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Moody's strips North Carolina of its Triple A credit rating
Action rattles budget conferees, prompts
Easley to again call for a lottery
North Carolina
lost its sterling credit reputation Monday when Moody’s, one of three New York
bond rating agencies, assigned an Aa1 – one point below Triple A -- to the
state’s $3.5 billion long-term debt. Moody’s said the downgrade reflects the
state's continued budget pressure, its reliance on non-recurring revenues and
its weakened balance sheet. North Carolina can regain the top credit rating it
had enjoyed since 1960 by
“restoring structural budget balance and rebuilding reserves,” Moody’s
said.
Moody's noted that North Carolina has been running operating deficits for the last two
years and likely will again in fiscal 2002. Moody's had a couple of suggestions
for solving the state's dollar dilemma, advice plainly directed at the House and
Senate budget conferees: "Some measures
currently under consideration to reestablish structural balance in the long term
remain politically sensitive and uncertain," Moody's said. "These include a sales tax increase
and a state lottery."
Those words propelled Gov. Mike Easley to the microphone to renew his call for both,
particularly the lottery. "They're saying, 'This is your way out of the
woods -- why don't you do it?'" Easley said at a Tuesday press conference.
"This comes as close to telling us what we need to do as anything you'll
ever see coming out of one of these agencies." Easley also warned that the
downgrade might create a domino effect, rolling over local governments around the state.
State Treasurer Richard Moore said higher debt payments from the lower credit
rating won’t have an
immediate impact on the balance sheet because interest rates are at historic lows. But in
a letter to legislators he urged them to do what Moody’s
called for. Moore said the General Assembly needs to send a message to the other
two ratings houses, Standard and Poor’s and Fitch, that the state is shoring
up its finances. Many believe that what comes out of budget conference committee could affect what the other two ratings
agencies decide.
North Carolina was one of only 10 states with a Triple A credit rating, and
although all 10 have experienced budget deficits, we're the first to be
downgraded. The remaining Triple A states are Delaware, Georgia, Maryland,
Michigan, Minnesota, Missouri, South Carolina, Utah and Virginia. North Carolina
joins a group of nine other states on Moody's next-best list, Aa1.
Nothing firm emerged on a compromise House-Senate budget for the now-seven-week-old fiscal year.
House and Senate leaders continue to work "behind the scenes" to
resolve disputes over the available revenue and disputed items in the budget
bills passed by each chamber.
A summary of key points in the credit rating report is reprinted at the end of this
newsletter.
Economic
stimulus bill wins key vote on House floor
Legislation
to revamp the state's economic incentive politics
cleared a major hurdle Thursday when the House passed the bill by a vote of
79-29 on second reading. The measure made its way to the floor after
undergoing three days of debate and consideration of 20+plus amendments in the House Appropriations Committee,
which favorably reported H.
1734 N.C. Economic Stimulus Job Creation Act on Wednesday. The NCCBI-backed legislation
strengthens the state’s economic development efforts by making tax incentives policies
more attractive to expanding and relocating businesses.
House passage of the measure was bolstered by convincing testimony to the
Appropriations Committee from Gordon Myers of Asheville,
NCCBI’s past chairman who now chairs the State Economic Development Board; and
NCCBI President Phil Kirk, also a board member. Although heavily amended, the
bill still retains its cornerstone program, creation of a tax rebate for new
worker wages. More
amendments are expected to be offered Monday night when the bill comes up for
its third and final vote on the House floor. Then it will go to the Senate.
The bill creates the state's first "cash back" tax credit in which
companies creating new jobs would get to keep most of the state income taxes
paid by workers in those new jobs. Eighteen other states offer similar programs.
As originally written, the bill specified up to 80 percent of state taxes on
wages paid for 15 years, essentially what South Carolina offers. It was amended
to spell out a 75 percent rebate for 12 years. The
committee also accepted language to encourage equitable distribution of the
grants by region and specified that no more than 25 grants could be awarded in a
single year. Another amendment passed expanding the three-person panel to review
and approve the grants -- from the Revenue and Commerce secretaries plus the
state budget director to include the state Labor secretary and the president of
the Community College System.
Myers testified during Tuesday’s committee meeting, saying “To put it
plainly, North Carolina is truly competitive in only a fraction of the kinds of
corporate expansion projects that each of you would love to see bring new jobs
to your district. And only through new incentive legislation will we change
this. Critics would ask you to put blinders on so that you don’t see what’s
happening all around us. I ask you to keep your eyes wide open and look at the
facts. Eighteen other states have already enacted legislation that provides the
same type of incentives as H. 1734. We may not like incentive packages but they
are here to stay.”
Kirk also testified Tuesday, saying “We need this job stimulus package, but
more importantly, our workers need it. There are many ideas about how to help
businesses create jobs, but this bill is the only vehicle which is viable in
this session. There is not time in this session to come up with another
approach. This bill has safeguards and limits. Please don’t tie our economic
developers hands by putting a cap on the job grants. South Carolina and other
competitors would love that.”
Speaking against the bill were Perri Morgan, head of the state chapter of
National Federation of Independent Businesses; and John Carrington of the John Locke
Foundation.
