HB 3 — 2018 Hurricane Florence Disaster Recovery Act.

The transfer authorized by this section and allocated in this act ratifies the prior budgetary action taken by the Governor and shall not be construed to duplicate that transfer of lottery funds.

SECTION 2.4.

Notwithstanding G.S.

143-215.73F,the Department of Environmental Quality shall transfer the sum of two million dollars ($2,000,000) for the 2018-2019 fiscal year from the Shallow Draft Navigation Channel Dredging and Aquatic Weed Fund to the Office of State Budget and Management to be credited to the Hurricane Florence Disaster Recovery Reserve.

SECTION 2.5.

Of the funds allocated to the Department of Insurance, Office of the State Fire Marshal, by subdivision (11) of Section 4.1 of S.L.

2016-124 for grants to volunteer fire departments, the sum of nine hundred thirty thousand four hundred seventy-seven dollars ($930,477) is transferred to the Hurricane Florence Disaster Recovery Reserve.

SECTION 2.6.

Notwithstanding any provision of law to the contrary, the Department of Transportation shall transfer from the HighwayFund the sum of sixty-five million dollars ($65,000,000) for the 2018-2019 fiscal year to the Office of State Budget and Management to be credited to the Hurricane Florence Disaster Recovery Reserve.

PART III.

SCOPE OF ACT SECTION 3.

Unless otherwise provided, Section 2.1(a) of this act applies to the North Carolina counties designated under a major disaster declaration by the President of the United States under the Stafford Act (P.L.

93-288) as a result of Hurricane Florence.

PART IV.

FUNDING OF DISASTER RELIEF/REIMBURSEMENT ALLOCATIONS OF FUNDS FOR DISASTER RELIEF Page 2 House Bill 3-Second Edition General Assembly Of North Carolina Third Extra Session 2018 SECTION 4.1.

The funds appropriated in Section 2.1(a) of this act in the Hurricane Florence Disaster Recovery Fund created in S.L.

2018-134 shall be allocated as provided in the Committee Report described in Section 6.1 of this act and as follows:

5 Department of Agriculture and Consumer Services $ 70,000,000 Community Colleges System Office $ 18,500,000 Department of Environmental Quality $ 4,000,000 Department of Health and Human Services $ 12,000,000 Housing Finance Agency $ 10,000,000 Department of Insurance $ 930,477 Department of Public Instruction $ 60,000,000 Department of Public Safety $ 100,000,000 Office of State Budget and Management $ 25,000,000 Department of Transportation $ 65,000,000 University of North Carolina – Board of Governors $ 33,000,000 REIMBURSEMENT FOR FUNDS PROVIDED UNDER THIS ACT SECTION 4.2.(a) A recipient of State funds under this act shall use best efforts and take all reasonable steps to obtain alternative funds that cover the losses or needs for which the State funds are provided, including funds from insurance policies in effect and available federal aid.

Further, each institution of higher education and non-State entity that receives State funds under this act shall also seek private donations to help cover the losses or needs for which these State funds are provided.

SECTION 4.2.(b) If a recipient obtains alternative funds pursuant to subsection (a) of this section, the recipient shall remit the funds to the State agency from which the State funds were received.

A recipient is not required to remit any amount in excess of the State funds provided to the recipient under this act.

The State agency shall transfer these funds to the Hurricane Florence Disaster Recovery Fund.

The funds shall further be transferred to the applicable fund or reserve from which the funds were originally transferred to the Fund, except that the first twenty-five million dollars ($25,000,000) deposited under this subsection as reimbursement for funds expended for repair and renovation of facilities damaged by Hurricane Florence for local school administrative units, lab schools, and any eligible Innovative School District shall be transferred to the Education Lottery Reserve Fund.

Funds deposited into the Fund under this subsection are receipts that do not constitute an "appropriation made by law," as that phrase is used in Section 7(1) of Article V of the North Carolina Constitution.

SECTION 4.2.(c) Any contract or other instrument entered into by a recipient for receipt of funds under this act shall include the requirements set forth in subsections (a) and (b) of this section.

SECTION 4.2.(d) For purposes of this section, the term "recipient" means a local political subdivision of the State, a State agency, a State department, an institution of higher education as defined in Section 5.3(a) of this act, a public school unit as defined in Section 5.1 of this act, or a non-State entity.

ADDITIONAL LIMITATIONS ON USE OF FUNDS SECTION 4.3.(a) The Governor shall ensure that funds appropriated in this act are expended in a manner that does not adversely affect any person's or entity's eligibility for federal fundsthat are made available,orthat are anticipatedto bemade available, as aresult of Hurricane Florence.

The Governor shall also, to the extent practicable, avoid using State funds to cover costs that will be, or likely will be, covered by federal funds.

SECTION 4.3.(b) The Governor maynot use the funds described in this act to make reallocations under G.S.

166A-19.40(c).

Nothing in this act shall be construed to prohibit the House Bill 3-Second Edition Page 3 General Assembly Of North Carolina Third Extra Session 2018 Governor from exercising the Governor's authority under this statute with respect to funds other than those described in this act.

4 PART V.

IMPLEMENTATION OF ACT 6 AVERAGE DAILY MEMBERSHIP DETERMINATION SECTION 5.1.

Notwithstanding any other provision of law, in allocating funds for the 2018-2019 fiscal year, the State Board of Education shall adjust the allotted average daily membership (ADM) of public school units for the 2018-2019 school year in a manner that will assist units impacted by Hurricane Florence as follows:

Allotment adjustments for ADM decreases shall be based on the highest of the first four months' ADM for public school units located in counties designated under a major disaster declaration by the President of the United States under the Stafford Act (P.L.

93-288) as a result of Hurricane Florence.

Consistent with the Allotment Adjustments for ADM Growth provisions of the NC Public Schools Allotment Policy Manual applicable for the 2018-2019 school year, local school administrative units are encouraged to apply for additional funding to address needs related to extraordinary ADM growth due to an influx of displaced students as a result of Hurricane Florence.

If the State Board of Education does not have sufficient resources in the ADM Contingency Reserve line item to make allotment adjustments in accordance with this section, the State Board of Education may use funds appropriated to State Aid for Public Schools for this purpose.

