GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 1995

S	6 

SENATE BILL 52*
Agriculture/Environment/Natural Resources Committee Substitute Adopted 2/7/95
House Committee Substitute Favorable 5/3/95
House Committee Substitute #2 Favorable 6/14/95
House Committee Substitute #3 Favorable 6/29/95
House Committee Substitute #4 Favorable 7/11/95

Short Title:  State-Owned Submerged Lands.	(Public)

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Sponsors:

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Referred to:  

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January 26, 1995

A BILL TO BE ENTITLED
AN ACT TO AMEND THE PROVISIONS OF CHAPTER 146 CONCERNING STATE-OWNED SUBMERGED LANDS.
The General Assembly of North Carolina enacts:
Section 1.  G.S. 146-1 reads as rewritten:
"§ 146-1.  Intent of Subchapter.
(a)	It is the purpose and intent of this Subchapter to vest in the Department of Administration, subject to rules and regulations adopted by the Governor and approved by the Council of State as hereinafter provided, responsibility for the management, control and disposition of all vacant and unappropriated lands, swamplands, lands acquired by the State by virtue of being sold for taxes, and submerged lands, title to which is vested in the State or in any State agency, to be exercised subject to the provisions of this Subchapter.
(b)	Further, it is the intent of this Subchapter to establish within the Department, a method for obtaining easements for State-owned submerged lands or lands covered by navigable waters that includes compensation, recognizes the common law rights of riparian or littoral property owners, and balances those rights with the State's obligation to protect public trust rights for all of its citizens.  The North Carolina General Assembly finds that the State is unable to provide the necessary access for its citizens to exercise public trust rights and, therefore, recognizes the role that publicly and privately owned piers, docks, wharves, marinas, and other structures located in or over submerged lands or lands covered by navigable waters generally serve in furthering public trust purposes including:
(1)	Providing citizens with access and ability to exercise public trust boating, fishing, and swimming activities;
(2)	Enhancing the value of appurtenant upland property values with the resulting increased collection of ad valorem taxes;
(3)	Enhancing tourism which is essential to the economy of the State and, in particular, to the coastal counties; and
(4)	Increasing local participation in boating and fishing activities with the resulting increase in taxes paid for fuel, fishing tackle, boat equipment, and imported boats and motors which taxes contribute to the sound economy of the State, and some of which are paid into the federal Wallop-Breaux Fund for redistribution to the State for water resource enhancements and water access improvements.
(c)	Nothing in this Subchapter shall be construed to limit the full exercise of common law riparian or littoral rights."
Sec. 2.  G.S. 146-12 reads as rewritten:
"§ 146-12.  Easements in lands covered by water.
(a)	The Department of Administration may grant, to adjoining riparian or littoral owners, easements in lands covered by navigable waters or by the waters of any lake owned by the State for such purposes and upon such conditions as it may deem proper, with the approval of the Governor and Council of State. The Department may, with the approval of the Governor and Council of State, revoke any such easement upon the violation by the grantee or his assigns of the conditions upon which it was granted.
Every such easement shall include only the front of the tract owned by the riparian or littoral owner to whom the easement is granted, shall extend no further than the deep water, and shall in no respect obstruct or impair navigation.
When any such easement is granted in front of the lands of any incorporated town, the governing body of the town shall regulate the line on deep water to which wharves may be built.
(b)	Easements Not Requiring Approval by the Governor or Council of State. – In accordance with the provisions in subsections (c) through (m) of this section, the Department of Administration shall grant easements in State-owned submerged lands or lands covered by navigable waters without the approval of the Governor and the Council of State for:
(1)	Existing structures permitted under Article 7 of Chapter 113A or structures existing prior to the effective date of the permitting requirements of Article 7 of Chapter 113A of the General Statutes.
(2)	New structures permitted under Article 7 of Chapter 113A of the General Statutes after the effective date of this section.
(c)	Voluntary Easement Applications for Existing Structures. – Riparian or littoral property owners of existing structures may voluntarily obtain an easement under subsection (b) of this section in accordance with the procedures set forth in this section.  For purposes of this section, the term 'existing structures' means all presently existing piers, docks, marinas, wharves, and other structures located over or upon State-owned submerged lands or lands covered by navigable waters.  Applications for voluntary easements shall be received by the State Property Office within 36 months of the effective date of this section.
