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NCACC Legislative Brief
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Week of September 2, 2019
As Hurricane Dorian continues its path over North Carolina, we hope everyone is staying safe and out of harm’s way. Visit readync.org for information about the storm and thank you for all the work you do to both prepare and rebuild North Carolina counties. Please be in touch if there is anything your Association can do to help.

The General Assembly took an extended Labor Day break this week and did not hold any committee meetings or voting sessions. Late last week Governor Cooper took action on several of the mini budget bills the General Assembly approved. Governor Cooper signed into law legislation centered on salary increases for law enforcement and other state employees.

However, Governor Cooper vetoed House Bill 555 Medicaid Transformation Implementation. H555 provides funding for the operation of the Medicaid program and the transition to managed care during the 2019-2021 fiscal biennium, and makes other necessary changes for the transition to managed care to begin as scheduled on November 1, 2019 (more on this below). The language and appropriation were previously included and approved as part of the 2019-2021 budget. Although the bill passed the General Assembly, it may prove difficult for legislators to override Governor Cooper’s veto as the bill passed by a final vote of 25-20 in the Senate and by a vote of 57-52 in the House, which are not veto-proof majority votes.

Related to the timing for Medicaid reform, this week the North Carolina Department of Health and Human Services announced the Medicaid transition to managed care will be pushed back from November 1, 2019 to February 1, 2020. The transition was originally scheduled to happen in two phases, but all counties will now move to managed care in February.

Upon return next week, General Assembly leadership indicated the legislature will consider more piecemeal budget legislation focused on school safety, prison safety, and disaster recovery and relief.  However, since that announcement, a bipartisan three-judge panel ruled legislative maps to be unconstitutional and gave legislators a deadline of September 18, 2019 to redraw maps. The ruling comes after a nearly 10-year court battle. The Senate and House Redistricting Committees have scheduled meetings early next week to begin the process.

Negotiations Continue on Sales Tax Flexibility Legislation
NCACC urges your continued contacts to the House and Senate conferees currently negotiating the final version of Senate Bill 681 Rural Health Care, Local Sales Tax Flexibility, Utility Accounts that currently includes greater sales tax flexibility. Because S681 includes several different provisions, it is possible that the conference committee could remove the sales tax flexibility language. As negotiations are ongoing, NCACC asks you to contact the House and Senate conferees and express to them how retaining the sales tax flexibility language will benefit your county.

Talking points to consider when contacting a conferee:
  • Please retain the sales tax flexibility language currently found in S681.
  • The provision is not a mandated sales tax increase, but rather authorizes counties, subject to voter approval, to levy an additional local option sales and use tax at either ¼ cent or ½ cent within current sales tax caps.
  • By supporting local option sales tax flexibility, you are giving each county a choice about expanding their revenue base to meet local needs.
  • The tax must be approved by voters in a referendum and it must be placed on the ballot in quarter-cent increments.
  • Counties are able to use specific ballot language designating “public education purposes” on the ballot.
  • Counties could use the tax for public school capital needs, teacher supplements, community college needs, or any public purpose, depending on the ballot language.
  • Counties spend on average 30% of their budgets on education and need this tool to help pay for the high costs of school construction, which add up to more than $8 billion statewide.
  • Counties appreciate every dollar appropriated by legislators to help meet these staggering needs.
  • Having this additional tool can help counties contribute more toward public education, or various mandated services for residents like social services, public health, safety and more.
 
For more information on sales tax flexibility, please contact NCACC Associate General Counsel Paige Worsham.

Legislation Addressing County Goals Still in Play
As the session winds down, legislation addressing Association priority legislative goals remains in committee or otherwise awaits action. Please contact your legislators to express your support for these important proposals:
 
House Bill 431 Fiber NC Act: allows local governments in under/unserved areas to build broadband infrastructure and lease that equipment to service providers. H431 gained approval in the House State and Local Government committee and now resides in the House Finance committee, though no date has been set for its hearing. NCACC encourages its members to call your House member(s), especially any of those on the House Finance committee, and urge them to support counties’ top legislative goal of expanding broadband access to unserved and under-served areas of North Carolina.
 

House Bill 79 Academic Alignment/Boards of Education & CC: allows local boards of education to align school calendars with the start of the local community college. The bill passed the House earlier in session and now sits in the Senate Rules committee.
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