For the purposes of this section, "public school unit" is defined as a local school administrative unit, regional school, innovative school, laboratory school, charter school, or residential school for the deaf or the blind.

CAPITAL RECOVERY FUNDS – PUBLIC SCHOOL FACILITIES SECTION 5.2.

The funds allocated to the Department of Public Instruction in this act shall not be subject to approval by the State Board of Education.

EMERGENCY SCHOLARSHIP GRANTS FOR POSTSECONDARY STUDENTS SECTION 5.3.(a) Program Established;

Purpose.

– There is established the Hurricane Florence Emergency Grant Program for Postsecondary Students (Program) to provide emergencyscholarship grants in anamount upto onethousand two hundred fiftydollars($1,250) per student to eligible postsecondary students who have suffered financial hardship due to the damage and destruction from Hurricane Florence.

An emergency scholarship grant shall be used to mitigate the impact of Hurricane Florence on a student so that his or her postsecondary education in a North Carolina institution of higher education continues uninterrupted.

These funds maybe used to cover anyexpenses that support a student's continued enrollment, including costs related to transportation, textbooks, tuition, fees, and living expenses.

For the purposes of this section, an "institution of higher education" is defined as a constituent institution of The University of North Carolina, a community college under the jurisdiction of the State Board of Community Colleges, or an eligible private postsecondary institution, as defined in G.S.

116-280(3).

SECTION5.3.(b) Applications;

Eligibility.

– ByNovember1, 2018, each institution of higher education that is eligible for an allocation of funds pursuant to this section shall begin accepting applications from eligible postsecondary students.

An application for an emergency scholarship grant must demonstrate that the student is an eligible postsecondary student by including documentation that the student meets the following criteria:

(1) The student is enrolled in the institution of higher education at the time of application.

Page 4 House Bill 3-Second Edition General Assembly Of North Carolina Third Extra Session 2018 (2) The student has a financial need related to the impact of Hurricane Florence.

(3) The student meets at least one of the following criteria:

TheIf institution of higher education in which the studentpublic wasschool enrolledunit's asscheduled ofcalendar Septemberwill 10,already 2018,meet is185 locatedinstructional indays aor county1025 designatedinstructional underhours, ano majoradditional disasterdays declarationor byhours thefor Presidentthat ofschool theare Unitedrequired Statesto undercomply thewith StaffordG.S. Act (P.L.

93-288)115C-84.2. as a result of Hurricane Florence.

TheFor studentall resided,other asschools, offor Septemberdays 10,missed 2018,in temporarilyexcess orof permanently,two days, in athe countydesignateddiscretion underof aits majorgoverning disasterbody, declarationthe bypublic theschool Presidentunit ofmay thedo Unitedeither Statesor undera thecombination Staffordof Actthe (P.L.following:

93-288)1. as a result of Hurricane Florence.

SECTIONMake 5.3.(c)up Awardany number of Grants.the instructional days or equivalent hours missed.

–2. Within the funds available to an institution of higher education in accordance with this section, an institution shall award an emergency scholarship grant to an eligible postsecondary student within two weeks of the receipt of the application, or as soon as otherwise practicable, in an amount of up to one thousand two hundred fifty dollars ($1,250) based on the information provided in the student's application.

AnDeem institutionas ofcompleted higherany educationnumber may establish priority in the award of emergency scholarship grants to eligible postsecondary students based on the fundsinstructional availabledays andor theequivalent poolhours ofmissed. applicants, including giving priority to students who have demonstrated the greatest financial need.

IfFor nothe prioritypurposes inof thethis awardact, of"public fundsschool unit" is established,defined theas emergencya scholarshiplocal grantsschool shalladministrative beunit, awardedregional inschool, theinnovative orderschool, inlaboratory whichschool, applicationscharter areschool, received.or residential school for the deaf or the blind.

IfSECTION1.2. the institution of higher education has unexpended funds remaining after the award of the initial emergency scholarship grants, the institution may increase the award to an eligible postsecondary student who previously received funds or solicit additional applications from eligible postsecondary students, provided that the award to an individual student does not exceed one thousand two hundred fifty dollars ($1,250) for each academic semester in which funds are awarded.

SECTION5.3.(d)EmployeeCompensation. Reimbursementfor Losses CoveredbyOther Funds.

–Aneligible–Except postsecondarystudentforin whothecaseofacharterschool, receivesall anemployees emergencyemployed scholarshipby granta underpublic theschool Programunit shall usebe bestdeemed effortsto andhave takebeen allemployed reasonablefor stepsany toscheduled obtaininstructional alternativedays fundsmissed thatdue coverto theHurricane lossesFlorence orduring needsthe formonths whichof theSeptember emergency2018 scholarshipand grantOctober funds2018 arethat provided,a includingpublic fundsschool fromunit insurancehas policiesdeemed incompleted effect and availableis federalnot aid.required to make up.

IfEmployees the student obtains alternative funds, the student shall remitbe thecompensated amountin of the emergencyscholarshipsame grantmanner coveredtheywould bythehave alternativehad fundstheyworked toon the institutionscheduled ofinstructional higherdays education.missed.

AThe studentboard isof notdirectors requiredof toa remitcharter anyschool amountmay, inbut excessis ofnot therequired fundsto, providedprovide tosuch thecompensation student.for its employees.

SECTIONOf 5.3.(e)the Fundsfunds allocated to the Department of Public Instruction from the Hurricane Florence Disaster Recovery Fund, the sum of up to six million five hundred thousand dollars ($6,500,000) in nonrecurring funds for UNCthe Constituent2018-2019 Institutions.fiscal year shall be used to provide compensation authorized by this section to public school unit employees of schools participating in the National School Lunch Program or School Breakfast Program for scheduled instructional days when compensation would have been provided by school meal receipts or by federal funds.

–Employees Ofcompensated theusing funds allocateddescribed to the Board of Governors of The University of North Carolina from the Hurricane Florence Disaster Recovery Fund for the 2018-2019 fiscal year, the sum of two million dollars ($2,000,000) in nonrecurringthis fundssection shall be allocatedcompensated byin the Boardsame ofmanner Governorsthey towould constituenthave institutionshad ofthey Theworked Universityon of North Carolina for the purposescheduled ofinstructional providingdays emergencymissed. scholarship grants to eligible postsecondary students in accordance with the Program.

