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House, Senate Remain Far Apart on Budget

This year's legislative short session looks like it may be anything but short after the divide between House and Senate leaders and Governor Pat McCrory over spending priorities appeared to grow ever wider this week. A new House spending plan dubbed by some as a "mini-budget," a news conference where Governor McCrory and House Speaker Thom Tillis joined together to endorse that plan, and a Senate grilling of McCrory's budget director, Art Pope, were all signs that the House and Senate are far apart in budget negotiations. Senate leaders criticized that spending proposal, which focused on a few key priorities like teacher raises while not addressing the bulk of budget issues, as a "gimmick."

Medicaid, and the required spending level to support it, appeared to be the biggest difference between the two sides, with Senate leaders saying the House Medicaid budget was unbalanced to the tune of $248 million. The House's separate spending bill, approved in a unanimous vote in that chamber this week, would provide for a 5-percent pay raise for teachers, a flat $1,000 pay hike for most other state employees and a 1.44 percent cost-of-living adjustment for state retirees. If Senators were to approve that plan and walk away from the larger budget negotiations -- something that they have indicated they are not interested in doing -- a range of measures would go unaddressed, including many important to municipalities. 

The extension of historic rehabilitation tax credits was included in the House budget, but not in the Senate's version of the bill. Film incentives also could ultimately end up addressed in a final budget bill. The competing budget plans also include provisions affecting the Main Street program, the Drinking Water State Revolving Fund, the Clean Water Management Trust Fund and the Parks and Recreation Trust Fund. Both plans also contemplate putting more money toward the Strategic Transportation Investments program. Budget negotiators were expected to meet through the weekend. League staff continues to monitor the negotiations to address any provisions that may affect cities and towns. News coverage of the budget dispute can be found here and here. Contact: Scott Mooneyham

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Protest Petition Repeal Remains in House Omnibus Legislation

A repeal of protest petitions remained in an omnibus House regulatory bill, surviving a three-hour committee meeting where numerous changes were made to the legislation and an attempt on the House floor to replace an outright repeal with changes to the law's current thresholds. The provision is now a part of SB 734 Regulatory Reform Act of 2014 after House leaders switched the Senate vehicle that they are using to push a grab-bag of regulatory and other unrelated changes. The bill passed the House on Wednesday night, 85-26, and now goes back to the Senate. The provision would repeal current law that allows property owners affected by or adjacent to land proposed for zoning changes to file protest petitions and force a three-fourths vote by municipal boards in order to proceed with the amended zoning. The law currently requires those super-majority votes when either 20 percent of the affected property owners or five percent of those living along the entire buffer of the property sign onto a petition.

Rep. Graig Meyer attempted to amend the provision by preserving protest petitions, but lowering the super-majority threshold to a two-thirds vote and increasing the buffer ownership requirement to 20 percent. On the House floor, the amendment failed 39-72. After the provision showed up in the House legislation last week, League Executive Director Paul Meyer solicited input on the measure from the League's Board of Directors. The survey found that most board members favored allowing protest petitions, but were open to changes in the thresholds. League staff will continue to work with legislators to reflect those concerns as the Senate considers the bill. Contact: Paul Meyer

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Local Bill Strips Boone of Its ETJ

The House of Representatives gave its final approval Wednesday to SB 865 Town of Boone/Extraterritorial Jurisdiction, a local bill repealing the Town's authority to exercise any extraterritorial jurisdiction powers. The approval came less than 48 hours after a motion to approve the bill in the House Government Committee failed by a 12-15 vote. Despite that vote, the committee revived the bill the next day with more members in the room, and by an 18-16 vote it passed out of the committee. It then passed on the floor 65-47 two days in a row and, as a local bill, became law. Multiple legislators defended the Town of Boone and the importance of ETJ authority in Monday's committee meeting, including former Burlington Mayor Rep. Steve Ross and Republican Majority Leader Rep. Edgar Starnes, who attended as a member of the public and a property owner in the ETJ. The League has advocated for reasonable reforms to the ETJ statute but opposed SB 865 due to its immediate repeal of the authority and its impact on only one jurisdiction. The General Assembly passed similar legislation impacting the City of Asheville during its 2013 session. Contact: Erin Wynia
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Quick-Take Condemnation Changes Pass House

A provision that would enhance awards for plaintiffs' attorneys in quick-take condemnation cases at the expense of taxpayers passed the House Wednesday. First introduced last week in the initial version of the House's regulatory reform package, the provision changed slightly in the version ultimately approved by the House. The N.C. Department of Transportation and local governments use the quick-take condemnation procedure to more quickly bring online public infrastructure such as roads, water and sewer, and airport projects, saving project costs. Section 3.2 of the approved bill would rewrite current statutes in such a way that would encourage plaintiffs' attorneys to bring cases to trial, likely delaying projects while running up legal fees. The League remains opposed to this provision, which was identical to a bill that cleared the House last session. Contact: Erin Wynia
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Drone Legislation Takes Flight

