GENERAL ASSEMBLY OF NORTH CAROLINA
SESSION 2025
H 1
HOUSE BILL 135
Short Title: Misbranding/Cell-Cultured Meat/Env. Assess. (Public)
Sponsors: Representatives McNeely, Humphrey, Lowery, and K. Hall (Primary Sponsors).
For a complete list of sponsors, refer to the North Carolina General Assembly web site.
Referred to: Finance, if favorable, Health, if favorable, Commerce and Economic
Development, if favorable, Agriculture and Environment, if favorable, Rules,
Calendar, and Operations of the House
February 18, 2025
*H135 -v-1*
A BILL TO BE ENTITLED 1
AN ACT TO PROHIBIT THE MISBRANDING OF CE RTAIN FOOD PRODUCTS; TO 2
PROHIBIT COMMUNITY C OLLEGES, UNIVERSITIES, AND PUBLIC SCHOOL S 3
FROM PURCHASING CERT AIN FOOD PRODUCTS; A ND TO ESTABLISH AN 4
ENVIRONMENTAL INVEST MENT ASSESSMENT ON C ERTAIN MEAT, POULTRY, 5
EGG, AND DAIRY PRODUCTS AND ANALOGOUS PR ODUCTS. 6
The General Assembly of North Carolina enacts: 7
8
REQUIRE LABELING OF MANUFACTURED -PROTEIN PRODUCTS 9
SECTION 1.(a) G.S. 106-549.15 reads as rewritten: 10
"§ 106-549.15. Definitions. 11
As used in this Article, except as otherwise specified, the following terms shall have the 12
meanings stated below: 13
… 14
(1a) "Agricultural food animal" means a domesticated animal belonging to the 15
bovine, caprine, ovine, or porcine species. 16
… 17
(5a) "Cell-cultured food product" means a food product having one or more 18
sensory attributes that resemble a type of tissue originating from an 19
agricultural food animal but that, in lieu of being derived from meat 20
processing, is derived from manufacturing cells, in which one or more stem 21
cells are initially isolated from an agricultural food animal, are grown in vitro, 22
and may be manipulated, as part of a manufacturing operation. 23
(5b) "Close proximity" means any of the following: 24
a. Immediately before or after the name of the product. 25
b. In the line of the label immediately before or after the line containing 26
the name of the product. 27
c. Within the same phrase or sentence containing the name of the 28
product. 29
… 30
(9a) "Identifying meat term" means any word or phrase that states, indicates, 31
suggests, or describes a meat product, regardless of whether the word or 32 General Assembly Of North Carolina Session 2025
Page 2 House Bill 135-First Edition
phrase is used individually, as a portmanteau, or as a compound word. This 1
term includes all of the following: 2
a. A common name for the species of the agricultural food animal subject 3
to slaughter and processing, including a calf or cow, goat or kid, hog 4
or pig, or lamb or sheep. 5
b. A common name for a characteristic of a species of the agricultural 6
food animal subject to slaughter and processing based on age, breed, 7
or sex. 8
c. Meat, beef or veal, cabrito or chevon, lamb or mutton, or pork. 9
d. A common name used to describe a major cut of a meat of an 10
agricultural food animal slaughtered and processed, including a major 11
meat cut specified in 9 C.F.R. § 317.344, or the common name of an 12
organ or offal, including heart, liver, kidney, or tongue. 13
e. Any other common name that a reasonable purchaser would 14
immediately and exclusively associate with a meat product prepared 15
for sale in normal commercial channels such as bacon, baloney, 16
bologna, bone, brat or bratwurst, brisket, burger or hamburger, butt, 17
chop, chuck, cold cut, cutlet, filet, flat iron, frank or frankfurter, ham, 18
hock, hot dog, jerky, liverwurst, loin, London broil, lunch meat, New 19
York strip, pepperoni, porterhouse, ribeye, roast, rib or sparerib, 20
salami, sausage, shank, sirloin, tenderloin, or a comparable word or 21
phrase. 22
(9b) "Insect-protein food product" means a food product having one or more 23
sensory attributes that resemble a type of tissue originating from an 24
agricultural food animal but that, in lieu of being derived from meat 25
processing, is derived from manufacturing insect parts. 26
… 27
(12a) "Manufactured-protein food product" means a cell-cultured food product, 28
insect-protein food product, or plant-protein food product. 29
… 30
(14) "Meat food product" means any product capable of use as human food that is 31