TheIf Boardthe offunds Governorsdescribed shallby prioritizethis section are insufficient to provide compensation authorized bythis section to public school unit employees in schools participating in the allocationNational ofSchool fundsLunch basedProgram onor School Breakfast Program for scheduled instructional days when compensation would have been provided by school meal receipts or by federal funds, the impactDepartment of HurricanePublic FlorenceInstruction onshall enrolleddevelop studentsa uniform criteria to determine the followingcomparative constituenteconomic institutions:need of public school units to which this section applies and shall ensure that priority is given to public school units with greatest economic need when awarding available funds.

(1)SECTION A1.3. constituent institution located in a county designated under a major disaster declaration by the President of the United States under the Stafford Act (P.L.

93-288)Reporting asRequirement. a result of Hurricane Florence.

(2)– AThe constituentSuperintendent institutionof thatPublic isInstruction notshall locatedreport ato countythe designatedchairs underof athe majorHouse disasterof declarationRepresentatives byCommittee on Appropriations and the PresidentSenate Appropriations/Base Budget Committee, the Joint Legislative Education Oversight Committee, and the Fiscal Research Division of the UnitedGeneral StatesAssembly underon the Staffordimplementation Actof (P.L.this act by public school units by March 15, 2019, and shall also provide any additional reports or information requested by the Fiscal Research Division.

93-288)The asreport arequired result of Hurricane Florence but has an eligible postsecondary student enrolled at the institution who (i) resides, temporarily or permanently, in a county designated under a major disaster declaration by thethis Presidentsection ofshall theinclude Unitedinformation Stateson under the Staffordfollowing: Act (P.L.

93-288)(1) asAny adays Housemissed Billdue 3-Secondto Edition Page 5 General Assembly Of North Carolina Third Extra Session 2018 result of Hurricane Florence orbefore, (ii)on, hasor transferredafter to the institutioneffective duedate toof thethis damageact. and destruction caused by Hurricane Florence.

ConstituentPage institutions2 allocatedHouse fundsBill under3-First thisEdition subsectionGeneral shallAssembly haveOf discretionNorth toCarolina establishThird criteriaExtra forSession 2018 (2) Of the eligibilitydays ofmissed, postsecondaryany studentsscheduled inmake additionup days due to Hurricane Florence before, on, or after the criteriaeffective requireddate byof this section.act, and the dates of those make up days.

However,(3) Of the Boarddays ofmissed, Governorsany shalldays notand establishhours additionaldeemed eligibilitycompleted requirementsby for the administrationpublic ofschool theunit Programas toa thoseresult setof forth in this section.act.

SECTION(4) 5.3.(f)Any Fundscompensation forprovided Communityto Colleges.employees pursuant to Section 1.2 of this act.

–For Ofeach thecomponent fundsof allocated to the Communityreport, Collegesseparate Systeminformation Officeshall frombe theincluded Hurricaneon Florenceany Disasterindividual Recoveryschools Fundwithin for the 2018-2019public fiscalschool year,unit thewhose suminformation ofdiffers fivefrom million dollars ($5,000,000) in nonrecurring funds shall be allocated by the Staterest Board of Community Colleges to community colleges for the purposeunit ofas providinga emergencywhole. scholarship grants to eligible postsecondary students in accordance with the Program.

ThePublic Stateschool Boardunits of Community Colleges shall prioritizeprovide theinformation allocationon implementation of fundsthis basedact onin the impactsform ofrequested Hurricaneby Florencethe onSuperintendent enrolledof studentsPublic toInstruction theno followinglater communitythan colleges:February 15, 2019.

(1)PART AII. community college located in a county designated under a major disaster declaration by the President of the United States under the Stafford Act (P.L.

93-288)COMPLETION asOF aTHE resultEPP ofCLINICAL HurricaneINTERNSHIP Florence.REQUIREMENT FOR CERTAIN STUDENTS IMPACTED BY HURRICANE FLORENCE SECTION 2.1.

(2) A community college that is not located in a county designated under a major disaster declaration by the President of the United States under the Stafford Act (P.L.

93-288) as a result of Hurricane Florence but has an eligible postsecondary student enrolled at the community college who (i) resides, temporarily or permanently, in a county designated under a major disaster declaration by the President of the United States under the Stafford Act (P.L.

93-288) as a result of Hurricane Florence or (ii) has transferred to the community college due to the damage and destruction caused by Hurricane Florence.

Community colleges allocated funds under this subsection shall have discretion to establish criteria for the eligibility of postsecondary students in addition to the criteria required by this section.

However, the State Board of Community Colleges shall not establish additional eligibility requirements for the administration of the Program to those set forth in this section.

SECTION 5.3.(g) Funds for Private Postsecondary Institutions.

– Of the funds allocated to the Board of Governors of The University of North Carolina from the Hurricane Florence Disaster Recovery Fund for the 2018-2019 fiscal year, in addition to the two million dollars($2,000,000)allocatedto constituent institutions pursuant to subsection (e)ofthis section, the sum of one million dollars ($1,000,000) in nonrecurring funds shall be allocated to the State Education Assistance Authority (Authority) to provide funds to eligible private postsecondary institutions as defined in G.S.

116-280(3) for the purpose of providing emergency scholarship grants to eligible postsecondary students in accordance with the Program.

The Authority shall prioritize the allocation of funds based on the impact of Hurricane Florence on enrolled students to the following eligible private postsecondary institutions:

(1) A private postsecondary institution with a campus located in a county designated under a major disaster declaration by the President of the United States under the Stafford Act (P.L.

93-288) as a result of Hurricane Florence.

(2) A campus of a private postsecondary institution that is not located in a county designated under a major disaster declaration by the President of the United States under the Stafford Act (P.L.

93-288) as a result of Hurricane Florence but has an eligiblepostsecondarystudent enrolled at theprivate postsecondary institution who (i) resides, temporarilyor permanently, in a countydesignated under a major disaster declaration by the President of the United States under the Stafford Act (P.L.

93-288) as a result of Hurricane Florence or (ii) has Page 6 House Bill 3-Second Edition General Assembly Of North Carolina Third Extra Session 2018 transferred to the private postsecondary institution due to the damage and destruction caused by Hurricane Florence.

