Legislative Newsletter For May 11, 2007
Legislative Newsletter For May 11, 2007 Last legislative week was very busy. The House budget consumed most of the time and I will try to provide a summary below. BUDGET PASSED: The state House, by a party-line 67-50 vote, approved a $20.3 billion budget plan early Friday morning that would provide $100 million in Medicaid relief to counties and raise state employee salaries by more than 4 percent. The House gave initial and final approval to the bill, in two separate votes, following seven hours of debate Thursday and about 10 minutes on Friday. The budget plan, which raises spending by 7.6 percent from the previous fiscal year, now goes to the Senate for consideration. The majority-party Democrats who backed the proposal said it accomplished many of their goals, continuing to increase teacher pay and provide more resources for public education. "I think our focus on education was evident," said House Speaker Joe Hackney, D-Orange. The bill would raise teacher and community college instructor pay by an average of 5 percent, while giving most other state employees a 4.25 percent pay hike. The House also agreed during floor debate to raise the amount of Medicaid relief for counties from $60 million to $100 million. Although welcome, county governments had sought legislation that would completely relieve them of Medicaid costs -- about 5 percent of the total program amount. THIS CHANGE WOULD INCREASE HARNETT COUNTY’S MEDICAID REIMBURSEMENT FROM $510,711 TO $1,003,094. Republicans gave two reasons for voting in block against the budget bill: the level of spending increase, and the continuation of sales and upper income tax hikes adopted as temporary in 2001 and partially repealed last year only to be continued for two more years. "We need to restore our credibility. We should have kept our word," Rep. John Blust, R-Guilford, said of the tax hikes. The bill does create a state Earned Income Tax Credit for the working poor, at a cost of $68.9 million in the second year of the two-year budget. It also sets aside $14.5 million in reserves in anticipation of creating renewable energy tax breaks for business and farmers, restores a long-term care insurance tax credit and an adoption tax credit. The plan calls for $315 million to be put into the state's Rainy Day Fund, bringing the reserve up to more than $900 million. Another $170 million would be spent on new university and state building projects, while $449 million in borrowing -- financed by certificates of participation -- would also go to construction. More than 50 amendments were drawn up for consideration on the House floor Monday. After some were withdrawn and others ruled out of order, around three dozen were considered. Other than Medicaid relief, no other significant changes passed. House members overwhelmingly rejected proposals to curb increases in the legislative tuition grants that benefit North Carolinians that attend private colleges within the state. An amendment that would have eliminated free public university tuition for the graduates of the N.C. School of Science and Math also failed. (THE INSIDER, 5/11/07) BUDGET HIGHLIGHTS: Highlights of the $20.3 billion 2007-08 state spending plan given House approval early Friday morning. The figures reflect increases or reductions to base budget expenses, some of them based on projected rises in recurring spending. Salaries and benefits -- Average 5 percent salary increase for public school teachers; 5 percent for community college faculty and judges; 4.25 percent for most state employees and university workers: $558.1 million. -- Additional 31-year salary step for public school teachers: $9.9 million. -- Two percent cost-of-living adjustments for state retirees: $29.6 million. -- Fifth and final installment of retirement funds intercepted in 2001 to narrow budget shortfall: $45 million. -- Higher patient out-of-pocket costs, cash influx to cover projected shortfall in state employee health plan: $134 million. Public schools -- Replace 151 fewer school buses next year: -$4 million. -- Student performance bonuses for teachers: $70 million. -- Provide more funding for low-wealth school districts: $20.3 million. -- Expand "Learn and Earn" high school initiative to 12 more schools: $3.4 million. -- Deliver college courses electronically to high school students through Gov. Mike Easley's Learn and Earn Online program: $6.4 million. -- Upgrade public school broadband connectivity: $12 million. -- Hire school safety officers at middle schools and high schools: $2 million. -- Increase school district funding for instructional supplies and materials: $3 million. -- Increase district funding for academically and intellectually gifted programs: $1.8 million. -- Increase district funding for children with disabilities: $5 million. -- Provide additional money to help small-county school districts: $1 million. -- Support mentors for beginning principals: $2.9 million. -- Hire 60 literacy coaches in schools with eighth grades: $3.4 million. -- Support pilot programs for Chinese, Farsi and other critical foreign languages: $1 million. -- Establish district dropout prevention competitive grant program: $7 million. -- Supplement funding for elementary school cafeterias operating in a deficit: $7.5 million. -- Train mathematics teachers in financial literacy: $250,000. University of North Carolina system -- Direct campuses to cut 188 middle management positions: -$18.7 million. -- Eliminate N.C. Progress Board: -$228,000. -- Reductions of 23 positions, other spending cuts recommended by President's Advisory Committee on Efficiency and Effectiveness: -$4.1 million. -- Provide tuition grants to 1,000 additional students attending private colleges in North Carolina, raise