(d)	Notification of Availability of Voluntary Easements. – The State Property Office shall provide public notice of the availability of voluntary easements by placing an advertisement in one newspaper of general circulation in each of the coastal counties identified under G.S. 113A-103(2) at least once every six months during the 36-month period.  The final notice shall be placed at least 30 days prior to the expiration of the 36-month period.
(e)	Mandatory Easement Applications for New Structures. – Riparian or littoral property owners of new structures shall obtain an easement under subsection (b) of this section in accordance with the procedures set forth in this section.
(f)	Easement Application. – An application by a riparian or littoral owner of a new or existing structure for an easement under subsection (b) of this section shall include all of the following and shall:
(1)	Be made in writing to the State Property Office and include the full name and address of the easement applicant.
(2)	Include a plat depicting the footprint and total square footage of all structures located in or over submerged lands or lands covered by navigable waters.  The footprint shall include the total square footage of the area of State-owned submerged lands or lands covered by navigable waters that are enclosed on three or more sides by any structure.
(3)	Include a copy of any 'CAMA' permit  required for structures under Article 7 of Chapter 113A of the General Statutes.
(4)	Include a copy of the deed or other instrument through which the applicant establishes ownership of the adjacent riparian or littoral property.
(5)	Specify the use or uses associated with the structure to be covered by the easement.
(6)	Include the appropriate easement purchase payment.
(g)	Easement Terms. – Any easement granted under subsection (b) of this section shall be in a form suitable for recordation and shall be executed by either the Director or Deputy Director of the State Property Office.  The terms of each easement shall provide that the easement:
(1)	Is appurtenant to specifically described, adjacent riparian or littoral property and runs with the land.
(2)	Specifies that the holder of the easement shall not exclude or prevent the public from exercising public trust rights, including commercial and recreational fishing, shellfishing, shellfish leases and franchises, seine netting, pound netting, and other fishing rights.
(3)	Is valid for a term of 50 years from the date of issuance.
(4)	Is eligible for one renewal term of 50 years.
(5)	Is granted in the public interest for good and valuable consideration received by the State.
(6)	Specifies by metes and bounds description or attached plat the footprint of the structure for which the easement is issued.
(7)	Describes the uses for which the easement is being granted, including:
a.	The right of reasonable access for all vessels traditionally used in the main watercourse area to deep water or, where present, to a specified navigational channel;
b.	The right to moor vessels at or adjacent to the structure;
c.	The right to enhance or improve the adjacent riparian or littoral property; and
d.	All other reasonable, nonexclusive public trust uses as specified in the easement application, to the extent not otherwise limited by provisions of this Subchapter or any other law.
(8)	Specifies that rights granted include the right to repair, rebuild, or restore existing structures to the original structure dimensions consistent with all applicable provisions in this Subchapter or other law.
(9)	Specifies that the exercise of any rights under the easement shall be contingent upon obtaining all required permits.
(h)	Easement Purchase Payment. – The annual rental for an easement under this section shall be fair market value on a per acre of footprint coverage rounded up to the nearest quarter acre.
(i)	Easement Issuance. – Within 75 days of receipt of a completed application under subsection (f) of this section, the Director or Deputy Director of the State Property Office shall issue the requested easement in a form sufficient for recording in the register of deeds of the county or counties in which any part of the structure is located.  The act of easement issuance under subsection (b) of this section shall be exempt from the provisions in Chapter 150B of the General Statutes.  Failure to issue the requested easement within 75 days of receipt of a completed application and any applicable easement purchase payments shall be treated as issuance of the requested easement and shall entitle the applicant to execution and issuance of the easement.
