North Carolina Department of Justice
North Carolina Department of Justice
North Carolina Department of Justice
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Reply to: Jeffrey B. Parsons Property Control Section Telephone: (919) 733-7408 FAX: (919) 733-2947

jparsons@mail.jus.state.nc.us

July 18, 2002

Mr. John T. Carter, Jr. Jacksonville City Attorney Warlick, Milsted, Dotson & Carter 320 New Bridge Street Post Office Box 766 Jacksonville, North Carolina 28541-0766

Re: Request for Attorney General’s Opinion

Dear Mr. Carter:

On May 9, 2002, you submitted a request for an Attorney General’s opinion to James C. Gulick, Esq., Senior Deputy Attorney General, setting forth the following question:

Whether a municipality’s construction of improvements for its public enterprise system constitute[s] “building projects” for purposes of being subject to the requirements of N.C. Session Law 2001-496?

As a matter of background, we understand from your letter that the City of Jacksonville was awarded a grant from the North Carolina Department of Environment and Natural Resources, (“DENR”), to install sewer systems in an involuntary annexation area. You further note that DENR has taken the position that the provisions of N.C. Session Law 2001-496 apply to the construction of sewer systems as well as public buildings. You cite

G.S. § 160A-311 and Davidson County v. City of High Point, 85 N.C.App. 26, 354 S.E.2d 280, modified and affirmed, 321 N.C. 252, 362 S.E.2d 553 (1987), for the proposition that a sewer system is not a building, and, thus, a sewer system is not within the definition of “public buildings” or “building projects” regulated by the provisions contained in N.C. Session Law 2001-496.

In further support of this position, you cite legislative history to show that in an

John T. Carter, Jr. page 2 July 18, 2002

earlier legislative committee conference report, the phrase “building projects” was defined in G.S. § 143-128.2(a) “to include water, sewer and landscape projects when buildings are erected or repaired....” The subsequent and final ratified version of that statutory provision does not include the above-quoted language defining building projects. From that history, you argue that the construction of sewer systems were not to be covered under the minority contractor provisions established in G.S. § 143-128.2.

Upon further analysis of the circumstances surrounding your question, we do not believe that it is necessary for us to reach the question of what constitutes a “building project” as set forth in N.C. Session Law 2001-496. We have learned that the City of Jacksonville’s proposed sewer construction is subject to the terms of a grant from DENR. (See the attached). Pursuant to G.S. § 160A-17.1, a city or county is authorized to accept grants from the State:

“for constructing, expanding, maintaining and operating any project or facility, or

performing any function, which such city or county may be authorized by general

law or local act to provide or perform.”

“In order to exercise the authority granted by this section, the governing body

being city or county, may:

(3) agree to and comply with any lawful or reasonable conditions which are imposed upon such grants or loans; (emphasis added). .....

G.S. § 160A-17.1(3).

The $ 2 million waste water collection facilities grant provided by the State on April 24, 2001 was accepted by the City of Jacksonville by Resolution dated June 5, 2001. The Grant is subject to certain assurances that are made by the Grant recipient. (See Grant, Section II - Assurances). Section II-D states:

“The applicant hereby gives assurances to the Environmental Management

Commission that:

D. The applicant shall submit evidence that the requirements for compliance of participation by minority businesses has been accomplished in accordance with G.S. 143-128.”

As recognized in G.S. § 160A-17.1(3), the governing body of a city may agree to

John T. Carter, Jr. page 3 July 18, 2002

comply with any lawful and reasonable conditions imposed by a grant. By accepting the State grant for the construction of waste water collection facilities in June 2001, the City clearly agreed to comply with then existing minority business participation requirements prescribed by G.S. § 143-128 (2001). G.S. § 143-128 (2001) contains a verifiable ten percent (10%) goal for participation by minority businesses in the total value of work for each building project. This goal applies to construction projects funded by the grant unless the City has adopted a verifiable percentage goal for participation by minority businesses in accordance with G.S. § 143-128(f) (2001).

Under G.S. § 160A-17.1, the governing body of a city is specifically authorized to accept a State grant for constructing “any project.” Accordingly, it is appropriate to interpret the provisions of G.S. § 143-128 (2001) as applying to the construction of the waste water collection facilities which are subject to this grant from DENR.

This is an advisory letter. It has not been reviewed and approved in accordance with procedures for issuing an Attorney General’s opinion.

Very truly yours,

ROY COOPER Attorney General

Reginald Watkins Senior Deputy Attorney General

Jeffrey B. Parsons Assistant Attorney General

cc: James C. Gulick Roy A. Giles, Jr.

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