Politics & Government

Highlights of the NC budget

Here’s an overview of the $21.25 billion state spending plan.

Public Education

• Spends $282 million for teacher raises averaging 7 percent, although some raises could be much larger or smaller.

• Spends $42 million to guarantee funding for one teacher per 18 students in kindergarten and one teacher per 17 students in first grade.

• Adds $18.7 million to restore salary supplements for teachers with Masters and other advanced degrees who took courses toward their degrees before Aug. 1, 2013.

• Reduces Department of Public Instruction budget by 10 percent, or $5 million a year.

Community Colleges

• Provides $1,236 increase in salary and benefits for full-time employees.

• Increases tuition by 50 cents per credit hour to $72 for state residents and $264 for nonresidents.

UNC System

• Provides $1,236 salary and benefits increases for UNC employees subject to the State Human Resources Act and provides $5 million for pay raises for exempt employees to be administered by the Board of Governors.

• Increases the management flexibility cut by $2.4 million to $76 million for 2014-15.

• Provides $3 million for “game-changing” research in areas such as manufacturing, defense and the military, energy and marine and coastal sciences.

General Government

• Eliminates eight positions – four vacant and four filled – in the Department of Insurance.

• Funds three new investigators at the State Board of Elections to investigate possible cases of voter fraud and pursue other violations of election laws.

• Pays for two new special agents in the Department of Revenue to pursue individuals and businesses with overdue tax debts.

• Spends $18.3 million to operate recently opened veterans’ homes in Black Mountain and Kinston.

Public Safety

• Transfers State Bureau of Investigation from the Department of Justice, under the elected attorney general, to the State Department of Public Safety, under a Cabinet secretary. Gives the governor the authority to appoint the SBI director for an eight-year term.

• Leaves the justice department crime lab where it is; the Senate had originally proposed moving it under the Department of Public Safety.

• Transfers the Alcoholic Beverage Control Commission to the Department of Public Safety.

• Transfers prisoners accused of misdemeanors to county jails, which allows closings and conversions of prisons. Closes Fountain Correctional Center for Women in Nash and the North Piedmont Correctional Center for Women in Davidson, converts Eastern Correctional Institution in Greene County to a facility for women.

• Provides $1.8 million to buy vehicles for the 100 new parole/probation officers handling influx of ex-offenders under Justice Reinvestment Act.

• Tells the Administrative Office of the Courts (AOC) to find $2.9 million in administrative savings.

• Cuts the AOC technology budget by 3 percent ($500,000). That’s a cut to a department that is woefully behind in technology, but AOC dodged a bullet: The original Senate budget called for a 24 percent cut.

Health and Human Services

• Reduces rates for some health care providers by 1.0 percent effective Jan. 1, 2015, for a projected $7 million in savings. The rate reduction applies to all fee-for-service providers with some exceptions such as hospital inpatient services, nursing homes and private duty nurses.

• A $16 million cut to contracts and administrative expenses across the department, except to programs that provide direct services.

• Replaces $20 million general fund appropriation to the prekindergarten program with Temporary Assistance for Needy Families block grant money and TANF emergency contingence funds on a one-time basis.

• Provides a $2 million cap for one year for group home residents ineligible for Medicaid personal care services. Maximum monthly payments are $464.30 for 33 hours of service. Must be used only for supervision and medication management.

• Replaces a $14 million general fund appropriation for child-care subsidy program with block grant funds on a one-time basis.

• Changes eligibility for child-care subsidies from 75 percent of state median income to 200 percent of federal poverty level for children with special needs. Children 6-12 are eligible at 133 percent of federal poverty level. General fund appropriation for this and other child-care subsidies reduced 34 percent to $27.1 million, due to replacing state funds with federal funding.


• Incorporates a Senate push to end

state funding – now $26 million a year in transportation funds – for driver education

classes offered in public schools, starting in July 2015. Students can be asked to pay as much as $65 for the class this year, and that fee is expected to rise after state funding ends next year.

• Halts the yearly transfer of $267,000 in

transportation funds to help pay salaries of six staffers

in Gov. Pat McCrory’s office, starting in July 2015.

• Hires 14 more driver’s license examiners to reduce wait times at busy Division of Motor Vehicles offices, and authorizes more DMV funds to produce a new-format driver’s license and to start allowing some drivers to renew their driver’s license online.

• Keeps state ferry tolls unchanged – now collected on three routes, with options to start charging tolls in the future on the other four routes. The House had proposed getting rid of all ferry tolls.

• Keeps highway use taxes on vehicle sales unchanged. The Senate had proposed to increase the cap on taxes that can be charged for commercial vehicles, recreational vehicles, and on vehicles transferred to North Carolina from other states.

Environment and Natural Resources

• Authorizes the governor to purchase or condemn federal land in Dare County to create an Oregon Inlet State Park, incorporating

a Senate bill

aimed at building jetties to help stabilize the inlet’s navigation channel. An accompanying provision would enable the governor to waive the need for environmental permits when needed to expedite repairs to the Oregon Inlet bridge and N.C. 12 during a state of emergency.

• Increases six commercial fishing and fish dealer license fees to provide more funding for the At-Sea Observer Program. The Standard Commercial Fishing License fee rises from $250 to $400. Retired Standard Commercial Fishing License: $125 to $200 for state residents, $162.50 to $260 for nonresidents. Shellfish license: $31.25 to $50 for state residents.

• Establishes the N.C. Commercial Fishing Resource Fund to help develop sustainable commercial fishing.

• Directs state park officials to solicit proposals for a private business that would take over operation of the state-owned marina at Carolina Beach State Park.

Special Budget Provisions

• Establishes a special oversight committee on the lottery, a 14-member board of House and Senate members to examine lottery operations and recommend changes.

• Details the process through which verified victims of the state’s bygone eugenics era will be compensated, with initial payments by Oct. 31.

• Prohibits the use of drones by state and local governments until Dec. 31, 2015, without special permission. Establishes extensive regulations regarding drone use and penalties for unlawful use.

• Establishes the N.C. Education Endowment Fund from the sale of special “I Support Teachers” license plates and other funding sources. Funds would pay for teacher compensation related to improving student performance.

• Requires schools to have emergency epinephrine injectors on hand to treat serious allergic reactions.

• Requires school principals to provide information about bullying and cyberbullying to staff, students and parents at the start of each school year.

• Requires a study of various aspects of tuition charged at University of North Carolina institutions.

• Requires a study on plans to “restore Elizabeth City State University to more financially sustainable conditions.”

• Establishes the intent of the General Assembly to work on Medicaid reform during a special legislative session in November 2014.

• Creates a grant program for film production companies in the Department of Commerce to replace existing film tax credit legislation, and provides $10 million toward the grant program in the first half of 2015. (Note: The House tentatively passed a bill Thursday to extend the current film tax credit program, with some minor changes, for a year).

• Provides 1 percent cost-of-living increases for retirees of the Teachers’ and State Employees’ Retirement System, the Judicial Retirement System and the Legislative Retirement System.

• Establishes a three-judge panel to hear lawsuits challenging on their face the constitutionality of laws the General Assembly passes.

Reported and compiled by Patrick Gannon of the NC Insider, and N&O staff writers Craig Jarvis, Bruce Siceloff and Jane Stancill.