/CFM/-7H3^I .^ ^/y^b /
The
^ORTH CAROLINA
REGISTER
IN THIS ISSUE
GENERAL STATUTES
EXECUTIVE ORDERS
FINAL DECISION LETTER
PROPOSED RULES
Crime Control and Public Safety
Environment, Health, and Natural Resources
Human Resources
FINAL RULES f?ECE»VED
Revenue
List of Rules Codified
ARRC OBJECTIONS
OCT
CAW
15 1991
LIBRARY
RULES INVALIDATED BY JUDICIAL DECISION
ISSUE DATE: SEPTEMBER 30, 1991
Volume 6 • Issue 13 • Pages 784-923
INFORMATION ABOUT THE NORTH CAROLINA REGISTER AND ADMINISTRATIVE CODE
NORTH CAROLINA REGISTER
The North Carolina Register is published bi-monthly
and contains information relating to agenc>', executi\e,
legislati\e and judicial actions required b>' or affecting
Chapter 150B of the General Statutes. All proposed, ad-ministrative
rules and amendments filed under Chapter
150B must be published in the Register. The Register
will t>pically comprise approximately fifty pages per
issue of legal text.
State law requires that a copy of each issue be pro-
\ided free of charge to each county in the state and to
various state officials and institutions. The North CaroHna
Register is a\ailable by yearly subscription at a cost of
one hundred and five dollars ($105.00) for 24 issues.
Requests for subscriptions to the North Carolina
Register should be directed to the Office of Ad-ministrative
Hearings, P. O. Drawer 27447, Raleigh, N.
C. 27611-7447, Attn: Subscriptions.
ADOPTION, AMENDMENT, AND REPEAL OF
RULES
An agency intending to adopt, amend, or repeal a rule
must first publish notice of the proposed action in the
North Carolina Register. The notice must include the
time and place of the public hearing; a statement of how-public
comments may be submitted to the agency either
at the hearing or otherwise; the text of the proposed
rule or amendment; a reference to the Statutory
Authority for the action and the proposed effective date.
The Director of the Office of Administrati\e Hearings
has authority to publish a summary, rather than the
full text, of any amendment which is considered to be
too lengthy. In such case, the full text of the rule con-taining
the proposed amendment will be available for
public inspection at the Rules Division of the Office of
Administrati\e Hearings and at the office of the pro-mulgating
agency.
Unless a specific statute pro\'ides otherwise, at least
30 days must elapse following publication of the pro-posal
in the North Carolina Register before the agencv
may conduct the required public hearing and take ac-tion
on the proposed adoption, amendment or repeal.
When final action is taken, the promulgating agency
must file any adopted or amended rule for approval by
the Administrati\'e Rules Re\iew Commission. Upon ap-proval
of ARRC, the adopted or amended rule must be
filed with the Office of Administrative Hearings. If it
differs substantially from the proposed form published
as part of the public notice, upon request b>- the agen-cy,
the adopted \ersion will again be published in the
North Carolina Register.
A rule, or amended rule cannot become effective
earlier than the first day of the second calendar month
after the adoption is filed with the Office of Ad-ministrative
Hearings for publication in the NCAC.
Proposed action on rules may be withdrawn by the
promulgating agency at any time before final action is
taken by the agency.
TEMPOIL4RY RULES
Under certain conditions of an emergency' nature,
some agencies may issue temporary rules. A temporary-rule
becomes effective when adopted and remains in
effect for the period specified in the rule or 180 days,
whichever is less. An agency adopting a temporary rule
must begin normal rule-making procedures on the per-manent
rule at the same time the temporary rule is
adopted.
NORTH CAROLINA ADMINISTRATIVE CODE
The North Carolina Administrati\-e Code (NCAC) is
a compilation and index of the administrative rules of
25 state agencies and 38 occupational licensing boards.
The NCAC comprises approximately 15,000 letter size,
single spaced pages of material of which approximate-ly
35% is changed annually. Compilation and publica-tion
of the NCAC is mandated by G.S. 150B-63(b).
The Code is di\-ided into Titles and Chapters. Each
state agency is assigned a separate title which is fur-ther
broken down by chapters. Title 21 is designated
for occupational licensing boards.
The NCAC is available in two formats.
(1) Single pages may be obtained at a minimum
cost of two dollars and 50 cents ($2.50) for 10
pages or less, plus fifteen cents ($0.15) per each
additional page.
(2) The full publication consists of 53 volumes,
totaling in excess of 15,000 pages. It is sup-plemented
monthly with replacement pages. A
one year subscription to the full publication in-cluding
supplements can be purchased for
seven hundred and fifty dollars ($750.00). In-di\-
idual \-olumes may also be purchased with
supplement service. Renewal subscriptions for
supplements to the initial publication a\-ailable
Requests for pages of rules or \-olumes of the NCAC
should be directed to the Office of Administrativ*
Hearings.
NOTE
The foregoing is a generalized statement of the pro
cedures to be folloN^ed. For specific statutory- language
it is suggested that Articles 2 and 5 of Chapter I50B o
the General Statutes be examined carefully.
CITATION TO THE NORTH CAROLINA
REGISTER
The North Carolina Register is cited bv \-olume, issue
page number and date. 1:1 NCR 101-201, April 1, 198
refers to Volume 1, Issue 1, pages 101 through 201 o
the North Carolina Register issued on April 1, 1986.
North Carolina Register. Published bi-monthly by the
Office of Administrative Hearings, P.O. Drawer 27447,
Raleigh, North Carolina 27611-7447, pursuant to
Chapter 150B of the General Statutes. Subscriptions
one hundred and fi\-e dollars (S105.00) per year.
North Carolina Administrative Code. Published in
looseleaf notebooks with supplement service by the
Office of Administrati\e Hearings, P.O. Drawer 27447,
Raleigh, North Carolina 27611-7447, pursuant to
Chapter 150B of the General Satutes. Subscriptions
se\-en hundred and fifty dollars ($750.00). Individual
Nolumes a\ailable.
NORTH
CAROLINA
REGISTER
ISSLE CONTENTS
OJJlce of Administrative Hearings
P. O. Drawer 27447
Raleigh, \C 27611-7447
(919) 733-2678
I. GENERAL STA IT TES
Chapter I SOB 784
II. EXECl TFV E ORDERS
Executive Orders 149-150 804
III. EINAL DECISION LEITER
Voting Rights Act 806
IV. PROPOSED Rl EES
Crime Control and Public
Safety
State Highway Patrol 809
Environment, Health, and
Natural Resources
Health Scnices 815
Land Resources 810
Human Resources
Medical Assistance 807
Julian Mann III,
Director
James R. Scarcella Sr.,
Deputy Director
Molly NIasich,
Director APA Services
Staff:
Ruby Creech,
Publicalions Coordinator
Teresa Kilpatrick,
Editorial Assistant
Jean Shirley,
Editorial Assistant
V. EESAL RULES
Revenue
Corporate Income ;md
Franchise Tax Division 816
Sales and Use Tax 817
List of Rules Codified 907
VI. ARRC OBJECTIONS 916
VII. RULES INV AI IDATED BV
JUDICIAL DECISION 919
VIII. CUMULATIVE INDEX 921
NORTH CAROLINA REGISTER
Publication Schedule
(October 1991 - December 1992)
Issue Last Day Last Day Earliest
Date for for Date for
Filing Electronic Public
Filing Hearing
Earliest
Date for
Adoption
by
Agency
Last Day *
to Earliest
Submit Effective
to Date
RRC
++*++++++++++*+++++++*++++++*+++++*+**++++++++*++++++++*++++++++++
10/01/91
10/15/91
11,01/91
11/15/91
12/02/91
12/16'91
01/02/92
01/15/92
02/03/92
02/14/92
03/02/92
03/16/92
04 01,92
04/15/92
05/01/92
05/15/92
06/01/92
06/15/92
07/01/92
07/15/92
08/03/92
08/14/92
09/01 92
09/15 92
10/01/92
10/15/92
11/02/92
11/16/92
12 01/92
12/15/92
09/10/91
09/24/91
10/11/91
10/24/91
11/07/91
11/21/91
12/09/91
12/20/91
01/10/92
01/24/92
02/10/92
02/24/92
03/11/92
03/25/92
04/10/92
04/24/92
05/11/92
05/25/92
06/10/92
06/24/92
07/13/92
07/24/92
08/11/92
08/25/92
09/10/92
09/24/92
10/12/92
10/23/92
11/06/92
11/24/92
09/17/91
10/01/91
10/18/91
10/31/91
11/14/91
12/02/91
12/16/91
12/31/91
01/17/92
01/31/92
02/17/92
03/02/92
03 '18/ 92
04/01/92
04/17/92
05/01/92
05/18/92
06/01/92
06-17,92
07/01 .'92
07/20,92
07/31/92
08/18^92
09/01/92
09,-17/92
10/01/92
10/19/92
10/30/92
11/13/92
12^01/92
10/31/91
10/30/91
11/16/91
11/30/91
12/17/91
12/31/91
01/17/92
01/30/92
02/18/92
02/29/92
03/17/92
03/31/92
04/16/92
04/30/92
05/16/92
05/30/92
06/16/92
06/30/92
07/16/92
07/30/92
08/18/92
08/29/92
09/16/92
09/30/92
10/16/92
10/30/92
11/17/92
12/01/92
12/16/92
12/30/92
10/31/91
11/14/91
12/01/91
12/15/91
01/01/92
01/15/92
01/31/92
02/14,92
03/04/92
03/15/92
04/01/92
04/15/92
05/01/92
05/15/92
05/31/92
06/14/92
07/01/92
07/15/92
07/31/92
08/14/92
09/02/92
09/13/92
10/01/92
10/15/92
10/31/92
11/14/92
12/02/92
12/16/92
12/31/92
01/14/93
11/20/91
11/20/91
12/20/91
12/20/91
01/20/92
01/20/92
02/20/92
02/20/92
03/20/92
03/20/92
04,'20/92
04/20/92
05.'20/92
05/20/92
06/20/92
06/20/92
07/20/92
07/20/92
08/20/92
08/20/92
09/20/92
09/20/92
10/20/92
10/20/92
11/20 92
11/20/92
12/20/92
12/20/92
01/20/93
01/20/93
02/01/92
01/01/92
02/01/92
02/01/92
03/01/92
03/01/92
04/01/92
04/01/92
05/01/92
05/01/92
06/01/92
06/01/92
07/01/92
07,01/92
08/01/92
08/01/92
09/01/92
09/01/92
10/01/92
10/01/92
11/01/92
11/01/92
12 01/92
12/01/92
01/01/93
01/01/93
02/01/93
02/01/93
03/01/93
03,01/93
* The "Earliest Effective Date" is computed assuming that the agency follows
the publication schedule above, that the Rules Review Commission approves the
rule at the next calendar month meeting after submission, and that RRC delivers
the rule to the Codifier of Rules five (5) business days before the 1st of the next
calendar month.
GENERAL STA TUTES OF NOR TH CAROLINA
CHAPTER 150B
THE ADMINISTRATIVE PROCEDURE ACT
[The following excerpt contains the statutory- provisions of the Administrative Procedure Act as
amended by the 1991 Regular Session of the General Assembly effective October 1, 1991, except
150B-l(d)(5) and 150B-l(eX10), effective July 16, 1991.)
Article 1.
General Provisions.
§ 150B-1. Policy and scope.
(a) Purpose. -- This Chapter establishes a uni-form
system of administrative rule making and
adjudicatory procedures for agencies. Ihe pro-cedures
ensure that the functions of rule making,
investigation, advocacy, and adjudication are not
all performed by the same person in the admin-istrative
process.
(b) Rights. -- rhis Chapter confers procedural
rights.
(c) Full Exemptions. — This Chapter appUes
to every agency except:
(1) The North Carolina National Guard in
exercising its court-martial jurisdiction.
The Department of Human Resources in
exercising its authority over the Camp
Butner reservation granted in Article 6 of
Chapter 122C of the General Statutes.
The Ltihties Commission.
The Industrial Commission.
The Employment Security Commission.
Exemptions From Rule Making. -- Article
2A of this Chapter does not apply to the follow-ing:
The Commission.
The North Carolina Low- Level Radioac-tive
Waste Management Authority in ad-ministering
the provisions of G.S.
104G-10andG.S. 104G-11.
The North Carolina Hazardous Waste
Management Commission in administer-ing
the provisions of G.S. BOB- 13 and
G.S. 130B-14.
The Department of Revenue, except that
Parts 3 and 4 of /Vrticle 2A apply to the
Department.
The North Carolina Air Cargo /Virport
Authority with respect to the acquisition,
construction, operation, or use, including
fees or charges, of any portion of a cargo
airport complex.
Exemptions From Contested Case Pro-visions.
-- The contested case provisions of this
Chapter apply to all agencies and all proceedings
(2)
(3)
(4)
(5)
(d)
(1)
(2)
(3)
(4)
(5)
(e)
not expressly exempted from the Chapter. The
contested case provisions of this Chapter do not
apply to the following:
(1) The Department of Human Resources
and the Department of Environment,
Health, and Natural Resources in com-plying
with the procedural safeguards
mandated by Section 680 of Part H of
Public Law 99-457 as amended (Educa-tion
of the Handicapped Act Amend-ments
of 1986).
(2) The Governor's Waste Management
Board in administering the provisions of
G.S. 104E-6.2 and G.S. 130A-293.
(3) The North Carolina Low-Level Radio-active
Waste Management Authority in
administering the provisions of G.S.
104G-9, 104G-10, and 104G-11.
(4) The North Carolina Hazardous Waste
Management Conunission in administer-ing
the provisions of G.S. 130B-11,
130B-13, and 130B-14.
(5) Hearings required pursuant to the Reha-bilitation
Act of 1973, (Public Law
93-122), as amended and federal regu-lations
promulgated thereunder. G.S.
150B-51(a) is considered a contested case
hearing provision that does not apply to
these hearings.
(6) The Department of Revenue.
(7) The Department of Correction.
