RRC STAFF OPINION

PLEASE NOTE: THIS COMMUNICATION IS EITHER 1) ONLY THE RECOMMENDATION OF AN RRC

STAFF ATTORNEY AS TO ACTION THAT THE ATTORNEY BELIEVES THE COMMISSION SHOULD TAKE ON

THE CITED RULE AT ITS NEXT MEETING, OR 2) AN OPINION OF THAT ATTORNEY AS TO SOME MATTER

CONCERNING THAT RULE. THE AGENCY AND MEMBERS OF THE PUBLIC ARE INVITED TO SUBMIT THEIR

OWN COMMENTS AND RECOMMENDATIONS (ACCORDING TO RRC RULES) TO THE COMMISSION.

AGENCY: APPRENTICESHIP COUNCIL

RULE CITATION: 13 NCAC 14B .0401

RECOMMENDED ACTION:

Approve, but note staff’s comment

X Object, based on:

X Lack of statutory authority

X Unclear or ambiguous

Unnecessary

Failure to comply with the APA

Extend the period of review

COMMENT:

In (c)(3), it is not clear what factors the director will use in determining good cause for an extension. As

written this provision amounts to a modification provision without specific guidelines in violation of G.S.

150B-19(6).

ROBERT A. BRYAN, JR. COMMISSION COUNSEL

RRC STAFF OPINION

PLEASE NOTE: THIS COMMUNICATION IS EITHER 1) ONLY THE RECOMMENDATION OF AN RRC

STAFF ATTORNEY AS TO ACTION THAT THE ATTORNEY BELIEVES THE COMMISSION SHOULD TAKE ON

THE CITED RULE AT ITS NEXT MEETING, OR 2) AN OPINION OF THAT ATTORNEY AS TO SOME MATTER

CONCERNING THAT RULE. THE AGENCY AND MEMBERS OF THE PUBLIC ARE INVITED TO SUBMIT THEIR

OWN COMMENTS AND RECOMMENDATIONS (ACCORDING TO RRC RULES) TO THE COMMISSION.

AGENCY: APPRENTICESHIP COUNCIL

RULE CITATION: 13 NCAC 14B .0407

RECOMMENDED ACTION:

Approve, but note staff’s comment

X Object, based on:

Lack of statutory authority

X Unclear or ambiguous

Unnecessary

Failure to comply with the APA

Extend the period of review

COMMENT:

In (a)(2)(C), it is not clear what constitutes "good and sufficient reason."

In (d), it is not clear what constitutes "good cause" for de-registration.

ROBERT A. BRYAN, JR. COMMISSION COUNSEL

RRC STAFF OPINION

PLEASE NOTE: THIS COMMUNICATION IS EITHER 1) ONLY THE RECOMMENDATION OF AN RRC

STAFF ATTORNEY AS TO ACTION THAT THE ATTORNEY BELIEVES THE COMMISSION SHOULD TAKE ON

THE CITED RULE AT ITS NEXT MEETING, OR 2) AN OPINION OF THAT ATTORNEY AS TO SOME MATTER

CONCERNING THAT RULE. THE AGENCY AND MEMBERS OF THE PUBLIC ARE INVITED TO SUBMIT THEIR

OWN COMMENTS AND RECOMMENDATIONS (ACCORDING TO RRC RULES) TO THE COMMISSION.

AGENCY: APPRENTICESHIP COUNCIL

RULE CITATION: 13 NCAC 14B .0604

RECOMMENDED ACTION:

Approve, but note staff’s comment

X Object, based on:

Lack of statutory authority

X Unclear or ambiguous

Unnecessary

Failure to comply with the APA

Extend the period of review

COMMENT:

In (b)(4), it is not clear what is meant by "the extent to which the sponsor should be expected to correct

any deficiencies through the achievement of goals and timetables for the selection of apprentices."

ROBERT A. BRYAN, JR. COMMISSION COUNSEL

RRC STAFF OPINION

PLEASE NOTE: THIS COMMUNICATION IS EITHER 1) ONLY THE RECOMMENDATION OF AN RRC

STAFF ATTORNEY AS TO ACTION THAT THE ATTORNEY BELIEVES THE COMMISSION SHOULD TAKE ON

THE CITED RULE AT ITS NEXT MEETING, OR 2) AN OPINION OF THAT ATTORNEY AS TO SOME MATTER

CONCERNING THAT RULE. THE AGENCY AND MEMBERS OF THE PUBLIC ARE INVITED TO SUBMIT THEIR

OWN COMMENTS AND RECOMMENDATIONS (ACCORDING TO RRC RULES) TO THE COMMISSION.

AGENCY: APPRENTICESHIP COUNCIL

RULE CITATION: 13 NCAC 14B .0610

RECOMMENDED ACTION:

Approve, but note staff’s comment

X Object, based on:

Lack of statutory authority

X Unclear or ambiguous

Unnecessary

Failure to comply with the APA

Extend the period of review

COMMENT:

In (b)(7), it is not clear what other records will be required by the director.

