Press Releases and Newsletters
Program Evaluation Division report to be basis for ABC change debate (Wilmington Star News)
Program Evaluation Division report to be basis for ABC change debate (Wilmington Star News)
State leaders plan to use a year-old evaluation report as the starting point for discussions on reforming the N.C. Alcoholic Beverage Control system.
The December 2008 report from the legislature’s Program Evaluation Division recommends a number of reforms for the alcohol system – which the report called “outdated” – and suggests the state explore other options for handling liquor, including privatization.
But officials say that would be a complex undertaking that shouldn’t be rushed. So while some ABC reform will likely happen after legislators head back to Raleigh in May, privatization probably won’t.
“I would be surprised if we could have an intelligent, instructive debate on it in 45 days,” said Rep. Pryor Gibson, a Democrat who has worked extensively on the state liquor laws, and despite recent problems, believes the ABC system works well for the state.
“Privatization is a big word,” he added.
Two groups – Gov. Beverly Perdue’s Budget Reform and Accountability Commission and a soon-to-be-formed legislative study committee – are looking into reforming the current system, with an eye to correcting some of the pay and ethics scandals that erupted in Wilmington and Charlotte in recent months.
Norris Tolson, co-chairman of the governor’s budget committee, said the 2008 report will likely be a centerpiece of the committee’s recommendations, which are expected in March.
That report said the ABC system needs to be modernized, specifically by better defining the missions of local boards (are profits or “controlling” sales more important?) and giving the state commission authority to set performance standards and work with local boards to increase profits.
Tolson said the governor’s committee is studying privatization, but it “has no legs under it at this point.”
Schorr Johnson, a spokesman for Senate leader Marc Basnight, said the 2008 report will also be the “starting point” for legislative efforts to reform the ABC system.
Johnson said Basnight has been working closely with House Speaker Joe Hackney to put together a study committee, and that appointments will likely be announced in a few weeks.
“Reforming the ABC system is a priority for Sen. Basnight in the short session,” he said. “He wants to look at having more oversight at the very least.”
But is privatization even politically feasible?
North Carolinians are divided whether they want privately-owned liquor stores on their street corners, according to a recent poll by the Civitas Institute.
The poll surveyed 600 likely voters, and 47 percent said keep the ABC system and 44 percent said liquor sales should be privatized, according to the results. Of those surveyed, 9 percent said they were not sure. The margin of error was 4 percent.
While many residents in Wilmington – where people are outraged by high salaries and bonuses for local ABC leaders – may clamor for privatization, there are many parts of the state that support the “control” aspect of the system, believing it helps prevent underage drinking, drunk driving and other social ills caused by alcohol.
“You cannot paint all of North Carolina with the same ABC brush,” Gibson said. “There’s not going to be any way at all to get a one-size-fits-all solution to this.”
Others support control for religious reasons.
Rev. Mark Creech, director of the Christian Action League of North Carolina, said he will fight to protect the ABC system from privatization.
North Carolina ranks 45th out of 50 states in per capita alcohol consumption, but ranks 7th in revenue generated by liquor sales, according to the ABC system’s annual report for 2008. That’s worth saving, Creech said.
“I don’t think we could have a better system than what we’ve got that strikes that balance between providing revenue for the state and also protecting the public health,” he said.
He doesn’t think privatization will be seriously considered in 2010, but it could become a major issue in the future.
Some say the largest barrier to change is plain and simple politics.
“The major obstacle to privatization is local political pull,” said John Hood, president of the John Locke Foundation, which supports privatization.
State government gives the more than 160 local ABC boards wide latitude to operate as they see fit. In many ways, local governments have much more sway over their liquor stores because they appoint the local boards.
In addition, local governments get a cut of ABC profits, which helps elected leaders at budget time when they are forced to consider unpopular tax increases.
While local governments in other states get alcohol money too, and Hood and other privatization supporters say North Carolina could devise a system to keep money flowing to local governments, any changes that create the perception that locals could lose money would make it difficult, if not impossible, for local politicians to stomach.
“Many local governments believe they get more revenue because of the control system,” Hood said. “I think its more perception than reality.”
What’s clear is that both supporters and opponents of the control system will be paying close attention. While proponents don’t believe there’s enough support to tear it down, privatization supporters say refusal to take up the issue would be a missed opportunity.
“Fundamentally, North Carolina government should not be in the liquor business,” said Hood. “What you get right now is poor service, high prices and political corruption.”
Staff writer Shannan Bowen contributed to this report.
Chris Mazzolini: 343-2223
On Twitter.com: @StarNewsOnline
By Chris Mazzolini
[email protected]
Published: Saturday, February 6, 2010 at 3:30 a.m.
Privatization of state’s ABC system is risky business (Wilmington Star News)
Privatization of state’s ABC system is risky business (Wilmington Star News)
Could a one-time windfall of up to $700 million be attractive enough to win state leaders over to privatizing North Carolina’s liquor industry?
