Legislature could file IRS complaint about NCAA, ACC for HB2 boycotts

The ACC and NCAA could be the target of an IRS complaint from the N.C. General Assembly under a bill filed late Monday that argues the sports organizations “have engaged in excessive lobbying activities” by moving events out of North Carolina.

Sponsored by five House Republicans, the “Athletic Associations Accountability Act” would require House and Senate leaders to complain to the IRS that the boycotts over North Carolina’s House Bill 2 violate rules for nonprofit organizations.

According to the IRS website, a nonprofit group can’t have tax-exempt status “if a substantial part of its activities is attempting to influence legislation.” The group “may engage in some lobbying, but too much lobbying activity risks loss of tax-exempt status.”

In September, the NCAA relocated seven championships, including men’s basketball tournament games, for the current academic year to other states due to concerns that the law is discriminatory, and the organization could ban North Carolina from hosting future championships.

The new bill’s primary sponsor, Rep. Mark Brody of Monroe, had said on Facebook that he thinks the sports organizations “have stepped out of bounds.” The legislation includes a statement that “the taxpayers of North Carolina should not be required to support the NCAA’s and the ACC’s lobbying efforts against duly enacted state law through the organizations’ continued status as 501(c)(3) tax‑exempt organization.”

The NCAA issued a statement Tuesday defending its actions. “The NCAA has not lobbied North Carolina lawmakers,” the statement said. “All conversations that we’ve had with representatives in the state have been designed to provide information about our championships process and timeline, not take positions on legislation. When the Board of Governors moved championships from North Carolina last year, it was a clear response to state laws that local communities admitted would make it difficult to assure that our events could be held in an environment that was safe, healthy, and free from discrimination for all those watching and participating in our events.

“Our constitution and values commit us to respecting the dignity of every person. Our decisions reflect those values and our principles have not changed.”

Brody’s bill would also force more transparency from the university leaders involved in the ACC’s decision to move neutral-site championship events out of North Carolina in the 2016-17 school year because of HB2.

While the chancellor of Duke University said he voted in favor of the move, the chancellors of N.C. State and UNC-Chapel Hill refused to say how they voted, saying only that “it was a thoughtful and vigorous discussion and was not a unanimous vote.”

Brody’s bill would require any UNC system leader or staff member who serves on a board or committee for an intercollegiate athletic association, such as the ACC and NCAA, to disclose their votes – unless the vote involves a legal settlement or personnel matter.

That disclosure report would go the the UNC system president and Board of Governors, which would be required to notify state House and Senate committees if an employee doesn’t comply with the new requirement.

Brody’s co-sponsors for House Bill 328 are fellow Republican Reps. Chris Millis of Hampstead, Larry Yarborough of Roxboro, Beverly Boswell of Dare County and Larry Pittman of Concord.

This story was originally published March 13, 2017 at 8:43 PM with the headline "Legislature could file IRS complaint about NCAA, ACC for HB2 boycotts."