2005 North Carolina Code - General Statutes Article 4C - Executive Branch Lobbying.

Article 4C.

Executive Branch Lobbying.

§ 147‑54.31.  (Effective January 1, 2007) Definitions.

The following definitions shall apply in this Article:

(1)       The term "executive action" means the preparation, research, drafting, introduction, consideration, modification, amendment, approval, passage, adoption, tabling, postponement, defeat, or rejection of a rule, regulation, executive order, resolution, or other quasi‑legislative action by the executive branch or by a member or employee of the executive branch acting or purporting to act in an official capacity. This term shall not include any action by an attorney representing a client with respect to the executive action.

(2)       The term "executive branch officers" means the Governor, any member of the Council of State, the heads of those departments listed in G.S. 143B‑6, and members of the Board of Governors of The University of North Carolina.

(3)       The term "executive lobbyist" means any lobbyist for or against executive action.

(4)       The term "expenditure" means any advance, contribution, conveyance, deposit, distribution, payment, gift, retainer, fee, salary, honorarium, reimbursement, loan, pledge, or thing of value greater than ten dollars ($10.00), or a contract, agreement, promise, or other obligation whether or not legally enforceable, that directly or indirectly is made to, at the request of, for the benefit of, or on the behalf of an executive branch officer or that person's immediate family member.

(5)       The term "immediate family member" means spouse, descendant, or ascendant.

(6)       The term "lobbying" means any of the following:

a.         Influencing or attempting to influence executive action through direct communication or activities with an executive branch officer.

b.         Solicitation of others by an executive lobbyist or lobbyist's principal to influence executive action through direct communication or activities with an executive branch officer.

c.         Developing executive goodwill through communications or activities, including the building of relationships, with an executive branch officer or that person's immediate family with the intention of influencing current or future executive action, but does not include communications or activities with executive branch officers or that person's immediate family member in a business, civic, religious, fraternal, or commercial relationship which is not connected to executive action.

(7)       The term "lobbyist" means an individual who meets any of the following criteria:

a.         Is employed and receives compensation, or who contracts for economic consideration, for the purpose of lobbying.

b.         Represents another person and receives compensation for the purpose of lobbying.

            The term "lobbyist" shall not include those individuals who are specifically exempted from this Article by G.S. 147‑54.40. For the purpose of determining whether an individual is an executive lobbyist under this subdivision, reimbursement of actual travel and subsistence expenses shall not be considered compensation; provided, however, that reimbursement in the ordinary course of business of these expenses shall be considered compensation if a significant part of the individual's duties involves executive lobbying.

(8)       The terms "lobbyist's principal" and "principal" mean the person on whose behalf the executive lobbyist lobbies. In the case where a lobbyist is compensated by a law firm, consulting firm, or other entity retained by a person for executive lobbying, the principal is the person whose interests the lobbyist represents in lobbying.

(8a)     The term "news medium" means mainstream media providers whose sole purpose is to report events and that does not involve research or advocacy.

(9)       The term "person" means any individual, firm, partnership, committee, association, corporation, business entity, or any other organization or group of persons which has an independent legal existence. (2005‑456, s. 2.)

 

§ 147‑54.32.  (Effective January 1, 2007) Registration procedure.

(a)       An executive lobbyist shall file a registration statement with the Secretary of State in a manner prescribed by the Secretary before engaging in any lobbying. It shall be unlawful for a person to lobby without registering unless exempted by this Article. A lobbyist shall file a separate registration statement for each principal the lobbyist represents. The registration shall indicate whether it is registration as a legislative lobbyist, executive lobbyist, or both, and a separate registration fee shall be paid for each separate type of registration.

(b)       The form of the registration shall be prescribed by the Secretary of State and shall include the registrant's full name, firm, and complete address and telephone number; the registrant's place of business; the full name and complete address and telephone number of each person by whom the registrant is employed or retained; and a general description of the matters on which the registrant expects to act as an executive lobbyist. The Secretary of State shall make available as soon as practicable the registrations of the lobbyists and lobbyists' principals in an electronic, searchable format.

(c)       Each executive lobbyist shall file an amended registration form with the Secretary of State no later than 10 business days after any change in the information supplied in the executive lobbyist's last registration under subsection (b) of this section. Each supplementary registration shall include a complete statement of the information that has changed.

