When a NC joint municipal power agency (like ElectriCities member agencies) buys or sells property, does the public-bid-law exemption in G.S. 159B-11(12) and (13) cover all of its property dealings, or only the privately negotiated ones?

Plain-English summary

ElectriCities of North Carolina asked whether exemption language in G.S. 159B-11(12) and (13) applied only to those subsections or to all powers of joint municipal power agencies under G.S. 159B-11. The AG predicted that a court would most likely limit the exemption to the two subsections. More specifically, the opinion read it to cover acquisitions and dispositions made through private negotiation under those provisions.

The 1977 amendments added private-negotiation authority and exemption language within subsections (12) and (13). They left the agency's more general acquisition, pledge, and disposition powers in subsections (6), (7), and (8) unchanged. The AG reasoned that the placement of the new language, together with rules for reading statutory amendments, showed a limited exemption rather than one covering all the agency's powers.

Subsection (12) expressly includes privately negotiated acquisition of an existing project, a project under construction, or other property. The opinion does not decide whether a specific purchase, construction project, or service contract fits that language. A reader must identify the statutory power governing the actual transaction before applying this opinion's conclusion.

Currency note

This opinion interprets the relevant provisions and their 1977 amendment history as described in the 1993 letter. Check the current statute for a present transaction.

Background and statutory framework

The opinion says joint municipal power agencies are public agencies generally subject to laws governing public bodies, including public bid laws. G.S. 159B-11 listed 20 powers. The 1977 legislature rewrote two subsections to authorize private negotiation and added the exemption at the end of each; it did not place a separate exemption in the list of general powers.

The AG applied a rule that an amendment to one statutory subsection ordinarily does not change related, unamended subsections. It also applied the principle that a specific provision governs the situation it addresses. On that reasoning, the 1977 exception did not extend to other G.S. 159B-11 powers. The opinion does not classify routine purchases or projects by name and does not decide whether any particular deal must be competitively bid.

Common questions

Does the exemption apply to all the agency's powers under G.S. 159B-11?

No, under the AG's interpretation. It applies to the privately negotiated acquisitions and dispositions addressed in subsections (12) and (13), not to the powers in the other subsections simply because the same agency holds them.

Why did the AG limit its reach?

The 1977 amendments placed exemption language inside subsections (12) and (13), while leaving general property-power subsections unchanged. The opinion says a broadly intended exemption could have been placed in a separate subsection applying to all the powers.

Does the opinion decide whether buying office equipment or building an office requires bids?

No. It does not analyze those transactions. Subsection (12) includes privately negotiated acquisitions of “other property,” so the statutory fit and current rules must be assessed for a particular transaction.

Source

• Landing page: https://ncdoj.gov/opinions/request-from-electricities-of-north-carolina-for-an-interpretation-of-g-s-159b-11/

Original opinion text

March 16, 1993

Ms. Alice Garland
Director, Government Affairs
ElectriCities of North Carolina, Inc.
Post Office Box 29513
Raleigh, N.C. 27626-0513

Re: Advisory Opinion Concerning the Request from ElectriCities of North Carolina for an Interpretation of G.S. 159B-11

Dear Ms. Garland:

By letter dated March 2, 1993, ElectriCities has requested an opinion regarding G.S. 159B-11 as it applies to joint municipal power agencies. Such joint agencies are created pursuant to G.S. 159B, Article 2, and are public agencies. They are, in general, subject to the laws applicable to public bodies, including the public bid laws. G.S. 159B-11(1) through (20) delineate the general powers granted to these joint municipal agencies. Language in two of those subsections, (12) and (13), provides that no provisions of law with respect to the acquisition, construction or operation and disposition of property by other public bodies shall be applicable to any agency created pursuant to Chapter 159B. ElectriCities notes that the language "any agency created pursuant to this Chapter" would indicate that it applies broadly to the power agencies, while the placement of the language within the subsections rather than at the end of the authorities section raises the question of applicability, and has requested our opinion on the following question:

Is the exemption language in subsections (12) and (13) limited in applicability to the powers conferred in those subsections or does it also apply to the powers conferred upon joint agencies in the other subsections of G.S. 159B-11?

It is our opinion that a court would most likely conclude that the exemption language contained in subsections (12) and (13) applies only to those subsections. Although the language of the exception implies general applicability, the legislative history of the section and settled principles of statutory construction lead to the conclusion that the General Assembly intended to limit the exception to the acquisition and disposition of property through private negotiations as set forth in subsections (12) and (13). We conclude, therefore, that the exception does not apply to the powers granted joint agencies in other subsections of G.S. 159B-11.

Twenty specifically enumerated powers are granted to joint agencies in G.S. 159B-11. As originally enacted, the power to acquire, pledge and dispose of all property was contained in subsections (6), (7), (8), (12) and (13). None of the referenced subsections specifically authorized joint agencies to acquire and dispose of property through "private negotiation" and none contained exemption language. See 1975 Session Laws, c. 186, s. 1. Thus, at the time of original enactment, joint agencies were subject to the laws applicable to other public bodies, including the public bid laws, with respect to their acquisition, pledging and disposition of property.

