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League Bulletin

September 18, 2020

​WHAT HAPPENED: A stalemate continued in Congress over local aid. A large municipality fought a judge’s order on short-term rentals. And 2020 Census responses didn’t get any less important.

WHAT IT MEANS: There’s a common denominator of local authority in these stories, which we flesh out in the Bulletin below. Cities and towns are working hard against a variety of factors to continue providing the services their residents and businesses expect. Indeed, we already know from the last recession that municipalities, which play such a large economic role, are vital to the broader recovery.

ON TAP: We just mentioned the 2020 Census – there’s not much time left, even as a federal judge just took additional action to keep headcount efforts alive as the previously scheduled deadline of Sept. 30 looms. Each census response accounts for $1,823 per person per year.  

THE SKINNY: It’s been a turbulent year of unexpected challenges that just seem to compound one another, but we’re so fortunate to have your leadership and diligence as we work toward resolutions – which do carry optimism. Read on for the details. 

​A WRAL op-ed this week urging a vigorous improvement in 2020 Census participation starts off by quoting the League on how high the stakes are – “A census response brings $1,823 per person, per year, in federal and state funds back to N.C. counties and towns…. An incomplete count puts that funding in jeopardy.” The League and its county and state partners have been pushing this message firmly throughout the year, but North Carolina is on track for an unfortunate undercount as the 2020 Census winds down. The op-ed also quotes N.C. Department of Administration Secretary Machelle Sanders calling the census “one of the building blocks of our democracy…. Without adequate participation, we’re risking losing billions of dollars a year in funding for our communities. We are eager to increase our participation and make sure everyone in North Carolina counts.” Local leaders should continue communicating with their communities to urge participation, which is directly in their interest. The census is quick and easy to complete. Check out our page of resources to help in the effort.

​Partisan disagreements on a spending figure for aid remain in Congress as cities and towns continue their push for a direct infusion of funding that won’t get lost or tied up in strict filtering or optional sharing from state or county governments. But as Roll Call reports this week, the Trump administration “is willing to consider another $1.5 trillion in relief for the U.S. economy and health care system … including more aid to state and local governments….” The publication cites former North Carolina congressman and current White House Chief of Staff Mark Meadows for that information. Meadows said that price tag was higher than Republicans were comfortable with but was “not a showstopper at this point.” He said he was optimistic about an agreement, though House Speaker Nancy Pelosi has sought a higher overall number. Direct aid to state and local governments is reportedly one of the biggest pieces of disagreement; a bipartisan caucus called the Problem Solvers targeted a $500 billion infusion, while Republicans and Democrats have targeted figures well below and above that, respectively. Roll Call has more details.

​A judge has granted the City of Wilmington a stay on an order that would have repealed the city’s ordinance on whole-house short-term rentals in residential and historic districts. Earlier this week, the same judge had ruled that the ordinance violated state law blocking cities and towns from requiring rental permits as such, according to local news channel WWAY. But, on Thursday, “The Judge granted the City’s motion for a stay, which is effective immediately and until the appellate process is complete,” the City of Wilmington’s communications office reported in an email. “In the meantime, the City will continue to accept registration applications for homestays and whole house rentals in the same manner that as it has since the ordinance was initially adopted.” The order that the city is appealing referenced a statute -- 160A-424(c) – which speaks to municipal powers and rental property. The StarNews newspaper of Wilmington has more on this story.​

​September marks the first month that municipalities are required to report to the N.C. Pandemic Recovery Office (NC PRO) on their expenditure of Coronavirus Relief Fund (CRF) money. Reports are due on the 20th of every month; because the 20th falls on a Sunday in September, if municipalities have not submitted their required reports to their county already for county submission to NC PRO, they should do so no later than this coming Monday, Sept. 21.

Because this is the first month of reporting for municipalities, municipalities should submit July, August and September reports encompassing any expenditure of CRF funds on eligible expenses incurred since March 1. A municipality’s July report should include expenditures from March 1-June 30. The August and September reports should cover expenditures in July and August, respectively.

In advance of municipalities’ first reporting deadline, the League and the N.C. Association of County Commissioners co-hosted two calls with representatives from NC PRO this week. (View the slides from those calls.) Information on a wide variety of topics regarding both eligible expenses and reporting procedures can be found in the most recent version of CRF FAQs put together by NC PRO. If you have additional questions related to any of these topics, please email League Director of Research & Strategic Initiatives Chris Nida.

​The Town of Norman in Richmond County encountered a budget crisis earlier this year when the county changed its method of distributing sales tax revenue, situationally wiping out the town’s main budget source. Now, the town’s government is considering voluntarily suspending its charter, according to the Richmond County Daily Journal, the area newspaper. Previously, the county distributed money to municipalities on a per capita basis, which provided for Norman’s budgeting. But the county’s board of commissioners earlier this year voted to shift that formula over to an ad valorem basis, which isn’t viable for the small town. The situation in Norman is a bit unique, but municipalities across the state have had standing concerns with how state law allows for sudden changes in sales tax revenue distribution as such. One of the advocacy goals that North Carolina cities and towns set ahead of the past legislative biennium was to seek a change in law to alter the current statues governing distribution of local sales taxes by requiring a one-year delay in implementation when a county or the legislature changes its method of distributing sales tax revenue. Language in that spirit appeared in a House municipal omnibus bill in 2019. While it passed the House unanimously, the bill did not advance in the Senate.