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07/30/2013

General Assembly Session Ends

Highest Resurfacing Appropriation Ever

The General Assembly adjourned last week after back to back late night sessions.  There has been much written about the session and the dramatic change in direction for North Carolina.  It was certainly unlike anything I have witnessed in more than 20 years of lobbying.

The good news for CAPA members is the large appropriation for Contract Resurfacing.  $433 million for fiscal year 2013-2014.  $402 million for 2014-2015.  There will be opportunity for adjustment to the 2014-'15 appropriation in the 2014 "short" session of the General Assembly.  This money will be distributed in the same manner that resurfacing dollars have been distributed in the past.

As you know the Strategic Transportation Investments bill (House Bill 817) passed and was signed by the governor.  It does away with the Equity Formula and distributes the revenue from the Highway Trust Fund and federal aid funds based on a formula with 40% of the money to be used for Statewide projects, 30% for Regional projects and 30% divided equally among the 14 Divisions.  Under the new plan there is appropriated $931 million from the Highway Trust Fund to be distributed under the new formula in the current fiscal year and $950 million in 2014-15.  For a full copy of the budget go to http://www.ncga.state.nc.us/Sessions/2013/Bills/Senate/PDF/S402v7.pdf

The criteria for selection of projects to qualify for Statewide and Regional funding is currently being developed by NCDOT with oversight by the Board of Transportation.  DOT is required to submit a report on the prioritization formulas to the Joint Legislative Transportation Oversight Committee by August 15, 2013.  The JLTOC is required to meet and review the report and provide comments to DOT by October 1.  The final report is to be submitted to the JLTOC by January 1, 2014.  For a full copy of the bill go to http://www.ncga.state.nc.us/Sessions/2013/Bills/House/PDF/H817v10.pdf

The House version of the budget included a provision requiring NCDOT to use a specific Life Cycle Cost Analysis in the selection of pavements for new construction.  The method required by the provision came from a draft DOT report that was never adopted as policy by NCDOT and had not been shared with CAPA at all.  Apparently the document was shared with the concrete lobby and certain legislators and made its way into the budget.  NCDOT was opposed to the provision requiring LCCA and Jim Trogdon sent a letter to legislative leaders explaining the problems with the draft method.  Fortunately the Senate stood fast against the provision and with the help of several of our CAPA members we were able to convince House leadership to remove the provision from the budget.  In its place is a provision requiring NCDOT to report to the JLTOC on their use of LCCA in pavement selection.  This is a problem that will not go away and will require your help to educate your elected representatives.  The requirement for a legislated Life Cycle Cost Analysis is opposed by the Carolinas AGC, The NC Aggregates Association, the Professional Engineers of North Carolina, and CAPA.  Our position is that LCCA is a complicated procedure that should be developed and implemented by professional engineers, not law makers.

On the down side, the cap on the gas tax at 37.5 cents was extended until 2015.  Because gas prices are relatively low this will not hurt revenues as bad as it has in the past but it is still bad policy.  I have been told by people in the new governor's administration that they plan to come up with a transportation funding plan that will eliminate the motor fuels tax.  No specifics beyond that but I for one wish them luck and am ready to assist in any way I can.

Our other disappointment from this session was the Unemployment Insolvency bill that virtually eliminates attached claims.  The bill was fast tracked though the General Assembly in the first two weeks of session and was signed by the Governor before most industries had any idea of its real impact.  We were unable to get any changes made during this session but are already working with Senate leadership to make changes during the 2014 session.  In the meantime, your company is subject to the new regulations which went into effect July 1.  CAPA is planning a forum to help answer questions about the new law.  We will send information out as soon as we have a confirmed date with the Employment Security Commission staff.  It looks like the third week of August.

As always, don't hesitate to call me with any questions or suggestions.

Christie Barbee 

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