Can the legislatively-stacked Advisory Budget Commission require the Governor to consult with it before approving state-agency lease-purchase deals over $100,000?

Plain-English summary

In 1990, the Advisory Budget Commission adopted a rule requiring that every proposed state-agency lease-purchase estimated to cost $100,000 or more (and any smaller lease-purchase with extenuating circumstances) be presented to the Governor for "consultation with the Advisory Budget Commission" before the Department of Administration could submit it to the Board of Awards. The State Budget Officer asked the AG in 1995 whether the Commission had the authority to impose that consultation requirement on the Governor.

Chief Deputy Attorney General Andrew A. Vanore, Jr. said no.

The reasoning ran through the NC Constitution's separation of powers provision. Art. I, § 6 declares that the legislative, executive, and judicial powers of state government "shall be forever separate and distinct from each other." Art. III, § 1 vests the executive power in the Governor as "the Chief Executive Officer" of the State. The NC Supreme Court has held that those provisions must be "strictly adhered to" and that they "prohibit the commingling of power by the executive and legislative branches." State ex rel. Wallace v. Bone, 304 N.C. 591 (1982); Advisory Opinion in re Separation of Powers, 305 N.C. 767 (1982).

The Advisory Budget Commission's composition was the problem. N.C.G.S. § 143-4 said the Commission consisted of "five Senators appointed by the President Pro Tempore of the Senate, five Representatives appointed by the Speaker of the House and five persons appointed by the Governor." Ten of fifteen members were sitting legislators. Under Bone and the 1982 Advisory Opinion, legislators may not sit on any board or commission that exercises a part of the administrative or executive power of the State, or which "has any control over the executive power of the Governor."

The Commission's rule did exactly what those decisions forbid: it tried to give a legislator-dominated body control over an executive function (gubernatorial action on state lease-purchases). The fact that the rule was characterized as requiring "consultation" rather than approval did not save it. A mandatory consultation requirement constrains executive action. Constraining executive action through a legislator-dominated body is the commingling that Art. I, § 6 forbids.

The Chief Deputy AG closed by noting that the Governor was free to consult with the Advisory Budget Commission on lease-purchases (or anything else) voluntarily. The constitutional defect was in the Commission trying to make consultation mandatory by rule, not in consultation itself. Once the rule was set aside, the Governor could "proceed without first consulting with the Advisory Budget Commission, should the Governor choose to do so."

Currency note

This opinion was issued in 1995. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

The Advisory Budget Commission has been substantially restructured over the years, and the statutory framework for state lease-purchases in NC has changed multiple times. Modern lease-purchase oversight runs through a different statutory and rule apparatus, including the State Capital Project Process under N.C.G.S. § 143C. The separation-of-powers principles in Bone and Advisory Opinion in re Separation of Powers, however, remain the foundational NC doctrine on legislator participation in executive functions. The NC Supreme Court reinforced and applied those principles in McCrory v. Berger, 368 N.C. 633 (2016), which struck down legislative appointments to specific environmental commissions on similar grounds. Anyone testing whether a particular board's composition can constitutionally control an executive action should start with Bone and McCrory, then check current statutes for that board.

Common questions

Q: What was the practical effect of the opinion?
A: The 1990 Advisory Budget Commission rule requiring gubernatorial consultation before lease-purchase approvals was unenforceable. The Governor could proceed with lease-purchase decisions without first consulting the Commission. Lease-purchases would continue to flow through the Department of Administration to the Board of Awards under their own statutory framework, just without the Commission as a mandatory waypoint.

Q: Could the legislature itself have made consultation mandatory by statute rather than by Commission rule?
A: That is a harder question the opinion did not directly answer. If the legislature wrote a statute requiring the Governor to consult with a particular body before exercising an executive function, the same separation-of-powers analysis would apply if that body included legislators. A non-legislator body created by statute and given an advisory role would face different (and weaker) constitutional objections. The constitutional vice in this opinion was specifically the dominance of sitting legislators on the consulting body.

Q: Did this opinion overturn the 1990 rule, or just say it was unconstitutional?
A: AG opinions are advisory. They do not formally invalidate rules. The opinion's effect was to give the Governor, the State Budget Officer, and the Department of Administration a written legal basis to disregard the rule. A court could have formally invalidated the rule in a suit, but the practical effect of the AG opinion was to render the rule inoperative going forward.

Q: What was special about lease-purchases that triggered this question?
A: Lease-purchases are a hybrid financing structure that lets the State acquire capital assets without an upfront appropriation. They have always attracted legislative interest because the long-term financial commitments resemble bonded debt without going through the usual bond-issuance approvals. The 1990 rule reflected the legislature's desire to keep close oversight on lease-purchases. The constitutional path to that oversight, however, is legislation, not a legislator-dominated commission's mandatory-consultation rule.

Q: What is the Board of Awards?
A: The Board of Awards was the state body that historically approved certain procurement and contracting decisions for state agencies. The 1990 Commission rule wanted the Commission to weigh in before the Department of Administration submitted lease-purchase proposals to the Board of Awards. Modern state procurement under Chapter 143 runs through a different process.

