April 12, 2010


Senators Foriest and Stevens

Representatives Glazier, McLawhorn, and Rapp

Joint Meeting with Joint Transportation Appropriations SubCommittee

Representative Cole presiding:

Driver Education Presentation: Paula Collins presented the Continuation Review of the Drivers Education program that was prepared by DPI.  She reviewed the laws regarding the Driver Education program beginning with DOT’s duties as indicated in G.S. 20-11. Next it was NC SBE G.S. 20-88.1 with the SBE being the fiscal agent for the LEAs. G.S. 115C-216 sets out the law relative to LEAs who are to provide training and instruction in the use of state resources. NC DMV-DOT rules include 6 hours of driving experience and 30 hours of classroom instruction. Driver Education must be out of the school day and there is no course credit. Students may pass a proficiency test to waive classroom instruction, but few students take the test and fewer pass it. It is mainly given to out-of-state students coming in to NC. LEAs have the authority to set up their own program some using all internal teachers and other using a combination of contractors and internal resources. The LEAs are responsible for having someone oversee and monitor the program in the district. DPI had four recommendations as part of the review report: 1) Maintain the State Superintendent as the fiscal agent for the highway funds to pay for the program 2) Driver training should remain outside the school day’s instruction 3) Review the delivery process for the program 4) review the driver eligibility certificate program.

Paul Le Sieur, Director, School Business Services, DPI presented the funding portion of the Drivers Education Program told the members each LEA is allocated $238.04 per eligible ninth grade student. The eligible students include private, federal, and charter school students. In 2008-2009 the state budgeted $34.3 million and had $2.5 million in unexpended funds. These funds are transferred once a month to the LEAs. Senator Stevens provided a handout that gave the history of the driver education funds, which were first dedicated funds in 1957 with the addition of $1 to the vehicle license registrations. Through the years another $2 was added. Presently, there are somewhere between 8-9 million registered vehicles in NC, which equates to between $24 million and $27 million in the Highway fund.

Mark Bondo, Fiscal Research prepared the staff response to the Continuation review report completed by DPI. Students must complete a driver education program and have a driver eligibility certificate to get a permit in NC. The driver eligibility certificate (DEC) was a law that passed in the late 90’s to ensure students were making progress toward graduation to be eligible to drive. It was intended to be a carrot, but looks more like a stick. Program expenses across the LEAs range from $275.00/student -$500/students. More than half of the states (32) have no funding for driver education while about 18 are fully/partially funded. There are several problems with the program There are no standards, no class size restrictions, no statewide outcomes, the driver eligibility certificate is not being enforced using the same standard, the DMV computer system is limited in its support of the DEC and there is no lead state agency overseeing the program . Fiscal staff was very critical of driver education program noting there was no empirical data to indicate the driver education program prevented crashes. Four recommendations 1) full study by the program evaluation committee 2) Continue funding until this study is complete 3) Reviewed other funding options for the program 4) cut 2010-2011 funding $1.15 million. It was noted the actual per student cost had been decreased over the years from a high of more than $250.00 per student. Representative Cole wants these funds left in the Highway fund and insists Driver Education should be paid for in the Education appropriations.  The issue is it is getting late in the fiscal year to take the funding provided through the license registrations and eliminate it, and require Education appropriations to find the new resources. The plan appears to be to require a better study from the program evaluation division and based on their recommendations make some decisions for as early as 2011-2012.

Education Agencies’ Budget Reduction Options: Philip Price, Chief Financial Officer for DPI presented the public school’s budget options. The Governor’s office requested a recommendation for an additional three percent cut to the public schools budget. A three percent cut is $214,118,273, based on the 2010-2011 base budget for public schools. This cut does not include the continuation adjustment cut of $4,845,504 or the annual average salary adjustment (reversion 2009-2010) of $44,950,676. Based on the cuts in the 2010-2011 budget the only area in the budget with sufficient resources, that was agreed upon by the Office of State Budget and Management, was the teacher assistant’s allotment. If this allotment is cut by three percent, it would mean the loss of 7,389 TA positions (41.77 percent of total funding).  A three percent cut to More at Four would reduce their funding by $2,421,461. A three percent reduction to DPI would require $2,895,486 and this amount would require cuts to DPI, Teacher Academy, NCCAT, Dropout Grants and the Non-Profits.  Philip noted the reversions from the public school fund are expected to be $64 million this year, which is less than the 1 percent usually projected. Questions were raised about the higher than anticipated salary adjustment of $44,950,676, which usually amounts to about $30 million. Members pressed him on which grade level TAs should be cut and he indicated it was just a cut with no direction on the grade levels. If the teacher assistant allotment is reduced by $214 million, LEAs will still have the flexibility to move funds between allotments to hire Teacher Assistants.

Jeff Davies, UNC General Administration came and discussed the harm in making further cuts, but provided no specific information to the committee through a handout.

Scott Ralls, President of the Community College System presented his recommendation for a three percent cut as requested by the Governor. The reduction of $28.6 million was made by requesting a two percent management flexibility cut and allow each community college to determine the cuts from their area. He also requested a $3 per credit hour tuition increase with 25 percent of the funds going to need-based financial aid to make up the remaining cut.

There was very little discussion though the Chairman requested the University to provide their specific cut recommendation by Friday.

State Budget Calendar: Governor’s Budget April 21, Joint Subcommittees Report April 23

Senate Passes Budget May 28, House Passes Budget June 10,Adopt Conference Report Budget June 29

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