A BILL TO BE ENTITLED
AN ACT to make various changes to the private protective services act and the alarm systems licensing act, and to create certain fees.
The General Assembly of North Carolina enacts:

PART I. PRIVATE PROTECTIVE SERVICES ACT CHANGES
SECTION 1.1.  G.S. 74C‑3(a) reads as rewritten:
"(a)	As used in this Chapter, the term "private protective services profession" means and includes the following:
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(5)	Detection of deception examiner. – Any person, firm, association, or corporation which, for a fee or other valuable consideration, uses any device or instrument, regardless of its name or design, for the purpose of the detection of deception or any person who reviews the work product of an examiner including charts, tapes or other methods of record keeping for the purpose of detecting deception or determining accuracy.
(5a)	Electronic countermeasures profession. – Any person, firm, association, or corporation which for a fee or other valuable consideration discovers, locates, or disengages by electronic, electrical, or mechanical means any of the following:
a.	Listening or other monitoring equipment surreptitiously placed to gather information concerning any individual, firm, association, or corporation.
b.	Any device intended to block the transmission of any electronic signal.
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(8)	Private detective or private investigator. – Any person who engages in the profession of or accepts employment to furnish, agrees to make, or makes inquiries or investigations concerning any of the following on a contractual basis:
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(10)	Close personal protection. – Any person, firm, association, or corporation which, for a fee or other valuable consideration, provides or offers to provide security measures to ensure the safety of a business executive, elected or appointed public official, celebrity, or other individuals who may be exposed to elevated personal risk because of the individual's employment, status, wealth, associations, or geographical location.
(11)	Digital forensics examination. – Any individual, firm, association, or corporation which, for a fee or other valuable consideration, provides or offers to provide examination of digitally stored data to recover, image, analyze, or examine the data by using software to determine responsibility or reconstruct usage of the data.
(b)	"Private protective services" shall not include any of the following:
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(17)	A person engaged in network or system vulnerability testing, including network scans and risk assessment and analysis of computers connected to a network, and routine service or repair.
(18)	A person under contract with an occupational licensing board as defined by G.S. 93B‑1 while performing an investigation solely for that board.
(c)	Upon proof that the private investigator has provided services pursuant to former G.S. 74C‑3(a)(8)f. of this section within the five years prior to July 1, 2020, a licensed North Carolina private detective may receive a close personal protection license upon payment of the applicable fee; however, upon the renewal of that license, the private investigator must meet all requirements for a close personal protection license. This provision applies only to private investigators and not trainees."
SECTION 1.2.  G.S. 74C‑4 reads as rewritten:
"§ 74C‑4.  Private Protective Services Board established; members; terms; vacancies; compensation; meetings.
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(d)	Each member of the Board, before assuming the duties of his or her office, shall take an oath for the faithful performance of his or her duties. A Board member may be removed at the pleasure of the authority making the original appointment or by the Board for misconduct, incompetence, or neglect of duty.
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(f)	The Board shall elect a chair, vice‑chair and other officers and committee chairpersons from among its members as the Board deems necessary and desirable at the first meeting after July 1 of each year. The chair and vice‑chair shall be selected by the members of the Board for a term of one year and shall be eligible for reelection. The Board shall meet at the call of the chair or a majority of the members of the Board at such time, date, and location as may be decided upon by a majority of the Board.
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SECTION 1.3.  G.S. 74C‑5 reads as rewritten:
"§ 74C‑5.  Powers of the Board.
In addition to the powers conferred upon the Board elsewhere in this Chapter, the Board shall have the power to do all of the following:
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(13)	Conduct investigations regarding unlicensed activity and, with the concurrence of the Secretary of Public Safety, issue cease and desist letters.
(14)	Acquire, hold, rent, encumber, alienate, and otherwise deal with real property in the same manner as a private person or corporation, subject only to approval of the Governor and the Council of State. Collateral pledged by the Board for an encumbrance is limited to the assets, income, and revenues of the Board.
(15)	Adopt rules establishing standards for the use of any firearm or other weapon approved by the Board.
(16)	Adopt and publish a code of professional conduct for licensees, registrants, certificate holders, or permit holders, the violation of which is grounds to suspend or revoke a license, registration, or permit pursuant to G.S. 74C‑12."
SECTION 1.4.  G.S. 74C‑7 reads as rewritten:
"§ 74C‑7.  Investigative powers of the Secretary of Public Safety.
The Secretary of Public Safety for the State of North Carolina has the power to investigate or cause to be investigated any complaints, allegations, or suspicions of wrongdoing or violations of this Chapter involving unlicensed individuals, licensed individuals, or individuals to be licensed under this Chapter. The Secretary shall retain the authority to enforce the provisions of this Chapter and impose any penalty authorized by G.S. 74C‑12(a) and G.S. 74C‑17 against any person or entity who is under investigation for or charged with a violation of this Chapter even if the person or entity's license or registration has been surrendered or has lapsed. Any investigation conducted pursuant to this section is confidential and is not subject to review under G.S. 132‑1 until the investigation is complete and a report is presented to the Board. However, the report may be released to the licensee after the investigation is complete but before the report is presented to the Board."
SECTION 1.5.  G.S. 74C‑8 reads as rewritten:
"§ 74C‑8.  License requirements.
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(b)	Application. – To apply for a license, an applicant must submit a verified application in writing to the Board that includes all of the following:
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(7)	Accompanying trainee permit applications only, a notarized statement signed by the applicant and his or her employer stating that the trainee applicant will at all times work with and under the direct supervision of a licensed private detective.
