2017 NC House Budget Highlights

House Budget Proposal Highlights

S.B. 257

The House Budget for FY 2017-18 includes net appropriations of $22.9 billion, which is

$559 million or 2.5% above the amount enacted for FY 2016-17. Selected highlights include:

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Savings Reserve

  •  Transfers an additional $263 million to the Savings Reserve to bring the total held in the “rainy day fund” to $1.82 billion, the largest balance in the Savings Reserve since its inception.

Salaries

  • Provides over $180.9 million in FY 2017-18 and $456.5 million in FY 2018-19 to:
    • Increase salaries for Teachers and Instructional support paid in accordance with the Statewide teacher salary schedule;
  • Provides most State employees and State-funded local employees a salary increase of $1,000 in FY 2017-18 and an additional $1,000 in FY 2018-19;
  • Allows step movement for teachers, assistant principals, Highway Patrol, Assistant/Deputy, Clerks, and Magistrates.
  • Provides 5 Bonus Leave days for State and locally supported employee

Benefits

  • Provides $51 million for a 1.6% one-time supplement to State Retirees (same as in 2016)

Capital & Infrastructure

  • Provides funds for House Bill 280 “Raise the Age.”
  • Diverts $77.1 million and $79. 1 million over the biennium from short-term lease or rental of motor vehicles from the General Fund to the Highway Fund to support NC Airports infrastructure

Other Items

  • Provides an additional $150 million for Disaster Recovery. This funding would supplement the $200.9 million in funds provided by S.L. 2016-124 (Disaster Recovery Act) bringing the total State funding for Disaster Recovery to $350.9 million.
  • Provides $6.6 million for pending legislation such as HB 270, The Haley Hayes Newborn Screening Bill; HB 910, Human Trafficking; and others.

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Highlights of House Education Budget

The House Budget for Education in FY 2017-18 and FY 2018-19 includes net appropriations, before salaries and benefits, of $12.6 billion and $12.8 billion. The highlights of the Education adjustments follow below:

Public Schools Committee Report Items

  • (Page F-6, Item 1) Fully funds K-12 enrollment growth by providing $31.9 million in FY 2017-18 and $80.3 million in FY 2017-18.
  •  (Page F-7, Item 5) Increases Textbooks and Digital Materials funding by $10.4M in 2017-18 only. Total funding for textbooks in this allotment is $65.8.6 M in FY 2017-18 and $55.5 M in FY 2018-19.
  • (Page F-13, Item 33) Provides $8.2M in additional funds to the Advanced Teaching Roles in FY 2017-18 and FY 2018-19, for a total of $9.2M for this program in each year of the biennium. This pilot program supports school district efforts to create the organizational structure and innovative compensation methods to allow teachers to take on advanced teaching roles.
  • (Page F- 15, Item 41) Eastern North Carolina STEM: Provides $300K in FY 2017-18 for the Eastern NC STEM program, which is a summer residential STEM program for underserved students.

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Public Schools Special Provisions

  •  (Sec. 7.10) Provides $922K to the Office of the State Superintendent to hire up to 10 exempt positions. These positions are not subject to approval or disapproval by the State Board of Education.

North Carolina Community College System Special Provisions

  • (Sec. 9.13) Establishes the High-Achieving Tuition Scholarship Program. Recent North Carolina resident high school graduates with an unweighted GPA of at least 3.5 meeting other eligibility criteria may receive scholarships covering the full cost of tuition at a community college for up to four semesters. The program will be established in FY 2017-18, with $2 million for scholarships and administration beginning in FY 2018-19.

University of North Carolina System Special Provisions

  • (Sec. 10A.3) Establishes the Teaching Fellows program, a competitive forgivable loan program that will provide students interested in entering teaching in STEM or special education fields with up to $8,250 per year. The loans may be used for tuition, fees, and the cost of books. Loans made to Teaching Fellows may be forgiven if the recipient, for each year of loans received, serves either one year in a North Carolina public school identified as low-performing or two years in a North Carolina public school that is not identified as low-performing.

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Highlights of House Health and Human Services Budget

The House Budget for Health and Human Services in FY 2017-18 includes net appropriations of $5.2 billion, which is $225 million above the amount enacted for FY 2016-17. This is a 4.5% increase. FY 2018-19 includes net appropriations of $5.4 billion, which is $170.1 million above the amount in the House budget for FY 2017-18. This is a 3.2% increase. The highlights of the Health and Human Services adjustments follow below:

Division of Central Management and Support

Committee Report Items

  •  (Page G-7, item 7) Provides funding for continued development of NC FAST including the Child Welfare case management system. ($8.9 in 2017-19 and $11.9 in 2018-19 on a nonrecurring basis in both years)

Special Provisions

  • (Sec. 11A.14)  Provides $4.7 million in the DHHS Competitive Grants for Boys and Girls Clubs, Big Brothers Big Sisters, and TROSA.

