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League Bulletin

September 9, 2016

The National League of Cities (NLC) asks that you contact your member of Congress about problematic "e-fairness" legislation being discussed at the federal level. Specifically, you should ask your member of Congress to reach out to the House Judiciary Committee, led by Chairman Bob Goodlatte (R-Va.), with concern about the draft legislation, called the Online Sales Simplification Act of 2016, which pertains to the taxing of online sales and which could see action on Capitol Hill this month. Click here to review the draft bill.

NLC has pushed for the passage of a law that would close the online sales tax loophole, restore marketplace fairness for competing brick-and-mortar businesses and create new revenue for state and local governments. But the committee's draft lays out a complicated hybrid-origin approach to the sales tax collection, in which the seller’s state would determine what goods are taxed while the buyer’s state would determine the tax rate. The seller would remit collections to a "clearinghouse" that would distribute the revenue to the destination states. The draft would also limit audits of a seller’s remote sales to the origin state and would limit the destination-state’s rate for remote sales to a single statewide rate, NLC explained.

This proposal creates a rigorous tax collection and remittance system that does not ensure local governments would receive locally levied sales taxes. "Try to explain it. It is hard as heck to explain,” Senate Minority Whip Dick Durbin (D-Ill.) was quoted as saying of the bill in Politico. Read more coverage here. In contrast, lawmakers last year introduced a separate, NLC-supported e-fairness bill, HR2775 Remote Transactions Parity Act, in which state and local governments could oblige retailers to collect taxes on remote sales on a buyer-location basis. Click here to find your representative in Congress and communicate your concerns about the Online Sales Simplification Act.

State general fund revenues rose in excess of $700 million in tax and non-tax dollars in the recently ended fiscal year, representing a 3.3 percent increase over the prior year, the Insider State Government News Service reports. Citing the latest monthly numbers from the Office of the State Controller, the outlet reported that tax revenues increased by nearly $861 million, or more than 4 percent, while non-tax revenues fell $158 million, or 15.5 percent. The legislature has lowered income tax rates in recent years. Corporate income tax revenue last fiscal year fell by $270 million, or 20 percent, though individual income tax receipts increased by $827 million, or 15.5 percent. State Budget Director Andrew Heath connected the latter to job growth. Sales tax receipts increased by $308 million, or roughly 5 percent. According to the Insider, the end-of-year cash surplus after revenues and expenses came out to around $940 million. Click here for the full report from the state.

The scheduled trial over House Bill 2's restroom restrictions is moving down the calendar, according to the Associated Press. State Republican leaders won a request to delay the case's day in court while the U.S. Supreme Court weighs whether it will hear a transgender restroom access case in Virginia, the AP reported. Originally, the North Carolina trial was set for November. Now, it's expected in May 2017. The news agency also noted that U.S. District Judge Thomas Schroeder recently granted in part a preliminary injunction for a group of transgender plaintiffs suing over the North Carolina law. Among other things, HB2 sets out restrictions on restroom access in public buildings and schools in a way that the LGBT community and its supporters see as discriminatory -- requiring individuals to use only the restrooms that match their biological sex as defined on their birth certificate, as opposed to gender identity. Judge Schroeder determined the plaintiffs had a good chance of success with their case that HB2 violates Title IX, the federal prohibition on gender discrimination in schools. It's one of at least five lawsuits circling HB2. The legislature passed the law, which also prohibits municipalities from enacting local nondiscrimination ordinances, during a one-day special session early this year. Read more news coverage here.

Rep. Holly Grange

Gov. Pat McCrory has appointed a successor for Rick Catlin, the two-term Republican state House member from Wilmington who resigned his seat last month. Holly Grange, the party's nominee for House District 20 (to which Catlin did not seek re-election), won local party leaders' approval to fill the vacancy and received the governor's appointment last week as she heads to an uncontested ballot. According to her legislative and campaign bios, Grange is director of community relations at Osprey Global Solutions ("a Wilmington company specializing in global, full-spectrum life-support medical, logistics and construction, as well as security, training and business intelligence services," of which her husband, David Grange, is CEO) and worked previously with the U.S. Army Corps of Engineers, from 1982-1997. She is also a 15-year U.S. Army veteran, a National Rifle Association pistol and rifle instructor, and a concealed-carry instructor. The legislature, which last adjourned on July 1, is not scheduled to reconvene until January 2017. Catlin resigned in August to spend more time on local matters including his engineering business.