Kirk said passage of the legislation "will be a tremendous boost to small
businesses. When a community lands a big or mid-size industry, every business in
town benefits. Car dealerships, real estate agents, retail merchants,
restaurants, gasoline stations, all see their business go up."
Myers' testimony reflects recommendations by the State Economic Development Board
to jump-start North Carolina's hunt for buffalo in the new economy. The board
found that North Carolina offered some of the least attractive economic
incentive packages in the Southeast, mainly because it has so few "cash
back" tax programs. He explained this new thinking in testimony excerpted
below:
"Given the state of the stock market and the overall economy, companies
seeking a new facility are increasingly cost-conscious. And while companies
don’t want to publicly announce that they’ve sold themselves to the highest
bidder, incentives are often the single largest factor in relocation decisions.
"Where I live and work in Western North Carolina, the competitive pressures
from neighboring states play a role in virtually every project we recruit. We
have lost projects to South Carolina, Georgia, Tennessee and Virginia, many of
whom already offer job development tax credits, or similar incentives that are
simply more competitive than what we have to offer today.
"Now some of you may agree that incentives are needed, but you may have
concerns about the way that this bill implements them. Some proposed a cap on
the dollar amount in terms of incentives that we could apply. While the bill
does put a cap on the number of projects, I would argue that to put a cap on the
amount of incentives that could be leveraged would also put a cap on the amount
of corporate investment we would encourage in the state. With a cap on the
dollar amount, we would essentially be turning employers away if they have too
many employees or if they pay their workers too much.
"And some have expressed reservations about the makeup of the committee
that chooses projects that would receive these incentives. The committee is
small, as it must be to make quick decisions in real time. High-level
negotiations in business recruitment today are time sensitive; just the delays
in coordinating the schedules of a larger committee might give a competitor time
to pull the rug out from under us. In addition to being small, the committee
must be those best positioned to measure the impact of new projects and the
incentives applied.
"I submit to you that the governor himself is our
state’s top economic developer and positioned uniquely to recruit the kinds of
businesses we need. His top lieutenant in business recruitment is the secretary
of Commerce, who would bring that perspective to the committee. As far as
calculating the potential tax implications and budget implications, we have the
top state officials representing both of these crucial areas to ensure
incentives generate revenues, not costs. And because the legislation requires a
unanimous recommendation, none of the three can act without considering all
consequences at the highest levels,” Myers said.
Here is the list of House members who voted against the business community on
the incentives legislation on second reading: Alma Adams (D), Rex Baker (R), Jeff Barnhart (R), John
Blust (R), Marge Carpenter (R), Mark Crawford (R), Billy Creech (R), Leo
Daughtry (R), Don Davis (R), Rick Eddins (R), Teresa Esposito (R), Robert Grady
(R), Bob Hensley (D), Mark Hilton (R), Julia Howard (R), Verla Insko (D),
Joe Kiser (R), Paul Luebke (D), Gene McCombs (R), Mickey Michaux (D), Paul
Miller (D), Frank Mitchell (R), Richard Morgan (R), Martin Nesbitt (D), Art Pope
(R), Mitchell Setzer (R), Fern Shubert (R), Jennifer Weiss (D), Roger West (R).
Vote
on session limits coming soon!
With the Sept. 10 primary election just two and a half weeks away, we
anticipate a vote on session limits legislation will occur in the House within the next two weeks.
The State Board of Elections has indicated that in order for this
constitutional amendment to be on the Nov. 7 general election ballot, the bill will have to
pass by Sept. 10.
NCCBI has met with the House leadership this week and encouraged them to
calendar the bill as quickly as possible. Although
no definite date for the vote has been given, NCCBI expects the bill to be voted
on
very soon. Many NCCBI members have made
calls and sent letters and e-mails to House members encouraging them to support
session limits. Now is the time to
follow-up again with all members of the House.
Please call or e-mail your House members immediately and urge them to support
session limits. This is the No. 1
priority set by NCCBI’s Board of Directors. Information
about the bill and reasons to urge support for this issue have been sent out
previously. For a quick reference on the concerns about this issue and
reasons to support the bill, you can refer to Phil Kirk’s article in the July
edition of North Carolina magazine.
You can read that article on the NCCBI web site by clicking on: http://www.nccbi.org/mag-07-02publetter.htm.
This is an important issue. We are
already seven weeks into the new fiscal year and the state budget has not been
adopted. It is time for the General
Assembly to pass session limits legislation and work under real deadlines like a
majority of states in the country.
Make those follow-up calls today!
Legislative Actions
House mulls giving
35,000 jobless workers another 13 weeks of benefits
The
House has begun debate on a bill recommended by the state Employment Security
Commission granting an additional 13 weeks of unemployment checks to more than
35,000 people who are about to exhaust their benefits. The measure, H. 1040
Temporary Extended Unemployment Benefits, sponsored by Rep. David Redwine
(D-Brunswick) allows the state to tap a pool of $125 million in federal
funds to pay for the additional benefits. Last year Congress passed a
supplemental package of unemployment benefits for workers hard hit by the
recession creating
an additional 13 weeks of benefits. H. 1040 would allow laid-off North Carolina
workers to become eligible for a second extension of up to 13 weeks. Both
programs would end December 31.
