North Carolina General Assembly Week in Review

April 3, 2015

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Legislature Works on Tax, Transportation Issues in Busy Week

Members of the North Carolina General Assembly had a full schedule this week, considering bills on everything from restructuring theState’s sales tax plan to reopening one of the State’s largest inlets. Notably, the state gas tax decreased from 37.5 cents to 36 centson April 1st after an agreement was reached between House and Senate members and signed by Gov. Pat McCrory (R-NC). Bothchambers adjourned on Thursday and will stand in recess throughout next week for a rare spring recess.

Legislators Float Alternative Proposals for Distributing Sales Tax Money

As opposition grew against a plan authored by Senate Republicans to redistribute sales tax revenues from urban counties to rural ones,two competing bills were filed this week, both with the aim of boosting rural revenue without leaving a hole in the budgets of urbancounties. In the Senate, Republican Sen. Bob Rucho (R-Mecklenburg) introduced Senate Bill 608, the Simple and Fair Formula for SalesTax Distribution, which he says would prevent urban areas from losing money by expanding services that are taxed. Sen. Rucho is alsocalling for an increase in sales tax revenue statewide by about $66 million to ensure that the State has more money to divvy up. In theHouse, Rep. Howard Hunter (D-Ahoskie) filed a bipartisan proposal along with Finance Chairmen Jason Saine (R-Lincoln) and Mitch Setzer(R-Catawba). House Bill 518, the County Sales Tax Flexibility Act, would allow all counties to raise local sales taxes by aquarter-cent without a voter referendum. The bill is also supported by the North Carolina Association of County Commissioners.

Read SB 608& HB 518

Pressure Ramped Up On Senate to Pass Historic Tax Credit Bill

A proposed new tax credit for redeveloping the State’s historic buildings passed the House last week, but members held a newsconference Tuesday morning to continue to press the plan as the legislation moves to the Senate. House Bill 152, the New HistoricPreservation Tax Credit has been openly criticized by senators who say that they will oppose any to efforts to change the overhaul ofthe state tax code passed two years ago. Yet a bipartisan group of House members are emphasizing that the credit helps push the taxreform effort forward. Speaking at the news conference on Tuesday, Rep. David Lewis (R-Harnett) said of the historic tax creditproposal “This plan is entirely consistent with our desire to create jobs and foster economic development, this will spur economicdevelopment.” The old historic preservation tax credit expired on Jan. 1st of this year as part of the tax reform effort andGov. Pat McCrory (R-NC) has been trying to revive it, calling it a vital economic development tool for both urban and ruralcommunities. The new tax credit would be capped at $4.5 million for income-producing structures, while the credit fornon-income-producing properties would be capped at $22,500. The total cost for the tax credit is estimated to top out at $8 million peryear and would expire in 2021. House

Read HB 152here

House Gives Nod to Biosimilar Drugs

A bill that would allow North Carolina to join the growing list of states to prescribe how pharmacists may substitute “biosimilarinterchangeables” for complex medications was given preliminary approval by the House on Wednesday. Most people are familiar withgeneric medications, which are chemical copies of name brand drugs offered at cheaper prices. Biological drugs, however are harder tocopy. Their molecules are bigger, and they’re typically produced using living organisms. Rather than being exact copies, biosimilarscarry out the same functions, but are not chemically identical. They have been used in Europe since 2006, but the United States did notbegin to allow their use until the Affordable Care Act passed in 2010. Speaking at a press conference on Wednesday, Rep. Nelson Dollar(R-Wake), one of the bill’s primary sponsors, said of the measure “Biosimilar interchangeables are so close to the original drug thatthey are considered functionally the same. We anticipate biosimilars will offer the same life-changing effects that generic drugs do ifthey are allowed to be substituted.” The proposal, House Bill 195 Allow Substitution of Biosimilars, makes clear that pharmacists couldsubstitute a biosimilar interchangeable with a doctor’s permission. It also requires pharmacists to notify doctors when a substitutionis made.

Read HB 195 here

Lawmakers Scramble to Reopen Oregon Inlet

State House and Senate lawmakers scrambled this week to obtain funds to reopen Oregon Inlet and to dredge other inlets and ports. Houselawmakers voted to allow Dare County to raise its local sales tax by a quarter-cent to finance dredging, while Senate leaders worked toallocate money into the State’s Draft Dredging Trust Fund. The U.S. Coast Guard declared Oregon Inlet closed on March 28 as a result ofsand shoals that are blocking the main channel under Bonner Bridge. Under the order, no boat with a draft greater than 2 feet can comewithin 100 feet of the bridge. Violators could face fines of up to $32,000. Dredges are currently on their way to the inlet for aone-time federally funded remedy, but Sen. Bill Cook, (R-Carteret), said the sand will inevitably come back, and the state has to beready to deal with it. On Wednesday, the Senate Finance Committee gave unanimous approval to Senate Bill 160, Enhance Safety &Commerce for Ports/Inlets, which would take about $6 million from the Department of Commerce for the state’s Shallow Draft DredgingTrust Fund. Cook said $4 million of that would be earmarked for Oregon Inlet, which would insure that it stays open for business, fromcharter and commercial fishing operations to cargo and boat builders. The bill passed its final House vote Wednesday afternoon on avote of 112-4 and now goes to the Senate.

Read SB160 here

Child Vaccine Bill “Dead” in the Senate

After a wide range of protests this week, Senators Jeff Tarte (R-Cornelius), Tamara Barringer (R-Cary) and Terry Van Duyn (D-Asheville)withdrew Senate Bill 346, Enact Stricter Immunization Requirements, on Wednesday. The bill would have expanded childhood vaccinationsand ended a religious exemption for parents who oppose them. “After hearing serious concerns about stricter vaccine and immunizationrequirements from our constituents and from citizens across the state, we have decided we will not move forward,” the three senatorssaid in a statement. The senators had introduced the proposal three weeks ago with the intent of bringing North Carolina law up tocurrent federal standards. But the fanfare that surrounded the bill’s introduction quickly turned into a public firestorm. Protesterspicketed the General Assembly. Some conservatives called it “a slippery slope” that would lead to the end of other religious freedoms.Under current North Carolina law, children must be immunized before attending public and private schools, but exemptions are allowedfor medical or religious reasons. For the 2013-14 school year, 179 children received medical exemptions, and 1,204 got religiousexemptions, according to the state’s Department of Health and Human Services.

Read SB 346 here


Senior Vice President 

Senior Vice President 

Franklin Freeman
Senior Vice President 

Bo Heath
Senior Vice President 

John Merritt
Senior Vice President 

Senior Vice President 

Kerri Burke
Vice President 

Assistant Vice President 

Sarah Wolfe
Assistant Vice President 

Philip Barefoot
Research Assistant