Highlights, fiscal and budgetary actions

              OVERVIEW:
FISCAL AND BUDGETARY ACTIONS
NORTH CAROLINA GENERAL ASSEMBLY
1999 SESSION
PREPARED BY
THE FISCAL RESEARCH DlVlSlQN
OF THE NORTH CAROLINA GENERAL ASSEMBLY
RALEIGH, NORTH CAROLINA
FISCAL RESEARCH DMSION
+ JAlMES D. JOHNSON, DIRECTOR
Rm. 619, Legislative Office Bunding
Raleigh, North Carolina 276133-5925
Telephone: (919) 733-4910
Fax: (919) 715-3589
Budget Dwelapment
Appropriations Bill Coordination
Governmental Operations
Capital Budgetinfllanning
State LandsBuilding
Salaries md Benefits
General Government
Administrati on
Administrative Rdes Review Commissian
Board of Elections
Cultural Resources
General Assembly
Governor's Office
hurance
Licensing Boards
Lieutenant Governor
Oflice of Administrative Hearings
Revenue
Secretary of state
State Auditor
State Budget md Management
State Tteafllrer
Justice aad Public Safety
Coxlrection
Crime ControI & Public Safety
Judicial
Justice
Senate - Linda Powell
Senate - Andy Willis
House - Lynn Muchmure
House - Janice Wheeler
Sam Byrd
Stanley Moore
Mark Trogdon
Marilyn Chism
Michele Nelson
Jim Mills
Charles Perusse
Elisa Wolper
Health and Human Services
Department of Health and Human Sewices Kmn Hammonds-Blanks
Carol Shaw
M a q Ellen Sylvester
Natural and Economic Resourc~
Department of Agriculture
Depment of Corn-
Depmtment of Environment, Health,
and Natuzal Resources
Dqmtment af Labor
Jennif' Hemm
Jennifer HofEnann
Mona Moon
Evan Rdewdd
Bob Weiss
Education
Department of Public Inshwtion
WC-Board of Governors
Community Colleges
Jim Jobon
Jirn Newlin
Charlotte Todd
Emnomy and Taxation
Revenue E h t e s
Finance Committees
Revenue Laws Study Committee
Ecowmic Issues
State Bond PnopmdS
Fiscal Trends Commission
Richard Bostic
D d Cmtts
Lindarnsaps
Martha Wdm
Senior Computer S e m m Specirllist Marsha Falkner
An= ferry
Faydean Robinson
&Mie Trivette
Debom BrIdgers
TABLE OF CONTENTS
INTRODUCTION
GLOSSARY... ................. ........................ ........... .............. ............................................................ A-1
WE TOTAL BUDGET
Summary of the Budget. 1999-01 Biennium ................................................................................ B-1
Comparison of General Fund Tax Revenue Collections.
Pe.rcent Incr.ease over .Previous Years ..................................... ..............B -2
Eamarkfng of the Year-End General Fund Credit Balance ......................................................... B-3
Condition of General Fund and General Fund Reserves ............................................................. 5 5
THE ECONOMY AND RWENUES
Economic Outlook and General Fund Revenues.. ................. :.. .................. .,. ................................ C-1
Ge n e ~Ftu nd Revenue Forecast
Baseline Forecast Prior to Tax 'Law Changes ............................................................... .. .... G5
Impact of 1 995-99 Tax Law Changes ........................................................................-..........-... C-6
Actual Forecast Including Impact of Tax Law Changes .............................................................. C-7
Baselirm Growth Rates for Major Revenue Sources - General Fund ....................... ... ..... C-8
Highway fumd Forecast ......................................................................................................... C - g
Highway Trust Fund Fanecast ...................................................................................................... C-10
FEDERAL BLOCK ORAM PROGRAMS
Histay .................................. .. ................................................................................... D - I
How the Money will be Spent in Nodh Carolina .......... ................ ......................-............. D-3
Changes to the Medkald Program. ................................................................................................ D-5
LEGISLATIVE AeTIONS: GENERAL FUND APPROPRIATIONS
General Fund Appropdations by Department lor WB8-99 ............................................................. E-7
EDUCATION
Community Colleges .................................................................................................................F.-..1..
Pubk Education ................... .. ....... ,, . ... .................................F..-7
. University of North Carolina .................... .. .............. F-15
'HUMAN RESOURCES. ...................................................................................................................G...- 1
Page
NATURAL AND ECONOMIC RESOURCES
Housing Finance Agency ............................................................................. .. ............................ H-1
Agriculture and Consumer Sewic8s ........................................................................,., ............. H-3
Labor ...............................~.................................................................................................... H-9
Environment, Heatth, and Natural Resources ...................................................... ... ........... H-12
Cominwtx ..........................................-..-.......---....-.-..-...-.--.-..-..............-.................................... H-23
State Aid to Non-State Entit-w ................................................................................................... H-31
N.C. Bioteehnobgy Center .............. .... ................................................................................. H-35
Rural E m m i c Development Center ................ .... ............................................................... M-37
State Information Processing Sewices ..................................................................... ... ....... H-39
JUSTtCE AND PUBLIC 3AFETY
Correction ......... ,. .................................................................................................................... 1-1
Crime C m 1 and Public Safety - General Fund ...................................................................... 1-13
Judicial ................................................................................................................................... 1-16
Justice ............. ................ ......... ,. ...................................................................................... 1 - 2 5
Office of Juvenile Justice ........................................................................................................ 1-30
GENERAL GOVERNMENT
Administration ................. ....... ......................................................................................................... J-1
Auditor ............................................................................................................................................. J-5
Cultural Resources ........... ... ........................................................................................................ J-7
Geneml Assembly ......................................................................................................................... J-10
Office of the Govern ................................................................................................................... J-73
Insumnce ...................................................................................................................................... 5
Office of Administrative Hearings ........... ....,. .,..,.... ...... .................................................................. J-I7
Revenue ............................... ..., .............................................................................J.-.1..9. ..........
Secretary of State ...................... .......................................................................................J..-.2.1.. ...
State Board of Elediwrs ............................ ... .......................................................................... J-24
State Budget and Management ..................................................................................................... A26
State Controller .................................. .. ....................................................................................... J-28
Treasuwr .......... . . ......... ..........................................................................................J..-.3.0..
LEGlStATfVE ACTIONS: HIGHWAY FUND APPROPRWRONS
Department of Transportation .................................... ..... .........................................................K.. -l
SALARIES AND BENEFIIS
Salary Changer for Employees Supwed by the State ..................... .. .................................... N-1
Retirement and Pension Changes for SWe and local Personnel. ............ . ........................h..l.- I0 State Employee Health Benefit Changes ...................... .... ......................................................... K13
REVENUEPEE BILLS
General Fund Revenue Bills ................................................................................................ 0-1
Highway Fund Revenue Bills ................................................................................................ 0-19
Finance BIts Affecting All Local Governments .......................................................... 0-23
APPENDM
Total State Budget by Source of Funds .................................... .... .................................... P-1
Totai General Fund Authorizations as Adjusted
to Determine Total Current Operations .................................................................................. P-2
Savings Reserve at Year Ending June 30 .................................................................. P 4
Analysis of State Portion of Federal Revenue Sharing Funds ......................................... P-5
Condition of General Fund Including Federal Revenues (Actual) ........................ ............-Pa
Earmarking of the Unreserved Credit Balance by Fiscal Year ....................................... P-11
Tax Revenues by Major Schedules {Actual) .............................................................. P-12
Authorized end Actual Revenue Collections by Fiscal Year .............................................. P-13
North Carolina Genera! fund Operating Appropriations
Excludes 1-1 Government Shared RevenMeimbum n t S... ................................ P-14
General Fund Appropriations and Unexpended Balances ..................................................... P-18
Capital lrnpmvement Authorizations ........................................................................ P-20
School Facilities Finance Act of 1987
Critical School Facility Needs Fund. .................... ... ............................................... p-21
Public School Building Funds-ADM. ........................... ......................................-. P-22
Permanent State Positio ns. ....................... ....................................................................... P-23 Summary of Pemnent Positions by Department .............................................................P..-..2 4
Ams-the-Board Salary Cost for Each Z % Increase ............................................................ P-25
Legislative Encreases ........... ......, ............................................................................................ P-26 Average Salary of Employees Subject to the Personnel Act ................................................. P-28
This volume is intended to create a "pictuPe" of what the North Carolina General Assembly
enacted within the broad area of appropriations and revenues for the 1998-99 fiscal year. It will
serve both as a technrcal record of legislative fiscal action and as a reference tool for Members of
the General Assembly, lug~slatiest aff members, State agencies, and the general public.
This document is divided into sections as follows: "Total Budget"; "The Economy, and
Revenues'" V'Federal Bkck Grants"; Mbgislsthre Actions: General Fund Appropriations'*;
"Legislative Actions: Highway Fund Appropriations"; "Capital tmprovements"; "Sa~aries
and Benefits"; "Revenue Bills"; and, 'Appendix".
Section 6, Total Budget" summarizes the fiscal atimns authorized by the General Assembly
for the 1998-99 fiscal year.
Section 6, "Tho Economy and Revenues" describes the economic and financial backdrop
against which the acttons detailed in subsequent sections are conducted.
Section 0, UFedersl Block Grants"' gwes a brief history of programs and identifies how these
funds are allocated.
Wlon E, "Legislathfa Actlons: General Fund Appropriatlans" identifies in summary
changes made to the Governor's proposals for continuation support $or each department. Special
provisions which are pertinent to that department are included.
Sections F through J identifies actions taken by me General Assembly in the areas of
education, genera! government, human resources. justice and public safety, and natural and
economic resoumes.
Section K, "tegbtatlw AcU8ns: Highway Fund AppmpdaOons" Mentifms ahns for the
Highway Fund in the same manner as addressed in Sections F through J.
Sgctbn L, MStatewIde RsserveslDebt S d c e 'klentlks acths that are not Wentflied to a
specik department, i.e., salary increases. Funds will be joumalked from reserve accounts ta
affected departmen% when each agency's sham has been i d e n M .