(8) The Department of Transportation, ex-cept
as provided in G.S. 136-29.
(9) The Occupational Safety and Health Re-view
Board in all actions that do not in-volve
agricultural employers.
(10) The North Carolina Air Cargo Airport
Authority with respect to the acquisition,
construction, operation, or use, including
fees or charges, of any portion of a cargo
airport complex,
(f) Exemption From All But Judicial Review.
— No Article in this Chapter except Article 4
applies to the University of North CaroUna.
§ 150B-2. Definitions. - As used in this
Chapter,
6:13 NORTH CAROLINA REGISTER September 30, 1991 784
GENERAL STA TUTES OF NORTH CAROLINA
(01 ) "/\dininistrative law judge" means a per-son
appointed under G.S. 7A-752,
7A-753, or 7A-757.
(1) "Agency" means an agency or an otTicer
in the executi\-e branch of the government
of this State and includes the Council of
State, the Governor's OtTice, a board, a
commission, a department, a division, a
council, and any other unit of government
in the executive branch. A local unit of
government is not an agency.
(la) "Adopt" means to take fmal action to
create, amend, or repeal a rule.
(lb) "Coditler of Rules" means the Chief
Administrative Law Judge of the OlTice
of Administrative Hearings or a desig-nated
representati\e of the Chief Admin-istrative
Law Judge.
(Ic) "Commission" means the Rules Review
Commission.
(2) "Contested case" means an administrative
proceeding pursuant to this Chapter to
resolve a dispute between an agency and
another person that invohes the person's
nglits, duties, or privileges, including li-censing
or the lew of a monetar>' penalty.
"Contested case" does not include
rulemaking, declaratorv' rulings, or the
award or denial of a scholarship or grant.
Repealed.
"Hearing officer" means a person or
group of persons designated by an agency
that is subject to /Vrticle 3A of this Chap-ter
to preside in a contested case hearing
conducted under that /Vrticle.
"License" means any certificate, permit
or other evidence, by whatever name
called, of a right or privilege to engage in
any activity, except licenses issued under
Chapter 20 and Subchapter I of Chapter
105 of the General Statutes and occupa-tional
licenses.
(4) "Licensing" means an\' administrative
action issuing, failing to issue, suspending,
or re\oking a license or occupational li-cense.
"Licensing" docs not include con-tro\
ersies over whether an examination
was fair or whether the applicant passed
the examination.
(4a) "Occupational license" means any certif-icate,
permit, or other e\idence, by what-ever
name caUed, of a right or pnvilege to
engage in a profession, occupation, or
field of endeavor that is issued by an oc-cupational
licensing agency.
(4b) "Occupational licensing agency" means
any board, commission, committee or
other aaencv of the State of North
(Ja)
(2b)
(3)
Carolina which is established for the pri-mar,'
purpose of regulating the entr\' of
persons into, and or the conduct of per-sons
within a particular profession, occu-pation
or field of endeavor, and which is
authorized to issue and re\'oke licenses.
"Occupational hcenstng agency" does not
include State agencies or departments
which may as only a part of their regular
function issue permits or hcenses.
(5) "Party" means any person or agency
named or admitted as a party or properly
seeking as of right to be admitted as a
party and includes the agency as appro-priate.
This subdivision does not permit
an agency that makes a fmal decision, or
an officer or employee of the agency, to
petition for initial judicial re\iew of that
decision.
(6) "Person aggrieved" means any person or
group of persons of common interest di-rectly
or indirectly affected substantially in
his or its person, property, or employment
by an administrative decision.
(7) "Person" means any natural person, part-nership,
corporation, body politic and any
unincorporated association, organization,
or society which may sue or he sued under
a common name.
(8) "Residence" means domicile or principal
place of business.
(8a) "Rule" means any agency regulation,
standard, or statement of general apphca-bility
that implements or interprets an
enactment of the General Assembly or
Congress or a regulation adopted by a
federal agency or that describes the pro-cedure
or practice requirements of an
agency. The term includes the establish-ment
of a fee and the amendment or re-peal
of a pnor rule. The term does not
include the following:
a. Statements concerning only the internal
management of an agency or group of
agencies within the same principal office
or department enumerated m G.S. 143-11
or 143B-6, including policies and proce-dures
manuals, if the statement does not
directly or substantially affect the proce-dural
or substantive rights or duties of a
person not employed by the agency or
group of agencies.
b. Budgets and budget pohcies and proce-dures
issued by the Director of the
Budget, bv the head of a department, as
defmed by G.S. 143A-2 or G.S. 143B-3,
by an occupational licensing board, as
785 6:13 NORTH CAROLINA REGISTER September 30, 1991
GENERAL STA TUTES OF NOR TH CAROLINA
defined by G.S. 93B-1, or by the State
Board of Elections.
c. Nonbinding interpretive statements
within the delegated authority of an
agency that merely defme, interpret, or
explain the meaning of a statute or rule.
d. A form, the contents or substantive re-quirements
of which are prescribed by rule
or statute.
e. Statements of agency pohcy made in the
context of another proceeding, including:
1. Declaratory rulings under G.S. 150B-4;
2. Orders estabhshing or fixing rates or
tariffs.
f Requirements, communicated to the
public by the use of signs or symbols,
concerning the use of pubhc roads,
bridges, ferries, buUdings, or facilities,
g. Statements that set forth criteria or
guidelines to be used by the staff of an
agency in performing audits, investi-gations,
or inspections; in setthng financial
disputes or negotiating fmancial arrange-ments;
or in the defense, prosecution, or
settlement of cases,
h. Scientific, architectural, or engineering
standards, forms, or procedures, including
design criteria and construction standards
used to construct or maintain highways,
bridges, or ferries.
i. Job classification standards, job quali-fications,
and salaries estabUshed for posi-tions
under the jurisdiction of the State
Personnel Commission,
j. Establishment of the interest rate that
applies to tax assessments under G.S.
105-241.1 and the variable component of
the excise tax on motor fuel under G.S.
105-434.
(8b) ''Substantial evidence" means relevant
evidence a reasonable mind might accept
as adequate to support a conclusion.
(9) Repealed,
§ 150B-3. Special provisions on licensing.
(a) When an apphcant or a licensee makes a
timely and sufficient apphcation for issuance or
renewal of a license or occupational license, in-cluding
the payment of any required license fee,
the existing license or occupational license does
not expire until a decision on the application is
fmally made by the agency, and if the application
is denied or the terms of the new license or oc-cupational
license are limited, until the last day
for applying for judicial review of the agency or-der.
This subsection does not affect agency
action summarily suspending a license or occu-pational
hcense under subsections (b) and (c) of
this section.
(b) Before the commencement of proceedings
for the suspension, revocation, annulment, with-drawal,
recall, cancellation, or amendment of any
License other than an occupational license, the
agency shall give notice to the hcensee, pursuant
to the provisions of G.S. 150B-23. Before the
commencement of such proceedings involving an
occupational license, the agency shall give notice
pursuant to the provisions of G.S. 150B-38. In
either case, the licensee shall be given an oppor-tunity
to show compliance with all lawful re-quirements
for retention of the license or
occupational hcense.
(c) If the agency fmds that the pubhc health,
safety, or welfare requires emergency action and
incorporates this fmding in its order, summary
suspension of a license or occupational hcense
may be ordered effective on the date specified in
the order or on service of the certified copy of the
order at the last known address of the hcensee,
whichever is later, and effective during the pro-ceedings.
The proceedings shall be promptly
commenced and determined.
Nothing in this subsection shall be construed
as amending or repealing any special statutes, in
effect prior to Eebruary 1, 1976, which provide
for the summary' suspension of a hcense.
§ 150B-4. Declaratory rulings.
(a) On request of a person aggrieved, an agency
shall issue a declaratory ruling as to the validity
of a rule or as to the apphcability to a given state
of facts of a statute administered by the agency
or of a rule or order of the agency, except when
the agency for good cause finds issuance of a
ruling undesirable. The agency shall prescribe in
its rules the circumstances in which rulings shall
or shall not be issued. A declaratory ruling is
binding on the agency and the person requesting
it unless it is altered or set aside by the court.
An agency may not retroactively change a
declaratory ruling, but nothing in this section
prevents an agency from prospectively changing
a declaratory ruling. A declarator)' ruling is
subject to judicial review in the same manner as
an order in a contested case. Failure of the
agency to issue a declaratory ruhng on the merits
within 60 days of the request for such ruling shall
constitute a denial of the request as well as a de-nial
of the merits of the request and shall be
subject to judicial re\iew.
(b) This section does not apply to the Depart-ment
of Correction.
/Vrticle 2.
Rule Making.
Repealed.
6:13 NORTH CAROLINA REGISTER September 30, 1991 786
GENERAL STA TUTES OF NORTH CAROLINA
/\rlicle 2A.
Rules.
Part 1. General Provisions.
§ I50B-18. Scope and effect.
This /Vrticle applies to an agency's exercise of its
authority to adopt a rule. A rule is not valid
unless it is adopted in substantial compliance
with this .Article.
§ 150Ei-19. Restrictions on what can be
adopted as a rule.
An agency may not adopt a rule that does one
or more of the following:
(1) Implements or interprets a law unless that
law or another law specifically authorizes
the agency to do so.
(2) Enlarges the scope of a profession, occu-pation,
or field of endeavor for which an
occupational license is required.
(3) Imposes criminal liability or a ci\'il penalty
for an act or omission, including the vio-lation
of a rule, unless a law specifically
authorizes the agency to do so or a law
declares that violation of the rule is a
criminal offense or is grounds for a civU
penalty.
(4) Repeats the content of a law, a rule, or a
federal regulation.
(5) Establishes a reasonable fee or other rea-sonable
charge for providing a ser\'ice in
fulfillment of a duty unless a law specif-ically
authorizes the agency to do so or
the fee or other charge is for one of the
foUowing:
a. A ser\'ice to a State, federal, or local
governmental unit.
b. A copy of part or all of a State publica-tion
or other document, the cost of mail-ing
a document, or both.
c. A transcript of a public hearing.
d. A conference, workshop, or course.
e. Data processing services.
(6) .Allows the agency to waive or modify a
requirement set in a rule unless a rule es-tablishes
specific guidelines the agency
must follow in determining whether to
waive or modify the requirement.
§ I50B-20. Petitioning an agency to adopt a
rule.
(a) Petition. - A person may petition an
agency to adopt a rule by submitting to the
agency a written rule-making petition requesting
the adoption. A person may submit written
comments with a rule-making petition. If a
rule-makmg petition requests the agency to create
or amend a rule, the person must submit the
proposed text of the requested rule change and a
statement of the effect of the requested rule
change. Each asencv must establish bv rule the
procedure for submitting a rule-making petition
to it and the procedure the agency follows in
considering a rule-making petition.
(b) Time. — An agency must grant or deny a
rule-making petition submitted to it within 30
days after the date the rule-making petition is
submitted, unless the agency is a board or com-mission.
If the agency is a board or commission,
it must grant or deny a rule-making petition
within 120 days after the date the rule-making
petition is submitted.
(c) Action. -- If an agency denies a rule-making
petition, it must send the person who submitted
the petition a written statement of the reasons for
denying the petition. If the agency grants a
rule-making petition, it must inform the person
who submitted the rule-making petition of its
decision and must initiate rule-making pro-ceedings.
When an agency grants a rule-making
petition requesting the creation or amiendment
of a rule, the notice of rule making it pubhshes
in the North Carolina Register may state that the
agency is initiating rule-making proceedings as
the result of a rule-making petition, state the
name of the person who submitted the rule-making
petition, set out the text of the requested
rule change submitted with the rule-making peti-tion,
and state whether the agency endorses the
proposed nile change.
(d) Review. — Denial of a rule-making petition
is a final agency decision and is subject to judicial
review under /Vrticle 4 of this Chapter. Failure
of an agency to grant or deny a rule-making pe-tition
within the tmie limits set in subsection (b)
is a denial of the rule-making petition.
(e) Exception. -- This section does not apply
to the Department of Correction.
§ 150B-21. .Agency must designate rule-making
coordinator.
Each agency must designate one or more rule-making
coordinators to oversee the agency's
rule-making functions. The coordinator must
prepare notices of public hearings, coordinate
access to the agency's rules, and serve as the liai-son
between the agency, other agencies, and the
public in the rule-making process.
Part 2. .-\doption of Rules.
§ 150B-2I.I. Procedure for adopting a tem-porary
rule.
(a) .Adoption. -- .An agency may adopt a tem-porary
rule without prior notice or hearing or
upon any abbreviated notice or hearing the
agency fmds practical when it fmds that adher-ence
to the notice and hearing requirements of
this Part would be contrary to the public interest
and that the immediate adoption of the rule is
required by one or more of the following:
787 6:li NORTH CAROLINA REGISTER September iO, 1991
GENERAL STA TUTES OF NORTH CAROLINA
(1) A serious and unforeseen threat to the
public heahh, safety, or welfare.
(2) The effective date of a recent act of the
General Assembly or the United States
Congress.
(3) A recent change in federal or State budg-etary
policy.
(4) A federal regulation.
(5) A court order.
An agency must prepare a written statement of
its findings of need for a temporary rule. The
statement must be signed by the head of the
agency adopting the rule.
An agency must begin rule-making proceedings
for a permanent rule by the day it adopts a tem-porary
rule. An agency begins rule-making pro-ceedings
for a permanent rule by submitting to
the codifier written notice of its intent to adopt
a permanent rule.
(b) Review. — When an agency adopts a tem-porary
rule it must submit the rule, the agency's
written statement of its fmdings of need for the
rule, and the notice of intent to adopt a perma-nent
rule to the Codifier of Rules. Withm one
business day after an agency submits a temporary
rule, the Codifier of Rules must review the agen-cy's
written statement of fmdings of need for the
rule to determine whether the statement of need
meets the criteria listed in subsection (a). In re-viewing
the statement, the Codifier of Rules may
consider any information submitted by the
agency or another person. If the Codifier of
Rules finds that the statement meets the criteria,
the Codifier of Rules must notify the head of the
agency and enter the rule in the North Carolina
Administrative Code.
