Sept. 25, 2023
North Carolina lawmakers gave final approval to House Bill 259, the state's $30-billion budget, on Friday morning. Governor Roy Cooper announced that he would allow the budget to pass without his signature, citing Medicaid expansion as the primary reason. “I will not allow people who are crying for help to wait any longer, so I am directing our Department of Health and Human Services to begin today the process for expanding Medicaid while allowing this budget to become law without my signature," said Cooper.
The spending plan was approved by the House on a vote of 70 to 40, which was cast after midnight on Friday with several House Democrats joining Republicans in approving the measure. The Senate passed the bill in a 26-17 final vote Friday morning. No Senate Democrat voted in favor of the legislation.
A week ago, chamber leaders were at odds over whether to include a clause to legalize more casinos, making agreement on the budget almost impossible. A historic agreement to extend Medicaid coverage to thousands of the working poor in the state was at one point in jeopardy due to the impasse. The push to legalize casinos has been put on hold, at least for this year's session, according to Senate leader Phil Berger (R-Rockingham) and House Speaker Tim Moore (R-Cleveland), who received vocal opposition from social conservatives.
Despite the fact that the budget includes Medicaid expansion, a top priority of Democrats for years, every Democrat in the state Senate and all but a small number of Democrats in the House opposed it in initial votes on Thursday. They argued that there were too many other objectionable elements in the budget, such as additional tax cuts, underwhelming pay raises for state employees, and hundreds of millions of dollars in new tuition voucher funding for private schools.
A sampling of provisions to be included in the budget deal can be found below.
Pay Raises for Teachers and State Employees:
The bill provides that most state employees would receive raises of four percent this year and three percent the following year. Public school teachers would experience a range of salary step increases, from 3.6 percent over the next two years for teachers with more than 15 years of experience to a nearly 11 percent increase for beginning teacher pay from $37,000 a year now to $41,000 by the 2024–25 school year.
A one-time, four percent cost-of-living bonus would be given to retired state employees. An earlier House plan called for making the increase permanent.
The budget plan would provide more than $4.7 million to local boards of education to increase pay for school bus drivers, with a total raise of nine percent for drivers over two years.
Tax Cuts:
The legislation would hasten already-planned state income tax reductions, which was a top priority for Senate Republicans. However, the measure places restrictions on those reductions due to revenue triggers that House Republicans sought.
The goal is to reduce the current personal income tax rate of 4.75 percent, which applies to anyone earning more than $12,750 per year as a single person or $25,500 for married couples, to 3.99 percent by 2025. The rate could drop as low as 2.49 percent in the years after if revenue collection thresholds are met.
The budget would also put a cap on the franchise tax that companies must pay to the state. Several tax exemptions for industries are also included, as well as increased incentives for the boating and aviation sectors.
A new tax on ride-sharing services like Uber and Lyft that ranges between one percent and 1.5 percent is also included in the bill.
Education:
The budget's education provisions include a one-year extension of the date by which public schools must implement the Parents' Bill of Rights to January 1, 2024. One of the many requirements of the new law is that parents be informed if their child wishes to use a different name or pronoun. There are also new limitations on discussion of the LGBTQ+ community in elementary school classes.
The budget would also increase funding for the state's Opportunity Scholarships school voucher program by hundreds of millions of dollars while restricting the State Board of Education's ability to withhold funding from charter schools. Governor Roy Cooper and other Democrats have vehemently opposed the program, saying they think it diverts money from public schools. It would also make the program accessible to all families in the state rather than capping the vouchers based on income. By 2032, the program's annual spending would exceed $500.
Families earning 200 percent or less of what is necessary to be eligible for the federal free and reduced lunch program are the only ones who can currently apply for Opportunity Scholarships.
A family of four making $55,500 or less annually would be given first priority under the new plan, followed by those making $111,000 or less annually and then those making $249,750 or less annually. Any unspent money would then be made available to households with incomes above these levels.