Private postsecondary institutions allocated funds under this subsection shall have discretion to establish criteria for the eligibility of postsecondary students in addition to the criteria required by this section.

However, the Authority shall not establish additional eligibility requirements for the administration of the Program to those set forth in this section.

A private postsecondaryinstitution receiving funds pursuant to this subsection shall report to the Authority on the implementation of the Program, including the information required for the report under subsection (h) of this section.

SECTION 5.3.(h) Reporting Requirements.

– By April 1, 2019, the Board of Governors of The Universityof North Carolina, the State Board of CommunityColleges, and the Authorityshall reportto thechairs oftheHouseofRepresentativesCommitteeonAppropriations and the Senate Appropriations/Base Budget Committee, the Joint Legislative Education Oversight Committee, Office of Recovery and Resiliency in the Department of Public Safety, and to the Fiscal Research Division of the General Assembly on the implementation of the Program at the institutions of higher education that received funds pursuant to this section, including the number and type of institutions of higher education that were allocated funds, the amount of funds allocated to each institution, the number of emergency scholarship grants awarded to students and theamount of those grants,theuseof emergencyscholarship grant funds byeligible postsecondary students, anyfunds reimbursed to institutions dueto coverage of losses by alternative funds, and any remaining funds available for awards in subsequent semesters.

BEHAVIORAL HEALTH SERVICES SECTION 5.4.(a) The following definitions apply in this section:

(1) DMH/DD/SAS.

– The Division of Mental Health, Developmental Disabilities, and Substance Abuse Services within the Department of Health and Human Services.

(2) Federally declared disaster area.

– Any county designated under a major disaster declaration by the President of the United States under the Stafford Act (P.L.

93-288) as a result of Hurricane Florence.

(3) LME/MCO.

– As defined in G.S.

122C-3.

(4) Qualifying LME/MCO.

– An LME/MCO with a catchment area that includes at least one federally declared disaster area.

SECTION 5.4.(b) It is the intent of the General Assemblyto support individuals and families experiencing distress as a result of Hurricane Florence bymeeting the increased demand for behavioral health services in the counties most impacted by Hurricane Florence.

To that end, fundsallocatedinthisactfromtheHurricaneFlorenceDisasterRecoveryFundtotheDepartment of Health and Human Services, Division of Mental Health, Developmental Disabilities, and Substance Abuse Services, to increase single-stream funding, shall be allocated by DMH/DD/SAS among LME/MCOs with a catchment area that includes at least one federally declared disaster area.

DMH/DD/SAS shall determine the basis for allocating these funds among qualifying LME/MCOs.

Qualifying LME/MCOs shall not use these allocated funds for any purpose other than to fund mental health, developmental disabilities, and substance use disorder services that are (i) for individuals residing in a federally declared disaster area who have been determined by the LME/MCO to be in need of these services as a result of Hurricane Florence, and (ii) not reimbursable under the Medicaid program.

Each qualifying LME/MCO shall offer at least the same level of single-stream service utilization required by Section 11F.2(b) of S.L.

2017-57, as amended, increased proportionately by the amount of single-stream funding allocated to the LME/MCO pursuant to this section.

SECTION 5.4.(c) Pursuant to its authority under G.S.

108A-54(e), the Department of Health and Human Services shall manage, within the Medicaid budget, any increased demand House Bill 3-Second Edition Page 7 General Assembly Of North Carolina Third Extra Session 2018 for behavioral health services reimbursable under the Medicaid program for individuals residing in a federally declared disaster area.

4 ASSISTANCE FOR UNAFFILIATED COMMUNITY HOSPITALS SECTION 5.5.(a) It is the intent of the General Assembly to assist unaffiliated communityhospitals, especiallythose serving rural areas, in covering the increase in nursing and other staffing expenses related to Hurricane Florence.

To that end, funds allocated in this act from the Hurricane Florence Disaster Recovery Fund to the Department of Health and Human Services,DivisionofCentralManagementandSupport,OfficeofRuralHealth,shallbeallocated to the North Carolina Hospital Foundation (NCHF), a nonprofit corporation.

NCHF shall use thesefundsto award grants, on abasis determined byNCHF, to unaffiliated communityhospitals located in counties designated under a major disaster declaration by the President of the United States under the Stafford Act (P.L.

93-288) as a result of Hurricane Florence, with priority consideration giventounaffiliatedcommunityhospitalsservingrural areas.

Grantrecipientsshall not use these funds for any purpose other than to (i) offset the cost of increased nursing and other staffing expenses related to Hurricane Florence, and, after this purpose is fulfilled, (ii) assist the community hospital with other relief related to Hurricane Florence.

Grant recipients are prohibited from using these funds to supplant existing funds for community recovery related to Hurricane Florence.

Notwithstanding Section 3.1(c) of S.L.

2018-134, any funds allocated pursuant to this section that have not been expended or encumbered as of June 30, 2019, shall revert to the Hurricane Florence Disaster Recovery Fund.

SECTION 5.5.(b) ByJuly15, 2019, each unaffiliated community hospital receiving grant funding from NCHF pursuant to subsection (a) of this section shall submit to the Office of Rural Health and the Office of Recovery and Resiliency in the Department of Public Safety a written report of all expenses funded by State appropriations.

By December 1, 2019, the Office of Rural Health shall submit a written report to the Joint Legislative Oversight Committee on Health and Human Services and the Fiscal Research Division on the use of the funds allocated pursuant to subsection (a) of this section.

EXTEND 90-DAY TRANSITION PERIOD IN CERTAIN COUNTIES/CHILD CARE SUBSIDY SECTION5.6.(a) Notwithstandinganyotherprovision oflaworruletothecontrary, the Department of Health and Human Services, Division of Child Development and Early Education, shall extend the transition period from 90 days to 120 days for a child care subsidy recipient who is otherwise eligible for child care subsidy and resides in an area damaged or impacted by Hurricane Florence if the recipient is (i) temporarily absent from employment, training, or an educational program with arrangements to continue the same employment, training, or educational program, (ii) unemployed but seeking employment, or (iii) no longer attending a training or educational program but is seeking employment or to resume attendance at a training or educational program.