That money could fund government projects, such as transportation needs, or supplement other aspects of the state’s budget. It would require, however, a move considered financially and socially risky by some and perhaps the most momentous change the governor’s budget reform committee could recommend.
That group, officially dubbed the Budget Reform and Accountability Commission, is researching an assortment of options for revising the state’s government controlled alcohol industry, and privatization would potentially yield the most revenue in a one-time windfall compared to other options, according to research presented to the governor in October.
Further research about all options, including reformed control policies, quasi-control and privatization, is expected to be presented to the governor at next month’s commission meeting. And, if commission members have researched other states’ methods and studies by several groups, both slanted and not, they’re likely to present ideas about privatization that rest on both ends of the spectrum.
Following the money
The most significant change in moving from a controlled model to a private one is the amount of revenue a state would bring in, said Dr. William Kerr of the Alcohol Research Group, a nonprofit organization of the Institute of Public Health charged with researching alcohol-related issues.
Kerr completed a study last year called “The Effects of Privatization of Alcohol Control Systems” at the request of the National Alcohol Beverage Control Association, which supports alcohol control systems by providing research and addressing alcohol sale and consumption policies. He said the report was unbiased and was based on research on revenues, alcohol consumption and other factors.
Kerr said a state monopoly system, such as North Carolina’s, would yield more revenue per gallon of alcohol sold compared to a licensed model. “In the absence of a dramatic tax increase, which seems politically improbable, states would lose millions of dollars in revenues,” his report said. “For example, if Pennsylvania’s revenues fell to the license-state average revenue per gallon of $15.47 instead of the current $53.40 per gallon, the state would lose over $200 million per year at a similar level of spirit sales.”
But Leonard Gilroy, director of government reform for Reason Foundation, a public policy think tank in support of privatization, said a state could actually gain more in revenue if analyzing all pieces of the system. He said many states that have moved to privatizing parts of alcohol systems enacted a revenue-neutral plan to ensure the state would maintain the same amount of revenue generated by alcohol sales as it did when fully controlled.
“The reality is that you have to look at the entire operation,” Gilroy said. He added that taxes and new revenue from either selling or auctioning licenses for retailers to sell alcohol would continue to yield revenue for the state. States also would benefit by selling the state-run industry assets, such as property, state distribution warehouses and state-issued vehicles or other items used in the alcohol industry.
North Carolina’s Office of State Budget and Management reported in October the state would maintain similar prices and consumption rates of alcohol by moving to a revenue-neutral system in which retail licenses are auctioned. According to that report, the state could receive a first-year windfall of $150 million to $500 million and wouldn’t sustain any annual local losses or increases.
Social concerns
But would moving to a private model increase alcohol-related problems?
According to Kerr’s research, alcohol is more available in states where private retailers have licenses to sell spirituous liquors.
Call that a good thing for those who want more access and longer hours to buy liquor, but the Alcohol Research Group’s report said increased availability would also increase drunken driving and underage consumption.
Kerr said retailers controlled by the state typically are professionally trained to detect and prevent purchases by those underage.
He added that a state-run oversight board, such as North Carolina’s Alcohol Beverage Control Commission, would help reduce marketing aimed at youth.
“If a product appears marketed to kids, they might be quicker to spot something like that and not allow it to be sold,” Kerr said.
Gilroy, on the other hand, suggests that statistics based on per capita population counts do not reflect a correlation between increased alcohol-related problems and privatization.
“There’s no difference between control states and privatized states,” he said.
Mixed philosophies
A state doesn’t necessarily have to choose between being fully privatized or controlled. Several states, including some considered “control” states, operate with mixed methods.
All 50 states regulate the sale and distribution of alcoholic beverages to some extent by either controlling the distribution and sale of liquor, licensing suppliers or imposing taxes.
West Virginia, for example, is considered one of the nation’s 18 control states. The other 32, with Maryland having two counties considered controlled, allow retailers to have private licenses.
West Virginia privatized the retail sector of its alcohol industry in 1991, but the state maintains control over the distribution of liquor through a state-run warehouse, similar to North Carolina’s state distribution warehouse in Raleigh. West Virginia’s alcohol control administration also sets the markups for spirituous liquor, but allows flexibility for retailers to set their own prices in addition to the markup, said Gig Robinson, spokesman for the West Virginia Alcohol Beverage Control Administration.
Other states with hybrid models include Vermont, Alabama and Idaho, which have both private stores and state agency stores, said Steve Schmidt, vice president of public policy and communications for the National Alcohol Beverage Control Association.
Schmidt said some states contract some stores to private retailers who then operate them according to state standards.
Exclusive to N.C.
North Carolina controls the wholesale and retail of spirituous liquor, like several other states, but it’s the only state where local governments appoint a board to operate retail stores. There are 107 ABC boards that control more than 160 state stores.
