GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 1997

H	7 

HOUSE BILL 1304
Committee Substitute Favorable 6/17/98
Committee Substitute #2 Favorable 7/2/98
Committee Substitute #3 Favorable 7/7/98
Fifth Edition Engrossed 7/8/98
Senate Transportation Committee Substitute Adopted 7/27/98
Seventh Edition Engrossed 8/4/98

Short Title:  BOT Reform.	(Public)

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Sponsors:

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Referred to:  

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May 18, 1998

A BILL TO BE ENTITLED
AN ACT TO REFORM THE BOARD OF TRANSPORTATION BY ALTERING ITS GOVERNANCE STRUCTURE, AUTHORIZING A NEW ETHICS POLICY, REQUIRING DISCLOSURE OF POLITICAL CONTRIBUTIONS BY BOARD MEMBERS, INCREASING PUBLIC PARTICIPATION IN ITS DECISIONS, AND CHANGING THE PENALTIES FOR MISUSE OF A DOT BOARD POSITION.
The General Assembly of North Carolina enacts:
Section 1.  Part 2 of Article 8 of Chapter 143B of the General Statutes reads as rewritten:
"Part 2.  Board of  
Transportation.
"§ 143B-350.  Board of Transportation – organization; powers and duties, etc.
					(a) Board of Transportation. – There is hereby created a Board of Transportation.  The Board shall carry out its duties consistent with the needs of the State as a whole. The diversity and size of the State require that regional differences be considered by Board members as they develop transportation policy and projects for the benefit of the citizens of the State.
(b)	Membership of the Board. –
(1)	Number, appointment. – The Board of Transportation shall have 19 voting members.  Fourteen of the members shall be division members appointed by the Governor.  Five shall be at-large members appointed by the Governor.  The Secretary of Transportation shall serve as an ex officio nonvoting member of the Board. No more than two members of the Board may reside in the same highway division.
(2)	Division members. – One member shall be appointed from and a resident of each of the 14 highway divisions. The Governor, in selecting division members, shall consider for appointment persons suggested by the Transportation Advisory Committees located within each division. Division members shall direct their primary effort to developing transportation policy and addressing transportation problems in the region they represent.  Division members shall regularly consult with and consider the views of local government units and transportation advisory committees in the region they represent.
(3)	At-large members. – Five members shall be appointed by the Governor from the State at large. At-large members appointed pursuant to this subdivision shall develop transportation policy and address transportation problems with a statewide perspective.  At-large members appointed under this subdivision shall possess the following qualifications:
a.	One at-large member shall be a person with expertise in environmental issues affecting the State;
b.	One at-large member shall be a person familiar with the State Ports and aviation;
c.	One at-large member shall be a person residing in an urban area of the State with broad knowledge of and experience in transportation issues affecting urban areas;
d.	One at-large member shall be a person residing in a rural area of the State with broad knowledge of and experience in transportation issues affecting rural areas;
e.	One at-large member shall be a person with expertise in mass transit.
(c)	Staggered Terms. – The terms of all Board members serving on the Board prior to January 15, 1999, shall expire on January 14, 1999. A new board of 19 members shall be appointed with terms beginning on January 15, 1999.  The Board shall serve the following terms: division members representing divisions 1, 3, 5, 7, 9, 11, and 13 and the three at-large members filling the positions designated in subdivisions (b)(3)a., b., and e., of this section shall serve two-year terms beginning on January 15, 1999, and four-year terms thereafter; and division members representing divisions 2, 4, 6, 8, 10, 12, and 14 and the two at-large members filling the positions designated in subdivisions (b)(3)c. and d. of this section shall serve four-year terms beginning January 15, 1999, and four-year terms thereafter.
(d)	Holdover Terms; Vacancies; Removal. – Members shall continue to serve until their successors are appointed.  The Governor may appoint a member to serve out the unexpired term of any Board member.  The Governor may remove any member of the Board for any cause the Governor finds sufficient.  The Governor shall remove any member of the Board upon conviction of a felony, conviction of any other offense involving a violation of the Board member's official duties, or a violation of the provisions of subsections (i), (j), and (k) of this section or any other code of ethics applicable to members of the Board as determined by the Governor or the Governor's designee.
(e)	Organization and Meetings at the Board. – Within 60 days after January 15, 1999, and thereafter within 60 days following the beginning of the regular term of the Governor, the Governor or his designee shall call the Board into session.  The Board shall then select a chair and vice-chair from among its membership for two-year terms. The Board may select a chair or vice-chair for one additional two-year term. The Board of Transportation shall meet once in each 60 days at such regular meeting times as the Board may by rule provide and at any place in the State as the Board may provide. The Board may hold special meetings at any time at the call of the chairman or any three members. The Board shall have the power to adopt and enforce rules and regulations for the government of its business and proceedings. The Board shall keep minutes of its meetings, which shall at all times be open to public inspection. The majority of the Board shall constitute a quorum for the transaction of business. Board members shall receive per diem and necessary travel and subsistence expenses in accordance with G.S. 138-5 and G.S. 138-6, as appropriate.