SECTION 5.6.(b) This Section applies only (i) in the counties designated under a major disaster declaration by the President of the United States under the Stafford Act (P.L.

93-288) as a result of Hurricane Florence and (ii) for the 2018-2019 fiscal year.

CREATION OF OFFICE OF RECOVERY AND RESILIENCY/GRANTS SECTION 5.7.(a) The Office of Recovery and Resiliency (Office) is created in the DepartmentofPublicSafety.TheOfficeshallexecutemulti-yearrecoveryandresiliencyprojects and administer funds provided by the Community Development Block Grant Disaster Recovery program.

The Secretary may reassign up to 15 existing positions of the Division of Emergency Management to the Office.

In addition, the Secretary may create up to 30 new three-year time-limited positions.

The reassigned positions assigned to the Office shall retain the Page 8 House Bill 3-Second Edition General Assembly Of North Carolina Third Extra Session 2018 employment status of the positions at the time of the reassignment after implementation of this act is completed.

The three-year time-limited positions created in this section shall be temporary positions and are exempt from the provision of the State Human Resources Act, Chapter 126 of the General Statutes, except Articles 6 and 7 of that Chapter.

The Office will provide general disaster recovery coordination and public information;

citizen outreach and application case management;

audit, finance, compliance, and reporting on disaster recovery funds;

and program and construction management services.

The Office shall also contract for services from vendors specializing in housing, construction, and project management services.

SECTION 5.7.(b) The Office shall develop and administer a grant program for financially distressed local governments to assist with recovery capacity.

The grants shall cover the salaries, benefits, and operating costs for up to two three-year positions and may also be used to purchase one vehicle per community as necessitated by the individual circumstances of each community.

The Office shall also, in consultation with the Local Government Commission, develop and administer a one-time emergency fund for local governments in disaster-affected areas that need immediate cash flow assistance.

These funds shall be used to meet local government debt service obligations, to meet payroll obligations for local governments, and to meet vendor payments where nonpayment would result in negative financial outcome.

OFFICE OF RECOVERY AND RESILIENCY REPORTS SECTION5.8.(a) BeginningJanuary1,2019,theOfficeofRecoveryand Resiliency (Office)shall provide quarterlyreportsto theDirectorofthe Budget, thestandingAppropriations Committees of the Senate and the House of Representatives, and the Fiscal Research Division on the use of State disaster recovery and assistance funds expended from the Hurricane Florence Recovery Fund.

The reports shall summarize oversight activities and the results achieved as well as all of the following:

(1) Expenditures by program and by source of funds.

(2) Expenditures required to receive federal grants.

(3) Federal funding provided to the State to refund certain federally related spending.

(4) Actual and projected State spending data including time lines and milestones.

(5) State spending data classified by disaster phase to include preparedness, response, mitigation, and recovery.

(6) Total State spending data by agency and by program.

(7) Total State spending by program and county, where practicable.

(8) Location and job responsibilities of all time-limited State positions created under this act or paid for with federal funds received as a result of Hurricane Florence.

SECTION 5.8.(b) In addition to the quarterly reports required under subsection (a) ofthissectionandbeginningJanuary1,2020,theOfficeshallprovideannualreportsthatcompile the information contained in the quarterly reports.

The annual reports shall be submitted to the entities required under subsection (a) of this section.

NATIONAL GUARD MEMBERS/REEMPLOYMENT SECTION 5.9.

G.S.

127A-202(a) reads as rewritten:

"(a) Release From State Duty.

– Upon an employee's release from state duty, the employee's previous employer shall reemploy the employee in the employee's previous position within five days of the employee's release from state duty.

If the employee's state duty lasted 30 days or less, the employee shall make written application to the employee's previous employer for reemployment no later than the first regularly scheduled work period which that begins eight hours 24 hours after the employee has safely traveled from the place of state service to the employee's residence.

If the employee's state duty lasted more than 30 days, the employee shall House Bill 3-Second Edition Page 9 General Assembly Of North Carolina Third Extra Session 2018 make written application to the employee's previous employer for reemployment within 14 days of the employee's release from state duty.

If the employee is still qualified for the employee's previous employment, the employee shall be restored to the employee's previous position or to a position of like seniority, status, and salary, unless the employer's circumstances now at that time make the restoration unreasonable.

If the employee is no longer qualified for the employee's previous employment, the employee shall be placed in another position, position for which the employee is qualified, qualified and which that will give the employee appropriate seniority, status, and salary, unless the employer's circumstances now at that time make the placement unreasonable." NORTH CAROLINA NATIONAL GUARD/OVERPAYMENT OF FUNDS SECTION 5.10.

143-64.80,115C-269.25(d)(1), thea Officestudent ofwho Stateis Controllerenrolled shallin waivean anyeducator outstandingpreparation debtprogram arising(EPP) from,that oris asassigned athe resultstatus of,of anyinitially Stateauthorized activeor dutyauthorized performed by Norththe CarolinaState NationalBoard Guardof ServiceEducation memberspursuant in response to HurricaneG.S. Matthew in 2016 due to overpayment of state active duty salary.

The115C-269.5 Departmentmay of Public Safety shall reimburse those North Carolina National Guard Service members who have alreadythe reimbursedclinical theinternship Staterequirement forset suchforth overpayments.in G.S.

HURRICANE115C-269.25(d)(1) FLORENCEdeemed AGRICULTURALcompleted DISASTERif PROGRAMthe OFstudent 2018meets SECTIONthe 5.11.(a)following Theconditions: General Assembly finds that:

(1) The historicstudent floodmeets andat otherleast impactsone of Hurricane Florence in September of 2018 caused unprecedented damage to the Statefollowing: and its people, with particular devastating statewide impacts on North Carolina farmers and the State's agriculture industry.

(2) The State has over 50,000 farms across over 8 million acres, which generates 87 billion dollars of economic impact annually and represents the State's number one industry, making it a vital component to a healthy state economy.

(3) The total loss of crops as a result of the flooding is estimated at over a billion dollars and the estimated federal crop insurance payments will only cover a percentage of the total crop loss.