(d)       Each registration statement of an executive lobbyist required under this Article shall be effective from the date of filing until January 1 of the following year. The executive lobbyist shall file a new registration statement after that date. (2005‑456, s. 2.)

 

§ 147‑54.33.  (Effective January 1, 2007) Registration fee.

A fee of one hundred dollars ($100.00) is due and payable to the Secretary of State by either the lobbyist or the lobbyist's principal at the time of each registration. Fees so collected shall be deposited in the General Fund of the State. The Secretary of State shall allow fees required under this section to be paid electronically, but may not require the fees to be paid electronically. The Secretary of State shall adopt rules providing for the waiver or reduction of the fees required by this section in cases of hardship. The Secretary of State shall also adopt rules providing for the waiver or reduction of the fees required by this section in cases of hardship. (2005‑456, s. 2.)

 

§ 147‑54.34.  (Effective January 1, 2007) Authorization from lobbyist's principal; fee from principal.

(a)       Each executive lobbyist or principal shall file with the Secretary of State within 10 days after the executive lobbyist's registration a written authorization signed by the lobbyist's principal authorizing the lobbyist to represent the principal.

(b)       The form of the authorization shall be prescribed by the Secretary of State and shall include the principal's full name, complete address and telephone number, name and title of the official signing for the principal, and the name of each lobbyist registered to represent the principal. The Secretary of State shall make available as soon as practicable the authorization of the lobbyists' principals in an electronic, searchable format.

(c)       An amended authorization shall be filed with the Secretary of State no later than 10 days after any change in the information supplied on the previous authorization. Each supplementary authorization shall include a complete statement of the information that has changed.

(d)       Except as provided for in subsection (e) of this section, a fee of one hundred dollars ($100.00) is due and payable to the Secretary of State at the time the principal's first authorization statement is filed each calendar year for an executive lobbyist. The fee for the executive lobbyist's authorization shall be seventy‑five dollars ($75.00) if an authorization for the principal to be represented by a legislative lobbyist is filed at the same time. No additional fee is due for additional authorizations filed for executive lobbyists.

(e)       The fee in subsection (d) of this section shall be reduced to a total of twenty‑five dollars ($25.00) if the principal had annual revenues in its most recent fiscal year of three hundred thousand dollars ($300,000) or less and is represented by no more than two different lobbyists. This reduced fee covers authorizations filed for the principal's legislative and executive lobbyists. (2005‑456, s. 2.)

 

§ 147‑54.35.  (Effective January 1, 2007) Contingency lobbying fees and election influence prohibited.

(a)       No person shall act as an executive lobbyist for compensation that is dependent upon the result or outcome of any executive action.

(b)       No executive lobbyist or executive lobbyist's principal shall attempt to influence the action of an executive branch officer by the promise of financial support of the executive branch officer's candidacy or appointment, or by threat of financial support in opposition to the executive branch officer's candidacy in any future election or future reappointment. (2005‑456, s. 2.)

 

§ 147‑54.36.  (Effective January 1, 2007) Exemptions and inclusions for reporting purposes.

(a)       For purposes of G.S. 147‑54.37 and G.S. 147‑54.38, the following expenditures need not be reported:

(1)       Gifts between an immediate family member or person who is the stepchild, sibling, mother‑in‑law, father‑in‑law, son‑in‑law, daughter‑in‑law, or members of the household of the executive branch officer.

(2)       Lawful campaign contributions.

(3)       Commercially available loans made on terms not more favorable than generally available to the public in the normal course of business if not made for the purpose of lobbying.

(4)       Contractual arrangements or business relationships or arrangements made in the normal course of business if not made for the purpose of lobbying.

(5)       The cost of attendance or participation provided by the sponsoring entity of lodging, and of food and beverages consumed, at events sponsored by or in conjunction with a civic, charitable, community, or diplomatic event if the activity or event does not last longer than three hours.

(6)       Academic scholarships made on terms not more favorable than scholarships generally available to the public.

(b)       For purposes of G.S. 147‑54.37 and G.S. 147‑54.38, all expenditures made for the purpose of lobbying need to be reported, including:

(1)       Expenditures benefiting or made on behalf of an executive branch officer or that person's immediate family members, in the regular course of that person's nonexecutive employment.

(2)       Contractual arrangements or direct business relationships between an executive lobbyist or executive lobbyist's principal and an executive branch officer or that person's immediate family member, in effect during the reporting period or the previous 12 months.

