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Raleigh , North Carolina
February 9, 2007
We welcomed retailers to town yesterday for our annual NCRMA legislative breakfast and meeting. House and Senate freshmen legislators as well as members from the Wake County delegation joined us for breakfast at the legislative building early Thursday morning to talk with their constituents about issues important to the retail industry.
As of today, only two weeks have passed of the 2007-2008 legislative session and House and Senate members together have already filed more than 260 bills. The Senate announced their committee assignments this week while House Speaker Joe Hackney (D-Orange) told House members that it will be Monday night or Tuesday before the chamber's committee assignments are made public.
As expected, there were not many surprises in the Senate Committee assignments. Senator Dan Clodfelter (D-Mecklenburg) will give up his Judiciary 1 Committee chairmanship to become one of the three co-chairs of Finance, joining Senators David Hoyle (D-Gaston) and John Kerr (D-Wayne). Senator Martin Nesbitt (D-Buncombe) was named to take over J-1. Some restructuring within the Senate Judiciary committees has taken place as Judiciary 1 is now designated for civil matters and Judiciary II will focus on legislation related to criminal matters. In a meeting this week with Senator Fletcher Hartsell (R- Cabarrus), Chair of Judiciary II, he invited us to educate the J-II committee members on the issue of organized retail crime early this session. Senator Hartsell extended this invitation after we shared the recent Food Marketing Institute Study that revealed North Carolina was losing $36 million in sales and use tax every year due to Organized Retail Theft. We will be working on a 40-minute presentation for the committee.
In an unexpected change, Senator Vernon Malone (D-Wake) will no longer be Co-chairing the Health & Human Services Appropriations Subcommittee but instead has switched to being a Co-Chair of the Appropriations Public Instruction Subcommittee. NCRMA has always worked quite well with Senator Malone, especially on issues concerning Medicaid reimbursement to retail community pharmacies. Senator Doug Berger (D-Franklin) has taken Senator Malone's role and joins Senator Bill Purcell (D-Scotland) in running this important committee.
Without much turnover in the chamber, the rest of the Senate committee makeup didn't change dramatically. Senators Kay Hagan (D-Guilford), Walter Dalton (D-Rutherford) and Linda Garrou (D-Forsyth) will continue as co-chairs of the Senate Appropriations Committee and Senate Majority Leader Tony Rand (D-Cumberland) will remain chairman of the powerful Rules Committee. First-time chairs or co-chairs named include Julia Boseman (D-New Hanover), Janet Cowell (D-Wake), and Joe Sam Queen (D-Haywood). Republican Senator Richard Stevens (Wake) rose in rank to get a lead role, one of only four R's in the Senate to do so.
We will report House committee assignments to you next week once appointments are made. The House voted unanimously to revise its committee structure, eliminating one of four judiciary committees and creating a Mental Health Reform Committee. The restructuring also includes the addition of Juvenile Justice, Energy and Energy Efficiency, and Agribusiness and Agricultural Economy committees. The State Government Committee has also been eliminated. A handful of other committees were combined or their responsibilities shifted in some way. To date, we have heard that Representative Bill Owens (D-Pasquotank) will be House Rules chair and that there will be a large number of committee chairs. We are told there could be eight House Appropriations chairs and as many as six Finance chairs.
Budget briefings for both chambers continue, this week focusing on the Department of Corrections and the mental health budget. Proponents of several bond proposals are beginning to strengthen their lobbying efforts as legislators ponder the implications of a treasurer's report suggesting they should approve no more than $384 million in borrowing in each of the next ten years.
Once the House appoints committees next week, most of the organizational tasks will have come to a close and the serious legislative business will be set to begin.
RETAIL BILLS OF INTEREST (Filed & Expected to be Filed)
BOTTLE BILL - Senator Doug Berger (D-Franklin) reported in his constituent newsletter this week that he will be introducing his Litter Reduction legislation next week, and that his intern has developed a PowerPoint presentation. His office will be seeking grassroots support for the issue. We will send you a copy of the bill and a summary of this legislation as soon as it is introduced. We are currently working with other interested parties on opposition to this legislation and are in the process of fine-tuning materials to disseminate to legislators once this bill is introduced.
VIOLENT VIDEO GAMES - As anticipated, Senator Julia Boseman (D-New Hanover) filed Senate Bill 87: No Violent / Obscene Video Game Sales to Minors this week. It appears to be the same bill she filed last session which requires retailers to build a separate section in your stores to sell "violent video games," and forces retailers to preview games to make a judgement call on where those games belong in the store. This creates a logistical nightmare for retailers - not to mention that all nine federal courts that have reviewed similar laws have ruled that these laws violate the 1 st Amendment of the United States Constitution. In the 2005-2006 Session, Boseman saw her bill pass the Senate unanimously and it looked certain that the bill was headed to the House Floor and was likely to be enacted . NCRMA worked fast and furious and were successful in getting this bill re-referred from the House Floor back to the House Judiciary II Committee, chaired by Representative Mickey Michaux (D-Durham) where the legislation eventually died. We expect another heated legislative battle this session.
PHOTO PROCESSING/DUTY TO REPORT CHILD PORNOGRAPHY - We had productive meetings this week with Representative Karen Ray (R-Iredell) and Representative Rick Glazier (D-Cumberland) co-sponsors of HB 27: Duty to Report Child Porn. The bill as introduced (text is copied below) would require that a film Processor, Photo Finisher, or Computer Technician Who, in the Course of Work, Encounters an Image of a Minor Engaging in Sexual Activity Must Report it to the National Center for Missing and Exploited Children and to the Appropriate Local Law Enforcement Officer. We explained that most retail stores with photo processing already have a store policy in place that addresses this issue and outlined our concerns about the bill. We discussed the following points: 1) Failure to report should not result in criminal penalties; 2) The duty to report to the authorities should rest with loss prevention rather than the individual store clerks; 3) The employer should have immunity as well as the employee; 4) We want to ensure that the bill does not engulf self-serve kiosks where a customer is able to go in and print their own pictures off a disk and leave; 5) We also made them aware that the definition of computer technician may need to be altered. After our discussions, both Rep. Ray and Rep. Glazier seemed very open to our concerns and expressed willingness to address them as needed in the bill.
GIFT CARDS - While meeting with Representative Rick Glazier (D-Cumberland) on HB 27: Duty to Report Child Pornography, Rep. Glazier mentioned that he will also be filing a bill to place further regulations on gift cards in North Carolina, prohibiting the use of expiration dates on gift cards and also further examining the practice of dormancy fees. We hope to see a draft of this bill in the next week. North Carolina's current law 1) allows a retailer to charge dormancy fees if the dormancy fees are stated in writing on the back of the card and 2) states that a retailer does not have to escheat the value of a gift card if there is no expiration date listed on the card but the retailer does have to escheat 60% of the value of the card after three years if the gift card contains an expiration date.
LABELING OF FOOD ITEMS FROM CLONED ANIMALS - Representative Larry Brown (R-Forsyth) introduced legislation this week subjecting a food manufacturer or retailer to civil and criminal penalties for distributing or selling food derived from cloned animals without conspicuously labeling the items as such.
Much more legislation affecting retail is anticipated in the coming weeks and we will keep you posted as those introductions take place. It is our pleasure to work on your behalf. Thank you for allowing us to continue to represent the retail perspective before the North Carolina General Assembly since 1902.
Until next week.
Fran Preston (franp@ncrma.org)
Andy Ellen (andye@ncrma.org)
Elizabeth Dalton (elizabethd@ncrma.org)
Lindsey Kueffner (lindseyk@ncrma.org)
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