NCACC District MeetingRandolph County

April 3, 2013

‘STAYING CONNECTED’

2013 General AssemblyWhere are we now?

David F. Thompson,

Executive Director

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Where are we now - leadership

Sen. Phil BergerSenate President Pro Tem

Republican

Rep. Thom TillisSpeaker of the House

Republican

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GovernorPat McCrory

Republican

First time since 1896 election Republicans have held Governorship and

both chambers

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Number House Senate

Republicans 77 33

Democrats 43 17

No. needed to override veto 72 30

1st term members 44 12

2nd term members 28 16

Last time Republicans in majority 2010 1898

Where are we now – General Assembly

Where are we now – General Assembly

605 – number of years of Legislative experience lost

8 – number of current/former County Commissioners who won seats

1 in Senate

7 in House

26 – Former county commissioners in the General Assembly

Where are we now – counties

580 – County Commissioners

303 – Republican County Commissioners

271 – Democrat County Commissioners

6 – Unaffiliated County Commissioners

121 – New Commissioners

53 – Republican majority boards

45 – Democrat majority boards

2 – no majority

Where are we now – Counties

• 60 legislative goals adopted by membership– 12 defense (stopping something bad from happening)– 48 offense (advocating for something good)

• Bills have been filed to further 17 of 48 NCACC offensive goals

• Other goals being addressed via administrative fixes• Defensive goals not advancing at this time – save

lottery

Where are we now – Competition/Complexity

• 818 advocates• 868 Lobbyist Principals• 170 legislators• 1,075 bills introduced through April 2• 213 bills being tracked by NCACC (20%)• 580 commissioners• 100 counties

Where We Are Now – Key dates

• Local bill filing deadlines have passed• Senate bill filing deadlines have passed• House public bill filing deadline is April 4• Crossover deadline is May 16• Senate expected to pass budget by mid-April• House expected to pass budget by mid-May• Budget to be finished by early June• Session to adjourn by late June

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We need you …

We need you …• To stay focused on goals and key issues• To educate new legislators on the role of county

government• To continue to be the best advocates for county

government in North Carolina• To come to Raleigh

– Walk the Hall Wednesdays– County Assembly Day

Governor McCrory’s Proposed Budget

Governor’s InitiativesEconomy, education, and efficiency• $20.6 billion, $400 million higher than 2012-13

– Most state agencies at 1-3% cut– 1% pay raise & 1% retiree COLA

• Focus on economy– Nearly doubling of state rainy day fund– Additional funding for state repairs and renovations– Reserves for Medicaid, IT, disaster relief

• Focus on shoring up Medicaid and cost overruns

Governor’s InitiativesEconomy, education, and efficiency• Focus on efficiency

– Closes poorly visited historic sites & dilapidated prisons– Sweeps up off-budget revenues including Golden Leaf,

Parks & Recreation Trust Fund, scrap tire, white goods– Creates NCGEAR—government efficiency & reform

• Focus on education– Digital learning– Pre-K– Partially restores textbook cuts & instructional supplies– Eliminates teachers assistants in grades 2-3

• No new initiatives outside digital learning

Revenue/Spending Picture• Medicaid cost overruns….again• State revenues slightly above target

– Except sales taxes• Modest revenue growth of 3.6%

– Historical above 5%– Sales at 3%

• State agencies asked to tighten belts– $225 million overcollections/reversions

Budget Impacts to CountiesGood….• County legislative goals included• No shift of state responsibilities to counties• Minimum cuts to county programs

Bad….• No restored lottery funding• Permanent take of corporate tax set aside for

school construction• No restored community mental health funding

Budget Impacts to CountiesNCACC Goals

• Restores drug courts• Increases state crime lab funds• Increases funding for Justice Reinvestment,

including additional probation & parole officers• Provides state funding to draw down $4 million in

federal HAVA• Increases commitments to community college

workforce investments• Increases Pre-K funding slots by 5000 but…

– Uses county lottery dollars for funding

County School Construction Funding

• Permanently redirects corporate income tax set aside for county ADM school construction to state general fund– Estimated loss of $75 million per year