(3)       Expenditures reimbursed to an executive lobbyist in the ordinary course of business by the lobbyist's principal or other employer.

(c)       For reporting purposes of G.S. 147‑54.37 and G.S. 147‑54.38, executive lobbying with respect to only the executive actions of the Governor and Lieutenant Governor shall be reported. (2005‑456, s. 2.)

 

§ 147‑54.37.  (Effective January 1, 2007) Statements of executive lobbyist's lobbying expenditures required.

(a)       Each executive lobbyist shall file quarterly expenditure reports under oath with the Secretary of State, in a manner prescribed by the Secretary of State, which may include electronic reports, with respect to each lobbyist's principal within 10 business days after the end of the reporting period. The expenditure report shall include all expenditures during the reporting period. The executive lobbyist shall file an expenditure report whether or not expenditures are made.

(b)       Each expenditure report shall set forth the fair market value, date, a description of the expenditure, name and address of the payee, or beneficiary, and name of any executive branch officer, or that person's immediate family member benefiting by the expenditure. Such expenditures shall be reported using the following categories:

(1)       Transportation and lodging.

(2)       Entertainment, food, and beverages.

(3)       Meetings and events.

(4)       Gifts.

(5)       Other expenditures.

In addition, expenses for the solicitation of others to lobby, whether or not an executive branch officer or that person's immediate family member is affected, shall be reportable if such expenses are incurred in connection, or in concert, with other expenditures reportable under this subsection.

(c)       All reports shall be in the form prescribed by the Secretary of State and shall be open to public inspection upon filing. When more than 15 executive branch officers benefit from an expenditure, no names of individuals need be reported, provided that the report identifies the approximate number of executive branch officers benefiting and, with particularity, the basis for their selection. The approximate number of immediate family members who benefited from the expenditure shall be listed separately.

(d)       When an executive lobbyist fails to file an expenditure report as required in this section, the Secretary of State shall send a certified or registered letter advising the executive lobbyist of the delinquency and the penalties provided by law. Within 20 days of the receipt of the letter, the executive lobbyist shall deliver or post by United States mail to the Secretary of State the required report and an additional late filing fee in an amount equal to the late filing fee under G.S. 163‑278.34(a)(2).

(e)       Filing of the required report and payment of the additional fee within the time extended shall constitute compliance with this section. Failure to file an expense report in one of the manners prescribed herein shall result in revocation of any and all registrations of an executive lobbyist under this Article. No executive lobbyist may register or reregister under this Article until the executive lobbyist has fully complied with this section.

(f)        Appeal of a decision by the Secretary of State under this section shall be in accordance with Article 3 of Chapter 150B of the General Statutes.

(g)       The Secretary of State may adopt rules to facilitate complete and timely disclosure of expenditures, including the format of reports and additional categories of information, and to protect the addresses of payees under protective order issued pursuant to Chapter 50B of the General Statutes or participating in the Address Confidentiality Program pursuant to Chapter 15C of the General Statutes. The Secretary of State shall not impose any penalties or late filing fees upon a principal for subsequent failures to comply with the requirements of this section if the Secretary of State failed to provide to the principal with required notifications of the initial violation. This provision shall not apply to a failure by the principal to file an expenditure report in a timely manner. (2005‑456, s. 2.)

 

§ 147‑54.38.  (Effective January 1, 2007) Statements of lobbyist's principal lobbying expenses required.

(a)       Each executive lobbyist's principal shall file quarterly expenditure reports under oath with the Secretary of State, in a manner prescribed by the Secretary of State, which may include electronic reports, within 10 business days after the end of the reporting period. The expenditure report shall include all expenditures during the reporting period. The lobbyist's principal shall file an expenditure report whether or not expenditures are made during a reporting period.

(b)       Each expenditure report shall set forth the fair market value, date, a description of the expenditure, name and address of the payee, or beneficiary, and name of any executive branch officers, or that person's immediate family member affected by the expenditure. Such expenditures shall be reported using the following categories:

(1)       Transportation and lodging.

(2)       Entertainment, food, and beverages.

(3)       Meetings and events.

(4)       Gifts.

(5)       Other expenditures.

In addition, expenses for the solicitation of others to lobby, whether or not an executive branch officer or that person's immediate family member is affected, shall be reportable if such expenses are incurred in connection, or in concert, with other expenditures reportable under this subsection.

