WHAT HAPPENED: City streets across the U.S. and
other parts of the globe filled with protest over the brutal death of George
Floyd and the broader problem of racial injustice, forcing the conversation
like no other time in recent history.
WHAT IT MEANS: Below in this bulletin is a full
statement from our executive director, Paul Meyer, on what’s happened over the
past week and what it means for us. Diversity is the strongest attribute of
cities and towns, he says, and at its core the League’s mission is to fight for
fair, equal opportunity for our 540 municipalities and their communities.
ON TAP: The protests, and the ongoing COVID-19
pandemic, will continue pushing new dialogue on how we can build a stronger
society.
THE SKINNY: There’s nothing more prominent in
the headlines. But we do cover other news relevant to cities and towns in this
Bulletin, from the latest at the General Assembly, to the immediate need for
Congress to appropriate direct relief funds for cities and towns as COVID-19
continues its financial impact, what we can expect in Powell Bill funding, and
a look at part-two of CityVision 2020, a virtual summit of North Carolina
cities and towns.
The following message was first issued on June 2:
Dear League members,
I am writing to you during an immensely difficult time for our
communities, our towns, our state and our country.
I will begin by highlighting perhaps our greatest attribute:
diversity. We see its value across North Carolina every day. Our cities and
towns have many differences. They are large and small, urban and rural,
mountainous and coastal and agricultural. They are comprised of citizens of all
races, ages and backgrounds. And it is because of—not in spite of—these
differences that we thrive, both culturally and economically. At its core, the
League’s mission is to fight for fair, equal opportunity for our 540 towns and
their communities.
The crisis facing both our state and the country strikes at this
very principle. Injustice and oppression run directly counter to our mission.
They stand as obstacles to the goals we strive for. There is no more egregious
example than the death of George Floyd. We condemn this act of brutality, and
we stand firmly against all acts of racism.
This moment is one of rebuilding. Already, we faced the steep task
of recovering from a global pandemic and the resulting financial disaster. Now,
we face urgent efforts on several additional fronts. For our cities that have
experienced escalatory demonstrations, we must repair main streets and
downtowns and stand proudly as the economic engines of our state. For our
police forces, we must restore community trust; we must develop relationships
free of aggression and animosity. And in our rebuilding, we must not just
return to the old status quo, but to a better, more equitable state of affairs
for all peoples, all communities and all towns.
The League, through its law enforcement trainings and
ever-expanding collection of resources, is uniquely prepared to further these
efforts. They are our top priority.
The challenges of local leadership, while seldom easy, are rarely
more difficult than they are right now. And yet, having seen firsthand the
capacity and talent of our local officials, I am certain that we will move
forward. I am certain that we will emerge from this moment stronger than
before.
The League stands ready to assist in any way possible.
Thank you,
Paul Meyer, NCLM Executive
Director
As
COVID-19 continues to impact the municipal government coffers that fuel
important daily services and minimize property taxes for the majority of North
Carolinians, Congress should appropriate direct relief funds now, NCLM
Executive Director Paul Meyer says
in this brief,
sharable video message. Because action is needed to avoid a
prolonged recession, please contact your members of Congress.
League
members continue their campaign for funding along with the National League of
Cities’ “
Cities Are
Essential” campaign (link) to help replace lost sales tax, occupancy
tax and utility revenue caused by the COVID-19 virus. Mayor Bob Scott of
Franklin shared the need in an
op-ed published
by the Asheville Citizen-Times this week. "Local governments
and their financial health are crucial to economic recovery, and it is not just
because we act as major employers," Mayor Scott said.
As
NCLM’s campaign continues with its focus on both securing new and direct
funding from Congress and encouraging state legislators to share federal
funding already received, it is important to emphasize that cities and towns
are the economic engines of the state. And, as was shown after the Great
Recession in 2008, the longer cities go without revenue help, the longer the
recession will continue for the state. Cities and towns build infrastructure
that keeps business and jobs flowing. They bring in 75 percent of sales tax to
the state, but receive only a third of the local sales tax revenues they
generate.
Read more from
this flyer on the topic.
Last
week, municipal leaders from around the state heard from U.S. Senator Thom
Tillis and shared with him why cities need additional revenue at a virtual
meeting organized by the League. To date, no direct funds have gone to
cities, except for the city of Charlotte. On Thursday, city leaders heard
from and shared concerns with U.S. Rep. Greg Murphy at a forum assembled by the
League (with more to come). Meanwhile, city leaders are speaking with their
state legislators about the need for revenue with hope that the General
Assembly directly allocates recently received federal relief dollars to cities
and towns. In the coming days and weeks, look for more North Carolina municipal
voices making this case on a variety fronts.
Register
now for Part 2 of CityVision Virtual Summit, June 16-18. Don’t wait – TODAY is the last day to
register and still receive your mailed CityVision swag bag and conference
packet for this FREE event.
We
have convened a three-day lineup of live sessions featuring state government
officials, industry leaders and on-demand sessions to help municipalities move
forward. The conference agenda includes engaging and relevant sessions from:
- Josh Stein, N.C. Attorney
General, N.C. Department of Justice
- Mike Sprayberry, Director, N.C.
Emergency Management
- Tracy Doaks, Director, N.C.
