public policy advocacy for the professional engineer                                                 July 18, 2014    


Action Alert – Two Items for Immediate Action

Threat to Local Option Sales Tax


On Wednesday, the Senate Finance Committee approved HB 1224 that would, among other things, have a significant impact on the future of local option sales taxes.  It would give all 100 counties local option sales tax authority at 1/2 percent to be used for either education or public transit needs.  This new authority would replace the county’s existing authority to levy a 1/4 cent tax for any public purpose and restructure existing authority for public transit.


In its current version, the main concern is the bill’s impact on flexibility for local government to use their tax dollars on much needed infrastructure.  The bill includes a 2.5% total local sales tax cap, thereby restricting counties from seeking any future sales tax authority and limits the local option sales tax to Education or Public Transit.


The NC Association of County Commissioners is partnering with NCLM and other stakeholders like PENC and AIA to work with General Assembly leadership to address these concerns. A strong possibility could include further study in the interim before the Long Session.


We encourage you to contact your legislators in both the House and the Senate and ask for caution as they consider this proposed legislation.  The message from the Professional Engineers should be:


“As a North Carolina resident and Professional Engineer, I am writing to oppose HB 1224 in its current form because of the limitations it puts on local governments to use local tax dollars for investments that their residents say they want and need.  This cap could significantly impact a County’s ability to invest in needed infrastructure now and in the future.  Infrastructure investment is one of the strongest incentives for economic development and job creation and the needs across the state are critical and vary widely.

The Blue Ribbon Commission on Infrastructure – created in HB 1043 and recently signed by the Governor – among other things, will be studying all infrastructure needs at both the local and state level (public buildings, schools, water/sewer, etc.) to determine priorities for creating a detailed, statewide plan for where to make the best investments that have the most significant return on our State’s economic vitality.  One of the items this Commission will evaluate is local taxing authority. 

Let’s not move too quickly on HB 1224.  Let this Commission study this issue so we don’t undermine its work before we even get started.”

HB 1224 had originally been placed on the full Senate calendar yesterday but was withdrawn and is now scheduled for a vote Monday night, July 21.  We understand that it is on the fast track, as the General Assembly winds down this short session so please contact your legislators as soon as possible.  If the bill is approved by the Senate, it will then move to the House.


HB 201 – Reinstate 2009 Energy Code for NC

Yesterday, Senate Rules approved a rewrite of HB 201 and re-titled it “Building Reutilization for Economic Development Act”.  As you may recall HB 201 originally repealed the 2012 Energy Efficiency Code that was passed by the House last year but was being held in Senate Rules.  It was eligible for consideration this year because it had successfully passed one chamber.  Senator Brock, the bill sponsor on the Senate side, took the original HB 201 and modified it – rewriting the energy code section and adding other provisions related to redevelopment, including changes to stormwater rules. 

While the “new” bill weakens energy efficiency code standards, it is not nearly as detrimental as the original bill would have been.  The new bill only applies to existing commercial buildings, allowing those that received a certificate of occupancy before January, 2012 to use either the 2009 code or the newer 2012 code.  The bill also provides any additions to such a building or structure may be subject to the specified rules, so long as the addition does not increase the floor area of the building or structure to more than 150% of the floor area of the building or structure as it was in existence on December 31, 2011.

Given the likely opposition from the House on the stormwater portions of the bill and the expected session adjournment date of next Friday, it could be very difficult for the bill to be approved by the House and negotiated by the Senate by the end of next week. 


The bill has been calendared to be voted on by the full Senate on Monday night and, if approved will be sent to the House for consideration and action.  You are encouraged to write a letter opposing Part I of HB 201 citing the following:


Part I – Applicability of the Energy Conservation Code to Certain Existing Non-Residential Buildings

1) Appreciation for the rewrite of HB 201that has eliminated the troubling language that would have reinstated the 2009 Energy Efficiency Code standards. 

2) The option of using the 2009 code or the newer code for existing commercial buildings is a significant improvement but still concerning as it will lead to confusion at the local level among designers and local building code officials.  

3) Additional language allowing any modification to an existing building, including the addition of not more than 50% more sq. ft., the option to use either the 2009 energy code or the newer code, can also be confusing when being implemented at the local level. 

4) The newly adopted 2015 Building Code provides sufficient exemptions for historic and existing buildings to meet energy efficiency standards.

Click Here for HB 201.


