2010 Short Session General Assembly Highlights

1. 2010 Short Session General Assembly Highlights Presentation to Board of Commissioners August 16, 2010

2. Review of Catawba County Legislative Goals

3. Guide to Symbols Catawba County Legislative Goal North Carolina Association of County Commissioners Legislative Goal Goal was fully met during the Short Session Goal was partially met during the Short Session Goal was not met during the Short Session

4. Support an increase to $35,000 in the Homestead Exclusion income limit • Several bills were introduced to increase the income limit during the 2009 Long Session. One bill, House Bill 396, made it out of a Committee during the 2009 Long Session and was referred to another House Committee. Unfortunately the bill never surfaced again. • Support a fairer distribution method in the School Capital Fund Formula/Lottery Proceeds • While $63 million in school capital lottery funds were redirected to • backfill state budget cuts in classroom teachers and university scholarships, $113.7 million in remaining lottery funds were appropriated on a per pupil basis, disregarding a county’s • effective tax rate, which will actually result in Catawba County gaining $449,122 in lottery funds. • Oppose transferring the responsibility of North Carolina’s secondary road infrastructure to counties - the elimination or decrease in current road infrastructure funding levels for municipalities or the transfer of any State maintained roads to municipalities • No attempts to transfer roads were undertaken in the Short Session.

5. Oppose any State efforts to force additional unfunded mandates or take away local revenues as a result of State budget crisis • More detail is given in the “State Budget” portion of this presentation. • Oppose attempts to eliminate the prohibition on collective bargaining for public employees • No attempts were made at the State level to eliminate the prohibition on collective bargaining.

6. Support greater flexibility in the use of E-911 funds House Bill 1691 was passed unanimously by the General Assembly and has impacts in five areas: Funding flexibility: Funds may now be used on any capital need located within the 911 center’s building. Standards: The State 911 Board is directed to develop statewide minimum 911 center standards. New funding formula: The 911 Board is directed to develop a new funding formula for all primary Public Safety Answering Points (PSAPs). One-time use of 911 fund balance: Counties may use 50 percent of their current 911 fund balance on any public safety need Board – The legislation takes one seat on the State’s 911 Board away from telecommunications companies and gives it to local governments to provide parity on the Board. Oppose attempts to reduce the property tax base, and place more of a burden on property taxpayers No bills were passed during the session affecting property tax base.

7. Support an increase in State funding for Child Advocacy Centers No increase, but an attempt to reduce funding was initiated with the Governor’s budget. Fortunately, when the final budget was adopted this decreases was removed. Support a rate increase for Medicaid and State mental health services No rate increases for any services were granted. The County will most likely see a rate reduction sometime in October/November, but the amount is still unclear. Support flexible local revenue options to avoid future property tax increases or reduce the property tax rate No legislative action was taken on this issue, but 911 funds were made more flexible, which lessens the burden on property taxes for this service. Support legislation facilitating target industry sectors and encouraging the County’s competitiveness as a whole House Bill 1973 – Various Economic Incentives and Senate Bill 1171 – Keeping NC Competitive Act were passed during the Short Session. There was not much headway made on the specific goal of getting the NC Rural Center to consider very high unemployment as a condition for access to their funds.

8. Support an increase in the $40 reimbursement rate for state inmates in county jails and reinstatement of the $18 misdemeanant reimbursement No legislative action was taken on this issue Support an exemption of State sales tax on purchases made by local school systems No legislative action was taken on this issue Support an increase in the reimbursement rate for local government legal work related to in rem foreclosures No legislative action was taken on this issue

9. Support maintaining local control of the North Carolina ABC System and preservation of local revenues received from the system House Bill 1717 was adopted during the Long Session and it makes changes in the ABC system. Although the Bill, when first written, took away local control and local revenues, through the debate process, appropriate amendments were made to restore control and revenues. Work with the North Carolina Association of County Commissioners Regarding Local Preferences in Purchasing We have requested that the NCACC look at this issue, but no legislative action took place. Support local legislation to allow Catawba County flexibility with energy efficient projects House Bill 1814, a local bill for Catawba County, was adopted by the General Assembly during the Short Session and gives the County flexibility in purchasing energy efficient equipment and flexibility in leasing property related to energy efficient projects. This legislation will help as the County’s EcoComplex is developed.