Department of Information Technology
- Michael Walden, Professor and
Economist, NCSU
- James H. Johnson Jr., UNC Kenan
Flagler Business School
- Pete Seeber, Chief Strategy and
Risk Officer, CORVID Cyberdefense
- Donald Gintzig, President and
CEO, WakeMed Health & Hospitals
- And more!
Register here.
The
House Appropriations Committee considered individual funding bills this week,
including a top priority of cities and towns.
HB 1087
Water/Wastewater Public Enterprise Reform would provide $9 million
in non-recurring state funds to create a new grant program – the Viable Utility
Reserve – that supports financially distressed public water and wastewater
systems by facilitating viable operations and encouraging regionalization.
The bill
language was result of a yearlong legislative study and stakeholder process
that focused on
the more than $17 billion in water and sewer infrastructure needs
statewide and also includes a study of the feasibility of
authorizing historical charters for units of local government. Senate
Appropriations chairs have shown support of the same bill language by
introducing
SB 810
Water/Wastewater Public Enterprise Reform; however, they have not
listed an appropriation amount.
League
Board President Jennifer Robinson sent letters to both
House
and
Senate
sponsors thanking them for their support of the Viable Utility Reserve. The
letters highlighted that declining populations and manufacturing losses have
dealt huge blows to many rural municipalities and their utility systems and
noted that the new grant program is critical to addressing utilities that may
be at risk of financial collapse.
The League thanks
Rep. Chuck
McGrady and
Sen. Paul Newton
for their leadership during the legislative study committee and stakeholder
process. HB 1087, which provides for the Viable Utility Reserve and was
filed by primary sponsor
Rep. Donny
Lambeth and 14 co-sponsors, was approved by the House Appropriations
Committee and will likely receive a floor vote early next week.
League
Executive Director of Public & Government Affairs Rose Vaughn Williams moderated
a panel this week assembled by the N.C. Rural Center on water and wastewater
infrastructure issues. Part of the Rural Center’s “Rural Talk” virtual advocacy
series, the panel included Bethel Mayor and N.C. Mayors Association Chair
Gloristine Brown along with state Division of Water Infrastructure Director Kim
Colson and Sharon Edmundson, director of the fiscal management section of the
State and Local Government Finance Division of the N.C. Department of State
Treasurer.
Discussion
highlighted problems that rural systems faced after mills and manufacturing
operations vacated those parts of North Carolina, worsening substantial
population declines there, leaving far too few customers to support the
systems. “Many of these systems, too, were created when there was more public
grant funding available than there is today – or will be available in the
future,” notes a
fact sheet from
the Rural Center on the event.
Panelists
talked regionalization, mergers with other systems, and planning for the
longterm instead of counting on short term stopgaps.
Sen. Don Davis
of Pitt County (and former mayor of Snow Hill) and
Rep. Chuck
McGrady of Henderson County gave updates on what the General
Assembly is doing to help. Rep. McGrady had co-chaired the study committee that
resulted in the Viable Utility Reserve legislation.
The
Powell Bill Unit of the N.C. Department of Transportation (NCDOT) recently
notified the League that the state’s appropriation to the Powell Bill program
is currently projected to decline by almost $4.4 million for fiscal year
2020-21. The $4.4 million reduction to the $147.5 million appropriation to all
cities eligible for the Powell Bill leaves $143.1 million to be distributed and
represents a 3 percent drop in Powell Bill funds. There is also still scheduled
to be $7.375 million in additional Powell Bill funds distributed to all cities
eligible for the program with a population under 200,000. The reduction in
funds is tied to the passage last year of
S.L. 2019-251,
which states in part: “In any fiscal year, when all funds allocated for snow
and ice removal, and emergencies are depleted, the Department may, in
coordination with the Office of State Budget and Management (OSBM), reduce the
budget for every departmental division, grant-in-aid, and category of expenditures…”
However, all these numbers
are pending based on decisions that must be made regarding the NCDOT budget for
next year. As previously
noted in this Bulletin, financial issues at NCDOT exacerbated by the COVID-19
pandemic have left the agency with a significant revenue shortfall. NCDOT
previously indicated to the League that this could lead to across the board
cuts of 15 to 25 percent that would include the Powell Bill program. It remains
to be seen how the General Assembly will choose to address this shortfall and
whether any federal funds will be made available and sufficiently flexible to
help fill this gap. The League will continue to be involved in these
discussions and keep you informed as to the status of the NCDOT budget and the
Powell Bill program.
Results
of the May Budget & COVID-19 survey conducted by the League and the
N.C. Local
Government Budget Association are now available on the League’s
website. They can be accessed
here,
along with results from a similar survey conducted in April. The survey
includes data on planned merit and COLA increases for the coming fiscal year
and are intended to serve as a way for League members to compare their budget
preparation plans with peer governments. The League thanks all of the local
officials who took the time to participate in the survey as well as NCLGBA for
its continued partnership.
Two
bills moved in the House this week that would make technical and administrative
changes to statutes governing state-administered pension systems.
- SB 379
Retirement Systems Admin Changes makes pension system changes
to promote financial accountability and integrity, including changes to
credible service purchase provisions and allowing the Treasurer’s Office
to require an employing agency pay a portion of a return to work
overpayment if the employer partially caused the overpayment.
SB 719 Retirement
Tech./Protect./& Other Changes makes minor changes to the
pension systems, including defining what constitutes an inactive employer.
