Friday, April 10, 2015, 4:07 PM

March 20, 2015 Legislative Update

The General Assembly is in full spring tilt. Next Thursday is the bill introduction deadline for non-money bills and folks are busy pitching their ideas and lining up support. 


Spring weather in Raleigh brought with it Ag Day – celebrating North Carolina’s $100 Billion agriculture economy. “Republicans Against Marijuana Prohibition”  joined in this year which just confused everyone. Some Republican lawmakers expressed their relief to us when a rain shower caused “RAMP” to roll up its outdoor display and leave.


The spring weather may also have caused the Ethics Commission to address conflicts of interest that may arise from relationships of a private and personal nature between lobbyists and legislators. We expect a hearing on HB 252 in the next week.


UNC Board of Governors elections:

This week the House and Senate elected members to the University of North Carolina Board of Governors. The BOG is the governing body for the constituent institutions of the University of North Carolina.

Senate elected members are:

·         John Fennesbresque, a Charlotte attorney

·         Lou Bissette, an Asheville attorney

·         Frank Grainger, a Cary businessman

·         Anna Spangler Nelson, a Charlotte businesswoman

·         Tom Goolsby, a Wilmington attorney and former member of the NC Senate

·         Temple Sloan IIII, Raleigh, former CEO of General Parts, Inc.

·         Michael Williford, a Fayetteville attorney

House elected members are:

·         Pearl Burris-Floyd, Dallas, NC, VP of the Greensboro Partnership

·         C. Philip Byers, Forest City, businessman

·         Walter Davenport, accountant from Raleigh, former member of the Board of Governors

·         Joe Thomas Knott III, Raleigh attorney

·         John Alex Mitchell, Durham developer

·         James Holmes Jr., Raleigh businessman

·         David Powers, Winston-Salem businessman (RJR)

·         Mary Ann Maxwell, Goldsboro businesswoman


Economic Development:

SB 305 - An Act to Provide Cost Recovery for Acquisition of Joint Municipal Power Agency Ownership Interest in Generating Facilities. This bill is a huge boon for the towns in eastern North Carolina that got together to build their own power plants decades ago which ended up resulting in sky high debt payments causing very high power bills in the region impacting households and the ability to attract industry to the area. The bill allows Duke Energy to purchase the plants for $1.2 billion (of the $1.8 billion outstanding debt) and authorizes a bond to retire the remaining debt. The bill received unanimous support in Senate Commerce Committee and awaits a hearing in the Senate Finance Committee next week.


The Senate on Economic Development:

On Tuesday, Commerce Secretary John Skvarla spoke to members of the Senate Finance Committee urging support of HB 117NC Competes, Governor McCrory’s economic development plan.  It increases the JDIG cap from $22.5 million to $45 million and offers tax breaks for jet fuel and technology data centers.  Skvarla and the bill got a cool reception in the Senate with the bill being referred to the Senate Rules Committee (read: parking lot).


Added to the Senate skepticism regarding cash grant incentives is heightened fighting against urban areas on behalf of rural areas (contrary to what new census numbers told us to expect). Historically, 80% of JDIG incentives have been going to Wake and Mecklenburg Counties. Senators argued that rural counties desperately need more employers and that this inequity just intensifies the divide between rural and urban areas. 


The Senate responded with their own economic development plan - SB 338Economic Development/Tax Modifications.  The Governor and Speaker both expressed disappointment of the Senate plan, but with 26 Senate co-sponsors it will be hard to slow it down.


The Senate plan would:

·         Reduce the state’s corporate tax rate from 5% to 3% over two years (which would result in about $500 million less in state revenue).

·         Limit Wake, Mecklenburg, and Durham Counties to a formula tied to their percentage of the population, which would limit them to no more than about half of the state’s incentive money.

·         Shift to single sales factor apportionment, which would calculate companies’ tax liability based entirely on sales instead of factoring in payroll and property value (estimated to cost the state $75 million by Senator Berger’s office and $180 million by the governor’s office).


The Senate also introduced SB 326 Increase JDIG Program Funding – was introduced by Senator Rick Gunn on the heels of the Senate’s economic development plan.  This bill would immediately add $5 million available to the JDIG fund to offer as incentives in the short-term while the legislature debates the broader bill.  Senator Berger says to expect it to pass the Senate next week.


Of Interest:

Judicial Retirement Age

HB 205An act to increase the mandatory retirement age for judges and justices of the General Court of Justice and for magistrates, and to allow judges, justices, and magistrates to serve until the end of the calendar year in which they attain the age of 75 – passed a House Judiciary Committee on Wednesday.  It would increase the mandatory retirement age from 72 to 75 to reflect the fact that people are living longer and healthier lives.  Sponsor Rep. Schaffer told the committee that 19 states have no mandatory retirement age. The bill will now go to the House Committee on Pensions and Retirement.


Oral Chemotherapy

HB 306An act relating to health benefit plan coverage for orally administered anticancer drugs – was filed Wednesday. The bill seeks to treat oral chemotherapy the same as other forms of chemo for insurance coverage purposes. This ball stalled in the Senate last year with all other bills that included an “insurance mandate”.


If you’re a bill watcher you’ll notice that Senate bills are referred to the Rules Committee when introduced. We’re hearing that committee chairs have to request to have a bill released to their committee for a hearing.


Next Week:

·         We expect to see a bill filed on behalf of LegalZoom in NC. We hear lobbyists from the NC Bar are working for compromise legislation, but let us know what you’re hearing.

·         A bill will be filed to offer a driving privileges card for illegal aliens as a public safety measure and to require them to purchase auto insurance which they currently cannot.

·         There is a fight brewing to increase state revenues with Sweepstakes, Lottery and Video Lottery. The only bill we’ve seen filed is Rep. Stam’s to require the Lottery Commission have the express permission of the General Assembly to expand its gaming offerings.  The bill was pulled from a Judiciary Committee calendar last week when the Lottery Commission changed its position on the bill from neutral to opposing.

·         House and Senate Page Programs:  Bella DeVivo, Broughton High School freshman and my very own kid, will serve as a House Page for our very own Rep. Rob Bryan! If you have a high school student who wants to learn a little about the legislative process, and earn a cool $150, they should apply to the page program.


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