North Carolina General Assembly Update - May 2023 #4

KTS Strategies brings years of experience providing clients in a diverse range of industries with comprehensive policy and advocacy advice before federal, state, and local agencies. In North Carolina, we advise local municipalities, corporate transportation entities, nonprofit organizations, statewide associations, government vendors, and Fortune 500 companies before the North Carolina General Assembly and executive branch.

Below is an update on the activity at the NC General Assembly this week, as well as an overview of some activities and opportunities beyond our state’s borders that may relate to your priorities.

Budget Update
This week, the House formally voted not to concur with the Senate version of the budget. This vote officially triggered the conference committee process. Appropriations chairs from each chamber began meeting behind closed doors this week to reconcile the differences between the two budget proposals. Some of the major items in disagreement include teacher and state employee salaries and tax cuts. The goal is to have a budget in place before the end of the fiscal year on June 30.

Gaming Bills
H347, Sports Wagering/Horse Racing Wagering, was approved by the Senate Commerce and Insurance Committee on Wednesday. This bill would authorize and regulate betting on horse racing and professional, college, and amateur sports in North Carolina. A different version of the bill passed the House back in March with a vote of 64-45. The bill has been referred to the Senate Finance Committee for consideration.

H512, Forgivable Loans/HBCU Supplemental Funding, was heard in the House Commerce Committee this week. This bill would authorize the North Carolina State Lottery Commission to issue licenses to twelve operators to regulate and operate video lottery terminals (VLTs), machines used for electronic gambling, in local establishments across the state. The bill would create a North Carolina Video Gaming Fund within the state treasury to handle the revenues brought to the state from taxes on these machines. The bill allocates 35 percent of revenues to the VLT operators, 25 percent to the local establishment, and 40 percent to the State. $1 million of the revenue collected by the state will go the Department of Health and Human Services to be used for gambling addiction education and treatment programs. $10 million of the revenue generated each fiscal year will be dedicated to independent historically black colleges and universities in the state. The bill was for discussion only and did not receive a vote from the committee.

Land Use
A land use and planning bill affecting municipalities and counties (S675) was considered in the Senate Judiciary Committee this week. The original version of the bill would have eliminated extraterritorial jurisdiction authority (ETJ) for all cities by 2025 and prohibited the establishment of minimum lot requirements in land use ordinances. Bill sponsor Sen. Michael Lee (R-New Hanover) offered an amendment in committee on Wednesday that would only eliminate ETJ for counties with a population of 50,000 or less and change the prohibition of lot size requirements to no greater than 8,700 square feet. The bill received a favorable report as amended and will head to the Senate Finance Committee.

Beyond Our Borders with America’s Governors
The KTS Strategies team also is constantly working for clients to advance their priorities beyond the borders of North Carolina—both nationally across the other 50 states and at the federal level. This week was particularly active for our nation’s governors, who gather throughout the year in various forms to share policy ideas and best practices. These meetings normally are organized by the National Governors Association (NGA), the Democratic Governors Association (DGA), or the Republican Governors Association (RGA). And members of the KTS team joined governors and senior gubernatorial staff this week at the Democratic Governors Association (DGA) Spring Policy Conference in Ann Arbor, Michigan, and the Republican Governors Association (RGA) Spring Policy Conference in Austin, Texas.

John Easterling attended the DGA Spring Policy Conference, which focused on a variety of topics ranging from achieving affordability in healthcare to building successful infrastructure partnerships. As John wrapped up meetings in Ann Arbor, Fritz Vaughan joined Republican governors and their senior staff in Austin. The RGA Spring Policy Conference focused on strategies for investing in America’s workforce, enhancing innovation in healthcare to improve patient care and health outcomes, and promoting state energy policies that support Americans at home and our interests abroad. In addition, both conferences provided opportunities to learn more about key races for each party in 2023 and 2024 as well as other opportunities to engage.

Members of the KTS team have been active participants for a number of years at RGA and DGA events, which provide valuable opportunities for participating in panel discussions, engaging one-on-one with governors and key staff, and meeting other business and policy stakeholders from across the United States. But our participation is not limited to our nation’s governors. We engage year-round in national forums attracting a plethora of other state leaders—from legislators to attorneys general—that offer similar strategic opportunities for our clients as the conferences John and Fritz attended this week.

Today, policies with national implications are evolving across both the federal and state levels, with the approach at one level informing the other’s more often than ever before.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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