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 Bulletin: February 11, 2010 

2010 is an Important Election Year; Many Changes Occurring

This year is a critical year for the North Carolina General Assembly. Recent changes in the Senate and House, as well as the November elections, will heavily influence the 2010 session and its issues. Below is a summary of some key changes.

  • Former long-time Senate Majority Leader Tony Rand out. Sen. Martin Nesbitt (Asheville) in as Senate Majority Leader.
  • New 2010 Rules Chair
  • 6 Senators (4 Dems, 2 Reps) have already left or announced not running again (to date)
  • 10 House members (4 Dems, 6 Reps) not running again (to date)
  • November elections outlook:
    • Hotly contested seats in at least 7-8 Senate districts and at least 10 House districts.
  • Current Makeup
    • House: 68 Democrats; 52 Republicans
    • Senate: 30 Democrats; 20 Republicans
  • Redistricting: 2010 Elections critical because next General Assembly will draw state legislative Districts after the census.

Recent Developments

Economic Outlook Remains Weak; State-Collected Local Revenues Critical to Our Towns/Cities

State revenues so far this year are 2.6 percent below budgeted levels, but the shortfall has been offset by better than expected collection of back taxes. The lower revenues will affect the state's FY 10-11 budget, however, and could result in efforts to reduce the municipal share of state-collected revenues such as the utility franchise tax. As you meet with your legislators in the coming months, remind them of the importance of state-shared revenues to your citizens and let them know about the measures you have already taken to reduce spending.

Governor's Local Government Advisory Committee (LGAC) Siscussed Road Maintenance and Local ABC Systems

Governor Beverly Perdue's LGAC* continues to meet quarterly with the latest meeting held January 20. Key questions about transfer of road maintenance to locals and next steps on local ABC system issues were posed to Perdue. Her quotes are below:

Road Maintenance Transfer: I do believe that it is perhaps time for us … to devise different solutions. One size does not fit all. In urban areas, if there are needs that they want to pay for, whether it's on road construction projects or maintenance, then I actually do believe it is time that the Big Brother called Raleigh loosen the chains and allow innovation.... You can't just dump it on local governments that don't have the resources. That is certainly my perspective, and I hope it's the department's perspective. But I can't control everything the General Assembly does. I'm going to ask you all to put the same kind of pressure on your local delegation.

Local ABC System Reform : I am having somebody look at the system. I understand that this is a state driven by local control. I also understand the state owns the product and the license for the product.

I was very distressed to read about a $100,000 retirement (for a local ABC administrator). I find that to be very egregious. For a system to allow that … there is something wrong with the system. I believe that 98 percent of the local boards have high standards and ethics and integrity. I don't believe you should throw the whole thing out because of two or three instances.

*The LGAC consists of both county and municipal leaders, including NCLM Executive Committee members and others.

Local Government Employees' Retirement System Board votes to increase employer contribution

The Local Government Employees' Retirement System Board of Trustees voted January 21 to increase the employer contribution base rate from 4.8 percent to 6.35 percent of payroll for general employees, and 5.27 percent to 6.82 percent of payroll for law enforcement, effective July 1, 2010. Municipal officials will need to include this increase in 2010-2011 budgets. Additionally, the State Treasurer has formed a study commission (The Future of Retirement Study Commission) to recommend possible changes concerning the design and funding of North Carolina's retirement systems (state, local, judicial, and law enforcement) to the 2010 Short Session and 2011 Session of the General Assembly. NCLM staff is working closely with key stakeholders and will keep you apprised of developments.

Annexation for Good Growth Still Under Attack

The NCLM Government Affairs Team continues work on several fronts to address legitimate concerns while maintaining appropriate annexation authority. We are discussing the issue with legislative leaders, as well as working hard to determine alternative solutions for concerned residents that do not restrict necessary municipal authority. NCLM continues to stand by the 20 point proposal suggested to improve the process and address issues. Annexation could be an issue in the short session scheduled for May, although critical budget issues will likely dominate. NCLM remains committed to ensuring well-managed cities and towns and balancing the needs of in-town and near-town residents. Stay tuned for creation of an NCLM Annexation Experts Team (of experienced municipal officials) that will hold workshops and draft proposed guiding principles for consideration by the NCLM Board. NCLM Twenty Point Proposal

Local ABC Systems Receiving Scrutiny

Salary and ethics issues for two local ABC boards have caused widespread discussion of potential reform of the state's ABC system. NCLM staff is working with many key stakeholders. The governor and General Assembly leadership are involved. A select legislative committee is being formed to look at the salary/ethics needs and to consider broader questions of efficiency, consolidation and perhaps privatization. The Governor's Budget Reform and Accountability Commission (BRAC) is also studying the current system. Currently, 158 local ABC Boards operate 405 stores. Privatization could potentially result in the loss of approximately $60 million in annual local government revenue, as well as bring safety and availability concerns to some areas.