grant to $1,950 and expand to part time students: $5.5 million. -- Provide need-based financial aid for more than 46,500 students at UNC campuses: $27.6 million. -- Indigent care services at East Carolina University outpatient center and UNC Hospitals: $3.5 million. -- Equipment for UNC-leased buildings at North Carolina Research Campus in Kannapolis: $1 million. -- Improve N.C. Central University law school to address American Bar Association accreditation recommendations: $2.5 million. -- Begin Education Access Rewards North Carolina Scholars program, which provides up to $4,000 grants to low-income college students: $25 million. Community colleges -- Fund enrollment for additional 2,300 students: $3.3 million. -- Increase community college tuition by 6.3 percent: -$7.5 million. -- Additional funds for Allied Health programs: $2 million. -- Improve community college broadband connectivity: $3.9 million. -- Purchase of instructional equipment: $10 million. -- North Carolina Motorsports Consortium funds: $500,000. -- Operational funds for N.C. Military Business Center: $500,000. -- Competitive grant program for campuses for facility and equipment needs: $13 million. Health and Human Services -- Sustain provider network that coordinate free care for low-income uninsured patients: $2.3 million. -- Reduce child care subsidy waiting list by 2,000 children: $8.4 million. -- Fund 1,050 scholarships for child care providers studying early childhood education or child development: $1.1 million. -- State match to purchase more than 650,000 treatment courses of antivirals in case of pandemic flu and create climate-controlled storage space: $9.7 million. -- Fund HIV prevention and activities, including counseling and testing: $2 million. -- Help local health departments: $4 million. -- Family planning services to uninsured women ineligible for Medicaid: $200,000. -- Hire 80 public school nurses: $4 million. -- Fund tobacco "quit line": $1 million. -- Reduce Medicaid provider inflationary reimbursement increases by 50 percent, with some exceptions: -$27 million. -- Medicaid cost containment activities, including increased fraud and abuse detection: -$13.3 million. -- Eliminate Medicaid coverage of orthotics and prosthetics for adults: -$492,000. -- Two hundred additional slots for Community Alternatives Program: $3 million. -- Expand Medicaid coverage for foster care adolescents age 18-20: $216,000. -- Create N.C. Kids Care, which provides health care coverage to 11,800 children in families that earn between 200 percent and 300 percent of poverty level: $4.7 million. -- Fully fund N.C. Health Choice program: $7.5 million. -- Reduce funds for mental health, developmental disabilities and substance abuse services based on historical availability of funds: -$2.3 million. -- Realign mental health, developmental disabilities and substance abuse services for other programs: -$21.2 million. -- Reduce budget of Dorothea Dix Hospital in Raleigh to account for anticipated closure in the fall: -$32.6 million. -- Reduce budget of John Umstead Hospital in Butner to account for anticipated closure in the fall: -$33.9 million. -- Open and fund new central regional psychiatric hospital in Butner: $61.9 million. -- Transfer half of forensic unit from Dorothea Dix Hospital and Broughton Hospital in Morganton: $4.7 million. -- Fund local substance abuse programs: $7.3 million. -- Fund local crisis services to mentally ill and find employment for mentally ill, developmentally disabled and substance abusers: $6.5 million. -- Nonrecurring assistance to counties to pay Medicaid expenses: $100 million. Natural and Economic Resources -- N.C. Agricultural Development and Farmland Preservation Trust Fund, designed to prevent loss of farmlands: $8 million. -- Hire two agricultural safety officers to conduct migrant housing inspections and train farmers: $125,000. -- County grants to adopt local programs to enforce statewide private well construction standards: $300,000. -- Test private wells for contamination and pay for alternative drinking water supplies: $615,000. -- Shift funding for N.C. state aquariums from appropriation to admission receipts: -$3.2 million. -- Matching funds for clean water, drinking water revolving funds: $9.4 million. -- Market Blue Ridge Parkway's 75th anniversary: $100,000. -- Eastern and western North Carolina film commission funds: $100,000. -- Promote state's grape-growing industry: $1 million. -- Create N.C. Green Business Fund, providing no-interest loans to small private business to encourage environmentally based economy: $1 million. -- One North Carolina Fund for economic development: $13 million. -- One North Carolina Small Business Fund for economic development: $4.8 million. -- Operate N.C. Center for Automotive Research in Northampton County: $3.5 million. -- Help Johnson & Wales University in Charlotte: $1 million. -- Increase funding for N.C. Institute of Minority Economic Development: $1 million. -- N.C. Community Development Initiative: $5 million. -- N.C. Minority Support Center: $4 million. -- Support Defense and Security Technology Accelerator, a business incubator to boost economic development in homeland security and defense industries: $1 million. -- Expand N.C. Rural Economic Development Center Economic Infrastructure Fund and establish Rural Economic Transition Program: $19 million. Justice and Public Safety -- Create two new positions for Judicial Standards Commission: $193,000. -- Hire 30 assistant district attorneys, nine victim witness or legal assistants: $3.4 million. -- Funds 58 new deputy clerk positions in Superior, District courts: $2.3 million. -- Funds for new three District Court judge positions: $443,000. -- Raise hourly rate for privately assigned attorney for