If the Codifier of Rules fmds that the statement
does not meet the criteria, the Codifier of Rules
must immediately notify the head of the agency.
The agency may supplement its statement of
need with additional fmdings or submit a new
statement. If the agency provides additional
findings or subiiuts a new statement, the Codifier
of Rules must review the additional fmdings or
new statement within one business day after the
agency submits the additional findings or new
statement. If the Codifier of Rules again fmds
that the statement does not meet the criteria
listed in subsection (a), the Codifier of Rules
must immediately notify the head of the agency.
If an agency decides not to provide additional
fmdings or submit a new statement when notified
by the Codifier of Rules that the agency's
fmdings of need for a rule do not meet the re-quired
criteria, the agency must notify the
Codifier of Rules of its decision. The Codifier
of Rules must then enter the rule in the North
Carolina Administrative Code on the sixth busi-ness
day after receiving notice of the agency's
decision.
(c) Standing. — A person aggrieved by a tem-porary
rule adopted by an agency may fde an
action for declaratory judgment in Wake County
Superior Court pursuant to Article 26 of Chapter
1 of the General Statutes. In the action, the
court shall determine whether the agency's writ-ten
statement of findings of need for the rule
meets the criteria listed in subsection (a) and
whether the rule meets the standards in G.S.
150B-21.9 that apply to review of a permanent
rule. The court may not grant an ex parte tem-porary
restraining order.
Filing a petition for rule making or a request for
a declaratory ruling with the agency that adopted
the rule is not a prerequisite to filing an action
under this subsection. A person who files an
action for declaratory judgment under this sub-section
must serve a copy of the complaint on
the agency that adopted the rule being contested,
the Codifier of Rules, and the Commission.
(d) Effective Date and Expiration. -- A tem-porary
rule becomes effective on the date speci-fied
in G.S. 150B-21.3. A temporary rule expires
on the date specified in the rule or 1 80 days from
the date the rule becomes effective, whichever
comes first.
§ I50B-21.2. Procedure for adopting a per-manent
rule.
(a) Notice. — Before an agency adopts a per-manent
rule, it must publish notice of its intent
to adopt a permanent rule in the North Carolina
Register and as required by any other law. The
notice published in the North Carolina Register
must include all of the following:
(1) Either the text of the proposed rule or a
statement of the subject matter of the
proposed rule making.
(2) A short explanation of the reason for the
proposed action.
(3) A citation to the law that gives the agency
the authority to adopt the proposed rule,
if the notice includes the text of the pro-posed
rule, or a citation to the law that
gives the agency the authority to adopt a
rule on the subject matter of the proposed
rule making, if the notice includes only a
statement of the subject matter of the
proposed rule making.
(4) The proposed effective date of the pro-posed
rule, if the notice includes the text
of the proposed rule, or the proposed ef-fective
date of a rule adopted on the sub-ject
matter of the proposed rule making,
if the notice includes only a statement of
the subject matter of the proposed rule
making.
6:li NORTH CAROLINA REGISTER September 30, 1 99
1
788
GENERAL STA TUTES OF NORTH CAROLINA
(5) The date, time, and place of any public
hearing scheduled on the proposed rule
or subject matter of the proposed rule
making.
(6) Instructions on how a person may demand
a public hearing on a proposed rule if the
notice does not schedule a pubhc hearing
on the proposed rule and subsection (c)
requires the agency to hold a pubhc hear-ing
on the proposed rule when requested
to do so.
(7) The period of time during vshich and the
person to whom written comments may
be submitted on the proposed rule or
subject matter of the proposed rule mak-ing.
(8) If a fiscal note has been prepared for the
proposed rule or will be prepared when a
rule is proposed on the subject matter of
the proposed rule making, a statement
that a copy of the fiscal note can be ob-tained
from the agency.
(b) Mailing List. -- .\n agency must maintain
a mailing hst of persons who have requested no-tice
of rule making. WTien an agency pubUshes
a rule-making notice in the North Carolina Reg-ister,
it must mail a copy of the notice to each
person on the maihng hst who has requested
notice of rule-making proceedings on the rule or
the subject matter for rule making described in
the notice. /Vn agency may charge an annual fee
to each person on the agency's mailing hst to
cover copying and mailing costs.
(c) Heciring. -- .\n agency must hold a pubhc
hearing on a rule it proposes to adopt in two
circumstances and may hold a pubhc hearing in
other circumstances. WTien an agency is required
to hold a public hearing on a proposed rule or
decides to hold a pubhc hearing on a proposed
rule when it is not required to do so, the agency
must pubhsh in the North Carolina Register a
notice of the date, time, and place of the pubhc
hearing. The hearing date of a public hearing
held after the agency pubhshes notice of the
hearing in the North Carolina Register must be
at least 15 days after the date the notice is pub-hshed.
An agency must hold a pubhc hearing on a rule
it proposes to adopt in the following two cir-cumstances:
( 1) The agency pubhshes a statement of the
subject matter of the proposed rule mak-ing
in the notice in the North Carolina
Register.
(2) The agency pubhshes the text of the pro-posed
rule in the notice in the North
Carohna Register and all the following
apply:
a. TTie notice does not schedule a pubhc
hearing on the proposed rule.
b. Within 15 days after the notice is pub-hshed,
the agency receives a written re-quest
for a pubhc hearing on the proposed
rule.
c. The proposed rule is not part of a rule-making
proceeding the agency initiated by
pubhshing a statement of the subject
matter of proposed rule making.
d. The proposed text is not a changed \'er-sion
of proposed te.xt the agency previ-ously
pubhshed in the course of
rule-making proceedings but did not
adopt.
(d) Text After Subject-Matter Notice. -- When
an agency pubhshes notice of the subject matter
of proposed rule making in the North Carolina
Register, it must subsequently pubhsh in the
North Carohna Register the text of the rule it
proposes to adopt as a result of the pubhc hear-ing
and of any comments received on the subject
matter. An agency may not pubhsh the pro-posed
text of a rule for which it pubhshed a
subject-matter notice before the pubhc hearing
on the subject matter.
(e) Comments. — .An agency must accept
comments on the te.xt of a proposed rule pub-hshed
in the North Carohna Register for at least
30 days after the text is pubhshed or until the
date of any pubhc hearing held on the proposed
rule, whichever is longer. An agency must accept
comments on a statement of the subject matter
of proposed rule making until the pubhc hearing
on the subject matter. An agency must consider
fuUy aU v/ritten and oral comments received.
(f) Adoption. -- An agency may not adopt a
rule until the time for commenting on the pro-fKised
text of the rule has elapsed and may not
adopt a rule if more than 12 months have elapsed
since the end of the time for commenting on the
proposed text of the rule. An agency may not
adopt a rule that differs substantiaUy from the
text of a proposed rule pubhshed m the North
Carolina Register unless the agency pubhshes the
text of the proposed different rule in the North
Carolina Register and accepts comments on the
proposed different rule for the time set in sub-section
(e).
An adopted rule differs substantiaUy from a
proposed rule if it does one or more of the fol-lowing:
(1) .Affects the interests of persons who, based
on the notice pubhshed in the North
Carolina Register or the proposed text of
the rule, could not reasonably have deter-mined
that the rule would affect their in-terests.
789 6:13 NORTH CAROLINA REGLSTER September 30, 1 991
GENERAL STA TUTES OF NOR TH CAROLINA
(2) Addresses a subject matter or an issue that
is not addressed in the proposed text of
the rule.
(3) Produces an effect that could not reason-ably
have been expected based on the
proposed text of the rule.
When an agency adopts a rule, it may not take
subsequent action on the rule without following
the procedures in this Part.
(g) Explanation. -- An agency must issue a
concise written statement explaining why the
agency adopted a rule if, within 30 days after the
agency adopts the rule, a person asks the agency
to do so. The explanation must state the prin-cipal
reasons for and against adopting the rule
and must discuss why the agency rejected any
arguments made or considerations urged against
the adoption of the rule.
(h) Record. — An agency must keep a record
of a rule-making proceeding. 1 he record must
include all written comments received, a tran-script
or recording of any public hearing held on
the rule, and any written explanation made by
the agency for adopting the rule.
§ 150B-21.3. Kffcctive date of rules.
(a) Temporary Rule. — A temporary rule be-comes
effective on the date the Codifier of Rules
enters the rule in the North Carolina Adminis-trative
Code.
(b) Permanent Rule. — A permanent rule ap-proved
by the Commission becomes ctTccti\e five
business days after the Commission delivers the
rule to the Codifier of Rules, unless the agency
adopting the rule specifies a later effective date.
If the agency specifies a later effective date, the
rule becomes efTective on that date.
A permanent rule that is not approved by the
Commission becomes effective five business days
after the agency adopting the rule delivers the rule
to the Crodifier of Rules, unless the agency
adopting the rule specifies a later effective date.
If the agency specifies a later effective date, the
rule becomes effective on that date.
(c) OSHy\ Standard. -- A permanent rule con-cerning
an occupational safety and health stand-ard
that is adopted by the Occupational Safety
and Health Division of the Department of Labor
and is identical to a federal regulation
promulgated by the Secretary of the United
States Department of Labor becomes effective
on the date the Division delivers the rule to the
Codifier of Rules, unless the Division specifies a
later effective date. If the Division specifies a
later effective date, the rule becomes effective on
that date.
§ 150B-21.4. Fiscal notes on rules.
(a) State Funds. — Before an agency publishes
in the North Carolina Register the proposed text
of a permanent rule change that would require
the expenditure or distribution of funds subject
to the Executive Budget Act, Article 1 of Chapter
143, it must submit the text of the proposed rule
change and a fiscal note on the proposed rule
change to the Director of the Budget and obtain
certification from the Director that the funds that
would be required by the proposed rule change
are available. The fiscal note must state the
amount of funds that would be expended or dis-tributed
as a result of the proposed rule change
and explain how the amount was computed.
The Director of the Budget must certify a pro-posed
rule change if funds are available to cover
the expenditure or distribution required by the
proposed rule change.
(b) Local Funds. -- Before an agency publishes
in the North Carolina Register the proposed text
of a permanent rule change that would affect the
expenditures or revenues of a unit of local gov-ernment,
it must submit the text of the proposed
rule change and a fiscal note on the proposed rule
change to the Fiscal Research Division of the
General Assembly, the Office of State Budget
and Management, the North Carolina Associ-ation
of County Commissioners, and the North
Carolina League of MunicipaUties. The fiscal
note must state the amount by which the pro-posed
rule change would increase or decrease ex-penditures
or revenues of a unit of local
government and must explain how the amount
was computed.
(c) Errors. — An erroneous fiscal note prepared
in good faith does not affect the validity of a rule.
§ I50B-2L5. Circumstances when notice and
rule-making hearing not required.
(a) Amendment. -- An agency is not required
to pubhsh a notice of rule making in the North
Carolina Register or hold a public hearing when
it proposes to amend a rule, without changing
the substance of the rule, to do one of the fol-lowing:
(1) Reletter or renumber the rule or subparts
of the rule.
(2) Substitute one name for another when an
organization or position is renamed.
(3) Correct a citation in the rule to another
rule or law when the citation has become
inaccurate since the rule was adopted be-cause
of the repeal or renumbering of the
cited rule or law.
(4) Change information that is readily avail-able
to the public, such as an address or
a telephone number.
(5) Correct a typographical error made in en-tering
the rule in the North Carolina Ad-ministrative
Code.
6:13 NORTH CAROLINA REGISTER September 30, I99I 790
GENERAL STA TUTES OF NORTH CAROLINA
(6) Change a rule in response to a request or
an objection by the Commission.
(b) Repeal. — An agency is not required to
publish a notice of rule making in the North
Carolina Register or hold a pubKc hearing when
it proposes to repeal a rule as a result of any of
the following:
(Ij The law under which the rule was adopted
is repealed.
(2) The law under which the rule was adopted
or the rule itself is declared unconstitu-tional.
(3) The rule is declared to be in excess of the
agency's statutory authority.
(c) OSHA Standard. -- The Occupational
Safety and Health Division of the Department
of Labor is not required to publish a notice of
rule making in the North Carolina Register or
hold a public hearing when it proposes to adopt
a rule that concerns an occupational safety and
health standard and is identical to a federal regu-lation
promulgated by the Secretary of the
United States Department of Labor. The Occu-pational
Safety and Health Division is not re-quired
to submit to the Commission for review
a rule for which notice and hearing is not re-quired
under this subsection.
§ 150B-21.6. Incorjx)rating material in a rule
by reference.
An agency may incorporate the following ma-terial
by reference in a rule without repeating the
te.\t of the referenced material:
(1) .Another rule or part of a rule adopted by
the agency.
(2) .AH or part of a code, standard, or regu-lation
adopted by another agency, the
federal government, or a generally recog-nized
organization or association.
(3) Material adopted to meet a requirement
of the federal go\emment.
In incorporating material by reference, the
agency must designate in the rule whether or not
the incorporation includes subsequent amend-ments
and editions of the referenced material.
The agency can change this designation only by
a subsequent rule-makmg proceeding. The
agency must have copies of the incorporated
material available for inspection and must specify
in the rule both where copies of the material can
be obtained and the cost on the date the rule is
adopted of a copy of the material.
.A statement in a rule that a rule incorporates
matenal by reference in accordance with former
G.S. 1 SOB- 14(b) is a statement that the rule does
not include subsequent amendments and editions
of the referenced material. A statement in a rule
that a rule incorporates material by reference in
accordance with former G.S. 1503- 14(c) is a
statement that the rule includes subsequent
amendments and editions of the referenced ma-terial.
§ 150B-21.7. Effect of transfer of duties or
termination of agency on rules.