In 1977, the General Assembly passed S.B. 187, AN ACT TO AMEND AND CORRECT OMISSIONS AND INTERNAL INCONSISTENCIES IN CHAPTER 159B OF THE GENERAL STATUTES. Some, though not all, provisions dealing with the acquisition and disposition of property were amended and rewritten by the 1977 Act. Subsections (6), (7) and (8), which dealt with the joint agencies' power to acquire, pledge and dispose of property in general terms, remained unchanged. However, G.S. 159B-11 was amended by the 1977 Act to specifically authorize "private negotiations" and to add the exemption language. This amendment was accomplished by rewriting subsections (12) and (13) in their present forms. The exemption language was added not as a parallel, separate or coordinate subsection but as the final provision within subsections (12) and (13). As a result of the 1977 amendments, subsection (12) now grants joint agencies the following authority:

To acquire by private negotiated purchase or lease or otherwise an existing project, a project under construction, or other property, either individually or jointly, with one or more municipalities in this State or any state contiguous to this State owning electric distribution facilities or with any political subdivisions, agencies or instrumentalities of any state contiguous to this State or with other joint agencies created pursuant to this Chapter; to acquire by private negotiated purchase or lease or otherwise any facilities for the development, production, manufacture, procurement, handling, storage, fabrication, enrichment, processing or reprocessing of fuel of any kind or any facility or rights with respect to the supply of water, and to enter into agreements by private negotiation or otherwise, for a period not exceeding fifty (50) years, for the development, production, manufacture, procurement, handling, storage, fabrication, enrichment, processing or reprocessing of fuel of any kind or any facility or rights with respect to the supply of water; no provisions of law with respect to the acquisition, construction or operation of property by other public bodies shall be applicable to any agency created pursuant to this Chapter unless the legislature shall specifically so state; (Emphasis added.)

Similarly, subsection (13) now contains the following grant of authority:

To dispose of by private negotiated sale or lease, or otherwise an existing project, a project under construction, or other property either individually or jointly with one or more municipalities in this State or any state contiguous to this State owning electric distribution facilities or with any political subdivisions, agencies or instrumentalities of any state contiguous to this State or with other joint agencies created pursuant to this Chapter; to dispose of by private negotiated sale or lease, or otherwise any facilities for the development, production, manufacture, procurement, handling, storage, fabrication, enrichment, processing or reprocessing of fuel of any kind or any facility or rights with respect to the supply of water; no provisions of law with respect to the disposition of property by other public bodies shall be applicable to any agency created pursuant to this Chapter unless the legislature shall specifically so state; (Emphasis added.)

Application of well-established principles of statutory construction supports our conclusion that the exemption language written into subsections (12) and (13) by the 1977 amendments applies only to acquisitions and dispositions that are privately negotiated, not to all powers conferred in G.S. 159B-11. First, 159B-11 must be construed with reference to the 1977 amendments. The general rule is that were a statute has two distinct subsections dealing with related matters, an amendment to one of the subsections will not ordinarily be construed to apply to the other also, since it is presumed that if the legislature intended it to apply to both, it would have expressed such intent. Therefore, all portions of the original act which are not in conflict with the provisions of the amendment normally remain in force with the same meaning and effect that they had before the amendment. Arrington v. Stone & Webster Engineering Corp., 264 N.C. 38, 140 S.E.2d 759 (1965); Rice v. Rigsby, 259 N.C. 506, 131 S.E.2d 469 (1963). In addition, a provision of a statute that deals with a specific situation controls, with respect to that situation, other provisions which are general in their application. In such cases, the specially treated situation is regarded as the exception to the general rule. This rule of construction is especially applicable where the specific provision is the later enactment. State ex rel. Utilities Commission v. Lumbee River Electric Membership Corp., 275 N.C. 250, 166 S.E.2d 663 (1969).

It is our opinion that with respect to the power to acquire, construct or operate property [subsection (12)] and with respect to the power to dispose of property [subsection (13)], joint agencies were subject to the provisions of law applicable to other public bodies, including the public bid laws, prior to the 1977 amendments. We believe that the 1977 amendments to these subsections enlarged the joint agencies' power in this regard by authorizing acquisitions and disposition through (a) private negotiations; and (b) exempting such privately negotiated acquisitions and dispositions from other laws governing public agencies. Cognizant of the rules of statutory interpretation, the legislature placed the exemption language within the applicable subsections, intending that the exemption language apply only to those specific subdivisions and that all other subsections of G.S. 159B-11 retain the same meaning and effect that they had before the 1977 amendments. Had the legislature intended the exemption language to apply to all of the powers granted joint agencies in other subsections of G.S. 159B-11, and not merely to those powers delineated in subsections (12) and (13), it could easily have expressed that intention by placing the exception language in a separate subsection which, by its terms, clearly applied to all other subsections.

MICHAEL F. EASLEY
Attorney General

Jo Anne Sanford
Special Deputy Attorney General

Lorinzo L. Joyner
Special Deputy Attorney General