For more than a century, North Carolina has had control in one form or another over its alcohol industry. In 1908, it was the first southern state to enact prohibition of alcohol, and even after prohibition was repealed in 1933, state leaders enacted a local option to maintain government control over the sales and distribution process of spirituous liquors.
That created the state’s Alcohol Beverage Control, and since then things haven’t changed much more than a tweak here and there in the law.
Gov. Beverly Perdue has taken the first steps in modifying that system in what appears to be a response to revelations of high salaries paid to administrators in New Hanover County and lavish dinners paid for by liquor representatives and accepted by ABC employees across the state.
Chrissy Pearson, the governor’s press secretary, said analyzing the state’s ABC system actually was on the governor’s mind “for quite some time, even before the scandals that have come out in the news.”
She said the governor has requested an evaluation of the current ABC system, and the budget reform committee is expected to make a presentation of its research to the governor at its March 10 meeting.
That report, if prepared by the meeting, will include the options of privatization, whether or not the committee will actually recommend that, said Norris Tolson, co-chairman of the commission.
Pearson said the governor wants to examine all ramifications of each option before taking any stance.
She said although some have called loudly for privatization, the governor can’t make that call until all research is presented.
“At this point she is looking at all the options, but she is looking at them carefully,” Pearson said. “She is not quick to judge.”
Shannan Bowen: 343-2016
On Twitter.com: @shanbow
By Shannan Bowen
[email protected]
Published: Saturday, February 6, 2010 at 3:30 a.m.
Slow economic recovery predicted (Durham Herald Sun)
Slow economic recovery predicted
DURHAM — North Carolina’s economy, like the country’s, appears to have bottomed out and is poised for what’s likely to be a slow recovery from the recession, an N.C. State University economist said Wednesday.
Employment should starting picking up soon, but the state “will be lucky” to add 40,000 jobs in 2010, economics professor Michael Walden told city and county managers from around the state in Durham Wednesday for an annual seminar.
The recovery of a consumer-driven economy is likely to be slow-paced because families will devote more of their money over the next couple years to paying down the debts they incurred while they could borrow against rising home values, Walden said.
Most forecasts suggest the recovery nationally will take three to four years, he said.
Walden nonetheless voiced optimism, predicting this state’s economy would grow faster than the national average as demand for manufactured goods returns.
“Looking at the state analytically, I would be hard pressed — hard pressed — to find a state that’s better positioned and has better prospects for future economic growth than North Carolina,” he said. “All states are facing the same issues, but we have a great ability to tackle those issues and deal with whatever the future economy is going to throw at us.”
Walden followed Gov. Beverly Perdue to the podium at Wednesday’s conference.
Like the economist, Perdue stressed it will take time to get unemployment, incomes and facets of the economy back to what they were before the recession took hold in 2008.
“This recovery is going to be slow. It’s going to be very hard,” Perdue said. “You at the local level are going to have to understand, just like we do at the state level, that things are not over yet. The challenges have only just begun.”
Walden has become one of the go-to people for local government administrators who, budgeting in mind, are eager to get a handle on economic trends.
Durham City Manager Tom Bonfield called him in a year ago to address the City Council at a budget planning retreat, and he offered a briefing elected officials said afterward heavily influenced their thinking.
Walden is also well regarded by the state’s conservatives. He has penned numerous articles for the John Locke Foundation, a Raleigh think tank linked to former Republican legislator Art Pope.
Regardless of that tie, Walden said he thought the federal government had acted appropriately in 2008 and 2009 to cushion the economy.
He noted that the Bush administration was responsible for some $950 billion in tax cuts and bailouts, to go with close to another $800 billion in economic stimulus from the Obama administration.
The Federal Reserve has matched them, pumping up the money supply by some $2 trillion.
Comparatively, “more resources have been spent fighting this recession than were spent during the [1930s],” during the Roosevelt administration’s efforts to combat the Great Depression, Walden said.
But the collapse of the housing market and other problems that caused a 20 percent, $11 trillion reduction in the citizenry’s on-paper wealth demanded such an aggressive counter, he said.
“I agree with the view we were at the edge, we were right there, and were going to fall off,” Walden said, referring to the crisis that unfolded in 2008. “The combined efforts of both administrations pulled us off the edge.”
The problem federal officials face now is deciding when to pull back some of their efforts to stimulate the economy, lest it trigger a round of inflation, he said.
Walden expects the Federal Reserve to take the lead on that, and believes the country has a two- to three-year window before inflation might assert itself.
Repeating what he told the Durham council a year ago, Walden said the Federal Reserve’s attempts to quell an unprecedented housing bubble by raising interest rates helped trigger the crash.
Economists there and on Wall Street didn’t anticipate that bubble-busting measures would cause housing prices nationally to retreat, he said. Rather, they saw price increases continuing, but at moderate, historic rates of 2 to 3 percent annually.
