SEPTEMBER 27, 2002 * ISSUE NO. 17 * 2002 Short Session The Legislative Bulletin is published weekly by NCCBI exclusively for its members Index of stories below: More details emerge on the budget... Houses approves public financing of appellate court rates... Compromise allows passage of toll roads legislation...Amended economic stimulus bill emerges from Senate panel... Senate approves subsidiary dividends legislation... Workplace fatalities drop 13% in state... IRS cuts car-expense deduction... Cosmetics maker creates 500 new jobs in Rocky Mount...Calendar of events... This and past issues of the Bulletin going back to 1998 can be downloaded from the NCCBI web site at http://www.nccbi.org/Legislative_Bulletin/index.htm

Legislature agrees to allow local governments
to levy extra half-cent sales tax starting Dec. 1
Bowing to heavy pressure from mayors and county commissioners who jammed the Legislative Building this week, the House on Tuesday voted 58-54 for final passage of legislation allowing counties to raise the local option sales tax by a half-cent starting Dec. 1, six months earlier than planned. The Senate followed suit Wednesday by a vote of 28-15, with the votes in both chambers largely along party lines. S. 1292 Local Sales Tax Acceleration, which emerged from a conference committee on Monday, says counties can implement the levy without a referendum, allowing them and the cities they will share the revenue with to recover more than half the $330 million in state reimbursements for repealed taxes cut from this year's budget. Estimates are that the additional half-cent will produce $188 million if all counties implement the levy. Local government officials said they would be forced to raise property taxes or cut services if they didn't get some relief from Raleigh. The Dec. 1 date for implementing the local option sales tax is notable in that it falls after the November general election and before the peak Christmas shopping season. See "How They Voted" below. 

The combined state and local sales tax rate of 6.5 percent in most counties -- 4.5 percent state, 2 percent local -- will rise to 7 percent in counties that choose the half-cent local option but will fall back to 6.5 percent on July 1 when a half-cent of the state's share is scheduled to expire. Under legislation passed last year to help close a yawning budget gap, the half-cent local option sales tax was to begin simultaneously with the end of the half-cent state tax. However, some now are questioning whether the state will stick by its plan to allow its half-cent to expire on July 1. With the current budget propped up by more than $800 million in non-recurring revenue and other gimmicks, many are wondering whether the state can afford to give up the $363 million in revenue that the extra half-cent raises.

In a related development, legislation passed two weeks ago by the legislature barring the state from seizing local government revenue -- as the governor did with the repealed-tax reimbursements, became law without Gov. Mike Easley's signature. H. 1490 Secure Local Revenues was ratified by the legislature and presented to the governor Sept. 13.  It went into effect by default at midnight Monday. Easley said he did not sign the legislation because he has doubts about its constitutionality.

More details emerge on the budget as legislators begin eyeing adjournment
As of Thursday night Gov. Mike Easley still had not signed the compromise budget legislators sent him last Friday. If he doesn't sign or veto it, the budget becomes law on Monday. But while the governor was dawdling, the House and Senate were making restless preparations to leave town, and House Speaker Jim Black said he hopes to adjourn by the end of next week. Black said the only remaining item of important business before the House was the economic development incentives legislation (see story below). Also, under the continuing budget resolution legislators passed last month, legislators can't collect their $104 per diem money after Sept. 30. Legislators also are itching to get out on the campaign trail and begin leaning on lobbyists for campaign contributions, which they can't do during session.

But with the end in sight to a short session that began in May, legislators weren't popping champagne corks this week because reality is beginning to set in about how tough next year's budget will be. House and Senate leaders acknowledge that they used every available trick to cut spending and raise revenue for the $14.34 billion budget, including using more than $800 million in nonrecurring revenue, money that won't be available next year. Estimates now are that next year's budget gap may approach $1.5 billion, given anticipated school enrollment growth and increased Medicaid costs -- the same budget line items that ate up almost all the $600 million in new spending in this year's spending plan. The new budget is based on a conservative 1.7 percent estimated growth in tax revenues and uses an additional $90 million in higher business taxes. Other budget highlights:

North Carolina became the 49th state to adopt a budget for the current fiscal year when it approved a revised spending plan last week, nearly 10 weeks late. We would have been 50th except Kentucky's legislature adjourned without adopting a budget, according to the National Association of State Legislatures.

