FILED SENATE
Mar 30, 2023
GENERAL ASSEMBLY OF NORTH CAROLINA
S.B. 438
SESSION 2023 PRINCIPAL CLERK
S D
SENATE BILL DRS45194-NB-62
Short Title: NCORR Administrative Modifications. (Public)
Sponsors: Senators Jackson, Perry, and Britt (Primary Sponsors).
Referred to:
1 A BILL TO BE ENTITLED
2 AN ACT TO ESTABLISH PROCUREMENT PROCEDURES FOR CONSTRUCTION
3 PROJECTS FUNDED BY THE COMMUNITY DEVELOPMENT BLOCK GRANT
4 DISASTER RECOVERY PROGRAM, TO PROTECT HOMEOWNERS FROM AN
5 INCREASE IN PROPERTY TAX LIABILITY RESULTING FROM THE
6 REVALUATION OF REAL PROPERTY REHABILITATED USING COMMUNITY
7 DEVELOPMENT BLOCK GRANT DISASTER RECOVERY FUNDS OR HURRICANE
8 FLORENCE DISASTER RECOVERY FUNDS BY LIMITING THE ABILITY OF
9 ASSESSORS TO REAPPRAISE REAL PROPERTY AT HIGHER VALUES UNDER
10 CERTAIN CIRCUMSTANCES, TO INCREASE THE INFORMAL BID THRESHOLD
11 FOR CONTRACTS FOR CONSTRUCTION OR REPAIR WORK RELATED TO
12 DISASTER RECOVERY UNDERTAKEN BY THE NORTH CAROLINA OFFICE OF
13 RECOVERY AND RESILIENCY, AND TO MAKE OTHER PROGRAMMATIC
14 CHANGES.
15 The General Assembly of North Carolina enacts:
16 SECTION 1. G.S. 143B-1040 reads as rewritten:
17 "§ 143B-1040. Office of Recovery and Resiliency.
18 (a) The Office of Recovery and Resiliency (Office) is created in the Department of Public
19 Safety. The Office shall execute multi-year recovery and resiliency projects and administer funds
20 provided by the Community Development Block Grant Disaster Recovery program for
21 Hurricanes Florence and Matthew. Matthew and Tropical Storm Fred. The Office will provide
22 general disaster recovery coordination and public information; citizen outreach and application
23 case management; audit, finance, compliance, and reporting on disaster recovery funds; and
24 program and construction management services. The Office shall also contract for services from
25 vendors specializing in housing, construction, and project management services.
26 …
27 (d) Notwithstanding any other provision of law to the contrary, no provision of this
28 Subpart relating to standards and practices of applicant and homeowner eligibility, contractor
29 requirements, rehabilitation assistance, physical condition requirements, and displacement and
30 relocation shall be construed to be more restrictive than applicable federal law or other provisions
31 of applicable State law."
32 SECTION 2.(a) Subpart D of Part 5 of Article 13 of Chapter 143B of the General
33 Statutes is amended by adding the following new section to read:
34 "§ 143B-1042. Disaster recovery procurement.
35 (a) Definitions. – Unless otherwise provided, the following definitions apply in this
36 Subpart:
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 General Assembly Of North Carolina Session 2023
1 (1) Construction activities. – Any physical actions undertaken on property for
2 purposes of fulfilling the terms of a contract or for purposes of readying the
3 property for any work that requires a building permit, such as surveying
4 property lines or easements.
5 (2) Property. – Land, buildings or structures on land, permanent fixtures on land,
6 or manufactured or modular homes on land.
7 (b) Procurement. – All of the following shall apply to contracts awarded or assigned by
8 the Office that are related to detached single-family dwellings and are funded with funds provided
9 by the Community Development Block Grant Disaster Recovery program:
10 (1) The Office shall develop a priority-based system for awarding or assigning
11 contracts for the construction, reconstruction, alteration, repair, movement to
12 another site, removal, or demolition of detached single-family dwellings
13 which shall be based on all of the following:
14 a. The applicant's income for the prior 12 consecutive months, with
15 preference given to the lowest income applicants.
16 b. The applicant's age, with preference given to applicants over the age
17 of 62.
18 c. The presence of a person with a mental or physical disability in the
19 applicant's household.
20 d. The presence of dependents or minor children in the applicant's
21 household.