... The House Finance Committee on Wednesday favorably reported S. 1054
Judicial Campaign Reform Act, the "get the judges out of policies"
bill sponsored by Sen. Wib Gulley (D-Durham) to
create a public system of financing campaigns for seats on the Court of Appeals
and Supreme Court. The favorable vote was largely along party lines, with
Republicans opposed. Like a similar bill that passed the Senate last year, the
measure creates a pool of public funds through voluntary tax check offs and new
annual fees on attorneys.
... The House gave second- and third reading approval Tuesday to H. 1736 Retired
Legislator License Plate (Greg Thompson), a bill that directs the DMV to make special license plates for former legislators
who have served at least five years. Legislators will be exempt from a requirement that groups seeking a special license
plate have 300 people apply before becoming eligible for one.
State
Government Watch
State borrowing $250
million off the books to lease prisons
North
Carolina is moving ahead with its plan to borrow $250 million off the books to
pay for three new prisons that a private company will build and lease to the
state. The plan was put in motion last year when the General Assembly created
the nonprofit N.C. Infrastructure Finance Corp. and authorized it to borrow
money to buy three new 1,000-bad maximum security prisons now being constructed
in Alexander, Anson and Scotland counties. The corporation will lease the
prisons to the Department of Correction for 20 years. The state will make lease
payments totaling $370 million or about $18.6 million annually. At the end of
the lease the state would own the prisons. Former Treasurer Harlan Boyles and
others are critical of the deal, saying the state shouldn't issue bonds without
a vote of the people. But legislators say this is a quicker way to get the
prison beds the state desperately needs. When the prisons open next year, the
corporation will sell certificates of participation to investors backed by the
state's future lease payments, not by the state's full faith and credit.
Although the General Assembly must appropriate annual payments to the
corporation, the deal is recorded as a lease instead of a debt on the state's
books.
Treasurer takes heat for
paying adviser $250,000 a year
State
Treasurer Richard Moore is taking some flack for agreeing to a potential salary
of $250,000 for a new senior investment adviser he’s hired. Moore says
that’s fair compensation for Andy Silton, a former president of TradeStreet
Investment Associations who was hired last month to act as CFO for the state’s
$60 billion pension fund. Moore called in a reporter for the News and Observer
to disclose terms of Silton’s contract, which calls for a $170,000 base
salary plus a 30 percent compensation bonus, a salary that makes him among the
highest-paid employees in state government. "It is difficult to create the
appearance of being as frugal as possible in this environment, but I'm trying
not to practice pennywise, pound-foolish tactics," Moore told the N&O.
"I am convinced that North Carolina's finances will be better off in the
long run, and I felt that I had no choice." Before TradeStreet, Silton was
an executive vice president at Legg Mason in Baltimore and oversaw $104 billion
in investments. His salary will come from fees that the state has recaptured by
renegotiating commissions with brokers, Moore said.
Students'
scores improve on college admissions test
North
Carolina students scored slightly higher marks on the ACT Assessment college
admissions test last year, even as the nation's average score declined slightly,
state education officials said Wednesday. North Carolina's average composite
score of 19.9 on the test is below the national average of 20.8. But North
Carolina's average score rose from 19.7 last year while the national average
declined from 21. Most college-bound high school graduates take the SAT test;
only 13 percent (9,129) of the graduates took the ACT. The UNC System accepts
either for admission. State Superintendent Mike Ward said the ACT results, like
the SAT, are directly connected to the coursework students take in high school. "Students
who have any thoughts of going to college need to enroll in the courses that
will prepare them for this work from the beginning of their high school
careers." State Board of Education Chairman Phil Kirk said the need for
students to be better prepared for their next level of learning was one of the
key reasons the State Board approved requiring students to select one of four
courses of study in high school. The courses of study are Career Preparation,
College Technical Preparation, College/University Preparation and Occupational
(only for certain students with disabilities who have an Individualized
Education Program).
Group
praises state's regulation of home inspectors
North
Carolina ranks third in the nation for the strength of its laws regulating home
inspectors, according to a review by the American Society of Home Inspectors.
The organization, which represents nearly 6,000 home inspectors nationwide,
advocates strong oversight of practitioners. North Carolina got high marks for
mandating standards of practice, having clear licensing procedures and a
definition of prohibited acts. The state has regulated home inspectors since
1993.
State jobless rate rises
slightly to 6.8%
North
Carolina's seasonally adjusted unemployment rate climbed a tenth of a point in
July to 6.8 percent even though total employment in the state rose, the ESC
reported. The slight rise in joblessness largely was attributed to temporary
factory shutdowns that normally occur around the Fourth of July holiday. The state’s jobless was 5.7 percent a year ago. The state's labor force
increased by 7,500 to 3,985,900 in July while total employment increased
2,800 to 3,713,800. Total unemployment increased by 4,700 to 272,100
during the same period. The state paid more than $105 million in unemployment
insurance benefits in July, bringing year to date total benefits paid to roughly
$1.2 billion. That left a
balance in the Trust Fund of roughly $367 million, compared to
roughly $907 million a year ago. The average weekly benefit check was $251.17
for the month.
During July manufacturers added a net 300 new jobs
with the largest increases in textiles (+1,000), printing and
publishing (+400), furniture & fixtures (+400), transportation equipment
(+300), and stone, clay & glass (+300). These gains were offset by decreases
in apparel (-500), lumber & wood (-400) and electronic equipment (-400).