(c)	Qualifying Agent. – A business entity, other than a sole proprietorship, that engages in private protective services is subject to all of the requirements listed in this subsection with respect to a qualifying agent. For purposes of this Chapter, a "qualifying agent" is an individual in a management position who is licensed under this Chapter and whose name and address have been registered with the Director. The requirements are:
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(3)	In the event that the qualifying agent upon whom the business entity relies in order to do business ceases to perform his or her duties as qualifying agent, the business entity shall notify the Director within 10 working days. The business entity must obtain a substitute qualifying agent within 90 days after the original qualifying agent ceases to serve as qualifying agent unless the Board, in its discretion, extends the 90‑day period, for good cause, for an additional 30 days upon the filing of a petition by the business entity and upon a hearing by the Board. The Board may require the payment of a late fee for a business entity failing to obtain a substitute qualifying agent pursuant to the requirements of this subdivision.
(d)	Criminal Record Check. – An applicant must meet all of the following requirements and qualifications determined by a background investigation conducted by the Board in accordance with G.S. 74C‑8.1 and upon receipt of an application:
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(2)	That the applicant is of good moral character and temperate habits. The following shall be prima facie evidence that the applicant does not have good moral character or temperate habits: conviction by any local, State, federal, or military court of any crime involving the illegal use, carrying, or possession of a firearm or other deadly weapon; conviction of any crime involving the illegal use, possession, sale, manufacture, distribution, or transportation of a controlled substance, drug, narcotic, or alcoholic beverage; conviction of a crime involving assault or an act of violence; conviction of a crime involving unlawful breaking or entering, burglary, larceny, or any offense involving moral turpitude; or a history of addiction to alcohol or a narcotic drug; provided that, for purposes of this subsection, "conviction" means and includes the entry of a plea of guilty or no contest or a verdict rendered in open court by a judge or jury.
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(f)	Issuance. – Upon a finding that the application is in proper form, the completion of the background investigation, and the completion of an examination required by the Board, the Director shall submit to the Board the application and the Director's recommendations. Upon completion of the background investigation, the Director may issue a temporary license pending approval of the application by the Board at the next regularly scheduled meeting. The Board shall determine whether to approve or deny the application for a license. Upon approval by the Board, a license will be issued to the applicant upon payment by the applicant of the initial license fee and the required contribution to the Private Protective Services Education Fund, and filing of a certificate of liability insurance with the Board. The applicant must pay the initial license fee and make the required contribution to the Fund within 90 days from the date the applicant receives notice of pending licensure approval unless the Board, in its discretion, extends the 90‑day period, for good cause, for an additional 30 days upon the filing of a petition by the applicant and upon a hearing by the Board. The Board may require the payment of a late fee for an applicant failing to pay the initial license fee or failing to make the contribution to the Fund pursuant to the requirements of this subsection."
SECTION 1.6.  G.S. 74C‑9 reads as rewritten:
"§ 74C‑9.  Form of license; term; renewal; posting; branch offices; not assignable; late renewal fee.
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(e)	The Board is authorized to charge reasonable application and license fees as follows:
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(7)	An application fee for a firearm registration permit for all applicants and licensees subject to G.S. 74C‑13 not to exceed fifty dollars ($50.00).
(8)	A new, renewal, replacement, or reissuance fee for a firearm registration permit for all applicants and licensees subject to G.S. 74C‑13 not to exceed thirty dollars ($30.00).
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(16)	A late fee for a business entity subject to G.S. 74C‑8(c)(3) or an applicant for licensure under G.S. 74C‑8(f) not to exceed one hundred dollars ($100.00).
Except as provided in G.S. 74C‑13(k), all fees collected pursuant to this section shall be expended, under the direction of the Board, for the purpose of defraying the expenses of administering this Chapter.
(f)	A license or trainee permit granted under the provisions of this Chapter may be renewed by the Private Protective Services Board upon notification by the licensee or permit holder to the Director of intended renewal, the payment of the proper fee, and evidence of a liability insurance policy as prescribed in G.S. 74C‑10(e).
The renewal shall be finalized before the expiration date of the license. In no event will renewal be granted more than three months after the date of expiration of a license or trainee permit.
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SECTION 1.7.  G.S. 74C‑10 reads as rewritten:
"§ 74C‑10.  Certificate of liability insurance required; form and approval; suspension for noncompliance.
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(e)	No security guard and patrol, armored car, or special limited guard and patrol license shall be issued under this Chapter unless the applicant files with the Board evidence of a liability insurance policy. The policy must provide for the following minimum coverage: fifty thousand dollars ($50,000) because of bodily injury or death of one person as a result of the negligent act or acts of the principal insured or his or her agents operating in the course and scope of his or her employment; subject to said limit for one person, one hundred thousand dollars ($100,000) because of bodily injury or death of two or more persons as the result of the negligent act or acts of the principal insured or his or her agents operating in the course and scope of his or her agency; twenty thousand dollars ($20,000) because of injury to or destruction of property of others as the result of the negligent act or acts of the principal insured or his or her agents operating in the course and scope of his or her agency. If a licensee or a trainee supervised by a licensee, other than a security guard and patrol, armored car, or special limited guard and patrol licensee, carries a firearm while engaged in private protective services activities, the licensee or trainee shall obtain a liability insurance policy with a minimum coverage as specified above. A licensee or trainee is deemed to be "carrying a firearm" for purposes of this section while engaged in private protective services if the licensee or trainee has a firearm on the licensee's or trainee's person or in the automobile the licensee or trainee is using to perform private protective services. A licensee may provide coverage for a trainee under the licensee's supervision; however, failure of the licensee to provide coverage does not exempt the trainee from the requirements of this section.
(e1)	The Board shall approve the form, execution, and terms of the liability insurance policy.