ROBERT A. BRYAN, JR. COMMISSION COUNSEL

RRC STAFF OPINION

PLEASE NOTE: THIS COMMUNICATION IS EITHER 1) ONLY THE RECOMMENDATION OF AN RRC

STAFF ATTORNEY AS TO ACTION THAT THE ATTORNEY BELIEVES THE COMMISSION SHOULD TAKE ON

THE CITED RULE AT ITS NEXT MEETING, OR 2) AN OPINION OF THAT ATTORNEY AS TO SOME MATTER

CONCERNING THAT RULE. THE AGENCY AND MEMBERS OF THE PUBLIC ARE INVITED TO SUBMIT THEIR

OWN COMMENTS AND RECOMMENDATIONS (ACCORDING TO RRC RULES) TO THE COMMISSION.

AGENCY: APPRENTICESHIP COUNCIL

RULE CITATION: 13 NCAC 14B .0611

RECOMMENDED ACTION:

Approve, but note staff’s comment

X Object, based on:

Lack of statutory authority

X Unclear or ambiguous

Unnecessary

Failure to comply with the APA

Extend the period of review

COMMENT:

In (e)(3), it is not clear what standards the department will use in determining what is a reasonable time.

ROBERT A. BRYAN, JR. COMMISSION COUNSEL

RRC STAFF OPINION

PLEASE NOTE: THIS COMMUNICATION IS EITHER 1) ONLY THE RECOMMENDATION OF AN RRC

STAFF ATTORNEY AS TO ACTION THAT THE ATTORNEY BELIEVES THE COMMISSION SHOULD TAKE ON

THE CITED RULE AT ITS NEXT MEETING, OR 2) AN OPINION OF THAT ATTORNEY AS TO SOME MATTER

CONCERNING THAT RULE. THE AGENCY AND MEMBERS OF THE PUBLIC ARE INVITED TO SUBMIT THEIR

OWN COMMENTS AND RECOMMENDATIONS (ACCORDING TO RRC RULES) TO THE COMMISSION.

AGENCY: APPRENTICESHIP COUNCIL

RULE CITATION: 13 NCAC 14B .0612

RECOMMENDED ACTION:

Approve, but note staff’s comment

X Object, based on:

Lack of statutory authority

X Unclear or ambiguous

Unnecessary

Failure to comply with the APA

Extend the period of review

COMMENT:

In (a), it is not clear what standards the director will use in determining what is a reasonable time.

ROBERT A. BRYAN, JR. COMMISSION COUNSEL

RRC STAFF OPINION

PLEASE NOTE: THIS COMMUNICATION IS EITHER 1) ONLY THE RECOMMENDATION OF AN RRC

STAFF ATTORNEY AS TO ACTION THAT THE ATTORNEY BELIEVES THE COMMISSION SHOULD TAKE ON

THE CITED RULE AT ITS NEXT MEETING, OR 2) AN OPINION OF THAT ATTORNEY AS TO SOME MATTER

CONCERNING THAT RULE. THE AGENCY AND MEMBERS OF THE PUBLIC ARE INVITED TO SUBMIT THEIR

OWN COMMENTS AND RECOMMENDATIONS (ACCORDING TO RRC RULES) TO THE COMMISSION.

AGENCY: BOARD OF ARCHITECTURE

RULE CITATION: 21 NCAC 02 .0108

RECOMMENDED ACTION:

Approve, but note staff’s comment

X Object, based on:

X Lack of statutory authority

Unclear or ambiguous

Unnecessary

Failure to comply with the APA

Extend the period of review

COMMENT:

There does not appear to be any authority for the two hundred fifty dollars ($250.00) reinstatement fee.

G.S. 83A-4 specifically prohibits the Board from collecting any fees not authorized by Chapter 83A. G.S.

83A-11 allows the Board to reinstate in its discretion after one year from the date of revocation, but it

does not authorize any special fee to do so. It appears that the only fees allowed to be charged are one

renewal fee plus a late penalty without any stacking.

ROBERT A. BRYAN, JR. COMMISSION COUNSEL

§ 83A-4. Fees.

All fees and charges by the Board shall be established by Board rule subject to the provisions

of the Administrative Procedure Act.

Fees set by the Board shall not exceed the following amounts:

Initial Application

Individual

Residents $50.00

Nonresidents $50.00

Corporate $75.00

Reexamination $25.00

Annual License Renewal

Individual $75.00

Corporate $100.00

Late Renewal Penalty

Up-to-30 days $50.00

30 days to 1 year $50.00

Reciprocal Registration $150.00

The above fees are provided in addition to any other fees prescribed by law. Reasonable fees for

examination materials, certificates, rosters and other published materials shall be established by

the Board, but the Board shall not collect any fees not authorized by this Chapter. (1915, c. 270,

ss. 3, 6; 1919, c. 336, ss. 1, 2; C.S., ss. 4992, 4994, 4995; 1951, c. 1130, s. 2; 1957, c. 794, ss. 7,

9, 10; 1971, c. 1231, s. 1; 1979, c. 871, s. 1; 1985, c. 364.)