(c)       All reports shall be in the form prescribed by the Secretary of State and open to public inspection upon filing. When more than 15 executive branch officers benefit from an expenditure, no names of individuals need be reported provided that the report identifies the approximate number of executive branch officers benefiting and, with particularity, the basis for their selection. The approximate number of immediate family members who benefited from the expenditure shall be listed separately.

(d)       When a lobbyist's principal fails to file an expenditure report as required in this section, the Secretary of State shall send a certified or registered letter advising the lobbyist's principal of the delinquency and the penalties provided by law. Within 20 days of the receipt of the letter, the lobbyist's principal shall deliver or post by United States mail to the Secretary of State the required report and a late filing fee in an amount equal to the late filing fee under G.S. 163‑278.34(a)(2).

(e)       Filing of the required report and payment of the late fee within the time extended shall constitute compliance with this section. Failure to file an expense report in one of the manners prescribed herein shall result in revocation of any and all registrations of an executive lobbyist's principal under this Article. No executive lobbyist's principal may register or reregister under this Article until the executive lobbyist's principal has fully complied with this section.

(f)        Appeal of a decision by the Secretary of State under this section shall be in accordance with Article 3 of Chapter 150B of the General Statutes.

(g)       The Secretary of State may adopt rules to facilitate complete and timely disclosure of expenditures, including the format of reports and additional categories of information, and to protect the addresses of payees under protective order issued pursuant to Chapter 50B of the General Statutes or participating in the Address Confidentiality Program pursuant to Chapter 15C of the General Statutes. The Secretary of State shall not impose any penalties or late filing fees upon a principal for subsequent failures to comply with the requirements of this section if the Secretary of State failed to provide to the principal with required notifications of the initial violation. This provision shall not apply to a failure by the principal to file an expenditure report in a timely manner. (2005‑456, s. 2.)

 

§ 147‑54.39.  (Effective January 1, 2007) Powers and duties of the Secretary of State.

(a)       The Secretary of State shall perform systematic reviews of reports required to be filed under G.S. 147‑54.37 and G.S. 147‑54.38 on a regular basis to assure complete and timely disclosure of expenditures.

(b)       The Secretary of State may petition the Superior Court of Wake County for the approval to issue subpoenas and subpoenas duces tecum as necessary to conduct investigations of violations of this Article. The court shall authorize subpoenas under this subsection when the court determines they are necessary for the enforcement of this Article. Subpoenas issued pursuant to this subsection shall be enforceable by the court through contempt powers. Venue shall be with the Superior Court of Wake County for any nonresident person, or that person's agent, who makes a reportable expenditure under this Article, and personal jurisdiction may be asserted under G.S. 1‑75.4.

(c)       Complaints of violations of this Article and all other records accumulated in conjunction with the investigation of these complaints shall be considered records of criminal investigations under G.S. 132‑1.4. (2005‑456, s. 2.)

 

§ 147‑54.40.  (Effective January 1, 2007) Persons exempted from provisions of Article.

Except as otherwise provided in this Article, the provisions of this Article shall not be construed to apply to any of the following:

(1)       An individual solely engaged in expressing a personal opinion on an executive action and not acting as an executive lobbyist.

(2)       A person appearing before a committee, commission, board, council, or other collective body whose membership includes one or more executive branch officers at the invitation or request of the collective body or a member thereof and who engages in no further activities as an executive lobbyist in connection with that or any other executive action.

(3)       A duly elected or appointed official or employee of the State, the United States, a county, municipality, school district, or other governmental agency, when appearing solely in connection with matters pertaining to the office and its public duties.

(4)       A person performing professional services in advising and rendering opinions to clients, or to executive branch officers on behalf of clients, as to the construction and effect of proposed or pending executive action where the professional services are not otherwise connected with executive action.

(5)       A person who owns, publishes, or is employed by any news medium while engaged in the acquisition or dissemination of news on behalf of the news medium.

(6)       A person responding to inquiries from an executive branch officer and who engages in no further activities as an executive lobbyist in connection with that or any other executive action.

(7)       A person appearing before an executive branch agency or department on behalf of another person, on an individual application for a license or permit, or a disciplinary action on a license or permit.