(f)	An insurance carrier has the right to cancel a liability insurance policy upon giving a 30‑day notice to the Board. Provided, however, that the cancellation shall not affect any liability on the policy that accrued prior thereto.
(g)	Persons registered pursuant to G.S. 74C‑11 are not required to obtain a certificate of liability insurance.
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SECTION 1.8.  G.S. 74C‑11 is amended by adding a new subsection to read:
"(g)	Notwithstanding the provisions of this section, during a State of Disaster or State of Emergency declared by the Governor of this State pursuant to Article 1 of Chapter 166A of the General Statutes, a licensee may employ a person properly registered or licensed as an armed security guard in another state provided the licensee, prior to deploying the armed security guard in this State, submits to the Director the name, address, and Social Security number of the armed security guard, the name of the state of current registration or licensing of the armed security guard, proof of completion of the four‑hour training course mandated by G.S. 74C‑13(h)(1)a. and 14B NCAC 16 .0807(c)(1), administered by a North Carolina certified trainer, qualification by a North Carolina Private Protective Services Board certified firearms instructor based on the firearm the armed security guard intends to carry, meeting the qualification requirements approved by the Board and the Secretary of Public Safety for each firearm, and the Director approves the employment of the armed security guard in this State. Qualification shall be valid for a period of 12 months. The duration of the deployment of an armed security guard from another state by a licensee shall not exceed the declared State of Emergency or Disaster."
SECTION 1.9.  G.S. 74C‑12 reads as rewritten:
"§ 74C‑12.  Denial, suspension, or revocation of license, registration, or permit; duty to report criminal arrests.
(a)	The Board may, after compliance with Chapter 150B of the General Statutes, deny, suspend or revoke a license, certification, registration, or permit issued under this Chapter if it is determined that the applicant, licensee, trainee, registrant, or permit holder has done any of the following acts:
(1)	Made any false statement or given any false information in connection with any application for a license, certification, registration, or permit or for the renewal or reinstatement of a license, certification, registration, or permit.
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(6)	Engaged in or permitted any employee to engage in a private protective services profession when not lawfully in possession of a valid license or registration issued under the provisions of this Chapter.
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(9)	Committed an unlawful breaking or entering, assault, battery, or kidnapping or violated any State or federal firearms law.
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(24)	Fraudulently held himself or herself out as employed by or licensed by the Department of Public Safety or any other governmental authority."
SECTION 1.10.  G.S. 74C‑13 reads as rewritten:
"§ 74C‑13.  Armed licensee or registered employee required to have firearm registration permit; firearms training.
(a)	It shall be unlawful for any person performing private protective services duties to carry a firearm in the performance of those duties without first having met the qualifications of this section and having been issued a firearm registration permit by the Board. A licensee or proprietary employer described in G.S. 74C‑3(b)(13) shall register any individual carrying a firearm within 30 days of employment. Before engaging in any private protective services activity, the individual shall receive any required training prescribed by the Board, unless specifically exempted from training by G.S. 74C‑13.1.
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(d2)	A proprietary security organization that employs an armed security guard shall submit to the Board an application for a license on a form provided by the Board for that purpose. A proprietary security organization shall renew its license every two years.
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(g)	The Board may suspend, revoke, or deny a firearm registration permit if the holder or applicant has been convicted of any crime involving moral turpitude or any crime set forth in G.S. 74C‑8(d) or for violation of this section or rules promulgated by the Board to implement this section. The Director may summarily suspend a firearm registration permit pending resolution of charges for any crime involving moral turpitude, any of the offenses set forth in G.S. 74C‑12, or any crime set forth in G.S. 74C‑8(d).
(h)	The Board and the Secretary of Public Safety shall establish a firearms training program for licensees and registered employees to be conducted by agencies and institutions approved by the Board and the Secretary of Public Safety. The Board and the Secretary of Public Safety may approve training programs conducted by a contract security company and the security department of a proprietary security organization, if the contract security company or security department of a proprietary security organization offers the courses listed in subdivision (1) of this subsection and if the instructors of the training program are certified trainers approved by the Board and the Secretary of Public Safety:
(1)	The basic training course approved by the Board and the Secretary of Public Safety shall consist of a minimum of four hours of training which shall include all of the following:
a.	Legal limitations on the use of firearms and on the powers and authority of an armed security guard.
b.	Familiarity with this section.
c.	Range firing and procedure and firearm safety and maintenance.
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(o)	The Board shall not knowingly issue a firearm registration permit to an individual who is prohibited by federal or State law from possessing a firearm."
SECTION 1.11.  Article 1 of Chapter 74C of the General Statutes is amended by adding a new section to read:
"§ 74C‑13.1.  Exemption from firearms training requirements.
(a)	The following persons may be exempt from the firearms training requirements of G.S. 74C‑13(b):
(1)	Those who have successfully completed the North Carolina Basic Law Enforcement Training (BLET) and the first year of probationary employment.
(2)	Persons who have retired either by years of service or by medical disability, or separated in good standing as a sworn law enforcement officer from a federal, state, county, or municipal law enforcement agency that included in their duty the use and qualification of a firearm. Retirement or separation must have occurred within three years of application.
(3)	Military personnel who have been honorably discharged within three years of application and whose military occupational specialty (MOS) included Military Police or Criminal Investigative Division (CID) within three years of application.
(4)	Employees of a nuclear power plant that are required to comply with 10 C.F.R. § 73.55 Appendix B, "Training and Qualification of Security Personnel," as supplemented by the United States Nuclear Regulatory Commission Regulatory Guide 5.75.
(b)	An applicant claiming one of the above exemptions from the 20‑hour course of armed guard instruction must provide the Board the following documentation, as appropriate:
(1)	A copy of a North Carolina BLET training certificate and a letter from the applicant's department verifying that the probationary employment period has been completed.