§ 83A-11. Expirations and renewals.

Certificates must be renewed on or before the first day of July in each year. No less than 30

days prior to the renewal date, a renewal application shall be mailed to each individual and

corporate licensee. The completed application together with the required renewal fee shall be

returned to the Board on or before the renewal date. When the Board is satisfied as to the

continuing competency of an architect, it shall issue a renewal of the certificate. Upon failure to

renew within 30 days after the date set for expiration, the license shall be automatically revoked

but such license may be renewed at any time within one year following the expiration date upon

proof of continuing competency and payment of the renewal fee plus a late renewal fee. After

one year from the date of revocation, reinstatement may be made by the Board, or in its

discretion, the application may be treated as new subject to reexamination and qualification

requirements as in the case of new applications. (1919, c. 336, s. 2; C.S., s. 4995; 1951, c. 1130,

s. 2; 1957, c. 794, s. 10; 1979, c. 871, s. 1.)

RRC STAFF OPINION

PLEASE NOTE: THIS COMMUNICATION IS EITHER 1) ONLY THE RECOMMENDATION OF AN RRC

STAFF ATTORNEY AS TO ACTION THAT THE ATTORNEY BELIEVES THE COMMISSION SHOULD TAKE ON

THE CITED RULE AT ITS NEXT MEETING, OR 2) AN OPINION OF THAT ATTORNEY AS TO SOME MATTER

CONCERNING THAT RULE. THE AGENCY AND MEMBERS OF THE PUBLIC ARE INVITED TO SUBMIT THEIR

OWN COMMENTS AND RECOMMENDATIONS (ACCORDING TO RRC RULES) TO THE COMMISSION.

AGENCY: BOARD OF ARCHITECTURE

RULE CITATION: 21 NCAC 02 .0204

RECOMMENDED ACTION:

Approve, but note staff’s comment

X Object, based on:

X Lack of statutory authority

Unclear or ambiguous

Unnecessary

Failure to comply with the APA

Extend the period of review

COMMENT:

There is no authority for the Board to adopt a rule limiting the practice of architecture beyond any

limitations in G.S. Chapter 83A. For instance, G.S. 83A-9 would appear to allow for a general

partnership, but the rule appears to prohibit that.

ROBERT A. BRYAN, JR. COMMISSION COUNSEL

§ 83A-6. Board rules; bylaws; standards of professional conduct.

(a) The Board shall have the power to adopt bylaws, rules, and standards of professional

conduct to carry out the purposes of this Chapter, including, but not limited to:

(1) The adoption of bylaws governing its meetings and proceedings;

(2) The establishment of qualification requirements for admission to

examinations, and for individual or corporate licensure as provided in G.S.

83A-7 and 83A-8;

(3) The establishment of the types and contents of examinations, their conduct,

and the minimum scores or other criteria for passing such examinations;

(4) The adoption of mandatory standards of professional conduct concerning

misrepresentations, conflicts of interest, incompetence, disability, violations

of law, dishonest conduct, or other unprofessional conduct for those persons

or corporations regulated by this Chapter, which standards shall be

enforceable under the disciplinary procedures of the Board;

(5) The establishment or approval of requirements for renewal of licenses

designed to promote the continued professional development and competence

of licensees. Such requirements shall be designed solely to improve the

professional knowledge and skills of a licensee directly related to the current

and emerging bodies of knowledge and skills of the licensee's profession.

When necessary to protect the public health, safety, or welfare, the Board shall require such

evidence as it deems necessary to establish the continuing competency of architects as a

condition of renewal of licenses.

(b) The Board shall not adopt any rule or regulation which prohibits advertising.

(c) The adoption, amendment or revocation of rules, regulations, and standards of

professional conduct, and the publication and distribution of the same shall be subject to the

provisions of the Administrative Procedure Act. (1979, c. 871, s. 1.)

§ 83A-8. Qualification for corporate practice.

(a) Any corporation desiring to practice architecture in this State shall file corporate

application on forms provided by the Board, accompanied by the required application fee. To be

eligible for a corporate certificate, the corporation must meet all requirements of the Professional

Corporation Act.

(b) Architectural corporations of other states may be granted corporate certificates for

practice in this State upon filing application with the Board and satisfying the Board that they

meet the requirements of subsection (a) above. Such corporations shall designate the individual

or individuals licensed to practice architecture in this State who shall be in responsible charge of

all architectural work offered or performed by such corporation in this State. Such corporations

shall notify the Board of changes in such designation.

(c) All corporations holding corporate certificates from the Board shall be subject to the

applicable rules and regulations adopted by the Board, and to all the disciplinary powers

applicable to individual licensees who are officers or employees of the corporation. Corporations

may perform no acts or things forbidden to officers or employees as licensees. (1979, c. 871, s.

