A bill to shift wide-ranging regulatory powers from North Carolina’s governor and other executive branch leaders to state lawmakers is advancing in the legislature, with a final vote expected in the coming days.
House Bill 402 seeks to block executive-branch agencies from passing almost any new rules or regulations unless they first receive legislative approval. It comes several months after the Republican-led legislature passed another law weakening Democratic Gov. Josh Stein’s influence over elections, law enforcement, energy policy and more.
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Opponents say it’ll grind regulation to a halt, leading to a rise in pollution and other corporate abuses. Supporters say it’s necessary to stop unelected bureaucrats from pushing overly strict rules that make things cost more and take longer.
“Regulation is the largest cost-driver to the citizens of the state, next to inflation,” bill sponsor Rep. Allen Chesser, R-Nash, said in the House debate over the bill.
Stein wouldn’t be the only official affected by this new bill — the state’s executive branch is run by 10 elected leaders called the Council of State, currently made up of five Republicans and five Democrats — but the governor’s office is in charge of agencies with a notable regulatory footprint over the environment, transportation and more.
The bill to crack down on regulations is part of a national effort by pro-business political groups to pass versions of what they call the “REINS Act,” named for its intent to rein in government oversight. Similar bills have been filed in many individual states as well as in the U.S. Congress. It has already become law in Utah, Florida and a few other states.
One of the main forces behind the bill is Americans for Prosperity, a pro-business group tied to libertarian billionaire Charles Koch. The group’s North Carolina director, Tyler Voigt, said state agencies will still be allowed to propose rules and regulations even if the REINS Act becomes law in North Carolina. They’ll just have to be able to defend those proposals well enough to win support for them at the legislature.
“This is the point of government, to have your elected officials make decisions,” Voigt said in an interview.
Sen. Steve Jarvis, R-Davidson, has defended the bill against critics who say it’s unconstitutional and would stop the government from helping protect public health and safety.
“This ensures fiscal responsibility and general legislative control, while respecting the separation of powers and federal obligations,” he said during the Senate’s debate over the bill last week. “I urge support of House Bill 402 to balance accountability with efficiency in governance.”
Critics aren’t so certain that the state’s deeply divided legislature will be able to agree on much of anything. They say the bill sets an impossibly high bar by requiring legislative approval for any rule estimated to have a combined cost on businesses of more than $20 million spread over five years. Less costly bills would similarly need to win at least two-thirds approval — or potentially unanimous approval, depending on the exact cost estimate — from relevant state commissions.
It also wouldn’t allow for a cost-benefit analysis, instead using costs alone to determine whether a rule needs approval and by whom. Critics say that will allow special interests to kill proposals that would lead to billions of dollars worth of benefits for public health and safety statewide, just to save businesses a much smaller amount of money.
“This bill is unfair, unreasonable and unworkable,” said Sen. Jay Chaudhuri, D-Wake.
Environmental rules in crosshairs
Sen. Julie Mayfield, D-Buncombe, referenced North Carolina’s years-long struggles to stop pollution from so-called “forever chemicals” such as FPAS, which are found in many sources of drinking water and have been linked to cancer and other health problems.
Even small steps to address PFAS pollution, Mayfield said, would become impossible in the future under the REINS Act due to the deep-pocketed chemical industry’s political power.
She noted that the state’s GOP-majority Environmental Management Commission is already holding up proposed rules to limit PFAS levels in state waterways. WRAL previously reported that’s due to political pressure from the Chamber of Commerce business lobbying group.
But for conservatives energized by Republican President Donald Trump’s efforts to slash government spending and regulations — the federal Environmental Protection Agency has eliminated PFAS rules and proposed allowing more mercury pollution since Trump took office — the moment seems right to push for state-level efforts to limit regulation, too.
Voigt pointed to a poll his group conducted of North Carolina voters this spring that found public opinion was split on Trump, but heavily in favor of the REINS Act.
That level of bipartisanship hasn’t been reflected in the state legislature, however, where the bill passed purely along party lines in the Senate and almost entirely along party lines in the House.
Arguments for, against
During recent legislative debates, several Democratic critics have questioned why the part-time state legislature would think it’s better suited to analyze highly technical scientific arguments and data than the experts who have been hired to do that job within state government.
One of the bill’s co-sponsors, Rep. Mike Schietzelt, R-Wake, countered that the bill isn’t about ignoring the experts, but instead leaving the final decision up to politicians who are accountable to voters. “We are not a technocracy, we are a democracy, and it’s our role to step into that,” Schietzelt said.
He compared it to a court case, in which experts from both sides present their arguments and then a group of non-experts — the jury — decides who made the better argument. He imagines the legislature acting as jurors in future battles between business interests and government regulators.
Rep. Abe Jones, D-Wake, is a former judge. He challenged Schietzelt’s analogy, pointing out that the state already has a court system specifically for businesses to challenge state regulations, through the Office of Administrative Hearings. Jones used to work as one of those OAH judges, and he questioned if the legislature could reasonably be expected to handle the thousands of pages of reading and hours upon hours of highly technical arguments.
“Sometimes the trials went on for as much as two weeks,” Jones said. “The question I have: Is this body ready for that? … And is that going to be better for the public than what we have now?”
Jurors also can’t take payments from the people whose cases they’re hearing. The same is not true of politicians, who frequently receive hefty campaign donations from business interests, or environmental groups, or others who would have a stake in any potential vote on regulations.
Other critics point to the gerrymandering in North Carolina that has given Republicans a disproportionate advantage in the legislature, as well as ensuring there are almost no competitive districts. Almost all 170 members of the legislature face their most serious political challenges in party primaries, which disfavors moderates in favor of more far-right or far-left politicians.
Opponents say it makes more sense to leave regulation in the hands of agencies led by the governor and other officials who are elected statewide, and are therefore accountable to all voters.
“Electoral outcomes are rigged long before the voters even cast their first ballot,” Sen. Terence Everitt, D-Wake, said during the Senate’s debate over the bill last week. “We can disagree about whether that's right or wrong. But no one in this room can honestly say that [the legislature] is reflective of the will of the people of this state.”
What happens next
The bill isn’t on Stein’s desk yet, despite passing both chambers of the legislature.
That’s because the House and Senate passed different versions of the bill. The Senate passed its version on Tuesday. It’s now back in the House, which could decide this coming week whether to approve the Senate’s version of the bill or shoot it down and enter negotiations on a compromise.
Chesser, the bill’s sponsor, said in an interview that he and other lawmakers are working to determine what the final version of the bill should look like.
A spokeswoman for Stein declined to comment on whether he’d veto the bill, since it hasn’t yet been finalized in the legislature. The two different versions each passed with veto-proof supermajorities after one House Democrat, Fayetteville Rep. Charles Smith, crossed party lines to support it. Republicans only need one Democrat in the House, and none in the Senate, to override Stein’s vetoes as long as all Republicans are also on board.
It’s possible Smith’s vote could still change, either on the final version of the bill when it comes back to the House — likely to happen this coming week — or on a hypothetical veto override down the line. Stein and House Speaker Destin Hall will be working against each other to win Smith over. Smith declined to comment Thursday.