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League Bulletin

January 16, 2015

A new session of the North Carolina General Assembly began on Wednesday with little drama, as Rep. Tim Moore was chosen as the new House speaker and Sen. Phil Berger was elected by his fellow senators to another term as Senate president pro tem. The House voted to elect Representative Moore by acclamation, with no one else nominated for the post. The House Republican Caucus had selected Representative Moore as its choice for the post following the November election, and one of his rivals for the position at that time -- Rep. Leo Daughtry -- formally nominated him on the House floor on Wednesday.

Representative Moore succeeds U.S. Sen. Thom Tillis as House Speaker, and Senator Tillis was on hand for the opening day. Senator Berger was also chosen as Senate leader without opposition. As chamber leaders, the two appoint committee chairs and members, and play key roles in determining the flow of bills. The House speaker presides during House floor sessions.

The Wednesday session was primarily about formally electing leaders, and the General Assembly won't reconvene until Jan. 28, which will allow the legislative leaders to finalize committees and otherwise begin organizing for a session that will likely run well into July or August. In a news conference after the opening floor sessions, Speaker Moore and Senator Berger both touted the accomplishments of the two previous legislatures under Republican legislative majorities. Senate leader Berger said more work needs to be done as the state continues in a new direction; Speaker Moore said challenges remain but are best met with answers gained with broad consensus.

The League congratulates Speaker Moore and Senate leader Berger and looks forward to working with both on behalf of cities and towns during this legislative session. Read more about the opening day of the legislative session here and here.     

One of the first orders of business at the legislature is the adoption of temporary rules, and those adopted by the House on Wednesday would make a signficant change in how committees operate. Permanent rules will be adopted by the House and Senate later, but they typically mirror the temporary rules. The most substantial change in House rules would require what is known as a proposed committee substitute -- a new version of a bill -- to be distributed electronically to committee members and the bill sponsors by 9 p.m. before it can be considered by the committee on the next day. The practice of unveiling new bill committee substitutes that include major changes with little notice has long been criticized by open government advocates.

Another change by the House would allow a written request by two-thirds of the members of a committee to force the bill to be considered at the committee's next meeting, a move intended to prevent a committee chair from preventing a hearing of a piece of legislation. House leaders said the changes would lead to more transparency and empower all House members. The Senate agreed to minor rules changes. Read more about some of the rule changes here and here.

Senate leader Phil Berger wasted little time before announcing the chairs and make-up of Senate committees for the new legislative session. Many of the top committee chairs will remain the same. Sen. Tom Apodaca will remain chair of the powerful Senate Rules Committee. Sens. Harry Brown, Kathy Harrington and Brent Jackson will continue as co-chairs of the Senate Appropriations Committee. The Senate Finance Committee will see a change: Sen. Jerry Tillman will join Sens. Bob Rucho and Bill Rabon as co-chairs.

Sen. Rick Gunn will also replace Sen. Ralph Hise as a co-chair on the Senate Committee on Pensions and Retirement and Aging. The Senate also has established a new Committee on Workforce and Economic Development. It will be co-chaired by Sens. Chad Barefoot, Ronald Rabin and David Curtis. See the full Senate committee roster here.

The Local Government Employees Retirement System Board of Trustees voted Thursday to lower the employer contributions going to the local government pension fund, a move made possible by investment gains. The change means significant savings for municipalities. The Board agreed to set the FY2015-16 employer contribution rate at 6.67% of payroll, a 0.40% decrease from the current rate of 7.07%. In the same motion, the Board voted to grant a 0.625% cost of living adjustment (COLA) to retirees using only the system's recent investment gains. The COLA increase represents the maximum the Board could award without seeking legislation.