made wholly or in part from any meat or other portion of the carcass of any 32
cattle, sheep, swine, goats, bison, fallow deer, or red deer, or any cell-cultured 33
product made from cells of those animals, excepting products that contain 34
meat or other portions of such carcasses only in a relatively small proportion 35
or historically have not been considered by consumers as products of the meat 36
food industry, and that are exempted from definition as a meat food product 37
by the Board under such conditions as it may prescribe to assure that the meat 38
or other portions of such carcasses contained in such product are not 39
adulterated and that such products are not represented as meat food products. 40
This term as applied to food products of equines shall have a meaning 41
comparable to that provided in this subdivision with respect to cattle, sheep, 42
swine, goats, and bison. 43
(15) "Misbranded" shall apply to any carcass, part thereof, meat or meat food 44
product under one or more of the following circumstances: 45
a. If its labeling is false or misleading in any particular; 46
b. If it is offered for sale under the name of another food; 47
c. If it is imitation of another food, unless its label bears, in type of 48
uniform size and prominence, the word "imitation" and immediately 49
thereafter, the name of the food imitated; 50
… 51 General Assembly Of North Carolina Session 2025
House Bill 135-First Edition Page 3
m. The product is a cell-cultured product, and it is not labeled in 1
accordance with G.S. 106-549.28A. 2
… 3
(20a) "Plant-protein food product" means a food product having one or more 4
sensory attributes that resemble a type of tissue originating from an 5
agricultural food animal but that, in lieu of being derived from meat 6
processing, is derived from manufacturing plant or fungus parts. 7
… 8
(21a) "Qualifying term" means a word, compound word, or phrase that would 9
clearly disclose to a reasonable purchaser of meat products that a food product 10
is not a meat product. This includes the following terms: "cell-cultured," 11
"fake," "grown in a lab," "insect," "insect-based," "insect-protein," 12
"lab-created," "lab-grown," "meat free," "meatless," "plant," "plant-based," 13
"vegan," "vegetable," "vegetarian," or "veggie." 14
(21b) "Ratite" means a bird whose breastbone is smooth so that flight muscles 15
cannot attach, such as an ostrich, an emu, and a rhea. These birds are subject 16
to the provisions of this Article and Article 49C to the same extent as any other 17
meat food product. 18
…." 19
SECTION 1.(b) Article 49B of Chapter 106 of the General Statutes is amended by 20
adding a new section to read: 21
"§ 106-549.28A. Labeling of manufactured-protein food products. 22
(a) The label of any manufactured-protein food product that contains an identifying meat 23
term shall also contain in at least 20-point font or the size of the surrounding type, whichever is 24
greater, and in close proximity to the name of the product, an appropriate qualifying term. 25
(b) A manufactured-protein food product that does not meet the requirements of this 26
section shall be deemed misbranded for purposes of this Article." 27
SECTION 1.(c) G.S. 106-549.51 reads as rewritten: 28
"§ 106-549.51. Definitions. 29
For purposes of this Article, the following terms shall have the meanings stated below: 30
… 31
(4a) "Cell-cultured food product" means a food product having one or more 32
sensory attributes that resemble a type of tissue originating from poultry but 33
that, in lieu of being derived from meat processing, is derived from 34
manufacturing cells, in which one or more stem cells are initially isolated from 35
poultry, are grown in vitro, and may be manipulated, as part of a 36
manufacturing operation. 37
(4b) "Close proximity" means any of the following: 38
a. Immediately before or after the name of the product. 39
b. In the line of the label immediately before or after the line containing 40
the name of the product. 41
c. Within the same phrase or sentence containing the name of the 42
product. 43
… 44
(10a) "Identifying poultry term" means any word or phrase that states, indicates, 45
suggests, or describes a poultry product, regardless of whether the word or 46
