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LINC'ed IN: December 7, 2012 

Out and About in North Carolina

Proposed Reform of Unemployment Insurance System and Repayment of Federal Debt Involves Cities - A proposal to accelerate the repayment of approximately $2.8B unemployment insurance debt owed to the federal government by  mid-year 2016 was unveiled in the Revenue Laws Committee this week.  In addition to significant reductions in unemployment benefits (both duration and weekly maximum), the draft legislation significantly alters how benefits will be paid by city governments.  Cities may continue to pay benefits by reimbursement, but will be required to: (1) Fund a 1% escrow of “taxable income” from which unemployment benefits will be paid (over 6 quarters, beginning July 1, 2013); (2) Pay a 20% state “surcharge” whenever the Unemployment Insurance Trust Fund balance is below $1Billion (beginning July 1, 2013); and (3) File quarterly reports, along with required payments to the ESC.  In total, municipalities would be required to pay approximately $25M over the next three fiscal years if the proposal were to become law, as well as escalating amounts in future years, resulting from city payroll increase. We are reviewing the extensive bill language to determine other impacts on municipal human resource functions, and expect the final Revenue Laws  report to include this proposal, to be voted on at the January 8, 2013 Revenue Laws meeting. Contact: Paul Meyer

Transportation Oversight Committee Meets - The Transportation Oversight Committee met today and discussed a significant number of items, including a review of NC’s infrastructure maintenance condition report.  And as expected, the health of the secondary road system was the lowest in the state.  This in many ways explains why cities are voluntarily paying to improve the conditions of state owned secondary roads inside many cities.  In addition the Committee accepted a report to require the NC Railroad to make annual dividend payments to the state of North Carolina. Contact: Paul Meyer

Transportation Reform Continues to be Mentioned - In Raleigh, rumors continue to churn about how the NC transportation funding system will be overhauled.  With a prioritization process by DOT now complete, we expect discussions to begin on the funding allocation process. And with transportation resources continuing to fall below needed levels, cities who are currently backfilling state maintenance and enhancement deficiencies on state roads within city boundaries with local money, are likely to request new local option revenue sources to stop the bleeding.  At this point in its advocacy development process, the League has a goal to provide local transportation revenue options for city governments.  Contact: Paul Meyer

N.C. Cities Turn Out for Nutrient Discussions - Wastewater and stormwater representatives from central North Carolina cities were strongly represented at a public meeting regarding future steps for nutrient regulation in the state held in Raleigh Tuesday. State water quality regulators organized the meeting, the first of three to be held across the state, to present an overview of possible strategies to control nutrient impairment of waters across the state. City representatives formed a strong contingent at the meeting and were able to ask questions of regulators. Their presence reinforced the high priority League members place on the issue of nutrient regulation. The next two public meetings will take place in Huntersville and Wilmington. Please consider sending representatives from your city or town to one of those meetings (RSVP here). For more background on this effort, read “State Regulators to Hear from Public on Nutrient Plan” in the League’s November edition of EcoLINC. Contact: Erin Wynia.

League Comments on Impaired Waters Determinations - A document outlining the process of making impaired waters determinations needed more detail and flexibility, the League wrote in comments submitted November 26. The League's suggestions came in response to a public comment period on the document, called the "use assessment methodology." State regulators use the methodology along with water quality data and standards to determine whether or not waters are impaired. Given the consequences to municipalities of having a water body included on the state's impaired waters list, the League had long urged a public forum to discuss the adequacy of the methodology. Read more about the comments and next steps in this LeagueLINC blog post. Contact: Erin Wynia.