The housing collapse “is why this recession has been so different from other recessions,” as it has undermined bank and family balance sheets alike, he said.
By Ray Gronberg
[email protected]; 419-6648
Sen. Larry Shaw Becomes 7th Dem to Not Seek Re-Election for N.C. Senate (Associated Press)
Sen. Larry Shaw Becomes 7th Dem to Not Seek Re-Election for N.C. Senate (Associated Press)
Sen. Larry Shaw, a Democrat from Cumberland County, who also served a term in the House, brings to seven the number of Senate Democrats since last fall who have resigned or said they won’t run for re-election.
RALEIGH, N.C. — Another veteran Democrat in the state Senate won’t return after 2010 as Sen. Larry Shaw announced Thursday he won’t seek an eighth two-year term. The decision means the Legislature will lose its only openly practicing Muslim.
Shaw, a Democrat from Cumberland County who also served a term in the House, brings to seven the number of Senate Democrats since last fall who have resigned or said they won’t run for re-election. The candidate filing period begins Monday.
Shaw, 60, didn’t give a specific reason for stepping aside, and he wasn’t immediately available for comment Thursday, according to a person who answered the phone at his Fayetteville home. Shaw said in a news release he plans to keep working with the family business — he’s the owner of a food services company — and “in the international faith communities.”
Shaw last year was named chairman of the Council on American-Islamic Relations, a civil rights group. The council said Shaw was the country’s highest-ranking Muslim elected official before 2006.
“It has been a privilege and a sacrifice from family and associates to serve the greater good of society,” Shaw said. “My public service duty has been fulfilled and now the torch of community servitude must be passed on.”
Sen. Ellie Kinnaird, who joined the Senate with Shaw in 1997, said his presence has encouraged openness about differing faiths and has been a great example to his colleagues. After the Sept. 11, 2001, attacks, Kinnaird said Shaw helped bring an imam to the Senate chamber to lead prayer to open a daily session.
“They are able to see that Muslims are good citizens and have a great deal to contribute not only to our discourse, but to everything that we do,” said Kinnaird, D-Orange.
Shaw also spoke out in support of a 2007 ruling that allows any religious text, including the Quran, to be used to swear in witnesses or jurors in North Carolina courtrooms. He’s also a strong supporter of charter schools and a moratorium of the death penalty.
“Time and again, Larry has been a voice of conscience in the Senate and contributed to a broader and richer world view for us all,” Senate leader Marc Basnight, D-Dare, said in a news release.
Other previously announced departures by Senate Democrats include Majority Leader Tony Rand, who resigned Dec. 31 to run the state parole commission. Sen. David Hoyle, a finance committee co-chairman, and Sen. R.C. Soles, a 41-year veteran of the Legislature indicted last month on an assault charge for a shooting at his home, also won’t run for re-election.
The moves have given hope to Senate Republicans for making gains this November in a chamber they haven’t controlled since the late 1890s and where they currently hold 20 of the 50 seats.
Lanny Wilson’s seat on transportation board filled by Jacksonville car dealer (Wilmington Star News)
Lanny Wilson’s seat on transportation board filled by Jacksonville car dealer (Wilmington Star News)
Could Lanny Wilson’s fall from grace drag down the area’s transportation infrastructure too?
The N.C. Department of Transportation announced on Thursday that Mike Alford of Jacksonville was sliding over from his at-large seat on the state Board of Transportation to fill Wilson’s old seat and represent Southeastern North Carolina.
That means there’s no one from New Hanover, Brunswick or Pender counties on the 19-member board – and that raised some red flags among local officials.
“I’m disappointed,” said state Rep. Danny McComas, R-New Hanover, who worked closely with Wilson on several projects. “They’re the voices for the community in Raleigh on transportation issues, and right now we don’t have anyone.”
Although Alford, owner of Marine Chevrolet, does reside within DOT’s Division 3, he is from Onslow County.
Seats on the board are political appointments, so Alford’s move was vetted and approved by the governor’s office.
And, according to the N.C. Board of Elections, Alford has given money to several Democratic candidates, including the current and former governors.
Records show he gave Gov. Beverly Perdue $4,000 in 2008.
“I’m extremely honored to receive this appointment from the governor,” Alford said in a DOT release announcing his four-year appointment. “I look forward to working with the other board members and the NCDOT staff to carry out the mission and goals for the department.”
But for Wilmington, the bigger question is whether Alford’s appointment mean a loss of local clout on one of the state’s most powerful boards – even if Perdue has watered down its powers since taking office.
While the General Assembly officially has oversight of the DOT, legislators don’t normally interject themselves into the agency’s day-to-day operations or project-planning process.
As the representative for Southeastern North Carolina, Wilson was widely recognized as diligently working to determine the region’s transportation needs and priorities and getting state projects to meet them.
