GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 1989

S	1 

SENATE BILL 857

Short Title:  Admin. Adjudicator Status.	(Public)
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Sponsors: Senator Barker. (By Request)
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Referred to:  Rules.
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April 12, 1989

A BILL TO BE ENTITLED
AN ACT TO CONFIRM THE STATUS OF THE UTILITIES COMMISSION, THE INDUSTRIAL COMMISSION AND THE OFFICE OF ADMINISTRATIVE HEARINGS AS INDEPENDENT ADJUDICATIVE AGENCIES UNDER ARTICLE III, SECTION 11, AND ARTICLE IV, SECTION 3 OF THE CONSTITUTION, TO PROVIDE FOR THEIR ADMINISTRATION, AND TO EQUALIZE THE SALARIES, BENEFITS AND POWERS OF ADMINISTRATIVE ADJUDICATORS.
The General Assembly of North Carolina enacts:
Section 1.  A new Chapter 143C is added to the General Statutes to provide for, and consolidate the statutes related to, the establishment of the independent, quasi-judicial agencies of State government contemplated by Article IV, Section 3, and to provide for their administration in accordance with Article III, Section 11, of the Constitution.
Sec. 2.  Article 1 of Chapter 143C of the General Statutes is enacted to read:
“Chapter 143C.
"Administrative Adjudicatory Agencies.
"ARTICLE 1.
"Purpose.
"§ 143C-1. Policy.
The Constitution mandates that the three powers of State government are, and should remain, separate. Necessity requires and the Constitution permits the establishment of independent administrative agencies with such judicial powers as are reasonably necessary to carry out the purposes for which they are created.
"§ 143C-2. Adjudicatory agencies.
(a)	The North Carolina Utilities Commission, the North Carolina Industrial Commission and the Office of Administrative Hearings have been established for purposes that require judicial powers for their accomplishment. Those three agencies constitute and may be referred to as ‘the adjudicatory agencies.'
(b)	The Utilities Commission has the responsibilities set forth in Chapter 62 of the General Statutes.
(c)	The Industrial Commission has the responsibilities set forth in Chapter 97 of the General Statutes.
(d)	The Office of Administrative Hearings has the responsibilities set forth in Chapter 150B of the General Statutes.
(e)	Nothing in this Chapter shall limit the authority of the General Assembly to vest reasonably necessary judicial powers, within constitutional limits, in administrative agencies other than the adjudicatory agencies by specific statute.
"§ 143C-3. Independent status.
The Utilities Commission, the Industrial Commission and the Office of Administrative Hearings are independent, quasi-judicial, administrative agencies under Article III, Section 11 of the Constitution and are not allocated within a principal department.
"§ 143C-4. Administrative services.
Administrative support for the adjudicatory agencies shall be provided by the Administrative Services Division as set out in Article 5 of this Chapter."
Sec. 3.  G.S. 62-10 through G.S. 62-29 are recodified as G.S. 143C-10 through G.S. 143C-29 respectively and shall constitute Article 2 of Chapter 143C of the General Statutes, to be entitled "Utilities Commission."
The Revisor of Statutes shall change references to G.S. 62-10 through G.S. 62-98 wherever they appear in the General Statutes to conform to the renumbering resulting from this recodification.
Sec. 4.  G.S. 97-77 through G.S. 97-81 are recodified as G.S. 143C-31 through G.S. 143C-35 respectively and shall constitute Article 3 of Chapter 143C of the General Statutes, to be entitled "Industrial Commission."
The Revisor of Statutes shall change references to G.S. 97-77 through G.S. 97-81 wherever they appear in the General Statutes to conform to the renumbering resulting from this recodification.
Sec. 5.  G.S. 7A-750 through G.S. 7A-759 are recodified as G.S. 143C-40 through G.S. 143C-49 respectively and shall constitute Article 4 of Chapter 143C of the General Statutes to be entitled "Office of Administrative Hearings."
The Revisor of Statutes shall change references to G.S. 7A-750 through G.S. 7A-759 wherever they appear in the General Statutes to conform to the renumbering resulting from this recodification.