SectJon M, %aprtrl Improvtrments" pwvides a departmental listing of capital pmjects apprwed
during the 1995 Session. It also includes a T i of the general obligation bonds which will be
allmted aeeordingly if favored by a majority of he voters in November, 1995.
M l o n N, %alarfen and B U identif~ies salar~y increa ses, as approved, together with
changes in retirement and pension plans, health illfurarm programs, and other benefit
programs.
Ssctlon 0, uRevenue Bls" provfdaa a listing of bills authoriring various tax &awes. Five-year
f-ee incmasss are included n thk section, as well.
The "AppendW includes data mWng to mnues and expenditures of the Gemt Fund and
Highway Fund, including salary increases, reversions, aid to 10-1 gwemrnents, Critical Schml
Facilities funds, and number of permanent positions.
It is hoped that this volume wilt be useful in making legisme infomath rehting to the budget of
the State of North Carolina more accessible and provide a complete understanding of the
General Assembly's fiscal actions.
GLOSSARY
Adjusted Approptlation: Contains the total of the certified appropriation, reserve allocations, and other
transfers (i.e., as authorized by legislative authority) including Contingency and Emergency.
AntiRrcwlon Funds: Program instituted ;by the Federal government
BeglnninglEndlng Balance or Credit Balance: The funds available at the beginning or end of the fiscal
year based upon revenue collections end expenditures.
Capital Impwments: One-time appropriations for specific capital projects (new construction,
renovations, repairs and land purchases).
Carry Fornard: Funds appropriated, but unspent in the first fiscal year of a biennium - which by
authorired budget revision - are brought forvvard For expenditure in the second fisd year of the same
bienn~um. Starbng with the 1985-86 fiscal year, the practice of journatizing these entries beween fiscal
years of a biennium were discontinued. Funds have sinm been carried forward between years and
biennia by check.
Certified Appropriation: Total state monies appropriated by the General Assembly.
Contingency and Emergency [CLE) Funds: The appropriation to provMe for any purpose authorired by
law for which no specific appropriation is made or for which inadvertently an insufFscint appropriation has
bean made. Allocations from this Fund must be approved by the Council of State upon recommendahon
by the Director of the Budget (Governor).
Corrtinuatlon Budget: The pad of the State budget necessary to continue the current lwel of setvices
when adjusted for inflation, mandated rate increases such as Social Security. annuababn of programs
and operation of new facilities.
Cumnt Operatlonab: Cost associated with th daily activity of programs supported by the Sate, such as
salaries, utilities, and travel.
Plspropodonate Sham Funds: Sham (DSH) junds are Medicaid payments made to health caE
providers who &her senrices to large numbers of uninsured patients.
Entttlsments; Payment or benefit granted by law to individuals or pollitid subdivisions (i.e., dties,
count=, I-! districts).
Expansion Budget The part of #e budget which provides for new programs, expansion of existing
programs, and salary and benefit incmses.
Federal Funds: Funds appropriated by the U.S. Congress and adminisbred by Federal agencies for
support of programs at the State or low1 Iwel. Federal funds are received through block grants,
entitlement programs and specific ('cakgorieaI") grants.
Page A-l
GLOSSARY (Continued)
Federal Revenue Sharing: Program instituted by the Federal government in 1872-73 and discontinued in
1982-83 to assist statellocal governments.
General Fund: The tax and non-tax revenue collected by the State of North Carolina and deposited with
the State Treasurer for appropriation by the General Assembb to support the operations and capital
construction needs of State departments and institutions. General Fund tax revenue includes sales and
use tax, individual income tax, corporate income tax and franchise tax. General Fund non-tax revenue
includes court fees and income from the State Treasurer's investment of excess General Fund dollars
belonging to the State
Highway Fund: The tax and non-tax revenue collected by the State of North Carolina and deposited with
the State Treasurer for appropriation by the General Assembly to support the operations and capital
construction needs of the Department of TranspornZion, including the Division of Motor Vehicles and the
Highway P m f Division of the Department of Crime Control and Public Safety. Highway Fund tax
revenuer includes licenws and fees relating to the aperation of motor vehicles and Ule motor fuel lax.
Highway Fund non-tax revenue includes income from the St* Treasurer's investments of Highway Fund
dollars.
Local Government Transfers: Reimbursements for 'holding harmless" local governments due to the Tax
Reduction Act of 1985; and, Shared-Revenues resulting from changea in accounting methwokgy for
state-local shared revenues from intangibles, franchise, and beverage taxes.
Negative Resews: An authorized d u t i i n t~ the total prugrarn needs for a speflc purpose, i.e.,
management flexibility or infiationary cost adjustmen&, without ldentiilng the specific line-items afFeded.
The agencyldeparbnent must idenMy savings or excess in budgeted lineitems needs and transfer fbis
excess to affset the negative reserve appropriabon,
Nondecwrlng: T m used to denote on- revenues (windfalls reversions) or one-thne expendiim
(grant-inaid, capital).
Other Receipts: The funds m i v e d by State departments and irrstihltions for services performed, such
as patient receipts in hospitals; tuition fees in the unirersies and community colleges, or as fines for
vblatiom of State regulations.
Rainy Day Fund: One-time appropriation of $141 rnilli far the 1990-97 fiscal year. Appropriation
equaled the funds deposited to the credlt of the Ganeml Fund due to an accounting methodology change
approved by the 1990 Session to improve the financial reports of the State.
Recutrfng: Term used to denote revenues and expenditurns that will h continuing.
Revemho (Nd): Unspent appmpriat'is returned to the General Fund adjusted for carry fornard frwn
the first to Zhe second fiscal year of a biennium, Practice of caw fbtwards by purnalizlng has been
discontinued.
Special Funds: Aacounb which have no State mk dinectty apprWated to them and whose cash
balances do not revert at the end d each fiscal period Wldlife R~esoum%).
Page A-2
GLOSSARY (Curftinued)
Tax Reimbursements: State revenues disbursed to h t go vernments as reimbursements due to State
mandated tax relief measures which has a financial impact on locals. These measures include (I)
property tax on business inventories; (2) property tax homestead exemption; (3) sales tax on food stamp
purchases; and, (4) intangibles tax on money on deposit and certain accounts recenables.
Tax Sharing: Revenues collected by the State and shared wih local gwernments - intangibles,
beverages, and franchise taxes.
Total Avaifatrility: Sum of beginning cretii balance and revenue odlectrons for a fiscal period.
Total State Budget: Total dollar requirements for North Carolina State gwemment departments and
institutions, excluding inter-inba agency departmental hnsfers and expenditures.
T ransfem Among Cod-: Allocations from reserve accounts (universily, institutional progtams, salary
increase, hospitalization - medical insurance, etc.) or program transfers from one department to another
Wed upon enabling legislation.
Page A 3
THE TOTAL BUDGET
Summary of the Budget
1999-2001
Total Budget
Includes Operating and Capital Appropriations,
General Fund, Nighway Fund, Federal Funds,
Fees, Department Receipts
General Fund
Cmnt Operations
Capital Improvements-Direct Appropriation
Capital Improvements-RepairslRtnovatim
Clean Water Management Trust Fund
BaileylEmoryIPatton Lawsuit Settlement
Intangibles Tax Settlement
Snbtotal General Fund
Higbway/LZigbway Tmst Fund (A)
puition fees of Community C o U ~U,x l i d t y ;
patieat fees, licenses, fines and other dedicated
miW1 1,898.8 1,93 1.8
Notea:
(A) Reduced to reflect transfers to the General Fund and transfers ?xtwem the Kgh~y
F d an d the Highmy Tmst Fwd
COMPAIUSON OF GENERAL FUMl TAX REVENUE
COLLECTIONS % OF INCREASE OVER PREVIOUS YEAR
L
Actual
10.4%
7.2%
6.8%
13.8%
4.9%
9.7%
6.1%
8,0%
10,00?
1.0%
9.Ph
8.1%
Economic Base*
9.0%
10.2%
8.8%
5.6%
-1.3%
5.3%
7.0%
9.1%
9.9%
6.8%
92%
10.1%
*A- collections adjusted for tax law changes, delayed tax rehw processing, and other
sper;iaIfactors
NOTI?,: The high growth rates since I W3-94 under the Uecmomic base" tabulation is
due to large increases in corporate profits (coqmrate income tax) 4 capital
gains @crsod income tax).
Page B-2
Earmarking of the Year End General Fund Credit Balance
As noted on the schedule for 1998-1999, a portion of the year end credit balance is
eammked for stated purposes. This practice began with Budget Reform legislation
enacted by the 1991 General AssernbIy as amended by the 1 992 Session. The original
two purposes were to establish a Savings Reserve account and to estabIish a permanent
funding source for repairslffenovations. The 1996 Session of the General Assembly
added the Clean Water Management Trust Fund.
Savings Reaerre
Existing law requires that one-fourth of the year end Gend Fund credit balance or the
amount to reach the cap (5% of the paeding year's General Fund opesating budget) be
reserved to a. Saving Reserve account. The Reserve account has received direct
appropriations in two fiscal years. Funds were tmmferred from the Account in 1993-94
to alIow the State to restore the June 3on payroll for state, university, and c~mmunity
college employees back to the year of encumbrance. For the 1999-2000 f i d year, the
sum of $200 million has been transferred for the purpose of compIying with the lawsuit
(SmiWShaver cases) settlement: on the intangible Tax Refunds. Chapter 1999-327
(Senate Bill 1043) states that it is the inrent of the General Assembly to restore the Eunds
in 1999-2000.
The 1993 Session of the General Assembly dhckd that the low= of one-fourth of the
year end unreserved credit baIance or 1.5% of the replacement value of General Frmd
facilities be reserved to a R-IRenovation Account by the State temUer. This action
was effective with the year d balance of 1992-193. The 1995 Session of the General
Assembly changed the earmarking to the greater of one-fourth of the year balaaoe or 3%
of the replacement value. The 1996 Session directed that 3% of the replacement d u e or
all of the d i t balance be e m k e d to the Repairknovation Account if the total were
-cient to meet the 3% requirement.
