♦ Hello, Friends!
Once again, Mother Nature rearranged the legislative calendar and a session that was already moving as slow as molasses, was brought to a complete halt.
Unlike the week before, when cancellations were called daily, frequently at the last minute, this past week, the snow on the ground and the dire weather forecast for Wednesday and Thursday prompted leadership of the House and Senate to cancel the week after Tuesday’s session. A skeletal session was scheduled for Wednesday and Friday, while Thursday (when the weather and the roads were projected to be at their worst), session was cancelled altogether.
The calendar for this week includes committee meetings. Finally, enough bills have been filed (121, so far in the House) and assigned to committees, that some committees have enough to warrant calling a meeting. No doubt the pace will become hectic very quickly, as for all intents, we have a lot to do and less time to do it in if the plan is to adjourn by the end of June.
I expect this week to be somewhat contentious as HB 117 NC Competes is discussed in caucus and in committee. The bill, sponsored by Representatives Susan Martin, Charles Jeter, Jeff Collins and Bob Steinberg, is the Governor’s incentive reform bill. The legislation proposes to rebrand the JDIG (Job Development Investment Grant) and One North Carolina Fund programs into one common theme, called the Job Growth Reimbursement Opportunities. The “new” JDIG would become known as the Job Growth Reimbursement Opportunities – People Program, while the “new” One North Carolina Fund will become the “Job Growth Reimbursement Opportunities – Capital Small Business Program”. The revised JDIG would also have its funding cap raised by $27,500,000 to a limit of $45,000,000. The bill also appropriates $20,000,000 from the Department of Commerce and sweeps unencumbered funds from the Job Catalyst Fund to the Site Infrastructure Development Fund, which would be renamed the Acceleration Fund. Other incentives in the bill include extending the fuel tax exemption for commercial airlines and approving a sales tax credit or exemption for data centers. It is a relatively easy bill to read and consists primarily of just 5 or 6 substantive parts. Here is a link to it for your review: Edition 1 [HTML]
In case that discussion doesn’t get legislator’s adrenalin flowing, debate on SB 20, is pretty much guaranteed to. SB 20 IRC Update / Motor Fuel Tax Changes (Edition 3 [HTML]) is comprised of two parts that have nothing to do with each other. Part 1 pertains to the Internal Revenue Code and is a somewhat time sensitive piece, needing to be passed and signed into law sometime in March. This part should be a stand-alone bill so it can be properly debated and voted upon, based on its own merits. It contains provisions concerning adjustments that are made when the state “decouples” from federal accelerated depreciation and expensing guidelines. Additionally, it has a section (Section 1.3) that makes changes or modifications to calculating adjusted gross income. All of these changes are critical to pass as soon as possible so people can calculate their adjusted income and file their taxes. It is tethered to the gas tax changes in an attempt to pressure the House to quickly accept the bill with little or no revisions, as revisions to the bill, will require it to go back to the Senate for a vote of “concurrence”, further delaying the IRC changes.
In Part 2, SB 20 doesn’t actually stabilize the gasoline tax. In fact, it removes the “ceiling cap” (a limit on how high the tax can climb upward) that we passed a year or so ago and replaces it with a “base cap” (how low it can decline), setting it at 35 cents, effective March 1, 2015. The gas tax is currently at 37.9 cents. The next adjustment of the gas tax is scheduled for July 1, 2015 and is expected to drop to 29 cents – roughly 9 cents a gallon less from where it is today. SB 20, however, will keep it at 35 cents, which, in effect, will be a passive tax increase of roughly 6 cents a gallon more than the projected 29 cents. It also changes the current “multiplier” in the gasoline tax calculation from 7% to 9.9%. If SB 20 were in effect today, the gas tax today would be around 46 or 47 cents per gallon based on those guidelines.
The state, particularly the Department of Transportation, cannot afford the revenue loss from the 2 cent tax cut that SB 20 appears to give (reducing the current tax rate [37 cents – 35 cents] from March 1 to July 1) so, to recover the revenue, quite a few budgetary adjustments and claw backs from other areas would be made.
There is no argument that the state’s reliance on the gas tax and related vehicular fees/fines is insufficient to meet our immediate transportation needs. We have thousands of miles of roads and bridges that need repaired/replaced or upgraded. Our population is expected to swell to 10 million very soon and that means our infrastructure must be able to accommodate many more vehicles on the roads than today. We must, and will, consider all potential revenue streams and determine those that will best fulfill our current and future transportation needs, enabling us to build ahead of our population growth and support our economic growth in a sustainable manner.
