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News & Notes: Budget Deal Includes Historic Preservation Tax Credits, Other Items of Municipal Importance

September 14, 2015

This afternoon, House Speaker Tim Moore and Senate leader Phil Berger made public key aspects of a budget deal that includes the restoration of an historic tax credit and will not reallocate any existing local sales taxes. The budget bill document was not expected to be released until late tonight, and many details of the legislation will not be known until then.
 
The plan, though, does include expansion of sales taxes to services involving the repair and installation of tangible property, an idea considered earlier by the House in 2013 but not approved as part of a final tax reform package approved that year. About $85 million will be distributed to county governments and municipalities in 79 counties, with the money going to those mostly rural counties that would have benefited from the earlier sales tax reallocation plan promoted by Senate Majority Leader Harry Brown. The 21 counties and municipalities in counties that would have lost revenue under the earlier plan will not lose revenue under the latest proposal, but will not receive any distributions from the expanded sales taxes.

The restoration of the historic tax credit, with details still to come, represents a major win for cities and towns and follows two years of intense lobbying and media efforts by the League and other groups fighting for its restoration. The League would like to thank legislators for recognizing the importance of the tax credits to economic development projects in cities and towns across North Carolina. We also want to thank legislative leaders for the many meetings and conversations that have taken place regarding the sales tax proposals and revenue flexibility for cities, and for taking into account our concerns.
 
Senator Berger and House Speaker Moore also seemed to indicate that the two legislative chambers are now in agreement on an infrastructure bond and business recruiting incentives, two other issues that are incorporated into League legislative priorities. The bill also is expected to increase Powell Bill transportation dollars to municipalities.
 
As League staff learns more about the budget bill and those provisions affecting municipalities, we will continue to inform members about details of the bill provisions. As additional legislation is considered during the final weeks of the session, the League will continue to push for legislative solutions that benefit all municipalities. Contact: Rose Williams

Posted on September 14, 2015 by Scott Mooneyham