WHAT HAPPENED: Last week, we quoted legislative
leaders eyeing adjournment of the 2020 session by today -- but no guarantees.
Indeed, the lights remain on. Lawmakers plan to hold skeletal sessions until
July 11, runway for matters that might come up in the coming days, like vetoes
of bills they’ve sent the governor. An adjournment resolution also looks to a
September session.
WHAT IT MEANS: Because the General Assembly
desired a wrapup of priority business this week, the chambers packed in a lot,
holding session until the early morning hours, not unusual for these scenarios.
The League is analyzing legislation of interest to cities and towns and will
inform members when that is substantiated. But among important approvals was a
bill, which we’ve fleshed out below in this Bulletin, to guarantee
municipalities 25 percent of the $300 million set aside in CARES Act dollars
for local governments.
ON TAP: A
resolution
approved by the House and Senate would put them into adjournment until Sept. 2
-- no sine die expected before then. At that time, they could consider bills
regarding federal funds the state has received regarding COVID-19 response.
THE
SKINNY: As
the General Assembly took action benefiting municipalities when it comes to
sharing of CARES Act funding, NCLM and the National League Cities continued
efforts to gain congressional support for additional and direct funding to address
tax and utility revenue shortfalls caused by the pandemic. That campaign
remains alive and at media attention. Read on for updates on that and more news
for municipalities from a very busy week.
As
the legislative session rolled to a temporary conclusion, state lawmakers
approved a bill that will guarantee that municipalities receive 25 percent of
the $300 million set aside in CARES Act dollars for local governments. Approval
of
HB 1023
Coronavirus Relief Funds/Additions and Revisions came after
legislators had previously sent $150 million of the $300 million to county
governments with language that encouraged them share money with municipalities
but did not require it. Reports to the state indicated that about 25 percent of
counties had not agreed to share any of those dollars with municipalities within
their borders. HB 1023 does not set out any parameters for how counties must
share those federal dollars, but will require that 25 percent be shared with
cities and towns, meaning a total $75 million will be guaranteed for that
purpose.
The
legislative action followed meetings between NCLM leadership and House Speaker
Tim Moore this week and Senate leader Phil Berger last week. While CARES Act
dollars have, to date, been restricted to direct COVID-19-related expenses, it
is important to know that U.S. Treasury guidance has loosened some restrictions
that likely affect municipal governments, particularly as it affects spending
on law enforcement and other public safety salaries. Guidance released this
week also included the use of those dollars, in some instances, for matching
money for FEMA relief. The U.S. Treasury Department has currently pulled some
of that guidance from its website, but as it updates and adds to it, that
information can be found here. The N.C. Pandemic
Recovery Office is also assisting local governments in determining
eligible expenses. You can find further information about reimbursement of
first responder salaries on page 5 of this document
from the state office.
As
the General Assembly took action benefiting municipalities when it comes to
sharing of CARES Act funding, NCLM and the National League Cities continued
efforts to gain congressional support for additional and direct funding to
address tax and utility revenue shortfalls caused by the pandemic. Over the
weekend,
this op-ed
appeared in the Greensboro News & Record making the case for the needs of
cities and towns in the wake of the disruption of economic activity due to
COVID-19. The opinion piece -- from Mayors Neville Hall of Eden, Jay Donecker
of Reidsville and David Myers of Madison – notes the uncertainty facing
municipal governments as they attempt to move forward. “In the upcoming fiscal
year, our municipalities may reduce investments in infrastructure to try to
plan for this uncertainty. That will mean economic development projects delayed
or lost. Planning for future projects will likely be approached cautiously to
be fiscally responsible and ensure that funding is adequate for critical
services like public safety,” the mayors write. “Meanwhile, if cuts to services
like recreation and senior care occur, our citizens’ physical, social, and
economic well-being will be hurt.”