The Associated Press is reporting that last Saturday's brush with Tropical Storm Hermine caused at least $2.5 million in damage to nearly 660 buildings in Dare County alone. That's an early estimate that includes seven majorly damaged homes in Colington and Duck, one home in Southern Shores destroyed by trees and one in Kitty Hawk rendered uninhabitable. Most of the county's financial toll fell on Hatteras Island, according to the AP, which adds that the estimate doesn't include debris removal costs or personal property damage, like to vehicles. Updated figures are expected soon.

Wait no longer! Register now for the CityVision 2016 Annual Conference in Raleigh, Oct. 23-25. As you know by now, the League is doing things a bit differently this year -- the Advocacy Goals Conference will be on Sunday the 23rd with cities and towns determining legislative and regulatory priorities for the 2017-2018 NCGA biennium. Attending the Advocacy Goals Conference is the best way to help us better position cities' and towns' advocacy efforts in 2017 and beyond. Make sure your voice is heard and your vote is cast at the Advocacy Goals Conference!

Moving into the CityVision 2016 Annual Conference, you will learn ways to connect success stories to your citizens, community and beyond, adapt to demographic and cultural changes, and grow a strong economic foundation in your hometown. Make one trip, and check off two important conferences on your calendar! Click here to register for both the Advocacy Goals Conference and the CityVision 2016 Annual Conference.

Registration is open for the next joint meeting between League members and Duke Energy to discuss issues surrounding the modernization of municipal street lighting. The meeting will take place on Sept. 26, 10 a.m. to 2 p.m., at Duke Energy in the O.J. Miller Auditorium (526 S. Church St., Charlotte). This meeting will serve as a continuation of discussions that began after the League, in 2013, intervened in the Duke Energy Carolinas rate case before the N.C. Utilities Commission. It's an opportunity for Duke to check in with municipal customers to discuss outdoor lighting strategies, updates and sustainability efforts. The discussion will include updates on LED modernization, new products, industry news, and more. Contact: Sarah Collins

Last week's episode of Municipal Equation -- an extended edition -- featured big perspective and sharp insights on modern law enforcement issues from leaders in the field as well as state lawmakers who attended a recent League forum, held at the request of the N.C. Legislative Black Caucus, on the topic of trust between police and the public. Didn't get a chance to listen? Click here. You'll hear Sen. Floyd McKissick of Durham and Rep. Garland Pierce of Wagram discuss police training, trust with civilians and relationship-building, while Rep. John Faircloth of High Point recalls being a police officer in the 1960s and how technology has evolved since. All that and more on this special, extended edition of Municipal Equation, the League's biweekly podcast on all the challenges, solutions, successes and new concepts surrounding today's municipalities.

Want a preview of next week's episode? Click here. We'll talk with William Eggers, executive director for Deloitte's Center for Government Insights, about what he sees as the new baseline for adoption of technology in government and what the modern citizen -- becoming more accustomed to apps and web portals that deliver services upon demand -- might expect in that regard. A lack of tech integration can affect talent recruitment at city hall, too, he says. Click here for all past episodes and here to subscribe for free on iTunes. The podcast is also available on mobile streaming services like Stitcher, Google Play, Overcast, TuneIn and more. Thanks for listening, and please take a moment to give the podcast a good review on iTunes.

Manufacuring Day 2016 -- a "celebration of modern manufacturing meant to inspire the next generation of manufacturers" -- is set for Oct. 7, and organizers are encouraging local groups to plan events around it. "Whether through a plant tour for community partners or an open meeting with your organization’s leadership and elected officials, Manufacturing Day is a great way for you to increase public awareness of the manufacturing industry," the pitch says. "Please help recruit companies in your community to participate!" Visit to learn more.