Regulatory Reform Top on Legislative Agenda - With the election behind them, lawmakers now routinely mention regulatory reform, particularly of environmental regulations, as a top goal of lawmakers next session. Speaking to a Greensboro Kiwanis Club recently, Senate President Pro Temp Phil Berger listed regulatory reform as a focus for next session, the Greensboro News & Record reported. The Raleigh News & Observer reported a similar priority for the House, with staff to House Speaker Thom Tillis promising an effort to roll back regulations next session. House Majority Leader Paul Stam also told reporters that he considered regulatory reform as a “major focus for 2013,” stating legislators would count on business owners to identify the types of environmental regulations to target for reform. As with the regulatory reform bills from last session (refresh your memory with this article from the League’s July edition of EcoLINC), the League anticipates future reform packages to bundle dozens of separate changes to environmental laws. Contact: Erin Wynia.

Call on Us - The Government Affairs team is out and about visiting with city officials who are hosting meetings with their local legislative delegations to develop and enhance relationships, discuss city matters and give legislative updates. In just the past week, we've traveled to Charlotte for a regional meeting of mayors and Edenton for a meeting of nearby towns. We are glad assist in your local legislative outreach, just give us a call. Contact: Jennifer Webb

What's Up in DC

A Chance At Marketplace Fairness Slipped Away - The Marketplace Fairness Act (S. 1832), which is estimated to produce a combined State and local revenue of at least $213 million (and likely much more) in revenue for North Carolina, was filed last week on the 2013 National Defense Authorization Act, giving the issue a glancing shot at passage. However, in the end, it was not offered on the actual bill because Senate Finance Committee Chair Max Baucus and Ranking Minority Member Orrin Hatch both have issues with the bill.

The Marketplace Fairness Act grants states the authority to compel online and catalog retailers ("remote sellers"), no matter where they are located, to collect sales tax at the time of a transaction - exactly like local retailers are already required to do.

Avoiding the 'Fiscal Cliff' - North Carolina leaders are considering how the 'fiscal cliff' will impact our state's citizens and businesses. Several programs that provide grant and loan funding to local governments would be cut if sequestration takes place. More information on the programs affected and the size of the reductions can be found at Cities' Message to Congress: Sequestration is Bad Policy ( http://www.nlc.org/media-center/news-search/cities’-message-to-congress-sequestration-is-bad-policy

NC Senators Divided on Fiscal Cliff Solution

What the Fiscal Cliff Means for state and Local Budgets

What is the Fiscal Cliff

Grand Deficit Prize Glitters Within Reach for Obama and Boehner

Coming Soon

General Assembly - Full Legislative Calendar

DWQ Nutrient Criteria Implementation Plan public meeting, December 12, 1:30 pm, Lee Dukes Water Treatment Plant, 7980 Babe Stillwell Road, Huntersville

Environmental Review Commission, December 13, 9:30 am, Legislative Office Building Room 643, Raleigh

State Water Infrastructure Commission, December 14, 10:00 am, Green Square, Raleigh

DWQ Nutrient Criteria Implementation Plan public meeting, December 17, 1:00 pm, New Hanover County Government Building, 230 Government Center Drive, Wilmington, NC

Mining & Energy Commission committees, December 18, 9:00 am, Archdale Building Ground Floor Hearing Room, Raleigh

Mining & Energy Commission, December 19, 9:00 am, Archdale Building Ground Floor Hearing Room, Raleigh

Joint Administrative Procedure Oversight Committee, December 19, 9:00 am, 643 Legislative Office Building, Raleigh

Wetland & Stream Mitigation--Legislative Review Commission, December 20, 9:30 am, 643 Legislative Office Building, Raleigh

Nutrient Scientific Advisory Board, January 4, 9:30 am, Triangle J Council of Governments Meeting Room, Durham

N.C. General Assembly reconvenes, January 9, 9:00 am, Legislative Building, Raleigh

Environmental Management Commission committees, January 9, 9:00 am (tentative), Archdale Building Ground Floor Hearing Room, Raleigh

Environmental Management Commission, January 10, 9:00 am (tentative), Archdale Building Ground Floor Hearing Room, Raleigh

NCLM Advocacy Goals Conference, January 24, Raleigh Convention Center, Raleigh -  Pre-Game Social January 23