DOI questions profit margins
at Blue Cross
The N.C. Department of Insurance
(DOI) has asked Blue Cross and Blue Shield of N.C. to prove that the insurer's
rising profits aren't related to a desire to make its stock attractive after it
converts to for-profit status. In an Aug. 15 letter to BCBSNC, DOI asked
rhetorically why the company's rising profits should
not be transferred to
policyholders "in
the form of a reduction of premiums or a refund of premiums instead of enhancing
the surplus of an already highly
capitalized non-profit organization?" The DOI letter then says "the burden is on
BCBSNC to demonstrate that these
significant profit margin increases are not related to the proposed conversion."
Blue Cross reported a record profit
of $85.6 million last fiscal year during a time in which it imposed double-digit premium increases
on many of its
customers. Blue Cross counters that its recent profit margins are comparable with its for-profit
competitors. The insurer is being pressed on the other side of the issue by the
entity holding trademark rights to the Blue Cross and Blue Shield name. It has
warned BCBSNC that it might not get to keep the logos if it hands over too much
control to the nonprofit foundation.
Incentives
deal gone sour sparks lawsuit
Alleghany County, Sparta and three other entities are suing Bristol Compressors
to recover $7.3 million in incentives they gave the company in 1993 to open a
major manufacturing facility in the county. Other parties in the suit are Blue Ridge
Electric Membership Cooperation, Skyline Telephone Co. and the Region D
Development Corp. They claim Bristol Compressors breached a 10-year contract
giving it about $15.5 million in cash and other considerations in return for
opening a manufacturing plant employing 440 people.
However, the company announced recently that the plant will be mothballed at
about the same time as it also announced plans to expand its Virginia
facility by
350 jobs. The state, which extended nearly $8 million in benefits to Bristol in
the form of road improvements and tax credits, isn't a party in the lawsuit.
FedEx
opponents take case to federal appeals court
Diehard
opponents of the FedEx project at Piedmont Triad International Airport have
filed a legal brief with the Fourth U.S. Court of Appeals in Richmond arguing that the
Federal Aviation Administration continues to ignore evidence that a new runway
for the cargo hub isn't necessary. The appeals court
now must decide whether to hear oral arguments as soon as October or issue a decision based solely on
briefs already filed. The Greensboro News & Record reported that the
opponents hope to force a further environmental review of the site.
The challenge cannot stop the hub, but it can force the FAA to review it
further. PTI also still needs state and federal environmental permits for the
hub, the newspaper said.
Transportation
Work begins on final leg of
U.S. 64 bypass
Highway
construction work will begin Monday on the final section of a project to
eliminate one of Raleigh's worst traffic bottlenecks -- a stretch of U.S. 64
from east of New Hope Road in Knightdale to the Rolesville Road interchange in
Wendell. U.S. 64 is a major artery for commuters from north and east of the
city. Most of the 9.6-mile project will be
constructed on new location, with no impact to motorists. As construction
progresses, however, motorists can expect temporary lane closings and delays as
bridges and interchanges are built. The entire bypass is expected to be open to
traffic in late 2004. Construction has
already been completed on the first section, between U.S. 64 and west of Poole
Road. The second section, which extends from I-440 to east of New Hope Road, is
currently under construction. Upon
completion, the entire 11.6-mile bypass will extend from Interstate 440 to the
existing U.S. 64 east of Knightdale, with interchanges at New Hope, Smithfield,
Hodge and Rolesville roads.
Officials dedicate
5.2-mile-long Virginia Dare bridge
At
a ribbon-cutting ceremony on Aug. 16, state and local officials celebrated the
completion of the U.S. 64/264 Manteo Bypass. The
7.8 mile, 4-lane project begins at Shipyard Road in Mann's Harbor and includes a
5.2 mile bridge over the Croatan Sound into Manteo -- the state's longest
bridge. During the ceremony, the bridge was dedicated to Virginia Dare, the
first English child born in America. Here are some interesting facts about the
$102 million bridge, which was featured on the cover of the July North Carolina
magazine:
- The bridge rises 65 feet at its apex and is
supported by 88 concrete columns and more than 2,000 pilings, which extend
nearly 100 feet below the water.
- It shaves 20 minutes off the trip for
motorists approaching Manteo from the west.
- It provides a more efficient evacuation route
during hurricane emergencies.
- It will also improve traffic flow around
Manteo everyday as well as during tourist season.
- To protect the wetlands along the Croatan
Sound, DOT designed a high-rise bridge that goes over the entire coastal
marsh (3,000 feet).
- Over these areas, the highway runoff is piped
into a separate basin, which keeps these areas clean.
- The bridge includes nearly 44,000 cubic yards
of deck concrete, enough concrete to cover 278 basketball courts.
- If the re-bar in the deck was laid end-to-end,
it would be enough for a round trip from Manteo to Wichita, Kansas.
- The bridge weighs more than 350,000 tons.