The new state budget requires state agencies to cut at least 1,835 full-time positions, but the number of job cuts undoubtedly will rise as agencies trim spending to comply with a budget directive to produce an unspecified $55.6 million in operational savings in coming months. The Department of Corrections got the biggest hit, a cut of $70.4 million in spending and a loss of 366 jobs. Of the 1,835 eliminated jobs, 782 are filled positions, 974 are vacant and 79 will be paid for with non-tax money, according to legislative analysts.

Provisions in the versions of the budget passed by the House and Senate directing the UNC System to create a pharmacy school at Elizabeth City State University, a biotechnology degree at Winston-Salem State University and engineering programs at East Carolina, Western Carolina and UNC Asheville were dropped from the conference committee report.

The budget gives the Joint Legislative Commission on Governmental Operations limited oversight on the proposed executive hotel and conference center that N.C. State University hopes to build on its Centennial Campus. That's a weaker response than previously approved and comes after NCSU trustees approved a scaled-down version of the complex by dropping plans for an outdoor swimming pool, a spa and executive suites. Trustees also softened the $60 million price tag by specifying that it should not require additional appropriations from the state for operational costs. The budget says NCSU must give the House-Senate panel all plans for the facility, including debt service plans, before borrowing money or signing a contract. The university will sell bonds to pay for the facility, which it hopes to open in 2005.

The House's offer to cut legislative salaries by 10 percent and save $272,000 a year was dropped from the final budget.

The community colleges are happy with how they were treated in the budget because legislators appropriated $51.8 million to reimburse local campuses for costs they incurred when enrollments shot up last fiscal year. System President Martin Lancaster said, "This was the most critical item required if the NCCCS has any chance of maintaining quality services for the nearly 800,000 students now attending community colleges in North Carolina." However, the budget directs the State Board of Community Colleges to reduce overall spending by $5 million but gives the board the discretion to decide where to make the cuts.

Public radio stations at three community colleges -- Gaston, Craven and Isothermal -- won't go silent because of last-minute appropriations tucked into the budget. The spending plan gives $100,000 each to the stations at Craven and Gaston and $135,000 to the station at Isothermal Community College in Rutherford County. 

A complete line item look at the new budget is at the end of this newsletter.



House passes landmark bill creating public financing of appellate court elections
The House on Thursday voted 57-55 to pass landmark legislation removing politics from state Court of Appeals and Supreme Court races and creating a system of public financing for candidates for those offices. S. 1054 Judicial Campaign Reform Act, sponsored in the Senate by Durham Democrat Wib Gulley, now goes back to the Senate for concurrence in amendments, which seems likely. Like similar laws passed in recent years covering District Court and Superior Court elections, the measure makes Court of Appeals and Supreme Court races nonpartisan. Beginning in 2004, candidates for the appellate courts would not be identified as Republicans or Democrats. But this bill goes much further than the others by creating the North Carolina Public Campaign Financing Fund that will receive $3 from each taxpayer who checks a box on their state income tax return. Estimates by the General Assembly's Fiscal Research Division are that the fund would have $680,000 to distribute to candidates for the 2004 election and $1.9 million for the 2006 elections, including money from the $3 checkoff box on tax returns and $50 voluntary contributions from lawyers when they renew their privilege licenses.

Candidates for the Court of Appeals and Supreme Court would have to agree to several limitations to quality for public financing, however. Significantly, they couldn't accept any contribution larger than $1,000, or $2,000 from a family member. To trigger access to the fund, candidates first would first have to raise money from at least 350 supporters totaling no more than $69,000. Court of Appeals candidates who abide by the restrictions would then qualify to receive public financing equal to 125 percent of the salary for the office, or $138,200. Supreme Court candidates would receive 175 percent of the salary for the office, or $201,800. Candidates would not be required to use public financing and would be free to raise as much as they could from supporters. In those cases, their opponents could get as much as $600,000 in public money from a "rescue fund."

The $3 checkoff box as the main funding mechanism surfaced after opponents on Tuesday defeated, by a vote of 60-58, the bill's original idea of having a $1 "negative checkoff" box on income tax returns -- meaning that if taxpayers didn't check the box then $1 of their tax payment would automatically go into the fund. House Republicans generally oppose the concept of nonpartisan judicial races because they say it will hurt their candidates for those offices, who generally have done well in recent elections.