1.)

§ 83A-9. Partnership practice.

This Chapter neither prevents practice of architecture by a partnership nor requires

partnership seals or certificates of practice provided that the members of the partnership are duly

licensed to practice architecture, and, provided that the partnership files with the Board and

keeps current a list of the partners, their license identifications, and the types of services offered

by the partnership. (1979, c. 871, s. 1.)

RRC STAFF OPINION

PLEASE NOTE: THIS COMMUNICATION IS EITHER 1) ONLY THE RECOMMENDATION OF AN RRC

STAFF ATTORNEY AS TO ACTION THAT THE ATTORNEY BELIEVES THE COMMISSION SHOULD TAKE ON

THE CITED RULE AT ITS NEXT MEETING, OR 2) AN OPINION OF THAT ATTORNEY AS TO SOME MATTER

CONCERNING THAT RULE. THE AGENCY AND MEMBERS OF THE PUBLIC ARE INVITED TO SUBMIT THEIR

OWN COMMENTS AND RECOMMENDATIONS (ACCORDING TO RRC RULES) TO THE COMMISSION.

AGENCY: BOARD OF ARCHITECTURE

RULE CITATION: 21 NCAC 02 .0206

RECOMMENDED ACTION:

Approve, but note staff’s comment

X Object, based on:

X Lack of statutory authority

Unclear or ambiguous

Unnecessary

Failure to comply with the APA

Extend the period of review

COMMENT:

There is no authority cited for the Board to require seals for a Limited Liability Partnership as the rule

does in (a)(3)(C), or for a partnership as the rule does in (a)(3)(D). G.S. 83A-9 specifically states that

G.S. Chapter 83A does not require partnership seals. The only seals required by statute are individual

seals and corporate seals. G.S. 57C-2-01(c) would extend that to Professional Limited Liability

Companies.

ROBERT A. BRYAN, JR. COMMISSION COUNSEL

§ 83A-6. Board rules; bylaws; standards of professional conduct.

(a) The Board shall have the power to adopt bylaws, rules, and standards of professional

conduct to carry out the purposes of this Chapter, including, but not limited to:

(1) The adoption of bylaws governing its meetings and proceedings;

(2) The establishment of qualification requirements for admission to

examinations, and for individual or corporate licensure as provided in G.S.

83A-7 and 83A-8;

(3) The establishment of the types and contents of examinations, their conduct,

and the minimum scores or other criteria for passing such examinations;

(4) The adoption of mandatory standards of professional conduct concerning

misrepresentations, conflicts of interest, incompetence, disability, violations

of law, dishonest conduct, or other unprofessional conduct for those persons

or corporations regulated by this Chapter, which standards shall be

enforceable under the disciplinary procedures of the Board;

(5) The establishment or approval of requirements for renewal of licenses

designed to promote the continued professional development and competence

of licensees. Such requirements shall be designed solely to improve the

professional knowledge and skills of a licensee directly related to the current

and emerging bodies of knowledge and skills of the licensee's profession.

When necessary to protect the public health, safety, or welfare, the Board shall require such

evidence as it deems necessary to establish the continuing competency of architects as a

condition of renewal of licenses.

(b) The Board shall not adopt any rule or regulation which prohibits advertising.

(c) The adoption, amendment or revocation of rules, regulations, and standards of

professional conduct, and the publication and distribution of the same shall be subject to the

provisions of the Administrative Procedure Act. (1979, c. 871, s. 1.)

§ 83A-9. Partnership practice.

This Chapter neither prevents practice of architecture by a partnership nor requires

partnership seals or certificates of practice provided that the members of the partnership are duly

licensed to practice architecture, and, provided that the partnership files with the Board and

keeps current a list of the partners, their license identifications, and the types of services offered

by the partnership. (1979, c. 871, s. 1.)

§ 83A-10. Professional seals.

Every licensed architect shall have a seal of a design authorized by the Board, and shall

imprint all drawings and sets of specifications prepared for use in this State with an impression

of such seal. Licensed architectural corporations shall employ corporate professional seals, of a

design approved by the Board, for use in identifying plans, specifications and other professional

documents issued by the corporation, but use of such corporate seals shall be in addition to and

not in substitution for the requirement that the individual seal of the author of such plans and

professional documents be affixed. (1915, c. 270, s. 7; C.S., s. 4997; 1979, c. 871, s. 1.)

§ 83A-12. Prohibited practice.

The purpose of the Chapter is to safeguard life, health and property. It shall be unlawful for

any individual, firm or corporation to practice or offer to practice architecture in this State as

defined in this Chapter, or to use the title "Architect" or any form thereof, except as provided in

Chapter 89A for Landscape Architects, or to display or use any words, letters, figures, titles,

sign, card, advertisement, or other device to indicate that such individual or firm practices or

offers to practice architecture as herein defined or is an architect or architectural firm qualified to

perform architectural work, unless such person holds a current individual or corporate certificate

of admission to practice architecture under the provisions of this Chapter. (1915, c. 270, s. 4;

C.S., s. 4996; 1941, c. 369, ss. 1, 2; 1951, c. 1130, s. 3; 1957, c. 794, s. 11; 1965, c. 1100; 1969,

c. 718, s. 21; 1973, c. 1414, s. 1; 1979, c. 871, s. 1.)