22 (2) Notwithstanding any other provision of law or any rule or regulation, the
23 Office shall limit the number of detached single-family dwellings included in
24 a single bid package or assignment to 20 or less; provided, however, at no time
25 shall a contractor be awarded or assigned a contract to perform construction
26 activities on more than a total of 20 detached single-family dwellings at one
27 time. Upon the completion of construction activities on 20 or less detached
28 single-family dwellings, which shall be demonstrated by the issuance of a
29 certificate of compliance or occupancy, a contractor may be awarded or
30 assigned additional contracts, but in no case shall the number of detached
31 single-family dwellings on which construction activities is to be performed
32 under the additional contracts exceed a total of 20.
33 (3) To protect the recovery program from financial loss if the contractor fails to
34 complete the construction activities within the time periods provided in
35 subdivision (4) of this subsection, all contracts awarded or assigned shall
36 include both of the following clauses:
37 a. Contract cancellation. – The clause shall clearly state that the failure
38 to begin construction activities as required by sub-subdivision a. of
39 subdivision (4) of this subsection shall result in the immediate
40 cancellation of the contract. Notwithstanding the provisions of
41 subdivision (1) of this subsection, if a contract is cancelled, as required
42 by this sub-subdivision, the Office shall immediately rebid the
43 contract, giving it priority as provided in subdivision (1) of this
44 subsection.
45 b. Liquidated damages. – The clause shall clearly state the event that will
46 trigger the commencement of the assessment of liquidated damages,
47 and, upon that event, the Office shall assess daily liquidated damages
48 in the amount of two hundred fifty dollars ($250.00) or two percent
49 (2%), whichever is greater. Liquidated damages collected shall be
50 deposited in the Hurricane Florence Disaster Recovery Fund.
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1 (4) A contractor who has been awarded or assigned a contract for the construction,
2 reconstruction, alteration, repair, movement to another site, removal, or
3 demolition of a detached single-family dwelling shall:
4 a. Begin construction activities on each property described in the contract
5 not less than 45 calendar days after the award or assignment.
6 b. Complete construction activities not later than 120 calendar days after
7 the award or assignment or the temporary relocation of the applicant,
8 whichever occurs later. Construction activities shall be deemed
9 completed upon the issuance of a certificate of compliance or
10 occupancy.
11 (5) The Office may, in writing, grant a contractor, who has been delayed in
12 completing construction activities in the time periods described in subdivision
13 (4) of this subsection due to unusual weather phenomena, an extension of time
14 in which to complete the construction activities, and the extension shall
15 remain in effect for the duration of the unusual weather phenomena and for
16 such time thereafter that is reasonably necessary for the effects of the unusual
17 weather phenomena to subside. For purposes of this subdivision, the term
18 "unusual weather phenomena" means a weather event that is unusual based on
19 the average of the preceding five-year climatic range during the same period
20 of time and locality where the construction activities are to be performed, as
21 reported by the National Oceanic and Atmospheric Administration National
22 Weather Service statistics.
23 (6) Within five business days of the completion of construction activities, the
24 Office shall conduct a final inspection of the property and shall take all
25 necessary steps to ensure that the applicant is able to take possession of the
26 property without unreasonable delay.
27 (7) A contractor shall not be awarded or assigned a contract unless the contractor
28 has completed at least seventy-five percent (75%) of the construction
29 activities on the property that is the subject of the contract. Upon completion
30 of construction activities as provided in this subdivision, which shall be
31 demonstrated by the issuance of a certificate of compliance or occupancy, the
32 Office may award or assign contracts to the contractors, which shall be subject
33 to the requirements of this section.
34 (8) Notwithstanding the provisions of this section, the Office may, depending
35 upon the construction activities required, impose time lines for the
36 commencement and completion of construction activities that are less than,
37 but not more than, the time lines as prescribed in subdivision (4) of this
38 subsection.
39 (9) Notwithstanding the provisions of this subsection, if a state of emergency is
40 declared by an authority listed in G.S. 166A-19.3(19), the Office shall not
41 assess liquidated damages as provided in sub-subdivision b. of subdivision (3)
42 of this subsection or require the contractor to comply with the time lines
43 described in subdivision (4) of this subsection if, in the determination of the
44 Office, the contractor's ability to perform as required by the contract or to meet
45 the time lines is substantially impaired by the emergency that led to the
46 declaration of the state of emergency."