Prior to the vote, the League's new Director of Government Affairs, Rose Vaughn Williams, described to the Board the benefits of the 6.67% rate for local government employers and for the system's long-term stability. We are delighted that the Board approved this lower rate for League members while deciding to provide a fiscally responsibly cost of living adjustment to retirees, doing so by relying solely on existing funds. We thank the Board for supporting our position and extend special appreciation to Trustees Jerry Ayscue and Sally Sandy for making and seconding the motion. Contact: Whitney Christensen

The League and Duke Energy hosted a collaborative summit Tuesday to discuss issues surrounding municipal street lighting.  Participants at the summit received a demonstration of the utility's recently released web-based reporting tool, which was a result of League members' requests regarding the need to ease street light outage reporting. While currently only available to Duke Energy Carolina customers online, the utility stated the tool would be applicable on mobile devices and available to Duke Energy Progress customers in the second quarter of 2015. Participants also gained insight into the League’s engagement with Duke Energy and received information from the company on current rate structures, modernization efforts and future technologies.

At the summit, David Drooz, attorney with the Public Staff of the North Carolina Utilities Commission, complimented the League's participation in ratemaking thus far, stating that efforts over the past year had been effective while noting that rate issues require a lot of expertise. In 2013, the League intervened in the Duke Energy Carolinas rate case before the Utilities Commission. This intervention led to continued discussions between municipalities and Duke Energy, with the objective of finding cost-effective options for municipalities to convert to LED street lighting and modernizing Duke Energy’s outdoor lighting offerings. Presentations from the summit will be available soon. Contact: Sarah Collins

One of the first bills filed in this year's legislative session would affect the condemnation powers of state and local government. HB 3 Eminent Domain would put a constitutional amendment before voters to restrict the use of eminent domain powers, preventing state and local government from taking land for use by private developers. The bill, filed by Representative Chuck McGrady, would also allow property owners to request jury trials in disputes to determine "just compensation" for their property.

Similar bills have been filed during previous legislative sessions, but have not passed the Senate. The League's Government Affairs teams worked with legislators to limit the negative effects on municipalities in those bills, and will again be involved with this legislation. Read media coverage about the bill here. Contact: Erin Wynia

Members of the N.C. State Water Infrastructure Authority (SWIA) examined data Thursday regarding the priority rating system of funding programs administered by the N.C. Division of Water Infrastructure (DWI) in anticipation of possible changes to the rating system. The meeting was held as DWI considers changes intended to better align the programs and ensure that funds are used in a coordinated manner.

DWI staff presented Authority members with charts of information gleaned from the April and October 2014 funding rounds of the Clean Water State Revolving Loan Fund (CWSRF), the Drinking Water State Revolving Loan Fund (DWSRF), and the Community Development Block Grant-I (CDBG-I). The data showed the criteria that had historically most influenced the score of a project and its chances of being funded.

DWI staff stated that it planned to use feedback from Authority members to shape potential changes to priority criteria, which would be presented in draft form at SWIA's March meeting. A final vote is planned in May. In December, League members approved an advocacy goal to seek changes to water, wastewater and stormwater infrastructure funding programs based on specific listed priorities. The Authority's examination of existing priority criteria may provide an opportunity for the member requested changes. Contact: Sarah Collins

A state revenue gap increased in December, but only slightly. According to the General Assembly's Fiscal Research Division, state revenues now stand $199 million below projections. That figure represents just a $10 million rise from the end of November. The NC Insider state government news service reports that State Budget Director Lee Roberts says the state will know much more about where it stands financially once income tax collections pick up through February, March and April. Read more about state tax collections and the revenue gap here.

Longtime state Rep. Edgar Starnes of Hickory has given up his legislative seat and will now serve as senior policy advisor and legislative liaison to State Treasurer Janet Cowell. Representative Starnes was House Majority Leader during the previous legislative session and served 20 years in the chamber. He will replace former Rep. Bill McGee, who retired last summer. Representative Starnes was a vocal opponent of legislation stripping Boone of its extraterritorial jurisdiction, which is now being contested in court by the town. The League thanks him for his many years of service in the General Assembly, congratulates him on his new position, and looks forward to working with him in that role.