phrase is used individually, as a portmanteau, or as a compound word. This 47
term includes all of the following: 48
a. A common name for the species of the poultry subject to slaughter and 49
processing, including chicken, poultry, or turkey. 50 General Assembly Of North Carolina Session 2025
Page 4 House Bill 135-First Edition
b. A common name for a characteristic of a species of the poultry subject 1
to slaughter and processing based on age, breed, or sex. 2
c. Meat, broiler, fryer, poulet, or yearling. 3
d. A common name used to describe a major cut of poultry slaughtered 4
and processed, including a poultry product such as breast, drumstick, 5
giblet, thigh, or wing; or the common name of an organ or offal, 6
including gizzard, heart, liver, kidney, or tongue. 7
e. Any other common name that a reasonable purchaser would 8
immediately and exclusively associate with a poultry product prepared 9
for sale in normal commercial channels. 10
… 11
(11a) "Insect-protein food product" means a food product having one or more 12
sensory attributes that resemble a type of tissue originating from poultry but 13
that, in lieu of being derived from meat processing, is derived from 14
manufacturing insect parts. 15
… 16
(16a) "Manufactured-protein food product" means a cell-cultured food product, 17
insect-protein food product, or plant-protein food product. 18
(17) "Misbranded" shall apply to any poultry product under one or more of the 19
following circumstances: 20
a. If its labeling is false or misleading in any particular; 21
b If it is offered for sale under the name of another food; 22
c. If it is an imitation of another food, unless its label bears, in type of 23
uniform size and prominence, the word "imitation" and immediately 24
thereafter, the name of the food imitated; 25
… 26
m. If it is a manufactured-protein food product and it is not labeled in 27
accordance with G.S. 106-549.55(e). 28
… 29
(24a) "Plant-protein food product" means a food product having one or more 30
sensory attributes that resemble a type of tissue originating from poultry but 31
that, in lieu of being derived from meat processing, is derived from 32
manufacturing plant or fungus parts. 33
… 34
(26) "Poultry product" means any poultry carcass, or part thereof; or any product 35
which is made wholly or in part from any poultry carcass or part thereof, or 36
any cell-cultured food product made from cells of poultry, excepting products 37
which contain poultry ingredients only in a relatively small proportion or 38
historically have not been considered by consumers as products of the poultry 39
food industry, and which are exempted by the Board from definition as a 40
poultry product under such conditions as the Board may prescribe to assure 41
that the poultry ingredients in such products are not adulterated and that such 42
products are not represented as poultry products. 43
… 44
(28a) "Qualifying term" means a word, compound word, or phrase that would 45
clearly disclose to a reasonable purchaser of poultry products that a food 46
product is not a poultry product. This includes the following terms: 47
"cell-cultured," "fake," "grown in a lab," "insect," "insect-based," 48
"insect-protein," "lab-created," "lab-grown," "meat free," "meatless," "plant," 49
"plant-based," "vegan," "vegetable," "vegetarian," or "veggie." 50
…." 51 General Assembly Of North Carolina Session 2025
House Bill 135-First Edition Page 5
SECTION 1.(d) G.S. 106-549.55 reads as rewritten: 1
"§ 106-549.55. Labeling standards; false and misleading labels.labels; labeling of 2
manufactured-protein food products. 3
… 4
(e) The label of any manufactured-protein food product that contains an identifying 5
poultry term shall also contain in at least 20-point font or the size of the surrounding type, 6
whichever is greater, and in close proximity to the name of the product, an appropriate qualifying 7
term." 8
SECTION 1.(e) This section becomes effective October 1, 2025, and applies to 9
products sold or offered for sale on or after that date. 10
11
PROHIBIT COMMUNITY COLLEGES, PUBLIC UNIVERSITIES, AND PUBLIC 12
SCHOOLS FROM PURCHASING MISBRANDED PRODUCTS AND 13
CELL-CULTURED PRODUCTS 14