(8)       A person appearing before an executive branch officer on behalf of another person with respect to a proposed sale or lease of real property, goods or services to the State, or construction of property by the State.

(9)       An employee who represents the employer's interests in executive action for no more than nine hours during a six‑month reporting period, provided that neither the employee nor the employer make any expenditure as defined in G.S. 147‑54.31.

(10)     A person appearing before an executive branch agency or department or an executive branch officer on behalf of another person or entity in connection with an application for a grant, loan, determination or eligibility, or certification. (2005‑456, s. 2.)

 

§ 147‑54.41.  (Effective January 1, 2007) Expenditures made by persons exempted or not covered by this Article.

(a)       If an executive branch officer accepts an expenditure made for the purpose of lobbying valued over two hundred dollars ($200.00) from a person or group of persons acting together, exempted or not otherwise covered by this Article, the person, or group of persons, making the expenditure shall report the date, a description of the expenditure, the name and address of the person, or group of persons, making the expenditure, the name of the executive branch officer accepting the expenditure, and the estimated fair market value of the expenditure.

(b)       If the person making the expenditure in subsection (a) of this section is outside North Carolina, and the executive branch officer accepting the expenditure is also outside North Carolina at the time the person accepts the expenditure, then the person accepting the expenditure shall be responsible for filing the report using available information.

(c)       If an executive branch officer accepts a scholarship valued over two hundred dollars ($200.00) from a person, or group of persons, acting together, exempted or not otherwise covered by this Article, the person, or group of persons, granting the scholarship shall report the date of the scholarship, a description of the event involved, the name and address of the person, or group of persons, granting the scholarship, the name of the executive branch officer accepting the scholarship, and the estimated fair market value.

(d)       If the person granting the scholarship in subsection (c) of this section is outside North Carolina, the covered person or legislative employee accepting the scholarship shall be responsible for filing the report.

(e)       This section shall not apply to any of the following:

(1)       Lawful campaign contributions.

(2)       Any gift from a family member to a covered person or legislative employee.

(3)       Gifts associated primarily with the executive branch officer's or that person's immediate family member's nonexecutive employment.

(4)       Gifts, other than food, beverages, travel, and lodging, received by an executive branch officer which are received from a person who is a citizen of a country other than the United States or a state other than North Carolina and given during a ceremonial presentation or as a custom.

(5)       A thing of value that is paid for by the State.

(6)       Gifts accepted by an executive branch officer in the name of or on behalf of the State.

(f)        Reports required by this section shall be filed within 10 business days after the end of the quarter in which the expenditure was made, with the Secretary of State in a manner prescribed by the Secretary of State, which may include electronic reports. (2005‑456, s. 2.)

 

§ 147‑54.42.  (Effective January 1, 2007) Punishment for violation.

(a)       Whoever willfully violates any provision of this Article shall be guilty of a Class 1 misdemeanor. In addition, no executive lobbyist who is convicted of a violation of the provisions of this Article shall in any way act as an executive or legislative lobbyist for a period of two years following conviction.

(b)       In addition to the criminal penalties set forth in this section, the Secretary of State may levy civil fines for willful false or incomplete reporting up to five thousand dollars ($5,000) per violation. (2005‑456, s. 2.)

 

§ 147‑54.43.  (Effective January 1, 2007) Enforcement of Article by Attorney General.

The Secretary of State shall report apparent violations of this Article to the Attorney General. The Attorney General shall, upon complaint, make an appropriate investigation thereof, and the Attorney General shall forward a copy of the investigation to the district attorney of the prosecutorial district as defined in G.S. 7A‑60, of which Wake County is a part, who shall prosecute any person who violates any provisions of this Article. (2005‑456, s. 2.)

 

§ 147‑54.44.  (Effective January 1, 2007) Rules and forms.

(a)       The Secretary of State shall adopt any rules, orders, forms, and definitions as are necessary to carry out the provisions of this Article. The Secretary of State may appoint a council to advise the Secretary in adopting rules under this section.

(b)       The Secretary of State shall adopt rules to protect from disclosure all confidential information under Chapter 132 related to economic development initiatives or to industrial or business recruitment activities. The information shall remain confidential until the State, a unit of local government or the business has announced a commitment by the business to expand or locate a specific project in this State or a final decision not to do so and the business has communicated that commitment or decision to the State or local government agency involved with the project. (2005‑456, s. 2.)