RALEIGH, N.C. — On a 200-mile drive from the state capital to Kings Mountain, a tiny town where the Charlotte suburbs fade into the Appalachian foothills, state Rep. Chuck McGrady told House Speaker Tim Moore, one of the most powerful Republicans in North Carolina, not to do it.

“We shouldn’t go down this road,” McGrady told Moore just over a year ago, as he gave his fellow legislator a lift home from a session while Moore’s car was in the shop. The warning came days after Charlotte’s City Council passed an ordinance that allowed transgender people to use the bathroom of their choosing. At the time, Moore was “trying to figure out what they might do” in response, McGrady said. “I told him, ‘Let’s take our time with this.’”


But Moore, who declined to be interviewed for this story, didn’t take McGrady’s advice. In a one-day special session last March, the Republican-controlled supermajority passed House Bill 2, effectively banning legal protections for gay, lesbian, bisexual and transgender people and requiring North Carolinians to use the bathroom assigned by their birth certificate in public places.

The backlash was swift, redefining North Carolina in the year that has elapsed since the bill’s passage, as critics and lawsuits have taken aim at what opponents view as an overly broad law that mandates discrimination against the LGBT community. The NBA relocated its All-Star game, while a long list of big businesses, like Bank of America, Wells Fargo and Dow Chemical, demanded a repeal. Forbes estimated the state had suffered $630 million in losses as of last fall. And the repercussions show little signs of easing after a year marred by boycotts, partisan rancor and finger-pointing—nearly two-thirds of North Carolina voters say they would rather eliminate HB2’s negative economic impact over enforcing the law.

In November, voters had their say on HB2—and the message they sent was … not at all clear. They booted Republican Gov. Pat McCrory, who had vigorously defended HB2, out of office and elected Attorney General Roy Cooper, a Democrat who ran on repealing it, by a razor-thin margin. They also reelected Republican Lt. Gov. Dan Forest, who wrapped himself in HB2 and won more votes statewide than Cooper or even Donald Trump, who carried the state easily. Republicans also maintained their supermajority in the General Assembly.

All of which helps explain why, despite the polls, despite Cooper’s commitment to tossing out the law, despite the Republican leadership’s willingness to cut a deal, despite the unrelenting pressure from the business community, HB2 is still there. And after months of abandoned compromises to address the law, it’s become harder to distinguish good-faith efforts from political theater. Walking along the cinder block hallways of the state legislative building in recent days, I found the HB2 mess hangs over legislators like a cloud.

“Frustration, depression, anxiety, exasperation—it’s all that and more,” said state Rep. Ken Goodman, a moderate Democrat from eastern North Carolina, sighing heavily after each noun. “It has sucked all the air out of that building for a year, and we’re all suffocating.”

There is a ticking clock, as legislators continue to grapple over HB2 compromises. The NCAA, which already punished in-state basketball powerhouses Duke and UNC-Chapel Hill by moving March Madness games out of the state this year, will announce site selections for the next six years of championship games in April. We’ve come so far as to find UNC coach Roy Williams lamenting Duke’s defeat last week, citing the loss of a hometown crowd as an explanation. But the NCAA games won’t be coming back to North Carolina—a state where college basketball is practically its own religion—without a repeal.

And in much of North Carolina’s rural counties—areas that don’t play host to NCAA games, but watch them on TV—HB2 is still popular. These communities are bastions of social conservatism, where HB2 is seen as a necessary shield to protect the safety and privacy of bathrooms.

Repeal proposals are still flying back and forth—or alternatives like adding “religious freedom” legislation—but prospects for unwinding the law remain dim, as distrust runs rampant. And the issue is further complicated by the statewide ambitions of Moore and President Pro Tem Phil Berger, as confirmed by half a dozen GOP sources familiar with these conversations. A glossy, 24-inch by 11-inch portrait of Berger, a mailer touting his leadership, showed up in Republican households in recent weeks.

“The politics of political ambition are driving the internal politics of the legislative caucuses,” one Republican strategist in the state said of Moore and Berger. The source added that the two GOP leaders are squeezed on both sides, as they don’t want to invite “possible primary challengers from the right” and must not lose their donors in the business community, who want HB2 gone.

As for Cooper, whose political office has been stripped of some its power by the General Assembly, he comes across as almost helpless. “They all know HB2 has been bad for North Carolina, but the politics of it is … ” the governor said in an interview, letting his words trail off into a brief silence. “They’re choosing that over fixing the public policy problem that they know exists because of their inner war with their caucus.”



