NCGA Week in Review

February 2, 2018

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The legislature has been in a special session since January 10, however,lawmakers, who are awaiting rulings from the courts on redistricting suits,have been at a standstill for weeks. Interim committee meetings continuedto meet this week, discussing topics including, produce handlingregulations, data security and education finance reform. Additionally, theState Supreme Court issued a ruling striking down a merger of the StateBoard of Elections and the State Ethics Commission, and a US District Courtjudge ruled to restore some judicial primaries in 2018. According to HouseSpeaker Tim Moore (R-Cleveland), votes are expected next Thursday andFriday.

Spotlight on Charlotte City Council Strategy Meeting

This week, MWC Vice President Tricia Cotham, based out of McGuireWoods’Charlotte office, attended the Charlotte City Council’s annual retreat inDurham. Here is her report on the retreat’s biggest takeaways.

Snapshot of Charlotte:

  • 34 new residents a day
  • 17th largest city
  • Median age is 34
  • Unemployment rate is 5.4%
  • #1 city for millennials relocating
  • Median house value is $201,500

Charlotte City Council Holds Annual Strategy Meeting

The Charlotte City Council held their first retreat for the new council inDurham over the last three days. This “strategy session” is the first timecouncil members have spent a long period of time talking, planning,bonding, and learning together. This is an important opportunity since overhalf of the council members are new. Additionally, the council has facedsome early challenges so this time together is critical for working welltogether for Charlotte.

What were the main takeaways?

On day one, council members expressed their hopes for the council. Therewas an overwhelming theme and consensus around “leaving the communitybetter than we found it.” Mayor Vi Lyles stressed the importance of heridea of holding monthly three hour strategy sessions. Councilman BraxtonWinston reiterated the importance of being engaged within the community.Councilmember Greg Phipps discussed ways the council could take a moreactive role in helping citizens with day to day issues and concerns. Therewere some tense moments and exchanges during this segment. However, theexchange was categorized by members as “productive” and “needed.”

Council members were asked to share their big topics for the group to focustheir time over the next 12-18 months. The topics suggested by councilmembers were safety, transportation options, affordable housing, bikeplans, litter complaints, economic development, and how to work well as agoverning body. Staff will take these suggestions and provide moreinformation and create a timeframe and plan to discuss these ideas.

In an open session, council members expressed some frustration with the twoyear term and stated they would like to have four year terms. This wouldrequire legislative action and is unlikely. It is apparent that councilmembers are experiencing some learning curves with responding to theoverwhelming amount of emails they receive, scheduling events and balancingwork and family. This is a common dilemma faced by any public servant, andcity staff offered their commitment to help the members.

What else did they discuss?

Senior Economist Mark Vitner of Wells Fargo presented to council and staffon the “economy today.” Vitner encouraged city leaders to not just viewCharlotte as a banking town. He suggested that Charlotte must be seen anarea with a wealth of high-tech jobs or the area will fall behind. Vitnerstressed the importance of the city creating a stronger culture of learningto connect jobs into the workforce for the region’s future. Vitner alsopointed out that the area has a lot of “low skill jobs” and “high skill,high paying jobs” but the problem is the lack of jobs in the middle. Thecouncil heard the trend of “building up,” bringing people back into uptown,is not going away and that the millennial population wants to live, play,and work in close proximity to uptown. As a result, the city will continueto see more apartments in uptown, a focus on “smart city,” and growingappeal of urban living. The board started a dialogue on how these economictrends impact upward mobility, affordable housing, and the values of thecity. This dialogue will be on going over the next year.

The council also heard various presentations relating to smart cities,affordable housing, building healthy neighborhoods, workforce development,and creating unity through art. These presentations were presented toprovide a general overview of these topics with the plan for council totake a deeper dive in the monthly strategy sessions.

Courts Weigh in on Redistricting, Elections

While the legislature waits on rulings from the US Supreme Court onlegislative and congressional redistricting, two courts weighed in on otherelections issues this week:

Ethics & Elections Merger

The NC Supreme Court issued a ruling over the weekendstrikingdown a 2017 law that merged the State Board of Elections and the StateEthics Commission. The 4-3 ruling means that control of state and countyelections boards will remain under the control of the party of thegovernor.

Judicial Elections & 2018 Primaries

On Wednesday, US District Court Judge Catherine Eagles issued an order toreinstateprimaries for NC Supreme Court and Court of Appeals races in 2018.Primaries for all judicial races were cancelled by a law passed in 2017.This ruling leaves the cancellation intact for superior and district courtraces. House and Senate Redistricting chairmen Rep. David Lewis (R-Harnett)and Sen. Ralph Hise (R-Mitchell) criticized the decision, calling it“highly partisan.”

Agriculture Awareness Commission Discusses Changes to Current State& Federal Regulations

On Tuesday, the Agriculture and Forestry Awareness Study Commission heldtheir first meeting to receive three presentations on current state andfederal regulations. The committee discussed property tax abatement foraging farm equipment and state and federal regulations for the handling ofproduce.