The stormwater provisions contained in Sections II and VI of HB 201 are currently being reviewed to determine the differences between these provisions and those contained in SB 38 – Amend Environmental Laws for 2014 which is already passed the House.  An analysis comparing the stormwater provisions in HB 201 and SB 38 will be sent out in a separate e-mail.

SB 38 is currently being held in the Senate Clerk’s office.

Click Here for SB 38.


You may find your House and Senate representatives by visiting

Budget Update

After last week’s contentious meetings between House and Senate Budget conferees, Republican senators returned Tuesday with their latest offer that would give teachers 8 percent rather than 11 percent raises and cut fewer elderly people from Medicaid. The new Senate proposal was the first major move in about a week toward finalizing a revised $21 billion state budget. The Senate wanted average 11 percent raises for teachers that would come with major cuts to teacher assistants and elderly and disabled Medicaid beneficiaries. The House wanted more modest raises of 6 percent for teachers that would avoid the steep reductions in teacher assistants and Medicaid.  In its new proposal, the Senate agreed to cut just third-grade teaching assistants, instead of the previous proposal to cut both third- and second-grade assistants. The Senate proposal, however, would pay for the second-grade assistants with one-time money, meaning the legislature would have to agree to pay for them year by year if members wanted to keep them. Senators also agreed to give back more than $100 million in Medicaid cuts they wanted, reductions that would have removed more than 30,000 medically needy people, many of them elderly and in adult care homes. The Senate agreed with the House position to give rank-and-file state employee raises of $1,000 plus benefits. Rep. Nelson Dollar, R-Cary, the chief House negotiator, said he appreciated the progress but said some concerns remain. House negotiators are expected to make another offer of their own.

Meanwhile the Senate unveiled their own Medicaid reform bill this week that was roundly criticized by doctors and hospitals.  The separate House and Senate plans are vastly different with the Governor supporting the House plan. 

Despite the differences that remain over teacher pay raises and funding for Medicaid, the two sides are expected to reach budget agreement “soon”, with an expected adjourn date of a week from today.  Once the budget has been agreed upon, outstanding bills will begin moving very quickly with little time for stakeholders to react. 

In Other News


Coal Ash

Legislation designed to clean up coal ash ponds at Duke Energy power plants in North Carolina is now heading to final negotiations after the Senate rejected the House version of the bill. The Senate voted unanimously Monday to send competing legislation from both chambers to a conference committee to forge a compromise (THE ASSOCIATED PRESS, 7/14/14).

PENC is working with other stakeholders as well as House and Senate leadership to identify Professional Engineers that can serve on the newly created Coal Ash Commission.  Please contact me immediately if you have the relevant expertise and objective experience to qualify for this Commission.

Click Here for Coal Ash Bill SB 729


Water Rules

After years of delays, North Carolina regulators are moving to strengthen state water-quality standards to include tougher limits on toxic metals. But representatives from environmental watchdog groups say the proposed standards include loopholes that would allow farms, industries and sewage treatment plants to pour too much pollution into waterways (Michael Biesecker, THE ASSOCIATED PRESS, 7/15/14).

Cleanup Plan

An electronics company has been given a month to develop plans to clean up around an old plant in western North Carolina. CTS Corp. has until Aug. 11 to submit plans to the Environmental Protection Agency for the old plant in Arden. Officials say there are polluted springs and a plume of tainted groundwater under the site (ASHEVILLE CITIZEN-TIMES, 7/15/14).

Fracking Comment

North Carolina's environmental protection agency said Tuesday that it is accepting written public comments on the state's proposed fracking rules through Sept. 15. The Department of Environment and Natural Resources will accept written comments in addition to taking live statements at three public hearings in August. These will be the last opportunities for residents and organizations to comment on about 120 safety rules proposed to govern shale gas exploration in the state (John Murawski, THE NEWS & OBSERVER, 7/16/14).

Highway Funding

Faced with the threat that federal money for 117,000 transportation projects would begin to dry up in two weeks, the U.S. House on Tuesday approved a nearly $11 billion patch to extend funding through May (Ashley Halsey III and Juliet Eilperin, WASHINGTON POST, 7/15/14).





If there are questions or you need additional information, please feel free to contact me at or phone 919-834-1144, ext. 1.


Betsy Bailey
Professional Engineers of North Carolina




What's In This Edition:


Threat to Local Option Sales Tax


HB 201 – Reinstate 2009 Energy Code for NC

Budget Update

Coal Ash

Water Rules


Cleanup Plan


Fracking Comment


Highway Funding




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