Legal Beat
Appeals Court sides with
Maharishi Spiritual Center in tax case
The
Maharishi Spiritual Center, which teaches transcendental meditation and operates
a girls' school on 550 acres of prime Watauga County land, is a legitimate
educational institution exempt from local and state property taxes, a divided
N.C. Court of Appeals ruled Tuesday in overturning a decision by the N.C. Tax
Commission. The Spiritual Center does not award formal diplomas or degrees but
teaches precepts of natural law and transcendental meditation to hundreds of men
and women who pay tuition plus $1,000 a month they raise on their own. The Watauga County Board of Equalization and Review in
1999 denied the Spiritual Center's request for exemption from property taxes for
61 parcels of real estate and associated personal property. The board also
denied exemption for the Heavenly Mountain Ideal Girls' School and undeveloped
property owned by the Spiritual Center. The Spiritual Center appealed to the Tax
Commission but was rebuffed. In an opinion written by Justice James A. Wynn Jr.
and concurred in by Justice Robin E. Hudson, the court reversed the Tax
Commission on most counts, ruling that the Spiritual Center should be exempt
from taxes. Justice John Tyson dissented. The case is No. COA01-644.
Workers Comp case: The night manager of a Burger King restaurant in
Laurinburg cannot make a workers' comp claim against the company because it
failed to run a background check on another worker who later assaulted her, the state Court of Appeals ruled Tuesday in upholding a Superior Court
decision. The night manager, Lolitta Hunt Caple, was assaulted by another worker
at the fast food establishment who, it was later determined, had lied on his job
application about past criminal convictions. Caple suffered minor injuries when
she was assaulted and robbed by the other employee, and received workers' comp
benefits for those injuries. She subsequently sought benefits for emotional
distress for the assault, which she alleged wouldn't have happened if the
restaurant had run a background check on the other employee. The Appeals Court
disagreed. The case is No. COA01-906.
Choice of utility provider: A veterinary clinic in Havelock can
rightfully choose to purchase electricity from Carteret-Craven Electric
Membership Corp. (CCEMC) instead of the municipal power system operated by New
Bern, the N.C. Supreme Court ruled Aug. 16. The clinic once was served by the
municipal system but built a new facility on adjacent property and secured
service from CCEMC. New Bern sued CCEMC, alleging that it had violated its
exclusive right to serve the clinic, and the issue eventually wound up in the
Supreme Court. In an opinion written by Chief Justice I. Beverly Lake Jr., the
court said the clinic could choose a new provider of electricity because neither
New Bern nor CCEMC held exclusive rights to serve Havelock and because the
clinic had moved to a new premises. The case is No. 450PA01.
Golf club can sue developers: Property
owners at Governors' Club, an upscale community near Chapel Hill that features a
Jack Nicklaus golf course, should be allowed to sue the developer for problems
discovered in the construction of the clubhouse, pool and golf course after the
property owners assumed control of the facilities. The N.C. Court of Appeals, in
an opinion written by Justice James A. Wynn Jr., ruled that a Chatham County
Superior Court judge incorrectly dismissed the property owners' suit. The
property owners allege the developer, Governors Club Development Corp.,
misrepresented the condition of the facilities at the time they were handed
over. The case is No. COA01-394.
Events
Are you registered for
the NCCBI membership meeting in your area?
Hundreds
of NCCBI members have sent in their registration forms to attend one of the 19
area meetings coming up in September and October. We hope you plan to attend one, because this year we've updated the format to make the meetings
more informative for you -- including a question and answer session at the end of
each meeting. If you haven't already registered, please consult the calendar
below to select the event you'd like to attend. Then, send in the registration
brochure we previously mailed to all members. It's not a problem if you can't
locate the brochure; just send an e-mail to Marsha Lewandowski of
the NCCBI staff at mlewandowski@nccbi.org
stating your name, company name and the site of the meeting you'd like to
attend. See you there!
| September |
4
|
Wednesday
|
11:45 a.m.
|
Triangle Area Meeting, Angus Barn
|
26
|
Thursday
|
5:30 p.m.
|
Rocky Mount Area Meeting Reception,
Benvenue Country Club
|
30
|
Monday
|
7:30 a.m.
|
Asheville Area Meeting Breakfast,
Grove Park Inn, Asheville
|
30
|
Monday
|
11:45 a.m.
|
Boone Area Meeting Luncheon,
Broyhill Inn
|
| October |
1
|
Tuesday
|
11:45 a.m.
|
Charlotte Area Meeting Luncheon,
Charlotte Marriott City Center
|
1
|
Tuesday
|
5:30 p.m.
|
Salisbury Area Meeting Reception,
Salisbury Country Club
|
7
|
Monday
|
5:30 p.m.
|
Greensboro Area Meeting Reception,
Grandover Resort
|
8
|
Tuesday
|
7:30 a.m.
|
High Point Area Meeting Breakfast,
String & Splinter
|
8
|
Tuesday
|
11:45 a.m.
|
Winston-Salem Area Meeting
Luncheon, Salem College
|
8
|
Tuesday
|
5:30 p.m.
|
Statesville Area Meeting Reception,
Statesville Civic Center
|
15
|
Tuesday
|
11:45
a.m.
|
Elon
Area Meeting Luncheon, Elon University, Mosley Center
|
21
|
Monday
|
5:30
p.m.
|
Greenville Area Meeting Reception,
Hilton Greenville
|
22
|
Tuesday
|
11:45 a.m.
