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League Bulletin

May 12, 2017

The state Senate unveiled and passed its proposed biennial budget this week, kicking into higher gear the crafting of a compromise spending plan between the House and Senate that would go to the governor for consideration. Senate budget writers said their $22.9 billion plan represents a 3.75 percent increase over actual projected spending from last year's budget. Senate leader Phil Berger of Eden and colleagues, during a Wednesday press conference, highlighted the proposal's relief for victims of Hurricane Matthew, expansion of the rainy day reserve fund, investments in education, income tax rate reductions, and economic development focuses. Click here to view the Senate plan, which the chamber passed early Friday on a 32-15 vote.

"I commend my Senate colleagues for crafting a balanced budget that delivers nearly $1 billion in tax relief to the middle class and our state’s job creators, ensures 99 percent of taxpayers pay less or no state income tax, increases teacher pay, generously funds our public schools and helps rebuild communities devastated by Hurricane Matthew -- all while saving for a future rainy day," said Senator Berger in a news release. (A House version of the budget will come next, and the chambers will develop a compromise. Details of Gov. Roy Cooper's $23.4 billion recommended budget were reported in this bulletin on March 3.) The League will highlight several items of importance to local governments below in this edition of the Bulletin.

Click here to view or download a staff-prepared chart of Senate budget items affecting cities and towns.

Grants for downtown improvements and other municipal economic development efforts appear in the Senate budget as lawmakers continue to recognize the value of shovel-ready projects, as communicated to them directly by local officials and partners. It fits the spirit of an advocacy goal set by cities and towns for this year to support legislation that will provide sufficient funding at the state level for incentive programs to grow jobs and the economy.

The Senate proposal includes $450,000, mostly for specific projects, under the Main Street Solutions fund. It also programs $2.8 million for downtown revitalization and economic development grants in numerous, specific municipalities all over the state. For one, the City of High Point would receive $1.5 million as a challenge grant (in which the city must raise a match from private sources) for the development of a design factory downtown, to serve as a makerspace for entrepreneurs, designers, manufacturers and artisans. The allocations show the value in spreading awareness of the importance of local projects.

The plan also includes funds, which would be available to local governments as loans, for a new Site and Building Development Fund. The fund would "support site aquisition and onsite preparation for attracting major manufacturing employers," a committee document explains. The plan would transfer $10 million from another account into the new fund and appropriate to it an additional $2.5 million for a nonrecurring $12.5 million total. The loans could aid new buildings, renovations, upfits, water/sewer improvements, site access, or other measures toward marketability of the property.

The Senate budget additionally sets out Community Development Block Grant funds for each of the next two program years, with $21.73 million for infrastructure, $10 million for neighborhood revitalization, and $10.7 million for economic development. It also provides flexibility in the spending of deobligated funds. An advocacy goal of cities and towns is to seek legislation to increase state-level funding for municipal infrastructure needs. In line with that, the budget would give additional funds to the Clean Water Management Trust Fund (CWMTF) to support grants to address water quality and infrastructure. It would bring the total appropriation for CWMTF grants to $16.2 million in fiscal year 2017-18 and $13.5 million in 2018-19. Additionally, a section of the plan would direct the Department of Environmental Quality to allocate the $15.6 million appropriated in 2017-18 and funds carried forward from previous fiscal years to specific water resources development projects, including those of many cities and towns. Many of these projects are storm-related.

In other infrastructure funding, the budget directs $100,000 of water and wastewater infrastructure grant funding money to the North Carolina Policy Collaboratory at UNC Chapel Hill to develop and deploy a predictive analysis tool to assess the condition of municipal water and wastewater infrastructure within the state. The collaboratory is to consult with all the large players that are already involved in this issue: Local Government Commission, the Division of Water Infrastructure and the Environmental Finance Center at UNC Chapel Hill, and to build on the recently released Statewide Water and Wastewater Infrastructure Master Plan. It is also supposed to assist in identifying potential opportunities for regionalization or privatization of the infrastructure.

League staff members met with N.C. Department of Transportation (DOT) Secretary Jim Trogdon and members of his leadership team last Friday, discussing important DOT initiatives, including many contained in the Senate budget released and approved this week. Sec. Trogdon, who has decades of experience with DOT, has prioritized initiatives to boost local transportation projects, and cities and towns thank him and Senate leaders for pursuing budget changes that would direct more funds to local priorities. These include:

  • $40 million for a new Mobility/Modernization Fund for immediate need projects, including those that have a high impact within a transportation division, reduce congestion, or further economic development;
  • $12 million for small transportation projects, including roads and bridges, industrial access roads, and spot safety projects such as pedestrian walkways;
  • $30 million for shovel-ready projects at the state's commercial airports, with an additional appropriation to assist Raleigh-Durham International Airport replace a runway that accommodates international flights. (Read a full report on that project in this News & Observer article.)

The Senate budget also contained other noteworthy transportation policy items that affect cities, separate from those the League discussed with Sec. Trogdon last week. Those items included one provision that would withhold Powell Bill funds for any city that did not file the required annual Powell Bill statement, and another that would require the complete return of Bicycle and Pedestrian Planning Grant awards if any project identified in a plan created by those awards was not completed within six years, beginning with grants awarded after July 1, 2017.

A pilot project funded in the Senate budget would establish a "Quick Response Team" to address the needs of opiate or heroin overdose victims not getting follow-up treatment. The Department of Public Safety would carry this project out with specific local  governments including Wilmington, Jacksonville, and Hickory. Members of the response team would be firefighters, police officers, medics and potentially other law enforcement professionals. Combatting opioid abuse is an expressed priority for many municipalities. "We've heard a lot of discussion here tonight on the opioid abuse and how it is truly a national and state ... emergency," Sen. Brent Jackson of Autryville, who on Friday introduced an amendment expanding the proposal, which initially focused on one city, told news outlets. Another amendment, from Sen. Louis Pate of Mount Olive, would set up additional funding for medications to reverse opioid-related overdoses.