(f)	Duties of the Board. – The Board of Transportation shall have duties and powers:
(1)	To formulate policies and priorities for all modes of transportation under the Department of Transportation;
(2)	To advise the Secretary on matters to achieve the maximum public benefit in the performance of the functions assigned to the Department;
(3)	To ascertain the transportation needs and the alternative means to provide for these needs through an integrated system of transportation taking into consideration the social, economic and environmental impacts of the various alternatives;
(4)	To approve a schedule of all major transportation improvement projects and their anticipated cost for a period of seven years into the future. This schedule is designated the Transportation Improvement Program; it must be published and copies must be available for distribution. The document that contains the Transportation Improvement Program, or a separate document that is published at the same time as the Transportation Improvement Program, must include the anticipated funding sources for the improvement projects included in the Program, a list of any changes made from the previous year's Program, and the reasons for the changes;
(5)	To consider and advise the Secretary of Transportation upon any other transportation matter that the Secretary may refer to it;
(6)	To assist the Secretary of Transportation in the performance of his duties in the development of programs and approve priorities for programs within the Department;
(7)	To allocate all highway construction and maintenance funds appropriated by the General Assembly as well as federal-aid funds which may be available;
(8)	To approve all highway construction programs;
(9)	To approve all highway construction projects and construction plans for the construction of projects;
(10)	To review all statewide maintenance functions;
(11)	To award all highway construction contracts;
(12)	To authorize the acquisition of rights-of-way for highway improvement projects, including the authorization for acquisition of property by eminent domain;
(13)	To promulgate rules, regulations, and ordinances concerning all transportation functions assigned to the Department.
(f1)	The ability of a municipality to pay in part or whole for any transportation improvement project shall not be a factor considered by the Board of Transportation in its development and approval of a schedule of major State highway system improvement projects to be undertaken by the Department under G.S. 143B-350(f)(4).
(g)	Delegation of Board Duties. – The Board of Transportation may, in its discretion, delegate to the Secretary of Transportation the authority:
(1)	To approve all highway construction projects and construction plans for the construction of projects;
(2)	To award all highway construction contracts;
(3)	To promulgate rules, regulations, and ordinances concerning all transportation functions assigned to the Department.
The Secretary may, in turn, subdelegate these duties and powers.
(h)	Consultation of Board Members. – Each member of the Board of Transportation who is appointed to represent a transportation engineering division or who resides in a division shall be consulted before the Board makes a decision affecting that division.
(i)	Disclosure of Contributions. – A person appointed to the Board of Transportation shall disclose at the time the appointment of the person is officially made public any contributions the person or the person's immediate family made to the political campaign of the appointing Governor in the two years preceding the date of appointment. The term ‘immediate family', as used in this subsection, means a person's spouse, children, parents, brothers, and sisters.   Disclosure forms shall be filed with the Governor or the Governor's designee and in a manner as prescribed by the Governor. Disclosure forms shall not be a public record under the provisions of Chapter 132 of the General Statutes until such time as the appointment of the person filing the statement is officially made public.
(j)	Disclosure of Campaign Fund-raising. – A person appointed to the Board of Transportation shall disclose at the time the appointment of the person is officially made public any contributions the person personally acquired in the two years prior to appointment for: any political campaign for a statewide or legislative elected office in North Carolina; any political party executive committee or political committee acting on behalf of a candidate for statewide or legislative office.  Disclosure forms shall be filed with the Governor or the Governor's designee and in a manner as prescribed by the Governor.  Disclosure forms shall not be a public record under the provisions of Chapter 132 of the General Statutes until such time as the appointment of the person filing the statement is officially made public.
(k)	Ethics Policy. – The Board shall adopt a code of ethics applicable to members of the Board.  Any code of ethics adopted by the Board shall be supplemental to any other code of ethics that may be applicable to members of the Board.  A code of ethics adopted pursuant to this subsection shall:
(1)	Include a prohibition against a member taking action as a Board member when a conflict of interest, or the appearance of a conflict of interest, exists.  The ethics policy adopted pursuant to this section shall specify that a conflict of interest exists when the use of the Board member's position, or any official action taken by the Board member, would result in financial benefit, direct or indirect, to the Board member, a member of the Board member's immediate family, or an individual with whom, or business with which, the Board member is associated.  The ethics policy adopted pursuant to this section shall specify that an appearance of a conflict of interest exists when a reasonable person would conclude from the circumstances that the Board member's ability to protect the public interest, or perform public duties, would be compromised by personal interest, even in the absence of an actual conflict of interest.  The performance of usual and customary duties associated with the public position or the advancement of public policy goals or constituent services, without compensation, shall not constitute the use of the Board member's position for financial benefit. The conflict of interest provision of the ethics policy adopted pursuant to this section shall not apply to financial or other benefits derived by a Board member that the Board member would enjoy to an extent no greater than that which other citizens of the State would or could enjoy.
(2)	Require the filing of a statement of economic interest.  The statement of economic interest shall include a listing of the nominee's legal, equitable, or beneficial interest in real estate holdings in the State, and a statement of the nominee's financial interest in any business related to the State's transportation system. The statement of economic interest shall be filed with the Governor, or the Governor's designee, and in a manner as prescribed by the Governor.
(3)	Require the filing of a statement of association. The statement of association shall include a statement of the nominee's membership or other affiliation with, including offices held, in societies, organizations, or advocacy groups pertaining the State's transportation system.  The statement of association shall be filed with the Governor, or the Governor's designee, and in a manner as prescribed by the Governor.
Any statement of economic interest or statement of association filed with the Governor or the Governor's designee shall not be a public record under the provisions of Chapter 132 of the General Statutes until such time as the appointment of the person filing the statement is officially made public.
(k1)	Additional Requirements for Disclosure Statements. – All disclosure statements required under subsections (i), (j), and (k) of this section must be sworn written statements, and all such statements must be completed and filed prior to the beginning of any person's term on the Board.
(l)	Ethics and Board Duties Education. – The Board shall institute and conduct annually an education program on ethics and on the duties and responsibilities of Board members.  The training session shall be comprehensive in nature and shall include input from the Institute of Government, the Board of Ethics, the Attorney General's Office, the University of North Carolina Highway Safety Research Center, and senior career employees of the various divisions of the Department. This program shall include an initial orientation for new members of the Board and continuing education programs for Board members at least once each year."
Section 2.  Article 1 of Chapter 136 is amended by adding a new section to read:
"§ 136-11.1.  Local consultation on transportation projects.
Prior to any action of the Board on a transportation project, the Department shall inform all municipalities and counties affected by a planned transportation project and request each affected municipality or county to submit within 45 days a written resolution expressing their views on the project.  A municipality or county may designate a Transportation Advisory Committee to submit its response to the Department's request for a resolution.  Upon receipt of a written resolution from all affected municipalities and counties or their designees, or the expiration of the 45-day period, whichever occurs first, the Board may take action.  The Department and the Board shall consider, but shall not be bound by, the views of the affected municipalities and counties on each transportation project.  The failure of a county or municipality to express its views within the time provided shall not prevent the Department or the Board from taking action. The Department shall not be required to send notice under this section if it has already received a written resolution from the affected county or municipality on the planned transportation project.  ‘Action of the Board', as used in this section, includes approval by the Board of: the Transportation Improvement Program and amendments to the Transportation Improvement Program, the Secondary Roads Paving Program and amendments to the Secondary Roads Paving Program, access and public service road projects, contingency projects, small urban projects, and spot safety projects.  The 45-day notification provision may be waived upon a finding by the Secretary of Transportation that emergency action is required. Such findings must be reported to the Joint Legislative Transportation Oversight Committee."
Section 2.1. Chapter 136 is amended by adding a new section to read:
"§ 136-13.3. Specified employees and others to disclose real estate holdings.
(a)	Disclosure. – The Secretary of Transportation shall require the following persons to disclose in a sworn written statement all legal, equitable, and beneficial interests in real estate of that person or the person's immediate family:
(1)	Any employee of the Department who holds a supervisory position that involves right-of-way or appraisal; or
(2)	Any other person who provides right-of-way or appraisal services to the Department on a contractual basis.
(b)	Affected Persons. – The Secretary shall establish a list of the employees and others who are subject to the requirements of subsection (a) of this section, and update it by February 1 of each year.
(c)	Failure to Comply With Disclosure Requirement. – A false or incomplete statement filed pursuant to this section, or failure to file a statement pursuant to this section, shall subject an employee to disciplinary action for cause pursuant to Chapter 126 of the General Statutes.