This op-ed from
Oxford Mayor Jackie Sergent made a similar case, noting that,
“Cities and towns face this crisis with control over only one primary source of
revenue — property taxes …But the last thing that local governments need to be
doing now is increasing property taxes and passing along revenue shortfalls to
residents and business owners who are struggling to make mortgage or rent
payments. That would be not only cruel and akin to trying to squeeze blood from
a turnip, but ultimately economically self-defeating. We need to be a resource
for our constituents.” Meanwhile,
mayors across the
state continued organized letter-writing to congressional representatives
letting them know of the financial issues that they face.
In
Washington, Congress was preparing for a summer break amid speculation that it
might take up a new round of federal relief – which could include direct
assistance to municipalities – in late July. NLC released
survey results
showing that many municipalities across the country are preparing to delay
infrastructure projects as a result of pandemic-caused revenue shortfalls.
Advocacy materials showing those results can be found
here
and
here.
Also, the League has created a resource page where you can find N.C.-focused
materials to make the case for revenue replacement, as well as news coverage,
at
y2qetf65.marianneangelirodriguez.com/covidfunding.
Let’s keep making that case so that municipalities can continue to help drive
economic recovery!
Sales
tax revenues from sales in the month of April were down more than $40 million
statewide across all local governments, according to data shared by the
Department of Revenue this morning. Taking into account declines in March
revenues as well, local government sales tax revenues for March and April are
$65 million below the same months in 2019. Analysis of sales tax and other key
revenues from the third quarter of the current fiscal year is now available in
the League’s latest quarterly Revenue Report . An interactive version allowing
you to drill down on the available data
can be found here,
and
a PDF report is
available here. All of the League’s revenue-related information
can always be
found here. This report generally covers the first quarter of the
calendar year (which is the third quarter of the local government fiscal
year), and for sales taxes is based on sales made in January, February, and
March. Check back with the interactive version of the report next week, as we
plan to incorporate April’s data to bring you the most up to date analysis of
this major revenue source.
Face
coverings are now a requirement in public places, statewide, in an effort from
the governor’s team to decrease the spread of respiratory droplets and risk of
COVID-19. Gov. Roy Cooper this week announced a new executive order,
EO 147,
extending the current Safer at Home phase of public restrictions through 5 p.m.
July 17, with his team pointing to data showing that the coronavirus numbers
are far too worrying to relax policy. The new executive order, issued on Wednesday,
“strongly recommends” two years of age as the starting point for
mask-wearing.
In
the same general conversation, the governor last week
vetoed
a bill from the General Assembly to reopen gyms and bars. The General Assembly
subsequently held a vote to override the veto this week,
but it failed.
Legislators followed up with additional reopening bills.
A
press release from Governor Cooper’s team on the new executive order details
the public health data points they’ve worked with in their decision making. It
also quotes individuals from the healthcare field. “As the leader of the
state’s largest health system, I am pro-health and also 100 percent
pro-business. In fact, the two are inextricably connected and I’m very proud of
the way business leaders and health experts are working together to keep our
economy strong,” the release quotes of Eugene A. Woods, president and CEO of
Atrium Health. “Medical science says to reduce the spread of COVID-19 masking
works, and my sincere hope is that all the people of North Carolina can join
forces to make wearing a mask not something we feel we have to do – but
something that we want to do to keep each other, our neighbors, our children
and our loved ones healthy and safe.”
The
state has released a
FAQ document
to help with the fine points of EO 147.
Lumberton
Council Member Owen Thomas, a member of the League’s Board of Directors, has
received an appointment to the
North Carolina
Housing Partnership. The appointment from Senate leader Phil Berger
follows a recommendation from League Executive Director Paul Meyer. The
Partnership carries out the business of the N.C. Housing Trust Fund, which is
appropriated by the General Assembly and is the largest financing source for
supportive housing and necessary improvements. The 13-member body includes the
state’s commerce secretary and state treasurer. The General Assembly appoints
most members, including one reserved for the League. Jacksonville Mayor Pro Tem
Michael Lazzara, a past League president, previously served on the Partnership.
