June 12, 2015 Womble Legislative Update
By Unknown
The Senate needed a little more time to put the finishing
touches on its budget, so we didn’t get to see it this
week. We’re now expecting it to be released on Monday and passed by the
Senate by the end of the week.
Veto Override
On Thursday, the House overrode the Governor’s veto of SB 2 –
Magistrates Recusal for Civil Ceremonies, first approving an
often-criticized motion precluding debate before the vote was put to the
members. The Governor and House Leadership had been jockeying against one
another for members’ support since the May 28th veto, with a margin
so close that both sides were taking constant attendance. The final vote of 69
to 41 was a three vote cushion for the override with notable divergence from a
party-line vote. Three Republicans supported the Governor: Rick Catlin of
New Hanover County, Leo Daughtry of Johnston County and Paul Tine (former
Democrat) of Dare County. Three rural Democrats voted with the Republican
majority to override: William Brisson of Bladen County, Charles Graham of
Robeson County and Ken Waddell of Columbus County – these Democrats had
previously supported the bill.
Economic Development
The Senate has at last unveiled its economic development
plan which includes lowering personal and corporate income taxes and expansion
of the sales tax base. The Senate stripped the language from the economic
development bill backed by the House and Governor and inserted new language for
its plan, which was presented to the Senate Commerce Committee on
Wednesday. No votes have been taken yet.
Some highlights of the plan include:
- Reduction of corporate income tax rate to 4% effective
January 1, 2016; 3% effective January 1, 2017
- Repeals the privilege tax on banks
- Phase-in of single sales factor over three years
- Reduction of the franchise tax rate to $1.00 per
$1,000, effective in 2017
- Reduction of personal income tax rate to 5.5% in 2016
- Expansion of sales tax base to include
repair/maintenance services, pet car/veterinary services, and advertising
services
- Phase-down of the nonprofit sales tax refund
- New formula for local sales tax distribution to give
more to rural counties
- Cap on total local sales tax rate at 2.5%
The Senate’s proposed committee substitute for HB 117 can be
found here: http://www.ncleg.net/documentsites/committees/senate2015-67/06-10-15/PCS%20for%20H117.pdf
A summary of the plan can be found here: http://www.ncleg.net/documentsites/committees/senate2015-67/06-10-15/Summary%20of%20Plan%20Components%20for%20PCS%20H117.pdf
Another issue that the House and Senate have differing plans
for is Medicaid reform. While we’ve been hearing that the Senate budget
will include a Medicaid reform proposal to allow private managed care companies
to compete with provider-led organizations, the House has decided to move its
Medicaid reform bill that excludes managed care companies. HB 372 –
2015 Medicaid Modernization – received a favorable report in
House Health Committee and now heads to House Appropriations. Supported
by the North Carolina Hospital Association, NC Medical Society, and the
Department of Health and Human Services, the bill would transition the Medicaid
program from fee-for-service to full-risk capitated health plans operated by
provider-led entities to manage and coordinate the care over the course of five
years. Private managed care companies do not have a role in this framework.
The two chambers were unable to reach a compromise last year
on Medicaid reform, but both insist that reform is imperative. This long
session might really live up to its name this year!
Residential Design Controls
SB 25 –
Zoning/Design & Aesthetic Controls – has been approved by
the legislature and sent to the Governor for his signature. The new law
will prohibit cities and counties from adopting regulations controlling
building design elements for one- and two-family dwellings. This would
include:
- Exterior building color
- Type or style of exterior cladding materials
- Style or materials of roof structure or porches
- Exterior nonstructural architectural ornamentation
- Location and architectural styling of windows or doors
- Number, type, and interior layout of rooms
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