NCVA Legislative Report
Last week the House and Senate passed HB 196-Covid-19 response & Relief. This bill distributes $1.7 billion of Federal fund in additional relief funding to communities across the state. The bulk of the money will go for testing, tracing and prevention as well as money for public education. There is also some money in the bill for small business grants.
NCVA is monitoring both Senate Bill 104 and Senate Bill 112. Each of these bills seek to eliminate the addback requirement for business expenses deducted to the extent the payment results in forgiveness of a covered loan under the Federal Cares Act. The income associated with the forgiveness is excluded from gross income. The only difference in the two bills is that Senate Bill 112 is for tax year 2020 only. These bills should help many NCVA members if passed so CONTACT YOUR MEMBER TODAY to encourage support by visiting the NCGA look up – FIND MY LEGISLATOR HERE
Current Bill Status
North Carolina does enjoy a budget surplus this year because of a lack of a new budget last year. The legislature quite possibly will look at some tax relief this year. They may not, however, elect to give relief as provided for in SB 104 and SB 112. Tax bills are generally generated out of the Finance Committee.
Also, Senate Bill 138 is of interest to corporations in general. This bill would allow for shareholder meetings to be conducted by means of remote communication if directed to do so by the board of directors unless such a meeting is prohibited by the articles of incorporation or bylaws.
I will continue to update NCVA members on the progress of these bills as well as others as they are filed.Please do not hesitate to contact me about these or any other legislative issues. Thank you. Dick Carlton-Legislative Council
Richard H. Carlton
Law Office of Richard H. Carlton, PLLC
150 Fayetteville St., Ste. 1130
Raleigh, N. C. 27601
CLICK HERE to find a letter that NAMA sent to all 50 Governors encouraging them to consider social distancing protocols for office breakrooms that allow them to safely operate when re-opening their states for business. The letter includes proposed language that Governors can easily include in re-opening orders and/or guidance. This is part of our continued effort to support the convenience services industry while it provides valuable services in a safe manner during these unprecedented times.
Governor Roy Cooper and NCDHHS Secretary Mandy Cohen urge North Carolinians to stay at home if they can and maximize social distancing. People who feel sick and have mild symptoms, should stay home and call their doctor. Businesses are encouraged to get social distancing, telework plans in place immediately. Read more. Several counties and cities are issuing
Click here to access NAMA’s State Government COVID-19 Response Order Tracking.
Click here to read the Governor's executive order is in effect now until April 23 at midnight.
Click here for a copy of the Department of Homeland Security’s Guidance on the Essential Critical Infrastructure Workforce.
NAMA has a wealth of information in one spot for COVID-19.
CLICK HERE to stay informed.
NCVA Legislative Report
The pace at the General Assembly has certainly picked up this week as more bills have been filed and more bills were heard in committee and on the floor. Much time is being spent on developing a budget and figuring out what the response to the Governor's proposed budget will be.
I have been spending a lot of time on trying to anticipate what may be introduced that may effect our NCVA members. The rumor was that a plastics bill was going to be introduced this session. The could have a great effect on our industry, especially beverages. I will monitor this situation until we get past the bill filing deadline.
Senate Bill 86-Small Business Healthcare Act) has passed the Senate and is moving to the house. This bill will allow business associations to obtain group health insurance for their members in accordance with the newly issued federal rules. This bill should make it easier for small businesses to be a member of a qualified group and get better insurance rates for their employees.
Micromarkets-It is good that Canteen has that nice micromarket in the Legislative Building as we are looking at current NC regulations for that type of business. We need to get a NCVA subcommittee to work on this issue and review the success of the Virginia legislation and regulations and see if those changes may be applicable to NC. We need to see if any of the current NC regulations or taxes on micromarkets are unduly burdensome. This may be a long process because of the nature of the micromarket business.
There will be a Revenue Laws bill this session and it will begin in the House. It should come out in a couple of weeks. I do not feel that it will attempt to address individual industry tax provisions so we should be ok on that front. The bill may even help in that it may try to further reduce the tax burden on industry by maybe doing away with or reducing the franchise tax. I will continue to closely monitor that situation.
NCVA Legislative Report
The General Assembly has met since the end of January and have considered many bills. The drama in Raleigh is that the Governor vetoed the Budget bill and the Legislature is trying to figure out what to do now. That is why the end of the session cannot be accurately forecasted. It could last just a couple of more weeks or drag out until the fall. Several bills being considered are of interest to the NCVA. I reported on these at the Board Meeting of NCVA at the recent meeting in Wrightsville Beach.
The following is a review of the relevant legislation:
HB 823 - NC Managing Environmental Waste Act of 2019. This bill was filed by the sponsor to reduce the use of plastics including single-use plastics. The bill was amended to change the definition of single-use so it does not include the recyclable beverage bottles. The bill as amended passed the House, but it is now sitting in the Senate Rules Committee. With the possible end of the session near, it does not look like the bill will move this session.
HB 927 - Ban Certain Polystyrene Products. An Act to Ban Certain Expanded Polystyrene Products in North Carolina. These products include food containers, plates and hot and cold beverage cups. This bill is sitting in the House Environment Committee and has not been heard this session, so it is most likely dead.
SB 523 is the annual Revenue Laws changes bill. This bill make some change to GS Sec. 105-164.16 but does not touch item (50) which is the provision that addresses the sales tax for items sold through vending machines.
All of the local meal and food tax bills retain the exemptions of G.S. 105-164.13 and all retail sales through or by means of vending machines.
SB 86 - Small Business Health Care Act. Allows for small businesses to participate in associated health plans with other entities so as to get better rates. A sponsoring association shall be treated as an employer of a single group health plan under the Employee Retirement Income Security Act of 1974. This is making its way through both the House and Senate and stands a good chance of becoming law.
We have been looking at the potential regulation of micro-markets in NC; and whether NCVA should be proactive in seeking legislation like was done in Virginia. I think that we should select a NCVA working group to discuss this further and decide whether draft legislation should be done so that it could be considered in the upcoming short session of the General Assembly. Patrick Shaw has already been gathering information on this issue.
NC General Assembly Report
Richard Carlton reports that Governor Pat McCrory made his first State of the State Address Monday night [February 18th] before a joint session of the House and Senate. He stated that his focus would be on the economy, education and efficiency in state government. He specifically mentioned the need to modernized the State's tax code. The Senate leadership has already stated that it plans to introduce a tax reform package. It is doubtful that they will be able to pass a new law that will provide for sales tax on a variety of services. This was originally their stated goal. They do want to lower state income tax for individuals and corporations.
The Governor and the Senate both are saying, however, that we should do away with all tax loop holes and tax preferences. This is where our vending tax law may come into jeopardy. I am monitoring this situation on a daily basis and will keep our board informed on this issue. I have also been in contact with the N.C. Beverage Association, and we are going to continue to work together on this issue.
During this week and last, the legislature has been holding joint appropriation committee meetings covering all aspects of the State budget. The Senate will be the first chamber to pass a budget this session, and they will then send it over to the House. The early word is that there is going to be no new revenues available for any new programs. At least there does not appear to be any less revenue. I do not anticipate the legislature trying to raise revenue by raising fees.
There have not been many substantive business bills introduced thus far, but that should change shortly. The bill deadline in the House is March 28 to bill drafting and a filing date of April 10; and March 15 to bill drafting and a filing date of March 28 in the Senate. The cross over deadline is May 16.