A bill that would regulate unmanned drone aircraft buzzed through the House this week; it remains to be seen whether it will get grounded in the Senate. HB 1099 Unmanned Aircraft Regulation would put restrictions on the use of drones over private property, requiring the permission of private property owners under most circumstances. But the legislation includes several exemptions that would allow their use by local law enforcement agencies. Law enforcement agencies would be allowed to use drones for surveillance purposes in areas that are in plain view, when a warrant has been issued, to capture or stop the escape of prison inmates, and to search for missing persons. A provision also would allow their use based on a determination by the federal Department of Homeland Security or the Secretary of the state Department of Public Safety that a high risk exists for a terrorist attack by a specific individual or group. Law enforcement could also use unmanned aircraft to photograph public events.

The bill would allow cities to adopt ordinances to regulate the use of local government property as an area for the launching or recovering of the unmanned aircraft. It also would have the Division of Aviation in the Department of Transportation begin setting up a licensing procedure for the drones. Even once the FAA lifts a federal ban on the commercial use of drones, which is expected later this year, North Carolinians would not be permitted to use them for that purpose until the licensing program is in place or May 31, 2015, whichever comes first. The legislation follows a lengthy legislative study of the issue. News coverage of the legislation can be found here and here. Contact: Whitney Christensen

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Moped Insurance and Registration Bill Still Cruising

House Bill 1145 Registration Required for Mopeds received a favorable report from the Senate Insurance Committee on Wednesday. If enacted, the bill would require mopeds to be registered and their owners covered by liability insurance policies. Although the bill came to the Senate with only the registration requirement and a study of the insurance requirement still intact, the bill was amended by the Insurance Committee to add the insurance requirement back. The insurance study was also retained. Committee members urged the bill's sponsors to have the study consider whether North Carolina should also require the vehicles to be inspected. During the meeting, the bill's sponsor, Representative Phillip Shepard, called on the League's Whitney Christensen to explain to the committee why the issue is important to local governments. The latest version of the bill delays the effective date by one year, to July 1, 2015, in response to a request from the Department of Motor Vehicles to have additional time to prepare for implementation. In typical late-session fashion, unrelated language authorizing the towns of Matthews and Elizabethtown to join the State Health Plan was also added to the bill. If the moped legislation receives the requisite support in the Senate Finance Committee and by the full chamber, its passage will achieve a 2013-14 Municipal Advocacy Goal. The League would like to thank Representative Shepard, Senator Tom Apodaca and Rep. Rayne Brown for their help with this legislation. Contact: Whitney Christensen
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Aesthetics Provision Added to Reg. Reform Bill

A provision regarding municipalities' ability to impose aesthetics and design controls appeared Tuesday in a proposed committee substitute to SB 734 Regulatory Reform Act. The provision was proposed by Representative Nelson Dollar and
matched language in HB 150 Zoning/Design & Aesthetic Controls.  If passed, it would prevent municipalities from imposing design and aesthetic controls on most one- or two-family dwellings. Municipalities often use this authority to preserve the character of existing neighborhoods and bolster the compatibility of new development, furthering economic development in their communities. The League remains opposed to this provision. Contact: Erin Wynia

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Coal Ash Legislation Advances Through Senate

The Senate unanimously passed coal ash legislation Wednesday, ordering all 33 of Duke's coal ash facilities in the State to be closed by 2029. The bill explicitly requires the removal of ash from Duke's "high-risk" Dan River, Asheville, Sutton and Riverbend coal ash sites by August 1, 2019. Despite the unanimous Senate vote, Democrats raised concerns that the bill was not stringent enough. Of interest to municipalities, SB 729 Coal Ash Management Act of 2014 preempts local government from regulating the management of coal ash through ordinances, property restrictions, zoning regulations or otherwise, unless the ordinance is generally applicable to development. The bill also reduces the amount of time allowed for wastewater spill reporting from 48 hours to 24 hours. The bill now moves to the House for its consideration. Contact: Erin Wynia
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Join the Stormwater Association of North Carolina

All stormwater professionals are encouraged to join the Storm Water Association of North Carolina (SWANC). Formed by a group of stormwater managers from across the state, SWANC is the preeminent statewide organization to advocate for the interests of stormwater programs at the N.C. General Assembly and the N.C. Department of Environment and Natural Resources. Membership is open to N.C. municipalities and others. As the leading voice for stormwater interests before state-level decision-makers, SWANC has already influenced stormwater discussions by testifying before legislative committees, contributing comments on stormwater regulatory issues, and participating on state stormwater workgroups. Members also gain from the opportunity for peer-to-peer exchange of information. Contact: Sarah Collins