Reginning with the 1992-93 fiscal year, the m g for repa irs an8 renovatiom has
k e n as shown below (in miElions):
Page I3-3
RepsirlRenovations Reserve
Total
Earmarked Univerarity Other Unappropriated
1993-94 $60.0 $33.0 $27.0
% of Total: 55% 45%
1 994-95 $146.3 $57.5 $67.5
% of Total 46% 54%
1995-96 $130.0 $59.8 $70.2
% of Total 46% 54%
1 996-97 $1 74.3@) $94.8 $79.5
% of Total 54.4% 45.6%
1 998-99 $ 1 5Q,O %69,0 $81 .Q
% of Total 45% 54%
(a) Appropriated by 1996 Session for special appropriations.
@) Includes $39.3 million in suppJemcntal appropriations to the $135.0 million
marked though rephment value formdq the per cent of totaz reflects the
inclusion of the supplemental funding.
With certification of the 1996-97 budget, appropiations from the FkpirRenowtion
Reserve account were made directly from b t acwunt thereby not reflected as direct
appropriation as had been the practice in prior years. The practie of showing these funds
as direct appropriations was restored with the 1997-98 budget.
Clean Water Manajpment Tmt Fund
The 1996 Session of the General Assembly established the Clean Water Management
Trust Fund to finance projects to clean up or prevent surface water pollution (G.S. 1 13-
145.3). The funding for this acwunt is 6.5% of the unreserved credit balance or a
minimum of $30 million,
Page 33-4
Condition of the General Fund
The 1999 Session of the General Assembly adopted the 1999-2001 biennial state budget
on June 30, 1999, one day prior to the beginning of the new fiscal year.
The adopted General Fund budget was based upon a projected beginning unreserved
credit balance of $260.4 million. Revenue projections for 1 999-2000 and 2000-2001 did
not reflect any tax law changes although the 1999-2000 sum did include an estimate of
$69 million to be realized from W R gains on asset sale. Also, included was $20 million
of dispropohome share receipts collected during 1998-1999 but held in a restricted
reserve by the State Conmller to be appropriated by the General Assembly. Totd,
availability for 1999-2000 was $13,531.5 million; and, for 2000-2001, it was $13,944.3
million.
Prior to adjournment, the G e n d Assembly enacted several finance bills that have a nd
impact of $4.90 million in gains for 1999-2000 and of $5.82 rniIlion in revenue loss for
2000-2001. After reserving 5 998-9 reversions of $30 million for capital facilities at the
aquariums and $7.0 million for the Warren County PCB Landfill clean-up, and
earmarking funds as required by Budget Reform legislation excepting the Savings
Reserve Account, the actual unreserved credit balance to begin 1999-20W totaled $296.7
million, an increase of $36.3 milIion over the budgeted amount. For 1999-2000, with this
revised credit balance and the revenue gain from tax law changes, a sum of $40.9 milIion
remains unappropriated. For 2000-2001, the sum of $380.4 million remains
unappropriated and will be available to the 2000 Session of the General Assembly to
address the remaining $240 milIion required to fdfill the State's obligation for complying
with the court settlement on the intangible tax refunds; to replenish the Savings R e m e
Account; to continue the commitment for increased salaries for teachers; to fully
implement Smart Start, to address the University of North Carolina capital needs, and, to
meet other needs of state-operated programs.
The 1997 Session of the General Assembly authdmd the State Treamm to invest $61
million in the North Carolina Railrod. The m c e of State Budget was required to
present to the 1999 Session of the General Assembly a plan for the payback of these
funds; however, the planning deadline was extended one year. Further, Pegislation
authorized the use of mud dividends received by the State during 1999-2000 to
several projects. The projects are as follows: f lQ million to upgnde tracks in Eastem
North Carolinn; $6 million to purchase the right-of-way for the Charlotte train station;
and, up to f 3 million for the old Burlington statiodmundho~p ursuant to a plan to be
adopted by the No* Carolina Railroad Company. Dividends received by the State a d
used for the these projects will d u c e the repayment obligation.
Page B-5
Condition of the General Fund (Actual 1998-1999)
Eb#nnfng Credit B 8 l a n ~
Unreserved balance from prim fiscal ymr
Reserved Dispropwlite Share Reczlpts
Sav~ngsR eserve
Clean Water Management Tngt Frnd
RepairdRenavation Reserve
Reserve fur BaikylEmwylPatt~n Dedsb
Reserved Rewnes U n m n a d T ~ l
Authorized
lor
Expendftur*
Revenue
Tax Revenue
Nontax Revem
H~ghwayF und Tmn*
H~ghway Tmt Fund Twnsfer
Oispmponionate Share RE&@
Appmprldom:
Carrrenl ~ c m (Indsude s $321,172 trmdwlo Work Fkd Resmnra) 35,447.111 12,141.MA38 ?2,fn,442.%7
Capltal Irnpcouements-Direct a d RepaimRenuwIion R m 0 145,000.M11E f 92,199,500 337,188,500
Ckan Water Management Trust Fund 0 47,397,819 0 47,397,819
BsileylEmmyIPBttam 18wsuil 0 *00,M)O.OOO 0 4 D O , ~ , O O O
T-I AppropMtione 0 Mm844,*30 12334,9W3%6 12,~2,039,8@6
Budgrt -r E.rrmtldng of Lhw8mwd Ending M hhner
Savlrrgs RamM? 0 0 0 0
RepairslRwwvali#s 0 150.OW.000 (15U,OM),P00) 0
Clean Waler M a n a m Tn& Fund 0 31,0slr.152 (31.0$4,152) 0
Aqwrlums Capltal Resarwpho of 1988196 9)- 0 3 0 , ~ . (3~a.W e.oOO) 0
w m~w n t y~a ndnn{ ~ sOsI 7 988-m ~ ~ ~ n ) o n e j o 7,000.000 (7,000.oao~ o
Tatrl Burlget RMomJOther Eamrklng 0 218,0W,lw pl&U54,l62] 0
E*Q Fund Eiakne# W Z A z e 2 1 2% - 1,mkamI6m
Condition of tha Work Firat Resenre ( A w l 1898-1999)
Page B-6
Con#Non of the Generat Fund and General Fund Remes
1999-Z#O AuthhorI~adb y lW9 SWSlon 2000-2001 Authwlxed by 1999 Session
We*vsa Unmawed Total Reserved Resent- Unreserred Yotat
Authwlzed buthodzed
lor for
E*wndltm ExpenditUra
motnnlng emm esrsm
Y n - d batanca (rompfWfkcaIyc~r
Reasrvbd WsprmdLonas Sham RsesW
Sevlmgs Rewrw
Clean Waler Management Trud Fund
RbpalnlRenwatlo nR-Aqusdurns
Capital Resew (Used 1998-1- Rmnbn
Wamn County tgndflll IUM Of 1 W 9 9 Rambns)
Total Beglnnlng CWR Batan-
Fawsmn
Tax Rsrsnrls
-Revenue
Hbhway Fund Transfer
Highway Trual Fund T m M
Disproparllonatb Stwm Rewlpls
Apfmprwml#:
cum Qxnatkms
CapMl lmpmverrwntr
Clean Water Mmagmml Trust Fund
RepahrrRenwation Resew
BailaylEmrylPatton Lawsuit
mamale ~ a swe ttlement
Cd D ~ A ~ ~ t m m h m h o m R l r s r v s r 2 Aqurrlmm Capital Ruservs (Urn d 1898-t999 Revdm 0 30,000,MW
FP Wamn County Lend11 (he of t M 8 9 Rmardons) 0 ~,OUD,OM
w
I
4
dltlon af the Oonsral Fund and G~neraFl und Reserves
1999-2000 Authodzed by $999 Segslon 2000-2001 Authorized by 1999 *sfon
'Rslwrrpsd m Ulwmsewd Total Rasmnred Resewes Unreserved T6tat
Authwlted Authortrd
fw for
Expendlhm Expendltun
ECONOMY
AND
REVENUES
,ECONOMIC OUTLOOK AND GENERAL FUND REVENUES -
1998-99 EXPERIENCE
For the ~ e n t yhea r in a pow General Fund revenue collections exceeded the budget estimate by
e healthy margin. This mkm to a major ob'jw of the 3991 budget reform package: to use
the conmatwe estimating philosophy in place prior to the 1991 budget crisis. One result is thal
the state" sunencumf>ered General Fund cash balance has risen from a negative $200 million
during 1990-9 1 to $1 .g billion during the peak month 01 j998-99. In addition, the slates rainyday
fund was capped out a! 5522.2 million on June 30, f 998 (5% of prim yeafs owrating budget).
A comparison of achm! General Fund revenues with the budgeted amount for 1996-97 b shown
on Page C-2.
Cdlectlons far the two tax sources most closely related to the economy - withholding and sales
tax payments - cam in slighw above the target The primary reason is that Federal Reserve
monetary palicy has continued to be stable. In fact, om of the great success stories of the 1990's
has been the ability of the Fed to achieve moderate growth with 30w Mation year after year.
The withholding tax swpbs ~e l k t e dhi gher-thanexpected job gtowth, the impeet of tight labor
markets on wage rates, an increase in emptoyee bonuses, and the esshing in of stock opbons.
Sales tax reeipts continued To exr& the increase in consumer dipable inoome, wnfiming a
kealth effecr fKrm the rise in stock and bond prices.
On the caporate front analysts on Wall Sret atxi budget forecasters around he country have
mistentiy underestimated the persistence of profit impmvement from downsizing actMties and
other productivity enhancements. The uptick in corporate net Sm, combinad with declining
interest rates, is a major reason why ttre nation's equity markets have -red in m t yea rs.
A kurth category where collections exoeeded the W e c ~i~s ntw rwlthhdding payments and final
payments under the personal inrx#ne tax. These m-withholding receipts wem $185 million (or
11%) above target. In addiiun, incame tax refunds were $35 million less than expected. These
hvo -non-wage" trends relied UR continued surge in the financial marlcets, the stimulative impad
or federal capital gains tax relief on asset sales, and individual retirement plan distributions.