Division of Social Services

Special Provisions

  • (Sec. 11L.1.k) Social Services Block Grant provides $3 million nonrecurring in each year of the biennium to assist counties in the implementation of the Child Welfare case management system in NC FAST.
  •  (Sec. 11F.5) Purchase of psychiatric and facility based crisis beds with Dorothea Dix Property funds in the amount of $19M to increase inpatient behavioral health bed capacity for adults at 5 selected hospitals, $ 2M for a case management pilot program in Wake County and $2M for competitive grants to establish up to two new facility-bases.

Justice and Public Safety Committee House Budget Highlights

Proposed Committee Spending: $2.6 billion

The proposed JPS conference budget provides an additional $12.5 million in the first year of the biennium and $7.9 million in the second year of the biennium for the State’s criminal justice agencies.

Department of Public Safety (DPS)

  •  Grants for Law Enforcement Cameras. Provides matching grants for local and county  law enforcement to purchase and use body-worn or dashboard video cameras: $2 million (I-11, #4)
  •  New Trooper Positions.   Provides funding for 30 new trooper positions: $1.6 million    and $1.5 million to provide start-up equipment (I-11, #6)

Judicial Branch

  •  Deputy Clerks. Provides 56 additional deputy clerks positions. The additional clerks will bring most districts up to 95% of the workload formula target: $2.7 million (I-33, #30).
  •  Assistant District Attorneys. Provides 37 new assistant district attorney positions. $2.7 million (I-34, #31).

 

Department of Military and Veterans Affairs

  • J-20, #13 Veterans’ Memorial – Provides $250k for the construction of pavilion in Broadway, NC.
  • J-29, #22 - Fraud Investigator Positions - Provides additional funds for up to 30 sworn officers to investigates insurance fraud.  The amount available for all positions and operations is $2.4 million annually.

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Office of State Budget and Management

  • J-63, #30 Results First Framework – Provides $100,000 R for OSBM to work with the Pew- MacArthur Results First Framework Initiative to implement an evidence-based policy making model for developing policy and budget decisions.

J-64, OSBM – Dorothea Dix Special Funds (corresponds with decisions within Department of Health and Human Services budget)

Transfers funds from the Dorothea Dix Land Proceeds to the Department of Health and Human Services for start-up costs (renovation or construction) to establish new child facility-based crisis centers; funds will be awarded on a competitive basis, and will be available across 2 years. $2 million nonrecurring

Housing Finance Agency

  • J-109, #47 Workforce Housing Loan Program - Provides $16.1 million from the Moody’s settlement  and an additional $3.9 M of appropriations for a total of $20 M for the Workforce Housing Loan Program in FY 2017-18 and $20 million in General Fund appropriations for FY 2018-19.

Section 28.1 Workforce Housing Loan Program Established – Codifies the Workforce Housing Loan Program, which was established in FY 2014-15. Also changes the income caps to the following: $2 million in a low income county, $1.5 million in a moderate income county, and leaves the high income county cap at $250,000.

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House Transportation Committee Highlights

Revenue Forecast

  • The increased revenue is due to:
    •  Increased consumption of diesel and gasoline. The economic recovery is driving consumption higher in both fiscal years, offsetting losses due to fuel efficient and electric vehicles.
    • Increased highway use tax revenues associated with new and used car sales.

Money

  • The maintenance budget increases $58.5 million in FY2017-18 and $58.2 million in FY2018-19.
    • Increases funds for contract resurfacing by $40.0 million recurring.
    • Fully funds bridge preservation activities to extend bridge life and to reduce the number of bridges becoming deficient.
    • Provides $77.1 million in FY2017-18 and $79.1 million in FY2018-19 to fund capital improvement projects at the State’s 10 commercial airports in order to increase their economic competitiveness.

Provisions:

  • SEC. 34.8: RURAL PROJECT DEVELOPMENT – Establishes a new corridor development unit fully funded with federal funds or funded by the reclassification of vacant positions. This unit acts as the main contact for planning organizations (POs) to help the POs develop transportation projects in rural areas. Provides matching grant funds to POs for assistance in developing performance-based planning documents. The State provides a:
    • 15% match for POs with at least 1 Tier 1 county (16 RPOS/ 2 MPOs)
    • 10% match for POs with no Tier 1 counties but at least 1 Tier 2 county (1 RPO/ 12 MPOs)
    • 0% match for POs with no Tier 1 or Tier 2 counties (6 MPOs)
    • SEC. 34.19: FUNDING FOR AIRPORT IMPROVEMENTS AND DEBT SERVICE – Provides funding to 1 of the State’s 10 commercial airports for capital improvement projects and/or debt service $77.1 million in in FY 2017-18 and $79.1 million in FY 2018-19.

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