Among his more notable achievements was clawing back money for the region that had been used to fund transportation projects in the Triangle area after the local projects got bogged down with permitting problems.
The Wilmington attorney and developer also was vice chairman of the N.C. Turnpike Authority and a major force behind the proposed Cape Fear Skyway high-rise bridge project.
And finally Wilson was chairman of the Wilmington Urban Area Metropolitan Planning Organization, which sets transportation priorities for the greater Wilmington area.
But Wilson has been fingered by federal prosecutors as having a major role in facilitating the “pay-to-play” culture that permeated former Gov. Mike Easley’s administration.
Easley appointed, and then reappointed, Wilson to the transportation board.
Wilson resigned from the Board of Transportation the morning before the 51-count indictment against Easley’s top aide, Ruffin Poole, was announced on Jan. 21. He left the turnpike board a few days later.
State Rep. Carolyn Justice, R-Pender, said she would move quickly to establish a relationship with Alford and inform him of the region’s transportation needs and priorities. They include the future of the Hampstead and Burgaw bypasses, what to do about the Surf City swing bridge and the status of the proposed Military Cutoff Road extension.
“I’m looking forward to working with him,” Justice said. “But, on the surface, this can’t be good news for us.”
Wilmington City Councilwoman Laura Padgett, who had expressed interest in Wilson’s old position, was traveling and couldn’t be reached for comment on Thursday.
Gareth McGrath: 343-2384
By Gareth McGrath
[email protected]
Published: Thursday, February 4, 2010 at 11:48 a.m.
DENR Air Quality Update (NCLM)
DENR Air Quality Update (NCLM)
Erin Wynia, a policy analyst with the League of Municipalities, attended a meeting Tuesday, Feb. 2, with DENR air quality staff where good updates were provided. She has provided this summary.
In short, EPA is embarking upon a slew of new regulations in the air quality arena. Some have the potential to impact local governments. I’ll take each in turn so you can understand the current actions.
1. OZONE STANDARDS: EPA has proposed two standards: one to address human health and one to address effects on plants and environment. EPA is now receiving comments on both proposed standards and intends to set final standard by Aug 31, 2010. Under the Clean Air Act, North Carolina can then suggest areas designated non-attainment for ozone. The anticipated date for these designations is January 2011, with final EPA designations by August 2011. Under the current EPA proposal, many areas of the state would be non-attainment. If the EPA goes for the low end of its proposed standard range (0.60 ppb), DENR expects every air quality monitor in the state to be in violation. If at the upper end of the proposed standard range (0.70 ppb), DENR expects 5-6 monitors in the state to be in violation, which would still result in widespread non-attainment.
2. NO2 STANDARDS: EPA just announced last week a proposal to begin monitoring for NO2, nitrogen oxide. These gases are emitted by industry and motor vehicles, and currently, there is insufficient data on NO2 emissions to justify regulating for this compound; hence, the monitoring proposal. The innovation in this proposal is that the monitors would be required to be located within 140 feet of major highways in areas of the country that have greater than 500,000 people in a given metropolitan statistical area (Raleigh, Triad, Charlotte would have roadside monitors; in addition, Raleigh and Charlotte would have “community monitors”). This sort of monitoring is expensive, and the roadside location is unprecedented in the history of the Clean Air Act. Basically, it is saying that vehicles are the source of NO2, rather than industry.
The issue right now is who is going to pay for the costly monitoring stations. The DENR air quality unit is funded entirely by permit fees and from the federal government – no state funding. DENR could go back to Title V permit holders, but DENR said yesterday that those permit holders are not the source of this pollution. I asked if local governments would be approached, and the staff genuinely looked a bit baffled. They replied that they would simply tell EPA that it had to pay for the monitors and the monitoring staff costs, or EPA can do the monitoring itself if it thinks it’s so important.
A corollary issue has been raised by NC DOT (commenting since these monitoring stations would likely be within DOT right-of-way). DOT is concerned about the safety of workers checking the monitors so close to high-speed traffic areas.
Like the process for ozone, EPA will allow North Carolina to submit its recommendations for attainment/non-attainment boundaries by January 2011. Because the state has scant data for this pollutant, the designations right now are likely to be “attainment” for all areas of the state. But, DENR expects that once monitors are installed (by 2013) and data is collected, there will be some areas that inevitably will be designated “non-attainment” for NO2. Right now, the time frame for this later action is 2013-2016.
3. SO2 STANDARDS: These standards will actually affect stationary sources and not local governments so much, but I raise it because some of the issues bleed over into the pollutant regulations discussed above that will affect local governments. Namely, the “who will pay for the monitors” debate exists in the context of this pollutant as well. Apparently, the cost of these new monitors is already more than DENR has to allocate for such an expense, and it’s more than the President put into his recent budget proposal. These monitors are required now, unlike the NO2 monitors discussed above, which are still in that “theoretical discussion” stage.
