Rep. Mark Brody said over the weekend that he intends to file a bill Monday that will make an effort to determine if the NCAA and the ACC have violated their tax-exempt status by bullying of North Carolina over HB2.
Both sports organizations have acted against the state over the legislation many felt was necessary to ensure the safety and privacy of women and young girls. The city of Charlotte passed an ordinance last year that required businesses to allow anyone to use the bathroom that they claimed to “identify with” at the time. This ordinance would allow men into areas traditionally held as private to females simply on their assertion that they were identifying as a female.
When HB2 was signed into law, out-of-state groups began attacking in earnest, with the NCAA and the ACC taking championship games out of North Carolina in an effort to force the General Assembly to repeal the legislation. When the smoke cleared, the NCAA had moved seven and the ACC moved 10 championship games. These actions have prompted Brody to draft legislation that will investigate whether the sports entities have crossed the line into activities that break federal tax laws by being political or lobbying in nature.
The Internal Revenue Service is direct in its rules regarding lobbying and tax-exemption as found on its website: “In general, no organization may qualify for section 501(c)(3) status if a substantial part of its activities is attempting to influence legislation (commonly known as lobbying). A 501(c)(3) organization may engage in some lobbying, but too much lobbying activity risks loss of tax-exempt status.”
Brody posted his intentions on his Facebook account on Sunday. His announcement reads as follows: “There comes a time when the citizens of North Carolina need to stand up and say ‘Enough of this foolishness!’ Monday, I will file the Athletic Association Accountability Act. It is an act to determine whether the NCAA and the ACC have violated their Tax-Exempt status by engaging in political or lobbying activities. Specifically, the NCAA and the ACC have allegedly engaged in excessive lobbying activities that exceeded their respective charters by using economic retaliation against NC for the purpose of forcing the General Assembly to adopt social legislation that is not connected to their core mission. I believe the NCAA and the ACC have stepped out-of-bounds and, to the best of my ability, will never allow the General Assembly to relinquish its legislative authority over the internal affairs of the State or succumb to economic extortion to and from either the NCAA or the ACC.”
The details of how the bill will make the determination are unclear at this point. Also unclear is what the actions might be taken if the organizations are found to have violated the provisions tied to their tax-exempt status. Brody is clear, however in his motivation in filing the bill: He has had enough of North Carolina being bullied by the NCAA and the ACC.