(2)	Retirement documentation not older than three years verifying sworn status, or the card issued by the North Carolina Criminal Justice Training & Standards Division authorizing concealed carry under the United States Law Enforcement Officers' Safety Act of 2004.
(3)	Documentation from a United States Department of Defense Form DD 214, Form DD 215, or Form NGB 22 noting a Military Police or CID military occupational specialty.
(4)	Documentation of retirement or separation from a federal law enforcement agency with a United States Office of Personnel Management job series of 1811.
(5)	Documentation of current, direct employment with a nuclear power plant located in North Carolina.
(c)	The Board shall deny the exemption if the applicant fails to provide the documentation, as applicable, set forth above.
(d)	When utilizing this exemption, the applicant must qualify within the first three attempts on the required firearm qualification course. If the applicant fails to qualify on both of these required courses, the applicant shall be required to undergo the entire 20‑hour course of instruction.
(e)	When utilizing this exemption, the applicant must complete the legal block of instruction required by G.S. 74C‑13(h)(1) and the Board's administrative rules."
SECTION 1.12.  G.S. 74C‑15(a) reads as rewritten:
"(a)	Upon the issuance of a license or trainee permit, a pocket identification card of design, size, and content approved by the Board shall be issued by the Board without charge to each licensee or trainee. The holder must have this card in his or her possession at all times when he or she is on duty and working within the scope of his or her employment. When a licensee or trainee to whom a card has been issued terminates his or her position as a licensee or trainee, the card must be surrendered to the Director of the Board within 10 working days thereafter."
SECTION 1.13.  G.S. 74C‑17 reads as rewritten:
"§ 74C‑17.  Enforcement.
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(b)	Any person, firm, association, or corporation or their agents and employees violating any of the provisions of this Chapter or knowingly violating any rule promulgated to implement this Chapter shall be guilty of a Class 1 misdemeanor. The Attorney General, or his or her representative, shall have concurrent jurisdiction with the district attorneys of this State to prosecute violations of this Chapter.
(c)	In lieu of revocation or suspension of a license or permit under G.S. 74C‑12, a civil penalty of not more than two thousand dollars ($2,000) per violation may be assessed by the Board against any person or business who violates any provision of this Chapter or any rule of the Board adopted pursuant to this Chapter. In determining the amount of any penalty, the Board shall consider the degree and extent of harm caused by the violation. The clear proceeds of civil penalties provided for in this subsection shall be remitted to the Civil Penalty and Forfeiture Fund in accordance with G.S. 115C‑457.2.
(d)	Proceedings for the assessment of civil penalties under this section shall be governed by Chapter 150B of the General Statutes. If the person assessed a civil penalty fails to pay the penalty to the Board, the Board may institute an action in the superior court of the county in which the person resides or has his or her principal place of business to recover the unpaid amount of the penalty. An action to recover a civil penalty under this section shall not relieve any party from any other penalty prescribed by law.
(e)	The Board shall be entitled to charge costs, including reasonable attorneys' fees, for any proceeding governed by Chapter 150B of the General Statutes or authorized by this section."
SECTION 1.14.  G.S. 74C‑18(b) reads as rewritten:
"(b)	The Director, in his or her discretion and subject to the approval of the Board, may issue a temporary permit to a nonresident who has complied with the provisions of G.S. 74C‑10 and who is validly licensed in another state to engage in a private protective service activity incidental to a specific case originating in another state. A temporary permit may be issued for a period of no more than 30 days and may be renewed. A temporary permit may contain such restrictions which the Board, in its discretion, deems appropriate."
SECTION 1.15.  G.S. 74C‑21(b) reads as rewritten:
"(b)	An off‑duty law enforcement officer may be employed during his or her off‑duty hours by a licensed security guard and patrol company on an employer‑employee basis. An off‑duty law enforcement officer shall not wear his or her police officer's uniform or use the police equipment while working for a security guard and patrol company."
SECTION 1.16.  G.S. 74C‑23 reads as rewritten:
"§ 74C‑23.  Acquisition or change of ownership or control of licensed firm, association, or corporation.
In the event a company, firm, or corporation licensed under this Chapter transfers ownership, control, or a majority of assets to another person, firm, association, or corporation, the person, firm, association, or corporation acquiring control or ownership shall have the following responsibilities:
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(4)	Provide to the Director 10 calendar days prior to the effective date of the transaction a list of any licensee and any registrants affected by the transaction.

(5)	Provide to the Director within 60 calendar days from the effective date of the transaction written confirmation of completion of any changes necessary for the acquiring party to comply with the requirements of this Chapter or any applicable rules adopted by the Board on a form approved by the Director."
SECTION 1.17.  G.S. 14‑269.3 reads as rewritten:
"§ 14‑269.3.  Carrying weapons into assemblies and establishments where alcoholic beverages are sold and consumed.
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(b)	This section shall not apply to any of the following:
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(4)	A person registered as a security guard as defined in G.S. 74C‑3(b)(13) who is hired by the owner, lessee, or person or organization sponsoring the event or a person employed by a business licensed pursuant to G.S. 74C‑2 who is hired by the owner, lessee, or person or organization sponsoring the event.
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PART II. ALARM SYSTEMS LICENSING ACT CHANGES
SECTION 2.  Chapter 74D of the General Statutes reads as rewritten:
"Chapter 74D.
"Electronic Security Systems.
"Article 1.
"Electronic Security Systems Licensing Act.
"§ 74D‑1.  Title.
This act may be cited as the "Electronic Security Systems Licensing Act."
"§ 74D‑2.  License requirements.
