GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 1993

S	1 

SENATE BILL 360

Short Title:  GPAC/DHR Unit Reorg.	(Public)
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Sponsors: Senator Martin of Guilford.
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Referred to:  Government Performance Audit.
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February 24, 1993

A BILL TO BE ENTITLED
AN ACT TO IMPLEMENT A RECOMMENDATION OF THE GOVERNMENT PERFORMANCE AUDIT COMMITTEE TO REORGANIZE CERTAIN MISPLACED ORGANIZATIONAL UNITS IN THE DEPARTMENT OF HUMAN RESOURCES, AND TO MAKE ADMINISTRATIVE CHANGES IN THE CHARITABLE SOLICITATION LAW.
The General Assembly of North Carolina enacts:
Section 1.  The General Assembly finds that, if organizational units within departments are misplaced, vital fiscal and human resources are wasted in unnecessary management positions and in excessive coordination of services.  The General Assembly further finds that several organizational units and positions are organizationally misplaced in the Department of Human Resources.
Sec. 2.  (a) All of the powers, duties, budget, and functions of the Charitable Solicitation Unit of the Division of Facility Services, Department of Human Resources, are transferred to the Department of Justice, Office of the Attorney General, Consumer Protection Section.  This transfer has all the elements of a Type I transfer, as defined in G.S. 143A-6.
(b) G.S. 131C-3(3) and G.S. 131C-3(10) are repealed.
(c) G.S. 131C-3(5) reads as rewritten:
"(5)	 'Department' means the Department of Justice."
(d) G.S. 131C-4(a) reads as rewritten:
"(a)	Any person who solicits charitable contributions shall apply for and obtain an annual license from the Department.  A person who is authorized to solicit on behalf of a licensed or exempt person is not required to obtain a license under this section."
(e) G.S. 131C-7(a)(6) reads as rewritten:
"(6)	A copy of a financial statement in a consolidated report audited by an independent public accountant for the person's immediately preceding fiscal year or, if none, for the present fiscal year or part thereof; provided that if total support and revenue exceeds two hundred fifty thousand dollars ($250,000) for the fiscal year or part thereof, the report shall be audited by a certified public accountant. Information as to the total support and revenue and all of the fund-raising activities including the balance sheet, kind and amounts of funds raised, costs and expenses incidental thereto, allocation or disbursement of funds raised, changes in fund balances, notes to the audit and the opinion as to the fairness of the presentation by the accountant shall be included. This report shall conform to the accounting and reporting procedures established by the Attorney General. The Attorney General shall adopt rules for simplified reporting by persons whose total support and revenue is one hundred thousand dollars ($100,000) or less."
(f) G.S. 131C-8(a) reads as rewritten:
"(a)	An application for licensure shall be in writing, verified under oath or affirmation and shall contain such information as specified in G.S. 131C-7 as the Attorney General shall require. In addition, the application shall contain:
(1)	The name and address of all officers, employees and agents;
(2)	The name and address of all persons who own a ten percent (10%) or more interest in the applicant; and
(3)	A description of any other business conducted by the applicant or any person who owns a ten percent (10%) or more interest in the applicant."
(g) G.S. 131C-9(a) reads as rewritten:
"(a)	An application for licensure under G.S. 131C-4 or 131C- 6 shall be accompanied by a fee not to exceed one hundred dollars ($100.00) in accordance with a fee schedule established by the Attorney General."
(h) G.S. 131C-10 reads as rewritten:
"§ 131C-10. Bond.
An applicant under G.S. 131C-6 shall, at the time of making application, file with and have approved by the Department a bond in which the applicant shall be the principal obligor in the sum of twenty thousand dollars ($20,000) with one or more sureties satisfactory to the Department, whose liability in the aggregate as such sureties will at least equal the said sum; and the applicant shall maintain said bond in effect so long as the license is in effect. The bond shall run to the State for the use of said bond for any penalties and to any person who may have a cause of action against the obligor of the bond for any losses resulting from the obligor's conduct of any and all activities subject to this Chapter or arising out of a violation of this Chapter or any rule of the Attorney General. A bond shall not be required of any applicant who does not personally receive any of the contributions collected and who does not personally handle any of the contributions expended. In lieu of the bond required under this section, an applicant may submit a certificate of deposit in the amount of twenty thousand dollars ($20,000) that is either payable to the State and unrestrictively endorsed to the Department; or in the case of a negotiable certificate of deposit, is unrestrictively endorsed to the Department; or, in the case of a nonnegotiable certificate of deposit, is assigned to the Department in a form satisfactory to the Department.  Access to the certificate of deposit in favor of the State is subject to the same conditions as for a bond under this section and shall extend for a period not less than four years after the licensee ceases activities that are subject to this Chapter.  The Department shall deliver to the State Treasurer certificates of deposit submitted under this section."