|
New Bern Area Meeting Luncheon,
Riverfront Convention Center
|
22
|
Tuesday
|
5:30 p.m.
|
Kinston Area Meeting Reception,
Kinston Country Club
|
23
|
Wednesday
|
11:45 a.m.
|
Fayetteville Area Meeting Luncheon,
Holiday Inn Bordeaux
|
23
|
Wednesday
|
5:30
p.m.
|
Wilmington Area Meeting Reception,
City Club at deRosset House
|
24
|
Thursday
|
11:45
a.m.
|
Southern Pines Area Meeting
Luncheon, Mid Pines
|
29
|
Tuesday
|
11:45
a.m.
|
Hickory Area Meeting Luncheon,
Holiday Inn Select
|
30
|
Wednesday
|
11:45
a.m.
|
Elizabeth
City Area Meeting Luncheon, Pine Lakes Country Club
|
Defense attorneys plan forum with candidates for appellate courts
The
North Carolina Association of Defense Attorneys will hold a Judicial
Candidates’ Forum on Friday, Oct. 25, at the Grandover Resort & Conference
Center in Greensboro. The forum, which rill run from 11:00 a.m. to 12:30 p.m.,
will feature judicial candidates for seats on the North Carolina Supreme Court
and the Court of Appeals. The forum, which NCCBI is co-sponsoring, will be held in conjunction with the
Defense Attorneys’ annual Fall Seminar, is expected to attract more than 300
attendees.
Twenty-one candidates are
seeking election for open appellate level judicial seats - six candidates for
the state Supreme Court and 15 candidates for the Court of Appeals. Candidate
participation will be confirmed after the Sept. 10 primary elections.
Information about each candidate may be found on the NCADA’s website at www.ncada.org.
The forum gives members of
the public and the bar a rare opportunity to learn about the candidates who wish
to serve the state at the appellate court level. Each candidate will have the
opportunity to briefly discuss his or her qualifications for the position and
answer brief questions regarding areas of concern for civil defense attorneys
and their clients.
The North Carolina Association of Defense
Attorneys brings together civil trial attorneys to promote the exchange of
information, ideas, and litigation techniques, and to strengthen the practice,
improve the skills, and enhance the knowledge of lawyers defending individuals
and businesses in North Carolina. For more information about the N.C.
Association of Defense Attorneys or the Judicial Candidates’ Forum, please
contact the Association office at 1-800-233-2858.
Pinehurst to host
Executive Golf Championships
If
you’re an upper-level executive with a golf game to match, then the inaugural
United States Executive Golf Championships might just fit you to a tee.
Scheduled for Nov. 14-17 at Pinehurst Country Club, the 54-hole tournament is
for CEOs and other business executives nationwide who boast handicaps of 15 and
under. It is being staged by Executive Golf Management, headed by former Duke
University and NBA star Jack Marin, along with Pinehurst Championship
Management. Gov. Mike Easley has agreed to serve as the tournament’s honorary
chairman.
The event will be played as a gross tournament with flights for various handicap
brackets as well as an overall championship to determine the 2002 U. S.
Executive Golf Champion. There will also be a best-ball consolation. In all,
there will be six championships to vie for. With Pinehurst Championship
Management assisting in the operation of the event, it is an opportunity for
business executives to participate in a championship-caliber event on a U.S.
Open golf course. The tournament will be played at Pinehurst No. 2, No. 4 and
No. 8.
NCCBI believes that this event can become a showcase for North Carolina and an
annual attraction for some of America's finest business leaders to visit our
great state. To date, the tournament has commitments from approximately 35
business executives from across the country. In this inaugural year a field of
60 would be ideal, but 120 can be accommodated.
For more information, contact Jack Marin (919-981-4058 or jack@USexecutivegolf.com)
or Bert Hensley (919-672-2237 or bert@USexecutivegolf.com).
Easley announces memorial
ceremony to mark Sept. 11 attacks
Gov.
Mike Easley and First Lady Mary Easley invite the public to attend a special
ceremony on Wednesday, Sept. 11 on the State Capitol grounds (Hillsborough
Street side) at 11 a.m. to honor those who perished in the terrorists' attack.
Special guests scheduled to participate include: Gov. and Mrs. Easley, Secretary
of Crime Control & Public Safety Bryan Beatty, Adjutant General William E.
Ingram Jr., and Raleigh City Mayor Charles Meeker. Guests will hear patriotic
music from the Raleigh Concert Band, Carolina Harmony Chorus, Sweet Adelines
International, and others.
Federal Issues
Edwards
sticks to his call for mandatory ergonomics rule
U.S.
Sen. John Edwards told NCCBI he will continue supporting legislation directing
OSHA to produce a new ergonomics rule within two years. NCCBI and most other
business groups support a Bush Administration decision in April creating
voluntary ergonomics guidelines administered by the federal Labor Department. However,
the Senate Appropriations Committee in late July stuck $2 million into the Labor
spending bill for costs associated with reissuing an ergonomics rule if Congress
mandates one later this year. Democrats may have included the language to
prevent the Bush Administration from arguing a lack of money, if Congress
mandates a new standard. NCCBI believes Congress should give OSHA’s voluntary guidelines a chance to
work before mandating a “one size fits all” scheme, and told Sen. Edwards so
in a recent letter. He replied: "I understand your view that these
guidelines should be given an opportunity to work before a mandated solution is
forced on the business community. I must respectfully disagree. In
my view, an essentially voluntary approach, coupled with 'general duty'
enforcement that has not worked in the past, simply is not a sufficient
response. However, I agree that an ergonomics standard should not place an undue
burden on businesses."