As part of its "good government" positions, NCCBI for years has supported efforts to remove politics from judicial elections but has opposed using taxpayer money to fund campaigns. NCCBI's preference is for gubernatorial appointment of appellate judges, with voter retention elections.


Compromise allows passage of toll roads legislation
Toll roads legislation, which recently appeared to be out of gas in the General Assembly, sped ahead this week after House and Senate conferees reached a compromise on exactly many such roads can be build. The compromise version of H. 644 Toll Road Bridge Authority Created (Jim Crawford) specifies that the new authority can go ahead with plans to build three toll roads and begin studying locations for three more. The House accepted the conference committee report by a vote of 74-33 on Tuesday following a 32-8 vote by the Senate Monday night. Versions of the legislation passed earlier by the House and Senate disagreed on how many toll roads could be built, and whether existing roads could be converted to toll roads. The final version specifies that no existing road can be converted to a toll road. The compromise also specifies that one of three toll roads that can be immediately considered must go in an area with a population of more than 650,000. Another must go in an area with a population of less than 650,000, which sponsors said probably would be a road linking Union and Mecklenburg counties. The third road could go anywhere in the state. Additionally, the N.C. Turnpike Authority can begin the planning process for three additional roads but must obtain legislative approval before beginning actual construction on them. The authority will be governed by a nine-member board, with five appointed by the governor and two each by the Speaker of the House and the President Pro Tem of the Senate. The turnpike authority has the power to condemn land and issue bonds to pay for the roads, with toll revenue paying off the bonds. The legislation says that tolls would end once the bonds are retired and a maintenance fund was established for the road.


Amended economic stimulus legislation emerges from Senate panel
The Senate Finance Committee on Wednesday favorably reported a new version of H. 1734 N.C. Economic and Job Stimulus Creation, the House-passed measure that represents the first major overhaul and expansion of the state's economic development policies in several years. The bill, sponsored by Rep. Bill Owens (D-Pasquotank), now goes to the Senate floor. As we have previously reported (see the July 19 and Aug. 2 issues of the Legislative Bulletin), the legislation mainly allows the state to target recruitment efforts on specific expanding or relocating companies by offering them cash payments of up to 75 percent of the state income taxes paid by workers in those new jobs. 

In her testimony to the committee, Vice President of Governmental Affairs Leslie Bevacqua said NCCBI supported the incentives bill as it passed the House and noted that the Senate added provisions to the bill that the association believes will enhance economic development and job training in the state. “We believe this legislation will enhance economic development and job training in the state. We are in a very competitive environment nationally and internationally competing for jobs and for new and emerging industries to locate and expand in North Carolina. This legislation will give our state additional tools to recruit new industry and new jobs,” Bevacqua said.

Other speakers supporting the bill included N.C. State Chancellor Marye Anne Fox; UNC-Chapel Hill Chancellor James Moeser; N.C. Community Colleges President Martin Lancaster; Gary Salamido with Glaxo Smith Kline; Hal Price with Biogen; Ken Tindall with the N.C. Biotechnology Center; and Sam Taylor, representing the N.C. Biosciences Organization.

The version of the bill approved by the Senate Finance Committee scales back the amount allocated for a job development grant program and uses funds from the national tobacco settlement for a cancer center at UNC Chapel Hill and a biotech training center at N.C. State. The Job Development Investment Grant Program allows a five-member committee (consisting of the Secretary of Commerce, the Secretary of Revenue, the Director of the Office of State Budget and Management, one member recommended by the Speaker of the House and one member recommended by the President Pro Tem of the Senate) to award grants to recruit businesses to North Carolina. The amount of the grants would be based on income tax withholdings from new jobs created by the businesses. The amount of the grants were scaled back from the House version from a total of 25 agreements allowed per year to 15, and the total cost was reduced from $15 million to $10 million a year statewide. Tougher provisions also were added by the Senate Committee so that the state could reclaim grant money if a company fails to create the jobs promised or comply with other parts of the agreement.  

