2017 Legislative Session Final Report

The NC General Assembly adjourned its 2017 long session in the early morning hours of June 30, but did so with a stated intent to return well before the typical May start of its short session. Counties had a productive session, making great progress in their years-long effort to increase lottery funds dedicated to school capital needs. Multiple other NCACC goals passed in the 2017 budget act; many more made partial progress and are eligible for short session movement. Local governments saw fewer attempts by the General Assembly to limit local authority than in recent years, and regulatory reform efforts were much less intrusive. 

However, the legislature will return for an early August special session to consider legislation from the just-concluded session that did not quite receive its final vote. While technically the authorization for the special session is written to limit the scope of legislation eligible, in practicality any language could be added to bills in play. Legislators may also address litigation concerning legislative actions, potential veto overrides, impeachments, and a handful of other matters. The General Assembly will convene again in early September, when they may revise various judicial and court districts as well as any local government districts. They may also propose amendments to the state constitution, override vetoes, consider impeachment actions, and address several other matters. A potential fall session will allow for the consideration of redistricting of state House and Senate districts, judicial and court districts, and local government districts.

During the 2017 Long Session, significant progress was made on several NCACC goals.  Below is a status report on legislative action that addresses NCACC priorities and affects counties.

  • Click here for a PDF of the entire report.
  1. Legislation Affecting Goals
  2. Other Bills
  3. Goals Status Summary

Lottery Funds for School Construction Grow; Other Revenue Options Still Eligible

NCACC made strong progress on its number one priority goal of the 2017 session – to increase revenue for school capital needs – and there is opportunity for further progress during the rest  of the biennium. After years of advocating to restore the original 40 percent of lottery proceeds for school construction, the Association saw an increase from $100 million to $130 million in year one and $175 million in year two of the biennium for school capital. This increase will go toward a newly-created Needs-Based Public School Capital Fund, which will provide targeted grants in tiers one and two counties. Sen. Harry Brown introduced an earlier version of this legislation as a standalone bill, S234, and succeeded in increasing school capital funding as part of the final budget act. Reps. Kevin Corbin (former Macon County Commissioner) and Jamie Boles both introduced bills to restore the 40 percent of lottery revenue to school capital. The budget includes related language directing future growth from lottery revenues toward school capital with a goal of getting the total amount for school capital back to 40 percent within the next decade.

Partial progress was made on legislation to expand local revenue options – also NCACC’s top Tax & Finance goal – and direct some of the funds to school capital and other education needs. H333, sponsored by Reps. Susan Martin, Howard Hunter, Sam Watford and Jason Saine, authorizes counties to use the Article 43 local option sales tax for several educational needs, and to increase Article 46 from ¼ to ½ cent for general purposes. It passed the House with a strong 103-11 vote, but the Senate did not take any action. Sen. Shirley Randleman sponsored S166, which contained a similar Article 43 change, but the Senate did not consider it. Both bills are eligible for short session.

Legislation to put a $1.9 billion bond referendum for school capital on the 2018 ballot received active support from Rep. Linda Johnson and Sen. Jerry Tillman, the lead sponsors in each chamber.  However, concerns about pursuing another bond this soon after the 2016 Connect NC referendum prevented these bills from moving. Other House sponsors included Reps. Becky Carney, Kevin Corbin and Craig Horn, and Senate sponsors were Sens. Valerie Foushee and Rick Gunn. H866 and S542 are eligible for consideration during the short session.

NCACC thanks all sponsors of the above legislation for their support of addressing the $8.1 billion school capital need in the state and looks forward to continuing this partnership.

School Board Lawsuit Bill Passes Senate, Held Up in House

Bills addressing NCACC’s Public Education goal to limit school boards’ authority to sue counties over school funding were introduced in both chambers this session. S531/H305 School Boards Can’t Sue Counties, sponsored by Sens. Tommy Tucker and Bill Rabon, and Reps. Debra Conrad, Larry Potts and Carl Ford, amends the statute that establishes the dispute resolution process for boards of county commissioners and boards of education.

Currently, if a board of education determines that the board of county commissioners’ appropriation for education is insufficient, the two groups go through informal and formal mediation. If neither is successful, the board of education may file suit against the board of commissioners in Superior Court.

S531 retains the informal mediation. However, it provides that if an agreement is not reached at the meeting, the funding decision of the board of commissioners is final and prohibits the board of education from suing over the appropriated amount. S531 passed the Senate with bipartisan support but was not considered by the House. A provision prohibiting school board lawsuits also appeared in the Senate version of the budget, but did not make it through the budget conference process.

The General Assembly’s Program Evaluation Division has also completed a study on how school board lawsuits against boards of commissioners affect county budgets and relationships. However, the Program Evaluation Oversight Committee did not meet this session, and the findings of the study are not yet public.

Raise the Age Passes in the Budget

A provision to raise the age of juvenile jurisdiction was part of the final budget. The language was originally found in H280, the Juvenile Justice Reinvestment Act. The legislation raises the age of juvenile jurisdiction from 16 to 18 except in the case of A-E felonies. It also includes a number of provisions aimed at reducing juvenile crimes including school-justice partnerships, juvenile justice training for police officers, and the establishment of the Juvenile Jurisdiction Advisory Committee. The budget appropriated nearly $1 million for planning to implement these changes.

In addition, the budget included $13.2 million for the construction of a new youth development center in Rockingham County in anticipation of the need for new juvenile offender housing.   