(j)	Easement Renewal. – Upon written request from the current easement holder, easements shall be renewed for one additional term of 50 years.  Renewal easements shall be subject to the terms, conditions, and purchase payments applicable to initial easements at the time of renewal.  Written notification of expiring easements shall be provided by the State Property Office at least 180 days prior to expiration of the initial easement term.  Letter applications for renewal easements shall be submitted within 180 days of the notice of expiration by the State Property Office.
(k)	Easement Modification. – Any expansion of the footprint of an existing structure shall require an easement or modification of any existing easement.  The application for a modification of an easement shall be as provided in subsection (f) of this section. The easement purchase payment shall be based only on the footprint of the expansion after applying the riparian credit.  The minimum easement purchase payment shall be five hundred dollars ($500.00) if any payment is owed after the riparian credit is applied.  Easement holders may voluntarily apply for modification of an easement to correct any material errors or omissions.  No easement purchase payment shall be required for the modification of an existing use that does not expand the footprint of the existing structure.  No refunds shall be provided for any modification that reduces the footprint.
(l)	Easement Transfers. – An easement granted under subsection (b) of this section shall be transferred to a subsequent owner of the adjacent riparian or littoral property upon written notification to the State Property Office.  The notification shall be given within 12 months of the transfer of title to the adjacent riparian or littoral property and shall be accompanied by the instrument of transfer and an easement purchase payment as follows:
(1)	During the first 25 years of the easement term, the easement purchase payment shall be the same as the initial payment; and
(2)	During the second 25 years of the easement term, the easement purchase payment shall be twice the amount of the initial payment.
(m)	Easement Revocation. – Easements issued under subsection (b) of this section may be revoked in accordance with the provisions of G.S. 146-12(a).  Any revocation shall entitle the easement holder to seek administrative review in accordance with the provisions of Article 3 of Chapter 150B of the General Statutes.
(n)	Exemptions. – The following types of structures shall not require an easement under this section:
(1)	Piers, docks, or similar structures constructed appurtenant to residential lots, intended to or permitted for the sole use and benefit of the owners or occupants of the lots for nonincome producing purposes;
(2)	Structures constructed by any public utility that provide or assist in the provision of utility service;
(3)	Structures constructed or owned by the State of North Carolina, or any political subdivision, agency, or department of the State, for the duration that the structures are owned by the entity;
(4)	Structures on a privately owned lake;
(5)	Hydroelectric reservoirs licensed by the Federal Energy Regulatory Commission; or
(6)	Submerged lands or lands covered by navigable waters not owned by or for the benefit of the public that have been created by dredging or excavating lands."
Sec. 3.  Article 1 of Chapter 146 of the General Statutes is amended by adding a new section to read:
"§ 146-14.1.  Natural Resources Easement Fund.
The Natural Resources Easement Fund is established as a nonreverting fund within the Department of Administration.  All easement purchase payment monies collected by the Secretary shall be deposited in the Fund.  The Fund may be used for direct costs of administering the program.  Fifty percent (50%) of the net proceeds in the Fund shall be transferred annually to the Marine Fisheries Commission, and fifty percent (50%) of the net proceeds in the Fund shall be transferred annually to the Wildlife Resources Commission, to be used by both Commissions for the sole purpose of enhancing public trust resources and increasing the public's access to and use of public trust resources, including, but not limited to, meeting the State's cost share obligations for federal Wallop-Breaux Fund projects, enhancing water resources and expanding the number of public boat ramps and other means of public waters access within the counties designated under G.S. 113A-103(2), and other public trust access purposes."
Sec. 4.  G.S. 146-64 is amended by adding a new subdivision to read:
"(10)	For purposes of this Subchapter, 'deep water' means the depth reasonably necessary to provide and allow reasonable access for all vessels traditionally used in the main watercourse area as of the time of the easement application."
Sec. 5.  This act becomes effective October 1, 1995. Nothing in this act shall require the adoption of rules to implement the provisions herein.  The authorization established under this act applies only to the Department of Administration and shall not be used by any other agency to administer or regulate activities affecting the public trust.