The Senate’s version of the bill authorizes the state to issue special obligation settlement bonds (maximum of $175 million) for construction of a new cancer rehabilitation and treatment center to be located at UNC Hospitals and construction of a new biopharmaceutical/bioprocess manufacturing training center to be located at N.C. State University. The training center would be assisted by six newly recreated regional community college training centers located throughout the state. A Travel and Tourism Capital Incentive Grant Program would also be established in the Senate version to award grants to the owners of qualified projects for the purpose of encouraging the creation of new or the expansion or renovation of existing travel and tourism projects. House leaders have indicated they will not support the Senate version because of the various changes and additions made to the bill.  


Senate approves subsidiary dividends legislation
The Senate gave unanimous second- and third-reading approval Wednesday to H. 1670 2002 Fee Bill Subsidiary Dividends, the measure clarifying the expense attribution law as it applies to deductible dividends. The bill, whose passage was ruled a non-roll call vote, impacts how companies write off expenses related to nontaxable income they receive from subsidiaries. On Thursday, the House Committee on Finance recommended concurrence in the Senate amendments. The bill is calendared for hearing by the full House on Tuesday. The legislation is intended to correct interpretation of a law passed last year that tightened how companies expense nontaxable income from subsidiaries. That law, passed to conform state law to federal rules for the deduction of dividends received, was expected to raise business taxes by $32 million a year but the Revenue Department's interpretation of the law resulted in an $82 million increase, mainly on banks. H. 1670 would result in $82 million in business taxes in the current year, but lower the liability to an estimated $59.9 million next fiscal year and to an estimated $62.9 million in fiscal 2004-05, according to figures from the General Assembly's Fiscal Research Division. The legislation, which now goes to the House for concurrence in amendments, also caps an individual bank's liability at $11 million.

Representatives from NCCBI, the North Carolina Bankers Association and others have been working for several weeks with the Department of Revenue and legislative leaders to reach a consensus on this issue. Because of confusion over the law enacted in 2001, the bill was proposed to provide clarity to the expense attribution law as it applies to deductible dividends and provides limits on the additional tax liability. In addition to clarifying language for the 2001 and 2002 taxable years, the bill directs the Revenue Laws Study Committee to study the treatment of expenses related to dividends received and other income not taxed and the taxation of affiliated corporations, of holding companies and of financial institutions under current law. The committee is to report its recommendations to the 2003 General Assembly. Penalties for late filing by corporations under this section of the law will be waived if companies file and pay amounts owed to the state within 15 days of the date the act becomes effective.

Panel urged to go slow on raising workers' comp awards schedule
Legislation was presented to the House Judiciary II Committee on Tuesday to adjust the worker’s compensation award schedule. In a committee substitute for S. 752 Adjust Workers’ Comp Award Schedule (Frank Ballance), legislation was proposed to increase the scheduled maximum amounts under the Workers” Compensation Act for the following:

In case of serious facial or head disfigurement, increase the maximum from $20,000 to $50,000.

In case of serious bodily disfigurement, where no compensation is otherwise available under the schedule section, increase the maximum from $10,000 to $25,000.

  In case of loss of, or permanent injury to, any important external or internal organ, where no compensation is otherwise available under the schedule section, increase the maximum from $20,000 to $50,000.

If adopted the law would apply to all claims that are pending on or are in litigation after the date of ratification.

Speaking on behalf of the N.C. Association of Defense Attorneys and a host of businesses, including NCCBI and associations opposed to the change, Bob Kaylor noted that this legislation needed to be looked at in the overall context of current law relating to worker’s compensation and suggested that instead of moving forward hastily on this change, the General Assembly should instead consider a study involving all interested parties, including the business community, the Industrial Commission, the trial lawyers, claimants and others. No action was taken on the bill.

In addition to NCCBI, companies and associations opposed to the change as presented to the committee include: Alcoa, Alliance of American Insurers, American Insurance Association, Burlington Industries Inc., Carolina Associated General Contractors, Duke Energy, International Paper, KoSa, Laboratory Corporation of America, Manufacturers and Chemical Industry Council of North Carolina , North Carolina Association of Defense Attorneys, North Carolina Association of Self-Insurers, North Carolina Farm Bureau Federation, North Carolina Forestry Association, North Carolina Home Builders Association, North Carolina Retail Merchants Association, Progress Energy, R.J. Reynolds Tobacco Company, and Weyerhaeuser.

