GENERAL ASSEMBLY OF NORTH CAROLINA
SESSION 2025
H 1
HOUSE BILL 549
Short Title: Clarify Powers of State Auditor. (Public)
Sponsors: Representatives B. Jones, Setzer, Torbett, and Kidwell (Primary Sponsors).
For a complete list of sponsors, refer to the North Carolina General Assembly web site.
Referred to: Judiciary 1, if favorable, State and Local Government, if favorable, Rules,
Calendar, and Operations of the House
March 31, 2025
*H549 -v-1*
A BILL TO BE ENTITLED 1
AN ACT TO CLARIFY THE POWERS OF THE STATE AUDITOR AND TO MAKE OTHER 2
CHANGES RELATED TO THE STATE AUDITOR. 3
The General Assembly of North Carolina enacts: 4
5
PART I. CLARIFY POWERS OF STATE AUDITOR 6
SECTION 1. G.S. 143-64.24 reads as rewritten: 7
"§ 143-64.24. Applicability of Article. 8
This Article shall does not apply to the following agencies: 9
… 10
(10) The Office of the State Auditor." 11
SECTION 2. G.S. 143B-1320(b) reads as rewritten: 12
"(b) Exemptions. – Except as otherwise specifically provided by law, the provisions of 13
this Chapter do this Article does not apply to the following entities: the General Assembly, the 14
Judicial Department, and The University of North Carolina and its constituent institutions. 15
institutions, and the Office of the State Auditor. These entities may elect to participate in the 16
information technology programs, services, or contracts offered by the Department, including 17
information technology procurement, in accordance with the statutes, policies, and rules of the 18
Department. The election must be made in writing, as follows: 19
(1) For the General Assembly, by the Legislative Services Commission. 20
(2) For the Judicial Department, by the Chief Justice. 21
(3) For The University of North Carolina, by the Board of Governors. 22
(4) For the constituent institutions of The University of North Carolina, by the 23
respective boards of trustees. 24
(5) For the Office of the State Auditor, by the State Auditor." 25
SECTION 3. G.S. 143B-1350 reads as rewritten: 26
"§ 143B-1350. Procurement of information technology. 27
(a) The State CIO is responsible for establishing policies and procedures for information 28
technology procurement for State agencies. 29
Notwithstanding Except as otherwise provided by subsection (l) of this section, 30
notwithstanding any other provision of law, the Department shall procure all information 31
technology goods and services for participating agencies and shall approve information 32
technology procurements for separate agencies. The State CIO may cancel or suspend any agency 33
information technology procurement that occurs without State CIO approval. 34 General Assembly Of North Carolina Session 2025
Page 2 House Bill 549-First Edition
… 1
(l) The Office of the State Auditor is exempt from this Part and may procure information 2
technology services pursuant to G.S. 147-64.7(b)(1)." 3
SECTION 4. G.S. 147-64.4 reads as rewritten: 4
"§ 147-64.4. Definitions. 5
The following definitions apply in this Article: 6
… 7
(3) Federal agency. – Any department, agency, or instrumentality of the federal 8
government and government, any federally owned or controlled 9
corporation.corporation, or entity that receives federal funds. 10
… 11
(4) State agency. – Any department, political subdivision, institution, board, 12
commission, committee, division, bureau, officer, official or any other entity 13
for which the State has oversight responsibility, including but not limited to, 14
any university, mental or specialty hospital, community college, or clerk of 15
court. The term also includes any entity that receives State funds." 16
SECTION 5. G.S. 147-64.6B(b) reads as rewritten: 17
"(b) The Auditor shall investigate reports of allegations of improper governmental 18
activities of State agencies and State employees agencies, employees of those agencies, and 19
individuals who receive public funds within the scope of authority set forth in G.S. 147-64.6, 20
including misappropriation, mismanagement, or waste of State resources, fraud, violations of 21
State or federal law, rule or regulation by State agencies or State employees administering State 22
or federal programs, and substantial and specific danger to the public health and safety. When 23
the allegation involves issues of substantial and specific danger to the public health and safety, 24
the Auditor shall notify the appropriate State agency immediately. When the Auditor believes 25
that an allegation of improper governmental activity is outside the authority set forth in 26
G.S. 147-64.6, the Auditor shall refer the allegation to the appropriate State agency responsible 27
for the enforcement or administration of the matter for investigation. When the Auditor believes 28
that an allegation of improper governmental activity involves matters set forth in subdivisions 29
(1), (2), or (3) of this subsection, those matters shall be referred as follows: 30
(1) Allegations of criminal misconduct to either the State Bureau of Investigation 31
or the District Attorney for the county where the alleged misconduct occurred. 32
(2) Allegations of violations of Chapter 138A, Chapter 120C and Article 14 of 33
Chapter 120 of the General Statutes to the State Ethics Commission. 34
