1. Legislative Update
N.C. Local Government Budget Association
Asheville, NC
December 13, 2013
Chris Nida, Policy & Communications Specialist
N.C. League of Municipalities

2. Agenda
• 2013 Session Overview
• Look Ahead to 2014 Session
– Interim studies
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Federal Issues
NCLM Policy Development
Stay Involved
NCLM Budget & Tax Rate Survey
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3. 3

4. 2013 Long Session
Overview

5. Session Overview
• Building relationships was a major key to
success
– Town Hall Day, Advocacy Goals Conference,
District Days!, All Hands on Deck
• Tax reform and budget among the critical
achievements this session
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6. Tax Reform
Municipal Revenue Change ($ millions)
HB 998 Version
FY 13-14 FY 14-15 FY 15-16 FY 16-17 FY 17-18 FY 18-19
House
2.2
32.0
34.2
36.5
38.7
40.9
Senate 2nd Reading
3.3
-69.0
-130.0
-112.3
-99.8
-163.9
Senate 3rd Reading
3.6
25.0
13.7
-25.5
-9.5
-10.1
Final Agreement
5.3
13.5
14.3
15.0
15.7
16.4
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7. Session Overview
• Local control issues took center stage
– Annexations and deannexations
– Transfer of assets
– Regionalization of utilities
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8. Session Overview
• Transportation reform
– Divides statewide transportation revenues
between three “tiers” of projects: State (40
percent), Regional (30 percent), Division (30
percent)
– Projects selected through combination of datadriven criteria and local input
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9. Looking Ahead: 2014
Short Session

10. Looking Ahead
• Unknown future for House leadership
• Senate leadership likely to remain intact
• Several important issues on the horizon:
– Public records
– Transportation funding
– Hydraulic fracturing
• Session convenes: Wednesday, May 14, 2014
• Town Hall Day: Wednesday, June 4, 2014
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11. MEC Rulemaking
• Mining & Energy Commission
– MEC is currently making rules related to hydraulic
fracturing; topics of interest to local governments
include:
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Baseline testing of groundwater and surface water supplies
Water management
Waste management
Setbacks
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12. Interim Studies

13. Privilege License Study
• HB 998 – Tax Simplification and Reduction Act
– HB 998 authorizes several tax reform-related studies,
including:
• The authority of cities and counties to impose a privilege tax
on businesses and the various State privilege license taxes.
– Both reform and elimination of the privilege license
tax were proposed during the session
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14. Environmental Review
Commission (ERC) Studies
• HB 74 – Regulatory Reform Act of 2013
– Four studies authorized by HB 74:
• The statutory models for establishing, operating, and financing
certain organizations that provide water and sewer services in the
state
• The technical review of plans by non-professional engineers
• The state stormwater programs, with a specific focus on how
partially impervious surfaces are treated in the calculation of builtupon area under those programs
• The circumstances under which cities and counties should be
authorized to enact environment ordinances
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15. Legislative Research Commission
(LRC) Studies
• The General Assembly will also be studying the following
issues, which have relevance to local governments:
– A review of all issues related to water quality in Jordan Lake
– The establishment of a property owner protection act, including
awarding attorney’s fees to property owners in the event of litigation
against a local government
– Allowable uses of local government public enterprise system funds
– Responsibility for maintenance of infrastructure on foreclosed or
abandoned properties
– Policies and roles related to wetland and stream mitigation
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16. Interim Committees

17. Revenue Laws Study Committee
• Outstanding issues related to tax reform
– Expansion of sales tax to admissions
– Utility franchise tax changes
– Expiration of tax credits
• Dept. of Revenue staffing
• Tax & Tag Together
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18. Joint Legislative Committee on
Local Government
• Heard presentations Monday related to local debt
– Representatives from LGC, NCACC, bond attorneys, and
lenders addressed committee
– Raleigh CFO Perry James presented city perspective
– Relatively few questions from committee members
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19. Federal Issues

20. Federal Issues
• Biggert-Waters Act
– Passed in 2012 and designed to ensure solvency of the
National Flood Insurance Program
– Many property owners, especially in coastal
areas, have seen significant flood insurance rates due
to implementation
– Homeowner Flood Insurance Affordability Act
proposal supported by NCLM and NLC
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21. Federal Issues
• Water Resources Reform and Development Act
– US House version of the bill does not allow for
extension of federal cost-sharing partnerships for
beach renourishment
– Carolina Beach first in the nation to expire, beginning
in 2014
– House and Senate currently in conference committee
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22. Federal Issues
• Marketplace Fairness Act
– Passed by US Senate to allow local governments to
collect internet sales taxes
– Has not received hearing in House
– US Supreme Court elected not to hear a case on the
issue
– Supported by NCLM and NLC
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23. NCLM Policy
Development

24. NCLM Policy Development
• Legislative goals set by membership in even-numbered
years
• Membership may submit goals June – August
• LACs/RAC votes on goals to forward to the Board of
Directors
• Member review November – January
• Advocacy Goals Conference January 2015
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25. Stay Involved

26. Stay Involved
• Consider joining a policy committee:
– Tax & Finance
– Planning & Environment
– General Government
• Get involved at the national level through NLC
• Town Hall Day – June 4
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27. Stay Involved
•
Connect with the League’s legislative communications
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LeagueLINC Grassroots Online
LINC Bulletin – Weekly during session
LINC’ed IN
Action Alerts
News & Notes
ECOLinc Newsletter
Let us know how we can help
– Arranging visits, setting up meetings, etc.
– LeagueLINC@nclm.org
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28. Bill tracking
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•
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Provides NCLM staff summaries of
key legislation, with links to NCLM
bulletins and memos for more
information
Look up bills by number or topic
View the priority of the issue for the
League
See up-to-date information on each
bill, pulled from the N.C. General
Assembly website
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29. LeagueLINC Bulletin
Sign up for the League’s LeagueLINC
Bulletin, published weekly during the
legislative session, by emailing
LeagueLINC@nclm.org
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30. NCLM Budget & Tax
Rate Survey

31. Preliminary Results
Revenues Better Able to Support
Spending and Increased Tax Rates
100%
80%
60%
40%
20%
0%
FY 07-08
FY 08-09
FY 09-10
FY 10-11
FY 11-12
FY 12-13
FY 13-14
Projected revenues better able to support your spending requirements than
previous year
Tax Rate Increase
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32. Preliminary Results
Budget-Balancing Strategies FY 2013-14 and FY
2012-13, All Municipalities
Reduced Employee Benefit Levels
Brought back in-house services previously…
Imposed/raised impact or development fees
Reduced service levels
Shifted/shared responsibilities with another …
Contracted out additional services
Imposed a hiring feeze for part or all of…
Raised Tax Rate
Reduced the number of municipal employee …
Appropriated more fund balance than in …
No pay raises for employees
Reduced actual capital spending below…
Reduced proposed spending/programs
Cut spending specific programs/departments …
Increased existing fees and charges for services
Implemented new fees and charges for services
0%
FY 13-14
FY 12-13
10%
20%
30%
40%
50%
60%
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33. Questions and Comments?
Chris Nida, Policy & Communications Specialist
Office: (919) 715-3945
Mobile: (919) 609-8671
cnida@nclm.org
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