WROOK FOR 1999-20M BlENNIUM
The economic outlmk suppwt)ng the General Fund revenue fwecast for the ~pcomingtw o years
Is based on a modest economic slowdown and continue low inflation, as shown MI the table on
Page c-3.
Page C- 1
GENERAL FUND REVENUE COLLECTIONS ($MILL.)
Page C-2
ECONOMIC OUnOOK AND GENERAL FUND REVENUES (Continued)
ECDNOMlC lNDlCAfORS (STATE FISCAL YEAR BASIS)
ANNUAL RATES OF CHANGE
1998-99 199940 200041
Actual Projected Projected
US. INDICATORS
Real Ewnomic Growth
Monfamn Employment
Personal Income
Industrial PducZion
CORE Inflation {CPI)'
Corporate Profits (Pre-Tax)
Short-Term Interest Rates (Actual Rate)
Long-Term Interest Rates (Actual Rate)
P m a l Income 6.2% 5.5% 5.8%
Nonfarm Employment 2.8% 22% 2.0%
Unemproymen t Rat@ (Actual Rate) 3.2% 3.2% 3.5%
Avemge Hwdy Earnings (Manufacturing) 3.6% 3.8% 3.8%
Retail Sales 72% 6.5% 6.8%
Hwsing Starts 15.1% -6.0% -2.8%
Auto Safes [Actual Number) 404,486 478,390 590,920
"Regular consumer price index less volatile food and energy seetors.
ECONOMIC OUTLOOK AND GENERAL FUND REVENUES (Continued)
1999-2009 'Forecast Explanation
The projection of Genml Fund revenues for the 1999-00 and 2000-01 fiscal years involved a
four-step proms. First, the economic factors shown on page C-3 were used to forecmst baseline
revenues based an long-term historical relationships. These estimates are shown on page Cd.
Some of the key growth rates are on page C-8.
Next, these numbers were adjusted for any special economic factors. For example, sales tax
receipts in recent years have exceeded the growth in state personal income as consumers have
spent a portion of their stock market profits. For the upcoming h years, the regular sales tax
growth rate was adjusted to a rate that is one percentage point higher than intome growth to
q n k e th e continuat~ono f this %ealth e W .
Atthe same time, mcem wer the historical voMlii of corporate profib and wntinwd problems
in the overseas economies led to a very oonsetvative appmach in prcjecting corporate income tax
receipts.
The thtrd step was to adjust the baseline estimates to take into amount the impact of j995-99
session revenue law changes, the impact of me Bailey wse (fun income tax exemption for most
public sector retirees), and other technical factors affecting revenue flows, Fur example, the
projected rate of decline of tohacoo tax revenues was ralcheted up h-om 1-2s per ywr to 4%,
based on the 1998-99 experience. Tbese adjustments, shown on page C6, are included In the
detailed numbers on the adjoining pages.
Finally. a substantial portion d the large General Fund mvenue surpluses during the &st 4 years
has bstn due to the impact of the RRancial markets on investors. The additional receipts come in
ptimadly through fmased quarterly estimated tax payments by high income irsdwiduals and
'fmal' in- tax payments due Apd 15. For the 1997 tax year if appears mat some of this
impact spilled over into withholding tax payments (higher than expected) and k x refunds ( h e r
than anticipated).
The best indiEator of ofthis trend is the fact that since the 1994-95 fiscal year stack prices (S & P
500 index) have risen at an average annual rate of wer 30%. Vety few market anatysts expect
this type of experience to be duplmted in fk Mure. In fact, even some of the 'bulb* on Wall
Street anticipate stock price gains of 58% per year fw Be next few years.
Another ream for a cautious faemst of heme lax revenues is me continued eancern of the
F W I Reserve about he impact of the surge In stock prices on the econwrry wwWlng through
the 'wealth efkc!". If the markets do not level off, the Fed will raise interest mtes to slow
consumer spending and business investment
interest rate hlkes wwld negatively impact the stock market through a mbinatim of sbwer
1800nmk growth (reduced corpMate profib) and 8 shm in portfot'ioa f mst ocks tc bonds.
For these reasons, the budgeted revenue forecast assumes that stock prices will rise 22.8% for
1999 {most of this has already oocurred) and will fall by 3.9% in 2000 before recwering at a rata
of 5.2% in 2001.
The actual fo-t numbers by mume am shown on page G7.
GENERAL FUND REVENUE FORECAST ($MILL)
TABLE 1: BASELINE FORECAST PRIOR TO TAX LAW CHANGESm
Tax Revenue
Personal Income
Sales & Use
Corporate Inme"
Franchise
Insurance
Alcoholic Beverage
Intangibles Tax
Inheritance
Soft Prink
Privilege Liceme
Tobacco Products
Piped Natural Gas
Gift
Other
Total-Tax Revenue
Nontax Revenue
Investment income $197.3 $222.1 $246.1
Judicial Fees 90,3 94.9 95.7
Disproportionate Share 76.0 100.8 0.0
Other 65.3 68.0 66.1
Insurance Dept. 14.9 14.0 153
Total-Nontax Revenue $443.8 $499.8 $423.2
Total: Tax & Nontax Revenue $10,236.7 $7 1,194.2 $12,203.0
Tflnstgm:
Highway Trust Fund $170.0 $170.0 $1 70.0
Highway Fund 11.1 11.9 12.6
Total-Transfers $181.1 181.9 182.6
TotaCEeneral Fund Revenue $10,417.8 $1 1,376.1 $12,385.6
9,2% 8.9%
'Actual numbers have been adjusted for major processing delays
Vndudes one-time capital gain of $88.0 million for 99-00 (RJ Reynolds Tobacco)
'Adjusted for tax law changes, prooessing delays, etc.
Page C-5
GENERAL FUND REVENUE FQRECAST ($MILL.)
TABLE 2: IMPACT OF 1995-99 REVENUE LAW CHANGES ($MILL.)
Tax Rewenue
Personal Income
Saw & Use
Corporate tnwme
Franchise
Insurance
Alcoholic Beverage
Intangibles Tax
Inheritance
Soft Drink
Privilege License
Tobacco Products
Piped Natural Gas
GiR
Other
Total-Tax Revenue
N o w Revenue
Investment Income
Judicial Fees
Disproportionate Share
Other
Insurance Dept.
Total-Nontax RevenU8
Tota t: Tax & Nontax Revenue
Transfern:
Highway Tmst Fund
Highway Fund
Total-Transfers
TotalGneral Fund Revenue
..
Page C-6
TABLE 3: ACTUAL FORECAST INCLUDING IMPACT OF TAX LAW CHANGES [$MILL.) '
Tax Revenue:
Personal l ncome
Sales & Use
Corpomte l ncome
Franchise
Insurance
Alcoholic Beverage
Intangibles Tax
Inheritance
Soft Drink
Privilege License
Tobacco Pmducls
Gift
Piped Natural Gas
0 ther
Total-Tax Revenue
Nontax Revenue
Snveshnent Income $199.3 $224-1 $248.1 $249.2 $236.2
Judicial fees 90.3 99.1 112.8 121.0 12f.f
Disproportionate 5 hare 76.0 100.8 0.0 85.0 105.0
Other 65.3 70.2 7 1.0 89.6 114.4
Insurance Dept. 19.6 18.7 20.3 40.2 41.6
Total-Nonkax Revenue W!50,5 $512.9 $452.2 $585.0 $824.3
Total: Tax & Nontax Revenue $9.079.1 $10,751.6 $17,544.4 512,550.3 $13,092.3
Tmnsfers:
Highway fms t Fund $7 70.0 $1 70.0 $170.0 $170.0 $170.0
Highway Fund 31.7 7 1.9 12.6 13.4 13-8
TobFTransfera $381 -1 $187 "9 $182.6 $183.4 $1 03.6
TotaCGeneral Fund Revenue $?O,060.2 $10,933.5 $11,727.0 $12,733.7 $13,275.9
Page C-7
BASELINE GROWTH RATES FOR MAJOR REVENUE SOUR-S - GENERAL FUND
WISTORICAZ RATES* BUDGETED
-92-93 -93-94 -94-95 9-5-96 9-6-97 9-7-98 9-8-99 -9940 0-041
*Adjusted for tax law chaages, tax coUection or refund deferrals, and other special one-time faaurs.
**Tax has ken repealed. Budgeted rate applies to remaining 'wck-q" tax tax that1 be levied to use
up federal credit for state death taxes.
* +*Includes tax soufces not h w n in table.
NOTE: The slbwer growth asmhptions for 1999-2001 biennial are due prirnari ty to the modest
slowing of !he economy due to federal merve monetary policy and the expected flattering of st&
and bnd prices.
Page C-8
HIGHWAY FUND FORECAST
The Highway Fund is supported from three primary revenue sources: three-fourths of the motor
fuels tax; license and fee revenues collected by the Division af Motor Vehicles; and interest
earned fmm investment of highway funds by the State Treasurer.
IV 1 W8-99 REVENUE CQLlECTKSFllS
Highway Fund colkfiins Waled $1.1 31 billion in RT 1998-99, a 1,695 increase over FY 1997-98
collections of $1 -1 13 billion, but $15 million (1 -3%) below the certified budget #eve/. Motor fuels
tax collections fell short of the certified budget by $16.4 million (2.1 %) but investment income was
greater than the certified budget level by $2.9 million (26%).
1 g99-2000 FORECAST
Highway Fund revenues are projected to grow by $18.5 million (1.7%) in FY 1999-Q0. Mator
fuels Tax receipts are expected to rise by 2%. Truck licenws, Staggered Vehicle Registration,
and International Registration Plan are expected to remain relatively constant while Driver
License fees are expected to rise by $7 1.1 million, or 17.2%.
