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League Bulletin

July 31, 2015

The House Appropriations Committee met this week, primarily to discuss differences between the House and Senate versions of the budget. In addition to hearing presentations from legislative staff (you can find all of the materials from the committee meeting here), the committee also invited members of the public to share their thoughts. Once again, the Senate's sales tax reallocation plan was a major topic of discussion. Town of Kill Devil Hills mayor Sheila Davies, Town of Huntersville mayor Jill Swain, and representatives from several local chambers of commerce around the state all appeared and asked House members to oppose the Senate's plan. Mayor Davies and a representative from the Currituck County Chamber of Commerce both made the point that their coastal communities draw in out-of-state visitors who spend sales tax money in N.C. and do not simply encourage residents of other N.C. counties to come and shop in their counties, as proponents of the Senate's plan argue. House Appropriations Senior Chairman Rep. Nelson Dollar said the Appropriations Committee would likely meet again next week.

The meeting came just over two weeks from Aug. 14, which is when the current continuing resolution to fund state government in the absence of a budget expires. Expectations that a budget agreement would be reached prior to Aug. 14 seemed to be fading this week. Lead budget writers on the House and Senate side have not yet met, prompting Sen. Tom Apodaca to say on the Senate floor this week, "I would like to encourage the House appropriations team to join with the rest of us and let's get home before Labor Day." Rep. Chuck McGrady, one of the House Appropriations Committee chairmen, indicated that budget negotiations could not begin in earnest until the two chambers had agreed to a finance package and decided how much money the budget would spend, tweeting, "With tax reform as part of Senate budget, (Finance) chairs must meet so budget targets can be set; that's what is happening." If a budget agreement cannot be reached by Aug. 14, legislators can continue to pass continuing resolutions for as long as they need to before agreeing to a final budget. Contact: Chris Nida

Former City of Durham mayor Nick Tennyson was named Acting Transportation Secretary on Tuesday, following the resignation of Tony Tata. Tata had served as Secretary of the N.C. Department of Transportation since January of 2013, and in a release announcing Tata's resignation Gov. Pat McCrory called him "a valuable partner in our efforts to reform and modernize North Carolina's transportation system." Tennyson had been serving as Chief Deputy Secretary overseeing NCDOT operational and support functions. The League thanks Tata for his service and work with N.C.'s cities and towns, and we look forward to continuing our work with Acting Secretary Tennyson.

Speculation regarding Tata's future and the future of NCDOT began almost immediately following the resignation. In addition to his work as an author, Tata has previously been floated as a potential Congressional candidate, and he did not rule out that possibility in interviews following his departure. Meanwhile, both Tennyson and Rep. Charles Jeter expressed interest in becoming the next NCDOT Secretary to the News & Observer. Jeter, now in his second term representing Mecklenburg County in the House, is also a former commissioner of the Town of Huntersville. Contact: Chris Nida

Numerous newspapers around the state have run columns this week focused on HB 168 Exempt Builders' Inventory, which would exempt homebuilders from paying property taxes on improvements to their property for a period of time or until the property is sold. The League and its members have previously spoken out against the bill, which has been projected to cost local governments upwards of $65 million in property tax revenue annually. One of this week's columns, written by Tim White of the Fayetteville Observer, noted that "From the time the home construction begins until it's sold, our lawmakers want the cities and counties to give builders a free ride. No charge for police and fire protection, free road maintenance and lighting and sanitation." Another, by Patrick Gannon of the Capitol Press Association, stated that the "Senate has been adamant about ridding the tax code of exemptions and other favorable treatments to certain industries ... This would seem to fly in the face of that."