WTien a law that authorizes an agency to adopt
a rule is repealed and another law gives the same
or another agency substantially the same author-ity
to adopt a rule, the rule remains in effect until
the agency amends or repeals the rule. \\Tien a
law that authorizes an agency to adopt a rule is
repealed and another law does not gi\e the same
or another agency substantially the same author-ity
to adopt a rule, a rule adopted under the re-pealed
law is repealed as of the date the law is
repealed.
WTien an executive order abolishes part or all
of an agency and transfers a function of that
agency to another agency, a rule concerning the
transferred function remains in effect until the
agency to which the function is transferred
amends or repeals the rule. When an executive
order abolishes part or aU of an agency and does
not transfer a function of that agency to another
agency, a rule concerning a function abolished
by the executive order is repealed as of the effec-tive
date of the executive order.
ITie Director of Fiscal Research of the General
Assembly must notify the Codifier of Rules when
a rule is repealed under this section. WTien no-tified
of a rule repealed under this section, the
Codifier of Rules must enter the repeal of the rule
in the North Carolina Administrative Code.
Part 3. Re\iew by Commission.
§ 150B-21.8. Review of rule by Commission.
(a) TemporaPv' Rule. -- The Commission does
not review a temporary rule.
(b) Permanent Rule. -- An agency must submit
a permanent rule adopted by it to the Commis-sion
before the rule can be included m the North
Carolina Administrative Code. TTie Commission
reviews a permanent rule in accordance \\ ith the
standards in G.S. 150B-21.9 and follows the
procedure in this Part in its review of a perma-nent
rule.
(c) Scope. -- WTien the Commission reviews
an amendment to a rule, it may review the entire
rule that is being amended. The procedure in
G.S. 150B-21.12 applies when the Commission
objects to a part of a rule that is within its scope
of review but is not changed by a rule amend-ment.
§ 150B-21.9. Standards and timetable for re-view
by Commission.
(a) Standards. -- The Commission must deter-mine
whether a rule meets all of the following
criteria:
791 6: 13 NOR TH CAROLINA REGIS TER September 30, 1 991
GENERAL STATUTES OF NORTH CAROLINA
(1) It is within the authority delegated to the
agency by the General Assembly.
(2) It is clear and unambiguous.
(3) It is reasonably necessary to fulfill a duty
delegated to the agency by the General
Assembly.
The Commission may determine if a rule sub-mitted
to it was adopted in accordance with Part
2 of this /Vrticle. The Commission must notify
the agency that adopted the rule if it determines
that a rule was not adopted in accordance with
Part 2 of this Article and must retum the rule to
the agency. Entry of a rule in the North Carolina
Administrative Code after review by the Com-mission
is conclusive evidence that the rule was
adopted in accordance with Part 2 of this Article.
(b) Timetable. — The Commission must review
a rule submitted to it on or before the twentieth
of a month by the last day of the next month.
The Commission must review a rule submitted
to it after the twentieth of a month by the last
day of the second subsequent month.
§ I50B-21.10. Commission action on perma-nent
rule.
At the first meeting at which a permanent rule
is before the Commission for review, the Com-mission
must take one of the following actions:
(1) Approve the rule, if the Commission de-termines
that the rule meets the standards
for review.
(2) Object to the rule, if the Commission de-termines
that the rule does not meet the
standards for re\iew.
(3) Extend the period for reviewing the rule,
if the Commission determines it needs
additional information on the rule to be
able to decide whether the rule meets the
standards for review.
In reviewing a new rule or an amendment to an
existing rule, the Commission may request an
agency to make technical changes to the rule and
may condition its approval of the rule on the
agency's making the requested technical changes.
§ 150B-21.il. Procedure when Commission
approves permanent rule.
When the Commission approves a permanent
rule, it must notify the agency that adopted the
rule of the Commission's approval and must de-liver
the approved rule to the Codifier of Rules.
The Commission must deliver an approved rule
by the end of the month in which the Commis-sion
approved the rule, unless the agency asks the
Commission to delay the delivery of the rule.
§ 150B-21.12. Procedure >vhen Commission
objects to a permanent rule.
(a) Action. -- When the Commission objects
to a permanent rule, it must send the agency that
adopted the rule a written statement of the ob-jection
and the reason for the objection. The
agency that adopted the rule must take one of the
following actions:
(1) Change the rule to satisfy the Commis-sion's
objection and submit the revised
rule to the Commission.
(2) Submit a written response to the Com-mission
indicating that the agency has de-cided
not to change the rule.
An agency that is not a board or commission
must take one of these actions within 30 days
after receiving the Commission's statement of
objection. A board or commission must take
one of these actions within 30 days after receiving
the Commission's statement of objection or
within 10 days after the board or commission's
next regularly scheduled meeting whichever
comes later.
When an agency changes a rule in response to
an objection by the Commission, the Commis-sion
must determine whether the change satisfies
the Commission's objection. If it does, the
Commission must approve the rule. If it does
not, the Commission must send the agency a
written statement of the Commission's continued
objection and the reason for the continued ob-jection.
A rule to which the Commission has objected
remains under review by the Commission until
the agency that adopted the rule decides not to
satisfy the Commission's objection and makes a
written request to the Commission to retum the
rule to the agency. When the Commission re-turns
a rule to which it has objected, it may send
to the President of the Senate and each member
of the General Assembly a report of its objection
to the rule.
(b) Entry in Code. -- When the Commission
returns a rule to which it has objected to the
agency that adopted the rule, the Commission
must notify the Codifier of Rules of its action
and of the basis of the Commission's objection.
An agency whose rule is returned may file the
rule with the Codifier of Rules. When the
Codifier of Rules enters in the North Carolina
Administrative Code a rule to which the Com-mission
objected, the entry must reflect the
Commission's objection and must state the
standard on which the Commission based its
objection.
§ I50B-21.I3. Procedure when Commission
extends period for review of permanent rule.
When the Commission extends the period for
review of a permanent rule, it must notify the
agency that adopted the rule of the extension and
the reason for the extension. After the Com-mission
extends the period for review of a rule,
it may call a public hearing on the rule. Within
6:U NORTH CAROLINA REGISTER September 30, 1991 792
GENERAL STATUTES OF NORTH CAROLINA
70 days after extending the period for review of
a rule, the Commission must decide whether to
approve the rule, object to the rule, or call a
public hearing on the rule.
§ 150B-2I.I4. Public hearing on a rule.
The Commission may call a public hearing on
a rule when it extends the period for review of the
rule. At the request of an agency, the Commis-sion
may call a public hearing on a rule that is
not before it for review. Calling a public hearing
on a rule not already before the Commission for
re\iew places the rule before the Commission for
review. When the Commission decides to call a
public hearing on a rule, it must publish notice
of the public hearing in the North Carolina
Register.
After a pubUc hearing on a rule, the Commis-sion
must approve the rule or object to the rule
in accordance with the standards and procedures
in this Part. The Commission must make its
decision of whether to approve or object to the
rule within 70 days after the public hearing.
§ 150B-21.15. Declaratory judgment action
authorized when Commission objects to a f)erma-ncnt
rule.
(a) Standing. -- A person aggrieved by a per-manent
rule entered in the North Carolina Ad-ministrati\
e Code with an objection by the
Commission based on a lack of statutory" au-thority
may fde an action for declaratory judg-ment
in Wake County Superior Court pursuant
to Article 26 of Chapter 1 of the General Stat-utes.
In the action, the court shall determine
whether the agency exceeded it authority ia
adopting the rule.
A declaratory judgment action under this sec-tion
must be fded within 90 days after the rule
that is the subject of the action is entered in the
Code. Filing a petition for rule making or a re-quest
for a declarator)' ruling with the agency that
adopted the rule is not a prerequisite to fding an
action under this section. A person who fdes an
action for declaratory judgment under this sec-tion
must ser\'e a copy of the complaint on the
agency that adopted the rule being contested, the
Codifier of Rules, and the Commission.
(b) Record. - Within 10 days after a
declaratory judgment action is filed under this
section, the agency that adopted the rule that is
the subject of the action must send to the court
the original or a certified copy of the record in the
Commission's re\iew of the rule. The record
consists of the rule, the Commission's letter of
objection to the rule, the agency's written re-sponse
to the Commission's letter, and any other
relevant documents before the Commission when
it decided to object to the rule.
(c) Effect. — A rule remains in effect during the
pendency of an action for declaratory judgment
under this section unless the court suspends the
rule after fmding that the agency that adopted the
rule has no substantial likelihood of prevailing in
the action.
(d) Changes. -- While a rule is the subject of a
declaratory judgment action under this section,
the agency that adopted the rule may submit to
the Commission changes in the rule to satisfy the
Commission's objection. If the Commission
determines that changes submitted to it satisfy its
objection, the Commission must accept the
changes and file the revised rule with the Codifier
of Rules. The Codifier must then enter the rule
in the North Carolina Administrative Code.
WTien the Commission determines that changes
submitted to it satisfy its objection, the agency
that submitted the changes must notify the court
of the changes and of the Commission's action.
Part 4. Publication of Code and Register.
§ 150B-21.17. North Carolina Register.
(a) Content. -- The Codifier of Rules must
publish the North Carolina Register. The North
Carolina Register must be published at least two
times a month and must contain the following:
(1) Notices of proposed adoptions of rules.
(2) Notices of receipt of a petition for munic-ipal
incorporation, as required bv G.S.
120-165.
(3) Executive orders of the Governor.
(4) l-'inal decision letters from the United
States Attorney General concerning
changes in laws that affect voting in a ju-risdiction
subject to § 5 of the Voting
Rights Act of 1965, as required by G.S.
120-30.911.
(5) Orders of the Tax Review Board issued
under G.S. 105-241.2.
(6) Other information the Codifier determines
helpful to the pubhc.
(b) Eorm. -- When an agency publishes notice
in the North Carolina Register of the proposed
text of a new rule, the Codifier of Rules must
pubhsh the complete text of the proposed new
rule. In publishing the text of a proposed new
rule, the Codifier must indicate the rule is new
by underlining the proposed text of the rule.
When an agency publishes notice in the North
Carolina Register of the proposed text of an
amendment to an existing rule, the Codifier must
publish the complete text of the rule that is being
amended unless the Codifier determines that
publication of the complete text of the rule being
amended is not necessary to enable the reader to
understand the proposed amendment. In pub-lishing
the text of a proposed amendment to a
793 6:13 NORTH CAROLINA REGISTER September 30, 1991
GENERAL STA TUTES OF NORTH CAROLINA
rule, the Codifier must indicate deleted text with
overstrikes and added text with underlines.
When an agency publishes notice in the North
Carolina Register of the proposed repeal of an
existing rule, the Codifier must publish the com-plete
text of the rule the agency proposes to re-peal
unless the Codifier determines that
publication of the complete text is impractical.
In publishing the text of a rule the agency pro-poses
to repeal, the Codifier must indicate the
rule is to be repealed.
§ 150B-21.18. North Carolina Administrative
Code.
The Codifier of Rules must compile all rules
into a Code known as the North Carolina Ad-ministrative
Code. The format and indexing of
the Code must conform as nearly as practical to
the format and indexing of the North Carolina
General Statutes. The Codifier must publish
printed copies of the Code and may pubhsh the
Code in other forms. The Codifier must keep
the Code current by publishing the Code in a
loose-leaf format and periodically providing new
pages to be substituted for outdated pages, by
publishing the Code in volumes and periodically
pubhshing cumulative supplements, or by an-other
means. The Codifier must keep superseded
rules.
§ 150B-21.19. Requirements for Including rule
in Code.
To be acceptable for inclusion in the North
Carolina Administrative Code, a rule must:
(1) Cite the law under which the rule is
adopted.
(2) Be signed by the head of the agency or the
rule-making coordinator for the agency
that adopted the rule.
(3) Be in the physical form specified by the
Codifier of Rules.
(4) flave been reviewed by the Commission,
if the rule is a permanent rule.
§ 150B-21.20. Codifier's authority to revise
form of rules.
(a) Authority. -- After consultmg with the
agency that adopted the rule, the Codifier of
Rules may revise the form of a rule submitted for
inclusion in the North Carolina Administrative
Code within 10 business days after the rule is
submitted to do one or more of the foUowing:
(1) Rearrange the order of the rule in the
Code or the order of the subsections, su-bdivisions,
or other subparts of the rule.
(2) Provide a catch line or heading for the rule
or revise the catch line or heading of the
rule.
(3) Reletter or renumber the rule or the sub-parts
of the rule in accordance with a
uniform svstem.
(4) Rearrange definitions and lists.
(5) Make other changes in arrangement or in
form that do not change the substance of
the rule and are necessary or desirable for
a clear and orderly arrangement of the
rule.
(b) Effect. -- Revision of a rule by the Codifier
of Rules under this section does not affect the
effective date of the rule or require the agency to
readopt or resubmit the rule. When the Codifier
of Rules revises the foim of a rule the Codifier
of Rules must send the agency that adopted the
rule a copy of the revised rule. The revised rule
is the official rule.
§ 150B-2I.21. Publication of rules of North
Carolina State Bar and exempt agencies.
(a) State Bar. — The North Carolina State Bar
must submit a rule adopted or approved by it
and entered in the minutes of the North Carolina
Supreme Court to the Codifier of Rules for
inclusion in the North Carolina Administrative
Code. The State Bar must submit a rule within
15 days after it is entered in the minutes of the
Supreme Court. The Codifier of Rules must
compile, make available for pubhc inspection,
and publish a rule included in the North Carolina
Administrative Code under this subsection in the
same manner as other rules in the Code.
(b) Exempt Agencies. -- Notwithstanding G.S.
150B-1, the North Carolina L'tifities Commis-sion
must submit to the Codifier of Rules those
rules of the Utilities Commission that are pub-lished
from time to time in the pubhcation titled
"North Carolina Utilities Laws and
Regulations." The Utihties Commission must
submit a rule required to be included in the Code
within 15 days after it is adopted. The Codifier
of Rules must pubhsh the rules submitted by the
Utilities Commission in the North Carolina Ad-ministrative
Code in the same format as they are
submitted.