(4) The federal crop insurance program as authorized in the 2014 Farm Bill is an inadequate method of indemnification as compared to traditional forms of insurance and is not sufficient to aid farmers with substantial losses due to catastrophic events of nature.

(5) The State has a significant public interest to prevent the economic collapse of many of the State's farms, which could cause a severe disruption in the State's economy and food supply chain.

(6) The most effective program for administration of financial assistance is two-fold.

The first category shall be based on information available from the Farm Service Agency ("FSA") within the United States Department of Agriculture ("USDA").

The second category, for producers who do not participate in FSA programs, shall be based on verifiable documentation from producers.

SECTION 5.11.(b) For purposes of this section, the following definitions apply:

(1) Agricultural commodity.

– Apples, barley, corn, cotton, drypeas, flax, forage, freezingandcanningpeas,grainsorghum, grapes, hay,industrialhemp,native grass, nursery crops, nuts, oats, peanuts, potatoes, rye, soybeans, sunflowers, sweet corn, tobacco, tomatoes, wheat, specialty crops and other fruits and vegetables, and aquacultural species propagated or reared in a controlled or selected environment.

An agricultural commodity does not include stored grain.

Page 10 House Bill 3-Second Edition General Assembly Of North Carolina Third Extra Session 2018 (2) Department.

– The Department of Agriculture and Consumer Services.

(3) Fund.

– The Hurricane Florence Agricultural Disaster Fund.

(4) Livestock.

– Cattle, sheep, swine, goats, farmed cervids, and bison.

Livestock shall include horses, mules, or other equines only if they are used for production of agricultural commodities.

(5) Person.

– Any individual, trust, estate, partnership, receiver, association, company, limited liability company, corporation, or other entity or group.

(6) Poultry.

– Chickens, quail, or turkeys.

(7) State.

– The State of North Carolina.

(8) USDA.

– The United States Department of Agriculture.

SECTION 5.11.(c) The Hurricane Florence Disaster Fund is established as a special fund in the Department of Agriculture and Consumer Services.

The Fund consists of allocations directed by the General Assembly and contributions and grants from public or private sources.

The Fund shall be used for a financial assistance program that provides assistance to farmers affected by Hurricane Florence.

The Department may not use funds for administrative purposes.

Earnings on the contributions and grants deposited in the Fund shall be credited to the Fund.

The Fund shall expire upon the complete expenditure of funds allocated for the purposes specified herein.

SECTION 5.11.(d) To be eligible for financial assistance for losses of agricultural commodities, a person must satisfy all of the following criteria:

(1) The person experienced a verifiable loss of agricultural commodities as a result of Hurricane Florence, and the person's farm is located in a North Carolina county that is or becomes any of the following:

DesignatedIs underenrolled in an EPP that is located in a county declared a major disaster declaration by the President of the United States under the Stafford Act (P.L.

IncludedHas inbeen eitherplaced awith Secretarialan Disasterelementary Declaration for Hurricane Florence issued by the United States Secretary of Agriculture or thesecondary Presidentialpartner Federalschool, Emergencyas Managementdefined Agencyin DeclarationG.S. for Hurricane Florence.

(2)115C-269.1(14), Thethat agriculturalis commoditywaslocated plantedin ona orcounty beforedeclared Septembera 13,major 2018,disaster or,by forthe aquaculturePresident commodities,of the commoditiesUnited wereStates beingunder raisedthe onStafford orAct before(P.L. September 13, 2018.

SECTION 5.11.(e) A person seeking financial assistance for losses of agricultural commodities shall submit to the Department a Form 578 on file with the USDA Farm Service Agency or a form provided by the Department for reporting acreage or plantings of crops not typically reported on Form 578, along with any other documentation deemed appropriate by the Department, on or before December 10, 2018.

For nursery crops, fruit-bearing trees and bushes, and specialty crops where the survival level is not immediately known, the Department may extend this deadline to May 1, 2019, upon written request by the person received on or before December 10, 2018, and upon approval by the Department.

A person receiving assistance under this program must provide a signed affidavit, under penalty of perjury, certifying that each fact of the loss presented by the person is accurate.

SECTION 5.11.(f) To be eligible for financial assistance for losses of livestock or poultry, a person must first qualify for and receive payment through the USDA Livestock IndemnityProgram and beaparticipantin alivestockorpoultryindemnityprogram administered by the USDA Farm Service Agency.

SECTION 5.11.(g) A person seeking financial assistance for losses of livestock or poultry shall submit documentation of loss and indemnity received from the USDA Livestock IndemnityProgram, along with anyother documentation deemed appropriate bythe Department, to the Department on or before December 10, 2018.

The Department may extend this deadline to House Bill 3-Second Edition Page 11 General Assembly Of North Carolina Third Extra Session 2018 March 1, 2019, upon written request by the person received on or before December 10, 2018, and upon approval by the Department.

A person receiving assistance under this program must provide a signed affidavit, under penaltyof perjury, certifying that each fact of the loss presented by the person is accurate.

SECTION 5.11.(h) The Department shall administer the financial assistance program authorized by this section in accordance with the following criteria:

(1) In determining the payment calculation for agricultural commodities, the Department shall use a formula based on acreage, county loss estimates, and USDA National Agricultural Statistics Service averages, and any other measure the Department deems appropriate.

Funds shall be distributed based on county averages for yields and State averages for price.

Calculations shall be based on county or State averages in price, whichever the Department determines is appropriate.

(2) The payment calculation for livestock and poultry shall be based on twelve and one-half percent (12.5%) of the total loss reported to the USDA Livestock Indemnity Program.

(3) The Department shall gather all claim information, except from those applicants granted a deadline extension, nolater than December 10, 2018.

The Department shall, as closely as possible, estimate the amount of the appropriation needed to be held in reserve for payments related to losses of livestock, poultry, nursery, bush, tree, and specialty crops for which losses will not be fully known or calculated.

The Department shall set aside funds as it deems appropriate based on the estimated percentage of these losses.

(4) Payments made under this program shall be made to the person who filed the Form 578 or Department form for claims related to agricultural commodity losses, or the person who received payment from the USDA Livestock Indemnity Program for claims related to livestock or poultry losses.

SECTION5.11.(i) The Department mayaudit thefinancialandotherrecordsofeach recipient of funds in order to ensure that the funds are used in accordance with the requirements of this program.

