PENC Legislative Update

State Budget

The North Carolina House and Senate continue to hammer out differences in the state budget with only a few days left before the continuing budget resolution expires.  Sources say there remains disagreement between the two chambers regarding Medicaid relief for counties and whether or not to include the local option transfer tax in the budget – the transfer tax (or “Home Tax” as its being called) being the most contentious with interest groups on both sides spending hundreds of thousands of dollars to sway the vote in their favor.

The Senate and House leadership met twice on Tuesday behind closed doors in what is hoped to be a signal that the budget deliberations are winding down.  The Governor has urged state lawmakers to pass the $20 billion budget quickly and to include the local option transfer tax so that communities experiencing high growth can have an additional revenue source by which to pay for infrastructure needs.  The transfer tax “option”, if included in the state budget, would require that there be a local referendum before counties could impose the tax.

Due to the controversy over the transfer tax, it remains to be seen as to whether or not any significant infrastructure funding will be included in the budget.  However, Senator Clark Jenkins has drafted a proposal that would raise an additional $300 million for transportation which appears to have support from leadership in the House and the Senate.  The $300 million would be phased in over a 2-3 year period by increasing the Highway Use Tax and the vehicle registration fee.  This new revenue could be used to finance bonds, thereby allowing the Department of Transportation to speed up project delivery and address critical maintenance needs.

Legislation

Significant legislation of interest such as the Solid Waste Management Act and Amending the Interbasin Transfer law, is still pending but expected to pass at least the Senate chamber before the session adjourns.  Both SB1421 and SB 1492 were given favorable reports in the Senate Committee on Agriculture, Environment and Natural Resources this week and the Solid Waste Management Act as amended was given a favorable report in Senate Finance on Wednesday.  Both bills could be voted on by the full Senate by the end of the week.    

The most significant proposed changes to the Interbasin Transfer law are the provisions for dealing with regulation of surface water transfers including a notice of intent to file a petition.  There are also several new conditions and limitations before financial determination can be made on approval of a certificate. Opponents of the bill argue that it will make the request for an interbasin transfer hard to achieve while supporters want to ensure fairness to all parties affected.  SB 1421 was successfully amended yesterday by Senator Hartsell to exclude the Cabarrus/Kannapolis interbasin transfer from the new law – if passed.

After a lengthy stakeholders process, the Solid Waste Management Act of 2007, despite strong opposition, was approved in the Senate Agriculture committee with very few changes and, on Wednesday, was given a favorable report by Senate Finance with a few amendments.  Opponents are upset by the new Tipping Fees that would be imposed and the stringent buffer zone requirements.  Supporters contend that NC will be the 4^th largest importer of solid waste in the nation if this bill does not pass.  This bill could be placed on the Senate calendar as early as Thursday.

The status of other bills of interest include:

SB 490 - Industrial Machinery Code – An act to clarify that industrial machinery is not subject to regulation under the Building Code.

Status:  Passed in the Senate, referred to the House where a committee substitute was given a favorable report in both committees and placed on the House Calendar for 7/25/07

HB 810 – Clarify/Extend Animal Waste Management Provisions – An Act to (1) clarify the training and qualification requirements applicable to animal waste management technical specialists in the provision of services related to the development, implementation, or operation of an animal waste management plan or animal waste management system, as recommended by the Environmental Review Commission; (2) extend the pilot program for inspection of animal waste management systems; and (3) clarify the applicability of the water quality enforcement provisions in Article 21 of Chapter 143 of the General Statutes

Status:  Passed in House, referred to the Senate where it was given a favorable report in Senate Agriculture committee and placed on the Senate Calendar for 7/25/07

SB 3 – Promote Renewable Energy/Baseload Generation – An Act to:  (1) Promote the development of renewable energy and energy efficiency in the state through implementation of a renewable energy and energy efficiency portfolio standard, (2) Allow recovery of certain nonfuel utility costs through the fuel charge adjustment procedure, (3) Provide for the ongoing review of construction costs and the recovery of costs in rates in the General Rate Case, (4) Adjust the public utility and electric membership corporation regulatory fees (5) Provide for the phaseout of the Tax on the sale of Energy to North Carolina farmers and manufacturers, (6) Provide an income tax credit for builders of energy-efficient homes, and (7) Allow a tax credit for contributors to 501 C3 organizations for renewable energy property.

Status:  Committee Substitute passed in the Senate, and referred to the House where it was given a favorable report in the House Committee on Energy and Energy Efficiency. Referred to House Committee on Public Utilities on 7/24/07.  If favorable, the bill will go to House Finance before being voted on by the full House.

HB 73 - Improve State Construction Process – An Act to improve the State Capital Facilities Program by directing the State Building Commission to review the program and implement measures to reduce delays and increase accountability among the parties to the design and construction process, by increasing the bidding and designer selection thresholds for state construction contracts, and by directing the State Personnel Office to conduct a market study of architect and engineering position classifications.

Status:  Committee substitute passed in the House, Senate committee substitute given favorable report by the Senate Committee on Commerce, Small Business and Entrepreneurship.  Passed in the Senate and placed on House calendar for concurrence on 7/25/07.

SB 1490 - Certificate of Merit – An act requiring a certificate of merit on civil actions filed against a person or firm providing architecture or engineering services in this state.

Status:  Awaiting a hearing in the Senate Judiciary committee. 

SB 1245 - Retainage Payments/Construction Contracts – An Act amending the laws related to retainage payments on public construction contracts.

Status:  Committee substitute passed in the Senate and referred to House Committee on Commerce.  Committee substitute reported favorably by House Commerce and re-referred to House Judiciary II Committee.

HB 610 - Design Build Construction – Transportation – An act to set the number of Design-Build construction contracts that may be awarded by the Department of Transportation at twenty-five contracts each fiscal year. 

Status:  Presented to the Governor on 7/23/07

HB 292 – Accelerated Yadkin River Bridge Replacement – An act to authorize the North Carolina Turnpike Authority to study and undertake preliminary design work for a replacement for the Yadkin River Bridge.

Status:  Presented to the Governor on 7/20/07

SB 668 - Energy Conservation in State Buildings – An Act to promote the conservation of energy and water use in state, university, and community college buildings.

Status:  Passed in the Senate and sent to the House. 

HB127/SB 208 – Clean Water Act of 2007 – An Act to authorize the issue of General Obligation bonds of the state, subject to a vote of the qualified voters of the state to address statewide critical infrastructure needs by providing funds for grants and loans for wastewater and drinking water projects.

Status:  Both bills are awaiting a hearing in their respective Chamber’s Finance Committee

Please call or e-mail if you have questions about any of the items mentioned in this update or other items of interest that have not been included here. 

It is still not too late to contact your legislators to request support for infrastructure funding.  To contact your legislator go to www.ncga.state.nc.us for a list of all NC Senators and Representatives and their contact information.  It’s important for you, as their constituent, to let them know that a strong infrastructure is critical to the public’s welfare and the state’s economy.