HB 168 has passed the House and received approval from two different Senate committees. It is currently in the Senate Appropriations/Base Budget Committee. If you have thoughts on the bill's impact in your community, please contact your Senators and let them know. Contact: Chris Nida

State Budget Director Lee Roberts met with reporters this week to again make the case for state borrowing to pay for transportation projects, which would support a League advocacy goal of increased investment in transportation. Roberts -- who met with League policy committee members to discuss many of these same issues earlier this month -- said that timing was critical if the State was going to borrow money in the least costly manner available. "The intent of what we're trying to do with the bond is accelerate projects and get as many dollars to work at historically low rates as quickly as possible, which not only saves taxpayers money but it also begins relieving congestion more quickly," Roberts said, according to WECT. Numerous municipal officials from around the state recently joined Gov. Pat McCrory to support state bonds for both transportation and other state infrastructure projects. In a House Appropriations Committee meeting this week, Rep. Nelson Dollar hinted that legislation funding additional capital projects could debut as soon as next week.

Roberts' meeting with reporters came soon after Sen. Bill Rabon and several of his fellow Senators held a press conference promoting the Senate's transportation funding plan. That plan, included in the Senate's version of the budget, increases funding for transportation projects by eliminating transfers from the Highway Trust Fund and funds projects based on the Strategic Transportation Investments (STI) plan passed in 2013. In promoting their own plan, Senators argued against Gov. McCrory's plan to borrow money to pay for transportation projects, saying the borrowing was unnecessary and would fund selected projects that were not the most highly ranked by the STI process. In a release, Sen. Rabon said, "We share the goal of finding ways to shrink the gap between our critical transportation needs and our limited funding. But skipping hundreds of needed projects in favor of old politically-connected plums is a step in the wrong direction." Contact: Chris Nida

Over the past several weeks, numerous groups of mayors and city managers connected with legislators in organized lobbying trips to Raleigh. In addition to League President and Burlington Mayor Ronnie Wall, officials from Erwin, Fuquay-Varina, Goldsboro, and Williamston took advantage of the assistance of the League's grassroots program, LeagueLINC, in setting up meetings with key legislators and receiving briefing materials in advance. These visits were part of a broader effort this session to involve local elected leaders in advocating on behalf of cities and towns. The League thanks these officials for taking time out of their day to press legislators on topics of concern to cities statewide, such as municipal revenue sources. Likewise, the League extends a special thanks to the dozens of legislators and legislative staff who met with these local officials during their visits. If your city or town would like the League to set up a similar half-day agenda, please contact the League's Grassroots Coordinator, Vickie Miller.

The Senate offered an amendment to HB 538 Water and Sewer Service Related Changes earlier this week that would require wastewater systems to accept the collection of liquid condensate from residential heating and cooling systems. Historically, the condensate, or liquid that results from the operation of residential heating and cooling units, is drained outside the house. However, with the instillation of new high efficiency units that produce more condensate, drain lines have been freezing in the winter, resulting in no heat and broken lines. This has resulted in a push for the liquid to be piped into a residential unit’s wastewater collection system.

There are some issues of concern that result from wastewater systems being required to accept this liquid, including (1) the low pH of the condensate; and (2) if a large amount of connections are requested, the increased volume of water to treat could take up needed capacity and be a detriment to treatment efficiency. The League thanks Senator Josh Stein for asking if the League had been consulted and if there were concerns from wastewater treatment providers when this amendment was brought in the Senate. Read more from WRAL. Contact: Sarah Collins

Join the League and Duke Energy on Tuesday, August 11 from 1:30-3 pm, for a webinar to discuss issues surrounding municipal street lighting (registration here). In 2013, the League intervened in the Duke Energy Carolinas rate case before the North Carolina Utilities Commission. This 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. During this webinar, discussion will focus on outdoor lighting strategies for safer, more sustainable communities and information will be shared regarding LED modernization, new products, and outage reporting. Please register by August 4. Contact: Sarah Collins.

Update as of August 7:

This session will be held as an audio conference call instead of a webinar.  The details for dialing into the audio conference are as follows:

  • Toll Free Dial-in Number: 800-533-7619
  • Conference ID:  7876819

In addition, please reference the agenda and presentation during the call.