Senate unveils and approves 2019-2021 budget
The Senate approved its version of the 2019-2021 fiscal biennium state budget this week, which includes many top county priorities. The Senate’s budget plan provides new funds, in addition to the lottery, for public school and community college capital projects, repeals the ability for school boards to sue counties over appropriations to the public school capital outlay fund, raises the amount of funds available through the state’s broadband grant program, and requires collection of sales tax by online third-party marketplace facilitators. Budget highlights include the following:
- Authorizes $1.67 billion from State Capital and Infrastructure Fund to K-12 schools for new construction, renovations and repairs through the 2028-29 fiscal year
- Authorizes $500 million from State Capital and Infrastructure Fund to community college system for new construction, renovations and repairs through the 2028-29 fiscal year
- $100 million in lottery proceeds each year of the biennium for the Public School Building Capital Fund
- $95 million in lottery proceeds in 2019-20 and $109 million in lottery proceeds in 2020-21 for the Needs-Based Public School Capital Fund
- Repeals ability for local boards of education to sue boards of county commissioners over appropriations made by the county to the public school capital outlay fund
- Provides funding for school safety grants for school resource officers, school mental health support personnel, safety equipment, safety training, and the students in crisis program, some of which require a local match
- $64 million to implement “Raise the Age” including court positions, costs associated with transportation, funding for additional bed space and funding for Juvenile Prevention Councils
- Provides $1.5 million for stream debris removal
- Funds “future disaster studies” by the NC Policy Collaboratory for $2 million
- Appropriates $5 million for the North Carolina Office of Recovery and Resiliency to assist financially distressed local governments
- Provides $10 million to the Department of Environmental Quality for “disaster related infrastructure”
- Appropriates $1 million for grants to assist jails in four counties in providing addiction treatment
- Appropriates $210 million from the Medicaid Transformation Reserve to prepare for the transition to managed care for Medicaid beginning November 1, 2019 in 27 counties and February 1, 2020 in the remaining 73 counties.
- Delays deployment of child welfare and aging components of NC FAST in counties that are not pilot counties until at least October 1, 2019
- Increases the recurring reduction to LME/MCOs by $15 million each year of the budget
- Increases the state-county special assistance personal needs rate and the foster care and adoption assistance rates; Counties are required to pay 50% of the cost of these programs
- Does not increase funds for local health department communicable disease programs
- Transfers $15 million recurring from the State Capital and Infrastructure Fund for the GREAT grant for rural broadband
- Provides $7.5 million in 2019-20, and $10 million in 2020-21 to the newly established Viable Utility Reserve; Funds will be used to provide grants to distressed water infrastructure entities for assessments and inventories, merger or regionalization studies, or infrastructure projects
- Modifies part of the film grant appropriations to be non-recurring, and reduces appropriation by $1.5 million
- Requires “marketplace facilitators” to collect and remit sales tax on behalf of third-party sellers beginning Sept. 1, 2019
NCACC will provide full analysis of the Senate budget early next week. Leaders from the House and Senate will shortly begin deliberations to reconcile each chamber’s respective budget plans, and present a compromise spending plan to the Governor, most likely by the end of June. NCACC will share county funding priorities and preferences with budget writers to inform their debate as they craft a budget compromise.
Historic rehabilitation tax credit bill creates new disaster area credit
House Bill 399 Historic Preservation Act of 2019 increases the tax credit, effective for taxable years beginning Jan. 1, 2020, allowed for rehabilitating income-producing historic structures by raising the amount of expenses allowed. The bill also increases the expenditure threshold for the development tier bonus and the targeted investment credits, and creates a new disaster relief bonus credit equal to 5% of qualifying rehabilitation expenses in a disaster area that do not exceed $25 million. H399 extends the expiration dates for the historic rehabilitation tax credit program by four years.
For more information on this legislation, contact Associate General Counsel Paige Worsham.
Regulatory reform legislation stalls in committee
Senate Bill 553 Regulatory Act of 2019 was discussed in the Senate Agriculture/Environment and Natural Resources Committee late last week. As previously reported, the legislation includes provisions of some concern to NCACC, including continuing local franchise agreements and flood safety.
Committee members from both sides of the aisle expressed concerns about a provision in the bill that would allow certain electronics to be disposed of in landfills. Following this discussion, the bill was displaced to be discussed and voted at later date.
For more information on environmental issues, please contact Government Relations Coordinator Amber Harris.
Legislation with finance officer provisions on Governor’s desk
The House this week concurred with changes to House Bill 233 State Auditor/Local Finance Officer Amendments, which was reported in the brief two weeks ago. The provisions in the bill concerning local government finance officers would authorize the Local Government Commission to establish minimum qualifications for finance officers and require training if the local government has audit finding or the officer fails to meet those minimum qualifications. The bill is now on Governor Cooper’s desk for his decision.
For more information on this legislation, contact Director of Government Relations Johanna Reese.
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