(a)	License Required. – No person, firm, association, corporation, or department or division of a firm, association or corporation, shall engage in or hold itself out as engaging in an electronic security systems business without first being licensed in accordance with this Chapter. A department or division of a firm, association, or corporation may be separately licensed under this Chapter if the distinct department or division, as opposed to the firm, association, or corporation as a whole, engages in an electronic security systems business. The department or division shall ensure strict confidentiality of private security information, and the private security information of the department or division must, at a minimum, be physically separated from other premises of the firm, association, or corporation. For purposes of this Chapter an "electronic security systems business" is defined as any person, firm, association or corporation that does any of the following:
(1)	Unless otherwise exempt, sells or attempts to sell an electronic security system by engaging in any personal solicitation to advise, design, or consult on specific types and specific locations of electronic security system devices.
(2)	Unless otherwise exempt, installs, services, monitors, or responds to electrical, wireless or hardwired electronic or mechanical alarm signal devices and security systems, and integrated automation of a residence or business that includes a security element, burglar alarms, monitored access control, or cameras used to detect or observe burglary, breaking or entering, intrusion, shoplifting, pilferage, theft, or other unauthorized or illegal activity.
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(c)	Qualifying Agent. – A business entity that is required to be licensed under this Chapter is subject to all of the requirements listed in this subsection with respect to a qualifying agent. For purposes of this Chapter, a "qualifying agent" is an individual who is a full‑time employee in a management position who is licensed under this Chapter and whose name and address have been registered with the Board. The requirements are:
(1)	The business entity shall employ a designated qualifying agent who meets the requirements for a license issued under and who is, in fact, licensed under the provisions of this Chapter, unless otherwise approved by the Board. Service upon the qualifying agent appointed by the business entity of any process, notice or demand required by or permitted by law to be served upon the business entity by the Electronic Security Systems Licensing Board shall be binding upon the licensed business entity. Nothing herein contained shall limit or affect the right to serve any process, notice or demand required or permitted by law to be served upon a business entity in any other manner or hereafter permitted by law.
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(3)	In the event that the qualifying agent upon whom the business entity relies in order to do business ceases to perform his or her duties as qualifying agent, the business entity shall notify the board in writing by letter or using the Board's online form within 10 working days. The business entity must obtain a substitute qualifying agent within 90 days after the original qualifying agent ceases to serve as qualifying agent. The Director may extend the 90‑day period, for good cause, an additional 30 days upon a written request of an officer of the company.
(4)	The license certificate shall list the name of the qualifying agent. No person shall serve as the qualifying agent for more than one business entity without the prior approval of the Board.
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(6)	The qualifying agent is responsible for maintaining a current address and other contact information with the Board.
(d)	Minimum Qualifications of Qualifying Agent. – An applicant for qualifying agent must meet all of the following requirements and qualifications determined by a background investigation conducted by the Board in accordance with G.S. 74D‑2.1:
(1)	The applicant is at least 18 years of age.
(2)	The applicant is of good moral character and temperate habits. The following shall be prima facie evidence that the applicant does not have good moral character or temperate habits: conviction by any local, State, federal, or military court of any crime involving the illegal use, carrying, or possession of a firearm; conviction of any crime involving the illegal use, possession, sale, manufacture, distribution or transportation of a controlled substance, drug, narcotic, or alcoholic beverages; conviction of a crime involving felonious assault or an act of violence; conviction of a crime involving unlawful breaking or entering, burglary, larceny, or of any offense involving moral turpitude; or a history of addiction to alcohol or a narcotic drug; provided that, for purposes of this subsection, "conviction" means and includes the entry of a plea of guilty, plea of no contest, or a verdict rendered in open court by a judge or jury, including a prayer for judgment continued, adjudication withheld, or equivalent disposition.
(3)	The applicant has the necessary training, qualifications and experience to be licensed.
(4)	The applicant has successfully completed or kept current the Certified Alarm Technician Level II course offered by the Electronic Security System Association.
(5)	Proof of how in‑State activities of the licensee are to be monitored, including a business plan setting forth the type of activities to be performed in this State, such as telephone solicitation, residential and commercial installation or monitoring. The plan shall be updated promptly as activities change.
	
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(g)	An alarm monitoring company located in another state and licensed by that state which demonstrates to the Board's satisfaction that it does not conduct any business through a personal representative present in this State but which solicits and conducts business solely through interstate communication facilities, such as telephone, earth satellite relay stations, the Internet and the United States Postal Service, upon receipt by the Board of a certificate of good standing from the state of licensure, is not required to register employees pursuant to G.S. 74D‑8. Out‑of‑state monitoring companies not licensed in any state must be licensed by the Board and register employees pursuant to G.S. 74D‑8.
"§ 74D‑2.1.  Criminal background checks.
(a)	Authorization. – Upon receipt of an application for a license or registration, the Board shall conduct a background investigation to determine whether the applicant meets the requirements for a license or registration as set out in G.S. 74D‑2(d). The State Bureau of Investigation's Division of Criminal Information Network may provide a criminal record check to the Board for a person who has applied for a new or renewal license or registration through the Board. The Board shall provide to the State Bureau of Investigation, along with the request, the fingerprints of a new applicant, and the State Bureau of Investigation shall provide a criminal record check based upon the applicant's fingerprints. The Board may request a criminal record check from the State Bureau of Investigation for a renewal applicant based upon the applicant's fingerprints in accordance with policy adopted by the Board. The Board shall provide any additional information required by the State Bureau of Investigation and a form signed by the applicant consenting to the check of the criminal record and to the use of the fingerprints and other identifying information required by the State or national repositories. The applicant's fingerprints shall be forwarded to the State Bureau of Investigation for a search of the State's criminal history record file, and the State Bureau of Investigation shall forward a set of the fingerprints to the Federal Bureau of Investigation for a national criminal history check. The State Bureau of Investigation may charge each applicant a fee, to be collected by the Board and transmitted to the State Bureau of Investigation, for conducting the checks of criminal history records authorized by this subsection.
