On Wednesday the Senate rolled out a new PCS for HB 1224 -
Economic Development Changes that added what lobbyists for local
government groups were expecting to be additional authority over
local taxes but was instead a limitation of those powers.
North Carolina operates an economic development funding program
called JMAC operated by the Department of Commerce. The fund
provides grants to certain approved companies who meet job creation
thresholds. The grants have time limits and limits on funding
amounts. The bill allows companies in Tier 2 counties (poor) to
join Tier 1 counties (poorest) to be eligible. The bill
also limits the number of JMAC grants to five whose total cost
cannot exceed $79 million (up from $69 million). **My experience as
a legislative staffer was that the JMAC program was amended only
when it needed to fit with an economic development opportunity.
Further specifications that indicate a grant recipient is in mind:
if a large manufacturer is investing in its manufacturing
process - transitioning from coal to natural gas - with
additional pollution controls it may be eligible. The bill also
grows JMAC by establishing that the Department of Commerce
cannot enter into more than five agreements/grants, with total
aggregate cost not to exceed $79 million (was, $69 million).
Wednesday's new section which surprised local government groups
was a provision allowing counties to increase local sales tax in
increments of 1/4 %, by referendum to fund education OR local
transportation projects, but not both at the same time. The total
local sales tax in a jurisdiction must not exceed 2.5%, and the
funds cannot be shared with municipalities. This provision proved
to be very controversial and the bill was returned to committee for
further consideration.
View HB 1224 here: http://www.ncleg.net/Sessions/2013/Bills/House/PDF/H1224v2.pdf
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