Skip Ribbon Commands
Skip to main content

League Bulletin

May 24, 2019

​WHAT HAPPENED: Another mostly quiet week, at least as compared to those of recent months. We're now past all the hard bill deadlines at the General Assembly. CityVision (the League's big, annual conference covered in last week's Bulletin​) is behind us, too. What's left? Oh, yes -- the state's master spending plan.
WHAT IT MEANS: The House in early May approved and passed a $24.5 billion budget ​to the Senate, which is now working out its version of the plan and is likely to differ on details.
ON TAP: The Senate's budget is expected next week, which would be the second milestone toward a compromise document the chambers can agree to send the governor for signing. But there's a wrinkle. Both the House and Senate remain in Republican control, but this time without the veto-proof majority that in the past has overridden differences with the Democratic-controlled governor's office. If Gov. Roy Cooper has enough of an issue with the budget this year that he vetoes it, there may be more work to do.
THE SKINNY: Various clues, including lawmakers' attention to items (like regulatory reform) that typically come up in the latter part of the legislative session, tell us we're on the homestretch -- though it's anyone's guess, given the factors on the ground, as to when the 2019 long session will actually close. North Carolina's legislature isn't held to a session deadline like in other states. What the governor does with the budget, and what priorities remain for lawmakers, will determine how long the homestretch really is this year. In the meantime, we still have bills to follow. Read on for highlights.

​The co-chairs of the House Municipal Caucus, Reps. Gale Adcock and Steve Ross, led this week the first hearing on HB 557 Municipal Omnibus Bill. The caucus chairs co-sponsored the bill, which would change eight different areas of state law to cut red tape and increase administrative efficiency for cities and towns. The House State & Local Government Committee gave the bill a favorable report Wednesday after robust discussion. The bill included items related to two policy priorities identified by municipal officials. The first would extend the notification a county must give the municipalities within it when the county commission switches the method it uses to distribute sales tax among the municipalities, from two months prior to the new fiscal year to seven months prior. The second would expand affordable housing assistance available from municipalities with such programs. Other measures in the bill include eliminating a match requirement for municipalities in the most economically distressed counties when applying for grants from the Parks and Recreation Trust Fund; allowing municipalities to annex NCDOT right-of-way; allowing local governments to cease tax collection efforts of unpaid taxes after 10 years; ensuring finance officers are not personally liable if a vendor failed to follow required notifications for automatic contract renewals; reducing public hearing requirements for certain expenditures made within a municipal service district; and correcting the system development fee law to ensure that fee revenues may be spent on debt for certain capital expenses. The bill next moves to the House Finance Committee.

Up for discussion in the Senate Agriculture, Environment and Natural Resources Committee​ this week was SB 536 Water/Wastewater Public Enterprise Reform, the work of a yearlong legislative study committee charged with looking at a variety of issues related to rates of public enterprise utilities. Focus eventually narrowed to the more-than $17 billion of water and sewer infrastructure needs statewide and the continued financial viability of certain utilities based on their infrastructure needs.
SB 536 would do many things to try to address water and wastewater utility viability, including creating a new grant program, administered by the State Water Infrastructure Authority, called the “Viable Utility Reserve Fund.” In committee talks, however, Senators said they were still trying to determine the best financial mechanism to fund these grants, noting that the existing method in the bill -- a $1 monthly surcharge to be paid by every wastewater and water customer of a public water or wastewater utility – may not be the best method. Other sources reported this week that the surcharge approach would be removed from the bill.
In creating the grant program, it directs the type of water and wastewater system projects it can fund, including assistance for physical interconnection of systems; rehabilitation of existing infrastructure; decentralization; and the study rates, asset inventory, merger and regionalization options. In their discussions about system challenges, senators noted the changing demographics of North Carolina; the lessening of federal funding to utilities; and the inability in some areas to charge ratepayers what is needed to keep the system in good condition. They also talked about the fact that merger, consolidation, and regionalization is often impracticable because a utility in good financial standing will not burden its existing ratepayers by merging with a struggling utility. Committee talks recognized that there should be a structure in place to give viability grants to utilities to get them back to a baseline where merger, regionalization, or a sale of the system could even be possible without mandating such measures. 

In other bills moving on Jones Street, a Senate committee on agricultural and environmental issues this week advanced a regulatory reform proposal that, among other changes, would repeal the statewide ban on discarded computers and televisions from landfills. SB 553 Regulatory Reform Act of 2019​ is now in the chamber's Rules Committee (a formal stop for any bill active in the Senate before it can reach the floor) after the Senate Agriculture, Environment and Natural Resources Committee gave approval on Thursday. Media coverage conveyed from bill sponsor Sen. Andy Wells that today's flatscreens aren't as hulking as their boxy predecessors, and that their recycling isn't always in high demand, "so it would be better to allow local governments to dispose of electronics in lined landfills if they want, rather than leave them piled up," as the Raleigh News & Observer reported of the discussion points. WNCT quoted​ an opponent of the measure concerned with the proper handling and environmental safety of such devices, which may contain hazardous componentry, according to the report.
The full Senate this week approved a separate bill that would make changes to the duties of local government finance officers. Near the end of HB 233 State Auditor/Local Finance Officer Amends is an added power to contract with outside entities like certified public accountants, bookkeeping firms, councils of government and other units of government to ensure the officer's duties are fulfilled. The Local Government Commission could also adopt rules setting minimum qualifications for finance officers under the proposal and could require a local government or public authority to contract with outside entities if found otherwise deficient in carrying out duties. The bill originated in the House and received Senate amendments before the latter chamber's approval, so it has to go back to the House for concurrence. That's on the House calendar for May 28.
And a House committee has signed off on a bill that would establish a North Carolina Gaming Commission with oversight on areas like the lottery, fantasy sports, bingo and similar activities, and would study sports betting, recently favored in a U.S. Supreme Court decision​ overturning a law that stopped states from authorizing it. It's still unauthorized in North Carolina, but bill sponsor Rep. Harry Warren told the House Commerce Committee this week, during light debate over HB 929 Gaming Commission, that activities like fantasy sports gaming are popular regardless and ought to have some accountability in this state. Rep. Deb Butler during the discussion hinted at the substantial revenue stream governments could tap from authorized gaming. The bill has more committee stops before it can reach a floor vote.

Knowledge is a powerful driver for the 2020 Census -- the big, decennial headcount loaded with determinants for communities of all sizes -- according to survey results​ the U.S. Census Bureau just released. "Knowing that the census guides how much money a community gets from the government is the most important reason for people to respond to the census," the Bureau reported this week in analysis of the new survey, which sought to better understand current public perception. The survey found that less than half of respondents knew the census was the basis for how vast amounts of public money is allocated. Further, about 40 percent felt it didn't matter whether the 2020 Census counted them. Persons ages 18-34 responded as being the least likely to think their participation in the census matters. Additionally, 1 in 4 respondents shared concerns about confidentiality with the information they'll be asked to provide, though the Bureau frequently touts its safety and security protocols. Law also protects census results. 
"The focus groups suggest that encouraging response from trusted voices in the community may increase participation among people with the greatest distrust in government," the Bureau says, echoing points on the importance of local-level leaders (elected or not) informing residents of the benefits of participation. The League's Municipal Equation podcast early this year released an episode looking at the 2020 Census and how it affects communities, with insights from the Census Bureau, National League of Cities, state government and academia. Listen, download or share that episode online.