HIGHWAY FUND REVENUE
(millions)
Fuels Tax-
Motor Fuels fax
Gasoline Inspection Fee
Highway Use Regisbation Fee
Total Fueb faxes
Licenses, Fees, and Penalties
Staggered Vehicle Registration
Truck Licenses
international Regismon Plan
Drivers Licenses
Other
Total Licenses, Fees, and Penatties
TOTAL HIGHWAY FUND RWENUE
Page C-9
HlGHWAY TRUST FUMP FORECAST
The 1989 Session of the General Assembly established the Highway Trust Fund, whose
revenues are used almost exclusively for highway constmction. this fund was created with new
State revenues in addition to highway taxes and fees tmditiinally deposited into the State
Highway Fund. The primary revenue sources are one-fourth of the motor fuel taxes; a 3% use
tax levied whenever a motor vehicle title is transferred (unless specifically exempt by general
statute); titk fees and various reg~stratin fees collected by the Division of Motor Vehicles;
interest earned from investment of the Tmst Fund cash balance; and an annual transfer from the
Highway Fund equal to the reduction in highway bond debt service relative to the level of debt
service in 1989. (The General Assembly suspended this latter $38 million transfer for FY 1998-
99 and for the 1999-01 biennium.) In addition, the law requires that $170 million be transferred
each year from the Highway Trust Fund to the General Fund.
FY 1998-99 REVENUE COLLECTIONS
Highway Trust Fund revenues for FY 1998-99 totaled $873.8 mHlion, representing a 4.5%
increase wer PI 1997-98 revenues of $835.8 million. Highway use tax rwenues e x d e d the
certified budget by $31.9 rnlllion (7%) and Tmasurefs investments exceeded projections by $7.9
miillon (25.2%) as a result of higher than expected msh balances being available for investment
1899-2000 FORECAST
Highway Trust Fund revenues am expected to increase in M 1999-00 by 0.7% to $880.0 million.
Growth in most revenue sources is expected to be low and investment income Is expected to
decrease.
Ravenueo
Motor Fuels Revenues
Motor Vehrde Use Tax
Title Fees:
Certificates of fdle
Miscellaneous Tltle Fees
Treasureh l nvestments
Total Revenue
Amount Rmqulred to be f ransferred
to the General Fund
Amount Required to be TmnsbrPed
f m th e Highway Fund
(suspended)
BALANCE AVAlUlBLE
HIGHWAY TRUST FUND REVENUE
(Millions)
1998-99 180940
Actual Projected
FEDERAL BLOCK
GRANTS
FEDERAL BLOCK GRANT PROGRAMS
L
HISTORY
In 1981, the Reagan Administration recommended and Congress adopted the Omnibus Budget
Reconcilkn Act which created a number of new "block grants" to be disttibuted to State
governments in Iieu of numerous traditional "mtegoricaP funds. This approach to State aid
reflected the President's philosophy of shifting more kcal decision-making to the States. In
addition, it allowed the Administration to signjticantly cut the federal budget.
In p i o u s years, Congress had appropriated money to the States for smaller, narmw-purpose
programs, such as those for crippled children, migrant health. family planning, and immunization.
These funds were accompanied by numerous "strings" and substantial paperwork requirements.
The new block gnnts consolidated appropriations for many of these programs into hrge, general
purpose grants which had fewer "strings" and allowed mom flexibility in the use of the funds.
BRIEF DESCRIWION OF THE BLOCK GRANTS
SOCIAL SERVICES BLOCK GRANT
The social Services Block Grant is intended ta provide federal funds to help (people achieve or
maintain a greater degree of economic self-support or self-sfidency, to prevent abuse or
explcitatlon of children and adub who are unable to protect their own intemsb, and to prevent
inap~mpriatein stitutional care or to secure appropriate institutional care when other forms of cam
are not appropriate. The primary providers of these services are the one hundred county
departments of social sewlces, and examples of services funded include child and adutt day are
and in-home services for the ekledy.
SUBSTANCE ABUSE PREVENTfON AND TREATMENT BLOCK GRANT
The ADAMHA Reorganhation Act of 1992 (P.L. 102-321) split lhe NmM, Drug, and Mental
Heaith Services Block Grant (ADMBG) creating ha new Substance Abuse Pmentiofi and
Treamnt Bfock Grant The SAPTBG provides federal finandal assistance to slates far the
provision of prevention and treatment d alcohol snd drug abuse.
MENTAL HEALTH SERVICES BLOCK GRANT
The MHBG provides federal financial assltanoe to states fur the provision of eomnRy based
sewices for the mentally ill. Services provided through the use of the block grant must be those
described in the State's Plan In accordance with Federal P . t 102-321. These services indude
oulpatient, day treatment, psychosocial rehabilitation, emergency services, residential servioBs,
&c.
MATERNAL AND CHILD H€ALTH BLOCK GRANT
This block grant funds heatth sewices for mthrs and children to reduce infant mortality and the
incidence of preventable diseases and handicapping conditions among children. It also prwides
for rehabltative services for blind and disabled individuals under the age of 18 and for b a t n ? d
and care of children with devetopnwnta1 disabilities. ,
Page [El
FEDERAL BLOCK GRANT PROGRAMS (Continued)
PREVENTWE HEALTH SERVICES BLOCK GRANT
Thii block grant provides health services to low-in~ame persons in order to reduce the risk of
preventable illness and early death and to improve ths quali of life through better health.
LOW-INCOW€ ENERGY ASSISTANCE BLOCK GRANT
fhe purpose of this block grant Is to pvkk funds to assist low-inoome Fdrnilies wiEh their heating
fuel costs, to provide some emergency assistam and h m we athetiration or energy-related
home repairs.
COMMUNPrY SERVICES BLOCK GRANT
This is a federalfy funded progarn that provides a range d services and activities designed to
eliminate the causes d poverty among Ute elderly, poor, and handicapped.
COIIIIMUMW DEVELOPMENT BLOCK GRANT
This Mock grant pruvides funds to assist lam1 governments with community and m o m i c
dwelopment projects that primarily benefit Iwv and moderate income persons.
CHILD CARE AN5 DEVELOPMENT BLOCK GRANT
In 1996, Congress com1idated this b k k gtant into the MI@ Care end Development Fund Mock
grant North Caml~na mrved its final CCDBG funding on September 50, 1998 and pfans b
obligate the $1.6 million remaining from this award in FY 19W-99.
CHILD CARE AND DEVELOPMENT FUND (CCPF) BLOCK GRANT
The Personal Responsibility and Work Opportunities Reconciliation Ad of 1996 eliminated my
entitlement to child wre subdies and mmolidated all federal child care programs into the CCDF
block grant. The purpose of the CCDF block grant is to improve the affordabllity, avaHability, and
quality of child care for families. Most of the block grant funding must be used to provide child
care subsidies to families receiving public assistance, miking the transition off of public
assistance, or at-risk of becoming dependent on public assistance, In addition, 4% of the total
allocation mud be spent on quality and avaiiability inlfiativea. CCDF quires at! prwiders carlng
br chitdm receiving subsidies to meet minimum health and safety standards.
TEMPORARY ASSISTANCE FOR NEEDY FAMILIES
In August tm, Congm passed and the Clinton Administration enacted the Personal
Resp~nsiMlitya nd Work Opportunities Reconciliation Act of 1996 (PRWORA). Better krmwn as
federal WeBfare Reform, passage uf PRWORA ended Ese of bhe Aid to Families of
Dependent Children (AFDC) entitlement program and replaced it with the Temporary Assis-for
Needy Families (TANF) Block Grant, This action gave states unprecedented fkxibilfly to
create their awn welfare program which emphasize se~-sWiwand work.
- FEDERAL BLOCK GRANT PROGRAM:
HOW,TEIE MONEY WILL BE SPENT IN NORTH CAROLINA.. .... -
i
DEPARTMENT OF COMMERCE
Community Dwelopment Block Grant - 1999 Program Year
DEPARTMENT OF HEALTH AND HUMAN SERVlCES
Plvlslon of Mental Health, Dwelopmwrtal DlsaMlM and Substance A b m Sewfees
Sacral Sewices Block Grant $1 0,764,124
Mental Health Services Block Grant 6,238,341
Substam Abuse PreventEon and Treatment Block Grant 33,865,050
Temporary Assistance for Needy Families Blcck Grant 7,607,280
Dlvhbn of mist1 services
Low lncome Energy Blmk Grant $18,460,000
Social Senrims BtoCk Grnnt 39,499,083
Temporary Assistance for Needy Famiri 267,421,202
Phrbion of Faclllty Sewiw
Social Smioes Block Grant
DMslon of Child Dwelopment
Child Care and Development Block Grant
Social; Services Block Grant
Child Cam and Development Fund BImk Grant
f empwary Aws t a n c ~fo r Needy FmJlii
Divhlon of Youth S e w b
Social Services Block Grant
Page D-3
FEDERAL BLOCK GRANT PROGRAM HOW THE MONEY W l U BE SPENT
IN NORTH CAROLINA (Continued)
Pivision alr Vm8ti~naRt ehabllhthn
Social Services Block Grant
Division of Sewices for the Blind
Social Setvices Block Grant
Oajee of ih Sscmry {Offica of Economic Opportunyr)
Social Services Block Gmnt
Community Services Block Grant
Division of Aglng
Social Services Block Grant
Diiislon of Publlc Heatth
Social Services Block Grant
Temporary Assistance hr Needy Families
Preventive Health Sew ices Block Grant
Maternal and Chikl Heatth Block Grant
CHANGES TO THE MEDICAID PROGRAM
STATE
During its 1999 ReguIar Session, the N.C. General Assembly enacted the following total
requirements for the Medicaid Program: $4.7 billion for FY 1999-00 and $5.1 billion for
FY 2000-01. State funding for the Medicaid Program totals $1.3 bilIion for FY 1999-00
and $1.5 biIIion for FU 2000-0 1.
During its deliberations on the proposed budget, the 1999 General Assembly adopted the
following General Fund reductions: $160 million for FY 1999-00 and $126 million for
FY 2000-0 1. The reductions represent anticipated reductions in the numbers of eligible
Work First clients, lower utilization of services by all recipients, reduced idation to
most service providers, elimination of major policy changes, increased income from the
drug rebate program, transfer of fkds hm the G.S. 143.23 -2 reserve fund and other
miscellaneous reductions.