SB 20 would have been a better bill if it had simply proposed a 35 cent base cap effective July 1, 2015 and left the ceiling cap at its current level of 37.9 cents. This would have been a defensible and explainable course of action that the general public could understand and approve of. It would stabilize the gas tax within a 2 cents range, providing a more predictable revenue forecast capability. Then the Assembly could put that revenue stream to the side and work diligently to determine supplemental revenue sources.
Obviously, I will not be supporting SB 20 in its current form.
The Governor’s budget is also expected to arrive at The General Assembly this week. Appropriations Chairs are meeting, getting their instructions and listing their priorities. Once subcommittees make their reports to the caucus, more discussion/debate is sure to occur.
Then there is the expected debate over Medicaid reform – the House leadership and the Senate are not exactly seeing eye to eye on the best solutions. While the House leaders favor a provider drive model, the Senate is advocating for a capitated vendor plan and moving the DMA (Department of Medical Assistance) out of the Department of Health & Human Services to become autonomous.
As you can see, this week promises to be watch–worthy. I will continue to keep you posted as we move on.
Thank you to all who were able to attend my Town Hall this past Saturday, at the Commissioner’s Chambers. We did send a press release announcing the event but none of the media chose to use it. I will be holding another near the end of March. We will announce the date here in the Newsletter for you, as always.
Here is a recap of last week, as summarized by the MVA Public Affairs NC Legislative Update. This will include links to some current stories that you might have missed and a complete list of committee meetings scheduled for this week and for the near future.
Committee meetings are open to the public, so if you would like to attend one that is focusing on a subject of interest to you, feel welcome to attend. Meeting schedules are subject to change (sometimes at the last minute), so be sure to confirm the schedule on the General Assembly website or by contacting the office of the Committee Chair, before you make the two hour drive to Raleigh. If you would like to attend a meeting, but can’t make it to Raleigh, you can still “attend” many of the meetings by listening online. You must first determine in what room the committee is meeting. If the committee meets in either room 544 or 643, you can listen online. To access the audio version of a meeting, go to: http://www.ncleg.net, click on “audio” on the bar near the top, then select either “Finance Committee Room (Room 544)” or “Appropriations Committee Room (Room 643)” to listen.
ON THE FLOOR
This week, the Senate passed S 109, Joint Session/State of the Judiciary, and S 2, Magistrates Recusal for Civil Ceremonies.
The House passed H 65, Wilkes Fox Trapping.
COMMITTEES
Joint Appropriations Committee Meetings
The House and Senate continued with joint appropriations committee meetings as they work towards putting together a budget for this year. On Tuesday, individual subcommittees met to look at specific budget areas such as Transportation, Health and Human Services, Education, Public Safety, General Government and Information Technology. These Committees took this time to review the current budget and identify key priorities for the upcoming year. Members will continue their work when they return next week.
Senate Commerce Committee
The Committee met on Tuesday, February 24, to hear from Commerce Secretary John Skvarla on the need for incentive programs in job recruitment and his plans to turn the N.C. Zoo into a major tourist attraction. Skvarla highlighted the incentive programs used by other states that have attracted large manufacturing operations and the ancillary impact on the local economy. He urged members of the Committee to support a bill introduced in the House that would increase the amount of money in the State’s incentive programs.
The plan for revitalizing the Zoo and turning it into a major destination includes a convention center, hotel and cable cars to move people through the park. Skvarla is working with other members of the Administration on the plan. The Commerce Committee will meet again on Tuesday, March 3 at 11:00.
House Finance Committee
The Committee met on Tuesday, February 24. There were no bills on the Committee’s calendar. Instead, the Committee heard presentations from legislative staff with respect to General Fund revenue sources and the State’s economic development incentives.
Senate Finance Committee
The Senate Finance Committee met on Tuesday, February 24 and Wednesday, February 25. On Tuesday, the Committee approved a proposed committee substitute for S 19, Revenue Laws Technical Changes. The bill was a recommendation of the Revenue Laws Study Committee and, as the title suggests, contains technical corrections related to State and local tax laws. The bill passed second reading in the Senate on February 25 and is on the calendar for final approval on Monday, March 2. On Wednesday, there were no bills on the Committee’s calendar. Instead, the Committee heard presentations from legislative staff with respect to the State’s economic development incentives.