47 SECTION 2.(b) Article 11 of Chapter 160D of the General Statutes is amended by
48 adding a new section to read:
49 "§ 160D-1112.1. Disaster recovery projects; priority given.
50 Notwithstanding any other provision of the State Building Code or other applicable State or
51 local laws, a local government inspection department and the inspectors in it shall give priority
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1 to inspection services, including inspections and reviewing, denying, and issuing permits,
2 required by this Article that involve the construction, reconstruction, alteration, repair, movement
3 to another site, removal, or demolition of a detached single-family dwelling that is funded, in
4 whole or in part, with funds provided by the Community Development Block Grant Disaster
5 Recovery program. The inspection department may require a contractor to present evidence, such
6 as a contract or other paperwork, proving the construction activities subject to the building permit
7 are funded by the Community Development Block Grant Disaster Recovery program prior to
8 giving priority as provided in this section."
9 SECTION 2.(c) The North Carolina Office of Resiliency and Recovery shall adopt
10 the priority-based system required by G.S. 143B-1042(b)(1), as enacted in Section 2(a) of this
11 act, not later than 30 days after the date this act becomes law. Not later than 30 days after adopting
12 the priority-based system, the Office shall submit a report to the Joint Legislative Commission
13 on Governmental Operations detailing the priority-based system and the criteria used to establish
14 the system.
15 SECTION 2.(d) This section applies to contracts renewed, extended, or awarded on
16 or after the date this act becomes law.
17 SECTION 3.(a) G.S. 105-283 reads as rewritten:
18 "§ 105-283. Uniform appraisal standards.
19 All Except as provided in G.S. 105-286.1, all property, real and personal, shall as far as
20 practicable be appraised or valued at its true value in money. When used in this Subchapter, the
21 words "true value" shall be interpreted as meaning market value, that is, the price estimated in
22 terms of money at which the property would change hands between a willing and financially able
23 buyer and a willing seller, neither being under any compulsion to buy or to sell and both having
24 reasonable knowledge of all the uses to which the property is adapted and for which it is capable
25 of being used. For the purposes of this section, the acquisition of an interest in land by an entity
26 having the power of eminent domain with respect to the interest acquired shall not be considered
27 competent evidence of the true value in money of comparable land."
28 SECTION 3.(b) G.S. 105-284(a) reads as rewritten:
29 "(a) Except as otherwise provided in this section, G.S. 105-286.1, and G.S. 105-328.1, all
30 property, real and personal, shall be assessed for taxation at its true value or use value as
31 determined under G.S. 105-283 or G.S. 105-277.6, and taxes levied by all counties and
32 municipalities shall be levied uniformly on assessments determined in accordance with this
33 section."
34 SECTION 3.(c) Article 14 of Subchapter II of Chapter 105 of the General Statutes
35 is amended by adding a new section to read:
36 "§ 105-286.1. Reappraisal limitation for certain rehabilitation of real property.
37 (a) Unless the context provides otherwise, the following definitions apply in this section:
38 (1) Owner. – A person who holds legal or equitable title, whether individually, as
39 a tenant by the entirety, a joint tenant, or a tenant in common, or as a holder
40 of a life estate or an estate for the life of another. For purposes of this
41 subdivision, a manufactured home jointly owned by husband and wife shall
42 be considered property held by the entirety.
43 (2) Permanent residence. – A person's legal residence, including the dwelling, the
44 dwelling site, not to exceed 1 acre, and related improvements. For purposes
45 of this subdivision, a dwelling includes a single-family residence, a unit in a
46 multifamily residential complex, or a manufactured home.
47 (3) Rehabilitation or rehabilitated. – The improvement of real property from
48 damaged, deteriorated, or substandard to good or better condition.
49 (b) A permanent residence that has increased in true value, as that term is defined in
50 G.S. 105-283, because it was rehabilitated using Community Development Block Grant Disaster
51 Recovery program funds, administered by the Office of Recovery and Resiliency, or the
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1 Hurricane Florence Disaster Recovery Fund, administered by the Office of State Budget and
2 Management, shall not be appraised at a value higher than the most recent value appraised prior
3 to the rehabilitation of the permanent residence unless one of the following occurs:
4 (1) The owner transfers the permanent residence to another through any means
5 allowed by law; provided, however, this subdivision shall not apply if (i) the
6 property is transferred to a co-owner of the permanent