March 25, 2011
In This Issue:
This week and last week at the NC General Assembly, legislation was introduced that would have a direct negative impact on our state’s transportation system. HB 399 introduced by Reps. McElraft, Killian (House Transportation Appropriations Co-Chair), Hager, Stone, Ingle, Jordan, LaRoque, and H. Warren would cap the gas tax at the current rate of 32.5 cents per gallon. The gas tax is the major funding source for NC's transportation system with a state maintained road network second only to Texas in lane miles.
Capping the gas tax would only save the average driver about 20 cents per week while costing the state $250 million over the next two years. That lost funding would result in almost 7,000 lost jobs, mostly in the transportation design and construction industry.
Because the gas tax is a variable rate that is allowed to fluctuate with the price of gas, the rate is adjusted twice a year – once in January and again in July. With the increased price of fuel, budget assumptions and planning within the DOT work plan had projected the tax to increase to 34.2 cents in July and the transportation 10 Year Work Plan is based on this forecast. Therefore, capping the tax at the current lower rate as proposed in HB 399 would considerably slow down transportation projects and even bring some projects to a halt. With engineering jobs on the line and transportation infrastructure in desperate need of maintenance, we need to stand strong in our opposition to capping the gas tax at anything lower than 34.2 cents.
A second bill, HB 422, whose primary sponsor is Representative Killian, House Transportation Appropriations Co-Chair, would bar NCDOT from spending the new federal high speed rail money (over $500 million) or seeking any new money. Representative Killian’s bill would follow the lead of states like Florida, Ohio and Wisconsin who have turned down a total of $3.6 billion in federal grants for high speed rail.
Representative Killian defends his bill stating the high speed rail project will incur an additional financial burden on the citizens of NC for annual maintenance and repair and could slow down freight traffic leading to a negative impact on commerce. However, there is no state match obligation required to receive the federal money and the cost of maintenance and operations is likely to be far outweighed by the positive economic and mobility impacts. Additionally, the improvements that are scheduled to be made to the tracks and grade crossings would actually improve freight traffic and commerce. Scott Saylor, President of the NC Railroad says that the new project will actually relieve a busy traffic bottleneck, making it easier for freight and passenger trains to pass slower trains between Greensboro and Charlotte. “The goal is to ensure that neither freight nor passenger trains run at the expense of the other.” said Saylor.
For over a year now, the NCDOT has been meeting with stakeholders to prepare them for the rail project and let them know of the jobs that would be created - an estimated 4,800 – with almost 500 of these projected to be in private engineering consulting firms. Additionally, the funding will create $35.6 million in new business for engineering firms who will do the planning and design for the construction and help the state manage the projects. This project will help revitalize our industry which continues to suffer from the crash in commercial and government construction activity over the last two years.
A coalition of transportation advocates, including the Association of General Contractors, Carolina Asphalt Pavers Association, NC Metropolitan Coalition of Mayors, ACEC and PENC and others have been meeting with transportation leaders all week voice our opposition to both of these bills. Please call or e-mail your legislators today and:
1) urge them NOT to cap the gas tax at less than 34.2 cents and
2) oppose efforts to turn back federal grants for rail improvements between Charlotte and Raleigh that will positively impact commerce and mobility.
Both do nothing to retain or create jobs and have no impact on reducing the state’s projected budget deficit in the general fund.
Last week at the monthly E-PAC luncheon, House Appropriations Chair, Representative Harold Brubaker, spoke specifically about two state programs that provide funding for engineering projects – Rural Center Grants and the Clean Water Management Trust Fund. Representative Brubaker praised the Rural Center and thinks “they were doing good things”. No mention was made of drastic changes or cuts. However, Representative Brubaker stated that the Clean Water Management Trust Fund, currently funded at $50 million will likely be reduced to $10 million in the House proposed budget.
The NCDENR continues to come under fire by the Republican controlled legislature. The latest bill, sponsored by Senator Don East would move hundreds of employees and programs from NCDENR and DPI to the state Department of Agriculture. The bills call for the Division of Forest Resources, the Division of Soil and Water Conservation, and the public school's Child Nutrition Program to be moved under the administration of the Department of Agriculture. Sen. Don East, R-Surry, a primary sponsor of all three bills, said the legislation is an attempt to find better administrative fits for the programs. East said he is especially interested in moving non-regulatory functions out of the "the premier regulatory agency," meaning DENR. Both DENR and the DPI are opposed to the bills.