Article 2.

Purposes, Powers, Formation, Annual Report, Name, Registered Office, and Agent.

Part 1. Purposes and Powers.

§ 57C-2-01. Purposes.

(a) Every limited liability company formed under this Chapter has the purpose of

engaging in any lawful business unless a more limited lawful purpose is set forth in its articles of

organization.

(b) A domestic or foreign limited liability company engaging in a business that is subject

to regulation under another statute of this State may be formed or authorized to transact business

under this Chapter only if permitted by and subject to all limitations of the other statute giving

effect to subsection (c) of this section.

(c) Subsections (a) and (b) of this section to the contrary notwithstanding and except as

set forth in this subsection, a domestic or foreign limited liability company shall engage in

rendering professional services only to the extent that a professional corporation acting pursuant

to Chapter 55B of the General Statutes or a corporation acting pursuant to Chapter 55 of the

General Statutes may engage in rendering professional services under the conditions and

limitations imposed by an applicable licensing statute. Chapter 55B of the General Statutes and

each applicable licensing statute are deemed amended to provide that professionals licensed

under the applicable licensing statute may render professional services through a domestic or

foreign limited liability company. For purposes of applying the provisions, conditions, and

limitations of Chapter 55B of the General Statutes and the applicable licensing statute to

domestic and foreign limited liability companies that engage in rendering professional services,

(i) unless the context clearly requires otherwise, references to Chapter 55 of the General Statutes

(the North Carolina Business Corporation Act) shall be treated as references to this Chapter, and

references to a "corporation" or "foreign corporation" shall be treated as references to a limited

liability company or foreign limited liability company, respectively, (ii) members shall be treated

in the same manner as shareholders of a professional corporation, (iii) managers and directors

shall be treated in the same manner as directors of a professional corporation, (iv) the persons

signing the articles of organization of a limited liability company shall be treated in the same

manner as the incorporators of a professional corporation, and (v) the name of a domestic or

foreign limited liability company so engaged shall comply with Article 3 of Chapter 55D of the

General Statutes and, in addition, shall contain the word "Professional" or the abbreviation

"P.L.L.C." or "PLLC". For purposes of this subsection, "applicable licensing statute" shall mean

those provisions of the General Statutes referred to in G.S. 55B-2(6).

Nothing in this Chapter shall be interpreted to abolish, modify, restrict, limit, or alter the law

in this State applicable to the professional relationship and liabilities between the individual

furnishing the professional services and the person receiving the professional services, the

standards of professional conduct applicable to the rendering of the services, or any

responsibilities, obligations, or sanctions imposed under applicable licensing statutes. A member,

manager, director, or executive of a professional limited liability company is not individually

liable, directly or indirectly, including by indemnification, contribution, assessment, or

otherwise, for debts, obligations, and liabilities of, or chargeable to, the professional limited

liability company that arise from errors, omissions, negligence, malpractice, incompetence, or

malfeasance committed by another member, manager, director, executive, employee, agent, or

other representative of the professional limited liability company; provided, however, nothing in

this Chapter shall affect the liability of a member, manager, director, or executive of a

professional limited liability company for his or her own errors, omissions, negligence,

malpractice, incompetence, or malfeasance committed in the rendering of professional services.

(1993, c. 354, s. 1; 1995, c. 351, s. 21; 1999-362, s. 3; 2001-358, s. 26; 2001-387, ss. 55, 173,

175(a); 2001-413, s. 6.)

RRC STAFF OPINION

PLEASE NOTE: THIS COMMUNICATION IS EITHER 1) ONLY THE RECOMMENDATION OF AN RRC

STAFF ATTORNEY AS TO ACTION THAT THE ATTORNEY BELIEVES THE COMMISSION SHOULD TAKE ON

THE CITED RULE AT ITS NEXT MEETING, OR 2) AN OPINION OF THAT ATTORNEY AS TO SOME MATTER

CONCERNING THAT RULE. THE AGENCY AND MEMBERS OF THE PUBLIC ARE INVITED TO SUBMIT THEIR

OWN COMMENTS AND RECOMMENDATIONS (ACCORDING TO RRC RULES) TO THE COMMISSION.

AGENCY: BOARD OF ARCHITECTURE

RULE CITATION: 21 NCAC 02 .0213

RECOMMENDED ACTION:

Approve, but note staff’s comment

X Object, based on:

X Lack of statutory authority

Unclear or ambiguous

Unnecessary

Failure to comply with the APA

Extend the period of review

COMMENT:

G.S. 83A-11 requires certificates to be renewed on or before the first day in July every year. There is no

authority cited for the Board to change that date to June 30 as the rule does in (a), (b) and (c).