A separate section of the budget would direct a legislative study on the impact of state and local law enforcement efforts on the receipt of seized and forfeited assets. Another would allow all company police agencies to enter mutual aid agreements with the governing board of a municipality or, with the consent of the county sheriff, a county to the same extent as a municipal police department. It also allows all company police to provide assistance to a law enforcement agency at the request of the head of that agency regardless of whether there is an agreement in place.

Senate leader Phil Berger at Wednesday's budget unveiling touted the plan's inclusion of $150 million more in disaster relief funding meant to help victims still strugging with the effects of last year's Hurricane Matthew. It follows the $200 million that the legislature approved in the Disaster Recovery Act of 2016.

A separate provision would aid coastal homes and businesses with the establishment of a new Coastal Storm Damage Mitigation Fund. It would consist of general fund appropriations, gifts, grants and other resources for beach nourishment, artificial dunes and other projects to reduce ocean storm damage. The funds would have varying cost-sharing conditions.

The state's Film and Entertainment Grant Fund is continued in the Senate's budget proposal, with $15 million recurring annually. The fund is meant to "encourage the production of motion pictures, television shows, and commercials to develop the filmmaking industry within the State," a budget document explains. It notes that available expenditures for fiscal year 2017-18 are projected to be $30 million, which includes the $15 million appropriated and a projected fund balance of the same amount. Legislators from southeastern North Carolina, in areas impacted by the film industy, give their thoughts on the funding in news stories here and here.

Bill sponsors unveiled a significantly revised version of an industry-backed bill concerning local regulation of small cell wireless facilities Wednesday, offering House members their first-ever opportunity to consider such legislation. The new draft of HB 310 Wireless Communications Infrastructure Siting included numerous revisions negotiated by the League. City officials appreciate the willingness of primary sponsors Reps. Jason Saine, John Torbett, and Michael Wray to incorporate these important changes.

In contrast to the filed version of the bill, the latest draft included authority for cities to apply zoning standards to this technology, including for reasons like public safety, aesthetics, and spacing between facilities. The draft also spelled out the permitting process and associated fees for allowing small cell facilities in the public right of way. These facilities typically consist of an antenna, utility pole, and ground-mounted equipment box. Importantly for cities, the revised bill limited the height of the facilities to a 50-foot pole plus an additional 10-foot antenna. The House Energy & Public Utilities Committee plans a vote on the bill Wednesday, and the League appreciates your feedback before then. Please send your comments to Legislative Counsel Erin Wynia.

One of the most popular bills of the session in terms of sponsorship advanced through committees this week and separately found a place in the Senate's budget proposal. HB 280 Juvenile Justice Reinvestment Act, colloquially known as the "Raise the Age" bill, won unanimous approval in a House judiciary committee on Wednesday and passed the House Appropriations Committee the following day. The bipartisan bill, supported by the League's Executive Committee, would chiefly amend law to consider 16- and 17-year-olds as juveniles, not adults, when charged with crimes, except in certain felony cases. The bill, from Rep. Chuck McGrady of Hendersonville, has nearly 70 cosponsors and is expected next on the House floor. The Senate's version of the budget, released to the public this week, also includes raise-the-age language, eyeing implementation by December 2020. Click here for news coverage.

Click here for the latest episode of Municipal Equation, the League's biweekly podcast about municipalities in changing times. The rundown: Do autonomous vehicles, or driverless cars, still sound futuristic to you? Even if deployments are planned for just a few years away? That's right, this technology is developing so quickly that it's catching a lot of local policymakers off-guard. Experts say it's time for cities of all sizes to put some serious thought into what will be a major change in how we get from A to B. For cities, that means understanding the implications, considering the unknowns, and thinking about policy. But with the technology so fresh and incomplete, where would a city even begin with that? That's our focus on this episode. We're joined once again by Nicole Dupuis from the National League of Cities, which just released a report with guidance for cities on the subject. According to Dupuis, "Absolutely, we need to take this seriously." And another question: Will future generations know the feeling of passing a driver's test? There's a lot to ponder on this episode. Click here for all past episodes and here to subscribe for free on iTunes. Send feedback and ideas for future episodes to host/producer Ben Brown.

Registration closes at midnight tonight for the May 18 Infrastructure Symposium that the League and partners have assembled for municipal elected officials, managers, attorneys, engineers, utilities directors, economic development officials and more. The program includes a mobile tour, lunch keynote address, collaborate panel conversations, and a networking reception. Click here for full details.

Hickory Mayor Rudy Wright

The League was stunned and saddened on Thursday to learn of the passing of Rudy Wright, Hickory's longtime mayor and a former League board member. Friends and colleagues will remember Mayor Wright as an upbeat soul dedicated to the community in which he served as mayor for nearly 16 years. "He was always looking on the positive side of things, and sharp mind, sharp wit and he was a pleasure to work with," the Hickory Daily Record quoted of Councilwoman Jill Patton, whose comments mirrored several across the city and beyond. U.S. Rep. Patrick McHenry released a statement expressing appreciation for all Mayor Wright did for the community. "Mayor Wright was synonymous with Hickory, displaying his love for the city during the entirety of his nearly two decades of service as mayor," the congressman said. In addition to his local roles, Mayor Wright was a past chairman of the League's General Government Legislative Action Committee and was until his passing a member of the state's Local Government Commission. The League's thoughts and prayers are with Mayor Wright's family and friends during this difficult time.