LEGISLATURE LITE

Paul Fogleman,

The 2017 session has seen the introduction of 161 bills in the House and 130 in the Senate. Most of these bills have no statewide significance as they deal with local issues or so-called technical corrections to laws. However, the Governor still is putting his cabinet in place and advocating for his budget priorities.

MAKE ROOM RESERVATIONS NOW

The Holiday Inn in Raleigh is holding the bloc of rooms for our Legislative Day event until Friday, March 3. To get the group rate of $104 for the night of March 14 you should call before then. You can cancel up until March 13. If you need more information, call Paul Fogleman at 828-322-7766 or email pfogleman@informinc.net.


BUDGET PROCESS BEGINS

Paul Fogleman,

This year the first draft of a $23 billion state budget is crafted by Senate Appropriations Committtees. But the long road to July 1 deadline has begun with House and Senate budget writers sitting side –by-side in the initial staff presentations. Gov. Roy Cooper and the Legislative leaders have called to significant raises for public school teachers—Cooper calling a $55,000 target for the average salary and 5 percent overall increase and Senate chairs with similar proposals.

Rep. Jason Saine, the senior House Finance Chairman, will push hard to eliminate the franchise tax on manufacturing equipment, his aides say. The lawmaker who pushed to retain the assessment on the machine tax did not seek re-election last year.

The final budget will be scrutinized and approved by the inner circles of Senate President Pro Tem Phil Berger and House Speaker Tim Moore, and presented for approval around July 1.

MAKE ROOM RESERVATIONS NOW

The Holiday Inn in Raleigh is holding the bloc of rooms for our Legislative Day event until Friday, March 3. To get the group rate of $104 for the night of March 14 you should call before then. You can cancel up until March 13. If you need more information, call Paul Fogleman at 828-322-7766 or email pfogleman@informinc.net.


WE’RE MAKING SAUSAGE

Paul Fogleman,

This week a Republican legislator was overhead telling a constituent on his mobile phone “We’re making sausage.” That has been an often-quoted description of the law-making process in the halls of government. The end product may be acceptable but the process i messy and sometimes ugly. Debates in the House Judiciary Committee Tuesday had moments of making legislative sausage during a hearing for the “Citizens Protection Act of 2017.”

As the bill title suggests, provisions deal with immigration. Penalties for producing fake documents required by non-citizen immigrants would be raised to felonies. These could include counterfeit drivers licenses, identification papers, and reference documents. The law would impose penalties for people who transport undocumented immigrants. Rep. Harry Warren of Rowan County is the chief sponsor.

MAKE ROOM RESERVATIONS NOW

The Holiday Inn in Raleigh is holding the bloc of rooms for our Legislative Day event until Friday, March 3. To get the group rate of $104 for the night of March 14 you should call before then. You can cancel up until March 13. If you need more information, call Paul Fogleman at 828-322-7766 or email pfogleman@informinc.net.


FRESHMEN ORIENTATION

Paul Fogleman,

First-term representatives are learning the complexities of how bills are handled and how to behave in committee meetings. This week the powerful Finance Committee sponsored a staff presentation on the current financial state of the revenue and trends that will have an impact on spending. Legislators learned that more than half the state money comes from personal income tax. Corporate income taxes have been reduced and generate less than one billion dollars of the $23 billion budget. Sales and use taxes are up to 30 percent of the state’s revenue or almost $7 billion. As corporate tax rates are reduced, more sources of revenue will come from taxes on services and fees, the legislators were told.

Some of the freshman legislators are young, some in their mid to late twenties. The longest-serving House member is Rep. Mickey Michaux of Durham who has a tenure of 40 years.

Our March 15 Legislative Day for hosiery and textiles executives will include visits and presentation to new legislators. We have learned that lobbying legislators while they are in a learning curve is a winning strategy. They do not forget when they move up in seniority. Since 2010 when Republicans won control of the House and Senate, more than 60 percent of the members have gained seniority—and chairmanships.