"Certificate" and "License registration" are used interchangeably in the statutes and rules.

ROBERT A. BRYAN, JR. COMMISSION COUNSEL

§ 83A-11. Expirations and renewals.

Certificates must be renewed on or before the first day of July in each year. No less than 30

days prior to the renewal date, a renewal application shall be mailed to each individual and

corporate licensee. The completed application together with the required renewal fee shall be

returned to the Board on or before the renewal date. When the Board is satisfied as to the

continuing competency of an architect, it shall issue a renewal of the certificate. Upon failure to

renew within 30 days after the date set for expiration, the license shall be automatically revoked

but such license may be renewed at any time within one year following the expiration date upon

proof of continuing competency and payment of the renewal fee plus a late renewal fee. After

one year from the date of revocation, reinstatement may be made by the Board, or in its

discretion, the application may be treated as new subject to reexamination and qualification

requirements as in the case of new applications. (1919, c. 336, s. 2; C.S., s. 4995; 1951, c. 1130,

s. 2; 1957, c. 794, s. 10; 1979, c. 871, s. 1.)

RRC STAFF OPINION

PLEASE NOTE: THIS COMMUNICATION IS EITHER 1) ONLY THE RECOMMENDATION OF AN RRC

STAFF ATTORNEY AS TO ACTION THAT THE ATTORNEY BELIEVES THE COMMISSION SHOULD TAKE ON

THE CITED RULE AT ITS NEXT MEETING, OR 2) AN OPINION OF THAT ATTORNEY AS TO SOME MATTER

CONCERNING THAT RULE. THE AGENCY AND MEMBERS OF THE PUBLIC ARE INVITED TO SUBMIT THEIR

OWN COMMENTS AND RECOMMENDATIONS (ACCORDING TO RRC RULES) TO THE COMMISSION.

AGENCY: BOARD OF ARCHITECTURE

RULE CITATION: 21 NCAC 02 .0214

RECOMMENDED ACTION:

Approve, but note staff’s comment

X Object, based on:

X Lack of statutory authority

Unclear or ambiguous

Unnecessary

Failure to comply with the APA

Extend the period of review

COMMENT:

G.S. Chapter 83A only allows for certification of individuals and corporations that meet the requirements

of the Professional Corporation Act (G.S. 83A-8(a)). G.S. 57C-2-01(c) extends the authorization to

Professional Limited Liability Companies. There is no authority cited for the Board to require

registration of Limited Liability Partnerships (G.S. 59-84.2). G.S. 83A-9 specifically says that

partnerships do not need certificates. That would seem to include Limited Liability Partnerships.

ROBERT A. BRYAN, JR. COMMISSION COUNSEL

§ 83A-8. Qualification for corporate practice.

(a) Any corporation desiring to practice architecture in this State shall file corporate

application on forms provided by the Board, accompanied by the required application fee. To be

eligible for a corporate certificate, the corporation must meet all requirements of the Professional

Corporation Act.

(b) Architectural corporations of other states may be granted corporate certificates for

practice in this State upon filing application with the Board and satisfying the Board that they

meet the requirements of subsection (a) above. Such corporations shall designate the individual

or individuals licensed to practice architecture in this State who shall be in responsible charge of

all architectural work offered or performed by such corporation in this State. Such corporations

shall notify the Board of changes in such designation.

(c) All corporations holding corporate certificates from the Board shall be subject to the

applicable rules and regulations adopted by the Board, and to all the disciplinary powers

applicable to individual licensees who are officers or employees of the corporation. Corporations

may perform no acts or things forbidden to officers or employees as licensees. (1979, c. 871, s.

1.)

§ 83A-9. Partnership practice.

This Chapter neither prevents practice of architecture by a partnership nor requires

partnership seals or certificates of practice provided that the members of the partnership are duly

licensed to practice architecture, and, provided that the partnership files with the Board and

keeps current a list of the partners, their license identifications, and the types of services offered

by the partnership. (1979, c. 871, s. 1.)

§ 83A-11. Expirations and renewals.

Certificates must be renewed on or before the first day of July in each year. No less than 30

days prior to the renewal date, a renewal application shall be mailed to each individual and

corporate licensee. The completed application together with the required renewal fee shall be

returned to the Board on or before the renewal date. When the Board is satisfied as to the

continuing competency of an architect, it shall issue a renewal of the certificate. Upon failure to

renew within 30 days after the date set for expiration, the license shall be automatically revoked

but such license may be renewed at any time within one year following the expiration date upon

proof of continuing competency and payment of the renewal fee plus a late renewal fee. After

one year from the date of revocation, reinstatement may be made by the Board, or in its

discretion, the application may be treated as new subject to reexamination and qualification

requirements as in the case of new applications. (1919, c. 336, s. 2; C.S., s. 4995; 1951, c. 1130,

s. 2; 1957, c. 794, s. 10; 1979, c. 871, s. 1.)