Moody's assessment of
North Carolina's economic condition
“The
state's underlying economy and finances remain sound and a return of economic
growth with adoption of key budget actions should enable the state to
reestablish its historic level of credit quality. The outlook for the state is
stable. North Carolina has suffered a series of adverse economic and fiscal
events in the form of costly legal judgments related to tax policy, costs for
the emergency response and rebuilding in the wake of hurricanes and floods, and
revenue loss resulting from the national economic recession and the bursting of
the stock market bubble. In addition, the state experienced revenue erosion from
sizable multi-year tax reductions, while spending pressures were rising.
“The state has taken prompt and aggressive actions to address its budget
shortfalls, using its strong executive branch powers to control spending. It
also raised new revenue by raising taxes. However, it has also continued to rely
heavily on non-recurring budget actions to fund rising costs, and has drawn down
its formal rainy day reserves.
“Despite strong efforts to meet these financial challenges, audited financial
results show that the state has been running operating deficits for the last two
years and are expected to be negative for fiscal 2002, and once positive
accumulated GAAP fund balances have turned negative. This negative general fund
condition is likely to persist in the current year and, depending on the outcome
of pending debate, next year as well. The state is currently still in budget
deliberations, and Moody's expects it will take the necessary actions to address
its significant current revenue shortfall and meet its constitutional balanced
budget requirement for this fiscal year. At this time, however, some measures
currently under consideration to reestablish structural balance in the long term
remain politically sensitive and uncertain. These include a sales tax increase
and a state lottery.
“At Aa1, the state's credit position is still strong. Flexible cash reserves
outside the general fund are ample, and North Carolina does not need external
cash flow borrowing to meet seasonal liquidity needs. A transition of the North
Carolina economy from a low wage manufacturing economy to a knowledge-based
economy has been underway for many years and is expected to continue to raise
income levels and fiscal capacity once the national economy recovers. Debt
levels are low and pension funding is exceptionally strong.”
"North Carolina has needed to tap into its
available balances over the last several years to address major one-time
expenditures and replace lost revenue. The Rainy Day Fund was drawn down from
$522 million in 1999 to $125 million at the end of fiscal 2002. Audited
unreserved general fund balances have also been decreasing steadily over the
last few years, from positive $445 million in 1998, reaching negative balances
in 2000 and 2001 and expected for 2002.
"State tax collections came in approximately $141
million below budget estimate in fiscal year 2000, a shortfall that was
addressed through expenditure reductions including the temporary delay in the
payment of certain tax refunds. These payments were processed shortly after the
start of the fiscal year 2001, in turn contributing to the deficit in fiscal
2001. The state experienced a revenue shortfall of $589.5 million in fiscal
2001, also resulting from a continued slowdown of the state's economy and tax
cuts over the last several years. In response, the Governor declared a state of
emergency and instituted a number of actions to assure that the state met its
constitutional requirement to balance the budget. Constitutionally, the governor
can tap resources from other funds, through an Executive Order, to balance the
budget should the state face revenue shortfalls. North Carolina maintains a
healthy $1.2 billion in cash balances through various non-general funds
available for this purpose.
"General Fund tax revenue collections continued to
be weaker than expected for 2002. Collections were 10.6 percent under budget,
totaling $1.56 billion, and unreserved general fund balances remained negative.
In anticipation of a significant budget shortfall for the year, the Governor
issued a second Executive Order in February, identifying $1,320.8 million of
available resources. These included a 7% reduction of Agency expenditures, the
suspension of budgeted appropriations, the suspension of local revenue sharing
and tapping the Rainy Day Fund. These resources, held in an escrow account,
would be released for their original purpose should they not be needed to
balance the budget. As of July 30, 2002, the Rainy Day Fund totaled $125
million.
"Budget problems persist into fiscal 2003.
Recognizing revenue weakness, the fiscal 2003 budget is built upon the very
conservative revenue assumption of 0% (baseline) to 1.8% (including revenue
enhancements) over fiscal 2002. Revenue enhancements, non-general fund transfers
and spending cuts are all necessary to balance the fiscal 2003 budget.
"While the budget has still not been passed,
proposals under consideration include significant agency reductions as well as
highway trust fund transfers, the use of tobacco settlement funds and the
suspension of local government reimbursement. In addition, the Governor has also
proposed introducing a lottery and maintaining the ½ cent sales tax, which was
scheduled to transition to a local source in July 2003, at the state level. To
compensate, another ½ cent sales tax increase, to be levied at the local level,
has been proposed. While these two measures would help the state transition back
into structural balance over the longer term, their political viability remains
uncertain at this time.
"North Carolina has conservatively managed its
debt issuances, reflecting the State Constitutional provision that limits the
General Assembly's ability to incur debt. The Constitution stipulates that the
total amount of legislatively authorized borrowing in any biennium is limited to
two-thirds of the amount of debt paid down in the preceding biennium. Voters
must approve any bond authorization above the two-thirds limit. All state debt
is general obligation, structured for a rapid rate of retirement.