Sec. 6.  G.S. 62-10(h) and (i), which are recodified by Section 3 of this act as G.S. 143C-10(h) and (i), read as rewritten:
"(h)	The salary of each commissioner shall be the same as that fixed from time to time for judges of the superior court except that the commissioner designated as chairman shall receive the salary fixed for a senior resident judge of superior court. In lieu of merit and other increment raises paid to regular State employees, each commissioner, including the commissioner designated as chairman, shall receive as longevity pay an annual amount payable monthly at the rates provided in G.S. 7A-65 and based upon his years of State service. The salary of each hearing examiner employed by the Commission shall be the same as that provided from time to time for judges of the district court, except that one such hearing examiner may be designated senior hearing examiner and he shall receive the salary provided for a chief district court judge. Notwithstanding the provisions of G.S. 126-5(c1)(5), such hearing examiners shall be subject to the State Personnel Act.
(i)	The standards of judicial conduct provided for judges in Article 30 Chapter 7A of the General Statutes shall apply to members of the Commission and to hearing examiners employed by the Commission. Members of the Commission shall be liable to impeachment for the causes and in the manner provided for judges of the General Court of Justice in Chapter 123 of the General Statutes. Hearing examiners shall be subject to discharge for just cause for violation of such standards. Members of the Commission and hearing examiners shall not engage in any other employment, business, profession, or vocation while in office."
Sec. 7.  G.S. 62-14, which is recodified by Section 3 of this act as G.S. 143C-14, is amended by adding a new subsection to read:
"( d)	The Commission may employ an executive assistant whose duties shall be prescribed by the Chairman and who, upon entering upon his duties, shall give bond in such sum as may be fixed by the Commission, and who shall be subject to the State Personnel Act except that he may be removed at the will of the Chairman."
Sec. 8.  G.S. 97-2(8) reads as rewritten:
"(8)	Commission. – The term ‘Commission' means the North Carolina Industrial Commission."
Sec. 9.  G.S. 97-77, which is recodified by Section 4 of this act as G.S. 143C-31, reads as rewritten:
"§.members appointed by Governor; terms of office; chairman.
There is hereby created a commission to be known as the North Carolina Industrial Commission, consisting of three commissioners who shall devote their entire time to the duties of the Commission. The Governor shall appoint the members of the Commission subject to confirmation by the General Assembly in joint session.  The terms of each member serving on June 30, 1989, are extended by two years. Upon the expiration of each term as above mentioned, the Governor shall appoint a successor for a term of eight years, and thereafter the term of office of each commissioner shall be eight years. The names of commissioners to be appointed by the Governor shall be submitted by the Governor to the General Assembly for confirmation by the General Assembly on or before May 1 of the year in which the terms for which the appointments are to be made are to expire. Upon failure of the Governor to submit names as herein provided, the President of the Senate and Speaker of the House of Representatives jointly shall submit the names of a like number of commissioners to the General Assembly on or before May 15 of the same year for confirmation by the General Assembly. Regardless of the way in which names of commissioners are submitted, confirmation of commissioners must be accomplished prior to adjournment of the then current session of the General Assembly. Not more than one appointee shall be a person who, on account of his previous vocation, employment or affiliations, can be classed as a representative of employers, and not more than one appointee shall be a person who, on account of his previous vocation, employment or affiliations, can be classed as a representative of employees. One member, to be designated by the Governor, shall act as chairman."
Sec. 10.  G.S. 97-78(a) and (b), which are recodified by this act as G.S. 143C-32(a) and (b), read as rewritten:
"(a)	The salaries of the chairman and each of the other commissioners shall be the same as those of the chairman and the members of the Utilities Commission respectively.  In lieu of merit and other increment raises paid to regular State employees, each commissioner, including the commissioner designated as chairman, shall receive as longevity pay an annual amount payable monthly at the rates provided in G.S. 7A-65 and based upon his years of State service.