IN THE NEWS
WRAL: FCC OKs Wilson to sell high-speed Internet outside city limits
Raleigh News & Observer: NC Secretary of State seeks fee hikes to help regulate crowdfunding
Raleigh News & Observer: NC senators look to modify McCrory’s jobs incentive plan
Raleigh News & Observer: NC Senate votes to force utilities to give tax cut to customers
Raleigh News & Observer: Governors expect Atlantic coast seismic testing for oil and gas in about 18 months
Charlotte Observer: Criminal charges in spills to cost Duke Energy $100 million
Associated Press: McCrory expansion delay smart to some, poor excuse to others
Associated Press: State gas tax, population growth help NC road funding
CALENDAR
Mon, March 02, 2015
7:00 PM
Session Convenes (House)
House
7:00 PM
Session Convenes (Senate)
Senate
Tue, March 03, 2015
8:30 AM
Appropriations on Department of Transportation (Joint)
1228/1327
8:30 AM
Appropriations, Transportation (Joint)
1228/1327 LB
8:30 AM
Appropriations, Justice and Public Safety (Joint)
415 LOB
8:30 AM
Joint Appropriations on Justice and Public Safety
415 LOB
8:30 AM
Appropriations on Education/Higher Education (Joint)
423 LOB
8:30 AM
Appropriations, Education (Joint)
423 LOB
8:30 AM
Appropriations, General Government (Joint)
425 LOB
8:30 AM
Joint Appropriations on General Government and Information Technology
425 LOB
8:30 AM
Appropriations, Health and Human Services (House)
643 LOB
8:30 AM
Joint Appropriations on Health and Human Services
643 LOB
10:00 AM
Joint Pensions & Retirement and Aging
544 LOB
10:00 AM
Pensions and Retirement (Joint)
544 LOB
10:00 AM
Education – K-12 (House)
Planning Year for CIHSs. (H18)
Education Innovation Task Force. (H35)
643 LOB
11:00 AM
Education – Community Colleges (House)
Year-Round Funds for CC UGETC. (H15)
Youth Career Connect. (H47)
643 LOB
12:00 PM
Transportation (House)
Military Veterans Special Plate. (H5)
Autocycle Definition and Regulation. (H6)
Passing Slow Moving Vehicles. (H60)
643 LOB
1:00 PM
Judiciary II (House)
0.00 Alcohol Restriction-All DWI. (H31)
Amend Habitual DWI. (H32)
Judicial Efficiency/Effect. Admin. of Justice. (H38)
Clarify Report Admissibility. (H59)
421 LOB
1:00 PM
Finance (Senate)
544 LOB
Wed, March 04, 2015
8:30 AM
Appropriations on Department of Transportation (Joint)
1228/1327
8:30 AM
Appropriations, Transportation (Joint)
1228/1327 LB
8:30 AM
Appropriations on Natural and Economic Resources (Joint)
421 LOB
8:30 AM
Appropriations, Agriculture and Natural and Economic Resources (Joint)
421 LOB
8:30 AM
Appropriations on Education/Higher Education (Joint)
423 LOB
8:30 AM
Appropriations, Education (Joint)
423 LOB
8:30 AM
Joint Appropriations on General Government and Information Technology
425 LOB
8:30 AM
Appropriations, Health and Human Services — CORRECTED (House)
643 LOB
8:30 AM
Joint Appropriations on Health and Human Services
643 LOB
10:00 AM
Agriculture/Environment/Natural Resources (Senate)
544 LOB
11:00 AM
Alcoholic Beverage Control — CORRECTED (House)
423 LOB
11:30 AM
Rep. Szoka-Press Conference (Time Change)
Press Room LB
12:30 PM
Judiciary I (House)
Charter School Financial Accountability. (H96)
415 LOB
Thu, March 05, 2015
8:30 AM
Appropriations on Department of Transportation (Joint)
1228/1327
8:30 AM
Appropriations on Natural and Economic Resources (Joint)
421 LOB
8:30 AM
Appropriations, Agriculture and Natural and Economic Resources (Joint)
421 LOB
8:30 AM
Joint Appropriations on General Government and Information Technology
425 LOB
8:30 AM
Appropriations, Health and Human Services (House)
643 LOB
8:30 AM
Joint Appropriations on Health and Human Services
643 LOB
10:00 AM
Environment (House)
544 LOB
Mon, March 09, 2015
10:00 AM
North Carolina Courts Commission
643 LOB
Mon, March 16, 2015
3:00 PM
Joint Legislative Program Evaluation Oversight Committee
544 LOB
Thank you for the opportunity to represent District 77 and to work on your behalf to help move our great state forward!
————————
Harry
Representative Harry Warren
N.C. House of Representatives
District 77, Rowan County
611 Legislative Office Building
Raleigh, North Carolina 27603
(919) 733-5784
Harry.Warren@ncleg.net