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McGrady, a sleepy-eyed moderate Republican who served as the Sierra Club’s national president, knows a thing or two about endangered species.

“I just never expected to be one,” he said, leaning back on a couch in his legislative office. “But I’m pretty comfortable in my skin after all this time,” even though the General Assembly around him has grown increasingly partisan, making him a rarity in North Carolina politics.

Like many in his position, McGrady never wanted to get wrapped up in social issues—he’d rather talk about fixing the state’s coal ash problem. But he didn’t attend the March special session (he was on a cruise) and he’s led negotiations on repealing HB2. Last month, he filed a bill to do that, and HB2’s critics consider it one of the most promising last-ditch efforts. But the bill has stalled over Cooper’s objections to a referendum provision, which would give opponents to a city’s local nondiscrimination ordinance 90 days to initiate a ballot referendum to repeal it. Democrats object on principle—they say it’s unacceptable to put civil rights on the ballot.

Without the referendum, Cooper said he thinks McGrady’s bill would stand a good chance. “We’d lose a number of Democrats, but I do think we could get that passed,” Cooper said. “I think it goes too far in many ways, but we’re trying hard to get HB2 repealed and I think that Democrats are willing to swallow compromises in order to make this happen.”

Republicans dispute that Cooper has acquiesced. Instead, they accuse him of sabotaging the negotiations for his own political gain. Berger, who also declined to be interviewed for this story, wrote in a blog post that the “flood of national media attention” around HB2 in the past year meant that the “campaign cash poured into Cooper’s political machine.”

Even McGrady, who’s inclined toward compromise, is growing exasperated with the governor. Last month, he posted on Facebook that Cooper’s “senior staff told me a week ago that his political advisors strongly urged him not to compromise at all because the political issue would help Democrats in the 2018 election.” A Democratic official familiar with the conversation strongly rejected McGrady’s characterization of the conversation, adding that the staffer was referencing political blowback to introducing a religious freedom bill in the state, not HB2.

“[Cooper] said he wants compromise, but actions speak louder than words, and I just haven’t seen the action piece here,” McGrady said.

***

Democratic state Sen. Joel Ford is frustrated, too. Ford, a suspenders-wearing Charlotte health care executive with a booming voice, moved into his legislative office two months ago, but he’s still got nearly a dozen pictures waiting to be hung, leaning precariously along his wall.

“That’s life in the minority party,” he said with a baritone laugh. But it’s the unfinished business of HB2 that wears on him more than the clutter. And in particular, he’s fuming over the December special session that he calls “a missed opportunity.”

In the final weeks of 2016, Berger, Cooper and Moore met in a cramped hotel conference room, intent on quietly working out a deal that might lead to the repeal of HB2 and mitigate the damage done to the state’s image and economy. Cooper said he received assurances from Berger and Moore that if he could “talk the Charlotte City Council into repealing” their ordinance, then they had votes in their caucuses for a full repeal of HB2. Berger, in a blog post, called it a “full repeal for full repeal.”

Days later, at Cooper’s urging, the Charlotte City Council repealed the major parts of its ordinance, including all clauses related to bathrooms and locker rooms. But Republicans cried foul, saying Charlotte hadn’t repealed the ordinance in its entirety. Hours before the special session gaveled in, Charlotte called an emergency meeting to repeal its ordinance in full. But Republicans, closeted in hours-long closed door meetings, said votes peeled away. “That did irreparable damage to people’s trust,” said one North Carolina Republican operative.

During those caucus meetings, Republicans also tracked Charlotte Mayor Jennifer Roberts’ social media posts, where she promised a “long-game” approach to progressives who urged Democrats not to compromise with Republicans. “Stay tuned,” Roberts wrote.

“I was born at night, but I wasn’t born last night. The Democrats weren’t being up front about wanting this to all be over,” said state Sen. Andrew Brock, a conservative from western North Carolina. “So for the people who were willing to vote for a repeal, they felt like Lucy was pulling back the football.”

As the deal began unraveling, Berger went to Senate Democrats and floated a repeal of HB2 with a moratorium, meaning no cities could try to pass a Charlotte-style ordinance for six months. Cooper and Senate Democrats rejected it, since it wasn’t a clean repeal, which deviated from their agreement. “When it came time for the House and Senate to do its job, they did not do it,” Cooper said. Legislators went home for Christmas empty-handed.



