A county purchased real property with the intention of preserving it for use as an industrial park or for sale to a business seeking to locate within the county. Authority for making the purchase of land was G.S. 158-7.1. County officials followed the advice provided in this prior post and held a public hearing, properly noticed, prior to approving the purchase of property. Now the county is the proud owner of a fine piece of dirt not far from the highway, but for the moment, there is no room in the budget for making other improvements, such as installing utilities infrastructure. That’s perfectly fine, reasons Tim Taylor, the county economic developer. The county will simply hold on to the land until the budget permits the county to construct improvements or until an interested business purchases the land.
Tim is not the type to sit around and wait for something to happen. Tim markets the property in several economic development trade publications and prepares to bring prospective businesses by the site. After lining up a company to visit the site next week, Tim drives by the property and notices that the grass is too high and that someone dumped heavy vehicle debris on the property. That simply won’t do, Tim thinks to himself, and he visits the purchasing officer in order to make arrangements for grass cutting and for a salvage company to clean up the debris. “Sorry, Tim, you must have missed the memo,” The purchasing officer smiles—Tim has the feeling he is being mocked. “The county manager just reminded all of us that a public hearing is required prior to making any expenditures pertaining to this economic development property. If you want to mow the grass and get that debris picked up, you’ll need to talk to the county manager about setting a public hearing.” Tim is speechless. Does he need a public hearing to have the grass mowed? Read more »
I have been getting many questions lately about the applicability and impact of the federal Prison Rape Elimination Act, or PREA. Specifically, people want to know the extent to which the law and its accompanying regulatory standards apply to local jails. This post provides some background on PREA and then discusses its applicability and enforceability. It concludes with a discussion of the standards themselves, with a focus on those that strike me as most likely to require substantial changes to current jail practices in North Carolina. Read more »
Each local government and public authority is required to adopt an annual budget ordinance that recognizes estimated revenues, authorizes expenditures, and levies tax(es) for the forthcoming fiscal year. The Local Government Budget and Fiscal Control Act (LGBFCA), G.S. Ch. 159, Art. 3, requires, among other things, that the budget ordinance be balanced. A budget ordinance is balanced when “the sum of estimated net revenues and appropriated fund balances is equal to appropriations.” The law requires an exact balances; it permits neither a deficit nor a surplus. And G.S. 159-13 mandates that estimated revenues include “only those revenues reasonably expected to be realized in the budget year . . . .”
The LGBFCA further specifies that the budget ordinance be adopted “not later than July 1 . . . .” G.S. 159-13(a). This is because the fiscal year for local governments in North Carolina runs from July 1 through June 30. A perennial issue facing local government officials in adopting their budget ordinances is predicting the impact that the annual State Budget or other new legislation will have on their revenue streams. Typically the General Assembly adopts its budget only a few days before, or in many cases sometime after, July 1. And a legislative session may run into late summer or even early fall. Local officials tend to be particularly concerned about adopting their local budget ordinances before knowing of any changes to either their local revenue-raising authority or the State’s revenue-sharing programs. This year, for example, the General Assembly has introduced several bills that, if enacted, would overhaul the State’s tax system. Among some of the proposed changes are eliminating local privilege license tax authority and reducing or eliminating certain state revenue distributions to local governments. It is not currently known whether any of the bills will be enacted or in what form. And it is not clear whether local governments will be affected by the specific provisions that might be enacted. The purpose of this blog post is not to analyze the proposed bills and their potential impact on local governments. Instead the post details the budgeting options available to local governments in light of the revenue uncertainty.
A local unit has a few options to deal with this uncertainty. It could delay adopting the budget ordinance, it could budget conservatively to insulate against unexpected revenue reductions, or it could make appropriations based on current expectations and then amend the budget if revenue projections change during the fiscal year. Read more »
Many folks have never heard of zoning board of adjustment, but this is a critically important piece of the local development regulation machinery. Every year these boards hear and decide hundreds of appeals of the interpretation of ordinances made by staff administrators – such as whether an alleged violation is really a violation or whether a proposed land use or project design really meets the ordinance requirements. This board has the power to issue authorization to landowners to develop in ways contrary to the letter of the law – the variance power. Many of these boards make final decisions on special or conditional use permit applications. Boards of adjustment (often referred to as the BOA) may not get the public attention that comes along with a high-profile rezoning debate before the city council, but their work has a significant practical impact on landowners, developers, neighbors, and anyone else concerned about how land development regulations are applied.
The statute creating boards of adjustment and setting their authority was first adopted in North Carolina in 1923. Over the decades the statue has been frequently adjusted – some 17 times by my quick count. The result was a nearly century old statute with its original language largely intact, supplemented with dozens of uncoordinated individual legislative tweaks added over the decades.
Come October, however, we will have a modernized board of adjustment statute. The new law does not drastically alter the fundamental aspects of the prior law. Rather it focuses on providing greater clarity, creating standardized procedures for key actions, and generally providing more certainty and predictability about the processes used by boards of adjustment. This post reviews how that came about and summarizes the changes it will make in the law. Read more »
Local privilege license taxes have been rumored to be on the General Assembly’s chopping block for years. With state legislators from both parties now focused on major tax reform, those rumors seem to have a better chance than ever of becoming fact.
Three major tax reform plans have been introduced this session, two in the Senate and one in the House. In general, all three bills would lower state income tax rates while broadening the sales tax base by applying sales taxes to more goods and services. Their impact on the state budget would vary greatly, however. One bill is intended to be revenue neutral, while the other two would reduce state revenues by more than $1 billion in the short term.
The impact of the bills on local privilege license taxes would also vary. One plan would eliminate local privilege license taxes entirely, one plan would cap local privilege license taxes at $500, and one plan would eliminate a single category of local privilege license taxes but leave the bulk of the tax as is.
It is still far from certain whether one of these three plans will be adopted, whether there will be a compromise plan proposed, or whether we’ll have any movement on this issue at all. Tax reform ain’t easy, regardless of which party is in power.
But just like the Boy Scouts, we like to be prepared for all contingencies here at the SOG. Below is my summary of the potential impact of the three plans on local privilege license taxes, starting with the most severe.
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The General Assembly’s crossover deadline has come and gone, so now is a good time to pause and take stock of pending legislation affecting public purchasing and contracting. Bills proposing changes to our state’s public contracting statutes include authorizing design-build and public private partnership construction contracts, authorizing local preferences, and requiring E-Verify by construction contractors.
Some of these bills have made considerable progress thus far in the legislative session; others are still pending in the committee to which they were initially referred, which does not bode well for their ultimate success.
Bills of interest in the public procurement area are summarized below along with my very tentative assessment of which bills are and are not likely to pass this session. Keep reading to the end of this post to find out how you too can track bills you are interested in. And finally, when the General Assembly adjourns for the year, stay tuned for the School of Government’s annual legislative summary webinars. Read more »