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 February 6 

Legislators get update on budget situation

Collections $625 million below the $9.5 billion target for first six months of fiscal year

  • Second half of year revenues may be more volatile
  • Budget shortfall now 6.6 percent  but expected to grow
  • Shortfall for this year estimated at $2 billion
  • For FY 2009-2010, revenue shortfall estimated at $2.1 billion without spending for Medicaid increases, pay raises or school enrollment increases
  • Downturn in employment began in March 2008 and downward trend continues
  • State's economy likely to slip deeper in recession in 08-09
  • Difficult to see growth until 2010-1011

Managing the shortfall: Gov. Bev Perdue has instructed departments and agencies to present plans to cut spending by 7 percent and be prepared for layoffs.

State health plan needs more than $1 billion over next two years . The plan began running out of money last spring and needs more than $300 million for this year's claims and $1 billion to cover claims over the next two years, according to a report given legislators on Feb. 4.

Continuing to work with legislators on annexation issue. Please share with your legislators the need for fairness on this issue for in-town and near-town residents and that annexation aids in growth management, benefitting all residents. Please be actively engaged on this issue, as changes in annexation laws are likely. Three recent editorials support annexation authority used properly. Don't gut a tool that helps fuel city growth appeared in The Charlotte Observer while Tool for Orderly Growth appeared in the Jan. 30 News & Observer. The Fayetteville Observer ran a Jan. 25 editorial, Get It Right .

Senate committee appointments made. Go to for a complete listing.

Strengthening North Carolina: An Agenda for Our Home Towns – 2009 . This summary, now being distributed to legislators, combines key points of NCLM Advocacy Agenda and NCLM Core Principles and states the commitment of municipal officials to work in partnership with legislators to meet the challenges of these difficult economic times and build an even better North Carolina. Questions about this agenda? Contact NCLM Director of Governmental Affairs Kelli Kukura or call 919 715-3942.

Bill Summaries

SB 68 – No ABC Establishment Within 1,000 Feet of School
Sponsors:  Dorsett
Status:  Senate Commerce
Prohibits location of a new licensed ABC establishment within 1,000 feet of a school (currently 50 feet).


HB 66/SB 10 – New Hanover Annexation Moratorium
Sponsors:  Justice, McComas/Boseman
Status:  House Rules/Senate Held as Filed
Places moratorium on city-initiated annexation in New Hanover County until June 30, 2010.


SB 38 – Municipal District Elections 2011/Census
Sponsors:  Clodfelter
Status:  Senate Judiciary I
Amends 160A-23.1 to apply special rules to municipal redistricting after the 2010 census that apply to elections scheduled for 2011.


SB 54 – Municipal Drainage Service Districts Sponsors:  Soles
Status:  Senate Finance
Adds drainage to the list of purposes for which municipal service districts can be created under 160A-536.  Subject to referendum.


SB 32 – Employers Must Use Federal E-Verify Program
Sponsors:  Snow
Status:  Senate Commerce
Requires cities and counties to register and participate in the federal work authorization program to verify information on all new employees.  Contractors with local governments must also do so.


SB 44 – Appeals of Quasi-Judicial Land-Use Decisions
Sponsors:  Kinnaird
Status:  Senate Judiciary II
Creates uniform statutory provisions for appeals of quasi-judicial land use decisions, including standing, intervention, record, and scope of review.