RRC STAFF OPINION

PLEASE NOTE: THIS COMMUNICATION IS EITHER 1) ONLY THE RECOMMENDATION OF AN RRC

STAFF ATTORNEY AS TO ACTION THAT THE ATTORNEY BELIEVES THE COMMISSION SHOULD TAKE ON

THE CITED RULE AT ITS NEXT MEETING, OR 2) AN OPINION OF THAT ATTORNEY AS TO SOME MATTER

CONCERNING THAT RULE. THE AGENCY AND MEMBERS OF THE PUBLIC ARE INVITED TO SUBMIT THEIR

OWN COMMENTS AND RECOMMENDATIONS (ACCORDING TO RRC RULES) TO THE COMMISSION.

AGENCY: BOARD OF ARCHITECTURE

RULE CITATION: 21 NCAC 02 .0215

RECOMMENDED ACTION:

Approve, but note staff’s comment

X Object, based on:

X Lack of statutory authority

Unclear or ambiguous

Unnecessary

Failure to comply with the APA

Extend the period of review

COMMENT:

There is no authority cited for the last sentence in (a) prohibiting practice as an individual if the individual

otherwise meets the requirements for individual licensure.

G.S. 83A-9 specifically states that the enabling legislation does not require partnership certificates of

practice. There is therefore no authority for the Board to require them as the rule does in (e) and (f).

ROBERT A. BRYAN, JR. COMMISSION COUNSEL

§ 83A-7. Qualifications and examination requirements.

(a) Licensing by Examination. – Any individual who is at least 18 years of age and of

good moral character may make written application for examination by completion of a form

prescribed by the Board accompanied by the required application fee. Subject to qualification

requirements of this section, the applicant shall be entitled to an examination to determine his

qualifications for licensure.

(1) The qualification requirements for registration as a duly licensed architect

shall be:

a. Professional education and at least three years practical training and

experience as specified by rules of the Board.

b. The successful completion of a licensure examination in architecture

as specified by the rules of the Board.

(2) The Board shall adopt rules to set requirements for professional education,

practical training and experience, and examination which must be met by

applicants for licensure and which may be based on the published guidelines

of nationally recognized councils or agencies for the accreditation,

examination, and licensing for the architectural profession.

(b) Licensing by Reciprocity. – Any individual holding a current license for the practice

of architecture from another state or territory, and holding a certificate of qualification issued by

the National Council of Architectural Registration Boards, may upon application and within the

discretion of the Board be licensed without written examination. The Board may waive the

requirement for National Council registration if the qualifications, examination and licensing

requirements of the state in which the applicant is licensed are substantially equivalent to those

of this State and the applicant otherwise meets the requirements of this Chapter. (1915, c. 270, s.

3; 1919, c. 336, s. 1; C.S., s. 4992; 1957, c. 794, s. 7; 1971, c. 1231, s. 1; 1979, c. 871, s. 1; 1983,

c. 47; 1989, c. 62.)

§ 83A-8. Qualification for corporate practice.

(a) Any corporation desiring to practice architecture in this State shall file corporate

application on forms provided by the Board, accompanied by the required application fee. To be

eligible for a corporate certificate, the corporation must meet all requirements of the Professional

Corporation Act.

(b) Architectural corporations of other states may be granted corporate certificates for

practice in this State upon filing application with the Board and satisfying the Board that they

meet the requirements of subsection (a) above. Such corporations shall designate the individual

or individuals licensed to practice architecture in this State who shall be in responsible charge of

all architectural work offered or performed by such corporation in this State. Such corporations

shall notify the Board of changes in such designation.

(c) All corporations holding corporate certificates from the Board shall be subject to the

applicable rules and regulations adopted by the Board, and to all the disciplinary powers

applicable to individual licensees who are officers or employees of the corporation. Corporations

may perform no acts or things forbidden to officers or employees as licensees. (1979, c. 871, s.

1.)

§ 83A-9. Partnership practice.

This Chapter neither prevents practice of architecture by a partnership nor requires

partnership seals or certificates of practice provided that the members of the partnership are duly

licensed to practice architecture, and, provided that the partnership files with the Board and

keeps current a list of the partners, their license identifications, and the types of services offered

by the partnership. (1979, c. 871, s. 1.)

§ 83A-11. Expirations and renewals.

Certificates must be renewed on or before the first day of July in each year. No less than 30

days prior to the renewal date, a renewal application shall be mailed to each individual and

corporate licensee. The completed application together with the required renewal fee shall be

returned to the Board on or before the renewal date. When the Board is satisfied as to the

continuing competency of an architect, it shall issue a renewal of the certificate. Upon failure to

renew within 30 days after the date set for expiration, the license shall be automatically revoked

but such license may be renewed at any time within one year following the expiration date upon

proof of continuing competency and payment of the renewal fee plus a late renewal fee. After

one year from the date of revocation, reinstatement may be made by the Board, or in its

discretion, the application may be treated as new subject to reexamination and qualification

requirements as in the case of new applications. (1919, c. 336, s. 2; C.S., s. 4995; 1951, c. 1130,

s. 2; 1957, c. 794, s. 10; 1979, c. 871, s. 1.)