(b)	The Commission may appoint an executive assistant whose duties shall be prescribed by the Commission, and who shall be subject to the State Personnel System and who, upon entering upon his duties, shall give bond in such sum as may be fixed by the Commission, and who may be removed at the will of the Commission. The Commission may also employ such clerical or other assistance as it may deem necessary. The salaries and compensation of all such personnel shall be fixed in the manner provided by law for fixing and regulating salaries and compensation by other State agencies."
Sec. 11.  G.S. 97-79(b), which is recodified by Section 4 of this act as G.S. 143C-33(b), reads as rewritten:
"(b)	The Commission may appoint deputies who shall have the same power to issue subpoenas, administer oaths, conduct hearings, hold persons, firms or corporations in contempt as provided in Chapter 5A of the General Statutes, take evidence, and enter orders, opinions, and awards based thereon as is possessed by the members of the Commission. The salary of each deputy shall be the same as that provided for hearing examiners of the Utilities Commission except that one such deputy may be designated chief deputy and he shall receive the salary provided for the senior hearing examiner. Notwithstanding the provisions of G.S. 126-5(c1)(5), such deputy or deputies shall be subject to the State Personnel Act."
Sec. 12.  G.S. 97-79, which is recodified by Section 4 of this act as G.S. 143C-32, is amended by adding a new subsection to read:
"( f)	The standards of judicial conduct provided for judges in Article 30, Chapter 7A of the General Statutes shall apply to members of the Commission and their deputies. Members of the Commission shall be liable to impeachment for the causes and in the manner provided for judges of the General Court of Justice in Chapter 123 of the General Statutes. Deputy commissioners shall be subject to discharge for just cause for violation of such standards. Members of the Commission and deputy commissioners shall not engage in any other employment, business, profession, or vocation while in office."
Sec. 13.  G.S. 7A-751, which is recodified by Section 5 of this act as G.S. 143C-41, reads as rewritten:
"§ s The head of the Office of Administrative Hearings is the Chief Administrative Law Judge.  He shall serve as Director and have the powers and duties conferred on him by this Chapter and the Constitution and laws of this State.  His salary shall be the same as is provided for the Chairman of the Utilities Commission and the Chairman of the Industrial Commission.
In lieu of merit and other increment raises, the Chief Administrative Law Judge shall receive as longevity an annual amount payable monthly at the rates provided in G.S. 7A-65 and based upon his years of State service."
Sec. 14.  G.S. 7A-752, which is recodified by Section 5 of this act as G.S. 143C-42, reads as rewritten:
"§ svacancy.
(a)	The Chief Administrative Law Judge of the Office of Administrative Hearings shall be appointed by the Chief Justice for a term of office of four years subject to confirmation by the General Assembly in joint session, provided that the term of the Chief Administrative Law Judge serving on June 30, 1989, under the provisions of G.S. 7A-752 shall expire on June 30, 1993. Successors to such Chief Administrative Law Judge shall be appointed for a term to begin on July 1 of the year the preceding term ends and to end on June 30 eight years later. 
(b)	The name of a Chief Administrative Law Judge to be appointed by the Chief Justice shall be submitted by the Chief Justice to the General Assembly for confirmation by the General Assembly on or before May 1 of the year in which the term for which the appointment is to be made is to expire. Upon failure of the Chief Justice to submit a name as herein provided, the President of the Senate and Speaker of the House of Representatives jointly shall submit a name to the General Assembly on or before May 15 of the same year for confirmation by the General Assembly. Regardless of the way in which the name is submitted, confirmation must be accomplished prior to adjournment of the then current session of the General Assembly."
Sec. 15.  G.S. 7A-753, which is recodified by Section 5 of this act as G.S. 143C-43, reads as rewritten:
"§ sappointment; specialization.
(a)	The Chief Administrative Law Judge shall appoint additional administrative law judges to serve in the Office of Administrative Hearings in such numbers as the General Assembly provides. No person shall be appointed or designated an administrative law judge except as provided in this Article.