Identity politics do not work in North Carolina,” says Ford.



“We should’ve taken the deal in December,” Ford said, calling it a “no-brainer” now. So much so that he filed a bill Tuesday that would essentially recreate Berger’s terms from December, a repeal with a six-month cooling off period. But Berger put the kibosh on it, telling a Charlotte TV station that there wasn’t enough support for it in either party.

Ford, meanwhile, has his own ambitions to consider. He’s running for Charlotte mayor in a primary against Roberts, so he has an incentive to be critical of how HB2 has been handled. But in the meantime, he’s urging his fellow Democrats to avoid purity tests on social issues that appeal to voters in urban centers, but don’t resonate with rural voters outside of Wake and Mecklenburg counties. In the past three election cycles, a majority of unaffiliated voters, the fastest growing party affiliation in the state, have backed Republicans over Democrats.

So what do Democrats need to talk about in North Carolina?

“Anything but a social issue, but we can’t get off of that,” Ford told me, slamming his desk for emphasis. “Identity politics do not work in North Carolina.”



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Lt. Gov. Dan Forest is at the other end of the HB2 spectrum. Forest, an architect turned hard-core conservative politician, opposes the ongoing efforts to repeal the law. He went to Texas earlier this month to urge lawmakers there to pass a bathroom law of their own.

Over the past year, Forest said, the narrative around HB2 has been “disingenuous, at best.”

“Now it’s the anti-LGBT bill,” he said, insisting it centers on safety and privacy. “There’s nothing anti-LGBT about it.”

On safety, Equality N.C.’s executive director Chris Sgro pointed out that more than a 100 cities and 19 states already extend Charlotte-style protections to LGBT people. “I don’t see any legislators who have a problem taking their kids to Disney World, because Orlando has the exact same bathroom policy,” he said.



I don’t see any legislators who have a problem taking their kids to Disney World, because Orlando has the exact same bathroom policy,” says Sgro.



It also drives Forest crazy that for all the talk of financial blowback because of HB2, the state’s economic picture is bright. North Carolina’s budget surplus tops $500 million, and the state is adding thousands of jobs every month. “If Cooper didn’t have HB2 to talk about, what could he possibly criticize Republicans for?” asked Dee Stewart, a GOP consultant in the state.

But Cooper, now in charge of marketing his state to corporations, said that doesn’t account for companies who might have moved to North Carolina, but won’t because of HB2’s “stain.” If they had, the state’s economy would “take off” even more, the governor said.

Shaking his head at Cooper’s comments, Forest said: “Give me a list,” referring to companies who won’t move here. “I’ll call them.”

Forest readily admits that as lieutenant governor, he doesn’t have a vote on HB2. But his influence among his party looms large, especially as he’s preparing for a likely gubernatorial challenge to Cooper in four years.

“If Forest came out and said, ‘This is a compromise bill I can get behind,’ we’d pick up at least a dozen Republican House members,” said one House GOP member. “That’ll never happen, but I don’t know if it’s because Forest firmly believes in the law or if it’s because he wants to shore up his base in 2020.”



***

North Carolina may not have seen the last of HB2, or something like it, much to the horror of many an overwrought state legislator.

Behind the state’s political impasse is geography: Rural and urban priorities are on a collision course. Among the country’s 10 most populous states, North Carolina has “the largest proportion of individuals living in rural areas,” UNC’s Carolina Population Center wrote last year.

“We have, as a state, no real history of big city politics intervening in the state, so in many ways HB2 was a first really significant time when a public policy emerged from a city, where the issue had a very different impact in on the state level rather than city,” said Joe Stewart, executive director of the N.C. Free Enterprise Foundation, a bipartisan political firm. “HB2 was the first, but it is probably not the last time. We should expect more of this.”

That may now include a religious freedom bill that Democrats say would allow discrimination under a different guise. On Wednesday, House Democratic Leader Darren Jackson tweeted pictures of proposed legislation from Republicans that he said would attach religious freedom language, echoing Indiana’s controversial RFRA law, to the repeal of HB2. McGrady told The Raleigh News and Observer that “RFRA has been discussed,” but the documents Jackson tweeted are “not my work.”

Jackson said House members had a “compromise in sight” this week, but now “we’re moving in the opposite direction again.”

“It’s hard to believe it’s been a year,” he said.