SECTION 2.(a) G.S. 115C-12 is amended by adding a new subdivision to read: 15
"(50) Purchases of meat and poultry products. – The State Board of Education shall 16
establish policies to prevent the purchase of a food product that is any of the 17
following: 18
a. Misbranded as a meat or poultry product as prohibited in Articles 49B 19
and 49D of Chapter 106 of the General Statutes. 20
b. A cell-cultured food product as defined in G.S. 106-549.15 or 21
G.S. 106-549.51." 22
SECTION 2.(b) Part 2 of Article 17 of Chapter 115C of the General Statutes is 23
amended by adding a new section to read: 24
"§ 115C-264.6. Purchases of meat and poultry products. 25
Local boards of education shall establish policies to prevent the purchase of a food product 26
that is any of the following: 27
(1) Misbranded as a meat or poultry product as prohibited in Articles 49B and 28
49D of Chapter 106 of the General Statutes. 29
(2) A cell-cultured food product as defined in G.S. 106-549.15 or 30
G.S. 106-549.51." 31
SECTION 2.(c) G.S. 115C-218.75 is amended by adding a new subsection to read: 32
"(p) Purchases of Meat and Poultry Products. – A charter school shall establish policies to 33
prevent the purchase of a food product that is any of the following: 34
(1) Misbranded as a meat or poultry product as prohibited in Articles 49B and 35
49D of Chapter 106 of the General Statutes. 36
(2) A cell-cultured food product as defined in G.S. 106-549.15 or 37
G.S. 106-549.51." 38
SECTION 2.(d) G.S. 115C-238.66 is amended by adding a new subdivision to read: 39
"(23) Purchases of meat and poultry products. – A regional school shall establish 40
policies to prevent the purchase of a food product that is any of the following: 41
a. Misbranded as a meat or poultry product as prohibited in Articles 49B 42
and 49D of Chapter 106 of the General Statutes. 43
b. A cell-cultured food product as defined in G.S. 106-549.15 or 44
G.S. 106-549.51." 45
SECTION 2.(e) G.S. 116-239.8(b)(4)c. reads as rewritten: 46
"c. Food services. – The laboratory school shall strive to ensure that one 47
hundred percent (100%) muscadine grape juice is made available to 48
students as a part of the school's nutrition program or through the 49
operation of the school's vending facilities. The laboratory school shall 50
establish policies to prevent the purchase of a food product that is (i) 51 General Assembly Of North Carolina Session 2025
Page 6 House Bill 135-First Edition
misbranded as a meat or poultry product as prohibited in Articles 49B 1
and 49D of Chapter 106 of the General Statutes or (ii) cell-cultured 2
food product as defined in G.S. 106-549.15 or G.S. 106-549.51. Upon 3
request, the local school administrative unit in which the laboratory 4
school is located shall administer the National School Lunch Program 5
for the laboratory school in accordance with G.S. 115C-264." 6
SECTION 2.(f) G.S. 115D-20 reads as rewritten: 7
"§ 115D-20. Powers and duties of trustees. 8
The trustees of each institution shall constitute the local administrative board of such 9
institution, with such powers and duties as are provided in this Chapter and as are delegated to it 10
by the State Board of Community Colleges. The powers and duties of trustees shall include the 11
following: 12
… 13
(16) To establish policies to prevent the purchase of a food product that is any of 14
the following: 15
a. Misbranded as a meat or poultry product as prohibited in Articles 49B 16
and 49D of Chapter 106 of the General Statutes. 17
b. A cell-cultured food product as defined in G.S. 106-549.15 or 18
G.S. 106-549.51." 19
SECTION 2.(g) Part 5 of Article 1 of Chapter 116 of the General Statutes is amended 20
by adding a new section to read: 21
"§ 116-43.26. Purchases of meat and poultry products. 22
Each constituent institution shall establish policies to prevent the purchase of a food product 23
that is any of the following: 24
(1) Misbranded as a meat or poultry product as prohibited in Articles 49B and 25
49D of Chapter 106 of the General Statutes. 26
(2) A cell-cultured food product as defined in G.S. 106-549.15 or 27
G.S. 106-549.51." 28
SECTION 2.(h) This section becomes effective October 1, 2025. Subsections (a), 29