Committee Actions and Floor Votes

The House on Tuesday gave third-reading approval to H. 1720 Wilmington Occupancy Tax (Thomas Wright), a measure specifying that, once New Hanover County has created a Tourism Development Authority, then Wilmington may levy a 3 percent hotel occupancy tax, with the proceeds going toward the cost of constructing a convention center. Also Tuesday, the House gave third-reading approval to a related bill, H. 1707 New Hanover Beach Towns Tourism Act (Danny McComas). The measure establishes the tourism development authority and creates a 3 percent hotel occupancy tax in Carolina Beach, Kure Beach and Wrightsville Beach. It also specifies that if a convention center is built, it cannot be in partnership with an adjacent hotel in which the hotel would be required to pay fees for providing accommodations to convention goers. Both bills now go to the Senate.

The Senate on Wednesday gave second-reading approval to H. 1665 Interstate Air Couriers - Bill Lee (Lyons Gray), the House-passed measure that extends the deadlines for FedEx to receive tax credits for the air cargo hub planned for Piedmont Triad International Airport.

The Senate on Wednesday gave second- and third-reading approval  favorably reported H. 1519 Motor Carrier Safety Amendments (Jim Crawford), a measure that requires the DMV to refuse to issue a title for and to cancel the registration of any vehicle owned by a motor carrier that is determined to be an imminent hazard. A motor carrier would be so designated if it's been ordered by the Federal Motor Carrier Safety Administration to cease all operations or is otherwise deemed by authorities to be a safety risk.

The Senate on Wednesday gave second- and third-reading approval to H. 1100 Financial Fraud Protection/Enhancement and the measure was returned to the House for concurrence in amendments. The bill, proposed by Attorney General Roy Cooper, would beef up a 1999 state law that made financial identity fraud a crime. H. 1100 extends that by outlawing trafficking in stolen identities, toughening sentences against criminals who commit ID theft and authorizing judges to order convicted ID thieves to pay restitution. It also gives victims the right to pursue civil action against an ID thief whether or not the thief has been prosecuted for criminal violations.

By a vote of 26-24, the House Appropriations Committee on Thursday refused to favorably report legislation to use sales and privilege taxes to help local governments build arenas and convention centers. The 26-24 vote against H. 1751 N.C. Tourism Development Act (Beverly Earle) capped two days of debate in the committee. The bill, which technically remains alive, would allow local governments to finance arenas and convention centers using state grants representing 25 percent to 35 percent of the sales and business privilege taxes generated by the facilities, up to $20 million a year for 10 years. A similar proposal is also part of a larger incentives bill in the Senate.
     


State Government News
Workplace fatalities drop 13 percent, best improvement since 1995
The number of North Carolinians killed on the job fell by 13.2 percent in 2001 from the previous year, the single biggest decline in workplace fatalities since 1995, the state Labor Department said. The drop from 234 fatalities in 2000 to 203 in 2001 reflects improvements in almost every major category that is included in the department's annual report. "We're encouraged," said Labor Commissioner Cherie Berry. "we're very mindful of the lives that were lost, but we're encouraged by the fact the numbers are dropping. We're going in the right direction." Of note, the number of Hispanics killed on the job decreased from 22 to 20 last year even though their numbers in the workplace continue rising rapidly. Last year the department created an Hispanic Task Force to come up with measures to improve workplace safety for Hispanic workers.

Of the 203 on-the-job deaths last year, 124 were people killed in transportation-related accidents. In specific job categories, the agriculture, forestry and fishing industry experienced 17 fatalities compared to 27 the year before. Manufacturing lost 24 workers compared to 32 in 2000. Workplace deaths in the transportation and public utilities fields fell to 32 from 40 the previous year. However, the construction industry saw an increase to 51 from 45.

Berry, the first woman ever elected Labor commissioner, said workplace safety programs also have gained impetus from a growing awareness among employers of the huge costs of unsafe work practices. "We've got to be innovative and look at other ways to reduce fatalities in North Carolina. I can't say this enough -- the only way we're going to do it as by working with employers and their workers. We've got a total of 114 inspectors for more than 200,000 businesses. We can't do it alone."

Nationally, 5,900 workers were killed in on-the-job accidents in 2001, according to the U.S. Department of Labor's Bureau of Labor Statistics, down from, 5,920 the year before. That number excludes the 2,866 people who lost their lives in the Sept. 11 terrorist attacks. Workplace deaths have declined each year in the U.S. for the past several years; 6,202 workers lost their lives in 1996, according to BLS data.

