By Lexi Arthur

NC Legislative Update

September 14, 2020

North Carolina lawmakers returned to Raleigh on Wednesday, September 2nd for a session that lasted two days. The next day, the NC General Assembly adjourned after allocating the remaining $1.1 billion of COVID relief funding that needed to be spent before 2021. While most of the funds were doled out by the end of June, legislators did not spend the full amount of federal relief money in anticipation of a second COVID relief package before the end of August – which could have included guidance on more flexible spending – but has not yet been approved by Congress. Legislative leadership does not plan to come back in 2020, but there’s a caveat that another federal coronavirus funding bill from Congress or other needs that arise could prompt NC Governor Cooper to call a special session. 

Relief Package Transportation Funding

Since Congress did not pass additional coronavirus relief funding or provide more flexibility for states to use money from the previous recovery package, the NC legislature had to repurpose $300 million that was originally earmarked for NC DOT projects. Last week, Senate Pro Tempore Phil Berger expressed interest in revisiting this if Congress agrees on a new bill. He said, “If they are going to appropriate additional dollars, I think one area that we could use the money is for infrastructure improvements…We have $300 million that we wanted to use for transportation that we were unable to use.”

Unemployment Insurance

Coronavirus Relief Act 3.0 (HB 1105) was ratified with only 10 ‘No’ votes in the House, and a similar high level of support in the Senate. Governor Cooper signed the bill into law on September 4th.

This bill includes the required $50,000,000 state match for the $300 Lost Wages benefit. Unemployment insurance (UI) checks began being sent from the Division of Employment Security (DES) to qualified recipients on September 3rd.  There will also be an increase of $50 per week for UI benefits until the end of the year, which is funded by $87,000,000 in CARES Act funds. 

In early March, North Carolina had $3.85 billion in the UI Trust fund. Over $1.6 billion has been paid out in State Unemployment benefits as of September 3rd and the balance of the fund is still over $3 billion.  Governor Cooper strongly supports raising the monthly UI benefits and taking the UI balance down to $2 billion.  Employers across the state have shared concerned with policy makers about increasing benefits during this COVID period.  Employers could be soon looking at dramatically increased unemployment taxes if the fund balance drops below targeted amounts. 

Job Retention Grant Program 

HB 1105 allocates $45,000,000 to extend the Job Retention Grant Program. This program, established earlier in 2020, provides funding to assist North Carolina companies who have retained large portions of their workforce.  This program is administered by Department of Commerce and awards grants to businesses that retained at least 90% of employees during the “COVID period” and suffered and economic loss (10% downturn).  The bill also authorizes a “round 2” of funding for employers with 20 or fewer full-time employees.

Commercial License Renewal

Drivers with commercial licenses and learner’s permits now have longer to get them renewed under a provision in the coronavirus relief bill. People with state IDs and handicapped placards issued by the Division of Motor Vehicles also received an extension of their expiration dates, as did holders of inspection mechanic licenses. The provision in the Coronavirus Relief Act 3.0 means those five DMV credentials will not expire until 30 days after the governor lifts the state of emergency order related to the COVID-19 pandemic.