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League Bulletin

October 6, 2017

Municipal officials in Emerald Isle and across the state are lauding a U.S. Supreme Court action this week that should have the effect of affirming the public's access to ocean beach strands. Justices on Tuesday denied a request to continue what has been a longlived legal battle and, in doing so, kept intact a 2015 N.C. Court of Appeals ruling that upheld a Town of Emerald Isle ordinance allowing town vehicles to drive on the dry-sand portion of the beach and prohibiting private landowners from placing permanent objects that might impede public access on that section of beach. The case spanned roughly six years. Past LINC'ed IN coverage provides background. The action also received media attention.

"This is a tremendous victory for Emerald Isle, all N.C. beach communities, and the entire state of North Carolina," said League Executive Director Paul Meyer. As an insurer for the town, the League had been involved with the case from the outset. "The Emerald Isle Town Board, staff, and legal team are to be commended and thanked for their courage and doggedness on this matter, and the League was very pleased to be part of the effort," Meyer said.

A news release from the Town of Emerald Isle provided additional context and appreciation for the case's outcome. "The Town is pleased with the U.S. Supreme Court's decision, and is even more pleased that the public's historical use of the beach since time immemorial remains intact and that current and future generations will continue to enjoy this special place in Emerald Isle and every other NC beach community," the town said. The League again thanks the Town and its partners for its work on this important public issue.

The League and scores of other North Carolina entities from the public and private sectors have signed on to a letter addressed to U.S. House and Senate officials on the importance of preserving and enhancing the Federal Historic Tax Credit. The conversation has gained volume amid congressional movement on tax reform with the possibility for elimination of various tax deductions and credits.

The letter explains that the Historic Tax Credit went into effect 35 years ago and is widely used for the revelopment of underutilized properties and the subsequent preservation or revitalization of their surroundings. "The credit is the most significant investment that the federal government makes to preserve our nation's historic properties," the long list of co-signers from across the country said. Data from the National Park Service show that 653 Federal Historic Tax Credit projects in North Carolina between 2002 and 2016 resulted in more than $1 billion in development.

The letter specifically was addressed to U.S. Sens. Orrin Hatch and Ron Wyden, who lead the Senate Finance Committee, and Reps. Kevin Brady and Richard Neal, who lead the House Ways and Means Committee. Those committees consider federal tax code changes.

Backers of the historic tax credit ask that you urge your federal legislators' support and request that they communicate that support to members of these committees. Further, you should request meetings with your federal legislators during the October recess to discuss the preservation and enhancement of the credit. The Historic Tax Credit Coalition and the National Trust for Historic Preservation have also produced a related fact sheet.

Amid proposals that may change or even eliminate the federal government’s state and local tax deduction, commonly referred to as SALT, officials should take action now and urge Congress to keep the program fully intact. SALT, as reported in last week's LINC'ed IN, is a critical tool that ultimately helps garner public support for cities and towns across the country to invest in infrastructure and residents' safety. Proposals to limit or modify it should be rejected, say groups including Americans Against Double Taxation (AADT), which has produced an action alert and fact sheet highlighting Congressional districts with a high percentage of residents who take the deduction. Two are in North Carolina.

"The elimination of SALT is one of the largest sources of revenue in the 'Big Six' tax plan, estimated at $1.3 trillion dollars taken from 44 million households," AADT says. "Thus, any compromise and anything less than preserving the full deduction, is sure to cause millions of taxpayers to pay higher taxes, undermine funding for state and local government and the services they support, and possibly cause home values to decline as well." Contact your members of Congress now and urge their support for an unchanged SALT deduction.

The League has intervened in Duke Energy Progress and Duke Energy Carolina’s recent filings for rate increases. The N.C. Utilities Commission (NCUC) accepted the League's petitions on Wednesday. The League has contracted with specialized outside counsel to represent cities and towns in negotiations with Duke Energy and NCUC. The goal of the League’s intervention is to reduce the financial burden that an increase in investor-owned utilities' electricity rates would bring upon municipal governments served by the utilities. Increases in electricity rates can significantly impact municipal budgets, particularly in those cities and towns providing such services as water and wastewater treatment, street lighting, traffic signals and recreational facilities.

Additionally, the League will hold a joint meeting with members and Duke Energy to discuss issues surrounding the modernization of municipal street lighting. That meeting is scheduled for Oct. 19, 10:30 a.m.-2 p.m., at Duke Energy's Raleigh offices on 410 S. Wilmington St. This meeting is a continuation of discussions with Duke Energy that began after the League, in 2013, intervened in Duke Energy Carolina’s previous rate case. Registration information and an agenda and will be available soon. The meeting is an opportunity for Duke to check in with municipal customers to discuss outdoor lighting strategies and other initiatives. Contact: Sarah Collins

After another round of business this week that included judicial redistricting measures, another veto override and the passage of a local legal notices bill, the General Assembly left Raleigh with a plan to return in January. Until then, members will gavel in and out of skeletal sessions. The session to begin on Jan. 10 could include redistricting, veto overrides, nominations or appointments, responses to litigation, election law matters, conference reports and other topics similar to those outlined in other, recent adjournment resolutions.