(b), (c), (d), and (e) of this section apply beginning with the 2026-2027 school year. Subsections 30
(f) and (g) of this section apply beginning with the 2026-2027 academic year. 31
32
ESTABLISH AN ENVIRONMENTAL INVESTMENT ASSESSMENT ON CERTAIN 33
MEAT, POULTRY, EGG, AND DAIRY PRODUCTS AND ANALOGOUS PRODUCTS 34
SECTION 3.(a) Subchapter I of Chapter 105 of the General Statutes is amended by 35
adding a new Article to read: 36
"Article 5K. 37
"Animal Agriculture and Analogues Environmental Investment Assessment. 38
"§ 105-187.100. Definitions. 39
The following definitions apply in this Article: 40
(1) Agricultural food animal. – A domesticated animal belonging to the bovine, 41
caprine, ovine, or porcine species; a domesticated animal belonging to the 42
cervid species limited to fallow deer or red deer; and domestic fowl limited to 43
chickens or turkeys. 44
(2) Analogue product. – A food product derived by combining processed plant 45
products, insects, or fungi with food additives to approximate the texture, 46
flavor, appearance, or other aesthetic qualities or the chemical characteristics 47
of any specific type of animal agriculture product. This term includes 48
cell-cultured products. 49 General Assembly Of North Carolina Session 2025
House Bill 135-First Edition Page 7
(3) Animal agriculture product. – A food product that is a dairy product, egg, egg 1
product, meat, meat food product, poultry, or poultry product. This term does 2
not include an analogue product. 3
(4) Cell-cultured product. – A food product derived by harvesting animal cells 4
and artificially replicating those cells in a growth medium in a laboratory or 5
similar setting to produce tissue. 6
(5) Dairy product. – A product manufactured for human consumption that is 7
derived from the processing of milk. The term includes a fluid milk product. 8
(6) Dietary supplement. – As defined in G.S. 105-164.3(55). 9
(7) Egg. – As defined in 21 U.S.C. § 1033(g). 10
(8) Egg product. – As defined in 21 U.S.C. § 1033(f). 11
(9) Environmental improvement project. – A project that is intended to improve 12
water quality, increase soil health, reduce flood risks, reduce chemical inputs, 13
increase biodiversity, preserve farmland, or achieve similar ecological goals. 14
(10) Fluid milk product. – A milk product normally consumed in liquid form as a 15
beverage. 16
(11) Food product. – A perishable or nonperishable product that is fit for human 17
consumption. This term does not include dietary supplements. 18
(12) Identifying term. – Any word or phrase that states, indicates, or describes an 19
animal agriculture product, regardless of whether the word is used 20
individually, as a compound word, or as a portmanteau. 21
a. An "identifying term" includes all of the following: 22
1. A common name for the species of an agricultural food animal 23
subject to slaughter and processing, including a calf or cow, 24
chicken, goat or kid, hog or pig, poultry, lamb or sheep, or 25
turkey. 26
2. A common name for a characteristic of a species of an 27
agricultural food animal subject to slaughter and processing, 28
based on age, breed, or sex. 29
3. Any of the terms: beef or veal; egg; broiler, fryer, poulet, or 30
yearling; cabrito or chevon; lamb or mutton; meat; milk; or 31
pork. 32
4. A common name used to describe a major cut of a meat of an 33
agricultural food animal slaughtered and processed, including 34
a major meat cut specified in 9 C.F.R. § 317.344; a poultry 35
product such as breast, drumstick, giblet, thigh, or wing; or the 36
common name of an organ or offal, including gizzard, heart, 37
liver, kidney, or tongue. 38
5. Any other common name that a reasonable purchaser would 39
immediately associate with a dairy, egg, meat, or poultry 40
product prepared for sale in normal commercial channels, such 41
as bacon, baloney, bologna, bone, brat or bratwurst, brisket, 42
burger or hamburger, butt, butter, cheese, chop, chuck, cold 43
cut, cream, cutlet, filet, flat iron, frank or frankfurter, 44
half-and-half, ham, hock, hot dog, ice cream, jerky, liverwurst, 45
loin, London broil, lunch meat or lunchmeat, New York strip, 46
pepperoni, porterhouse, ribeye, roast, rib or sparerib, salami, 47
sausage, scramble, shank, sirloin, tenderloin, yogurt, or a 48