Q: What was the key precedent the opinion relied on?
A: State ex rel. Wallace v. Bone, 304 N.C. 591 (1982). Bone struck down a statute placing legislators on the Environmental Management Commission, holding that legislators may not sit on bodies that exercise executive or administrative powers. The 1982 Advisory Opinion to the Governor reinforced Bone's separation-of-powers reasoning. Both decisions remain foundational NC doctrine.

Background and statutory framework

The NC Constitution sets up an unusually strict separation-of-powers regime by US-state standards. Art. I, § 6 is one of only a handful of state constitutions that uses the phrase "forever separate and distinct" to describe the three branches. Art. III, § 1 vests the entire executive power in the Governor as "the Chief Executive Officer." These provisions have been read by the NC Supreme Court to forbid commingling, not merely to authorize separation. The default rule, in other words, is no overlap; the burden is on the body claiming legitimacy to show that its composition does not violate the constitutional structure.

Bone applied that strict reading. The Environmental Management Commission included legislators. The Supreme Court held the statute creating that commission unconstitutional to the extent it placed sitting legislators on a body exercising executive or administrative power. The same year the Court issued the Advisory Opinion in re Separation of Powers, addressing related questions in the context of a Governor's request for advice. Between Bone and the Advisory Opinion, the Court built a doctrine that has shaped NC public administration ever since.

The Advisory Budget Commission was an obvious target for that doctrine. With ten of fifteen members being sitting legislators, the Commission could not exercise any executive or administrative power. The Commission could advise the Governor on budget matters (purely advisory functions sit within both branches' authority), but it could not require executive action or condition it on Commission concurrence. The 1990 rule went too far in the latter direction.

Citations

• N.C.G.S. § 143-4 (Advisory Budget Commission composition)
• N.C. Const. art. I, § 6 (Separation of Powers Provision)
• N.C. Const. art. III, § 1 (Executive power vested in the Governor)
• State ex rel. Wallace v. Bone, 304 N.C. 591 (1982)
• Advisory Opinion in re Separation of Powers, 305 N.C. 767 (1982)

Source

• Landing page: https://ncdoj.gov/opinions/authority-to-require-that-the-governor-consult-with-the-commission/

Original opinion text

February 9, 1995

Mr. Marvin K. Dorman, Jr. State Budget Officer Office of State Budget and Management 116 West Jones Street Raleigh, North Carolina 27603-8005

RE: Advisory Opinion; Authority of the Advisory Budget Commission to require that the Governor consult with the Commission prior to exercising an executive function; N.C.G.S. §143

4.

Dear Mr. Dorman:

In 1990, the Advisory Budget Commission adopted a policy relating to lease-purchase agreements by state agencies. One requirement of the policy adopted by the Advisory Budget Commission is that all proposed lease-purchases by state agencies estimated to cost $100,000 or more, or any lease-purchases less than $100,000 with extenuating circumstances, must be presented by agency representatives to the Governor, for consultation with the Advisory Budget Commission prior to such requests being submitted to the Board of Awards by the Department of Administration, Division of Purchase and Contract.

You ask our advice whether the Advisory Budget Commission has the authority to adopt a policy mandating that the Governor consult with the Commission prior to further requests being submitted to the Board of Awards. For reasons which follow, it is our opinion that the Advisory Budget Commission does not possess the authority to require the Governor to consult with the Commission before the Governor takes action concerning lease-purchase agreements by state agencies.

By law, the Advisory Budget Commission consists of "five Senators appointed by the President Pro Tempore of the Senate, five Representatives appointed by the Speaker of the House and five persons appointed by the Governor . . . .". N.C.G.S. §143-4. Although the Governor may consult with the Advisory Budget Commission on any matter he deems appropriate, the Governor cannot be required to consult with the Advisory Budget Commission. Any rule by the Commission so requiring is, in our opinion, unconstitutional.

The North Carolina Constitution requires that the legislative and executive powers of the state government be separate and distinct from each other. Article I, Section 6 of the North Carolina Constitution. The Supreme Court of North Carolina has held that the Separation of Powers Provision of our Constitution must be strictly adhered to and that provision prohibits the commingling of power by the executive and legislative branches. State ex rel. Wallace v. Bone, 304 NC 591 (1982); Advisory Opinion in re Separation of Powers, 305 NC 767 (1982). Based upon the Bone and Advisory decisions of our Supreme Court, it is clear that legislators may not sit on any board or commission that exercises a part of the administrative or executive power of the State of North Carolina or which has any control over the executive power of the Governor, the Chief Executive Officer of the State. Article III, Section 1 of the North Carolina Constitution.

Therefore, any regulation promulgated by the Advisory Budget Commission that requires the Governor to consult with it prior to proceeding with the exercise of an executive power is a violation of the Separation of Powers Provision of our State Constitution. Since the Bone and Advisory decisions were issued, our office has rendered numerous opinions concluding that legislators could not serve on any boards or commissions which exercise any portion of the administrative or executive power of the State. We do not include copies of those opinions here, but they are available upon request.

In conclusion, the Governor may proceed without first consulting with the Advisory Budget Commission, should the Governor choose to do so.

Andrew A. Vanore, Jr. Chief Deputy Attorney General