General Assembly sends first 2017 bill to governor

Republican-sponsored H.B. 39 would reduce the membership of the UNC Board of Governors from 32 to 24 by 2019 and could face veto amid Democrat opposition


RALEIGH — Having technically convened the 2017 legislative session weeks ago, revving engines gave way to traction as the North Carolina General Assembly passed its first bill of the year Monday evening with the N.C. Senate voting to send University of North Carolina system Board of Governors reform legislation to Gov. Roy Cooper. House Bill 39 would reduce the membership of the board from 32 to 24 members by 2019.

Republicans are seeking to reduce the number of board seats with the support of UNC System President Margaret Spellings in an effort they say reflects modern corporate governance and efficiency needs.

“It reduces the board down to a manageable number and it’s being done all across this country,” said Sen. Bill Rabon (R-Southport). “Any nonprofit, any business you can think of, most of the success stories talk about how lowering the size of their board created success, and that’s exactly what we’re trying to do here.”

Several Democratic senators opposed to the bill feared it reduced diversity, offering an amendment that would give the General Assembly authority to fill select seats on the new board structure to satisfy specifically designated categories, for instance a graduate of a historically black college or university or a particular party affiliation.

“There is a narrowness of point of view with respect to representation,” said amendment sponsor Sen. Angela Bryant (D-Rocky Mount). “A governing board is there both for governance and for representation of the constituencies that are subject to that board.”

In a clever response, Sen. Ralph Hise (R-Spruce Pine) offered an amendment to expand political affiliation quotas beyond the board to all faculty across the system, drawing laughs from both sides of the aisle.

“What we find over and over and over again with our faculty is there is a lack of diversity of thought,” said Hise. In seriousness, Hise later remarked that, “No matter what discussions we’ve had, this bill is about should the board of governors be 32 to 24 members. That’s it.”

Sen. Wesley Meredith (R-Fayetteville) asserted that all the university system’s constituencies are already fully represented by the hierarchy of governance in place.

“I think it’s very important that we all remember that there’s a chancellor, there’s a board of trustees for each on of these colleges that is banging the drum and blowing the horn every day,” said Meredith. “How can we say that these universities are not going to be represented?”

Supporters of the reduction argue that an entity such as the UNC System adapt to best practices in corporate governance in an effort to streamline decision-making and drive efficiency. They note that leading corporations have comparatively small boards and cite studies that suggests maximum utility for such nonprofit boards is approximately 13-15 members.

“I can tell you a number of boards that I’ve served on, 32 [board members] would be unwieldy,” said Sen. Tommy Tucker (R-Union). “Just to give you one example; Apple, which has a $775 billion market cap, has eight members to its board.”

Despite the healthy floor debate, H.B. 39 passed the N.C. Senate and was order enrolled. The bill will be the first presented to Cooper from the Republican supermajorities in the state legislature and may be at some risk of veto. Though many Democrats oppose the reduction of the board as a threat to diverse representation, Cooper may ultimately keep his veto pen out of the ink well.

The fact that Spellings has been publicly supportive of the bill and the likelihood that among forthcoming legislation there will be bills more upsetting to partisan sensibilities than H.B. 39, makes a case for the governor keeping his powder dry for now. To wit, Republicans in the legislature have sufficient override votes if Cooper does decide to veto the bill.

Now that the seal is broken, the General Assembly is likely to send a slew of bills to the governor’s desk in coming days and weeks. Multiple appropriations committees met Tuesday to review funding details in anticipation of receiving Cooper’s full budget recommendations by early March. A piece of that budget was revealed Monday when Cooper unveiled a teacher pay raise proposals contained therein.


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