The 1999 General Assembly also made the following policy changes to the Medicaid
Program and increasd the budget for the program to support these changes:
Expand Transitional Medicaid for former TANF recipients h m 12 to 24
months (General Fund appropriations are $2.1 million for FY 1999-00 and
58.2 miUion for 2000-01 )
Increase physician rats to match Medicare rates (General Fwd
appropriations are $3.6 million for FY 1999-00 and $3.8 million for 200061)
FEDERAL
No significant f e d d changes have waxred m far in 1899, but k g m s has not
completed its work at the time of publication.
DISPROPORTIONATE SHARE m s
Diqqmrtianate S h @SH) Funds art Mdicaid payments made to health care
providers who deliver swvices to large numbers of patients, DSH payments to
health care providers are made in addition to reimbul.sernenzs for services provided to
Medicaid eligible patients. Congress originally authorized the payments as a funding
mechanism to offset the cost of uncompensated care far health cane pvidets,
particularly hospitals, in an effort to improve access to health care for the unhmrd.
Prior to the enactment of The Balmiced Budget Act of 1997, faderal law permitted states
to draw federal funds up to a maximum allotment established by the federal Hcaltb Cam
Financing Agency (HCFA). l%e law allowed states to match federal funds for DSH
pyments with direct appropriations or with funds appropriated to a governmental unit for
the delivery af health care to the uninsured. States were required to obtain approval of
their State Medicaid Plan for drawing DSH payments ikm HCFA.
page D-5
Under the amended federal law (effective October 19971, DSH allocations are set forth in
law on a state-by-state basis. The law provides for gradual redactions in DSH allocations
lo states beginning 1 999 through the year 2002.
North Carolina uses state appropriations to the five state hospitals (LNG Memorial,
Dorothea Dix, Brougbton, Cherry and John Umstead) as the non-federal match with
which the State draws disproportionate share payments. The 1999-2001 biennial state
budget anticipafs % 1 05 million each fiscal year in DSH payments to the State Treasurer*
Section 6(c) of House Bill 168 stipulates that appropriations to the Medicaid program
which become available due to federal Disproportionate Share receipts wiI1 be deposited
as nontax revenues. Any DSH payments in excess of $105 million will resewed by the
State Treasurer far future appropriation.
Page D-6
LEGISLATIVE ACTIONS:
GENERAL FUND
APPROPRLATIONS
General Fund Appropriations
t999-2000,1999 Session
rnrmrrl Qom*mnt:
GanarslAssembty
Owemoh afb
Sraie ~udgetb
Slsle Planntfq
S W l Approphllm
fhe Lhtmant mm
Admhistmtlon - of state CmImAw
AdrnlnshHvs &?4hgs CMm
AdmlnEslraYNS Rcilw R e v k
Cultural Reswrrss
Cultural R~mum&Rommlh8 kd
b u r a m
tcwlwmm-R1CO
Secmtary of stm
Slaie Auditor
Stab Tmesmw4pmtkm
Steta Tmssum-RelksmenWr@qem Barllts
Rmnm
Slale Basrd of ElecuoM
7-1 0-1 Qorsrnrmnt
tkrmn hwwcm
CsntrPl MnMshtion
Mnp DMsbn
CMld ~ l o p m e n t
Hsm-s
@ Bnnd Services
Vocational R s h a b i l ~
wntajham
r Schools for Lhs ml a d Hard d Hearing
Leglslatlve Actions
Contlmdon - Wductlonm Increases Net Total
Racwtlna Nondscurrlno Recurrloa Elon-Recuminn Chnae
General Fund Appropriations
1999-2000,1999 Session
Fadlily Ssrvlcas
SodSl sarvlcss
NC Health Cholm
MadIcaI ALUlstanm
TohI Human Rnourcr
Junia and Publlc Safely:
Comcnon
C@nm Control6 PubUc Safdy
~udidaD~sp arbnem
Jwsnlls Juslica
Justlm
Total Jusb and PuMk Safety
Natunl And Economlc Resources
A#riculllmm
CanmetcalEmnomlc 6 CommunW Dawlopment
Gnnmetcs-Slate Ald
Cornmsrn-SIPS
L a b
NC Houslnp Fhanm Agency
Envlmnmsnt. HeaW and Nalunl Resourns
TohI Natunl and Economk Rnounw
LaglsbUve AcUons
Contlnuatlon ReducUons Incmases Net Total
R*cunlng Non-Recurring Rscurrlng Nan-Recurring Change
mM
Rlndpal and lnlemt
Federal Relmbunement
Total rnM
R a e m and mmhn
'd ConUngenw and Emergency
Slate ltaalth Plan % ~et~raeHaB ~I IB~en ew ~ e s e m
wm Refwm
Mall .Sewice ConsolIdalion Savinps
N SaIa~yIn mases of SPA Employees
suo!lel~da~dyd p unj ledaueg
General Fund Appropriations
2000-2001.1399 Session
~ l 6 o v m m m n t :
GMml h m b f y
OwsmOh MAm
war 6-t b M-t
Wale Plannlng
Sped# Approp~Vum
The tlwtanamt Govern
MmlnlstreUm
of State Cwamllsr
Adh8treUve rndrrps mm
Admhlstratlve Rubs Revierr
Cultuml Resouma
Cuntlral Resmm&Rom& hllnd
hsmm
Rnawanc+RICO
Gemelarj d St*
Stale A u d b
Stpts T m a s u w S n ~
Stale T~svrsr-Retl- Bs&
Rewmue
Stale B o d d EkeUonn
TotalOomrrlQWmnmni
GonUnruth Flmductrnr l ncraa~s Net total
R~wrlng Non-Racurrlng Recurring Noflecurrlng Change
General Fund Appropriations
2000-2001,1999 Session
-- -.-.I---..-.,-..-
Contlnulllm RducUons l ncrewes Net Total
ROcurrlns Hm-Rfwuning Reeunlng Man-Rbeudng Changu
S F h o d a f w t h e U e a f a n d ~ a f ~ 31,721,677 (1 M.7a)
Fadlh Services 10,244,287 0
W e t Senrlcss 181,043.85~ (14,476)
Madlee! Assislanw t ,B53.824.285 (128,34&&.158)
T-1 Humn R~MWSVB 1031,136,256 ~138,961,239)
N.hmlAndEmmmk-e
bgflcutlm and CMlwmer Sswbma
C o ~ w n m l &o Cm rnunlty P a m
Commaros-State Ald
CommeroeSIFs
Labor
NC Houshg Fin- Agmq
Envhwnmd, Hsmlth Bnd Nahrd Resow
Total Flntumt mnd E c m l c
egoog
0-
0 g z a
aoooe
Page E-6
EDUCATION
Overview: 1999 Session Fiscal and Budgeby Actions
Community Colleges
Recommended Budget $549,590,909 $549428,729
-
Legislative Changes
1 Enrollmnt Changes
Provides funds to cover the increased cumunity college
enrol lment. FTE students are al located on the previous year's
actual enrollments.
2 Need-Based Flnancial Aid
This creates the largest community college need-based
financial aid program in North Carolina's history. A
significant portion of the addi tianal curriculum tui tim
receipts will be set aside for need-basad financial aid for
cmunity college students. This anticipates offseting any
tuition increase for thwe students who are not eligible for
the federal Hope and Lifetime Learning tax credi tr. These
funds shall not revert.(HB 168, Sec. 9.4)
3 Management Infarmatian System Reserve
Rorth Carol i M'S Camnuni ty Col lege System does not h e a
Management Information System. This will allow the State
Board of Cemunity Calleges to begin the development of a
cmprthensive MIS. T k s t funds shall be put in a non-reverting
reserve. (HB 168, Stc. 9.9)
4 MuttlCampus funds
To provide additional funding for the operation of mrlti-
CaQpUS cat leger. The funds wi I I b? equal Sy distributed to
those sites.
5 Infomation Tech.TmininglAHS CsrtMmte Funds for Cenfml
Piedmont CC
Non-reeurri rrg funds far Central 'Pi ednont C a n i t y Gel lege to
use for either i t s Regional Informtion Technology Training
program or pi lot Adult High Schoal/Certificatron Initiative.
6 Mosisy Twhnology Center Funds
AMi ti ma l one-tim appropfiati on to support the Hasiary
Technol~gy Center operations.
7 Fayettevllle Tech Botankal Lab Funds .
A nonrecurring grant-in-ard to Fayettevi I l t Tech to develop a
rqi onal botanical laboratory i n partnership with the Cape
Fear Bokmical brden.
6 Reglonal Emergency Sewlces Ttahing Faelflty
Provides a grant-in-aid for Central Carolina W n i t y
College to create a regional emergency services training
faei I ~ t y .
Community Colleges
Special Provisions
1999 Session: HB 168
beparbnent: Community Colleges
Section 9
Title: Employment of Comrnvn ity College FacuttyIStudy
Summary Asks the State 'Board of Community Colleges to hire an independent consultant to study the issue
of the appropriate contract period for full-time faculty and whether the General Assembly should
examine summer term funding.
Section 9.1
Title: Cooperative High School Educ.Prog .Accountability
Summary D i ~ t tshe State Board of Community Colleges to re-examine the coopentive education
programs between the high schools and community colleges to debmine if they are meeting the
State's goals.
Section 9.2
Implementation of Performance Budgeting
Summary Abws community coneges to carry forward up tu 2% of their budgets for non-recurring purposes
if they meet or exceed statewade standards for student performance.
Section 9.3
fitle: Over-Reatized Tuaion and Fee Receipts Transferred to the Equipment Resenre Fund
Summary Mlows the community dlege system to carry forward any over-realized tuition or fee m l p t s in
excess of the amount budgeted and use them in the Equipment Reserve Fund.