State Board of Community Colleges:
Through a number of governance changes, including a new requirement that the system president be confirmed by the General Assembly, the legislature would gain new authority over the state's community college system. Currently, that hire is made by the system board.
NC Innovation:
In each of the following two years, $250 million will go to a brand-new nonprofit organization called NC Innovation. The organization wants to assist university research and development initiatives from the region in becoming prosperous start-up businesses. Although it is less than the $1.4 billion the Senate originally proposed, the amount is still higher than what the House and the governor originally suggested.
Online Gambling:
The bill includes new restrictions on the North Carolina Lottery's ability to provide casino-style online games, which was a concern after the Lottery Commission approved the sale of digital instant games starting in November. According to Senate leader Phil Berger, lawmakers are concerned that the commission's decision "might actually provide folks with basically a casino on their phone."
The measure also rewrites a crucial section of the sports gambling law, which was passed earlier this session but has not yet been put into effect. The new language eliminates the cap of 12 mobile betting operators and requires that operators have a "written designation agreement" with a professional sports team, the owners of specific significant sports venues, and NASCAR or the PGA Tour. Under the law, mobile sports betting must be operational by June 15, 2024.
Court / Justice System Changes:
The legislation would increase the retirement age for judges of the state Supreme Court and Court of Appeals from 72 to 76, allowing Republican Supreme Court Chief Justice Paul Newby to continue serving on the bench for a longer period of time. Since the justices of the Supreme Court are elected, the modification would help preserve the Court's 5-2 Republican majority.
In accordance with a privilege already granted to judges sitting in the state's district and superior courts, the budget would permit state Supreme Court justices and Court of Appeals judges to carry concealed weapons while in court.
The bill overhauls the Judicial Standards Commission, which oversees judicial investigations and sanctions, taking away the State Bar Council's appointment power and giving the four positions to the majority-Republican legislature.
Similar to other state employees, judges, and court administrators will receive pay raises over the next two years.
Healthcare:
The budget allows for the expansion of Medicaid to approximately 600,000 people in North Carolina, the majority of whom are low-wage workers who will now be eligible for health benefits provided by the federal and state governments.
In addition to the pay increases for state employees, the General Assembly allocated a large portion of the federal bonus to mental health priorities, including $20 million in bonuses and incentive pay for staff members of the state's psychiatric hospitals. The spending plan also raises rates paid to providers of mental health and drug use services by about $130 million over the next two years.
Additionally, the plan increases the N.C. Department of Health and Human Services' authority over regional mental health organizations that receive state funding. People who are dissatisfied with the services they are receiving from their local mental health agency will also be able to switch providers, which was not previously possible thanks to the policies outlined in the new spending plan.
As has been demanded by child welfare advocates for years, the budget dedicates $80 million over the next two years to support services for troubled families with children who have mental health needs.
Also included in the budget is a more than $170 million increase in the rates paid to nursing homes.
A wide range of benefits for rural healthcare are included in the budget, including:
The new program that would enable UNC Health and ECU Health to work together on an endeavor to be called NC Care is the biggest benefit coming to rural counties. Three rural health clinics are expected to be built over the course of the upcoming fiscal biennium with the help of $420 million in funding, including $150 million for rural hospital investments, $50 million for a new children's behavioral health hospital, and $10 million to kickstart the collaboration.
Other Policy Measures:
Some other policy measures contained in the budget would:
Read more by WRAL News (NC Capitol Staff) / WRAL News (Doran and Specht) / WRAL News (Fain and Murphy)
Read more by WUNC (Campbell - 9/19/23) / WUNC (Campbell - 9/20/23)
Read more by The News & Observer
Read more by The Carolina Journal
Read more by NC Health News (Rose Hoban and Anne Blythe) / NC Health News (Baxley & Hoban)
Republican lawmakers finalized legislation that would overhaul state and county boards of elections ahead of the 2024 elections. Senate Bill 749 cleared the House late Thursday and the Senate Friday morning along party-line votes.