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Building Inspection Measures Advance in House

The House retained four measures designed to shine a spotlight on how local building inspectors performed their jobs in SB 734 Regulatory Reform Act of 2014, passed Wednesday. Only one of those four provisions changed from what the League reported last week. That altered provision, Section 3.15, attempted to define the standard of conduct to which local building inspectors are held for the purposes of remaining licensed. The League continued to oppose this provision because the definition of conduct contained vague terms such as enforcement of a requirement that was "more stringent than or otherwise exceeds" a state building code requirement. Contact: Erin Wynia

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City Ethics Provision Dropped in Favor of Study

A proposal to require elected municipal officials in the state's largest cities to file economic interest statements and face other ethics requirements has been dropped from a House bill following efforts by the League. Instead, SB 734 Regulatory Reform Act of 2014 (Sec. 3.9) will require that the UNC School of Government and the State Ethics Commission study the implications of having city and county officials file the statements of economic interest. House legislation originally would have required cities with populations above 75,000 as of the last US Census to file the forms. Elected municipal officials in 13 cities would have been affected.

As reported in last week's LeagueLINC Bulletin, League Executive Director Paul Meyer expressed to legislators that the provision might not achieve its intended results and could have unintended consequences. Among other things, a proposed prohibition on the appearance of locally-elected officials in public service announcements, modeled on a similar ban for state officials, could have prevented locally-elected officials from promoting annual festivals or other events that are key to bringing visitors to cities. The League would like to thank House members for agreeing to study the issue rather than pursuing the original provision. Contact: Scott Mooneyham

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League Revives Dormant Political Sign Ordinance Bill

Senate Bill 105 Political Signs/Add Towns to SHP received a hearing in the House Finance Committee on Thursday after spending more than a year inactive in the House Transportation Committee. The League was able to revive the bill, which would achieve a 2013-14 Municipal Advocacy Goal, with the assistance of Representative Julia Howard. If enacted, the bill would allow municipalities to enforce their political sign ordinances on all roads within their corporate limits. The bill would simplify existing state statute, which creates two sets of rules in any municipality that has adopted a political sign ordinance. Current law only allows municipalities to enforce their political sign ordinances on their own streets within their jurisdictions, while authorizing the North Carolina Department of Transportation to enforce the state's rules on all state owned roads within cities. Despite extended debate, the bill received a unanimously favorable report from the House Finance Committee. The proposed legislation then received a favorable report from the House Committee on State Personnel Thursday afternoon and will now be heard in the House Committee on Government Monday. As was the case with the moped registration bill, an unrelated provision allowing Matthews and Elizabethtown to join the State Health Plan was tagged onto the legislation. Contact: Whitney Christensen
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League-Sponsored Pension Spiking Reform Bill Calendared

House Bill 1195 Fiscal Integrity/Pension Spiking Prevention, a joint effort by the League, the Association of County Commissioners and the Office of State Treasurer Janet Cowell, was added to a busy Senate Pensions, Retirement and Aging Committee calendar on Wednesday. Although the Committee was unable to make it to the majority of the bills on its calendar, including HB 1195, the committee's chairmen have assured us that they will reconvene after the July 4th holiday to take up the legislation. If enacted, the bill would protect the fiscal integrity of North Carolina's local government retirement system by minimizing the impacts of the infrequent, but costly late career pension spikes within the system and its local government participants. The bill would also achieve a 2013-14 Municipal Advocacy Goal. Contact: Whitney Christensen
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City-Related Bills Advance in Both Chambers

As legislators look toward the end of this year's General Assembly session, a number of bills impacting cities moved forward this week. Here is a brief recap of those bills, along with links to previous League coverage of the issues.

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Fayetteville Red-light Cameras Get Green Light

Legislation that would allow Fayetteville to restart a red-light camera program moved through the House this week following changes intended to allow the camera program to comply with constitutional requirements. Rep. Rick Glazier of Fayetteville had questioned whether an earlier version of HB 1151 Fayetteville Red Light Changes would meet a constitutional requirement that money from fines and forfeitures go to public education. Glazier, though, drafted changes that attempt to get around the problem by having the City of Fayetteville and Cumberland County Board of Education enter into an agreement in which the school system would first receive all of the money and then remit back to the City that amount required to operate the system. Fines for violators would initially be $75, but would rise to $100 on July 1, 2015. Fayetteville had operated a red-light camera program in the past, but dropped it after the N.C. Court of Appeals ruled in 2006 that a similar program in High Point was unconstitutional. The bill now goes to the Senate for consideration. News coverage about the legislation can be found here. Contact: Scott Mooneyham