(b)	The Chief Administrative Law Judge may designate certain administrative law judges as having the experience and expertise to preside at specific types of contested cases and assign only these designated administrative law judges to preside at those cases.
(c)	The salary of each such administrative law judge shall be the same as that provided for hearing examiners of the Utilities Commission and deputy commissioners of the Industrial Commission except that the senior administrative law judge shall receive the same salary provided for the senior hearing examiner and the chief deputy. Notwithstanding the provisions of G.S. 126-5(c1)(5), administrative law judges shall be subject to the State Personnel Act."
Sec. 16.  G.S. 7A-754, which is recodified by Section 5 of this act as G.S. 143C-44, reads as rewritten:
"§ sremoval.
(a)	Only persons duly authorized to practice law in the General Court of Justice shall be eligible for appointment as the Director and chief administrative law judge or as an administrative law judge in the Office of Administrative Hearings. Neither the chief administrative law judge nor any administrative law judge may engage in the private practice of law as defined in G.S. 84-2.1 while in office; violation of this provision shall be grounds for removal. Each administrative law judge shall take the oaths required by Chapter 11 of the General Statutes. An administrative law judge may be removed from office by the Director of the Office of Administrative Hearings for just cause, as that term is used in G.S. 126-35.
(b)	The standards of judicial conduct provided for judges in Article 30, Chapter 7A of the General Statutes shall apply to the Chief Administrative Law Judge and each administrative law judge. The Chief Administrative Law Judge shall be liable to impeachment for the causes and in the manner provided for judges of the General Court of Justice in Chapter 123 of the General Statutes. Administrative law judges shall be subject to discharge for just cause for violation of such standards."
Sec. 17.  G.S. 7A-756, which is recodified by Section 5 of this act as G.S. 143C-46, reads as rewritten:
"§ 7Assubpoenas
			Powers of administrative law judge.
The Chief Administrative Law Judge and all administrative law judges have the same power to compel the attendance of witnesses, require the examination of persons and parties, and compel the production of books and papers, and punish for contempt, as by law is conferred on members of the Utilities Commission or the Industrial Commission."
Sec. 18.  G.S. 150B-33(b) reads as rewritten:
"(b)	An administrative law judge may:
(1) 	Administer oaths and affirmations;
(2) 	Sign and issue subpoenas in the name of the Office of Administrative Hearings, requiring attendance and giving of testimony by witnesses and the production of books, papers, and other documentary evidence;
(3) 	Provide for the taking of testimony by deposition;
(4) 	Regulate the course of the hearings, including discovery, set the time and place for continued hearings, and fix the time for filing of briefs and other documents;
(5) 	Direct the parties to appear and confer to consider simplification of the issues by consent of the parties;
(6) 	Stay the contested action by the agency pending the outcome of the case, upon such terms as he deems proper, and subject to the provisions of G.S. 1A-1, Rule 65;
(7) 	Determine whether the hearing shall be recorded by a stenographer or by an electronic device; and
	(9) 	Determine that a rule as applied in a particular case is void because (1) it is not within the statutory authority of the agency, (2) is not clear and unambiguous to persons it is intended to direct, guide, or assist, or (3) is not reasonably necessary to enable the agency to perform a function assigned to it by statute or to enable or facilitate the implementation of a program or policy in aid of which the rule was adopted.
(10)	Impose the sanctions provided for in G.S. 1A-1 or Chapter 3 of Title 26 of the North Carolina Administrative Code for noncompliance with applicable procedural rules."
Sec. 19.  Article 5 of Chapter 143C of the General Statutes is enacted to read:
“ARTICLE 5.
"Administrative Services.
"§ 143C-60. Administrative Services Division.
(a)	There is hereby created an Administrative Services Division for the adjudicatory agencies which will be responsible for the provision of all administrative services to the Utilities Commission, the Industrial Commission and the Office of Administrative Hearings. The Division shall be a concomitant part of each of those agencies and shall have equal responsibilities of each of them.