The State Board of Elections and each of the 100 county boards would undergo major changes as a result of the bill. It would remove the governor’s ability to appoint the board members who make decisions such as where to place early voting locations, whether to declare someone ineligible to run for office, and whether to launch an investigation into claims of fraud or other wrongdoing. The bill would transfer power from the Democratic governor to the Republican-controlled legislature by giving the legislature the power to make those appointments.
Additionally, the bill would change the boards from having an odd number of members, with a 3-2 majority in favor of the party in power in the governor's office, to having an equal number of Republicans and Democrats.
Although it is anticipated that Governor Roy Cooper will veto the measure, the Republican-controlled legislature has the numbers necessary to override his veto and pass the legislation. Democrats would likely seek judicial intervention to have the change reversed if that happened. However, Republicans control the state Supreme Court — which is chosen in partisan elections — 5-2.
In a related development, House Bill 770, a scaled-back bill allowing the public access to "cast vote records," advanced quickly through two House committees and was approved on Tuesday by the full House and forwarded to the Senate Rules Committee.
Cast vote records, which are electronic logs of how each ballot was marked, are no longer regarded as public documents in North Carolina.
The purpose of House Bill 770 is to make voting records accessible to the public. To protect voters' privacy, names, and other identifying information would be removed. The overall objective is to allow people or private organizations to independently audit election results in addition to the audits the state already performs.
Democrats on the committees were still concerned that certain circumstances could allow for the identification of specific voters from cast vote records. In races or places where few votes would be cast, such as in very rural areas of the state or a Republican primary in a heavily Democratic area, opponents claimed that even though ballots would have names redacted, there are still privacy concerns about distinguishing voters' identities.
Read more by WRAL News (Fain) / WRAL News (Doran)
State legislators in North Carolina would have the authority to choose which records in their offices are made public and which ones are kept private, according to a clause in the new state budget.
Although legislators are already regarded as the custodians of their own records, current law only permits them to withhold records if they claim an exemption from the law.
The text, which is a part of the 625-page budget bill that Republican legislative leaders released late Wednesday afternoon and passed on Friday morning, "codifies a broad, sweeping legislative privilege that exempts members of the General Assembly from the public records law in its entirety," said N.C. Open Government Coalition Director Brooks Fuller.
The text is clear: "A legislator, while in office or after leaving office, shall not be required to reveal or to consent to reveal any document, supporting document, drafting request, or information request made or received by that legislator while a legislator."
After separate but related language appeared in a budget draft that leaked earlier this week, open government advocates hoped to stop this kind of change. They failed. According to Kym Meyer, litigation director for the Southern Environmental Law Center, this final language represents "the deepest cut to the Public Records Act since it was enacted."
According to Fuller, this language codifies what some lawmakers already do, but it also explicitly grants them the right to reject Open Records Act requests that other government officials are required to abide by.
Additionally, the bill repeals a state statute that, after the legislative redistricting process is complete, makes public correspondence created during the back and forth of the process public. While lawmakers are creating new election maps, those conversations are private, but current state law specifically states that after the new maps are adopted, the back-and-forth becomes public information. The new budget's language merely repeals that section of the state code.
Once the open records changes pass along with the budget, "we are totally in the dark if [lawmakers] choose to keep us that way," said Fuller.
The North Carolina Association of Broadcasters wrote to House Speaker Tim Moore and Senate leader Phil Berger on Thursday to express their opposition to the changes, calling them "antithetical to North Carolina's public records law and policy" and pointing out that they had been "made public for the very first time by publication deep inside a 600-page bill, less than 24 hours before the General Assembly may vote on it."
"Taken together, the provisions would allow any state lawmaker to make the determination whether his or her office’s own records are public or not — and then to decide what to do with the records, including destroy or sell them," said the association.
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