(i) G.S. 131C-12 reads as rewritten:
"§ 131C-12. Rule-making authority.
The Attorney General shall adopt rules necessary for the implementation of this Chapter and to prevent false and deceptive statements and conduct in the solicitation of charitable contributions."
(j) G.S. 131C-13 reads as rewritten:
"§ 131C-13. Fiscal records.
Any person subject to licensure under this Chapter shall maintain accurate fiscal records in accordance with rules adopted by the Attorney General."
(k) G.S. 131C-18 reads as rewritten:
"§ 131C-18. Duty of Attorney General to investigate.
The Attorney General shall investigate, from time to time, the activities of all persons soliciting charitable contributions in this State, which are or may in his opinion be subject to this Chapter, or which have or may have violated the provisions of this Chapter. Such investigation shall be with a view of ascertaining whether this Chapter is being or has been violated by any such person, and if so, in what respect, with the purpose of acquiring such information as may be necessary to enable the Attorney General to grant or deny an application for licensure, to revoke a license, to seek an injunction against any person, or to take any other action pursuant to this Chapter."
(l) G.S. 131C-19 reads as rewritten:
"§ 131C-19. Power to compel examination.
In performing the duty required in G.S. 131C-18, the Attorney General may, at all times, to require the officers, agents or employees of any person soliciting charitable contributions in this State and all other persons having knowledge with respect to the matters and activities of such persons, to submit themselves to examination, and produce for inspection any of the books and papers of any such persons, or which are in any way connected with the business thereof; and the Attorney General may administer oath to any person under examination.   The Attorney General may apply to any justice or judge of the appellate or superior court divisions, after five days notice of application, for an order on any person under examination to appear and be examined, and disobedience of such order shall constitute contempt, and shall be punishable as in other cases of disobedience of a proper order of such judge."
(m) G.S. 131C-21 reads as rewritten:
"§ 131C-21. Injunction.
If any person shall violate or threaten to violate any provision of this Chapter, the Attorney General may institute an action in the Superior Court of Wake County for injunctive relief against such violation or threatened violation."
	(n) Rules adopted by the Social Services Commission regulating the Charitable Solicitation Act remain in effect until rewritten or repealed by the Attorney General.
(o) This section becomes effective October 1, 1993, and applies to charitable solicitations required on or after that date.
Sec. 3.  All of the powers, duties, and functions of the Employee Assistance Program (EAP) Branch, Department of Human Resources, that are responsible for identifying troubled employees throughout the Department of Human Resources and assisting them to find personal counseling help or to access the appropriate referral resources and that also assist the area mental health programs through promotion, training, and support of area EAP procedures, are transferred to the Division of Personnel Management Services in the Office of the Secretary.
Sec. 4.  All of the powers, duties, and functions of the Adult Services Branch/Controlled Substance Regulatory Unit, Department of Human Resources, that is responsible for implementing the regulatory responsibilities of the North Carolina Controlled Substance Act and that does licensing and inspection of drug-related facilities in order to prevent legitimately manufactured, distributed, or dispensed controlled substances from being delivered into the illicit market, are transferred to the Division of Facility Services.
Sec. 5.  The Computer Systems Analyst IV position in the Division of Vocational Rehabilitation, Department of Human Resources, is transferred to the Division's Administrative Services Section for better coordination in implementing the Division's computer system.
Sec. 6.  The Staff Development Specialist position located in the Program Operations and Support Section of the Division of Vocational Rehabilitation, Department of Human Resources, is transferred to the Division's Administrative Services Section to eliminate fragmentation of the computer program automation function.
Sec. 7.  This act becomes effective July 1, 1993.