Agenda - 09-20-2007-2c - Laserfiche WebLink

Browse Search

The North Carolina League of Municipalities Page6ofl6 development incentive agreements to include a "clawback" of any local funds from a private enterprise if the business fails to meet the job or investment goals in the incentive agreement. SB 1196 - Modifzcations to Project Development Fir:ancirzg (SL 2007-395) made minor amendments to the requirements for base property values and broadened the uses of tax increment financing/project development fmancing. HB 1761-Job Maintenar:ce and Capitaf Development Fund was created to provide incenrives for companies with 2,000 or more employees that are expected to invest more than $200 million over the next five years. The annual appropriation was set at $3.5 million for up to 10 years. Some bills of interest that were not enacted include: HB 1663 - Confidentiality Agreements Void which would have prohibited local elected officials from signing agreements that would prevent them from discussing or disclosing information about specific economic development projects. It was thoroughly debated in the House but was re-referred to House Commerce. SB 91-Endangered Manufacturing ar:d Jobs Act would provide a variety of tax exemptions and eligibility for economic development grants for textile and furniture manufacturing, regardless of the economic "tier" of the county where the manufacturer is located. The earlier iterations of the bill included a property tax exemption that the League opposed. 'That provision was removed before the bill passed in the Senate, and we appreciate Sen. Jim Jacumin, bill sponsor, for responding to our concerns. The bill remains eligible in the 2008 session. HB 734 - Urbarz Area Revitalization Made Uniform would remove the population threshold of 150,000 to qualify for the urban revitalization projects and special financing authorities in municipal service districts. The bill passed the House and is eligible for consideration in the short session. Exactions/Fee Authority-Legislation that would have the effect of prohibiting cities from imposing regulatory fees passed the Senate towards the end of the session. SB 1180 - No Mor:etary Exaction for Development would prohibit a city or county from imposing or exacting a tax, fee, or monetary contribution for development, a development permit, or a development agreement, unless "specifically authorized by law." The North Carolina courts have recognized city authority to charge regulatory fees by applying the broad interpretation provisions of G.S. 160A-4, but such fees are not specifically authorized by statute. This bill would have an extremely detrimental effect on municipal planning departments that use fees to offset the costs of their regulatory programs. The League's core principles state that municipal grants of authority should be broadly construed to include supplemental powers reasonably necessary to carry out the municipal functions, as the courts have recognized. The bill remained in the House Finance Committee at adjournment but is eligible in the short session. A related bill, SB 1152 -Interest on Illegally Levied Exactior:s (SL 2007-371), was enacted. It provides that if a local government is found to have illegally exacted a tax, fee, or monetary contribution for development that is not specifically authorized by law, the local government must return the tax, fee, or monetary contribution plus interest of 6% per annum. The act applies to actions filed on or after its effective date. Infrastructure Funding-As discussed under 2007 Budget Overview above, cities did not get a share of newly authorized local option sales or land transfer taxes for their infrastructure needs. Bond bills were proposed for a number of infrastructure purposes; including water and sewer, open space land acquisition, affordable housing, and schools, but none of the bills advanced. In the state budget, HB 1473 (SL 2007- 323), $100 million was appropriated to the Rural Economic Development Center for water and sewer grants, and $120 million in certificates of participation funding was authorized for acquisition of state park lands, conservation areas, and land for waterfront access. The Clean Water Management Trust Fund was fully funded at $100 million in each fiscal year of the biennium. The budget also allocates funds for certain named water resources development projects, and provides the state match for federal safe drinking water funds. Local Option Taxes-Although the legislation was not enacted, we thank. Rep. Jennifer Weiss for introducing HB 1982 -Local Option Lard Transfer Tax, which would have provided fora 1 % land transfer tax and included a municipal share, and Rep. Mickey Michaux for introducing HB 153 -Local Option Tax Menu, providing a menu of local option taxes that could be enacted by cities and counties. Motor Vehicle Tax HB 1688 -Amerzd Combined MTrRegistratior: and PT System makes changes to the combined motor vehicle registration renewal and property tax collection system that is slated to go into effect in 2010. To respond to concerns of automobile dealers, it establishes a limited registration plate system so that dealers do not collect property tax at the point of sale. The limited plate expires on the last day of the second month following the date of application for the limited registration. The motor vehicle property tax is due when the limited registration plate expires. Currently, 60% of the first month's interest collected on unpaid motor vehicle taxes is transferred to the Combined Motor Vehicle and Registration Account in the Office of the State Treasurer, with the funds to be used to develop an integrated computer system for the combined assessment, billing and collection of properly taxes and the issuance of registration plates. The legislation provides that the interest generated by the funds in the account is also credited to the account. Once the integrated computer system is operational, any funds remaining in the account are to be distributed to local governments on a pro rata basis determined by the amount paid into the account by each local government. http://www.Helm.org/LegalBulletin12007/08-24-07.htm 8/28/2007