Unemployment rate falls by half a point
North Carolina’s unemployment rate has dropped to its lowest level in six months, falling half a point in August to 6.3 percent from 6.8 percent in July, according to the state Employment Security Commission (see chart above). The decline in the unemployment rate was due to a drop in the number of initial claims for unemployment benefits over the month, combined with a 23,700 decrease in total unemployment and a 8,200 increase in total employment. The state’s labor force also decreased by 15,500 during the same period as many students left their summer jobs and returned to the classroom. Total nonagricultural employment grew by 11,100 jobs over the month, from 3,885,500 to 3,896,600. Service producing industries had the largest growth in employment, experiencing a net increase of 12,100 jobs. The largest increases were in local government (+6,500), retail trade (+1,700), educational services (+500) and personal services (+300). Total manufacturing employment decreased slightly, losing 600 jobs over the month to fall to a total of 700,800 workers. The largest areas of decrease were tobacco products (-1,400), textiles, (-500) and food and kindred products (-400). The state paid a total of roughly $93.3 million in unemployment benefits in August, leaving a balance in the fund of about $372.1 million.

he N. C. Department of Transportation will hold a citizens informational workshop on the proposed auxiliary lanes on I-40 in Buncombe County. The workshop will be held Monday, Oct. 7, from 4 p.m. to 7 p.m. at the National Guard Armory in Asheville. DOT proposes to connect auxiliary lanes on I-40 from I-240 and I-26 to the U.S. 19-23 interchange in Asheville. DOT representatives will be available to answer questions and receive comments from the public about the proposed project.

The eastern leg of the U.S. 17 bypass around Wilmington will be designated as Interstate 140 and named after John Jay Burney Jr. Burney has served as New Hanover County attorney, a state senator and a trustee of UNC-Wilmington. Construction on the $37 million highway project was scheduled to begin this summer but has been held up by environmental problems.

Washington Watch

IRS cuts car-expense deduction to 36 cents per mile
The Internal Revenue Service recently announced that the standard deduction for operating a car for business purposes will be 36 cents a mile in the 2003 tax year, down from 36.5 cents a mile this year. The rate was determined from an annual study of the costs of operating a car and mainly was influenced by a reduction in the price of gasoline. The 36-cent-per-mile rate is the amount a taxpayer can deduct for vehicle expenses on his or her 2003 tax return for business miles driven. Taxpayers have the option of maintaining accurate records of actual operating and fixed costs attributed to the business use of their vehicles. The standard deduction is a simpler way to do the same thing. The IRS also announced these standard deductions for vehicle use: The standard mileage rate for the use of a car when giving services to a charitable organization remains at 14 cents a mile. The standard mileage rate for the use of a car for medical reasons is 12 cents a mile, down from 13 cents a mile in 2002. The standard mileage rate to use when computing deductible moving expenses is 12 cents a mile, down from 13 cents a mile in 2002.

Duke clears major hurdle for expanding natural gas pipeline
The Duke Energy Patriot natural gas pipeline project has received final environmental impact statement approval from the Federal Energy Regulatory Commission (FERC). The agency noted that construction and operation of the Patriot project, with the appropriate mitigation measures, would result in “limited adverse environmental impacts.” The Patriot project will expand the company’s existing East Tennessee Natural Gas (ETNG) system in Tennessee and Virginia, and extend the system into southwest Virginia and northern North Carolina through a new 94-mile natural gas pipeline. “We appreciate the conclusion FERC staff has given the Patriot project after this thorough environmental evaluation,” said Robert B. Evans, president and CEO of Duke Energy Gas Transmission. “As we move toward final approval, we will continue our outreach efforts with landowners and in the communities. We look forward to working with FERC and local, state and federal agencies to ensure the project meets all environmental regulations, as well as our own strict environmental standards.” Duke has asked the FERC for a final certificate this fall to meet a target date of May 2003 to begin serving customers in the new service area.