Notwithstanding G.S. 150B-1, an agency other
than the Utihties Commission that is exempted
from this .Article by that statute must submit a
temporary or permanent rule adopted by it to the
Codilier of Rules for inclusion in the North
Carohna Administrative Code. One of these ex-empt
agencies must submit a rule to the Codifier
of Rules within 15 days after it adopts the rule.
The Codifier of Rules must compile, make
available for pubhc inspection, and pubhsh a rule
of one of these agencies in the North Carolina
Administrative Code in the same manner as
other rules in the Code.
§ 1508-21.22. Effect of inclusion in Code.
Official or judicial notice can be taken of a rule
in the North Carolina Administrative Code and
shall be taken when appropriate. Codification
6:li NORTH CAROLINA REGISTER September 30, 1 991 794
GENERAL STA TUTES OF NORTH CAROLINA
of a rule in the North Carolina Administrative
Code 15 prima facie evidence of compliance with
this .Article.
§ 150B-21.23. Rule publication manual.
Ihe Codifier of Rules must publish a manual
that sets out the form and method for publishing
a notice of rule making in the North Carolina
Register and for filing a rule in the North
Carolina Administrative Code.
§ I50B-21.24. Free copies of Register and
Code.
(a) Register. -- The Codifier of Rules must
distribute copies of the North Carolina Register
as soon after publication as practical, without
charge, to the following:
( 1
)
A person who receives a free copy of the
North Carolina Administrative Code,
(2) Upon request, one copy to each member
of the General Assembly,
(b) Code. -- The Codifier of Rules must dis-tribute
copies of the North Carolina Administra-tive
Code as soon after pubhcation as practical,
without charge, to the following:
(1) One copy to the board of commissioners
of each county, to be placed at the county
clerk of court's office or at another place
selected by the board of commissioners,
(2j One copy to the Commission.
(3) One copy to the Clerk of the Supreme
Court and to the Clerk of the Court of
Appeals of North Carolina,
(4) One copy to the Supreme Court Library^
and one copy to the library of the Court
of Appeals.
(5) One copy to the Admimstrative Office of
the Courts.
(6) One copy to the Govemor.
(7) Five copies to the Legislati\'e Services
Commission for the use of the General
Assembly.
(8) Upon request, one copy to each State of-ficial
or department to whom or to w hich
copies of the appellate division reports are
furnished under G.S. 7A-343,1,
(9) Fi\'e copies to the Division of State Li-brary,'
of the Department of Cultural Re-sources
pursuant to G.S. 125-11.7.
§ 150B-21.25. Paid copies of Register and
Code.
A person who is not entitled to a free copy of
the North Carolina Administrative Code or
North Carolina Register may obtain a copy by
paying a fee set by the Codifier of Rules. The
Coditier must set separate fees for the North
Carolina Register and the North Carolina Ad-ministrative
Code in amounts that cover publi-cation,
copying, and mailing costs, .AH monies
received under this section must be credited to
the General Fund,
Article 3.
.Administrative Hearings.
§ 1508-22. Settlement; contested case.
It is the policy of this State that any dispute
between an agency and another person that in-volves
the person's rights, duties, or privileges,
including licensing or the le\'y of a monetarv'
penalty, should be settled through informal pro-cedures.
In trying to reach a settlement through
informal procedures, the agency may not conduct
a proceeding at which sworn testimony is taken
and witnesses may be cross-examined. If the
agency and the other person do not agree to a
resolution of the dispute through informal pro-cedures,
either the agency or the person may
commence an administrative proceeding to de-termine
the persons rights, duties, or privileges,
at which time the dispute becomes a "contested
case,"
§ 150B-23. Commencement; assignment of
administrative law judge; hearing required; notice;
intenention.
(a) A contested case shall be commenced by
filing a petition with the Office of .Administrative
Heanngs and, except as provided in .Article 3A
of this Chapter, shall be conducted by that Of-fice,
The party who files the petition shall ser%'e
a copy of the petition on all other parties and, if
the dispute concerns a license, the person who
holds the license, A party who files a petition
shall file a certificate of service together with the
petition, A petition shall be signed by a party
or a representative of the party and, if filed by a
party other than an agency, shall state facts
tending to establish that the agency named as the
respondent has deprived the petitioner of prop-erty,
has ordered the petitioner to pay a fine or
ci\il penalty, or has otherwise substantially prej-udiced
the petitioner's nghts and that the agency:
(1) Exceeded its authority or jurisdiction;
(2) .Acted erroneously;
(3) Failed to use proper procedure:
(4) .Acted arbitrarily or capriciously: or
(5j Failed to act as required by law"^or rule.
The parties in a contested case shall be gi\en an
opportunity for a hearing without undue delay,
.Any person aggrie\ed may commence a con-tested
case hereunder,
A local goverimient employee, applicant for
employment, or former employee to whom
Chapter 126 of the General Statutes appHes may
commence a contested case under this .Article in
the same manner as any other petitioner. The
case shall be conducted in the Office of Admin-istrative
Hearings in the same manner as other
contested cases under this .Article, except that the
795 6:13 NORTH CAROLINA REGISTER September 30, 1991
GENERAL STA TUTES OF NORTH CAROLINA
decision of the State Personnel Commission shall
be advisor\' only and not binding on the local
appointing authority, unless (1) the employee,
apphcant, or former employee has been subjected
to discrimination prohibited by Article 6 of
Chapter 126 of the General Statutes or (2) ap-plicable
federal standards require a binding deci-sion.
In these two cases, the State Personnel
Commission's decision shall be binding.
(al) Repealed by Session Laws 1985 (Reg.
Sess., 1986), c. 1022, s. 1(9), effective July 15,
1986.
(a2) An administrative law judge assigned to a
contested case may require a party to the case to
file a prehearing statement. A party's prehearing
statement must be ser\'ed on all other parties to
the contested case.
(b) The parties to a contested case shall be
given a notice of hearing not less than 15 days
before the hearing by the Office of Administrative
Hearings. If prehearing statements have been
filed in the case, the notice shall state the date,
hour, and place of the hearing. If prehearing
statements have not been filed in the case, the
notice shall state the date, hour, place, and nature
of the hearing, shall list the particular sections of
the statutes and rules involved, and shall give a
short and plain statement of the factual
allegations.
(c) Notice shall be given personally or by cer-tified
mail. If given by certified mail, it shall be
deemed to have been given on the dchvery date
appearing on the return receipt. If giving of no-tice
cannot be accomplished cither personally or
by certified mail, notice shall then be given in the
manner provided in G.S. lA-1, Rule 4(jl).
(d) Any person may petition to become a party
by filing a motion to intervene in the manner
provided in G.S. lA-1, Rule 24. In addition, any
person interested in a contested case may inter-vene
and participate in that proceeding to the
extent deemed appropriate by the administrative
law judge.
(e) /Ml hearings under this Chapter shall be
open to the public. Hearings shall be conducted
in an impartial manner. Hearings shall be con-ducted
according to the procedures set out in this
Article, except to the extent and in the particulars
that specific hearing procedures and time stand-ards
are governed by another statute.
(f) Unless another statute or a federal statute
or regulation sets a time limitation for the filing
of a petition in contested cases against a specified
agency, the general Umitation for the filing of a
petition in a contested case is 60 days. The time
limitation, whether estabhshed by another stat-ute,
federal statute, or federal regulation, or this
section, shall commence when notice is given of
the agency decision to all persons aggrieved who
are known to the agency by personal delivery or
by the placing of the notice in an official deposi-tory
of the United States Postal Service wrapped
in a wrapper addressed to the person at the latest
address given by the person to the agency. The
notice shall be in writing, and shall set forth the
agency action, and shall inform the persons of the
right, the procedure, and the time limit to file a
contested case petition. When no informal
settlement request has been received by the
agency prior to issuance of the notice, any sub-sequent
informal settlement request shall not
suspend the time limitation for the fUing of a pe-tition
for a contested case hearing.
§ 150B-24. Venue of hearing.
(a) The hearing of a contested case shall be
conducted:
(1) In the county in this State in which any
person whose property or rights are the
subject matter of the hearing maintains
his residence;
(2) In the county where the agency maintains
its principal office if the property or rights
that are the subject matter of the hearing
do not affect any person or if the subject
matter of the hearing is the property or
rights of residents of more than one
county; or
(3) In any county determined by the admin-istrative
law judge in his discretion to
promote the ends of justice or better serve
the convenience of witnesses.
(b) Any person whose property or rights are
the subject matter of the hearing waives his ob-jection
to venue by proceeding in the hearing.
§ 150B-25. Conduct of hearing; answer.
(a) If a party fails to appear in a contested case
after proper service of notice, and if no
adjournment or continuance is granted, the ad-ministrative
law judge may proceed with the
hearing in the absence of the party.
(b) Repealed.
(c) The parties shall be given an opportunity
to present arguments on issues of law and poUcy
and an opportunity to present evidence on issues
of fact
.
(d) A party may cross-examine any witness,
including the author of a document prepared by,
on behalf of or for use of the agency and offered
in evidence. Any party may submit rebuttal ev-idence.
§ 150B-26. Consolidation.
When contested cases involving a common
question of law or fact or multiple proceedings
involving the same or related parties are pending,
the Director of the Office of Administrative
Hearings may order a joint hearing of any mat-
6:li NORTH CAROLINA REGISTER September 30, 1991 796
GENERAL STA TUTES OF NORTH CAROLINA
ters at issue in the cases, order the cases consol-idated,
or make other orders to reduce costs or
delay in the proceedings.
§ 1508-27. Subpoena.
After the commencement of a contested case,
subpoenas may be issued and served in accord-ance
with G.S. lA-1, Rule 45. In addition to the
methods of sen'ice in G.S. IA-1, Rule 45, a State
law enforcement officer may serve a subpoena
on behalf of an agency that is a party to the
contested case by any method by which a sheriff
may ser\e a subpoena under that Rule. Upon a
motion, the administrative law judge may quash
a subpoena if upon a hearing, the administrative
law judge fmds that the evidence the production
of which is required does not relate to a matter
in issue, the subpoena does not describe with
sufficient particularity the evidence the pro-duction
of which is required, or for any other
reason sufficient in law the subpoena may be
quashed. Witness fees shall be paid by the party
requesting the subpoena to subpoenaed witnesses
in accordance with G.S. 7A-314. However, State
officials or employees who are subpoenaed shall
not be entitled to witness fees, but they shall re-ceive
their normal salary and they shall not be
required to take any annual leave for the witness
days. Travel expenses of State officials or em-ployees
who are subpoenaed shall be reimbursed
as provided m G.S. 138-6.
§ 1 SOB- 28. Depositions and discoven'.
(a) A deposition may be used in lieu of other
evidence when taken in comphance with the
Rules of Civil Procedure, G.S. lA-1. Parties in
contested cases may engage in discovery pursuant
to the provisions of the Rules of Civil Procedure,
G.S. lA-1.
(b) On a request for identifiable agency records,
with respect to material facts involved in a con-tested
case, except records related solely to the
mtemal procedures of the agency or which are
exempt from disclosure by law, an agency shall
promptly make the records available to a party.
§ 150B-29. Rules of evidence.
(a) In all contested cases, irrelevant, immaterial
and unduly repetitious evidence shall be ex-cluded.
Except as otherwise provided, the rules
of evidence as applied in the trial division of the
General Court of Justice shall be followed; but,
when evidence is not reasonably available under
the rules to show relevant facts, then the most
reliable and substantial evidence available shall
be admitted. On the judge's own motion, an
administrative law judge may exclude evidence
that is inadmissible under this section. It shall
not be necessary for a party or his attorney to
object at the hearing to evidence in order to pre-ser\'
e the right to object to its consideration by
the administrative law judge in making a recom-mended
decision, by the agency in making a fmal
decision, or by the court on judicial review.
(b) Evidence in a contested case, including re-cords
and documents, shall be offered and made
a part of the record. Factual information or ev-idence
not made a part of the record shall not be
considered in the determination of the case, ex-cept
as permitted under G.S. 1508-30. Docu-mentary
evidence may be received in the form of
a copy or excerpt or may be incorporated by
reference, if the materials so incorporated are
available for examination by the parties. Upon
timely request, a party shall be given an oppor-tunity
to compare the copy with the original if
available.
§ 1508-30. Omcial notice.
Official notice may be taken of all facts of which
judicial notice may be taken and of other facts
within the specialized knowledge of the agency.
The noticed fact and its source shall be stated and
made known to affected parties at the earliest
practicable time, and any party shall on timely
request be afforded an opportunity to dispute the
noticed fact through submission of evidence and
argument.
§ 1508-31. Stipulations.
(a) The parties in a contested case may, by a
stipulation in writing filed with the administrative
law judge, agree upon any fact involved in the
controversy, which stipulation shall be used as
evidence at the hearing and be binding on the
parties thereto. Parties should agree upon facts
when practicable.
(b) Except as otherwise provided by law, dis-position
may be made of a contested case by
stipulation, agreed settlement, consent order,
waiver, default, or other method agreed upon by
the parties.
§ 1508-32. Designation of administrative law
judge.
(a) The Director of the Office of Administrative
Hearings shall assign himself or another admin-istrative
law judge to preside over a contested
case.
(b) On the filing in good faith by a party of a
timely and sufficient affidavit of personal bias or
disqualification of an administrative law judge,
the administrative law judge shall determine the
matter as a part of the record in the case, and this
determination shall be subject to judicial review
at the conclusion of the proceeding.
(c) WTien an administrative law judge is dis-qualified
or it is impracticable for him to con-tinue
the hearing, the Director shall assign
another administrative law judge to continue
with the case unless it is shown that substantial
prejudice to any party will result, in which event
797 6:13 NORTH CAROLINA REGISTER September 30, I99I
GENERAL STA TUTES OF NORTH CAROLINA
a new hearing shall be held or the case dismissed
without prejudice.
§ I50B-33. Powers of administrative law
judge.