The Department may require any documentation or proof it considers necessary to efficiently administer this program, including the ownership structure of each entity and the social security numbers of each owner.

In order to verify losses, the Department may require the submission of dated, signed, and continuous records.

These records may include, but are not limited to, commercial receipts, settlement sheets, warehouse ledger sheets, pick records, load summaries, contemporaneous measurements, truck scale tickets, contemporaneous diaries, appraisals, ledgers of income, income statements of deposit slips, cash register tape, invoices for custom harvesting, u-pick records, and insurance documents.

SECTION5.11.(j) Awardedfundsshallbeusedforagriculturalproductionexpenses and recovery of losses due to the impacts of Hurricane Florence.

The Department shall develop guidelines and procedures to ensure that funds are expended for the purposes allowed by this section, and mayrequire anydocumentation it determines necessary to verify the appropriate use of financial assistance awards including receipts.

All distributed funds are subject to federal and State income tax.

SECTION 5.11.(k) If the Department determines that a person who received financial assistance provided inaccurate information, then the person shall refund the entire amount of the financial assistance.

If the person does not refund the appropriate amount, the North Carolina Department of Revenue shall collect the money from the person pursuant to G.S.

105-242.

SECTION 5.11.(l) This section expires January 1, 2024.

COASTAL DEBRIS CLEANUP Page 12 House Bill 3-Second Edition General Assembly Of North Carolina Third Extra Session 2018 SECTION 5.12.

Funds allocated in this act to the Department of Environmental Quality for coastal debris cleanup will be used to provide a grant to the North Carolina Coastal Federation to contract with third parties to remove and properly dispose of marine debris deposited in and adjacent to the waters of the State by Hurricane Florence.

The Federation shall not use any of the funds allocated to it by this section for administrative or overhead costs.

The Federation shall report on the use of the funds to the Joint Legislative Oversight Committee on Agriculture and Natural and Economic Resources, the Office of Recovery and Resiliency in the Department of Public Safety, and the Fiscal Research Division on or before April 1, 2019.

LIVING SHORELINES PERMIT REVISIONS SECTION 5.13.

The Coastal Resources Commission shall adopt temporary rules pursuant to G.S.

150B-21.1 to revise the Commission's general permit for the construction of riprap sills for wetland enhancement in estuarine and public trust waters (15A NCAC 07H .2700) (the Living Shorelines General Permit) in order to make the general permit consistent with the United States Army Corps of Engineers Wilmington District regional general permit for living shorelines.

The temporary rules adopted by the Commission shall not include any changes to the Living Shorelines General Permit that would delay or otherwise alter general permits issued by the Commission for other types of coastal erosion control structures, including bulkheads and other hardened structures.

FERRY FEES WAIVER/SECRETARY OF TRANSPORTATION SECTION 5.14.

G.S.

136-82 is amended by adding a new subsection to read:

"(b2) Emergency Suspension of Tolling.

– The Secretary of Transportation may suspend the collection of tolls for any ferry route serving an emergency area, as declared pursuant to G.S.

166A-19.20 or G.S.

166A-19.22, for the duration of the state of emergency." DOT REPORTING REQUIREMENTS SECTION 5.15.

The Department of Transportation shall report within 30 days of the end of each calendar quarter to the Office of Recovery and Resiliency in the Department of Public Safety on the use of the funds allocated from the Hurricane Florence Disaster Recovery Fund and all matching funds received from the federal government.

The report shall contain all of the following information itemized by DOT Highway Division and county:

(1) Project scope and ranking by priority;

total cost;

amount spent (federal and state);

project status including percentage complete and timeline;

the responsible entity, including names of private contractors;

and any issues encountered with overall project management and delivery.

(2) Thecash balance ofthe fund,theamount of funds expended,encumbered, and unencumbered.

CONSTRUCTION FEE MORATORIUM SECTION 5.16.(a) Notwithstanding any other provision of law, for any single commercial or residential project, the Department of Insurance, counties, and cities shall not impose any fee associated with a permit, inspection, or certificate of occupancy required by law for construction, reconstruction, alteration, repair, movement to another site, removal, or demolition of a manufactured home, building, dwelling, or structure damaged as a direct result of Hurricane Florence.

SECTION5.16.(b) Themoratoriumprovidedinsubsection(a)ofthissectionapplies in North Carolina counties designated under a major disaster declaration by the President of the United States under the Stafford Act (P.L.

A(2) personThe isstudent allowedhas acompleted refundas ofmuch anytime feein assesseda andclinical collectedinternship thatas ispracticable subjectduring to the moratorium imposed by House Bill 3-Second Edition Page 13 General Assembly Of North Carolina Third Extra Session 2018 thisfall section.academic semester.

(3) The Departmentstudent ofcannot Insurance,graduate counties,in andDecember cities2018 shallfrom postthe aEPP noticewithout of the availabilityclinical ofinternship arequirement refundbeing ondeemed theircompleted Webpursuant sites.to this section.

SECTION 5.16.(c)2.2. This section is effective when it becomes law and applies to applications for issuance of a permit dated on or after September 13, 2018.

ThisBy sectionFebruary expires1, December2019, 31,any 2018.EPP with an enrolled student who has his or her clinical internship requirement deemed completed pursuant to Section 2.1 of this act shall report to the State Board of Education with the following information:

7(1) EXCEPTIONNumber TOof CONFIDENTIALITYstudents OFwho TAXhad INFORMATIONthe SECTIONclinical 5.17.(a)internship G.S.requirement deemed completed.

105-259(b)(2) isReasons amendedfor bya addingclinical ainternship newrequirement subdivisionbeing todeemed read:completed.

"(55)(3) ToAmount provide data drawn from an individual taxpayer's tax information to the Office of Recoverytime andcompleted Resiliency for the purpose of facilitating such a taxpayer'sclinical applicationinternship. for any means-tested federal or state disaster relief following a federal major disaster declaration;

provided,(4) however,Any thatother no federal tax information mayrequired be disclosed under this subpart unless such a disclosure is permitted by section 6103 of the Code."State SECTIONBoard. 5.17.(b) The Department of Revenue and the Office of Recovery and Resiliency shall, within a reasonable time following the effective date of this act but not later than June 30, 2019, enter into a confidential information sharing agreement settling data transfer protocols, required security measures, audit mechanisms, and other issues necessary to develop and implement the information exchange provided in subsection (a) of this section.