(d)	Records Open. – The list of affected persons and any disclosure statements filed with the Board under this section shall be public records in accordance with Chapter 132 of the General Statutes."
Section 3. (a)	G.S. 136-14 reads as rewritten:
"§ 136-14.  Members not eligible for other employment with Department; no sales to Department by employees; members not to sell or trade property with Department; profiting from official position; misuse of confidential information by Board members.
(a)	No Board member shall be eligible to any other employment in connection with the Department.
(b)	No Board member or any salaried employee of the Department shall furnish or sell any supplies or materials, directly or indirectly, to the Department.
(c)	No Board member shall, directly or indirectly, engage in any transaction involving the sale of or trading of real or personal property with the Department.
(d)	No Board member shall profit in any manner by reason of the Board member's official action or official position, except to receive salary, fees and allowances as by law provided.
(e)	No Board member shall take any official action or use the Board member's official position which profits in any manner the Board member's immediate family, a business with which the Board member or the Board member's immediate family has a business association, or a client of the Board member or the Board member's immediate family with whom the Board member, or the Board member's immediate family, has an existing business relationship for matters before the Board.
(f)	No Board member, in contemplation of official action by the Board member, by the Board, or in reliance on information which was made known to the Board member in the Board member's official capacity and which has not been made public, shall commit any of the following acts:
(1)	Acquire a pecuniary interest in any property, transaction, or enterprise or gain any pecuniary benefit which may be affected by such information or official action; or
(2)	Intentionally aid another to do any of the above acts.
(g)	As used in this section, the following terms mean:
(1)	‘Board'. – The Board of Transportation.
(2)	‘Board member'. – A member of the Board of Transportation.
(3)	‘Business association'. – A director, employee, officer, or partner of a business entity, or owner of more than ten percent (10%) interest in any business entity.
(4)	‘Department'. – The Department of Transportation.
(5)	‘Immediate family'. – Spouse, children, parents, brothers, and sisters.
(6)	‘Official action'. – Actions taken while a Board member related to or in connection with the person's duties as a Board member including, but not limited to, voting on matters before the Board, proposing or objecting to proposals for transportation actions by the Department or the Board, discussing transportation matters with other Board members or Department staff or employees in an effort to further the matter after the conflict of interest has been discovered, or taking actions in the course and scope of the position as a Board member and actions leading to or resulting in profit.
(7)	‘Profit'. – Receive monetary or economic gain or benefit, including an increase in value whether or not recognized by sale or trade.
(h)	Violation of this section shall be a Class H felony which may include a fine of not more than twenty thousand dollars ($20,000), or three times the value of the transaction, whichever amount is greater."
(b) Chapter 136 of the General Statutes is amended by adding a new section to read:
"§ 136-14.3. Felony for legislator to receive or solicit campaign contribution in return for influencing action of Department of Transportation.
It is a Class F felony for any member of the General Assembly to receive or solicit any campaign contribution in return for any promise to influence any action of the Department of Transportation or the Board of Transportation or for any person to falsely accuse another of violating the provisions of this statute."
Section 4.  The Secretary of the Department of Transportation shall study realignment and reorganization of the 14 Transportation Divisions of the State to more closely match the urban and rural regions that have developed in the State over the past 40 years and to improve the efficiency of the operations of the Department.  The Secretary shall give primary consideration to the boundaries of the metropolitan planning regions of the State as he considers realignment of the Transportation Divisions.  The Secretary shall report his findings to the General Assembly on or before December 31, 1998.
Section 5.  The Department of Transportation shall develop a plan to establish Rural Transportation Planning Organizations (RPOs) as a counterpart to the existing Metropolitan Planning Organizations (MPOs).  The Department shall report its plan to establish these organizations to the General Assembly by December 31, 1998.
Section 6.  The Department of Transportation shall study the backlog of maintenance needs for the State's highways and suggest methods for addressing this issue, including sources of funds.  The Department shall report its findings and recommendations to the General Assembly by December 31, 1998.
Section 7.  Section 1 of this act becomes effective January 15, 1999.  Members of the Board of Transportation serving on January 14, 1999, shall continue to serve until the date their successors are appointed.  Section 2 of this act becomes effective December 31, 1998, and applies to actions taken by the Board of Transportation on or after April 1, 1999.  Section 3 of this act becomes effective December 1, 1998, and applies to offenses committed on or after that date.  The remainder of this act is effective when it becomes law.