Water/Wastewater Infrastructure Funding Gets Attention from Study Commission

With water and wastewater needs totaling billions of dollars over the next 20 years, the General Assembly established the Legislative Study Commission on Water and Wastewater Infrastructure. NCLM has representation on this commission and is leading a key subcommittee. The League and the stakeholders will continue to meet via working groups and committee meetings to find ways to bridge the gap between current statutory funding priorities and local water/wastewater system needs.

Water Quality Standards Likely to Have Huge Local Impact

The N.C. Department of Environment and Natural Resources (DENR) is revising surface water quality standards as required by EPA under the Clean Water Act. The proposed rules will have a tremendous fiscal impact on a wide scope of municipal operations, including wastewater treatment, stormwater, land application of biosolids and development regulations requiring buffers. Please consider joining NCLM's Municipal Environmental Assessment Coalition (MEAC ), which will fund a study of the economic costs of these rules and examine whether the regulations are grounded in science. Thank you to those of you who have already indicated an interest in MEAC participation. For further questions, please contact Erin Wynia, policy analyst, at or (919) 715-4126. Municipal Environmental Assessment Coalition (MEAC)

EPA Stormwater Activities Require More Regulation

EPA is taking initial steps toward requiring more communities to implement stormwater regulations. This initial step is a survey that will be sent to all operators of municipal stormwater systems, collecting information on the programs and soliciting feedback on additional regulation. EPA will likely send out this survey in mid-to-late 2010.

Upcoming Events

DOT Holds Three Prioritization Results Forums

The N.C. Department of Transportation (DOT) will hold a Prioritization Results Forum where the DOT will roll out the initial rankings of projects as part of the first Strategic Prioritization Process. Three forums will be held across North Carolina the week of February 22. The department will share the rankings of highway and non-highway projects at these forums. The regional forums will be held as follows:

February 22 – Alamance Community College in the Auditorium: 1:30 p.m. - 3:30 p.m. The college is located just south of exit 150 on I-40/85 on the eastern edge of Alamance County. The Auditorium is at 1247 Jimmie Kerr Road, Graham, N.C.

February 23 – Catawba Valley Community College in the Auditorium: 1:00 p.m. - 3:00 p.m. The college is located just off Exit 126 of I-40 on Administrative Drive at 2550 Highway 70 SE in Hickory, N.C. The Auditorium is building number 20.

February 24 – Global TransPark Center Training Facility in the Auditorium (Room 142): 10:00 a.m. - noon. This is located at the TransPark Center , 3800 Highway 58 North, Kinston, N.C .

As you know, the department's new Strategic Prioritization Process has been underway since early 2009. The first phase is now complete. The rankings resulting from this initial effort reflect quantitative scoring (based on congestion, safety and pavement needs) and qualitative scoring (1 – 25) from metropolitan planning organizations, rural planning organizations, and the department's divisions. Additionally some highway projects received extra points if they qualified as a multimodal project.

Additional information regarding the prioritization process can be found at

Representatives from the Department's other modes (i.e., bicycle and pedestrian, aviation, rail, public transportation, and ferry) will also be present to answer any questions on how the non-highway rankings were determined.

The agenda will consist of opening remarks by DOT Chief Operating Officer Jim Trogdon, a short presentation covering Transportation Reform, a review of the Strategic Prioritization Process and how the rankings were determined, a release of the rankings of highway and non-highway projects and then an open discussion period.

NCLM Regional District Legislative Meetings Coming to a Town Near You

Get your legislative questions answered while you enjoy a briefing on the 2010 Advocacy Agenda and socialize with legislators from your hometown. For more information, visit: 2010 NCLM Regional Meetings.

  • April 13: Columbia & Lillington
  • April 14: Emerald Isle & Wadesboro
  • April 15: Whiteville & Trinity
  • April 20: Smithfield & Asheville
  • April 21: Newton & Rocky Mount
  • April 22: Haw River
  • April 27: Lenoir

NCLM League LINC Quick Connect Teams

As we prepare for the 2010 NC General Assembly Short Session, we are forming Quick Connect Teams as part of our League LINC grassroots network. These teams will act as first responders when the need arises for quick perspective on the 'real-world' impact of issues. Your participation in a team should not take much time. The teams will be reached only on an 'as needed' basis and primarily by email and conference call. For more information visit: Quick Connect Team.