4. GHG RULES: The rules regulating greenhouse gases (GHG, which include carbon dioxide, methane, nitrous oxide, and several “fluorinated” GHGs) are proceeding along several different tracks, some of which will affect local government operations. EPA has two rulemakings (mandatory), and North Carolina has one (voluntary). EPA’s rulemakings are requiring North Carolina to rush through its own corresponding rules to implement EPA’s edicts. This N.C. rulemaking process will mean a special meeting of the EMC in April and possibly also in June.
The first EPA rulemaking is the GHG emissions reporting rule, which is already final. Currently, many industries are collecting data on their emissions and they will begin reporting it in March 2011. Significantly, vehicle/engine manufacturers will have to do corporate-level reporting for the GHG emissions of their products. Eventually, the scope of who has to report will widen to include municipal landfills and larger wastewater treatment plants. Both of these types of municipal facilities emit GHGs, primarily methane. The EPA proposal on reporting for these facilities is expected soon. Obviously, our members would have to figure out how to pay for the monitoring equipment and staff to collect data from the monitors and report it. They would also become Title V permit holders and subject to extra regulatory hoops any time they try to expand or significantly change their operations.
The North Carolina rulemaking is virtually identical to EPA’s GHG emissions reporting rule, as described above. Because EPA’s action came along before North Carolina could establish its own rule, DENR has chosen to make its rule voluntary. It does not affect local government operations at this point.
The second EPA rulemaking is called the GHG tailoring rule. This rule is necessary to limit the scope of who would otherwise be required to report GHG emissions under the Clean Air Act. If this rule wasn’t enacted, there would be so many sources required to report their emissions due to existing Clean Air Act standards that EPA would be completely overwhelmed, administratively. So for now, only the big guys will be required to report. As stated above, this could eventually include some of our larger-emitting members. Within five years, EPA will have a better handle on administering this program and at that point, could expand the reporting requirements to capture some smaller emitters. For now, it’s unclear how many landfills and wastewater treatment plants would be brought into the realm of reporting. The main concern is that these types of facilities have not had to comply with past air quality regulations, and so there will be a massive amount of public education needed.
Administration Shifts DOT Priorities (The Journal of Commerce)
Administration Shifts DOT Priorities (The Journal of Commerce)
2011 budget emphasizes infrastructure but rises only a little
President Obama’s 2011 budget for the Department of Transportation shows an overall 2.3 percent increase compared with 2010 as the administration emphasizes infrastructure projects but hopes to curb unnecessary spending.
The new bright spot in the DOT’s budget is $4 billion in seed money for a new National Infrastructure Innovation and Finance Fund.
Existing agencies fared better and worse than the norm, reflecting other administration priorities.
The Federal Aviation Administration shows a 4 percent increase, $12,953 billion, up from 12,477 in 2010. The administration is asking Congress for a $1.14 billion increase in funding for the Next Generation air traffic control system.
The Federal Highway Administration, one of DOT’s biggest divisions, has a budget growth of only 0.6 percent, $41,636 billion, up from $41,107 billion.
The Pipeline and Hazardous Materials Safety Administration would increase its budget 6 percent, $174 billion, up from $164 billion.
The Federal Railroad Administration’s 2011 budget shows a huge drop on paper, $4.64 billion to $2.8 billion, but in 2010 $2.5 billion in American Recovery and Reinvestment Act money passed through the agency. In 2009 the agency received another $8 billion for high speed rail grants. The 2011 budget shows an additional $1 billion for high speed rail.
The Maritime Administration shows a 3 percent loss for 2011, $352 million down from $363 million. The budget provides an additional $14 million for the U.S. Merchant Marine Academy, but a $5 million reduction in money for ship disposal. The budget provides $3.6 million to administer the Title XI loan guarantee program, but no funds for loans themselves.
Contact R.G. Edmonson at [email protected].
R.G. Edmonson | Feb 2, 2010 9:13PM GMT
Highway Bill Detoured (The Journal of Commerce)
Highway Bill Detoured (The Journal of Commerce)
Washington’s focus on jobs and search for revenue keep transportation bill parked in Congress
The drumbeat of jobs, jobs, jobs in Washington and debate on financing have become major roadblocks to getting a six-year $500 billion transportation bill into gear and onto a fast-paced road to passage.
Infrastructure advocates argue that investment in transportation infrastructure is a sure-fire creator of jobs. There’s support for jobs and infrastructure on Capitol Hill, and the clamor for jobs will increase government investment in the latter. However, there’s no guarantee Congress will go further and address surface transportation’s long-term needs any time soon.
Six months ago, the House seemed poised for swift passage of legislation to reform the Department of Transportation and invest $500 billion to upgrade highways and mass transit. With jobs now the center of attention on the Hill, the drive appears to have lost momentum.