Lawmakers on party line votes overrode the governor's veto of SB 16 Business Regulatory Reform Act of 2017, a broad piece of legislation with environmental components. The Senate also completed the veto override that the House began in September of HB 56 Amend Environmental Laws, which included a few items of interest of local governments, such as a riparian buffer tax exclusion, clarification of setback determination for permitted disposal systems, and measures regarding the widely reported presence of a chemical called GenX in the Cape Fear River. In other actions this week, a Senate bill has become law to allow Guilford County governments to place legal notices online in lieu of newspaper placement.

The state’s chief transportation official touted the numerous ways his agency has sped up current road, bridge, and other transportation projects in a presentation to legislators on Monday. Addressing members of an interim House panel examining transportation funding, N.C. Department of Transportation (DOT) Secretary Jim Trogdon said the department had increased its available cash by more than $800 million in each of the next two years. He said the funds were saved through DOT’s revision of project schedules and streamlined project management.

Trogdon also explained the numerous changes DOT had recently made to better serve local officials. With changes authorized in this year’s state budget, he said DOT had already undertaken numerous projects around the state that cost less than $2 million -- projects that would not have been completed otherwise. He also described a significant change in DOT’s internal services to local governments, whereby division-level staffers are now dedicated to providing technical support in the way of planning services to rural planning organizations (RPOs) and municipal planning organizations (MPOs). Trogdon said this support would save RPOs and MPOs money because they would not have to hire private firms to complete mapping, modeling and other advance planning activities and analyses that these DOT engineers would now do upon request.

Finally, Trogdon noted that DOT changed the process that local officials used in prioritizing future projects within their local transportation divisions, resulting in more flexibility. Rather than using a one-size-fits-all approach, he explained that RPO and MPO leaders in each division could now vary the scoring criteria so that it made the most sense for their region. This flexibility should allow local officials to target funds toward top priorities that better-fit the needs of their division.

At the same time, Trogdon warned legislators of a precipitous drop in future state transportation dollars. These funds make up the bulk of all transportation-related funding in the state. Trogdon tagged technological advances as the primary culprit for declining revenues. For example, he said that most vehicles produced eight years from now would be electric, robbing the state of much of its gas tax revenues. Gas tax receipts now pay for half of all transportation projects in North Carolina. Fees charged of vehicle buyers and drivers form the other half of the revenue mix, and Trogdon pointed to the anticipated widespread use of car shares and autonomous vehicles in the next decade as the other main reason these revenues would severely decline. He urged committee members to consider other revenue sources now, such as a $3 billion transportation bond. Contact: Erin Wynia

Municipalities are beginning to receive their share of $147.6 million in Powell Bill funds. According to the N.C. Department of Transportation (DOT), half of the overall total marked for the street aid program went out to 508 cities and towns last week. The rest will be paid by the end of the calendar year. Municipalities have to the apply for the funds. "The Powell Bill funding helps local government improve transportation systems within their communities," State Transportation Secretary Jim Trogdon said in a news release with additional detail about the allocation. "These funds support projects selected by local government such as resurfacing and repairing roads, and enhancing existing infrastructure." DOT's website has a full list of recipients and amounts.

There is still time to apply to serve on one of the League's policy committees, which is a great way to get involved in the advocacy efforts that benefit all cities and towns. The deadline to fill out an interest form is Nov. 18. You can return the form to Public & Government Affairs Coordinator Karen Waddell. The Legislative Action Committees and Regulatory Action Committee serve a crucial role in developing League priorities and in making the needs of cities and towns known to state and federal policymakers. Get involved today!

Oak Island Mayor Cin Brochure will serve on the board of the Coastal Property Insurance Pool following an appointment from Insurance Commissioner Mike Causey. "Ms. Brochure has a background in small business, tourism, and economic development in the beach and coastal areas of North Carolina that is well-suited to her Board appointment," says an information release from the N.C. Insurance Underwriting Association. The pool was created as a "market of last resort" for insuring coastal property and serves as an important component of growth in the region. Mayor Brochure said she was honored by the appointment. "I know the importance of a well-prepared and financially sound insurer for all the coastal areas of North Carolina subject to hurricane force winds," she said. "I am excited to begin my work with the other Board members of the Association and to continue the Association’s support of the citizens of North Carolina.”