(3) Allegations of violations of Chapter 163 of the General Statutes to the State 35
Board of Elections." 36
SECTION 6. G.S. 147-64.7 reads as rewritten: 37
"§ 147-64.7. Authority. 38
(a) Access to Persons and Records. – 39
(1) The Auditor and the Auditor's authorized representatives shall have ready 40
access to persons and may examine and copy all books, records, reports, 41
vouchers, correspondence, files, personnel files, investments, and any other 42
documentation of any State agency. Upon demand of the Auditor, access shall 43
extend to continuous and unrestricted view of databases, datasets, and digital 44
records necessary for any purpose within the authority of the Auditor, 45
including performing audits of any type, assessing government efficiency, risk 46
assessment, fraud detection, audit planning, and evidence gathering. The 47
review of State tax returns shall be limited to matters of official business and 48
the Auditor's report shall not violate the confidentiality provisions of tax laws. 49
Notwithstanding confidentiality provisions of tax laws, the Auditor may use 50 General Assembly Of North Carolina Session 2025
House Bill 549-First Edition Page 3
and disclose information related to overdue tax debts in support of the 1
Auditor's statutory mission. 2
(2) The Auditor and the Auditor's duly authorized representatives shall have such 3
access to persons, records, papers, reports, vouchers, correspondence, books, 4
and any other documentation which that is in the possession of any individual, 5
private corporation, institution, association, board, or other organization 6
which that pertain to:to either of the following: 7
a. Amounts received pursuant to a grant or contract from the federal 8
government, the State, or its political subdivisions. 9
b. Amounts received, disbursed, or otherwise handled on behalf of the 10
federal government or the State. In order to determine that payments 11
to providers of social and medical services are legal and proper, the 12
providers of such these services will shall give the Auditor, or the 13
Auditor's authorized representatives, access to the records of recipients 14
who that receive such these services. 15
(3) The Auditor shall, has, for the purpose of examination and audit authorized 16
by this act, have the authority, and will shall be provided ready access, to 17
examine and inspect all property, equipment, and facilities in the possession 18
of any State agency or any individual, private corporation, institution, 19
association, board, or other organization which that were furnished or 20
otherwise provided through grant, contract, or any other type of funding by 21
the State of North Carolina, Carolina or the federal government. 22
(4) All contracts or grants entered into by State agencies or political subdivisions 23
shall include, as a necessary part, a clause providing access as intended by this 24
section. 25
(5) The Auditor and his the Auditor's authorized agents are authorized to 26
representatives may examine all books and accounts of any individual, firm, 27
or corporation only insofar as they relate to transactions with any agency of 28
the State. 29
(a1) Hearing. – If a person fails or refuses to provide to the Auditor or the Auditor's 30
authorized representatives the access described in subsection (a) of this section, the Auditor may 31
commence an action in superior court for a show cause hearing. The person shall appear at the 32
hearing and show cause why the person failed or refused to comply with subsection (a) of this 33
section. The court may issue an injunction to the person to comply with subsection (a) of this 34
section. 35
…." 36
37
PART II. OTHER STATE AUDITOR AMENDMENTS 38
SECTION 7. G.S. 126-5 reads as rewritten: 39
"§ 126-5. Employees subject to Chapter; exemptions. 40
… 41
(c1) Except as to Articles 6 and 7 of this Chapter, this Chapter does not apply to any of the 42
following: 43
… 44
(41) Officers and employees of the Office of the State Auditor. 45
… 46
(c14) Notwithstanding any provision of this Chapter to the contrary, each Council of State 47
agency not exempted under subsection (c1) of this section and the Office of the State Controller 48
has the sole authority to set the salary of its exempt policymaking and exempt managerial 49
positions within the minimum rates, and the maximum rates plus ten percent (10%), established 50
by the State Human Resources Commission under G.S. 126-4(2). 51 General Assembly Of North Carolina Session 2025
Page 4 House Bill 549-First Edition
…." 1
SECTION 8. G.S. 143B-168.12(b) is repealed. 2
SECTION 9. Section 62(b) of S.L. 2014-115 is repealed. 3
SECTION 10. G.S. 143B-1410 is repealed. 4
SECTION 11. G.S. 147-64.6(c) reads as rewritten: 5
"(c) Responsibilities. – The Auditor is responsible for the following acts and activities: 6
… 7
(24) If an audit or investigation reveals that money is owed to a State agency by a 8
person pursuant to a contract, transaction, or other arrangement authorized by 9
law, the Auditor shall notify the Department of Revenue so that the owed 10
amount may be collected." 11
12
PART III. EFFECTIVE DATE 13
SECTION 12. This act is effective when it becomes law. 14