comparable word or phrase. 49 General Assembly Of North Carolina Session 2025
Page 8 House Bill 135-First Edition
b. An "identifying term" shall not include a product name that is 1
understood by consumers not to be a term for an animal agriculture 2
product or an analogue product. 3
(13) Label. – A display of written, printed, or graphic matter placed upon any 4
container storing a food product that is offered for sale or sold at retail, 5
regardless of whether the written, printed, or graphic matter is printed on the 6
container's packaging or a sticker affixed to the container. This does not 7
include a nutrition facts panel or ingredients list required by the United States 8
Food and Drug Administration. 9
(14) Meat. – As defined in 9 C.F.R. § 301.2. 10
(15) Meat food product. – Any product capable of use as human food that is made 11
wholly or in part from any meat or other portion of the carcass of any cattle, 12
sheep, swine, goat, bison, fallow deer, or red deer. For purposes of this section, 13
the following are considered meat food products: 14
a. Primal and subprimal cuts of meat. 15
b. Ground meat. 16
c. Sliced deli meat. 17
d. Sausage. 18
e. Bacon. 19
f. Ham. 20
g. Jerky. 21
h. Corned beef. 22
i. Smoked parts. 23
j. Rendered fats. 24
k. Edible offal. 25
(16) Milk. – The lacteal secretion practically free from colostrum obtained by the 26
milking of one or more cows, goats, or other lactating animals. 27
(17) Poultry. – As defined in 21 U.S.C. § 453(e). 28
(18) Poultry product. – As defined in 21 U.S.C. § 453(f). For purposes of this 29
section, the following are considered poultry products: 30
a. Whole poultry. 31
b. Primal cuts of poultry. 32
c. Ground poultry. 33
d. Sliced deli poultry. 34
e. Sausage. 35
f. Bacon. 36
g. Jerky. 37
h. Smoked parts. 38
i. Rendered fats. 39
j. Edible offal. 40
(19) Prepared food. – As defined in G.S. 105-164.4L. 41
(20) Protein group. – The type of protein from which an animal agriculture product 42
was derived or which an analogue product approximates or is intended to 43
approximate. A meat food product or poultry product shall be classified based 44
on the animal from which the meat was derived, and an analogue to a meat 45
food product or poultry product shall be classified based on the specific animal 46
protein approximated or intended to be approximated. 47
(21) Trade associations. – All of the following organizations: 48
a. North Carolina Cattleman's Association. 49
b. North Carolina Dairy Producers Association. 50
c. North Carolina Deer and Elk Farmers Association. 51 General Assembly Of North Carolina Session 2025
House Bill 135-First Edition Page 9
d. North Carolina Egg Association. 1
e. North Carolina Pork Council. 2
f. North Carolina Poultry Federation. 3
g. North Carolina Sheep Producers Association. 4
"§ 105-187.101. Environmental investment assessment imposed. 5
(a) Levy and Rate. – An environmental investment assessment (EIA) of five cents (5¢) 6
is imposed on each item of an animal agriculture product or an analogue product sold at retail if 7
the article bears an identifying term on the product's label. For purposes of this Article, the term 8
"item" refers to an item that is identified by a universal product code or other identifier 9
representing the item and that is used to retrieve the sales price of the item. 10
(b) Environmental Investment Assessment – The EIA imposed by this Article is intended 11
to be passed on to the purchaser of an item to which the EIA is imposed and borne by the 12
purchaser instead of by the retailer. A retailer must collect the EIA due on an item when sold at 13
retail. A retailer must record the protein group to which any animal agriculture product or 14
analogue product belongs and report this information to the Department of Revenue when it 15
remits the collected EIAs to the Department. If the retailer cannot determine the protein group to 16
which an animal agriculture product or analogue product belongs, the retailer shall consult with 17
the trade association with which the product would be most closely identified. The trade 18
association shall make the determination of whether the product should be subject to the 19
