2009 LEGISLATIVE SESSION MEMO #5

The Joint Appropriations Committee met on Tuesday to discuss the Federal Stimulus Package in the American Recovery and Reinvestment Act of 2009 and how it might impact Education funding in North Carolina. A one-page summary was sent out on Tuesday.

The Governor’s bill, SB 198 was presented by Senator Stevens, in House Education on Tuesday, and for almost 45 minutes members grilled him on many aspects of the bill. They were trying to debate the Governance issue and that is not what is in the bill. Simply the bill is intended to allow the Governor to employ Bill Harrison as Chief Executive Officer of DPI and appoint him to the State Board of Education, as a paid public school employee. The law only allows for one board member to be employed and paid with public school funding and there is already a Board member serving who is a full time teacher. The bill received a Favorable Report at the end of the meeting with a technical amendment and then was sent to State Government and Personnel where it again received a Favorable Report. It was on the House floor Thursday and passed 109-3. It was sent back to the Senate by Special Messenger and is on the Senate calendar for final approval of the amended bill on Monday, March 2.

On Wednesday, the Joint Finance Committee met to review the Federal Stimulus package as it relates to tax credits and the impact on NC revenue loss. The tax cuts may mean a $215 million loss in 2008-2009 and $370 million in 2009-2010. The majority of cuts are related to Business Incentive cuts. These cuts are temporary and will expire in two years. There is also an additional $100 million in tax cuts that were implemented by the Federal government last year, after the 2008-2009 budget had passed, which may need to be considered.

The Joint Education Appropriation Committee met this week to hear from President Ralls of the Community Colleges and Philip Price, Finance Officer of the Department of Public Instruction. Dr. Ralls talked about where the critical funding is needed for Community Colleges. He mentioned possible program cuts and the need for $47 million in enrollment funding.

Dr. Bill Harrison, Superintendent of Cumberland Schools, soon to be Chief Executive Officer of DPI and Chairman of the State Board of Education addressed the committee on Thursday. He emphasized the importance of technology, addressing the graduation rate, Learn and Earn and other programs. He answered a series of questions by members and then he turned it over to Philip Price. Mr. Price addressed the budget cuts to education, reversions and the budget deficit impacting public schools this year. On September 18, 2008, public schools were requested to reduce their budgets 1 percent and 2 percent to DPI ($78,000,000). On November 4, 2008, there was another 1.5 percent reduction to public schools and 4 percent to DPI ($117,000,000). On January 15, 2009, there was a third request for 3 percent from public schools and 6 percent for DPI ($158,948,312). The source of the reductions includes: LEA reversions $58 million, agency reversions of $100.9 million, 10 percent ($4.6 million) from DPI, school bus fuel ($35 million), ADM contingency reserve ($14 million), prior year funds ($14 million), and natural reversions ($33.2 million). On February 25, 2009, DPI transferred the last quarterly lottery construction funds, $37,632,989 that were to be released to the LEAs and $5,621,104 from the Corporate Fund for school construction, to enable the state budget office to handle existing bills. In addition, the Governor is holding $50 million from the Lottery Reserve Fund, $100 million of the Corporate Funds ($316 million total in the fund-$120 million undesignated), and $50 million from the Textbook Fund ($65 million total) to handle additional state revenue needs for the remainder of the budget year. It is possible Governor Perdue may use some of the $258 million in State Fiscal Stabilization Funds (flexible allotment) to restore the cuts made to school construction funding. Mr. Price was asked about the cut to public schools in the fall. A list of the funds relinquished by each LEA was provided (Wake-$5,478,413). The cut was based on average daily membership. He also mentioned the declining enrollment in public schools across the state. The state has budgeted approximately 25,000 new students each year over the past few years and in 2008-2009 that number only reached 6,000.

The Governor is expected to give her State of the State address on Monday evening, March 9, 2009. Following her address she plans to release her budget later in the week. The Senate will take several weeks after she sends her budget to the Legislature to complete their budget and then off to the House who will work on their budget plan. The budget and the health plan seem to be consuming everyone’s time right now. Bill introduction deadlines are approaching and it doesn’t appear that they will reach the numbers of bills introduced in the 2007 Session.

 

Bills Introduced:

House

HB 264 DPI/Curriculum on 1898 Wilmington Race Riot

HB 268 School Capital Fund Formula/Lottery Proceeds

HB 282 Green School Construction/Loan Fund

HB 283 Clarify Broadband Internet Access Definition

HB 284 Extend Renewable Energy Credit Sunset

HB 285 Salary Increase for Substitute Teachers

HB 288 Remove Cap on the Number of Charter Schools

HB 299 Reinstate LEA Sales Tax Refund

HB 302 Wake School Board Elections

HB 308 PTA Parental Involvement/Dropout Prevention Funds

HB 311 Continue School Construction Funding

HB 324 Stimulus Funds/Contractor Must Use E-Verify

HB 329 Retired Nurse Return to Work

HB 335 Tax Fairness in Education

HB 338 Stimulus Funds/Contractor Must Use E-Verify

HB 339 Taxpayer Transparency Act

HB 344 Employer Must Use Federal E-Verify Program

HB 348 Modify Education Requirement/School Board Members

HB352 Lottery School Capital Fund Formula

HB 354 Funds for School Health Centers

 

Senate

SB 265 Fund Only One School System Per County

SB 273 School Nutrition Program Funds

SB 281 Funds for Healthy Carolinians

SB 283 Funds for School Health Centers

SB 287 State Health Plan $/Good Health Initiatives

SB 297 No Sunset/Teacher Personal Leave Provision

SB 306 New Assistant Principals/No Pay Decrease

SB 312 LEA Sales Tax Refund

SB 314 Funds for Center for Advancement of Teaching

SB 320 Study Raising Compulsory Attendance Age

SB 321 Encourage Policies to Facilitate Graduation

SB 322 Communities in Schools Funds

SB 323 Funding for Learn and Earn

SB 335 Transparency in Recommendations

SB 337 NC Illegal Immigration Reform Act

 

House Committees:

Education:

HB 43 School Board Members/Failure to Discharge Duty Favorable Report and re-referred to Judiciary II.

HB 79 Extend School Formula Study Committee Favorable Report to Committee Substitute and re-referred to Rules, Calendar and Operations.

SB 198 State Board of Education/Membership Restrictions Favorable Report to Committee Substitute and re-referred to State Government/State Personnel.

State Government/State Personnel:

SB 198 State Board of Education/Membership Restrictions Favorable Report

Health:

HB 18 Speech Language Pathologist Qualifications Favorable Report and re-referred to Finance.

Judiciary II:

HB 43 School Board Members/Failure to Discharge Duty Favorable Report

Judiciary III:

HB 205 Lottery Act Changes-Favorable Report to Proposed Committee Substitute and re-referred to House Finance.

HB 134 Assault State or Local Officer or Employee Sent to Subcommittee

 

House Floor:

SB 198 State Board of Education/Membership Restrictions House Committee Substitute Passed second and third reading and returned to the Senate. No discussion.

 

Bills in Committee Next Week:

HB 42 Science Safety in the Public Schools

HB 65 Students Under 16 May Attend Community College

HB 187 Encourage Policies to Facilitate Graduation

HB 193 Electronic Notice of Public Hearings

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