County School Construction Funding

• Restricts county school construction lottery funds at $100 million recessionary levels– Counties due $180 million (40% of net

proceeds)– Proposal keeps 2012-13 excess for digital

learning– Proposal dedicates county lottery dollars to

digital learning & pre-K

• Prizes >= 50% of total annual revenues• Education funding >= 35%

– 50% = Early grades class size reduction & academic pre-k programs for at‑risk four‑year‑olds

– 40% = school construction & school debt service – 10% = college and university scholarships

• Lottery retailers <= 7% of ticket face value• Lottery admin <= 8%

– If <8%, increase prize payments or public purposes– Advertising <=1%

• Unclaimed prize money = 50% to enhance prizes & 50% education funding

Lottery Dollars—Where Funding Should Go

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Lottery Dollars—Where Funding Is Going

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PurposeStatutory

% & $Actual % & $ 2013 Budget

Early grades class size reduction & academic pre-k programs for at‑risk four‑year‑olds

50%; $221M

64.3%;$284M

School construction & school debt service 40%: $176M

22.7%;$100M

College and university scholarships10%; $44M

9.3%; $41 M +

all excess 2012 revenues = $26M

LEA funding to offset budget reductions 0%3.7%; $16 M

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County School Capital Funding LossesLottery/Corporate Income Tax Appropriations since

2009-10 (in millions)

YearLottery $

rec. 40% dueLottery Loss ADM loss Total loss

2009-10 $147.2 $147.2 $0.0 $60.5 $60.5

2010-11 $113.7 $176.5 $62.8 $64.5 $127.3

2011-12 $100.0 $170.0 $70.0 $72.1 $142.1

2012-13 $100.0 $176.5 $76.5 $74.8 $151.3

2013-14 $100.0 $180.0 $80.0 $75.0 $155.0

Totals $560.9 $850.2 $289.3 $346.9 $636.2

Next Steps on Budget• Joint approps meeting to understand

proposal– Talk of keeping House and Senate together

for consensus proposal• Senate leads first in 2013-15 biennium

– Anticipated budget mid to late April• House receives Senate proposal

– Anticipated budget mid-May• Consensus to finalize by early June

Our Next Steps on Budget

• Alerted counties to inadequate lottery funding• Alerted counties to overall impacts• Meeting with county caucus to discuss county

priorities• Meeting with Senate approps chairs to discuss

county priorities• Need you to discuss county priorities—focus

on lottery funding

County Legislative Hot Topics

County Inmate Medical Cost Containment

• S321 sponsored by Sens. Jim Davis (County Caucus co-chair), Buck Newton & Thom Goolsby (JPS Approps co-chairs)– House companion H448 per Cumberland Co. legislative

meeting

• Provide parity with state prison medical cost containment initiatives– Payments to providers limited to 70% of prevailing charges

or twice Medicaid rate– Enables counties to pay Medicaid rates for in-patient

medical care• Counties to fund non-federal share of cost

Tax Reform• Awaiting Senate/House plans for tax reform

– Governor to propose changes to personal & corporate tax in concert with legislative proposals

• S363 to revamp franchise & privilege license taxes– Replaces with revamped franchise tax– Repeals municipal authority to levy franchise &

privilege license taxes• S394 to revamp franchise, privilege, expand sales

tax base, reduce corporate & income– Assessing county impacts

Public Records Issues

• S125 (Public Meetings/Records Law Violations)– Makes it a misdemeanor to withhold a public record

• S331 (Sunshine Amendment)– Put open government in state constitution

• S332 (Government Transparency Act)– Requires counties to disclose personnel performance

files on each employee & general description of actions

Goal Updates• Electronic public notice

– Bills in House and Senate• Motor vehicle property tax collection

– Implementation of new system in May• Expand use of 911 funds

– Bills to study system, re-work board

Goal Updates• County to have option to own and

construct school sites and facilities– Senate bill accomplishes this goal

• Local control of school calendar– Numerous local bills and 1 statewide bill

• Extend sales tax hold harmless– Bills in House and Senate

Walk the Hall Wednesdays

• Sign up on NCACC Website• Contact Alissa Willett

• First Come First Serve – Limited to 2 Counties per Wednesday

• Chance to Visit your Delegation, Attend Legislative Committees

• Prepare to be Flexible• Wear Comfortable shoes!

County Assembly DayWednesday, May 22, Raleigh