TAs cut, Medicaid revamped under Senate proposal

Thousands of teaching assistants would be eliminated from classrooms statewide over the next two years, the Medicaid program would be handled by a mix of managed care organizations and groups of health care providers and not all state employees would receive raises under the Senate's proposed budget.

Posted Updated

Laura Leslie
Matthew Burns
RALEIGH, N.C. — Thousands of teaching assistants would be eliminated from classrooms statewide over the next two years, the Medicaid program would be handled by a mix of managed care organizations and groups of health care providers and not all state employees would receive raises under the Senate's proposed budget.

The state Senate rolled out its budget for 2015-17 in pieces Monday afternoon, and officials said they hope to have the full $21.5 billion spending plan approved by the end of the week.

The budget would cut 5,289 TAs in 2015-16 and another 3.303 the following year for a total cut of 8,592 TAs by 2016-17 - more than half the 15,364 TAs the state currently funds. It also would change the North Carolina Education Lottery formula so only non-instructional personnel are paid with lottery proceeds.

The State Board of Education would be allowed to combine school systems in neighboring counties and would control teacher licensure, which is now overseen by the superintendent of public instruction. But the state board would be limited in its ability to grant waivers to school districts regarding the start and end dates of their school years.

The budget also would increase community college tuition by $4 per credit hour and shift driver's education from high schools statewide to the Community College System.

Medicaid reform

If approved, the state would create a Health Benefits Authority to take over management of Medicaid from the Department of Health and Human Services. Lawmakers would still determine eligibility for the program.

The authority would then contract with managed care groups and so-called provider led entities for services statewide and in specific regions to give Medicaid recipients a choice of three to five plans in which to enroll. All contract bidders would provide fully capitated coverage, meaning that the state would provide a set fee for each enrollee, and the vendor would be on the hook for any cost overruns or would keep any savings.

The budget sets aside $10 million to get the new system in place by Aug. 1, 2017. To ensure a smooth transition, employees in "essential positions" at DHHS now working on Medicaid would receive 5 percent bonuses each pay period, starting this August, and if they are still on staff when the transition occurs in two years, they would get a final bonus equal to the total of all the earlier bonuses.


The budget would eliminate $216 million in transfers from the Highway Fund to the General Fund and would increases funding for Strategic Transportation Initiative projects by $334 million, which would add 70 highway projects and allow other projects to be accelerated over a 10-year period.

About $300 million would be provided over two years to cities for maintenance of city roads. Such funding has been provided through the gas tax in the past, but the new money would be provided through an appropriation.

Unlike the House measure, the Senate plan does not change the gas tax. However, it would increase DMV fees by roughly 20 percent.

Justice and Public Safety

The budget would increase funding to the state court system by 11 percent, or $3.3 million, and includes $1.6 million in recurring funds for interpreters, jury payments and expert witnesses. Funding for the Office of the Public Defender’s capital defender office would be cut by 19 percent, and three special Superior Court judgeships would be eliminated.

The budget would allocate more than $3.5 million to medical examiners over the next two years to increase training and update equipment. It also would increase the cost of an autopsy from $1,250 to $2,800.

Seventy-two idle mental health beds at Central Prison could open under the proposal.

Teachers, state troopers, magistrates and assistant and deputy court clerks would receive a step increase in salary. Correctional officers would get a reclassification and possible pay increase depending on the custody level at which they work.

The budget also would allow the Secretary of Public Safety to reclassify administrative positions in DPS at will and would exempts “sensitive public security” information from public records law.

Natural and Economic Resources

The Senate proposal makes substantive policy changes to the Department of Environment and Natural Resources.

It would move state parks, aquariums, the zoo, and the Museum of Natural Science under the Department of Cultural Resources, which would be renamed the Dept. of Natural and Cultural Resources. Eight positions would be eliminated. It directs the new DNCR to use “dynamic pricing” to increase admissions receipts.

Meantime, DENR would become the Department of Environmental Quality. Its administrative operating budget would be cut by 7.4 percent, and half a dozen special funds within DENR would be emptied into the General Fund.

The implementation of pollution control rules for Jordan Lake would be delayed for an additional two years while lawmakers wait for results from the Solarbee pilot project in the lake. Nonetheless, $5 million from the Clean Water Management Trust Fund would pay for Solarbee projects for Falls Lake and potentially other lakes as well.

The Clean Water Management Trust Fund itself would be repurposed, more oriented toward development than conservation.

It requires owners of boats 24 feet long and over to have a “user identification number” displayed on their boats and to pay an annual fee (for a 24 foot boat, it would be $72). It also includes $13.1m for coastal dredging.

It sets aside $500,000 for a contract to study the state’s onshore natural gas resources, $1 million for buffers around military bases, and $149,000 to staff the deer farming program lawmakers are seeking to move to the Dept. of Agriculture.

The Senate plan also eliminates funding for the Mine and Quarry Safety Inspection program and for the Biotechnology Center, cuts the Dept. of Commerce budget, including the `funding for the governor's “rebranding” effort, reduces funding for Grassroots Science Museums, and restricts eligibility for assistance from the state’s spay and neuter program.

General Government

The plan creates a new Dept. of Military and Veterans’ Affairs, including a new cabinet-level secretary. It also creates the ABLE Trust Fund under the Treasurer's office to allow tax-advantaged savings for individuals with disabilities.

It adds $50,000 for an independent investigation by the state Ethics Commission, and directs the Dept. of Administration to design a Dorothea Dix memorial on the Dix campus.

It eliminates the License to Give Trust Fund and Commission and the NC Human Rights Commission.

It also directs the state to study whether it should charge agencies rent, restricts the use of personal services and information technology contracts, and sets up a new procedure for the sale or disposal of seized vehicles.

Next Steps

Senate leaders plan to run the bill through Appropriations Tuesday morning, and then Finance and Pensions Tuesday afternoon. If that schedule stays on track. the full chamber would vote on the measure Wednesday and Thursday.

After that, it goes back to the House, where it's almost certain to be sent to conference committee. At that point, negotiations between the two chambers begin in earnest.

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