This seems more easily parsed by humans. My immediate faction to this is a positive one. Instead of having to scan the entire class to tell whether or not a variable is static, it's declared in the method itself.
I don think it is very useful or practical. A similar effect can be done using static variables declared outside the methods.
But it is a good example on how to write a plugin, with annotations and instrumentation. So the interesting parts are on the code implementing this functionality.
Also, it seems like (if abused) it would make unit testing really cumbersome without some sort of side-effecting mechanism to expose these persistent variables.