Politics & Government

Here is where NC’s budget stands a month after governor’s veto

It is nearly a month into the new fiscal year, but North Carolina still does not have a budget.

Democratic N.C. Gov. Roy Cooper vetoed the General Assembly’s budget proposal on June 28.

A vote to override Cooper’s budget veto has remained on the House calendar since July 8, but Speaker Tim Moore has yet to call for a vote. Republicans need at least eight Democrats, in addition to all Republicans in the chamber, to have the supermajority required to override a veto in the House.

Medicaid expansion remains at the heart of the budget negotiations, and negotiations have stalled out over the issue.

Whenever the House has been in session, the potential override vote sits on the agenda under “unfinished business” along with NC Health Care for Working Families, the Republican’s Medicaid expansion compromise bill. A federal judge struck down a state’s work requirement for Medicaid on Monday, but that House bill has yet to be discussed on the floor, so it may not impact budget negotiations.

Monday night’s House session came and went without a vote, too. Several Republican representatives were absent, including Moore.

Cooper counter offer

Cooper presented a budget counter offer on July 9 that includes an increase in teacher pay by an average of 8.5% over two years; higher state employee pay raises; a 2% cost-of-living adjustment for retired state employees; and studying the best place to house the Department of Health and Human Services. Now, in the conference budget negotiated by the House and Senate, the department will move from Dix Park in Raleigh to Granville County.

Sen. Jay Chaudhuri, a Raleigh Democrat, held a town hall last week for DHHS employees. Several said they would have to quit if the headquarters relocated, citing commute time and childcare as reasons.

Republican General Assembly leaders have not submitted a counter offer. Cooper has blamed Republican leadership for holding up negotiations. He has said that he wants Medicaid expansion to be part of the budget negotiations.

On the Senate side, Senate leader Phil Berger told reporters earlier this month that the problem with budget negotiation conversations “are predicated on, you have to pass something that satisfies the governor on Medicaid expansion before you can get to anything else.”

The conference budget vetoed by Cooper includes calling for a special session of the General Assembly to discuss Medicaid expansion.

“We’re talking about billions of dollars coming down; the budget is the place where this needs to be debated and decided,” Cooper told reporters earlier this month.

Medicaid issues

The Senate Democratic Caucus on Monday said that another issue, Medicaid transformation, is being held up by the new budget. Medicaid transformation moves current Medicaid users from fee-for-service to managed care, a decision made by legislators in 2015. Open enrollment for some counties has already started, but the Caucus said in a statement that success of first phase rollout is tied to funding in the new budget.

On Tuesday, Cooper is scheduled to have another Medicaid expansion roundtable with people who fall in the coverage gap and would benefit from the expansion.

Cooper’s office sent out a statement on Monday to note the 21 days that have passed since Cooper’s counter offer to Republicans.

Rather than returning a counter offer, Cooper wrote that Republicans are “choosing to instead spend their time on a veto override effort for which they do not have the votes.”

Monday, NCGOP spokesperson Jeff Hauser called Medicaid expansion Cooper’s “pet project” in a statement about the budget.

“Hurricane relief funding, teacher and state employee raises, and a portfolio of statewide community enhancement projects are stuck in Gov. Cooper’s political spiderweb as he chooses to hold them hostage over one pet project,” Hauser said.

Meanwhile, the House and Senate have passed stopgap measures to make sure some federal funding continues. And last year’s budget rolls over to this year until the new budget is passed.

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Dawn Baumgartner Vaughan covers North Carolina state government and politics at The News & Observer. She previously covered Durham for 13 years, and has received six North Carolina Press Association awards, including a 2018 award for investigative reporting.