"
While historically moderate, the state's net tax
supported debt outstanding has increased significantly over the last three
years. It rose from $1.6 billion in 1996 to $3 billion in 2002. Despite the
sizeable increase in debt outstanding over the last several years, the state's
debt burden ranks among the lowest in the nation. The state's $375 debt per
capita and 1.4% debt as a percentage of personal income in 2002, are still well
below the national medians of $573 and 2.3%, respectively.
"
Voters have authorized a $3.1 billion general
obligation bond issuance to expand and modernize the physical plant of both the
University of North Carolina system and the state's community colleges. The $3.1
billion bond authorization represents the largest debt authorization in the
state's history, and depending on the pace of issuance, will push the state's
debt burden closer to the national median as it is issued in the coming
years."
The NCCBI master calendar of meetings and events
AUGUST
19
Monday
9:00 - 11:00 a.m.
NCCBI
Council of Associations, Capital Associated Industries
19
Monday
2:00 - 4:00 p.m.
Legal Issues & Workplace
Policies Committee, NCCBI Boardroom
23
Friday
10:00 - 2:30 p.m.
Young
Executives Forum Meeting, Grandover Resort, Greensboro
28
Wednesday
2:00 - 4:00 p.m.
Health
Care Committee, NCCBI Boardroom
SEPTEMBER
4
Wednesday
10:00 a.m.
NCCBI Executive Committee, Angus
Barn, Raleigh
4
Wednesday
9:30 a.m. - noon
Small Business Advisory Board
meeting, Angus Barn, Raleigh
4
Wednesday
11:45 a.m.
Triangle Area Meeting, Angus Barn
5
Thursday
11:00 a.m.
Council of Local Chambers, NCCBI
Boardroom
9
Monday
2:00 - 4:00 p.m.
Economic Development Committee,
NCCBI Boardroom
11
Wednesday
2:00 - 4:00 p.m.
Tax & Fiscal Policy Committee,
NCCBI Boardroom
16
Monday
2:00 - 4:00 p.m.
Transportation Committee, NCCBI
Boardroom
19
Thursday
2:00 - 4:00 p.m.
Education Committee, NCCBI
Boardroom
26
Thursday
5:30 p.m.
Rocky Mount Area Meeting Reception,
Benvenue Country Club
27
Friday
10:30 - 1:00 p.m.
Environmental
Concerns Committee meeting, NCCBI Boardroom
30
Monday
7:30 a.m.
Asheville Area Meeting Breakfast,
Grove Park Inn, Asheville
30
Monday
11:45 a.m.
Boone Area Meeting Luncheon,
Broyhill Inn
OCTOBER
1
Tuesday
11:45 a.m.
Charlotte Area Meeting Luncheon,
Charlotte Marriott City Center
1
Tuesday
5:30 p.m.
Salisbury Area Meeting Reception,
Salisbury Country Club
3
Thursday
2:00 - 4:00 p.m.
Health Care Committee, NCCBI
Boardroom
7
Monday
5:30 p.m.
Greensboro Area Meeting Reception,
Grandover Resort
8
Tuesday
7:30 a.m.
High Point Area Meeting Breakfast,
String & Splinter
8
Tuesday
11:45 a.m.
Winston-Salem Area Meeting
Luncheon, Salem College
8
Tuesday
2:00 - 4:00 p.m.
Economic
Development Committee, NCCBI Boardroom
8
Tuesday
5:30 p.m.
Statesville Area Meeting Reception,
Statesville Civic Center
10
Thursday
2:00 - 4:00 p.m.
Education
Committee, NCCBI Boardroom
15
Tuesday
11:45 a.m.
Moseley Area Meeting Luncheon, Elon
University, Mosley Center
16
Wednesday
2:00 - 4:00 p.m.
Tax & Fiscal Policy Committee,
NCCBI Boardroom
21
Monday
5:30 p.m.
Greenville Area Meeting Reception,
Hilton Greenville
22
Tuesday
11:45 a.m.
New Bern Area Meeting Luncheon,
Riverfront Convention Center
22
Tuesday
5:30 p.m.
Kinston Area Meeting Reception,
Kinston Country Club
23
Wednesday
11:45 a.m.
Fayetteville Area Meeting Luncheon,
Holiday Inn Bordeaux
23
Wednesday
5:30 p.m.
Wilmington Area Meeting Reception,
City Club at deRosset House
24
Thursday
11:45 a.m.
Southern Pines Area Meeting
Luncheon, Mid Pines
24
Thursday
2:00 - 4:00 p.m.
Transportation Committee, NCCBI
25
Friday
10:30 - 1 p.m.
Environmental Concerns Committee
meeting, NCCBI Boardroom
28
Monday
2:00 - 4:00 p.m.
Legal Issues & Workplace
Policies Committee, NCCBI Boardroom
29
Tuesday
11:45 a.m.
Hickory Area Meeting Luncheon,
Holiday Inn Select
30
Wednesday
11:45
a.m.
Elizabeth
City Area Meeting Luncheon, Pine Lakes Country Club
NOVEMBER
14
Thursday
6:00 p.m.
N.C.
Business Hall of Fame Dinner, Hilton, Charlotte
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