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In the News

04.11.2014 Duke Energy shows off coal ash ponds in effort to ease concerns of local officials

04.11.2014 Town urges county to keep ad valorem tax distribution

04.11.2014 US Chamber of Commerce backs Tillis in NC race

04.10.2014 AT&T proposal for high-speed fiber network takes step forward

04.10.2014 Conflict between film incentives study, General Assembly review fuels debate over renewal

04.10.2014 Duke Energy suspends use of chemical product that stunts tree growth

04.10.2014 Lawmakers: Rankings largely irrelevant

04.10.2014 Penny-pinching states try to unload local roads

04.10.2014 Raleigh residents could vote on Dorothea Dix purchase in November

04.10.2014 State coastal program awards nearly $600,000 in local government grants for access projects

04.09.2014 For environmental regulators, mission long a moving target

04.09.2014 NC rejects Raleigh's $38 million bid for Dorothea Dix property

04.09.2014 North Carolina personal income tax collections lag

04.09.2014 State wants to keep a portion of Dorothea Dix property

04.09.2014 Webster, WCU lead way toward energy efficiency; LED streetlights being installed

04.08.2014 Early speculators let drilling leases lapse as NC fracking prospects remain uncertain

04.08.2014 Gerry Cohen served NC legislature well for 37 years

04.08.2014 Republicans dominate legislative power rankings

04.08.2014 State review finds errors in film incentive impact study

04.08.2014 Tillis maintains lead in latest Republican U.S. Senate primary polls

04.07.2014 Mebane agrees to continue discussions on transit system

04.04.2014 Drescher: Rep. Marilyn Avila, with courage, pushes for open government

04.02.2014 For the Tech-Savvy With a Need for Speed, a Limited Choice of Towns With Fiber

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Committee Votes in Favor of $100 Privilege License Cap

The General Assembly's Revenue Laws Study Committee voted Wednesday to include in its final report of recommended legislation a privilege license tax reform proposal substantially similar to what it had considered in previous meetings. As currently written, that proposal -- which takes effect July 1, 2015 -- limits the amount of privilege license cities and towns can charge to $100 per physical location of a business, while eliminating many of the caps and exemptions currently in place for the privilege license. Estimates by the General Assembly's Fiscal Research staff indicate that the proposal will cost cities and towns nearly $25 million statewide, though League Executive Director Paul Meyer addressed the committee and said that the actual impact could be higher, given that the State's estimates assume that a full $100 fee will be imposed on every business -- including sole proprietorships with no employees and businesses paying less than $100 under the current system -- and that cities will achieve 100 percent compliance from all the businesses in their jurisdiction.

There was widespread sentiment among committee members that the current privilege license system needs to be reformed, which is consistent with the position that cities and towns voted to include in their Municipal Advocacy Goals for the 2013-14 biennium. Several members expressed concern regarding the revenue losses the proposal would lead to for many cities and towns. Others, such as Rep. Tim Moffitt, said the proposal did not go far enough and instead advocated for a full repeal of privilege license authority. Meyer told the committee that the League's 540-plus members appreciate that legislators have said that they want to help municipalities make up some of the lost revenue through future tax reform efforts, but asked that the committee not take up this matter in the coming short session and instead use the next several months to study the issue further and address privilege license reform and tax reform comprehensively in 2015.

The Revenue Laws committee will meet on May 13, one day before the start of the 2014 Short Session, to vote on its final report of recommended legislation. The privilege license proposal is likely to be given its final approval then. From there, it will still need to be considered by both the House and Senate and signed into law by the Governor before taking effect. The League will continue to be involved in discussions on the issue on behalf of all of North Carolina's cities and towns. For more on Wednesday's committee meetings and discussion, see reports from the News & Observer, WRAL, Time Warner Cable News, and Rep. Moffitt's website.