Rep. James L. Oberstar, D-Minn., chairman of the House Transportation and Infrastructure Committee, introduced the six-year $500 billion transportation bill. He vowed to have it through Congress by last Sept. 30, the date the preceding plan, SAFETEA-LU, was to expire. The legislation won broad bipartisan support, but stalled when the House couldn’t find ways to pay for the plan that would cost nearly twice as much as its predecessor.
Jack L. Schenendorf, former vice chairman of the National Surface Transportation Policy and Revenue Study Commission, said Oberstar’s bill met the two basic recommendations the commission made in December 2007.
“One was significant reform in the federal program to make it more accountable and performance-oriented. The second was a significant increase in investment,” Schenendorf said. “Those things needed to be done and done urgently. We needed to get moving on modernizing our transportation system for the 21st century. That was our message. Obviously, it hasn’t happened yet.”
The Senate and the administration have come no closer to the goal, and the revenue problem remains a hurdle, Schenendorf said. “The administration’s general position is we need more time to figure out what to do.” The White House originally wanted two years to figure it out. The Senate wanted an 18-month timetable. Sen. Barbara Boxer, D-Calif., chairman of the Environment and Public Works Committee, put climate change higher on her priority list. Boxer faces re-election in November.
“Their approach would have been to wait another 18 to 24 months to settle things down, and figure out what to do. Oberstar doesn’t like that idea. He wants to keep pushing to do it now instead of later, but he’s got that revenue roadblock,” Schenendorf said.
Instead of a comprehensive bill, Congress passed short-term extensions of SAFETEA-LU, “because nobody can agree on what the interim extension should be,” Schenendorf said. “Even if the jobs issue didn’t exist, I don’t think we’d be any farther along.”
“Jobs are going to be the main energy that’s going to drive the political debate and action. I think all things are going to be shaped by jobs, regardless of the issue,” said John Horsley, executive director of the American Association of State Highway and Transportation Officials.
The House passed a jobs bill before it recessed in December, and a Senate version is due shortly. Both provide substantial sums for infrastructure investment. The White House likes the jobs bills, and Horsley believes Congress will make progress on a broader transportation bill, but in increments.
By March, Congress will have to pass another SAFETEA-LU extension, Horsley said. Without it, state officials will lose $12 billion in funds available for transportation projects.
The Highway Trust Fund will need another infusion of money from general revenue. AASHTO projects the trust fund will be insolvent by the end of July. The Highway Trust Fund received $7 billion from the general fund in 2008, and $8 billion last year.
Horsley believes Congress should have a new transportation bill by year’s end, with enough revenue to sustain the trust fund.
“I don’t see that happening until after the 2010 election, hopefully as soon as possible after,” Schenendorf said. “I don’t see it happening before then, notwithstanding the good efforts of Chairman Oberstar.”
Horsley took the long view. After all, by the time Congress passed SAFETEA-LU, its predecessor plan had been extended two years past its 2003 expiration. “We’re not even a year late yet,” Horsley said. “We’re only four months into it.”
Contact R.G. Edmonson at [email protected].
R.G. Edmonson | Feb 1, 2010 5:00AM GMT
2010 Debt Affordability Study
Debt Study (Insider)
North Carolina has “substantially exhausted” its ability to issue more General Fund-supported debt for the next two years, according to a debt affordability study issued by State Treasurer Janet Cowell. The annual study recommends that legislators consider issuing general obligation bonds, rather than special indebtedness like certificates of participation, in the near future. As already authorized but as yet unsold COPs go to market, North Carolina’s amount of special indebtedness will no longer be in line with other states enjoying a triple-A bond rating, the study found. The report, approved by a nine-member committee, continued to show disagreement between Cowell and Gov. Beverly Perdue over a special financing plan for a portion of the I-485 loop around Charlotte. The report called for the General Assembly to clarify whether projects like the contractor-financed proposal being considered by the Perdue administration is allowed and for legislators to set specific financing amounts and terms.
Perdue’s budget director Charlie Perusse and Revenue Secretary Ken Lay, both members of the committee, objected to the recommendation, according to a notation in the report. The study found that the state could only issue $9 million in additional General Fund-supported debt in each of the next five years and stay within self-imposed limit intended to protect the state’s bond rating. That limit is based on spending no more than 4 percent of General Fund revenues each year to repay debt. By increasing debt payments to a ceiling of 4.75 percent of General Fund revenues, the amount of debt issued in each of the next five years could rise to $575 million, the report said. The state currently has about $6 billion in authorized General Fund-supported debt. About $1.9 billion has yet to be issued, or sold. The report assumes that debt will be issued over the next four years. Roughly half of the state’s debt has gone to support university construction.