BLS says North Carolinians' incomes now second highest in Southeast
North Carolinians on average eared $32,026 in 2001, the second highest incomes in the Southeast behind Georgia, according to data released by the U.S. Department of Labor's Bureau of Labor Statistics. That's a 3.1 percent increase from the year before and higher than the 2.5 percent national increase in annual income. Still, the average annual income in North Carolina trails the national average of $36,214 by 13 percent. The figures for North Carolina look weaker on a per capita basis, largely because of the state's surging population. The state's scant 1.7 percent in per capital income in 2001, to $27,514 from $27,055 the year before, ranks 43rd in the nation. In previous years, per capita personal income had risen robustly in North Carolina, and was up 6.1 percent in 2000 from 1999. Nationally, per capita personal income gained 2.4 percent in 2001, to $30,472, the Commerce report said. Overall, North Carolina maintained its 31st ranking among the states in per capita personal income. Residents here earn 90 percent of the national average, the report said.

Federal OSHA head applauds furniture industry's voluntary efforts to reduce ergonomic injuries
Assistant Labor Secretary John L. Henshaw, who runs the federal OSHA program, applauded the American Furniture Manufacturers Association and the North Carolina Department of Labor for their new alliance designed to produce a voluntary guideline that will help furniture manufacturers reduce ergonomic hazards and injuries. "OSHA is pleased to support the alliance and provide promotion and publication of the voluntary guideline," Henshaw said. "This alliance is unique because it is the first to bring federal and state government together with industry to develop voluntary ergonomic guidelines for a specific industry. It is also the first example of a state stepping forward with an industry group to develop a voluntary ergonomic guideline based on OSHA's four-pronged approach to reduce ergonomic injuries. North Carolina is a leader in workplace safety and health issues and endorses OSHA's four-pronged approach to ergonomics. Furniture manufacturers, their employees and their families throughout the country can benefit from the collective experience of the alliance participants. I believe their example serves as an outstanding model for other states interested in reducing ergonomic-related injuries."

Economic Development
Cosmetics maker expands in Rocky Mount, creating 500 new jobs
Del Laboratories Inc., a New York-based maker of cosmetics and over-the-counter pharmaceutical products, plans to relocate the majority of its manufacturing operations to Rocky Point, which will bring approximately 500 additional jobs to the region., Gov. Mike Easley announced Monday. Construction is set to begin later this year on the new facility. The company expects operations to be fully expanded by the fourth quarter of 2003. Since 1997, the firm has maintained warehousing, distribution and re-packaging operations in Rocky Point, where it already employs a workforce of 220. Headquartered in Uniondale, NY, Del Labs manufactures, markets and distributes cosmetics and proprietary pharmaceuticals, including well-known brand names such as Sally Hansen’s Hard as Nails, Corn Silk, Naturistics and LaCross. Its products are sold in more than 30 countries. In July Del (AMEX: DLI), was added to the Russell 2000 Index that measures the performance of 2,000 small cap U.S. companies. The move came after company Chairman, President and CEO Dan K. Wassong in April reported a 20 percent increase in net sales for the first quarter of 2002, to $79.9 million compared to 2001 first quarter net sales of $66.7 million, and an increase of 175 percent in net earnings for the first quarter of 2002 to $3.5 million, or 41 cents per basic share.


NCCBI News
Robeson County interested in hiring superintendent from business world
Last year NCCBI and others persuaded the General Assembly to repeal a state law that county school superintendents have a graduate degree in education. The thinking was that there are many successful business people whose management, financial and people skills would make them excellent school superintendents. Recently, the N.C. School Board Association contacted NCCBI and asked that we make you aware of a superintendent vacancy. The association is assisting the Robeson County Board of Education in locating a new superintendent. Following is the information they sent us. Notice their interest in talking to "non-traditional" candidates.

"The Board of Education for the Public Schools of Robeson County is seeking a superintendent to lead the school system in its continuing pursuit of excellence. Candidates must meet the legal requirements for licensure as a superintendent in North Carolina or be qualified to serve under the State Board of Education’s alternative guidelines. A doctorate degree is preferred, but not required. Strong non-traditional candidates will be seriously considered.  A successful candidate will be required to live in Robeson County. Applications are due by Dec. 10, 2002.  The board hopes to make a final decision by early March 2003. A candidate must demonstrate ability and success in (1) leadership;  (2) goal setting and monitoring achievement; (3) fostering community and/or intergovernmental partnerships; (4) administration and organization of long- and short-term planning, budgeting, and personnel and facility management;  (5) strong communication and effective team-building skills; (6) grant writing and procuring additional funding; (7) visibility and involvement in community activities; and (8) leadership in maintaining safe environments. The school system includes 41 schools with approximately 23,000 students in kindergarten through twelfth grade. Applicants must complete the Board’s required form. Inquiries and requests for applications should be directed to Allison Schafer, Legal Counsel/Director of Policy, North Carolina School Boards Association, PO Box 97877, Raleigh, NC 27624-7877. Phone: (919) 841-4040.  FAX: (919) 841-4020. E-mail: aschafer@ncsba.org. All inquiries will be kept confidential."