(a) An administrative law judge shall stay any
contested case under this Article on motion of
an agency which is a party to the contested case,
if the agency shows by supporting cdTidavits that
it is engaged in other litigation or administrative
proceedings, by whatever name called, with or
before a federal agency, and this other litigation
or administrative proceedings will determine the
position, in whole or in part, of the agency in the
contested case. At the conclusion of the other
litigation or administrative proceedings, the con-tested
case shall proceed and be determined as
expeditiously as possible.
(b) An administrative law judge may:
(1) Administer oaths and affumations;
(2) Sign, issue, and rule on subpoenas in ac-cordance
with G.S. 150B-27 and G.S.
lA-1, Rule 45;
(3) Provide for the taking of testimony by
deposition and rule on all objections to
discovery in accordance with G.S. lA-1,
the Rules of Civil Procedure;
(3a) Rule on all prehearing motions that are
authorized by G.S. lA-1, the Rules of
Civd Procedure;
(4) Regulate the course of the hearings, in-cluding
discovery, set the time and place
for continued hearings, and fix the time
for filing of briefs and other documents;
(5) Direct the parties to appear and confer to
consider simplification of the issues by
consent of the parties;
(6) Stay the contested action by the agency
pending the outcome of the case, upon
such terms as he deems proper, and sub-ject
to the provisions of G.S. lA-1, Rule
65;
(7) Determine whether the hearing shaU be
recorded by a stenographer or by an elec-tronic
device; and
(8) Enter an order returnable in the General
Court of Justice, Superior Court Division,
to show cause why the person should not
be held in contempt. The Court shall
have the power to impose punishment as
for contempt for any act which would
constitute direct or indirect contempt if
the act occurred in an action pending in
Superior Court.
(9) Determine that a rule as apphed in a
particular case is void because (1) it is not
within the statutory authority of the
agency, (2) is not clear and unambiguous
to persons it is intended to direct, guide.
or assist, or (3) is not reasonably necessary
to enable the agency to fulfill a duty de-legated
to it by the General Assembly.
(10) Impose the sanctions provided for in G.S.
1A- 1 or Chapter 3 of Title 26 of the North
Carolina Administrative Code for non-comphance
with applicable procedural
rules.
§ 150B-34. Recommended decision or order
of administrative law judge.
(a) Except as provided in G.S. 150B-36(c), in
each contested case the administrative law judge
shall make a recommended decision or order that
contains fmdings of fact and conclusions of law.
(b) Repealed.
§ 1 SOB- 35. No ex parte communication; ex-ceptions.
Unless required for disposition of an ex parte
matter authorized by law, neither the adminis-trative
law judge assigned to a contested case nor
a member or employee of the agency making a
fmal decision in the case may communicate, di-rectly
or indirectly, in cormection with any issue
of fact, or question of law, with any person or
party or his representative, except on notice and
opportunity for all parties to participate.
§ 1 SOB- 36. Final decision.
(a) Before the agency makes a fmal decision, it
shall give each party an opportunity to fde ex-ceptions
to the decision recommended by the
administrative law judge, and to present written
arguments to those in the agency who will make
the final decision or order. If a party files in good
faith a timely and sufficient affidavit of personal
bias or other reason for disqualification of a
member of the agency making the fmal decision,
the agency shall determine the matter as a part
of the record in the case, and the determination
is subject to judicial review at the conclusion of
the case.
(b) A fmal decision or order in a contested case
shall be made by the agency in writing after re-view
of the official record as defmed in G.S.
150B-37(a) and shall include fmdings of fact and
conclusions of law. If the agency does not adopt
the administrative law judge's recommended de-cision
as its fmal decision, the agency shall state
in its decision or order the specific reasons why
it did not adopt the administrative law judge's
recorTm:iended decision. The agency may con-sider
only the official record prepared pursuant
to G.S. 150B-37 in making a fmal decision or
order, and the final decision or order shall be
supported by substantial evidence admissible un-der
G.S. 150B-29(a), 150B-30, or 150B-31. A
copy of the decision or order shall be served
upon each party personally or by certified mail
addressed to the party at the latest address given
6:13 NORTH CAROLINA REGISTER September 30, 1991 798
GENERAL STA TUTES OF NORTH CAROLINA
by the party to the agency, and a copy shall be
furnished to his attorney of record and the Office
of Administrative Hearings.
(c) 1 he following decisions made by adminis-trative
law judges in contested cases are fmal de-cisions:
(1) A determination that the Office of Ad-ministrative
Hearings lacks junsdiction.
(2) An order entered pursuant to the authority
in G.S. 7A-759(e).
(3) An order entered pursuant to a written
prehearing motion that either dismisses
the contested case for failure of the
petitioner to prosecute or grants the rehef
requested when a party does not comply
with procedural requirements.
(4) An order entered pursuant to a prehearing
motion to dismiss the contested case in
accordance with G.S. lA-1, Rule 12(b)
v\hen the order disposes of all issues in the
contested case.
§ 15(»B-37. Omcial record.
(a) In a contested case, the Office of Adminis-trative
Hearings shall prepare an official record
of the case that includes:
(1) Notices, pleadings, motions, and interme-diate
rulings;
(2) Questions and offers of proof, objections,
and rulings thereon;
(3) Evidence presented;
(4) Matters officially noticed, except matters
so obvious that a statement of them
would serve no useful purpose; and
(5) The administrative law judge's recom-mended
decision or order.
(b) Proceedings at which oral evidence is pre-sented
shall be recorded, but need not be tran-scribed
unless requested by a party. Each party
shall bear the cost of the transcript or part thereof
or copy of said transcript or part thereof which
said party requests, and said transcript or part
thereof shall be added to the official record as an
exhibit.
(c) The Office of Administrative Hearings shall
forward a copy of the official record to the agency
making the final decision and shall forward a
copy of the recommended decision to each party.
Article 3A.
Other Administrative Hearings.
§ I50B-38. Scope; required; notice; venue.
(a) The provisions of this Article shall apply to
the following agencies:
(1) Occupational licensing agencies;
(2) The State B;mking Commission, the
Commissioner of Banks, the Savings In-stitutions
Division of the Department of
Economic and Community Development,
and the Credit Union Division of the De-partment
of Economic and Community
Development; and
(3) The Department of Insurance and the
Commissioner of Insurance.
(b) Prior to any agency action in a contested
case, the agency shall give the parties in the case
an opportunity for a hearing without undue delay
and notice not less than 15 days before the hear-ing.
Notice to the parties shall include:
(1) A statement of the date, hour, place, and
nature of the hearing;
(2) A reference to the particular sections of the
statutes and rules involved; and
(3) A short and plain statement of the facts
alleged.
(c) Notice shall be given personally or by cer-tified
mail. If given by certified mail, notice shall
be deemed to have been given on the delivery
date appearing on the return receipt. If notice
cannot be given personally or by certified mail,
then notice shall be given in the manner provided
in G.S. lA-1, Rule4(jr).
(d) A party who has been served with a notice
of hearing may file a written response with the
agency. If a written response is filed, a copy of
the response must be mailed to all other parties
not less than 10 days before the date set for the
hearing.
(e) /Ml hearings conducted under this /Vrticle
shall be open to the public. A hearing conducted
by the agency shall be held in the county where
the agency maintains its principal office. A
hearing conducted for the agency by an adminis-trative
law judge requested under G.S. 150B-40
shall be held in a county in this State where any
person whose property or rights are the subject
matter of the hearing resides. If a different venue
would promote the ends of justice or better serve
the convenience of witnesses, the agency or the
administrative law judge may designate another
county. A person whose property or rights are
the subject matter of the hearing waives his ob-jection
to venue if he proceeds in the hearing.
(f) Any person may petition to become a party
by filing with the agency or hearing officer a
motion to intervene in the manner provided by
G.S. lA-1, Rule 24. In addition, any person in-terested
in a contested case under this Article
may intervene and participate to the extent
deemed appropriate by the agency hearing offi-cer.
(g) When contested cases involving a common
question of law or fact or multiple proceedings
involving the saine or related parties are pending
before an agency, the agency may order a joint
hearing of any matters at issue in the cases, order
the cases consolidated, or m;ike other orders to
reduce costs or delay in the proceedings.
799 6:13 NORTH CAROLINA REGISTER September 30, 1991
GENERAL STA TUTES OF NORTH CAROLINA
(h) Every agency shall adopt rules governing
the conduct of hearings that are consistent with
the provisions of this Article.
§ 1 SOB- 39. Depositions; discovery; subpoenas.
(a) A deposition may be used in lieu of other
evidence when taken in compliance with the
Rules of Civil Procedure, G.S. lA-1. Parties in
a contested case may engage in discovery pursu-ant
to the provisions of the Rules of Civil Pro-cedure,
G.S. lA-1.
(b) Upon a request for an identifiable agency
record involving a material fact in a contested
case, the agency shall promptly provide the re-cord
to a party, unless the record relates solely to
the agency's internal procedures or is exempt
from disclosure by law.
(c) In preparation for, or in the conduct of, a
contested case subpoenas may be issued and
served in accordance with G.S. lA-1, Rule 45.
Upon a motion, the agency may quash a
subpoena if, upon a hearing, the agency finds
that the evidence, the production of which is re-quired,
does not relate to a matter in issue, the
subpoena does not describe with sufficient
particularity the evidence the production of
which is required, or for any other reason suffi-cient
in law the subpoena may be quashed.
Witness fees shall be paid by the party requesting
the subpoena to subpoenaed witnesses in ac-cordance
with G.S. 7A-314. However, State of-ficials
or employees who are subpoenaed shall
not be entitled to any witness fees, but they shall
receive their normal salary' and they shall not be
required to take any annual leave for the witness
days. Travel expenses of State officials or em-ployees
who are subpoenaed shall be reimbursed
as provided in G.S. 138-6.
§ 150B-40. Conduct of hearing; presiding of-ficer;
ex parte communication.
(a) Hearings shall be conducted in a fair and
impartial manner. At the hearing, the agency
and the parties shall be given an opportunity to
present evidence on issues of fact, examine and
cross-examine witnesses, including the author of
a document prepared by, on behalf of or for the
use of the agency and offered into evidence, sub-mit
rebuttal evidence, and present arguments on
issues of law or pohcy.
If a party fails to appear in a contested case after
he has been given proper notice, the agency may
continue the hearing or proceed with the hearing
and make its decision in the absence of the party.
(b) Except as provided under subsection (e) of
this section, hearings under this Article shall be
conducted by a majority of the agency. An
agency shall designate one or more of its mem-bers
to preside at the hearing. If a party files in
good faith a timely and sufficient affidavit of the
personal bias or other reason for disqualification
of any member of the agency, the agency shall
determine the matter as a part of the record in the
case, and its determination shall be subject to
judicial review at the conclusion of the proceed-ing.
If a presiding officer is disqualified or it is
impracticable for him to continue the hearing,
another presiding officer shall be assigned to
continue with the case, except that if assignment
of a new presiding officer will cause substantial
prejudice to any party, a new hearing shall be
held or the case dismissed without prejudice.
(c) The presiding officer may:
(1) Administer oaths and affirmations;
(2) Sign and issue subpoenas in the name of
the agency, requiring attendance and giv-ing
of testimony by witnesses and the
production of books, papers, and other
documentary evidence;
(3) Provide for the taking of testimony by
deposition;
(4) Regulate the course of the hearings, set the
time and place for continued hearings, and
fix the time for filing of briefs and other
documents;
(5) Direct the parties to appear and confer to
consider simplification of the issues by
consent of the parties; and
(6) Apply to any judge of the superior court
resident in the district or presiding at a
term of court in the county where a hear-ing
is pending for an order to show cause
why any person should not be held in
contempt of the agency and its processes,
and the court shall have the power to im-pose
punishment as for contempt for acts
which would constitute direct or indirect
contempt if the acts occurred in an action
pending in superior court.
(d) Unless required for disposition of an ex
parte matter authorized by law, a member of an
agency assigned to make a decision or to make
fmdings of fact and conclusions of law in a con-tested
case under this Article shall not commu-nicate,
directly or indirectly, in connection with
any issue of fact or question of law, with any
person or party or his representative, except on
notice and opportunity for all parties to partic-ipate.
Ihis prohibition begins at the time of the
notice of hearing. An agency member may
communicate with other members of the agency
and may have the aid and advice of the agency
staff other than the staff which has been or is
engaged in investigating or prosecuting functions
in connection with the case under consideration
or a factually-related case. This section does not
apply to an agency employee or party represen-tative
with professional training in accounting.
6:13 NORTH CAROLINA REGISTER September 30. 1 99
1
800
GENERAL STA TUTES OF NORTH CAROLINA
actuarial science, economics or financial analysis
insofar as the case involves financial practices or
conditions.
(e) WTien a majority of an agency is unable or
elects not to hear a contested case, the agency
shall apply to the Director of the Office of Ad-ministrative
Hearings for the designation of an
administrative law judge to preside at the hearing
of a contested case under this ^Vrticle. Upon re-ceipt
of the application, the Director shall, with-out
undue delay, assign an administrative law-judge
to hear the case.
The provisions of this Article, rather than the
provisions of Article 3, shall govern a contested
case in which the agency requests an administra-tive
law judge from the Office of Administrative
Hearings.
The administrative law judge assigned to hear a
contested case under this .Article shall sit in place
of the agency and shall have the authority of the
presiding officer in a contested case under this
.Article. The administrative law judge shall make
a proposal for decision, which shall contain pro-posed
fmdings of fact and proposed conclusions
of law.
An administrative law judge shall stay any con-tested
case under this Article on motion of an
agency which is a party to the contested case, if
the agency shows by supporting affidavits that it
is engaged in other htigation or administrati\e
proceedings, by whatever name called, with or
before a federal agency, and this other litigation
or administrative proceedings will determine the
position, in whole or in part, of the agency in the
contested case. At the conclusion of the other
litigation or administrative proceedings, the con-tested
case shall proceed and be determined as
expeditiously as possible.
The agency may make its fmal decision only
after the administrative law judge's proposal for
decision is sened on the parties, and an oppor-tunity
is given to each party to file exceptions and
proposed fmdings of fact and to present oral and
written arguments to the agency.