Investing in Livable Cities to Meet 21st Century Transportation Challenges (US Conf of Mayors)
Investing in Livable Cities to Meet 21st Century Transportation Challenges (US Conf of Mayors)
Demographic change, urbanization and climate change are shaping our future and posing daunting global challenges. For the first time in history, half the world’s population now lives in urban centers. Experts predict that 90 percent of the future population growth will be concentrated in cities. These trends and numbers underline the fact that mobility is the biggest challenge when it comes to ensuring sustainable growth for the future.
“We are at a defining moment as we start a new decade of this Century,” Conference Transportation and Communications Committee Chair Denver Mayor John Hickenlooper proclaimed, welcoming the Director of the White House Office of Urban Affairs Adolfo Carrion, the Environmental Protection Agency Administrator Lisa Jackson, the Housing and Urban Development Deputy Secretary Ron Sims, and the Department of Transportation Assistant Secretary for Transportation Policy Polly Trottenberg to the January 20 Investing in Livable Cities to Meet 21st Century Transportation Challenges Special Plenary during The U.S. Conference of Mayors Winter Meeting.
Hickenlooper continued, “The next transportation bill will decide if federal policy-makers are going to continue the antiquated funding priorities and delivery systems that lets states, not cities and their metros, decide in nearly all cases where and how the lion’s share of our federal surface transportation dollars are spent – with the product line, all too often from this delivery system, being the building of more roads and highways.”
Hickenlooper then asked, “Are federal policy-makers going to get it right and reverse decades of underinvestment in our nation’s cities and their metro areas by rebuilding the infrastructure to reduce greenhouse gas emissions and fuel consumption, utilize cleaner and alternative fuels, and increase the movement of people and goods by more energy-efficient vehicles and systems?”
It is time for a significant paradigm shift in federal policy, said Hickenlooper, “…one that empowers mayors and other local leaders to set priorities in their areas, beginning with enhancing the livability and economic viability of their cities, and their neighborhoods, by integrating transportation, housing, land use, and economic development.”
Joining his call for a new set of federal transportation priorities were Conference of Mayors Co-Chairs for the Sustainable Development Task Force Southfield (MI) Mayor Brenda Lawrence and Oak Park (IL) Mayor David Pope. “We need to shift our thinking beyond the traditional approaches of transportation investment that served us well post World War II but does not meet our needs in the 21st century,” said Lawrence. “An antiquated transportation system that causes time to be wasted, contributes to air pollution, and consumes valuable and finite energy resources is obsolete.”
Pope highlighted the urgency stating, “Current projections are that by 2040, we’ll have 95 million more people requiring transportation and transit services, while at the same time on our current trajectory, it is expected that our vehicle miles traveled will more than double to seven trillion miles by 2055.”
“There is, however, a compelling alternative where we can build upon our metropolitan areas that are already home to four out of five Americans and we can strengthen our cities and rebuild our communities, helping make them highly desirable places where people want to live, work, and play – tying together transportation and land use,” said Pope.
Carrion said that the White House Office of Urban Affairs is working on policy “built on a responsible and sustainable infrastructure platform in our metropolitan regions where the lion’s share of people and the businesses and the jobs are.” He said, “Funding needs to be more directly given to the municipalities and more latitude needs to be given to you to do what you do best.”
Jackson said that sustainable development is not only good for the environment but also for the economic vitality of a region. She also acknowledged that mayors were leading the way on sustainability. “We
Sims said that the Department of Housing and Urban Development (HUD) should no longer be seen as just a housing agency. “We are now a development agency and that requires some very significant changes for HUD and how it does business.”
“Our focus is to make sure every metropolitan area, every community be competitive in the 21st century; the federal government must make sure it is a partner in that process,” Sims said. “Our goal is to reduce impacts on global warming, to make transportation efficient and to make communities livable and sustainable,” he added.
Trottenberg said she was “sympathetic to all the struggles the cities around the country have had in getting the resources they need. For us [USDOT], livability is a fundamental and long overdue change in America transportation policy.”
“Livability is going to be one of our top priorities in the reauthorization bill going forward,” she added.
Juergen Wilder, Vice President with Siemens Mobility, provided mayors with an exciting new holistic concept in transportation that is transforming today’s cities into metropolises that provide reliable, safe and efficient ways to move people and goods without harming the environment. “To ensure mobility in the future, we need to closely network transportation and information systems. Whether transportation takes place within urban centers or in cities and countries – the multiple challenges can only be mastered only if all transportation modes are sensibly coordinated and function smoothly,” said Wilder. “To meet these needs, Siemens offers integrated mobility solutions that ensure safe, economical and environmentally compatible passenger and freight transportation.”
Bringing the discussion to a close, Hickenlooper said, “Going forward, and with a focus on the next surface transportation bill, all federal-assisted transportation investments must emphasize sustainable transportation investments, led by integrating transportation, housing, land use, economic development, and the environment.”
By Ron Thaniel, Gene Lowe and Judy Sheahan
February 1, 2010