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Land Use Practices Can Stop Development, Presenters Tell Committee

A series of presentations given Monday by attorneys for private developers recounted numerous state and federal court cases in which an N.C. local government's land use practices prevented development from taking place. Addressing the Committee on Property Owner Protection and Rights, an interim House committee, the speakers each argued for legislators to set in statute clear parameters for when vested rights would occur and whether or not local governments could require impact fees of developers. Further, all presenters argued for elimination of citizen protest petitions. Protest petitions give neighboring land owners a mechanism to force a higher vote threshold for various development decisions by a local board. In discussions following these presentations, committee co-chair Rep. Tim Moffitt stated his desire to codify the case law detailed by the presenters. His aim in doing so, he said, was to provide business and property owners long-term certainty in how they could develop their property. The committee may meet several more times this year and may propose legislation for the 2015 Long Session. Read about the focus of this committee's first meeting in "Committee Places 'Excessive' Land Use Regulations Under Microscope" (March 7 LINC'ed In).
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Legislators Recommend Lifting Moratorium on Local Environment Ordinances

The Environmental Review Commission (ERC) recommended lifting a de facto moratorium on local government environment ordinances as part of its final suite of environmental bills approved for introduction in the upcoming Short Session Wednesday. The League members argued in favor of lifting the moratorium, pointing out the numerous unintended consequences of restricting local authority to enact environment ordinances. Most of the recommended legislation stemmed from four interim study committees on which the League participated over the past six months. In addition to the proposal to eliminate the environment ordinance moratorium, the committee voted to advance legislation that would:

  • Study interbasin transfers
  • Study incentives for water system interconnection
  • Shorten the time period for notifying the public about unauthorized wastewater spills
  • Clarify how state law treats non-paved surfaces for stormwater purposes
  • Standardize procedures for State and local development plan reviews, when those plans were designed by a professional engineer

The ERC's vote did not include any significant legislation in response to the Feb. 2 coal ash spill on the Dan River; the ERC scheduled a separate meeting for April 22 to discuss that topic in-depth.


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Reinstatement of Elevated LPA Tax Collection Fee Moves Forward

Proposed legislation prescribing an increase in the fees paid by local governments to License Plate Agencies (LPAs) under the state's new Tag and Tax Together program received a favorable vote from the Revenue Laws Study Committee on Thursday. Legislation from the 2013 Long Session set the property tax with registration renewal transaction fee at $1.06 from September 1, 2013 through March 1, 2014 and $0.71 thereafter. If enacted in its current form, the proposed legislation would revert the fee to the $1.06 rate indefinitely and would also be applied retroactively to March 1, leaving local governments with a bill for the difference between the two rates between March 1 and the bill's date of passage. A detailed summary of the bill can be found here. An amendment to the bill, offered by Rep. Becky Carney, directed the Committee to reexamine the fees in light of a forthcoming report by the Department of Transportation and make a formal recommendation on per transaction compensation fees to the 2015 General Assembly. Both the Carney amendment and the bill as amended received unanimous favorable reports from the committee.
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Register for Town Hall Day on June 4 Now!

Registration is now open for the League's annual Town Hall Day, scheduled this year for Wednesday, June 4. Town Hall Day is the premier advocacy event for all of North Carolina's cities and towns, when hundreds of municipal officials from across the state come to Raleigh to meet with legislators and discuss issues of interest to their community. This year's agenda will feature a legislative briefing from League staff, meetings with key legislators and state agency officials, and an evening reception. Click here to register now, and we will see you here in Raleigh in June -- if not before!
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Former Sen. Dan Clodfelter Chosen as New Mayor of Charlotte

Former State Senator Dan Clodfelter was chosen by Charlotte City Council members as the city's next mayor Monday night, and on Wednesday he was sworn into the position. Clodfelter becomes the city's fourth mayor since last spring, but Clodfelter has said that he plans to bring stability to the office and let the residents of Charlotte judge his job performance. "To the council again I want to say whether or not you've chosen wisely on this you and the community at large now will be the judges as we move forward," Clodfelter said, according to the Associated Press, via the Charlotte Observer. "All I can do is pledge to you and to our beloved community that I will do all that I am able to vindicate your choice and to repay the confidence that you have placed in me." The League enjoyed a strong working relationship with Mayor Clodfelter during his time in the Senate, and we congratulate him on his selection as mayor and look forward to continuing to work with him in the future. For more on Mayor Clodfelter, read about his role in the discussion over control of the Charlotte airport; his thoughts on a number of items, including the local privilege license tax; and his meeting on Thursday with Gov. Pat McCrory.