§ 150B-41. Evidence; stipulations; official no-tice.
(a) In all contested cases, irrelevant, immaterial,
and unduly repetitious e\'idence shall be ex-cluded.
Except as otherwise provided, the rules
of evidence as applied in the trial division of the
General Court of Justice shall be followed; but,
when evidence is not reasonably available under
such rules to show rele\ant facts, they may be
shown by the most reliable and substantial evi-dence
available. It shall not be necessary for a
party or his attorney to object to evidence at the
hearing in order to preser\'e the right to object to
its consideration by the agency in reaching its
decision, or by the court of judicial review.
(b) Evidence in a contested case, including re-cords
and documents shall be offered and made
a part of the record. Other factual information
or e\idence shall not be considered in determi-nation
of the case, except as permitted under
G.S. 150B-30. Documentary evidence may be
received in the form of a copy or excerpt or may
be incorporated by reference, if the materials so
incorporated are available for examination by the
parties. Upon timely request, a party shall be
given an opportunity to compare the copy with
the original if available.
(c) The parties in a contested case under this
Article by a stipulation in writing fded with the
agency may agree upon any fact involved in the
controversy, which stipulation shall be used as
evidence at the hearing and be binding on the
parties thereto. Parties should agree upon facts
when practicable. Except as otherwise provided
by law, disposition may be made of a contested
case by stipulation, agreed settlement, consent
order, waiver, default, or other method agreed
upon by the parties.
(d) Official notice may be taken of all facts of
which judicial notice may be taken and of other
facts within the specialized knowledge of the
agency. The noticed fact and its source shall be
stated and made known to affected parties at the
earliest practicable time, and any party shall on
timely request be afforded an opportunity to dis-pute
the noticed fact through submission of evi-dence
and argument. An agency may use its
experience, technical competence, and specialized
knowledge in the evaluation of evidence pre-sented
to it.
§ I50B-42. Final agency decision; official re-cord.
(a) After compliance with the provisions of
G.S. 150B-40(e), if applicable, and review of the
official record, as defmed in subsection (b) of this
section, an agency shall make a written fmal de-cision
or order in a contested case. The decision
or order shall include fmdings of fact and con-clusions
of law. Findings of fact shall be based
exclusively on the evidence and on matters offi-cially
noticed. Findings of fact, if set forth in
statutory language, shall be accompanied by a
concise and explicit statement of the underlying
facts supporting them. A decision or order shall
not be made except upon consideration of the
record as a whole or such portion thereof as may
be cited by any party to the proceeding and shall
be supported by substantial e\ idence admissible
under G.S. I50B-41. A copy of the decision or
order shall be sened upon each party personally
or by certified mail addressed to the party at the
SOI 6:13 NORTH CAROLINA REGISTER September 30, I99I
GENERAL STA TUTES OF NORTH CAROLINA
latest address given by the party to the agency
and a copy shall be furnished to his attorney of
record.
(b) An agency shall prepare an official record
of a hearing that shall include:
(1) Notices, pleadings, motions, and interme-diate
rulings;
(2) Questions and offers of proof, objections,
and rulings thereon;
(3) Evidence presented;
(4) Matters officially noticed, except matters
so obvious that a statement of them
would serve no useful purpose;
(5) Proposed fmdings and exceptions; and
(6) Any decision, opinion, order, or report by
the officer presiding at the hearing and by
the agency.
(c) Proceedings at which oral evidence is pre-sented
shall be recorded, but need not be tran-scribed
unless requested by a party. Each party
shall bear the cost of the transcript or part thereof
or copy of said transcript or part thereof which
said party requests.
Article 4.
Judicial Review.
§ 150B-43. Right to judicial review.
Any person who is aggrieved by the fmal deci-sion
in a contested case, and who has exhausted
all administrative remedies made available to him
by statute or agency rule, is entitled to judicial
review of the decision under this /Vrticle, unless
adequate procedure for judicial review is pro-vided
by another statute, in which case the review
shall be under such other statute. Nothing in this
Chapter shall prevent any person from invoking
any judicial remedy available to him under the
law to test the vahdity of any administrative
action not made reviewable under this Article.
§ 150B-44. Right to judicialintervention when
decision unreasonably delayed.
Unreasonable delay on the part of any agency
or administrative law judge in taking any required
action shall be justification for any person whose
rights, duties, or privileges are adversely affected
by such delay to seek a court order compelling
action by the agency or administrative law judge.
An agency that is subject to .Article 3 of this
Chapter and is not a board or commission has
90 days from the day it receives the official record
in a contested case from the Office of Adminis-trative
Hearings to make a fmal decision in the
case. This time limit may be extended by the
parties or, for good cause shown, by the agency
for an additional period of up to 90 days. An
agency that is subject to Article 3 of this Chapter
and is a board or commission has 90 days from
the day it receives the official record in a con-tested
case from the Office of Administrative
Hearings or 90 days after its next regularly
scheduled meeting, whichever is longer, to make
a final decision in the case. This time limit may
be extended by the parties or, for good cause
shown, by the agency for an additional period of
up to 90 days. If an agency subject to Article 3
of this Chapter has not made a fmal decision
within these time limits, the agency is considered
to have adopted the administrative law judge's
recommended decision as the agency's fmal deci-sion.
Failure of an agency subject to Article 3A
of this Chapter to make a fmal decision within
180 days of the close of the contested case hear-ing
is justification for a person whose rights, du-ties,
or privileges are adversely affected by the
delay to seek a court order compelling action by
the agency or, if the case was heard by an ad-ministrative
law judge, by the administrative law
judge.
§ 150B-45. Procetlure for seeking review;
waiver.
To obtain judicial review of a fmal decision un-der
this Article, the party seeking review must fde
a petition in the Superior Court of Wake County
or in the superior court of the county where the
person resides.
The person seeking review must file the petition
within 30 days after the person is served with a
written copy of the decision. A person who fails
to fde a petition within the required time waives
the right to judicial review under this /Vrticle.
For good cause shown, however, the superior
court may accept an untimely petition.
§ 150B-46. Contents of petition; copies ser\ed
on all parties; intervention.
The petition shall exphcitly state what ex-ceptions
are taken to the decision or procedure
and what relief the petitioner seeks. Within 10
days after the petition is filed with the court, the
party seeking the review shall serve copies of the
petition by personal service or by certified mail
upon all who were parties of record to the ad-ministrative
proceedings. Names and addresses
of such parties shall be furnished to the petitioner
by the agency upon request. Any party to the
administrative proceeding is a party to the review
proceedings unless the party withdraws by noti-fying
the court of the withdrawal and serving the
other parties with notice of the withdrawal.
Other parties to the proceeding may file a re-sponse
to the petition within 30 days of service.
Parties, including agencies, may state exceptions
to the decision or procedure and what rehef is
sought in the response.
Any person aggrieved may petition to become
a party by filing a motion to inter\'ene as pro-vided
m G.S. lA-1, Rule 24.
6:13 NORTH CAROLINA REGISTER September 30, I99I S02
GESERAL STATUTES OE NORTH CAROLINA
§ 150B-47. Records filed with clerk of superior
court; contents of records; costs.
Within 30 days after receipt of the copy of the
petition for review, or within such additional
time as the court may allow, the agency that
made the fmal decision in the contested case shall
transmit to the reviewing court the original or a
certified copy of the official record m the con-tested
case under review together with: (ij any
exceptions, proposed fmdings of fact, or written
arguments submitted to the agency in accordance
with G.S. 150B-36(aj; and (ii) the agency's fmal
decision or order. With the permission of the
court, the record may be shortened by stipulation
of all parties to the re\iew proceedings. Any
party unreasonably refusing to stipulate to limit
the record may be taxed by the court for such
additional costs as may be occasioned by the re-fusal.
The court may require or permit subse-quent
corrections or additions to the record when
deemed desirable.
§ 150B-48. Stay of decision.
At any time before or during the review pro-ceeding,
the person aggrieved may apply to the
reviewing court for an order staying the operation
of the administrative decision pending the out-come
of the review. The court may grant or
deny the stay in its discretion upon such terms
as it deems proper and subject to the provisions
of G.S. lA-1, Rule 65.
§ 150B-49. New evidence.
.-Vn aggrieved person who files a petition in the
superior court may apply to the court to present
additional evidence. If the court is satisfied that
the evidence is material to the issues, is not
merely cumulative, and could not reasonably
have been presented at the administrative hear-ing,
the court may remand the case so that addi-tional
evidence can be taken. If an administrative
law judge did not make a recommended decision
in the case, the court shall remand the case to the
agency that conducted the admimstrative hearing.
After hearing the evidence, the agency may affirm
or modify its previous fmdings of fact and fmal
decision. If an administrative law judge made a
recommended decision in the case, the court shall
remand the case to the administrative law judge.
.\fter hearing the evidence, the administrative law
judge may affirm or modify his pre\ious fmdings
of fact and recommended decision. The admin-istrative
law judge shall forward a copy of his
decision to the agency that made the fmal deci-sion,
which in turn may affum or modify its
previous findings of fact and fmal decision. The
additional evidence and any affirmation or mod-ification
of a recommended decision or fmal de-cision
shall be made part of the official record.
§ 1508-50. Review by superior court without
The review by a superior court of agency deci-sions
under this Chapter shall be conducted by
the court without a jury.
§ 1508-51. Scope of review.
(aj Imtial Determination in Certain Cases. In
reviewing a fmal decision in a contested case in
which an administrative law judge made a re-commended
decision, the court shall make two
initial determinations. First, the court shall de-termine
whether the agency heard new evidence
after receiving the recommended decision. If the
court determines that the agency heard new evi-dence,
the court shall reverse the decision or re-mand
the case to the agency to enter a decision
in accordance with the evidence in the official
record. Second, if the agency did not adopt the
recommended decision, the court shall determine
whether the agency's decision states the specific
reasons why the agency did not adopt the re-commended
decision. If the court determines
that the agency did not state specific reasons why
it did not adopt a recommended decision, the
court shall reverse the decision or remand the
case to the agency to enter the specific reasons.
(b) Standard of Review. After making the de-termmations,
if any, required by subsection (a),
the court re\iewing a final decision may affirm
the decision of the agency or remand the case for
further proceedings. It may also reverse or
modify the agency's decision if the substantial
rights of the petitioners may have been preju-diced
because the agency's findings, inferences,
conclusions, or decisions are:
(1) In violation of constitutional provisions;
(2) In excess of the statutory authority or ju-nsdiction
of the agency:
(3) Made upon unlawful procedure:
(4) .'VtTected by other error of law;
(5) Unsupported bv substantial evidence ad-missible
under G.S. 150B-29(a), 1508-30,
or 150B-31 in view of the entire record as
submitted: or
(6) .\rbitrar\" or capricious.
§ 1508-52. .Appeal; stay of court's decision.
A party to a review proceeding in a superior
court may appeal to the appellate di\'ision from
the final judgment of the superior court as pro-vided
in G.S. 7A-27. Pendmg the outcome of
an appeal, an appealing party may apply to the
court that issued the judgment under appeal for
a stay of that judgment or a stay of the adminis-trative
decision that is the subject of the appeal,
as appropriate.
rVrticle 5.
Publication of Administrative Rules.
Repealed.
803 6:B NORTH CAROLINA REGISTER September 30, 1991
EXECUTIVE ORDERS
EXECUTIVE ORDER NUMBER 149
RESCISSION OF EXECUTIVE ORDER
NUMBER 79 WHICH ESTABLISHED
THE NORTH CAROLINA SMALL
BUSINESS COUNCIL
By the authority vested in me as Governor by
the Constitution and laws of North Carolina, IT
IS ORDERED:
Executive Order Number 79 establishing the
North Carolina Small Business Council is hereby
rescinded.
Done this the 15th day of August, 1991.
EXECUTIVE ORDER NUMBER 150
NORTH CAROLINA HUM.\N SERVICE TRANS-PORTATION
COUNCIL
WHEREAS, the North Carolina Departments
of Transportation, Human Resources, and Eco-nomic
and Community Development administer
State and Eederal funding programs which may
be used by local human service agencies to pro-vide
necessary client transportation services; and
WHEREAS, the administrative pohcies and
procedures of these departments greatly affect
vehicle usage and the provision of transportation
services at the local level; and
WHEREAS, the Interagency Transportation
Review Committee was established in 1978 to
review the transportation components of all ap-plications
or plans requesting transportation
funding when the funds are administered by a
State department or agency; and
WHEREAS, the Interagency Transportation
Review Committee process has led to a much
more coordinated and cost effective use of trans-portation
resources, both capital and operating,
by local human service transportation providers;
and
WHEREAS, the General Assembly has appro-priated
funds for the Elderly and Handicapped
Transportation Assistance Program based on the
assurance of cost-effectiveness provided by im-plementation
of the local Transportation Devel-opment
Plan; and
WHEREAS, Title XIX Medicaid transporta-tion
funds are to be expended in a manner con-sistent
with the local Transportation
Development Plan; and
WHEREAS, there is a need for a statement of
policy on coordination of transportation re-sources
and these State departments and agencies
are in a position to facilitate the more efficient
use of these resources.
THEREFORE, pursuant to the authority
vested in me as Governor by the Constitution
and laws of this State IT IS ORDERED:
Section 1. POLICY
That, wherever practical, existing transportation
resources, public and private, should be utUized
before any new resources wiU be made available
through public funds;
That the locally prepared and adopted Trans-portation
Development Plan shall continue to
be the means by which to determine the most
cost effective and efficient use of transportation
resources; and
That the Department of Transportation shall
provide, to the extent that funds are available and
equipment is used consistent with the local
Transportation Development Plan, capital
equipment for the provision of local human ser-vice
transportation while the transportation funds
from other departments are used primarily for
operating assistance.
Section 2. ESTABLISHMENT
(1) There is hereby created the North Carolina
Human Service Transportation Council.