EXPANDBy ELIGIBILITYMarch FOR15, DISASTER2019, HOUSINGthe ASSISTANCEState SECTIONBoard 5.18.of Education shall report to the Joint Legislative Education Oversight Committee on the information reported to the State Board by EPPs under this section.

NotwithstandingPART G.S.III.

122E-6(a)EFFECTIVE andDATE (b)SECTION and3. the provisions of G.S.

122E-6This relating to income limitations of individuals and families, funds allocated in this act tois theeffective Northwhen Carolinait Housingbecomes Financelaw. Agency for eligible projects under Chapter 122E of the General Statutes in counties impacted by Hurricane Matthew or Hurricane Florence may be used to assist individuals and families with household incomes that equal, but do not exceed, one hundred percent (100%) of the local area's median income, adjusted for family size, pursuant to the most recent available data from the United States Department of Housing and Urban Development.

AUDITHouse OFBill HURRICANE3-First FLORENCEEdition DISASTERPage RECOVERY3 FUND SECTION 5.19.

The State Auditor shall conduct a preliminary financial and performance audit of the Hurricane Florence Disaster Recovery Fund created in Section 3.1 of S.L.

2018-134 (Fund) no later than March 1, 2019.

The State Auditor shall conduct additional periodic financial and performance audits of the Fund and a final financial and performance audit as requested by the Director of the Budget and the General Assembly.

DEPARTMENT OF INSURANCE REPORTING SECTION 5.20.

The Department of Insurance shall report to the Office of Recovery and Resiliency in the Department of Public Safety and the Fiscal Research Division on the funds allocated to it by this act for grants to volunteer fire departments.

The report shall include the number of applications received, the number of grantees denied funding, and the amounts awarded to each grantee.

The Department shall report within 30 days of the end of each calendar quarter until all funds allocated to the Department have been expended or have reverted.

INVOLVEMENT OF HISTORICALLY UNDERUTILIZED BUSINESSES SECTION 5.21.

It is the intent of the General Assembly that, during this time of rebuilding and relief efforts, each State agency should strive to acquire goods and services from historicallyunderutilized business vendors, whether directlyas principal contractors or indirectly as subcontractors or otherwise.

Page 14 House Bill 3-Second Edition General Assembly Of North Carolina Third Extra Session 2018 2 LEGISLATIVE REVIEW OF FEDERAL FUNDING AND REMAINING UNMET NEEDS SECTION 5.22.

It is the intent of the General Assembly to review in 2018 and 2019 the funds appropriated by Congress for disaster relief and to consider actions needed to address any remaining unmet needs.

It is also the intent of the General Assembly to review the adequacy of the measures funded by Section 2.1 of this act at that time.

9 PROHIBITION ON USE OF STATE FUNDS TO CONSTRUCT CERTAIN RESIDENCES SECTION 5.23.(a) No State funds appropriated in this act may be expended for the construction of any new residence within the 100-year floodplain unless the construction is in an area regulated by a unit of local government pursuant to a floodplain management ordinance and the construction complies with the ordinance.

For purposes of this act, the term "100-year floodplain" means any area subject to inundation by the one percent (1%) annual chance flood event, as indicated on the most recent Flood Insurance Rate Map prepared by the Federal Emergency Management Agency under the National Flood Insurance Program.

SECTION 5.23.(b) Homeowners in the 100-year floodplain who receive homeowner's housing assistance pursuant to this act shall have in effect federal flood insurance, if available, as a precondition to receipt of State homeowner's housing assistance for losses resulting from future flooding.

SECTION 5.23.(c) Funds loaned to small and mid-sized businesses shall be used only for eligible purposes under the Small Business Administration (SBA) disaster loan assistance program, as described in the federal disaster declarations designated by the SBA as NC 14911 and NC 14912.

Payments for economic losses shall be limited todocumented business expenses necessary for the continued operation of the business.

SUBROGATION BY STATE OF RIGHT TO INSURANCE COVERAGE FOR DAMAGED HOMES PURCHASED OR RELOCATED UNDER THE HAZARD MITIGATION PROGRAM SECTION 5.24.

If a person's home is relocated or purchased with funds from the Hazard Mitigation Grant Program or the State Acquisition and Relocation Fund, the State Emergency Response and Disaster Relief Fund is subrogated to the person's rights under any insurance coverage for the damage to the home, and any monies received from the insurance coverage shall be paid to the State Emergency Response and Disaster Relief Fund.

The Division ofEmergencyManagement shall ensurethatthosepotentiallyaffectedbythis section arenotified of, and adhere to, its requirements.

PART VI.

MISCELLANEOUS PROVISIONS COMMITTEE REPORT SECTION 6.1.

The document titled N.C.

Senate Committee on Appropriations/Base Budget and N.C.

House of Representatives Committee on Appropriations Committee Report on Hurricane Florence Disaster Recovery Fund for Senate Bill 3 and House Bill 3 (Committee Report) dated October 15, 2018, which was distributed in the Senate and the House of Representatives and used to explain this act, shall indicate action by the General Assembly on this act and shall, therefore, be used to construe this act, and for these purposes shall be considered a part of this act and, as such, shall be printed as a part of the Session Laws.

If the Committee Report conflicts with this act, the act prevails.

EFFECT OF HEADINGS House Bill 3-Second Edition Page 15 General Assembly Of North Carolina Third Extra Session 2018 SECTION 6.2.

The headings to the parts, subparts, and sections of this act are a convenience to the reader and are for reference only.

The headings do not expand, limit, or define the text of this act, except for effective dates referring to a part or subpart.

5 SEVERABILITY CLAUSE SECTION 6.3.

If any section or provision of this act is declared unconstitutional or invalid by the courts, it does not affect the validity of this act as a whole or any part other than the part so declared to be unconstitutional or invalid.

PART VII.

EFFECTIVE DATE SECTION 7.1.

Except as otherwise provided, this act is effective when it becomes law.

Page 16 House Bill 3-Second Edition