May 15, 2015
Legislative update: New taxes for fishermen
and new purpose for occupancy taxes
By SANDY SEMANS
surface appeared calm, but there was a definite undercurrent this week
as North Carolina General Assembly House committees began their work on
the state’s 2015-16 fiscal year budget.
A draft budget bill that includes the various committee offerings is
expected to be published online either on the evening of Sunday, May
17, or early on Monday, May 18. The bill will subject to debate and a
final version is expected to be ready to send to the Senate for
confirmation by the end of the week.
If that body does not concur, further changes will be made and then the
budget bill will be sent back to the House. If the House doesn’t agree
with the changes made in the Senate, the bill will then go to
conference committee made up of legislators from both chambers.
If agreement is reached in conference committee, it will then go back
to both chambers for approval, which may or may not be forthcoming. And
then there is the needed approval by the governor, who has his own wish
list, much of which has not yet been included in the draft budget.
In other words, the finish line is getting closer but there could be some stumbles that slow down the process.
But while House members added, deleted, and tweaked what is to become
its version of the budget, on the Senate side, other bills went under
Senate Bill 160,
sponsored by Sen. Bill Cook, R-Beaufort, morphed from five pages when
first introduced on March 3 to 11 pages when it was replaced with a
committee substitute on May 14 while in front of the Senate Finance
The official title of the proposed legislation is “An Act to Provide
for the Dredging and Maintenance of the State’s Waterways in Order to
Enhance Safety and Commerce” and it includes major implications for
act, if passed into law, in part, sets up a program to pay for dredging
shallow-draft channels – those with a maximum of 18-foot depth -- based
on a 50-50 match between state and local governments. Affected Dare
County waterways included in the legislation are Oregon Inlet and
Rodanthe and Rollinson channels. Silver Lake Harbor on Ocracoke also is
Part of Rollinson channel is owned by the federal government and the remainder
of the channel is owned by the state. Combined, the two
separately-owned portions of the channel are called Hatteras Inlet
channel. To include the entire inlet channel that is now impassable and
forcing boats and ferries to use a new, longer route, Dare County
commissioners had requested that the term "Hatteras Inlet" be added to
the legislation but that request was not met.
Because of the severe shoaling in Oregon Inlet, the bill proposes
immediately appropriating $4 million. The funds are to be included in a
transfer of $6 million from the Department of Commerce Job Catalyst
Fund for the 2014-2015 fiscal year, to the Shallow Draft Navigation
Channel Dredging and Lake Maintenance Fund within 10 days of the
effective date of legislation if it becomes law.
The $6 million transfer also is to provide $150,000 to reimburse the
Department of Administration for its costs associated with exploring
options for acquiring Oregon Inlet and the adjacent real property.
And $750,000 is reserved to reimburse the Department of Administration
for its costs associated with prioritizing condemnation of all 15
existing and future transportation corridors on the Outer Banks, “a
right retained by the State and recorded in a deed executed on August
7, 1958, when these lands were conveyed to the federal government.”
In addition, the Department of Environment and Natural Resources is to
receive $250,000 to update the Beach and Inlet Management Plan. The
updated plan is to include a recommended schedule for ongoing inlet
maintenance. No later than Dec. 1, 2016, the department is mandated to
report to the Environmental Review Commission on the updated plan.
If the funds for Oregon Inlet are not spent or encumbered by June 30,
2016, the state funds revert and may be spent for other uses.
In addition to the transfer of funds from the Department of Commerce, a
new vessel registration tax will be used to fund the Shallow Draft
Navigation Channel Dredging and Lake Maintenance Fund. All boats that
are used for recreational or commercial fishing that are at least
24-feet long will be required to pay the tax.
The formula for determining the tax is dividing the length of the boat
– rounded down to the nearest foot – by eight and then multiplying that
number by the length of the boat. A 24-foot vessel would pay $72.
The tax will be required for all boat owners who hold a coastal
recreational fishing license, standard commercial fishing license,
retired standard commercial fishing license, shellfish license,
recreational commercial gear license, or for-hire license.
And then there is the matter of the county’s needed matching funds.
To dredge Oregon Inlet on a year-round basis, the county must match the
state funds. It is estimated that the price tag for the proactive
dredging will be approximately $7 million annually.
The bill includes a provision that the county may use up to $3 million
per fiscal year from the 2 percent occupancy tax currently designated
for beach nourishment until the fiscal year that begins on July 1,
2021. The proposed use of the revenues is designated as “maintenance of
This provision was not at the request of the Dare County Board of
Commissioners. The board had requested a quarter-cent sales tax
designated to be used for matching funds for dredging. Rep. Paul Tine,
U-Dare, sponsored the bill in the House and it was approved in
lightning-swift time and sent to the Senate where Cook refused to push
The bill has not yet been on the floor of the Senate for its second and third readings. That is expected next week.
Semans is a retired newspaper editor and reporter who now works as a
free-lance writer. She lives in Stumpy Point. Her update on the
goings-on in this session of the General Assembly will appear weekly in
The Island Free Press, usually on Friday.)
PREVIOUSLY PUBLISHED 2015 LEGISLATIVE UPDATES
First bill filed would prohibit condemning property for economic development
Legislative Update: And they are off -- sort of
Legislative Update: The gold rush in Raleigh is underway
Legislative Update Most Bills Moving At Snails Pace But One Achieves Warp Speed
Legislative Update: Humor unleashed in the General Assembly
Legislative Update: Lawmakers made hay while the sun was shining
Legislative Update: Bill on dredging causes local turmoil
Legislative Update: 156 new bills filed this week
Legislative Update: Lawmakers keeping busy in Raleigh
Legislative Update: It was raining bills all week
Legislative Update: Occupancy tax provision is out of dredging bill
Legislative Update: Lawmakers take aim at N.C. Constitution
Legislative Update: More taxes and Constitutional amendments proposed
Legislative Update: Lawmakers racing the clock to get bills moved
Legislative Update: Rushing to meet the 'crossover' deadline
Legislative Update: A week of committee work in Raleigh