The Council wiU be composed of represen-tatives
from the North Carolina Depart-ments
of Transportation, Human
Resources, and Economic and Community
Development. The Secretaries of the re-spective
departments shall determine those
divisions to be represented on the Council.
Representation should include all divisions
which administer federal and state funds
used to provide human service transporta-tion
at the local level. Division directors
will be responsible for selecting a staff per-son
as the division's council representative.
Council appointees should be in policy
making positions and have authority over
subrecipient budget review and approval.
(2) Departments, agencies or programs which
are outside the jurisdiction of the Executive
Order are encouraged to join the Council
and agree to adopt the policies, procedures
and decisions of the Council.
(3) The State departments shall cooperate in
the formation, follow the policies, proce-dures
and decisions of, and support the Hu-man
Service Transportation Council as
described herein. Council representatives
6: 13 NOR TH CA ROLINA REGIS TER September 30, 1 991 S04
EXECUTIVE ORDERS
shall assist the Department of Transporta-tion
in encouraging local agencies to partic-ipate
in transportation development
planning efforts and in subsequent plan im-plementation,
and to operate vehicles in a
manner consistent with the local plan.
(4) The Director of the Public Transportation
and Rail Division shall chair the Council.
Section 1 DUTIES OF COUNCIL
The Council shall have the following duties:
(1) to implement poUcy and apply criteria as
developed by the Council;
(2) to provide written notice of recommen-dations
based upon review of applications
or plans to the appropriate State agency;
(3) to review the transportation components
of all applications or plaits requesting trans-portation
funding when funds are adminis-tered
by a member agency;
(4) to provide approval for the purchase of all
human ser\'ice transportation vehicles fi-nanced
by State administered programs; and
(5) to advise and make recommendations to the
Department of Transportation concerning
human service transportation policy.
Section 4, ADMINISTRATION
The Department of Transportation - Public
Transportation & Rail Di\ision shall provide the
administrative support for the Council.
Section 5, TRANSPORTATION FUNDING
DECISIONS
In case of disputes, the local and/or State agency
shall ha\-e the opportunity to address the Coun-cil.
When the Council decision is appealed or
when the Council caimot reach consensus, the
Secretary of the Department of Transportation,
after conferring with the appropriate Department
Secretary, shall have authority on all transporta-tion
funding decisions under the jurisdiction of
the Council.
Section 6, AGENCY RESPONSIBILITIES
(1) To further the objectives of the Executive
Order, ajj departments and agencies under
the Executive Order shall immediately draft
directives and procedures necessary to im-plement
these policies. Such drafts shall be
submitted to the Secretary of Transportation
for review and approval within 60 days of
the signing of this Executive Order. PubUc
Transportation & Rail Division staff assist-ance
shall be made available as necessary.
(2) There shall he a signed statement of policy
for each agency under the jurisdiction of this
Executive Order. The statement should be
signed by the respective Department Secre-tary
and each of the division directors within
the department that come under the juris-diction
of this Executive Order. The state-ment
wiU address the agency's commitment
to the objectives of this Executive Order and
the policies and procedures of the Council.
Section r EFFECTIVE DATE
This order shall be effective immediately and
shall remain in effect until July 1, 1993.
Done in the Capital City of Raleigh, North
Carolina this the 21st day of August, 1991.
805 6:13 NORTH CAROLINA REGISTER September 30, 1991
VOTING RIGHTS ACT FINAL DECISION LETTER
[G.S. 120-30.9H, effective July 16, 1986, requires that all letters and other documents issued by the
Attorney General of the United States in which a final decision is made concerning a "change af-fecting
voting" under Section 5 of the Voting Rights Act of 1965 be published in the North Carolina
Register. J
U.S. Department of Justice
Civil Rights Division
JRD:MAP:SAL:lrj
DJ 166-012-3 Voting Section
91-2474 P.O. Box 66128
Washington, D.C. 20035-6128
September 12, 1991
Michael CroweU, Esq.
Thanington, Smith & Hargrove
P. O. Box 1151
Raleigh, North Carolina 27602
Dear Mr. CroweU:
This refers to the adoption of a limited voting system with seven commissioners elected to four
year, staggered terms, with a plurality-win requirement in the primary, and the implementation schedule
for the board of commissioners in Beaufort County, North Carolina, submitted to the Attorney Gen-eral
pursuant to Section 5 of the Voting Rights Act of 1965, as amended, 42 U.S.C. 1973c. We received
your submission on July 15, 1991.
The Attorney General does not interpose any objection to the specified changes. However, we
note that Section 5 expressly provides that the failure of the Attorney General to object does not bar
subsequent litigation to enjoin the enforcement of the changes. See the Procedures for the Adminis-tration
of Section 5 (28 C.F.R. 51.41).
Sincerely,
John R. Durme
Assistant Attorney General
Civil Rights Division
By:
Gerald W. Jones
Chief, Voting Section
6.13 NORTH CAROLINA REGISTER September 30. I99I 806
PROPOSED RULES
TITLE 10 - DEPARTMENT OF HL^SIAN
RESOURCES
A^.otice is hereby given in accordance with G.S.
ISOB- 12 that the Department of Human
Resources Division of Medical Assistance intends
to amend rule(s) cited as 10 SCAC 26D .0016;
26H .0107, ,0508: and adopt rule(s) cited as 10
NCAC 26H .0209.
J he proposed effective date of this action is
February 1, 1992.
1 he public hearing will be conducted at 1:30
p.m. on October 31, 1991 at the Sorth Carolina
Division of Medical Assistance, 1985 Lmstead
Drive, Room 201. Raleigh, .V.C. 27603.
c-omment Procedures: Written comments con-cerning
these rules must be submitted by October
31, 1991, to: Division of .Medical .Assistance,
1985 Umstead Drive, Raleigh, .\.C. 27603,
ATTN.: Bill Hottel, APA Coordinator. Oral
comments may be presented at the hearing. In
addition, a fiscal impact statement is available
upon written request from the same address.
Editor's Sote: 10 SCAC 26H .0107, .0209 and
.0508 have been filed as temporary rules effective
August 1, 1991 for a period of 180 days to expire
on January 31, 1992.
10 SCAC 26D .0016 has been filed as a tempo-rary
rule effective August 15, 1991 for a period of
180 days to expire on February 15, 1992.
CHAPTER 26 - MEDICAL ASSISTANCE
SUBCHAPTER 26D - LIMITATIONS ON
AMOUNT: DLRATION: AND SCOPE
.0016 CO-PAVMENT
(a) Co-payment Requirements. The following
requirements are imposed on all Medicaid recip-ients
for the following ser\-ices:
(1) Outpatient Hospital Services. Co-payment
will be charged at the rate of one
dollar ($1.00) per outpatient visit.
(2) Chiropractic Services. Co-payment will
be charged at the rate of fifty cents ($.50)
per chiropractic visit.
(3) Pediatric Services. Co-payment wlU be
charged at the rate of one dollar ($1.00)
per podiatric visit.
(4) Optometric Services. Co-payment will
be charged at the rate of one doUar ($1.00)
per optometric visit.
(5) Optical Supplies and Ser\'ices. Co-payment
will be charged at the rate of two
dollars ($2.00) per item. Co-payment for
repair of eyeglasses and other optical sup-plies
will be charged at the rate of two
dollars ($2.00) per repair exceeding five
doUars ($5.00).
(6) Prescribed Drugs. Co paym^ant Vr^ii fee
chargod at tfee Fate &f Effective August 15,
1991, the recipient co-pavment amount
for prescription drugs will increase from
fifty cents ($.50) per prescription to one
doUar (SI. 00) per prescription including
refdls.
(7) Dental Services. Co-payment wiU be
charged at the rate of two dollars ($2.00)
per visit, except when more than one visit
is required. If more than one visit is re-quired
but the service is billed under one
procedure code with one date of service,
then only one co-payment shall be col-lected.
FuU and partial dentures are ex-amples.
(8) Physicians. Co payment wiH- fee chargod
at- tfee Fate »f Effective .August 15. 1991.
the recipient co-pavment amount for a
phvsician visit will increase from frfty
cents ($.50) per visit to two dollars ($2.00)
per visit.
(9) Hospital Inpatient Services. No co-payment
win be charged for hospital in-patient
services.
(10) Rural Health Clinics. No co-payment
win be charged for rural health clinic ser-vices.
(11) Clinics (Other than Rural Health). Co-payment
will be charged at the rate of fifty
cents ($.50) per visit.
(12) Non- Hospital Dialysis Pacihty Services.
No co-payment wiU be charged for non-hospital
dialysis facility services.
(13) Home Health Services. No co-payment
will be charged for home health services.
(14) Hearing .Aid Dispensers. No co-payment
win be charged for services rendered by
hearing aid dispensers.
(15) Artibulance. No co-payment wiU be
charged for ambulance services.
(b) Co-payment Exemptions. No co-payment
will be charged for the following services:
(1) E PS DT related services;
(2) Family Planning Services;
(3) Services in state owned mental hospitals;
(4) Services covered by both Medicare and
.Medicaid;
(5) Services to children under age 18;
(6) Services related to pregnancy;
807 6:13 NORTH CAROLINA REGISTER September 30, 1991
PROPOSED RULES
(7) Sen'ices provided to residents of ICF,
ICF-MR, SNF, Mental Hospitals; and
(8) Hospital emergency room services.
Authority G.S. IOSA-25(b); S.L. 1985, c. 479, s.
86; 42 C.F.R. 440.230(d); Tax Equity and Fiscal
Responsibility Act of 1982, Subtitle B; Section 95
of Chapter 689, 1991 Session Laws.
SUBCHAPTER 2611 - RKIMBLRSEMENT PLANS
SECTION .0100 - REIMBURSEMENT FOR
NURSING FACILITY SERVICES
.0107 PAYMENT ASSURANCE
(a) The state will pay each provider of nursing
care services, who furnishes the services in ac-cordance
with the requirements of the State Plan
and the participation agreement, the amount de-termined
under the plan. In addition. Skilled
Nursing Facilities must be enrolled in the Title
XVI 11 Program.
(b) In no case shall the payment rate for ser-vices
provided under the plan exceed the facihty's
customary charges to the general public for such
services.
(c) The payment methods and standards set
forth herein are designed to enlist the partic-ipation
of any provider who operates a facility
both economically and efficiently. Participation
in the program shall be Limited to providers of
service who accept, as payment in full, the
amounts paid in accordance with the State Plan.
This reimbursement plan is effective consistent
with and on approval of the State Plan for Med-ical
Assistance.
(d) In all circumstances involving third party
payment, Medicaid is the payor of last resort.
No payment will be made for a Medicaid recipi-ent
who is also ehgible for Medicare, Part A, for
the first 20 days of care rendered to skilled nurs-ing
patients. Medicaid payments for co-insurance
for such patients will be made for the
subsequent 21st through the 100th day of care.
The Division of Medical Assistance will pay an
amount for Medicare Part A deductibles and co-insurance,
the total of which will equal the facil-ity's
Medicaid per diem rate less any Medicare
Part A payment, effective August 1, 1991. In the
case of ancillary services providers are obligated
to:
(1) maintain detailed records or charges for
all patients;
(2) bill the appropriate Medicare Part B car-rier
for aJl services provided to Medicaid
patients that may be covered under that
program; and
(3) allocate an appropriate amount of ancil-lary
costs, based on these charge records
adjusted to reflect Medicare denials of
coverage, to Medicare Part B in the an-nual
cost report,
(e) The state may withhold payments to pro-viders
under the following circumstances;
(1) If the state has a reasonable expection that
the provider wiU not expend its direct rate
for reasonable and allowable direct patient
care costs, the state may, at its discretion,
withhold a portion of each payment so as
to avoid a large amount due back to the
state upon reimbursement settlement
pursuant to the provision of Paragraph
.0104(e) of this Section.
(2) Upon provider termination the state may
withhold a sum of money from provider
payments that it reasonably expects will
be due when fmal reimbursement settle-ments
for all previous periods, including
the period in which the termination oc-curred,
are completed.
(3) Upon determination of any sum due the
Medicaid Program or upon instruction
from a legally authori^;ed agent of the
State or Federal Government the state
may withhold sums to meet the obli-gations
identified.
(4) The state may arrange repayment sched-ules
within the limits set forth in federal
regulations in lieu of withholding funds.
(5) The state m.ay charge reasonable interest
or overpayments from the date that the
overpayment occurred.
Authority G.S. I08A-25(b); I08A-54; I08A-55;
S.L. 1985, c. 479. s. 86; Section 95 of Chapter
689, 1991 Session Law.':; 42 C.F.R. 447, Subpart
C.
SECTION .0200 - HOSPITAL INPATIENT
REIMBURSEMENT PLAN
.0209 PAYMENT OF MEDICARE PART A
DEDUCTIBLES
In regard to payment of Medicare Part A
deductibles, the Division of Medical Assistance
wilJ pay the Medicaid median per diem inpatient
rate for one day in lieu of the Medicare Part A
inpatient deductible, effective August 1, 1991.
The median rate will be determined as of July 1
each year.
Authority G.S. l08A-25(b); 108A-54; lOSA-55;
Section '95 of Chapter 689. 1991 Session Laws;
42 C.F.R. 447, Subpart C.
SECTION .0500 - REIMBURSEMENT FOR
SERVICES
6:13 NORTH CAROLINA REGISTER September iO, 1991 808
PROPOSED RULES
.0508 ni RABLE MKDICAL EQLII'MENT AND
REEA lED SLPI'EIES
(a) l"tTecti\c August _L 1991, payment for each
claim tor durable medical equipment and associ-ated
supplies will be equal to the lower of the
supplier's usual and customary billed charges or
the maximum fee established for each item of
durable medical equipment or related supply.
The maximum fees are set at +tW percent e4 Ae
Medicare -Part 8- foes as &f Januur>' 4- trf each year.
the Medicaid fee schedule in effect on July j_^
l'J91. 1 ees tor added equipment \siU be set at
.Medicare I'art B fees. If a Medicare fee camiot
be obtained, fof a particular equipment item, the
fee will be b