RALEIGH — An agency-filed bill expanding the powers of the North Carolina State Auditor was vetoed by Gov. Josh Stein.
Under House Bill 549, the state auditor would be able to investigate beyond state and government agencies to any group or entity that “receives, disburses, or handles” state dollars. It would also strengthen the agency’s access to records it seeks by permitting court action for noncompliance.
The measure would also exempt the auditor’s office from most of the State Human Resources Act, except for equal employment and privacy provisions. It would also exempt the auditor’s office from needing gubernatorial approval for consultant contracts, certain information technology statutes and IT procurement approvals. It would also allow the auditor to opt into state IT programs voluntarily.
“House Bill 549 would grant the Auditor sweeping access to the data and records of any private corporation that accepts any amount of state funding,” Stein said in his veto message. “Giving the Auditor this intrusive power may undermine our state’s efforts to recruit businesses to North Carolina.”
Stein also objected to the auditor’s office being exempt gubernatorial approval for IT procurements.
“Our agency bill was written to protect the independence of the State Auditor’s Office,” said N.C. State Auditor Dave Boliek on Stein’s veto. “Throughout the process we were transparent, incorporating feedback from legislators and the governor’s office.”
Boliek said the “autonomy and independence” of watchdog agencies like his “is critical to our mission.”
“Governor Stein’s veto undercuts the important principles of accountability and transparency that taxpayers expect from their government,” Boliek said. “Further, as the governor is aware, our office already has the authority to hold those who receive tax dollars accountable. I have confidence the legislature will stand up for these principles and override the governor’s veto.”
House Speaker Destin Hall (R-Granite Falls) has not yet issued a statement on Stein’s veto of the measure.
The House concurred with changes made by the Senate, and the measure passed on June 24 by a vote of 62-48. The only House Democrat voting in favor was Rep. Shelley Willingham (D-Edgecombe), who may now be the key to an override since the House, unlike the Senate, is one vote short of a supermajority.
The Senate passed a committee substitute on June 19 by a vote of 27-14. Sen. Dan Blue (D-Wake) was the only Democrat to vote in favor.
Other provisions in the bill remove requirements for the auditor to audit the North Carolina Partnership for Children, also known as SMART Start. The most recent audit of SMART Start for the fiscal years ended June 30, 2024, and 2023 showed operating expenses of $7 million and $7.7 million, respectively, and operating revenues totaled $223,000 and $209,000, respectively.
Additionally, the auditor’s office would no longer have to verify membership counts for certain employees’ associations or audit the 911 Board biennially.
If the veto is overridden and the law enacted, the auditor’s office would be required to notify the Department of Revenue of instances where they would recover funds owed by state agencies.
