August 31, 2015

Legislative Update:  Still no budget from Raleigh


They came, they talked, they went home.

And that pretty much sums up the past week's activities in the General Assembly. The few notable actions that occurred happened on Thursday, the last legislative day of the week, when both chambers passed yet another continuing resolution to keep government operating without an approved state budget in place.

The new deadline for hammering out the current fiscal year's spending is Sept. 18.

The week before, the two chambers reached a compromise when they agreed to cap this fiscal year's budget at $21.7 billion.

WRAL reports that on Thursday, Aug. 27, budget negotiators reached an agreement that all state employees, including teachers will receive a bonus of $750 near the end of the calendar year. That will be paid from the $335 million that is being set aside for salary increases.

Teachers, State Highway Patrol officers, court clerks, and magistrates also will receive the appropriate step increases. Community college employees and hard-to-fill positions also will see a boost in salaries.

House Bill 117, NC Competes, has been assigned to a conference committee to work out differences between the original House bill and the Senate version, which includes the troublesome sales tax redistribution.

The proposed redistribution would allocate 50 percent based on population and 50 percent based on point-of-sale collections. If made into law, the new distribution formula would reduce sales tax coming back to Dare County and the local municipalities by 24 percent.

Under current law, which dictates that 75 percent of the sales tax sent back to local governments is based on point-of-sale and 25 percent on population, Dare County is estimated to receive $19.1 million in the 2016-17 fiscal year. Under the new plan, the amount would be reduced to $14.6 million, which is a $4.6 million cut -- unless the proposal to expand the sales tax base is approved.

An expansion of the sales tax base, adding tax on such things as auto repairs and veterinarian bills, would return some of the lost revenue to counties. With that proposed expansion, estimated sales tax revenues would be $15.1 million which is a $4 million reduction – 21 percent - from projections for the same time frame under current law.

The municipalities also would feel the same percentage of reductions under both scenarios.

Since assigning the bill to conference committee, the conferees have been changed twice.

The Senate has concurred with changes made in the House to Senate Bill 15, Unemployment Insurance Law Changes. The bill, if enacted into law, will mandate that those receiving unemployment benefits must show proof of applying for five positions each week. The bill will be forwarded to the governor next week for his signature.

(Sandy 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.)

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