GORILLA IN THE ROOM?

Paul Fogleman,

Tax policies. Rising healthcare costs for state employees. Education priorities. These will be the headlines when the General Assembly gets down to business. Yet, so far activity in the legislature has been…well, lethargic. This week, fewer than 50 bills had be filed. The few committee meetings had one or two routine agenda items.

The gorilla in the room, many believe, is House Bill 2. Partisan politics over the controversial legislation dealing with transgender people and what bathroom they can use heated up this week. Gov. Roy Cooper wants the lawmakers to rescind the entire bill. Republican lawmakers want him to propose a compromise on the legislation they enacted. But behind the stalemate, there is an effort to address House Bill 2 which has prompted a boycott of the state by entertainers and sports promoters. There is a deadline looming: NCAA will not schedule championship events in North Carolina as long as HB2 in law and scheduling for the next six years will be announced before March 1.


READY TO ROLL

Paul Fogleman,

The 170 members of the N.C. General Assembly are in session and there is a sense of anxiety—ready to move on with a long list of issues, i.e. education and tax reform, and sorting out relationships with a new President and administration in Washington and a new Governor and administration in Raleigh. Legislative Republicans have an overwhelming majority in both the House and Senate but there is a new wrinkle: a Democratic governor with deep experience in the General Assembly and a new Democratic minority leader in the House.

In both Chambers today there was a let’s-get-down-to-business mood. The ceremonial festivities were held two weeks ago. Dozens of bills—some addressing serious objectives and some frivolous—are ready to be introduced.

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MACHINERY TAX BILL

Paul Fogleman,
Rep. Chris Malone(R)

Rep. Chris Malone(R)

Rep. Chris Malone(R) of Wake County is poised to push the bill that will exempt manufacturers from sales or excise taxes on new manufacturing equipment. We are committed to working with him on behalf of textiles and hosiery manufacturers. The current tax is 1 percent on equipment and generates $12 million revenue to the state—a tiny bit of a $23 billion budget.

This year the crafting of a legislative version of the 2017-18 budget begins in the Senate under the leadership of Senators Kathy Harrington of Gaston County, Harry Brown of Onslow County, and Brent Jackson of Duplin County. Sen. Jerry Tillman of Randolph is a senior chair of the Senate Finance Committee and has supported past efforts to eliminate the tax. Sen. Robert Rucho who fought removal of the machinery tax did not seek re-election.

Gov. Roy Cooper also is required to submit a budget to the General Assembly. But as was the case with Gov. McCrory, the document is not expected to influence legislative leaders.

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THE TRUMP LINK TO TEXTILES

Paul Fogleman,

When Pres. Trump appointed Wilbur Ross to be Secretary of Commerce, he created a conduit to his administration for the textiles industry and retailers. Among Ross’ extensive holdings were VF Corp. and Cone Mills, both impacted by NAFTA. Ross maintained North Carolina connections through the N.C. Citizens for Business eand Industry, now the N.C. Chamber. NAFTA was adopted in 1994 and was the first major step that lead to the shakeup of American manufacturing. President Trump will put Secretary Ross on the front lines in the process of renegotiating trade agreements to replace NAFTA. That process will be in full swing by the end of this month.

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HOSIERY AND TEXTILES LEGISLATIVE DAY

Paul Fogleman,

We will have details about a bloc of rooms at the Holiday Inn, Raleigh, for the participants in the annual trip to the General Assembly. The date is March 14 for dinner and March 15 for meetings with representatives and senators.

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WE NEED YOU

Paul Fogleman,

If you have not done so, now is the time renew membership in the Hosiery and Textiles Governmental Affairs Council. Every company membership is important. We are expecting a challenging year with more hours in the halls of the General Assembly. Also, we need funds for HOSEPac before January 25. HOSEPac checks must come from personal contributions, but they are investments in the future of our research and technology centers.

HTGAC Day at the Legislature: March 15

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