10. Other legislative issues that were considered during Short Session

11. State Budget • PUBLIC SAFETY RELATED • JCPC – 5% across the board funding reduction to all funded programs or $17,493. - - Corner House I & II – $8,683 • - Family NET – $3,256 • - JCPC Administration – $750 • - Conflict Resolution Center – $1,077 • - Parenting Network – $1,332 • - Project Challenge – $2,395

12. State Budget • SOCIAL SERVICES - overall projected loss between $70,000 and $115,000 • - Smart Start reduced by 2.5% ($20,000). • - Adult Care Home Case Management (ACHCM) reduced by $9,300 locally. • - State support of a Adult Home Specialist position by 15% or $3,000. • - Allocation reductions that occurred in Fiscal Year 2009-10 totaling $64,000 • - Mental Health Enhanced Services reduced by $41 Million at the State level, unknown local impact at this time. • - Personal Care Service (PCS) reform reduced by $51 Million on the State level, unknown local impact at this time. • - Funding for Child Advocacy Centers was proposed to be cut in Governors Budget but was restored. • - $481 Million loss in total State Medicaid funding (will cause cuts in other areas or cuts during the year). • - $1.4 Million loss in total State Child Welfare – Foster Care/Adoptions funding -$20,000 reduction locally. • Some programs within N.C. Health Choice received a 2% increase to match a 2% increase in those eligible for this service. • Restored Day Care Administration to 5% (4% in Fiscal Year 2008-09), which maintains funding at the current level $55,000.

13. State Budget • PUBLIC HEALTH • - State grant for Environmental Health was reduced by $4,000 from $6,000 to $2,000. • - There is the potential for a 1% across the board cut to state agencies if funding planned from the Federal budget is not received. If state funding to Public Health was cut by 1%, it would equate to approximately $16,000.  • LIBRARY • - State Aid to Libraries was not reduced in the State budget. As a consequence of the potential 1% reduction to state agencies if planned federal funding is not received, the Department of Cultural Resources will implement a 2.5% reduction in funding. The amount of the total reduction in State Aid is approximately $388,000 but the specific amount of State Aid that Catawba County will receive will not be known until after all libraries report on their Maintenance of Effort in late August. 

14. State Budget • SCHOOLS • - ADM – The budget continues to divert the corporate income tax from the school capital building fund resulting in a loss of roughly $1.3 million. • - Lottery – The budget diverted $63 million in lottery proceeds and allows counties to use lottery proceeds at the request of school districts to supplement current expense funding. Thanks to a formula change from effective tax rate to per pupil, Catawba County actually gained $449,122. • - CVCC – Flexibility cuts 3% • Hold back for possible reversions 4% (1% of this is due to the potential across the board cut tied to the Federal budget.) • Prison reduction 40% of funding for classes outside of Basic Skills classes and amount to be determined by early August. • Funding for high school programs have changed for general ed. classes (sociology, art, history, drama, etc.). Funding for these programs will be eliminated. • - Catawba County Schools – $3,557,947 in discretionary reductions. • - Hickory Public Schools – $916,594 in discretionary reductions. Additionally they were cut $121,466 for the funding formula for NC Virtual Public Schools. • - Newton-Conover Schools – $602,251 in discretionary reductions.