assessment and notify the Department. 20
(c) The retailer may retain one percent (1%) of the gross proceeds of the EIAs it collects 21
for the retailer's administrative costs. The EIA is a debt from the purchaser to the retailer until 22
paid and is recoverable at law by the retailer in the same manner as other debts. A retailer is 23
considered to act as a trustee on behalf of the State when it collects the EIA from the purchaser 24
on an applicable sale. The EIA must be stated and charged separately on the invoices or other 25
documents of the retailer given to the purchaser at the time of the sale except for either of the 26
following: 27
(1) Vending machine sales. 28
(2) Where a retailer displays a statement indicating the sales price includes the 29
tax. 30
"§ 105-187.102. Administration. 31
Except as otherwise provided in this Article, the EIA imposed by this Article shall be 32
collected and administered in the same manner as the State sales and use taxes imposed by Article 33
5 of this Chapter. The provisions of Article 9 of this Chapter that are not inconsistent with this 34
Article, including administration, auditing, making returns, promulgation of rules and regulations 35
by the Secretary, additional taxes, assessments and assessment procedure, imposition and 36
collection of taxes and the lien thereof, and penalties, are made a part of this Article and shall be 37
applicable thereto. 38
"§ 105-187.103. Exemptions and refunds. 39
(a) The EIA imposed by this Article does not apply to any of the following: 40
(1) Sales the State cannot constitutionally tax. 41
(2) Products of a farm sold in their original state by the producer of the products 42
if the producer is not primarily a retail merchant. 43
(3) Prepared food. 44
(4) Products containing ingredients from more than one protein group. 45
(5) Meat food products or poultry products with a nonmeat or nonpoultry 46
component other than seasoning, brine solution, or vinegar, or analogue 47
products to such meat food products or poultry products. 48
(b) Except as otherwise provided in this section, the exemptions and refunds allowed in 49
Article 5 of this Chapter do not apply to sales of items subject to assessment under this Article. 50
"§ 105-187.104. Use of EIA proceeds. 51 General Assembly Of North Carolina Session 2025
Page 10 House Bill 135-First Edition
(a) Two percent (2%) of the net proceeds of the EIAs shall be retained by the Department 1
of Revenue for its administrative costs. 2
(b) Of the remaining funds, each quarter, the Secretary shall credit the net proceeds of 3
the EIAs collected under this Article to the trade associations proportionate to the amount of 4
funds collected from the sale of products in each protein group. 5
(c) Two percent (2%) of the funds credited to each trade association pursuant to this 6
section shall be used for the costs of administering the grant program authorized by this section. 7
The remainder of the funds credited to the trade associations may be used only to implement 8
environmental improvement projects on the farms of constituent members of the trade 9
associations. Each trade association shall develop (i) an application process by which constituent 10
members may apply for funds for environmental improvement projects and (ii) a process for 11
evaluating applications. In developing their processes, the trade associations shall consider the 12
size of the operations applying for funds and strive to award equal amounts of funding to small 13
and large operations. Any funds credited to the trade associations that are not awarded by a trade 14
association for 18 months shall be remitted to the Agricultural Development and Farmland 15
Preservation Trust Fund." 16
SECTION 3.(b) This section becomes effective October 1, 2025, and applies to 17
products sold on or after that date. 18
19
SEVERABILITY CLAUSE AND EFFECTIVE DATE 20
SECTION 4.(a) If any section or provision of this act is declared unconstitutional or 21
invalid by the courts, it does not affect the validity of this act as a whole or any part other than 22
the part declared to be unconstitutional or invalid. 23
SECTION 4.(b) Except as otherwise provided, this act becomes effective October 24
1, 2025. 25