Registration of Non-profit Firms

RE: Advisory Opinion –
Registration of Non-profit Firms under Chapter 89C of the
North Carolina General Statutes

Dear Mr. Carter:

This will respond to your letter in which you asked several questions regarding the applicability of the registration requirement in N.C. Gen. Stat. § 89C-24 of the Engineering and Land Surveying Licensing Act to non-profit corporations. It is our understanding that these questions arise from an inquiry made by Research Triangle Institute, a non-profit corporation, as to whether RTI is required to be registered under G.S. § 89C-24.

As you know, the first sentence of G.S. § 89C-24 provides that: “A corporation or business firm may not engage in the practice of engineering or land surveying in this state unless it is registered with the Board and has paid the required registration fee.” In addition, G.S. § 89C-3 (6) defines the “practice of engineering” as:

Any service or creative work, the adequate performance of which requires engineering education, training, and experience, in the application of special knowledge of the mathematical, physical, and engineering sciences to such services or creative work as consultation, investigation, evaluation, planning, and design of engineering works and systems, planning the use of land and water, engineering surveys, and the observation of construction for the purposes of assuring compliance

Mr. Jerry T. Carter November 16, 1999 Page Two

with drawings and specifications, including the consultation, investigation,

evaluation, planning, and design for either private or public use, in connection

with any utilities, structures, buildings, machines, equipment, processes, work

systems, projects, and industrial or consumer products or equipment of a

mechanical electrical, hydraulic, pneumatic or thermal nature insofar as they

involve

safeguarding life, health or property, and including such other professional

services as may be necessary to the planning, progress and completion of any

engineering services.

Since G.S. § 89C-24 makes no distinction between business and non-profit corporations, we conclude that the registration requirement therein would apply to any corporation, including a non-profit corporation, if the corporation is engaged in the practice of engineering as defined by the statute. With respect to RTI, it is our understanding from talking to David Tuttle, in-house counsel for the Board of Examiners for Engineers and Surveyors, that RTI does engineering research and also provides certain paid contractual services which would appear to fall within the definition of “practice of engineering” as set out in G.S. § 89C-3. It is therefore our opinion that if RTI is in fact engaged in the practice of engineering as defined by the statute, then it would not be exempt from the registration requirement of G.S. § 89C-24.

With respect to other types of non-profit corporations, including universities, we believe that the applicability of G.S. § 89C-24 would again depend on whether the organization is engaged in the practice of engineering. In our opinion, research and teaching activities do not come within the statutory definition of “practice of engineering” because they do not involve the direct application of engineering skills to products, structures or systems which are consumed or used by the public. Thus, a university or research institution which only engages in teaching or research, would be exempt from the registration requirement of G.S. § 89C-24. However, if any such university or institution also provides actual engineering services as defined by G.S. §89C-3 (6), then it would be required to register with the Board.

You also inquired as to the circumstances under which a “research affiliate” may be exempted under G.S. § 89C-25(7) from the registration requirements of Chapter 89C. It appears that this question may have been prompted by RTI’s assertion that it may be exempted under the statute in certain circumstances because of its affiliation with various organizations in the performance of research and development work. As you know, the statutes do not define the term “research affiliate”, and it may therefore be unclear in some instances whether the term applies to a particular entity or organization. However, considering the Board’s rulemaking authority under Chapter 89, the Board should adopt appropriate rules which would define the term with more specificity and designate those circumstances under which the statutory exemption would apply.

Mr. Jerry T. Carter November 16, 1999 Page Three

We trust this advisory opinion will be helpful in answering your questions. If you would like to discuss this matter further, please call Richard Sowerby at 733-3316.

Sincerely,

Reginald L. Watkins Senior Deputy Attorney General Civil Division

Robert O. Crawford, III Special Deputy Attorney General Transportation Section

Richard G. Sowerby Assistant Attorney General Transportation Section

RGS:lw

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