15. State Budget • SOLID WASTE • - $2.5 million is diverted from the Scrap Tire Disposal Account. There is the potential of a loss in Fiscal Year 2010/11 of $80,000 that was budgeted from scrap tire grants. • - $1.2 million is diverted from the White Goods Management Account. No funds were budgeted from white goods capital improvements in Fiscal Year 2010/11. • GENERAL REVENUE • - Beer & Wine Tax – Funds were fully restored but we only budgeted $107,250. In FY 08/09, we received $366,585.

16. Ethics Changes in the State Ethics Law were made in the last days of the session. Public Record Acts Behind closed doors, in the last few hours of the session, changes were made to the Public Records Act regarding personnel records. As of October 1, 2010 Information about each promotion, demotion, transfer, suspension, separation or other change in position will now be a matter of public record. Additionally, the written notice of the final decision of the county to dismiss an employee, along with specific acts or omissions that are the basis of the dismissal, will be a matter of public record. Local Government Liaison The changes also create a new classification of lobbyist, the local government liaison. A county employee whose principal duties – in practice or set forth in their job description – include lobbying for legislation action. These liaisons will now have to register with the Secretary of State under the State’s lobbying statute.

17. Appendix

18. Catawba County tracks legislation and communicates our position on issues in multiple ways One Commissioner acts as a liaison with one member of the local General Assembly delegation to ensure consistency and develop effective relationships. Assistant County Manager oversees legislative process, monitors legislative items and develops recommended legislative agenda and strategy. The UNC School of Government’s Daily Bulletin provides information on the progress of specific bills after each legislative day. Legislative updates are provided via the County’s Legislative Blog, through Twitter and by email communications. The North Carolina Association of County Commissioners advocates for all North Carolina counties. Catawba County notifies the Association of items that are important and uses legislative updates from the Association to track legislation. The Association uses tools like weekly bulletins, email alerts and weekly conference calls to keep counties up-to-date. When there is alignment in goals we strive to not duplicate efforts in order to be more effective. Catawba County partners with the City of Hickory for lobbyist services from the firm of Womble, Carlyle, Sandridge and Rice. Jack Cozort is the primary contact point and provides the majority of lobbying services for the County and City.

19. Facts Short Session convened on May 12, 2010 and adjourned on July 10, 2010 2011 Long Session will convene on January 26, 2011

20. Study Committees • There are a number of Study Committees that are of interest. Listed below are some of the study committees which are related to Catawba County legislative goals or could have some impact on the County. • Ownerless Dogs and Cats, Commercial Dog Breeding (S.B. 1332 – McKissick, Jones; S.B. 460 – Davis; H.B. 208 – Harrison, Wray, Cotham, Carney) – The Commission may study issues related to ownerless dogs and cats, and the State's role in ensuring the humane treatment of dogs and cats by breeders, shelters, and other facilities that house dogs and cats. • Broadband-Smart Grid (S.B.1440 – Queen) – The Commission may study public and private telecommunications issues.

21. Study Committees • Local Cable Service Franchise Agreements (Fisher) – The Committee may study the issue of whether and to what extent cable service providers, who entered into local cable service franchise agreements with local governments, and their successors in interest, should be required to continue, maintain and operate institutional networks and electronic transmission facilities pursuant to the terms and conditions of the local franchise agreement as a condition of holding a State cable service franchise. • Local Government Owned and Operated Communication Systems – The Committee may continue its study begun in 2009 of local government owned and operated communication systems. • Blue Ribbon Task Force to study the impacts of raising the compulsory public school attendance age prior to completion of a high school diploma from 16 to 17 or 18. • Joint Select Committee to Study the Adoption of Comparative Negligence and Abrogation of Joint and Several Liability.

22. Items to be on the look-out for during the Long Session • Session will convene on January 26, 2011 • State Budget – estimates now have potential State budget deficit at $3 million • Transportation • Discussions about DOT, toll roads, and ROLE OF COUNTIES IN ROADS. • Lottery Formula/School funding formulas • Municipal Annexation • Mental Health • Collective Bargaining • Criminal Justice/Prisons • What will come out of the studies bill? • Tax policy