Brooks Pierce Capital Dispatch: Updates from the NC General Assembly and Governor’s Office – May 2021 # 2 | Brooks pierce
[co-authors: Katelyn Kingsbury and Drew Moretz, Government Relations Advisors]
This week, lawmakers considered dozens of bills as they worked to pass versions in a chamber before the crossover deadline.
Deadline for submitting cross-accounts and invoices
Lawmakers left Raleigh this week after working long hours ahead of the May 13 crossover deadline, when a bill that doesn’t impact taxes or spending must go through a chamber. Although the contents of an invoice may in some cases be inserted into an eligible invoice after this deadline, in practice, covered invoices that have not met the deadline are not eligible for the remainder of the session.
In addition, dozens of new House bills were introduced before the May 11 bill filing deadline for tax and expense bills. These invoices are not submitted by the crossing deadline.
The Senate is developing the budget bill first this year and, according to many sources, is well on the way to that process. Press reports indicate that the two chambers have yet to agree on spending targets, which is usually a step in the budget process. In addition, Governor Roy Cooper is expected to make recommendations next week on how to spend federal funds under the American Rescue Plan Act (ARPA). When federal funds for COVID-19 got to the state, lawmakers passed bills allocating those funds and they will likely do the same with ARPA funds.
Prohibit payment for ransomware
This week, the House passed and sent to the Senate a bill (H 813) to prohibit state agencies, local governments and the University of North Carolina from paying for ransomware in connection with incidents of cybersecurity. Under the bill, a covered entity that is the subject of a ransom demand in connection with an incident must consult with the Department of Information Technology.
Still pending PPP loan fee invoice
A bill (H 334) clarifying that expenditures related to federal Paycheck Protection Program (PPP) loans are not subject to state income tax for the 2020 tax year remains in abeyance in the Senate. The bill would temporarily repeal a provision in the current law that does not allow businesses to deduct expenses funded with PPP dollars if proceeds received from canceled PPP loans are excluded from income for tax purposes.