Deep in a state Senate budget that slashes jobs and transfers key divisions from the state environment department is a ban on any new environmental, labor and farm rules that are tougher than federal standards.
The prohibition echoes a 1970s-era measure that legislators eventually repealed. Now as then, it pits business against environmentalists in a fight over whether the regulations impede economic growth or protect the public.
The Senate proposal follows regulatory-reform hearings the legislature's new Republican majority held around the state this spring. The hearings convened as the state struggles to rebound from 9.7 percent unemployment and steep budget shortfalls.
N.C. Chamber President Lew Ebert calls the proposal "preemptive medicine" that would create the regulatory predictability and stability that businesses crave. Ebert said North Carolina created 15,000 state rules over the past decade. "It's a chance to deal with a big concern and say we're ready to do business," he said.
ChiefExecutive .net and Forbes .com , however, already rank the state's business-friendly climate second- and third-best in the country.
"In the end the companies that are here create jobs. The studies don't," Ebert said.
Environmental advocates say the move would leave the state at the mercy of one-size-fits-all federal regulations that often ignore local issues.
"We would be prohibited from looking out for North Carolina's best interests in deciding what we need in the way of environmental protection," said state Sierra Club Director Molly Diggins.
Rules and exceptions
The new proposal would keep the environment, labor and agriculture departments from adopting state rules more restrictive than similar federal standards. It allows some exceptions, such as for "unforeseen threats" or court orders, and would not preclude the legislature from acting.
New rules with no federal parallel would have to undergo cost-benefit studies to prove their worth.
Decades ago, the business-supported Hardison Amendments, named for a former state legislator, also prevented the state from enacting stronger environmental standards than the federal government. They were repealed in 1991.
Even so, the state Manufacturers & Chemical Industry Council, which represents some of the largest North Carolina industries, says the new proposal would stabilize the regulatory environment and boost the jobs picture.
Such measures bubble up in states across the nation, said Steve Brown, executive director of the Environmental Council of the States, a national group of environmental agency leaders.
The problem, he said, is states give up local control.
State rules are intended to address local and regional matters to which broader federal regulations don't apply - hog farm odors, groundwater standards or open burning, for instance, in North Carolina.
The two often overlap. But in some cases the state and federal governments take different regulatory approaches.
North Carolina, for example, regulates 97 toxic air pollutants to the 187 that the Environmental Protection Agency oversees. EPA prescribes pollution-control technology for broad industry sectors.
The state, in contrast, takes the extra step of applying health-based standards meant to ensure that toxic emissions are within safe limits at individual plant boundaries.
State agencies share legislators' frustration with regulations, Brown said. Typical state environmental budgets haven't risen since 2004 despite a growing workload, including new federal regulations that states have to adopt.
The N.C. Department of Environment and Natural Resources is likely to see heavy job cuts under any budget scenario. The state House would cut 206 jobs in 2011-2012, the Senate 132, and Gov. Bev Perdue 101.
The House and Senate budgets abolish the department's environmental health division, moving its functions elsewhere, and transfer its forestry division to the agriculture department.