The Board may require a new or renewal applicant to obtain a criminal record report from one or more reporting services designated by the Board to provide criminal record reports. Applicants are required to pay the designated reporting service for the cost of these reports.
(b)	Confidentiality. – Except as necessary to support the denial of an application or a disciplinary matter in a contested case, the Board shall keep all information obtained pursuant to this section confidential in accordance with applicable State law and federal guidelines, and the information shall not be a public record under Chapter 132 of the General Statutes.
"§ 74D‑3.  Exemptions.
(a)	The provisions of this Chapter shall not apply to the following:
(1)	A person, firm, association or corporation that sells or manufactures electronic security systems, unless the person, firm, association or corporation makes personal solicitations at a residence or business to advise, design, or consult on specific types and specific locations of electronic security system devices, installs, services, monitors, or responds to electronic security systems at or from a protected premises or a premises to be protected and thereby obtains knowledge of specific application or location of the electronic security system.
(2)	Installation, servicing or responding to fire alarm systems or any alarm device which is installed in a motor vehicle, aircraft or boat.
(3)	Installation or service of an electronic security system on property owned by or leased to the installer.

(6)	Installation or service of a locking device that records entry and exit data and does not transmit the data in real time to an on‑site or off‑site monitoring location, provided the installer is licensed by the North Carolina Locksmith Licensing Board.
(b)	A person licensed under this Chapter may hire a consultant to troubleshoot a location or installation for a period of time not to exceed 48 hours in a one‑month period if the licensee submits a report to the Board within 30 days from the date of the consultation designating the consultant as a temporary consultant.
"§ 74D‑4.  Electronic Security Systems Licensing Board.
(a)	The Electronic Security Systems Licensing Board is hereby established.
(b)	The Board shall consist of seven members: the Secretary of Public Safety or his or her designee; two persons appointed by the Governor, one of whom shall be licensed under this Chapter and one of whom shall be a public member; two persons appointed by the General Assembly upon the recommendation of the President Pro Tempore of the Senate in accordance with G.S. 120‑121, one of whom shall be licensed under this Chapter and one of whom shall be a public member; and two persons appointed by the General Assembly upon the recommendation of the Speaker of the House of Representatives in accordance with G.S. 120‑121, one of whom shall be licensed under this Chapter and one of whom shall be a public member.
(c)	Each member shall be appointed for a term of three years and shall serve until a successor is installed. With the exception of the Secretary or his or her designee, no member shall serve more than two complete three‑year consecutive terms.
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(f)	The Board shall elect a chair and a vice‑chair from its membership by majority vote at the first meeting of its fiscal year. The vice‑chair shall serve as chair of the screening committee and shall also serve as chair in the chair's absence. At no time shall both the positions of chair and vice‑chair be held by either an industry representative or a nonindustry representative.
(g)	The Board shall meet at the call of the chair or a majority of the members of the Board. The Board shall adopt rules governing the call and conduct of its meetings. A majority of the current Board membership constitutes a quorum.
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"§ 74D‑5.  Powers of the Board.
(a)	In addition to the powers conferred upon the Board elsewhere in this Chapter, the Board shall have the power to do the following:
(1)	Promulgate rules necessary to carry out and administer the provisions of this Chapter including the authority to require the submission of reports and information by licensees under this Chapter.
(2)	Determine minimum qualifications and establish minimum education, experience, and training standards for applicants, licensees and registrants under this Chapter.
(3)	Conduct investigations regarding alleged violations and make evaluations as may be necessary to determine if unlicensed individuals or entities are in violation of this Chapter and licensees and registrants under this Chapter are complying with the provisions of this Chapter. With the concurrence of the Secretary of Public Safety, the Board shall issue, in writing, cease and desist orders for violations of this Chapter.
(4)	Adopt and amend bylaws, consistent with law, for its internal management and control.
(5)	Investigate and approve individual applicants to be licensed or registered according this Chapter.
(6)	Deny, suspend, or revoke any license issued or to be issued under this Chapter to any applicant, licensee, or registrant who fails to satisfy the requirements of this Chapter or the rules established by the Board. The denial, suspension, or revocation of such license or registration shall be in accordance with Chapter 150B of the General Statutes.
(7)	Issue subpoenas to compel the attendance of witnesses and the production of pertinent books, accounts, records, and documents. The district court shall have the power to impose punishment pursuant to G.S. 5A‑21 et seq. for acts occurring in matters pending before the Board which would constitute civil contempt if the acts occurred in an action pending in court.
(8)	Contract for services as necessary to carry out the functions of the Board.
(9)	Acquire, hold, rent, encumber, alienate, and otherwise deal with real property in the same manner as a private person or corporation, subject only to approval of the Governor and the Council of State. Collateral pledged by the Board for an encumbrance is limited to the assets, income, and revenues of the Board.
(b)	The chair of the Board or his or her representative designated to be a hearing officer may conduct any hearing called by the board for the purpose of denial, suspension, or revocation of a license or registration under this Chapter.
(c)	The regulation of electronic security businesses shall be exclusive to the Board; however, any city or county shall be permitted to require an electronic security business operating within its jurisdiction to register and to supply information regarding its license and may adopt an ordinance to require users of electronic security systems to obtain revocable permits when alarm usage involves automatic signal transmission to a law enforcement agency.
"§ 74D‑5.1.  Position of Director created.