indigent defendants in non-capital cases: $5 million. -- Hire more sworn agents, staffers and technicians at State Bureau of Investigation, startup cost for Triad regional crime laboratory: $1.6 million. -- Staff and contractual service costs for flood plain mapping program: $4.1 million. -- Grant to N.C. Sheriff's Association for technical assistance and training association with immigration enforcement, contingent on passage of other legislation: $750,000. -- Gang prevention, intervention and suppression initiative grants, contingent on passage of other legislation: $4.8 million. -- Reduce backlog of victims' compensation unpaid claims: $1.6 million. Transportation -- Reduce Department of Transportation division administration funds, in part to pay for Interstate 40 resurfacing project: $30.7 million. -- Purchase one aircraft to upgrade department fleet: $3.4 million. -- Replace obsolete State Highway Patrol helicopter and establish airborne unit to perform search and rescue operations during disasters: $3.6 million. -- Hire 40 additional ferry division personnel, pay for rescue boats and generator upgrades to meet Coast Guard regulations: $5.4 million. -- Reduce expenditures for Triangle Transit Authority's commuter rail project: -$23.4 million. -- Create 24 positions to support advanced statewide emergency responder radio network: $2.8 million. -- Reduce intrastate and urban loops system money allocated from Highway Trust Fund: -$5.7 million. Other agencies and funds -- Increase funding for rape crisis and sexual assault funds: $883,000. -- Funds to Department of Cultural Resources to protect and preserve abandoned cemeteries: $133,000. -- House remains of Civil War Confederate ironclad CSS Neuse: $500,000. -- International Civil Rights Museum: $500,000. -- Increase operational support for Queen Anne's Revenge archaeology project: $150,000. -- State aid to local libraries: $475,000. -- N.C. Housing Trust Fund, including money to build apartments for people with disabilities: $12.5 million. -- Continue home foreclosure protection pilot program: $1.5 million. -- Hold special bond referenda in November: $300,000. -- Reserve for morale, recreation and welfare fund distributed to military installation: $1 million. Reserves and capital projects -- Continue upgrade of state's human resources, payroll and financial systems: $20 million. -- State Energy Office reserve: $10 million. -- University of North Carolina Distinguished Professors Endowment Fund: $6 million. -- N.C. Court of Appeals building renovation: $10.5 million. -- N.C. Museum of History chronology exhibit: $6.3 million. -- Equipment for state secondary data center: $7 million. -- Construct new buildings at eastern and western agricultural centers: $8 million. -- N.C. Ports improvements in Morehead City, Wilmington: $7.5 million. -- Phase II construction of UNC-Chapel Hill genomics building: $44 million. -- Appalachian State University education building: $9 million. -- Special indebtedness for construction projects, including prison additions, construction of new Department of Environment and Natural Resources building, Tryon Palace visitors center and university projects: $449 million. Tax provisions -- Extend state portion of sales tax at 4.25 percent: $258.4 million. -- Extend individual income tax rate for top wage earners at 8 percent: $40.8 million. -- Reserves for energy tax phaseout provisions, military tax relief and work opportunity tax credits: -$24.5 million. -- Renew long-term care insurance tax credit: -$7 million. -- Adoption tax credit equal to 50 percent of federal credit: -$3 million. (THE ASSOCIATED PRESS, 5/11/07) PROSECUTORS WEIGH IN: Despite helping sue former Democratic House Speaker Jim Black and other officials while working as a private lawyer, U.S. District Court Judge James Dever III should remain on Black's case, prosecutors said Friday. ETHICS COMMISSION: The State Ethics Commission says that 95 percent of the more than 4,000 state officials who must file detailed economic interest statements have done so as required under a new state law, including the entire state legislature. Commission officials also said that roughly 65 officials opted to resign rather than fill out the forms, which ask for employment, investment and real estate information to help prevent possible conflicts of interest. HOG WASTE: The House's proposed budget includes $2 million to develop and build new systems to manage hog waste, but advocates say more is needed. The 10-year moratorium on hog lagoons expires in September. A Senate bill, introduced by Sen. Charlie Albertson, D-Duplin, would provide $10 million yearly for five years to help farmers try new waste systems. It also would make the moratorium permanent and establish standards for treated hog waste. OLF OPPOSITION: The U.S. House Armed Services Committee has approved wording in a bill that would block the Navy from building a proposed practice jet landing field in Washington and Beaufort counties. The U.S. House committee’s language is not expected to be challenged when the full U.S. House votes on the Defense Authorization Bill of 2007 this week. NATIONAL GUARD: Gov. Mike Easley has called on the nation's governors to help undue expanded presidential control of the National Guard in extreme emergencies. RENOVATIONS: The building that houses the state Supreme Court opened Friday after a two-year, $9.5 million makeover. Officials said it was about time North Carolina's Law and Justice Building got rid of decades of mold, mildew and rust. Please call me if I can help. Please remember you can listen in on House Sessions, Senate Sessions, and Committee Hearings by visiting my website and clicking on the “audio-link” section.
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