Slow Movement on Broadband Access

NCACC worked with members of the House and Senate to introduce H390/S208 Counties/Internet Infrastructure, which would give counties the authority to invest in digital infrastructure in unserved areas and lease assets to private Internet service providers. Neither bill was considered in committee; however, throughout session legislators expressed support for more tools at the state and local level to expand Internet access. NCACC thanks all the bill sponsors, particularly lead sponsors Rep. Josh Dobson and Sen. Jim Davis, both former county commissioners.

The 2017-19 state budget bill sets up a special local government industrial site fund and allows funds to go to broadband expansion for economic development. NCACC will continue working throughout the interim and the short session to give counties tools to attract private investment for better Internet access across the state.

County Legal Notices Pilot Program Passes

After several attempts to enact new statewide authority for local governments to publish public notices through electronic means instead of through paid newspaper publication, the legislature passed H205, a bill originally addressing workers compensation to which several other provisions were added. The negotiated language creates a pilot program to allow Guilford County and municipalities within to adopt an ordinance to publish required public notices on the local government’s website instead of in a newspaper. It requires links to such notices on the main page of the government’s website along with emailed notices to any requesting party. The new law also authorizes Guilford County to contract with other entities to publish legal notices on its website – using 50 percent of the revenue for teacher supplements, and contains certain requirements of newspapers. A Senate bill to grant this authority to all local governments passed the Senate and one House committee in different forms, but did not progress further in the House. NCACC thanks Sen. Trudy Wade and Rep. Chuck McGrady, the lead sponsors of the original bills S343/H432, for their efforts over multiple years on this long-standing Association goal.

Legislation Provides Additional Behavioral Health and Opioid Crisis Resources

The final 2017-19 state budget act helps accomplish a key county Health and Human Services goal through several provisions and funding items targeted at community health and behavioral health programs and facilities. NCACC worked with budget writers to roll a number of county HHS priorities into the budget which continues the community paramedicine pilot program in three counties, and directs DHHS to establish a plan using Medicaid funds to reimburse county paramedics for transportation to behavioral health facilities instead of emergency departments. The budget also includes $2 million for new child-focused behavioral health crisis facilities and $17 million for additional inpatient behavioral health beds at five hospitals across the state. NCACC thanks Rep. Josh Dobson, Sen. Joyce Krawiec and all the HHS budget writers for their support of additional resources for county behavioral and community health programs.

The passage of the Strengthen Opioid Misuse Prevention (STOP) Act, in addition to providing more state funds for opioid and substance abuse management, will also help achieve this Association HHS goal as well as an NCACC Justice and Public Safety goal to support funding for intervention and treatment of adolescent substance abuse. The budget combines additional state funding for opioid abuse management, including $250,000 to New Hanover County, with redirected federal grants to specific opioid use treatment and recovery services. These provisions align with NCACC President Fred McClure’s Mental Health and Substance Abuse Presidential Initiative. NCACC thanks Sen. Jim Davis and Rep. Greg Murphy and all the bill sponsors for their support of the STOP Act and resources to combat the opioid crisis.

School Calendar Bill Passes House

Over the course of the session, dozens of local bills were introduced in both chambers granting counties school calendar flexibility. There was also a provision in the House version of the budget that directed the State Board of Education to establish a 20 county, three-year school calendar flexibility pilot program. H375 School Calendar Flexibility/Community Colleges would allow counties state-wide to align their school calendars with community colleges, and passed the House with a 108-6 vote. The bill would allow local boards of education to schedule the opening day to coincide with the beginning of their local community college classes provided the opening date is not earlier than August 15th.  

None of the local bills on school flexibility were heard in committee. The budget provision developing the school calendar pilot did not end up in the legislature’s final budget. H375, despite overwhelming support in the House, remains in the Senate Rules committee.

Budget Adds County Economic Development Tool; Major Tier Reform Stalls

The 2017-19 state budget establishes the NC Ready Sites Fund in the NC Department of Commerce and appropriates $2 million to assist local governments in tier one and two counties with development of infrastructure around industrial sites to help attract economic investment, which is progress toward an Association Tax and Finance goal. The budget also extends the JDIG sunset to 2021 and adds an exemption from JDIG maximum grants to “transformative projects” with a private investment of at least $4 billion projected to create at least 5,000 jobs. Reversing the trend in recent budgets that provided non-recurring dollars, the 2017-19 budget provides $15 million recurring in FY 2018 and $31 million recurring in FY 2019 for the Film and Entertainment Grant Fund.

Throughout the session, the House and Senate introduced various revisions to the state’s tier system and economic development grant programs in H795 and S660, both titled Economic Development Incentives Modifications. However, they adjourned before passing either proposal. The House did pass an amended version of S223 that would exclude economic development projects in tier one and two counties from the maximum annual cap on JDIG funds. That bill was not considered by the Senate prior to adjournment, but will be eligible in the short session.

Subdivision Road Maintenance Bonds Not Authorized

Several bills addressing financial responsibility for roads in subdivisions still under development made partial or no progress this session; NCACC supported some and opposed others. H141/S92 Maintenance Bond for Subdivision Roads would have achieved a General Government goal to allow counties to require bonds for maintenance of subdivision roads until they are accepted into the state system, but neither bill received a committee hearing. The House version of H457/S373 Performance Guarantees/Subdivision Streets passed the House but did not move in the Senate. The bill would have partially achieved an NCACC goal by adding roads to the state system more quickly, but created an administratively-complex maintenance bond authority that in some cases allowed release of the financial guarantee before roads are accepted.