The position of Director of the Electronic Security Systems Licensing Board is hereby created within the Department of Public Safety. The Secretary of Public Safety shall appoint a person to fill this full‑time position. The Director's duties shall be to administer the directives contained in this Chapter and the rules adopted by the Board to implement this Chapter and to carry out the administrative duties incident to the functioning of the Board in order to actively police the electronic security systems industry to insure compliance with the law in all aspects. The Director may issue a temporary grant or denial of a request for registration subject to final action by the Board at its next regularly scheduled meeting.
"§ 74D‑5.2.  Investigative powers of the Secretary of Public Safety.
The Secretary of Public Safety shall have the power to investigate or cause to be investigated any complaints, allegations, or suspicions of wrongdoing or violations of this Chapter involving individuals unlicensed, licensed, or to be licensed, under this Chapter. Any investigation conducted pursuant to this section is deemed confidential and is not subject to review under G.S. 132‑1 until the investigation is complete and a report is presented to the Board. However, the report may be released to the licensee after the investigation is complete but before the report is presented to the Board.
"§ 74D‑6.  Denial of registration.
Upon receipt of an application for registration under G.S. 74D‑8, the Board shall determine whether the applicant shall receive the registration applied for. The grounds for denial include the following:
(1)	Commission of some act which, if committed by a registrant or licensee, would be grounds for the suspension or revocation of a registration or license under this Chapter.
(2)	Conviction of a crime involving the illegal use, carrying, or possession of a firearm, felonious assault or an act of violence, felonious sexual offense, felonious larceny, or felonious fraud. For purposes of this subsection, "conviction" means and includes the entry of a plea of guilty, plea of no contest, or a verdict entered in open court by a judge or jury, including a prayer for judgment continued, adjudication withheld, or equivalent disposition.
(3)	Lack of good moral character or temperate habits. The following misdemeanor convictions within 10 years of the date of the application shall be prima facie evidence that the applicant does not have good moral character or temperate habits: conviction by any local, State, federal, or military court of any crime involving the illegal use, carrying, or possession of a firearm; conviction of any crime involving the illegal use, possession, sale, manufacture, distribution, or transportation of a controlled substance, drug, narcotic, or alcoholic beverages; conviction of a crime involving assault or an act of violence; conviction of a crime involving unlawful breaking or entering, burglary or larceny or of any offense involving moral turpitude; conviction of a crime involving a sexual offense; or a history of addiction to alcohol or a narcotic drug; provided that, for purposes of this subsection "conviction" means and includes the entry of a plea of guilty, plea of no contest, or a verdict rendered in open court by a judge or jury, including a prayer for judgment continued, adjudication withheld, or equivalent disposition.
(4)	Previous denial under this Chapter or previous revocation for cause.
(5)	Knowingly making any false statement or misrepresentation in an application made to the Board for a license or registration.
(6)	Registration as a sex offender in this State or any other state.
"§ 74D‑7.  Form of license; term; assignability; renewal; posting; branch offices; fees.
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(d)	Any branch office in this State with an electronic security systems business shall obtain a branch office certificate. A separate certificate stating the location and licensed qualifying agent shall be posted at all times in a conspicuous place in each branch office. Every business covered under the provisions of this Chapter shall file in writing with the Board the addresses of each of its branch offices in this State. All licensees with a branch office shall notify the Board in writing before the establishment, closing, or changing of the location of any branch office in this State. Temporary approval may be granted by the Director, upon application of the qualifying agent, for a period of time not to exceed 45 days after the adjournment of the next regularly scheduled meeting of the Board unless the Board determines that the application should be denied.
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"§ 74D‑8.  Registration of persons employed.
(a)	(1)	A licensee of an electronic security systems business shall register with the Board within 30 days after the employment begins, all of the following employees of the licensee that are within the State, unless in the discretion of the Director, the time period is extended for good cause:
a.	Any employee that has access to confidential information detailing the design, installation, or application of any location specific electronic security system or that has access to any code, number, or program that would allow the system to be modified, altered, or circumvented.
b.	Any employee who installs or services an electronic security system in a commercial business establishment or a personal residence.
Employees engaged only in sales or marketing that does not involve any of the above are not required to be registered.
(1a)	To register an employee, a licensee shall submit to the Board as to the employee: two sets of classifiable fingerprints on standard F.B.I. applicant cards; two recent color photographs of acceptable quality for identification; statements of any criminal records as deemed appropriate by the Board; and the fee authorized under G.S. 74D‑7(e)(4).
(1b)	A licensee may employ an applicant for registration as a probationary employee for 20 consecutive days. Upon completion of the probationary period and the desire of the licensee to hire the registration applicant as a regular employee, the licensee shall register the employee described in subdivision (a)(1) of this section with the Board within 30 days after the probationary employment period ends, unless the Director extends the time period for good cause. Before a probationary employee engages in electronic security systems services, the employee shall complete any training requirements, and the licensee shall conduct a criminal record check on the employee, as the Board deems appropriate. The licensee shall submit a list of the probationary employees to the Director on a monthly basis. The list shall include the name, address, Social Security number, and dates of employment of the employees.
(2)	Except during the probationary period and the time allowed for registration in this section, no electronic security systems business may employ any employee required to be registered by this Chapter unless the employee's registration has been approved by the Board as set forth in this section.
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"§ 74D‑8.1.  Apprenticeship registration permit.
(a)	The Board may issue an apprenticeship registration permit to an applicant who is 16 or 17 years old if the applicant submits at least three letters of recommendation stating that the applicant is of good moral character as provided in G.S. 74D‑2(d)(2). The letters of recommendation shall be from persons who are not related to the individual.