Section 9.5
Tiw- Community College F undhg FhIbifity
Summary Boleplate language allowing mrnunlty col!eges to establish their budgets geeordlng to their
local missions. Another subsecbm expresses the intent of the General ABsembly that m m .
colleges not transfer out funds in the fawQ salary portion of tfw formula and requim State
Board approval for transfers m excess of 2%.
Section 9.6
Summary Directs 5100,000 of the Sbk B ~ r Rde serve to help small, rural, kw-~leatthm u n i t y c olleges
with maintenance of @ant funds if they have to serve new and expanding industties. Also
prwides %40,000 frwn this resem tD NClTE to m i t heavy equipment operators. Also
alWes $1 00,000 from Board Resew fw planning a southeastern regional fire training pmgmm
among Cape Fear CC, Brunswick CC and Southeastern CC and $20,800 for other fire training
programs.
Community Colleges
Section 9.7
TiHe: Permit Transfers of Funds to tbe New and Expanding Industry f rainhg Ptogram
Summary Allows the Governor b transfer funds to the New Industry Program for one year if the need arises.
Section 9.8
Adult Education Prograd Review
Summary Dim& the State bard of Community Colleges to shldy the Adult High School program to ensure
that it has made the corresponding r e m s that the General Assembly has drrectad in the public
school system.
Sedion 9.9
Title: Management t nformation System funds
Summary Puts the MIS money into a non-reverting funds b allow it to be paid out to match the mntract
period for ~ e lof the~ systeml .
Section 9.10
Title: Extend Communtty Colege Bond Match Deadline
Summaqf Extsnds by one year the period community wlleges have to match their bond funds. Only
Mayland Community College has failed to c m e up with matching funds.
Sectran 9.71
Tme: Employment Security Commission Training and Employment Account Funds
Summ8ry Allocates money from a new fund to help -unity colleges with equipment and worker training
needs (80%) and to ESC to administer the colledin of the fund (20%),
Summary Clarifies the intent of the General Assembly that funds appropriated for community college capital
projectsand matching ~ s c h ~ h i p s d u r i tnheg 19 98Sesiindonothavetobe matched. a
Seeti 9.13
fine: Community Coftege Resme Funds De Not Revert
Summary Mreck that the resenre fund appropriated during the 1998 Session of the GenW AssmMy to
establish a new cwmnunif)r college sewing ARm and Union counties does not revert.
Community College Construction FlexibilitylStudy
Summary Authorizes the Joint Legislative Education Oversight Committee to study ways to sfmanline the
community wllegs wpital constnretion process.
Community Colleges
Section 9.15
Tifk: No tuition or Fees For Volunteer Fi~fightersa nd EMS Workers
Summary Prohibits the State Board of Community Colleges from imposing a tuition or fee on volunteer
firefighters or volunteer EMS workers for courses required for certification.
Community Colleges
Overvim: 1 999 Session Fisca t and Budgetary Acbons
Public Education
Recorn mended Budget S5,j 43,579,s 17
Legislative Changes
ABC Program
25 ABC Bonus Awards 1999-2000
Provide funds to pay the prqected ABC bonus awards for
FY1999-2000. (HB168, Sec. 8.8)
Excellent Schools Act
26 Increase Teacher Salaries
fmpltment the third year of the new teacher salary schedule
cat led for in the Excellent Schmts kt. $239,870,258 in
recurring funds are located in the Compensation Reserves for
this purpose. (HBt68, %c. 8-13]
27 Teacher Longevity: 3999-2000 Salary Increases
Appropriate funds to teacher longevity increases associated
with the FYt999-M00 salary increases that are a part of the
Excel lent Schools Act
28 Mentor Teuchara
Provide funds for wentor teachers.
Improving Student Success
29 Improving Sfudent AccountabHIty
Appropriates funds to local school systms to improve student
perfomaxe in grades \I-8. Funds are allmated to local
school systems based on the n h r s of students scoring at
Level 1 and 11 on the end-of-grde test. (H8168, Sec.B.17)
30 LtMd English Prof(chmcy
Provide additional funds far students ulm are limited
proficiency in English. iHB168, Sec. 8.10)
31 Low WeaHh Supplemental Funding
Provide additional Low Wealth Supplemental Funding. HB168,
SK. B . 5 )
32 SmaH School System Supplemental funding
Provide additional SMl l School Systen Suppltrmntal
funding.(HBl68,Sec.8.6)
33 Student Information System
funds to continue iaplewntation of a new studcnt infomation
system in tfwl public schools. The new system supports the
State Board of Education's p a l s under the ABC Pqraw and
previous information requirements of tb General Assembly.
M ExplorNd Funding
Provide additional funding for kplorNtt to assist in
programs for public =hoots.
Public Educ9tion
Overview: 1999 Session Fiscal and Budgetary Actions
35 Teacher Cadet Program
Provide funds for the North Carolina Teacher Cadet Program
36 Programs to Assist Local School Systems
Provide funds to the State Board of Education to assist local
school systems in programs to improve student performance.
Included are the TOE Program, Global Curriculum Program, and
the North Carolina Geographic A l l iance.
37 A+ Schools
Provides funds to continue the A+ Schools Program.
38 Textbook Commission Expansion
Funds to support additional members for the State Textbook
Commission. (HB168, Sec.8.30)
39 School Leadership Pilot
Funds to the Sti:? Board of Education for the school
leadership p i l o t project. The four school districts receiving
the funds w i I I participate in the nationwide program of the
Center for Leadership in School Reform.
40 School Breakfast Program
Begin implementing a school breakfast program for al l
kindergarten students. The program would begin i n January of
2WO. HBI 68, Sec. 8.26)
41 Funds for School Needs
Appropriates funds to the Critical School Facility Needs Fund
to assist local school administrative units i n which one or
nore schools were damaged or destroyed.
42 North Carolina Network Funds
Appropriates funds to the State Board of Education for the
North Carolina Network to provide training for school based
management teans, and to improve the management capacity of
local school administrative units.
43 Technology Funds Pilot
Appropriates funds to the State Board of Education for
Highland School of Technology Pilot Project. These funds w i l l
be used to help support an innovative pub1 ic-private
partnership i n school technology through the Gaston County
Educational Foundation Inc.
Various Budget Adjustments
44 Average Annual Salary Adjustment
Annual adjustment i n average salary of certified personnel to
reflect actual experience through December 1998.
45 Additional Adjustments In Average Salary Projections
Reanalysis of the 1998 certified payroll data by the
Department of Public Instruction fwnd that the availability
of more current teacher certification data produced an
addi tional change i n the projected average salary for 1999-
2M)l fiscal biennium.
Public Education pago F B
Overview 1999 Session Fiscal and Budgetary Adiins
46 Revise Average Daily Membership
Revise amounts budgeted for average membership increases to
ref l ect current projeeti ons of average dai l y membership
growth for FV1993-2001.
47 Reduce Children's Trust'Fund Balances
Reduce balance in the Chi tdrenk Trust Fund.
48 Reduce Literary Fund Balance
Reduce the balance in the Literary Fund arrd reappropriate
these funds to the public schools. HB168, Sec. 8.18)
49 Unemployment Fund
Reduce balance in the Unemployment fund for federayly funded
positions. HBIBS, Set. 8.19)
50 Prospective Teacher Scholarship Loan Program
Reduce balance i n the Prospect~ve Teacher Scholarship Loan
Prgram Fund. The reduction ri l l have no impact on the number
of scholarships avai lable i n FY1999-2001 fiscal biennium.
51 Teaching fellows Program
Reduce the balance in the Teaching Fallows Scblarship Loan
Fund. The reduction wi I I have no impact on the number of
scholarships avai table in the 1999-2001 f i scat biennim.
52 Textbaok Fund
Reduce unneeded balance in the text- fund. The reduction
in the balances i n this fund ui I I have no impact on the
availability of textbooks to school students.
53 School But Purchases
Gavemor's recormended deferral of the purchase of 377 school
buses in FV1.999-2W.
54 School Brw Purchases
Additional deferral of the purchase of w b l buses in FYt39S-HIOO.
With t h i s deferral the State would still purchase $26.1
million in buses during the next fiscal year. In FV2000-XW)1
the funding i s restord,
55 Shte Funds for Unemployment
Reduce the State funds appropriated for unwaployent.
. -- -- - - - .- --
Total Legislative Changes $*1l7,347 R $6?,33?,9fi R
$94,930,312 NR $14,337,457 NR
fob\ PmMn Chmge~
Revised Budgat $53s2,6n9676 tS,z7?$18,240
Public Education
Special Provisions
I999 Session: HB 168
Department: Public Education
S e a n 8
Title: Charter !%hoot Advisory ComrnitteeICharter School Evaluation
Summary Allows the State Board of Education to spend up to $50,660 to support a charter school advisory
committee. ~l lowsth e State Board of Education to spend $15 0,000 to conduct an evaluabn of
charter schools.
Section 8.1
fitle: Litigatin Reserve
Summary Authorizes the State Board of Education to expend up to $500,000 to pay the expenses of
pending litigation.
Section 8.2
Title: Exceptional Children
Summary Provides b r the allocation of funds for academically gifted students and children with special
needs for FY 19W2UUO.
Section 8.3
Tile: Alternative SehoolslAt-Risk Students
Summary Authorizes the State Bwrd of Education to spend up to $200.000 to evaluate alternative schwi
programs.
Section 8.4
Tie: UniFom Education Reporting system (UERS)!Student information Management System Funds
(SIMS)
Summa~y Providm that UERS and SIMS funds do not revert.
Section 8.5
me: SuppIemenWl Funding for Low-Wealth Counties
Summary Creates the formula for albting funds to low wealth &toof sptams Ibr (he f 999-2000 scRaol
year.
Section 8.6
me: Small School System Supplemental Funding
Summary Creates the fomwla fw distributing the Sman Schoal System Supplemental Funding for FYI=-
2000.
Public Education
Tile: Funds for National Board for Professional Teaching Standards
Summary Authorizes the payment uf the participation fee for teachers seeking certification by the National
Board for Prof@ssrmaTl eaching Standards.