Chapter 83A.

Architects.

§ 83A-1. Definitions.

When used in this Chapter, unless the context otherwise requires:

(1) "Architect" means a person who is duly licensed to practice architecture.

(2) "Board" means the North Carolina Board of Architecture.

(3) "Corporate certificate" means a certificate of corporate registration issued by

the Board recognizing the corporation named in the certificate as meeting the

requirements for the corporate practice of architecture.

(4) "Corporate practice of architecture" means "practice" as defined in G.S.

83A-1(7) by a corporation which is organized or domesticated in this State,

and which holds a current "corporate certificate" from this Board.

(5) "Good moral character" means such character as tends to assure the faithful

discharge of the fiduciary duties of an architect to his client. Evidence of lack

of such character shall include the willful commission of an offense justifying

discipline under this Chapter, the practice of architecture in violation of this

Chapter, or of the laws of another jurisdiction, or the conviction of a felony.

(6) "License" means a certificate of registration issued by the Board recognizing

the individual named in the certificate as meeting the requirements for

registration under this Chapter.

(7) "Practice of architecture" means performing or offering to perform or holding

oneself out as legally qualified to perform professional services in connection

with the design, construction, enlargement or alteration of buildings, including

consultations, investigations, evaluations, preliminary studies, the preparation

of plans, specifications and contract documents, administration of construction

contracts and related services or combination of services in connection with

the design and construction of buildings, regardless of whether these services

are performed in person or as the directing head of an office or organization.

(1915, c. 270, s. 9; C.S., s. 4985; 1941, c. 369, s. 3; 1951, c. 1130, s. 1; 1957,

c. 794, ss. 1, 2; 1979, c. 871, s. 1.)

§ 83A-6. Board rules; bylaws; standards of professional conduct.

(a) The Board shall have the power to adopt bylaws, rules, and standards of professional

conduct to carry out the purposes of this Chapter, including, but not limited to:

(1) The adoption of bylaws governing its meetings and proceedings;

(2) The establishment of qualification requirements for admission to

examinations, and for individual or corporate licensure as provided in G.S.

83A-7 and 83A-8;

(3) The establishment of the types and contents of examinations, their conduct,

and the minimum scores or other criteria for passing such examinations;

(4) The adoption of mandatory standards of professional conduct concerning

misrepresentations, conflicts of interest, incompetence, disability, violations

of law, dishonest conduct, or other unprofessional conduct for those persons

or corporations regulated by this Chapter, which standards shall be

enforceable under the disciplinary procedures of the Board;

(5) The establishment or approval of requirements for renewal of licenses

designed to promote the continued professional development and competence

of licensees. Such requirements shall be designed solely to improve the

professional knowledge and skills of a licensee directly related to the current

and emerging bodies of knowledge and skills of the licensee's profession.

When necessary to protect the public health, safety, or welfare, the Board shall require such

evidence as it deems necessary to establish the continuing competency of architects as a

condition of renewal of licenses.

(b) The Board shall not adopt any rule or regulation which prohibits advertising.

(c) The adoption, amendment or revocation of rules, regulations, and standards of

professional conduct, and the publication and distribution of the same shall be subject to the

provisions of the Administrative Procedure Act. (1979, c. 871, s. 1.)

§ 83A-7. Qualifications and examination requirements.

(a) Licensing by Examination. – Any individual who is at least 18 years of age and of

good moral character may make written application for examination by completion of a form

prescribed by the Board accompanied by the required application fee. Subject to qualification

requirements of this section, the applicant shall be entitled to an examination to determine his

qualifications for licensure.

(1) The qualification requirements for registration as a duly licensed architect

shall be:

a. Professional education and at least three years practical training and

experience as specified by rules of the Board.

b. The successful completion of a licensure examination in architecture

as specified by the rules of the Board.

(2) The Board shall adopt rules to set requirements for professional education,

practical training and experience, and examination which must be met by

applicants for licensure and which may be based on the published guidelines

of nationally recognized councils or agencies for the accreditation,

examination, and licensing for the architectural profession.

(b) Licensing by Reciprocity. – Any individual holding a current license for the practice

of architecture from another state or territory, and holding a certificate of qualification issued by

the National Council of Architectural Registration Boards, may upon application and within the

discretion of the Board be licensed without written examination. The Board may waive the

requirement for National Council registration if the qualifications, examination and licensing

requirements of the state in which the applicant is licensed are substantially equivalent to those

of this State and the applicant otherwise meets the requirements of this Chapter. (1915, c. 270, s.

3; 1919, c. 336, s. 1; C.S., s. 4992; 1957, c. 794, s. 7; 1971, c. 1231, s. 1; 1979, c. 871, s. 1; 1983,

c. 47; 1989, c. 62.)


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