The Governor today announced her intentions to move forward with her own plans to restructure state government – consolidating 14 departments into 8.
Read more here:
Gov. Beverly Perdue is expected to announce today that she is moving forward with the broadest restructuring of state government in decades, as part of her effort to deal with the budget shortfall. The governor will issue an executive order merging 14 high-level state functions into eight, in an effort to streamline state government and save money, said Chrissy Pearson, Perdue's spokeswoman. "The governor came into office intending to change the way state government works for the people," Pearson said. "This is another step down that path." Perdue is proposing to combine the departments of Juvenile Justice, Correction and Crime Control, and Public Safety into a new Department of Public Safety. She is also proposing to move the Employment Security Commission into the Department of Commerce. She further plans to move the Department of Administration into a new Department of Management and Administration that will include the Office of State Personnel and Information Technology Services.
Perdue outlined her reorganization plan in December in a speech in Pinehurst, and said she would propose the changes when the legislature convened. The major change from her original proposal was that she decided to leave the controller's office independent, rather than folding it into the Department of Administration as she originally proposed. That is because most states with AAA bond ratings have independent controllers, Pearson said. The governor has said the reorganization would save money by eliminating duplication, by making state government more efficient, and by reducing the work force, particularly middle management. She has suggested that there is no need for 377 human resources positions in state government, not including 60 in the Office of State Personnel, or 703 financial positions or 149 purchasing staff. The legislature has the authority to reject the plan. And the consolidations cannot move forward without funding by the legislature, Pearson said. The reorganization comes as the state faces a projected $2.4 billion budget shortfall for the fiscal year beginning July 1.(Rob Christensen, THE NEWS & OBSERVER, 3/25/11).
The next Regulatory Reform Commission meeting is scheduled for Monday, March 28th in Jamestown.
- 1 p.m. | The Joint Committee on Regulatory Reform collects public comment on the burden of state rules and regulations, Guilford Technical Community College – Jamestown Campus, Koury Hospitality Careers Center Auditorium, 601 High Point Rd., Jamestown. Contact: Jordan Shaw, 733-3451.
Please attend these meetings if you can to voice your concerns over burdensome state rules and regulations.
Also, please continue to send your comments and e-mails to PENC so we can incorporate these into the summary we will be submitting to the Commission.
The NC Licensing Board of Examiners for Engineers and Surveyors has obtained a legislative sponsor and is moving forward with legislation that will make technical, clarifying changes in the engineering and surveying statutes and more closely align some sections with the national model law. As reported in a previous issue, three substantive changes that the Licensing Board had originally considered including in the legislation have been removed and will not be included in the final draft bill. These include:
- Giving the licensing board jurisdiction and the ability to levy a civil penalty over non-licensees for violating 89c. Currently 34 states’ engineering boards have this authority. However, there are no other professions in NC (doctors, lawyers) that have this authority. The power to levy a civil penalty would apply to any unlicensed person, firm, partnership, organization, association, corporation or other entity in an amount not to exceed ten thousand dollars for any violation of 89C.
- Increasing the civil penalty for surveyors from $2,000 to $5,000. This is the current amount for engineers and has been since 2003.
- Requesting a fee of $100 annually for sponsors of continuing education programs to offset the administrative costs involved with the auditing of CPC programs.
Additionally one other proposed amendment that had originally been included in the board proposal in its efforts to more closely align NC engineering statutes with the national model law has been removed and will not be included in the final draft bill.
- Eliminating the waiver allowing a person with 20 years or more engineering experience to be eligible for admission to the PE exam
Legislation was introduced this week by Representative George Cleveland of Onslow County that would repeal Senate Bill 3 – the so called “green energy” law.
The legislation, enacted in 2007, requires energy companies to meet 12.5 percent of customer’s energy demand through renewable sources or conservation by the year 2021. Progress Energy and Duke Power have both invested heavily in these areas and oppose Representative Cleveland’s efforts to repeal the current law.