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"§ 74D‑9.  Certificate of liability insurance required; form and approval; suspension for noncompliance.
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(d)	No license shall be issued under this act unless the applicant files with the Board evidence of a policy of liability insurance which policy must provide for the following minimum coverage: two hundred fifty thousand dollars ($250,000) because of bodily injury or death of one person as a result of the negligent act or acts of the principal insured or his or her agents operating in the course and scope of his or her employment; subject to said limit for one person, five hundred thousand dollars ($500,000) because of bodily injury or death of two or more persons as the result of the negligent act or acts of the principal insured or his or her agent operating in the course and scope of his or her agency; one hundred thousand dollars ($100,000) because of injury to or destruction of property of others as the result of the negligent act or acts of the principal insured or his or her agents operating in the course and scope of his or her agency.
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"§ 74D‑10.  Suspension or revocation of licenses and registrations; appeal.
(a)	The Board may, after notice and an opportunity for hearing, suspend or revoke a license or registration issued under this Chapter if it is determined that the licensee or registrant has:
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(3)	Violated any rule adopted by the Board pursuant to the authority contained in this Chapter.
(4)	Been convicted of any felony set forth in G.S. 74D‑6(2) or any crime involving moral turpitude as set forth in G.S. 74D‑6(3).
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(7)	Engaged in or permitted any employee to engage in any electronic security systems business when not lawfully in possession of a valid registration issued under the provisions of this Chapter.
(8)	Committed an unlawful breaking or entering, burglary, larceny, assault, battery, kidnapping, sexual offense, trespassing, or fraud.
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(10)	Failed to maintain the certificate of liability insurance required by this Chapter.
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(15)	Engaged in the electronic security systems profession under a name other than the name under which the license was obtained under the provisions of this Chapter.
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(19)	Engaged in conduct that constitutes dereliction of duty or otherwise deceives, defrauds, or harms the public in the course of professional activities or services, including fraudulently claiming a change in business ownership, fraudulently claiming dissolution of a competing business, fraudulently claiming to be a representative of the consumer's current service provider, misrepresentation of employer, or misrepresenting an upgrade of equipment as a sales tactic.
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"§ 74D‑11.  Enforcement.
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(b)	Any person, firm, association, corporation, or department or division of a firm, association or corporation, or their agents and employees violating any of the provisions of this Chapter or knowingly violating any rule promulgated to implement this Chapter shall be guilty of a Class 1 misdemeanor. The Attorney General, or his or her representative, shall have concurrent jurisdiction with the district attorneys of this State to prosecute violations of this Chapter.
	
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(e)	Proceedings for the assessment of civil penalties shall be governed by Chapter 150B of the General Statutes. If the person assessed a penalty fails to pay the penalty to the Board, the Board may institute an action in the superior court of the county in which the person resides or has his or her principal place of business to recover the unpaid amount of the penalty. An action to recover a civil penalty under this section shall not relieve any party from any other penalty prescribed by law.
(f)	The sale, installation, or service of an electronic security system by an unlicensed or unregistered person shall constitute a threat to the public safety, and any contract for the sale, installation, or service of an electronic security system shall be deemed void and unenforceable.
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"

"§ 74D‑14.  Proof of licensure to maintain or commence action.
An electronic security systems business may not maintain any action in any court of the State for the collection of compensation for performing an act for which a license or registration is required by this Chapter without alleging and proving that the electronic security systems business is appropriately licensed and the employee or agent of the electronic security systems business is appropriately registered upon entering into a contract with the consumer. An electronic security systems installation, maintenance, or monitoring contract entered into with a consumer shall be void if the consumer confirms through records maintained by the Board that the electronic security systems business is not properly licensed or the consumer establishes through records maintained by the Board that the person enticing the consumer to enter into the contract is not properly registered by the Board. The sale, installation, or service of an electronic security system by an unlicensed entity or unregistered employee shall be deemed an unfair and deceptive trade practice and shall be actionable under Chapter 75 of the General Statutes.
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"Article 2.
"Electronic Security Systems Education Fund.
"§ 74D‑30.  Electronic Security Systems Education Fund created; payment to Fund; management; use of funds.
(a)	There is hereby created and established a special fund to be known as the "Electronic Security Systems Education Fund" (hereinafter Fund) which shall be set aside and maintained in the office of the State Treasurer. The Fund shall be used in the manner provided in this Article for the education of licensees and registrants.
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(c)	In addition to the fees provided for elsewhere in this Chapter, the Board shall charge the following fees which shall be deposited into the Fund:
(1)	On July 1, 1985, the Board shall charge every licensee on that date a fee of fifty dollars ($50.00).
(2)	The Board shall charge each new applicant for a license fifty dollars ($50.00), provided that for purposes of this Article a new applicant is hereby defined as an applicant who did not possess a license on July 1, 1985.
(3)	The Board is authorized to charge each licensee an additional amount, not to exceed fifty dollars ($50.00), on July 1 of any year in which the balance of the Fund is less than twenty‑five thousand dollars ($25,000).
(d)	The State Treasurer shall invest and reinvest the moneys in the Fund in a manner provided by law. The Board in its discretion, may use the Fund for any of the following purposes:
(1)	To advance education and research in the electronic security systems field for the benefit of those licensed under the provisions of this Chapter and for the improvement of the industry,
(2)	To underwrite educational seminars, training centers and other educational projects for the use and benefit generally of licensees, and
(3)	To sponsor, contract for and to underwrite any and all additional educational training and research projects of a similar nature having to do with the advancement of the electronic security systems field in North Carolina."

PART III. EFFECTIVE DATE
SECTION 3.  Section 1.1 of this act becomes effective July 1, 2020. The remainder of this act becomes effective July 1, 2019.