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Take Action to Build NC's Future
SB 1378 “Build NC’s Future Act”, sponsored by Senator Tony Foriest and Co-Sponsored by Democratic and Republic leaders in the Senate would “Create jobs and make North Carolina more competitive globally by financing the building of engineering education facilities, the enhancement and repair of state assets and community college assets, and investment in research and job training equipment at universities and community colleges."
The bill passed the Senate and is now headed to the House for consideration and debate. While House leaders are supportive of the effort, they are concerned about the impact the additional debt would have on the budget and on the state’s triple A bond rating.
Here’s what the bill does:
Issues Certificates of Participation Over the Next Two Years for the Following Projects:
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Engineering Building IV at NC State University - $161 million
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Engineering Building at NC A&T State University - $104 million
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Repairs and renovations at universities and state facilities - $130 million (54% to universities and 46% to state agencies)
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Equipment at community colleges and Universities - $55 million (60% to community colleges and 40% to universities)
This Proposal Is Within Our Existing Debt Capacity
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Debt Affordability Study says net tax-supported debt service as a percentage of general tax revenues should be targeted at no more than 4% and should not exceed 4.75%
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This proposal takes our debt capacity to 4.25% and was developed in consultation with the Treasurer’s Office.
This Proposal Puts People Back to Work and Positions Our State for the Future
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Job-training equipment in key areas like science and healthcare
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NC State economist Mike Walden estimates the construction and repair work funded in this bill would create 6,850 jobs in NC
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Allows the state to give contract preference to NC businesses on these projects
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Focuses on engineering to give our state a competitive edge in a global economy
Why Make These Investments Now?
Savings in the Construction Market and the Opportunity to Create Economic Activity
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Construction projects are coming in significantly under projections (sometimes as high as 30%). NC should act now to gain those savings instead of waiting until construction costs rise again.
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This work creates job opportunities for electricians, plumbers and other construction related workers through repairs and renovations as well as new projects.
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Higher education projects, at both the university and community college levels, are focused on key areas of study – engineering, science and technology, healthcare – in the industries that NC should encourage to grow.
Community Colleges Need new Equipment in Growing and High-Demand Fields
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Job-training equipment is sorely needed in our community colleges in strategic, high-growth areas like health and technology education.
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Community college equipment needs are not part of the continuation budget and – with the growth of 31,000 students this year – they need additional funds to buy equipment and improve job training in key programs.
NC Can Easily Afford to Make This Critical Economic Investment
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NC is one of just 7 state with Triple A ratings from all three bond raters, and we compare very favorably with our AAA peers and on a national basis.
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This package is still under our 4.75% debt ceiling.
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If we wait until construction costs and interest rates start to rise again, these facilities will just be more expensive to build.
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We do not need to wait one more minute to put people back to work.
If you have a legislator on the list below of House Appropriations Chairs and Co-Chairs or House Finance Chairs, Co-Chairs and members, please call or e-mail them and let them know how important it is to invest in NC’s future by passing SB 1378.
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Rep. K. Alexander,
Rep. Blackwood,
Rep. Blust,
Rep. Braxton,
Rep. Carney,
Rep. Cotham,
Rep. Faison,
Rep. Folwell,
Rep. Hall,
Rep. Hughes,
Rep. Jones,
Rep. Lewis,
Rep. McCormick,
Rep. McGee,
Rep. Owens,
Rep. Rhyne,
Rep. Ross,
Rep. Setzer,
Rep. Stam,
Rep. Starnes,
Rep. Tillis |
Take Action in Support of NC Mobility Fund for Transportation
The NC Mobility Fund for Transportation was originally included in the Governor’s budget to fund projects of statewide significance – the first being Phase II of the Yadkin River Bridge Project (widening of I-85 on the north side of the bridge). Phase I, the bridge replacement, will be funded with GARVEE funds.
The revenue from the fund, included in the Governor’s budget, was proposed to come from an increase in various DMV fees and a reduction of the transfer from the Highway Trust Fund to the General Fund. By year three, when the transfer would be completely phased out, the fund would grow to over $300 million. A stakeholder process would be established to prioritize future projects eligible for the fund.
The Senate budget did not include the NC Mobility Fund.
The House budget includes funding for the NC Mobility Fund but does not raise revenue from fees and does not provide additional funding beyond the Yadkin River Bridge Project. The House Mobility Fund proposal is as follows:
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$39 million unencumbered NC Turnpike funds projected to be unspent in FY 2009-10 for use in FY 2010-11
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$31 million reduction of Highway Trust Fund transfer to the General Fund in FY2011-12
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$45 million reduction of Highway Trust Fund transfer to the General Fund in FY2012-13
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$45 million reduction of Highway Trust Fund transfer to the General Fund in FY2013-14 (and for future years)
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This leaves $25.5 million to be transferred from the HTF to the GF for future years and $18 million transferred from the Highway Fund to the General Fund for future years.
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The YRB project will consume all the money until mid FY2013-14. The bill has a stakeholder process to develop the project prioritization process for future Fund projects.
Urge legislators – especially budget conferees - to support the NC Mobility Fund. At the very least, funding included in the House proposal is critical to begin the second phase of the Yadkin River Bridge project. yle48"> While the House proposal is the minimum required, stakeholders, NCDOT and the Governor’s office would prefer something closer to the Governor’s proposal which included increased funding for Interstate maintenance ($30 million) and Municipal Powell Bill ($20 million).
ASK FOR TOTAL ELIMINATION OF TRANSFER of TRANSPORTATION FUNDS TO GENERAL FUND IN FUTURE YEARS
NC House Gives Final Passage to Budget Proposal
Last Friday, a little after midnight, the NC House gave its final approval with a vote of 63-49, mostly along party lines, to their budget proposal. This $18.9 billion proposal is similar to the Senate proposal passed earlier in that it aims to create jobs through targeted tax relief for small businesses and makes cuts across the board – but most significantly in education and health and human services. The University of North Carolina system would have to find another $139 million in spending cuts at its campuses and central office compared with the Senate plan. Public schools would benefit from $90 million more in North Carolina Education Lottery profits than the Senate used to preserve what House Democrats say are 1,600 positions in the classroom statewide. The House budget still counts on receiving almost half a billion dollars from the federal government as the result of a more generous Medicaid formula. However, budget writers warn that if the federal Medicaid money doesn’t materialize, there will be more drastic cuts.
Budget items of interest to engineers include:
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Both the House and Senate budgets appropriate over $12.0 million in match funds for Clean Water/Drinking Water State Revolving Funds
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House and Senate proposals also include $50 million for the Clean Water Management Trust Fund
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$9.1 million is included in both capital budgets as a match for Water Resources Development Projects
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The House includes funding for the NC Mobility Fund for transportation. The Senate budget does not include the Mobility Fund.
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The Senate budget includes a line item for another $18 million in debt service payments to incur $451 in special indebtedness to fund SB 1378 – Build NC’s Future Act (see description above)
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The Senate budget also includes $18 million in capital for various higher education projects
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The House budget includes language establishing a Repair and Renovation reserve in the amount of $70 million. The UNC System would receive 50% and remaining state agencies would receive the other half.
House and Senate budget conferees will be announced within the next few days to work out their differences in time to send a compromise budget to the governor by July 1. Cuts to public education and the university system, debt, and proposed taxes and fees will likely to be the major issues of contention during the negotiations. Once the final budget is signed by the governor, it is likely that leaders in both the House and Senate will move to adjourn within a matter of days so that legislators can prepare for their upcoming elections in November.