Back up – property tax abatement?

As directed bySB 615: North Carolina Farm Act of 2017, the Department of Revenue’s Property Tax Section Director Tony Simpsonpresentedon the feasibility of enacting property tax abatement for aging farmmachinery including the potential fiscal impact on local governments andthe state. The Department estimates that an 80% exclusion would result in a$14 million impact on the state. Simpson also noted that existing propertytax form and software programs used by counties would require updates toaccurately gather data.

What about produce?

The committee also received presentations on state and federal producehandling regulations. The Department of Agriculture and Consumer Services’Assistant Commissioner for Agricultural Services Richard Reichpresentedto the committee on the NC Handler’s Act, which was passed in 1941 and lastupdated in 1994, and affects 19 companies. Sen. Brent Jackson (R-Sampson)raised a concern that because the Act only covers produce handlers withwritten contracts, it is not regulating the industry in a uniform way andshould either be updated to cover all handlers, in a similar fashion asneighboring states, or removed from state law.

Disaster Relief Committee Updated on Hurricane Rebuilding Efforts

On Monday, the House Select Committee on Disaster Relief held their secondmeeting of the interim to receive updates from the Golden LEAF Foundationand the NC Housing Finance Agency on efforts to rebuild infrastructuredamaged by hurricanes in 2016.

Tell Me More

First, Golden LEAF Government Relations Liaison Kasey Ginsbergpresentedto the committee ongrantsawarded to local governments by Golden LEAF. To date, the organization hasawarded $174.5 million to 71 projects in 21 counties.

Then, the NC Housing Finance Agency’s Executive Director, Scott Farmer,reportedthat 49 multifamily homes and 381 single family homes are under repair.

Education Finance Reform Committee Receives Feedback from SchoolAdministrators

On Wednesday, the Joint Legislative Task Force on Education Finance Reformmet to hear feedback from local school administrators on the existingschool funding system and recommendations on what changes should be madeand how they should be made.

Any themes?

Overall, presenters requested greater flexibility in managing theirbudgets, more funding for students with disabilities and less of a role indistributing money to area charter schools.

NC School Board Association Government Relations Director Leanne Winneraddressedthe Association’s concerns, including charter school funding. She arguedthat charter schools receive parts of allotments for purposes they may notcover and recommended that school districts and charter schools should be“financially disentangled” at the state and local level. Winner alsoaddressed concerns with special education funding, the use of allotmentsfor teaching positions and low wealth and small schools funding.

To review the remarks and presentations made to the committee, clickhere.

What next?

Lawmakers want to hear from more stakeholders, including charter schools,at a future meeting. NC’s funding model has not been overhauled in decades,and this is likely to be a major topic for several years. The Task Force isset to recommend changes to the legislature in October.

IT Oversight Committee Talks Data Security, Enterprise ResourcePlanning, Health Information Exchange

The Joint Legislative Oversight Committee on Information Technology heldtheir third meeting of the interim yesterday. The committee heard apresentation on data security, updates on the implementation of enterpriseresource planning in state agencies, an update on the implementation of theHealth Information Exchange and industry presentations fromMicrosoftandAdobe.

What about data security?

The Department of Information Technology’s State Chief Information RiskOfficer Maria Thompsonpresentedto the committee on insider threats. According to Thompson, 60-70% ofattacks come from organization insiders, such as contractors and current orformer employees. Most insider attacks stem from employees looking toestablish a second stream of income.

Enterprise Resource Planning Updates

The committee also heard presentations on the implementation of enterpriseresource planning in two state agencies. State Controller Linda Combspresentedon behalf of the Office of the State Controller, and Community CollegeSenior Vice President for Technology Solutions and Distance Learning JimParkerpresentedfor the NC Community College System. Combs and Parker both updated thecommittee on where their individual projects are and funding needed fornext steps.

Health Information Exchange Update

The executive director of the Health Information Exchange Authority,Christie Burris,updatedthe committee on implementation of NC HealthConnex, the state-designatedhealth information exchange. NC HealthConnex is live, with more than 1,200health providers currently connected, and it is expected that 98% of NC’shealth care providers will be connected by June 2020.

A Look Ahead to Next Week

Monday, February 5, 2018

1:00 PM House Select Committee on Strategic Transportation Planning andLong Term Funding Solutions

Tuesday, February 6, 2018

9:00 AM Joint Legislative Oversight Committee on General Government

10:00 AM Child Fatality Task Force – Intentional Death Prevention Committee

10:00 AM Joint Legislative Education Oversight Committee

11:00 AM Permanency Innovation Imitative Oversight Committee

12:30 PM Legislative Research Committee on Intellectual and DevelopmentalDisabilities

1:00 PM Joint Legislative Commission on Energy Policy

Wednesday, February 7, 2018

10:00 AM Joint Legislative Oversight Committee on Unemployment Insurance

1:00 PM House Select Committee on Implementation on Building CodeRegulatory Reform

Thursday, February 8, 2018

1:00 PM Joint Legislative Economic Development and Global EngagementCommittee