Names in the News
School-business-community partnerships earn state honors
Small and large businesses, the faith community, chambers of commerce, various other community groups and two individuals will be recognized for their involvement with public schools when the second annual Governor's Business Partnership Awards are presented today. The awards presentation is a part of the Meet in the Middle Conference, designed to encourage stronger family, community and business partnerships with North Carolina's schools. The conference is sponsored by the Public School Forum/NC Partners, the Public Schools of North Carolina, NCCBI, the N.C. Business Committee for Education and the N.C. School Boards Association.

The Governor's Business Partnership Awards were created to recognize outstanding sustained business and alliance partnerships that have significantly improved student performance. In addition, two individuals will be recognized as outstanding local officials for their significant community impact through collaborative efforts. Joe Brown of Joe Brown Pontiac, Rockingham, and Krista Tillman, BellSouth, Charlotte, are the two individuals singled out for honors. 

Other winners are: YMCA of Greater Charlotte, Denton Area Chamber of Commerce, Lexington Area Chamber of Commerce, Northern Davidson Chamber of Commerce, Thomasville Chamber of Commerce, the Ministers' Council for Education in Perquimans County, Rocky Mount Area Chamber of Commerce, Pilot View Resource Conservation and Development Inc., Newton-Conover Education Foundation Inc., North Carolina Farm Bureau's Ag in the Classroom, IBM, Henderson County Education Foundation, Guilford Community College Tech Prep Program, Gold Kist Inc., General Electric, City of Goldsboro, Pinehurst Inc., Camden Education Foundation, Caldwell Career Ready Partnership, Wake County Business Education Leadership Council, Building Hope Community Life Center, BellSouth, Asheville High Business Alliance, Allen Tate Realtors of Monroe.

State Board of Education Chairman Phil Kirk said the awards program and Meet in the Middle Conference are closely connected with the state board's priory of strong family, community and business support of public schools. "We need everyone involved in supporting our schools, when they are at work or at home, or through their community efforts. Our goal of being First in America in education must be a shared vision with the entire community. These awards will inspire others to be more active." 

Rosemary Wyche, NCCBI vice president of development, was elected to the eight-member executive committee of the Association of Membership and Marketing Executive during the national group's annual convention. She also received her fourth national award in three years from the group. This year she received the Award of Merit for Highest Retention. In addition, Wyche was a featured speaker on the program, where she focused her comments on NCCBI's area meeting format, special membership events and board member involvement.

Larry Dagenhart, an attorney with Helms Mulliss & Wicker in Charlotte, received the Harold Josephenson Award at the World Citizen Award dinner on Tuesday. Dagenhart, who has practiced law for 42 years, is chair of the Ben Craig Center at UNC-Charlotte and heads the chancellor search committee at UNC-Wilmington.

Harlan Boyles received the A.E. Finley Distinguished Service Award at the Greater Raleigh Chamber of Commerce's 114th annual meeting Tuesday night. The award is the chamber's most prestigious honor. Steve Stroud, last year's winner, presented the award to Boyles.

Candidates: Last week we ran a list of candidates for state and federal offices who are members of NCCBI. A few others have been pointed out to us, including Harris Blake and R. B. Sloan, candidates for the N.C. Senate, and Bill McMillan, a candidate for the N.C. House. If you know of other NCCBI members who are running for office, please let us know and we will publish their names.

Replacement candidate: Mary Tate Blake of Asheboro was selected by the Randolph County Democratic Party to replace Hampton Spivey as the Democratic candidate in the 67th House District race. Blake, a former Randolph County Board of Education member, will face Republican Rep. Arlie Culp of Ramseur in the November general election. Spivey withdrew earlier for family reasons.

The NCCBI master calendar of meetings and events

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