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Public Enterprise Committee Probes Limits of Officials' Actions

In an agenda item titled "Overview of Municipal Corruption Investigatory Practices," House members explored circumstances under which local officials' actions could rise to the level of criminal corruption Monday. This week's discussion in a meeting of the Committee on Public Enterprise Systems and Use of Funds tracked previous committee debates about whether sufficient oversight and accounting controls existed to monitor the financial practices of public enterprise systems such as water and wastewater systems. Specifically, committee co-chair Rep. Tim Moffitt referred to systems' practices of allocating costs -- such as human resources or legal services -- between an enterprise fund and a local government unit's general fund as a "slush fund" for local officials. He questioned the special agents presenting on behalf of the State Bureau of Investigation about whether they would consider such practices corruption or acceptable accounting practices. The committee will continue its work throughout this year and may make recommendations for legislation in the 2015 Long Session.
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ERC Approves Refined Proposal to Standardize Review of Engineering Plans

The Environmental Review Commission (ERC), an interim legislative oversight committee, approved a refined proposal Wednesday to standardize State and local review of engineering plans such as stormwater, sedimentation/erosion control, and water and wastewater system designs. The recommended legislation, first unveiled last month, contained numerous suggestions for improvement made by the League. For example, the original proposal would have required state and local agencies to remove the word "engineer" from all job titles when the person performing the job did not hold a Professional Engineer license. The League suggested a change, which was accepted by the ERC, that would instead distinguish between job titles used for position classification purposes and the "working job titles" used by plan reviewers to explain their job to the public. Other aspects of the proposal would require State and local programs to standardize the processes they used to handle disagreements between plan designers and reviewers. Finally, the proposal contained a four-year reporting requirement for these State and local programs. The proposal came in response to concerns by the Professional Engineers of North Carolina, an advocacy trade group, that state and local reviewers often exceeded their authority in requiring changes to these plans. Read more about the previous discussion of this proposal in this March 14 LINC'ed In article.
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Proposal Would Extend Public Bonding Standards to Non-Government Lessees

In a meeting Monday, the Legislative Research Commission's House Committee on Mechanics Liens released its report to the 2014 General Assembly. The final report included a recommendation that lessees of government property require the same performance and payment bonds from its contractors or construction managers as the government lessor would itself be bound to require under current statute if the government owner requires the improvements or repairs on the leased public property. If enacted, the effect of this proposal would be to hold non-government lessees of government property to the same bonding standards that governments are already subjected to. The bill would not apply to public-private partnership contracts or projects where the lessee itself initiates the improvements. The recommendation was accompanied by suggested legislation on the topic, which is also included in the report.
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Amended Returns' Impact on Utility Tax Distributions Clarified

Clarifying legislation given a favorable vote by the Revenue Laws Study Committee Wednesday details how amended tax returns would impact the distribution of sales taxes on electricity and natural gas that cities will receive in the future. As described in the League's FY14-15 Revenue Projections Memo and elsewhere, going forward cities will receive a percentage of the proceeds from the sales tax on electricity and natural gas. The amount of utility franchise distribution received in each quarter of the current fiscal year (FY2013-14) will serve as the baseline amount cities will receive in the future, with the intention being that future sales tax revenues will be sufficient to provide every city with at least the amount they receive in each quarter of the current fiscal year. Additional revenues beyond that will be distributed statewide on an ad valorem basis. The legislation approved this week clarifies that if an amended return that affects FY13-14 distributions is filed at any point in the next three years, then a city's baseline amount will be recalculated and that recalculated amount will be used as the "baseline" going forward. If the amended return requires a city to receive additional money, that money will be drawn from the state's general fund. For questions on this legislation and utility tax distributions in general, please contact League Director of Research & Policy Analysis Chris Nida.