(b)	The Chairman of the Utilities Commission, the Chairman of the Industrial Commission and the Chief Administrative Law Judge shall constitute a management committee to oversee the operations of the Administrative Services Division. The one among them senior in State service shall act as chairman.
"§ 143C-61. Director.
(a)	The Administrative Services Division shall have a Director who is responsible for its operations to the management committee. His salary shall be the same as is provided from time to time for the Assistant Administrative Officer of the Courts.
(b)	Subject to the provisions of subsection (c) the Director shall be appointed by the management committee and he shall be subject to the State Personnel Act.
(c)	The person serving as Deputy Director of the Office of Administrative Hearings on June 30, 1989, shall serve as the initial Director of the Administrative Services Division.
"§ 143C-62. Services; budgets.
(a)	The services to be provided to the adjudicatory agencies by the Administrative Services Division shall include, but not be limited to, budget, personnel, payroll, purchasing, printing and duplicating, telephone, travel, library, reporting of hearings and transcript preparation, and acquisition of offices and other physical plant requirements.
(b)	Separate appropriations for operations shall be made for each of the adjudicatory agencies and for the Administrative Services Division and shall be identified by individual budget codes. Separate budgets for each of the adjudicatory agencies and for the Administrative Services Division shall be maintained and administered by the Administrative Services Division.
(c)	Except as specifically provided by law, the adjudicatory agencies and the Administrative Services Division shall be subject to statutes and rules governing the administrative operation of State agencies generally.
(d)	Employees of the Administrative Services Division, including the Director, the provisions of G.S. 126-5(c1)(5) notwithstanding, shall be subject to the State Personnel Act."
Sec. 20. (a) The North Carolina Utilities Commission is separated from the Department of Commerce and it is given the status of an independent agency. It shall retain its statutory authority, powers, duties, functions, records and personnel. Its property, unexpended balances of appropriations, allocations or other funds, and the functions of budgeting and purchasing, are assigned to the Administrative Services Division of the adjudicatory agencies for the benefit of the Utilities Commission.
(b) The North Carolina Industrial Commission is separated from the Department of Commerce and it is given the status of an independent agency. It shall retain its statutory authority, powers, duties, functions, records and personnel. Its property, unexpended balances of appropriations, allocations or other funds, and the functions of budgeting and purchasing, are assigned to the Administrative Services Division of the adjudicatory agencies for the benefit of the Industrial Commission.
(c) The status of the Office of Administrative Hearings as an independent agency is reconfirmed. It shall retain its statutory authority, powers, duties, functions, records and personnel. Its property, unexpended balances of appropriations, allocations or other funds, and the functions of budgeting and purchasing, are assigned to the Administrative Services Division of the adjudicatory agencies for the benefit of the Office of Administrative Hearings.
(d) Notwithstanding the provisions of subsections (a), (b) and (c), employees of the Department of Commerce and of the Office of Administrative Hearings whose primary duties are to provide budget, personnel, purchasing, case reporting or similar or related services for the Utilities Commission, the Industrial Commission or the Office of Administrative Hearings are transferred to the Administrative Services Division of the adjudicatory agencies together with the unexpended balances of appropriations, allocations or other funds supporting them.
(e) Notwithstanding any other provision of law, no employee whose position is redesignated, transferred or reallocated or whose salary is established by this act shall be reduced in salary, grade or step as a result of the redesignation, transfer or reallocation or by any personnel action: provided that nothing herein shall be construed to prevent disciplinary action under G.S. 126-35. Positions previously classified by the General Assembly under Section 68(a) of Chapter 830 of the 1987 Session Laws, except administrative law judges, are made subject to the State Personnel Act by this act but shall not be reclassified downward by the Office of State Personnel or the State Personnel Commission. Any employee transferred by this act who is performing duties substantially comparable to an employee in a higher classification shall be reclassified upward to equalize the grades and duties.
Sec. 21.  The fourth sentence of Section 19 of Chapter 746, Session Laws of 1985, as amended by Section 7 of Chapter 1022, Session Laws of 1987, is repealed.
Sec. 22.  This act shall become effective July 1, 1989.