Section 8.8
We: Funds to Implement the ABC's of Public Education Program
Summary PravMes funds to the State Board of Education for tfw ABC Program for FT1999-2000.
Scion 8.9
Title: Su bstitue Teachers
Summay Provides for reports b local school boards on teacher absences. Where the average is higher
than the state average the local boarrl must develop a plan for reducing tbs systems average.
Title: Limited English Pmficiency
Summary Creates the allocation formula to distribute funds to school systems for studem with limM
proficiency in English.
Section 8.1 1
Tie: Drivers Education Funds Do Not RmrVTeacher Recruitment
Summary Prwides that drivefs educafian funds may be used to pay for driving eligibility certificates.
Pmvides that the State Board of Education may use up to $200,000 ta aid in teacher rec~itment
efforts.
Section 8.12
f*: Teaching Fellows Administration Costs
Summary Prwides that the Public School Fmm may use up to 9150,000 p~ year from the program fund
balance to administer the Teaching Fellows Program.
Teacher Salav Schedules
Summary Establishes the teacher salary schedule Ibr NlQ99-2000.T his schedule is the third ymr of the
Excellent Schools Act
m n 8.1 4
School-Based Administrator Salaries
Summsry Provides the FYI M..20W. salary schadule for prindpals and assistant prindpls.
Seckn 8.15
me: SchA Centml Offica Salaries
Summary Pmvides salary increases for FYf999-2000 te central office ahiniSbtOfS.
Public Education
Section 8.16
Title: Nonwrtified Personnel Salary Fundsrreacher Assistant Salary Funds
Summary Provides salary increases for FYI 999-2000 far all noncertifed personnel.
Section 8.17
Title: Student Aocountablty Standards
Summary Provides legislative guidance to the State Board of Edu&ion on the allocation of funds for
improving Student Amuntabilrty Standards. The funds will be allocated based on the number of
students in grades 3-8 who scow at Level I or Level two on endsf-grade tests. Encourages
school systems to use federal funds to assist these students, and establishes reporting
requirements for the State Board of Education on implementation of this section.
Section 8. 'I8
Title: Appropriation of Funds From State Literary Fund
Summarj Appropriates funds from I!%S tate Literaiy Fond for aid to I c z l school administrative units.
Section 8.19
Tide: transfer fmm Unemployment Resew8 Fund
Summary Transfers funds from the Unemplayment Reserve Fund to State Aid to Leal School
Administrative Unrts.
Section 8.20
1.e: High School Exit Exam
Summary Allows the Stale Board of €ducatin to use up to $2,#0,OW in FY1999-2000 to develop 8 high
schwl emt exam. Requirss the board to report to the Joint Education Oversight Cornmiltee prior
to the expendhum of the funds.
Sactian 8.21
7316: Central M c e Administrator Salary Study
Summary Requires the Joint Legtslative Education Oremight CumrdtW ta study the salaries of central
off!# administrators.
Section 0.22
I*: Mentor 'Program Study
Summary Requi~tsh e State Board of Edmtion to study the mmtor program for tea~herws ith initial
certhtion.
Seetion 8.23
Need for School NursdSUy
Summary Requires that tha Joint Education OverslgM Comrnlttee study me nsed for addiiml nurses for
the public schools. If additional nurses are needed the Committee shall forward the results to
public or private entities that deal with h ~ l t cha re issues.
Public Education
Section 8.24
file: Stu* School Transportation for Children With Special Needs
Summary Requires the State Board of Education to study the issue of transportation of c h i l d ~ nw ith special
needs. Allows the State Board to spend up to $55,0000 in school transportation funds for the study.
Section 8.25
Title' Strengthen Alternative SchoolslAlternative Learning
Summary Requires low?b oards of education ta establish at &st o w a bmati~rele arning program,
effective July 1,2MM. The State Board of Education may allow waivers fmm this requirement
Alternative SchmlsJAlternative Learning Programs. Requires that these funds be spent only on at-risk
students. Requires the State Board of Education to develop addtbonar financial remng
methods b r Alternative schoolslat-risk students,
Section 8.26
Tile: Expand Schwf Breakfast Program
Summary Provides funds to expand he school breakfast program to all students beginning in kindergeMn
January 7,2000.
Section 8.27
Title: Willie MI FundsBhte Aid to Local School AdminMwe Units
Summary Clarifies the status of funds appropriated to the State Board of Eduwtion for former Wflie M.
Class mmbrs.
Seetion 8.28
Tfih: Charter SchooVADM Reduction
Summary Provides assistance to county school s y s m below 3,000 that decnaged enrollment by more
than 4% due ta enrolment shifts bo charter schools. The State Board of Education is requid Pc
study the impact of charter schools on s c h l systems and repoFt to the 2000 session of the
Genera t AssernMy.
Section 8.30
Tide: Textbook Commission Memkrship Expansion
Summary Adds additional members to the State Textbook Commission and revises procedwm refatbe fo
the adoption of textbooks.
Section 8.31
Tm: Differentiated Diptom
Summary The Joint Legislative E d m nO versight Commommamy hs tudy the issue Df MemnWed high
scbod diplomas. The Stale Board of Education shall report ta the Joint Legislative Education
Oversight Committee prior to adoplng a diimtiated diploma plan.
Public Education
Section 8.32
Title: Teacher Assistant Salary Study
Summary Requires the Joint Legislative Education Oversight to review previous salary ststudies on
establishing a teacher assistant salary schedule. Commit& shall report a 2000 or 2001
Section 8.33
Tdk: Study the Relationship Between School Sze and Student Behavior and Performance
Summary Requires the State Board of Eduwtion to study the relationship between schobl size and student
performance and behavior. Board must report to the Education Oversight Committee by April
2000.
Section 8.34
Cooperation in Education Information Technology
Summary Requires the Education Cabinet to prepare a pint report on collaboration on information
technology beween the !he educational systems.
SeMon 8.36
Titla: Estabhsh a Pilot Program to Test and Evaluate a Revised School hrmtabiliq Motlet for the
ABC's Plan
Summary Allows the: State Board of Education to establish up to fwe pilots to evaluate the use of
disaggregated data as a part of the ABC Program. The pilots will be implemented no later ban
the 2000.0 1 school year. Reposts to Education Oversight prior ta impEemefitath.
Publc Education
Overview: 1999 Session Fiscal and Budgetary Actions
UNC System -.,--.- -
, GENERALFUND
- - - - - - - - -- - - - - - - - p z 5 q piq
Recommended Budget $1,589402,360 $1,595887 ,a6
Legislative Changes
A Various Campuses
56 Governor's Across-the-8oatd Redudon ($7,233,554) R ($?,233,5M) R
Reduces General Fund support by 0.5% (except for f t nancial
aid program) on a pro raLa basis.
57 Reserves for New Facilities $362,342 R
Reduction in reserves for new bui ldings are adjusted to ($1,B41,288) HR
account for de l ays in octrrpamy,
58 Equipment
Ad j ust i nc reases i n equ i pment budgets ($1 ,~O,ooO) NR
0. UNC Hospitals
59 UNC Hospitals Support (52,544,383) a ($2,544,383) R
Eliminate first year's propased increase in s q p r t
C. East Camlina University
Increase budgeted receipts f m Hedieare Medical Education
reimbursewnt for one year: transfer $2 m i l l i o n frm trust
fund balance for operations for one year.
Rece i pts $3.000.000
kneral Fund (S3.OM3,MX))
(HB 168, %. 19.7)
D. RMed Eduamd Programs
81 Scholarship fund Balances
Reduce appropriations for one year to spend d m acewlatecl '
($3,000,W1Q)
belances ~n scholarship t r u s t funds for Nurse Scholars.
Princvpl Fel lows. Nurse Educat~m Scholarship Lams, Social
Work Education Loan Fund IHB 168, 5ec. 10.6)
62 Aid to Private Medkal Schools ($455,090) R ($455,000)
El i m i~ t preopo sed increase to budget for aetml experience
ovsr past three years
63 Ald to Students Attendhq Private Calm $8,022,850 SB,M2,850 R
Increases Legislative Tuition Grant for all fulltine students
f ram $1 ,600 to $1 ,750. l ncreases ned-based scholarship
funding f rtrm $400 to $1,050 per ful ltime equivalent student
(IFTE). Total Increase i s $300 per student. (HB 168, See. 10)
UNC System
Overview: 1999 Session Fiscal and Budgetary Actions
64 Aid to Private Colleges: Students with Learning DisabilMes
Assi sbme to Loui sburg Col l ege far development of a program
to provide postsecondary educational opportunities and
learning s k i l l s to students with learning difficulties.
E. Schedule af Prianties
Fund projected on-campus enrollment for 7999-2000, an
increase of approximately 1,494 Full-time equivalent (FTE)
students over the 98-99 budgeted FTE.
68 Enrollment Increases: Distanm Education
Funds 70% af Board's request for expansion of off-campus
degree programs for 1999-M00
67 UNC Focused Enrotlmnt Growtfi
Funds targeted at implemnting the Board's plan far
enrollment growth, focusing resources on campuses with
underuti l i zed capaci ty. Funds vi I I be used far assessment of
needs, better operating efficiencies through economies of
scale, physical facilities nuanagemnt, faculty improvement.
and development capacity. (HB 168, Sec. 10.8)
66 New Degree Programs
Funds to support newly authorized degree program at six
campuses (East Carol ina, El izabeth Ci ty State, HI: A & T
State. NC State, UNC-Charlotte, Winston-Salem Stake) IHB 168,
Sec. 10.761
69 Transition of East Carolina to Doctoral II Status
Funding for second phase of change in classification af East
Carol i na Universi ty to a Dactora I .I I mi versi t y .
70 Finandal Ald
Additional need-based financial assistance for in-state
students
7f Improve College Golng Rats
Funding for PATHWAYS ini t iat ive to increase thc mr ~ b ro f
North Carolina students attending eol lege
72 Information Technology
Fundi ng for software, hardwarn, and oprati ng support
Funds for rapid targeting of urgent issues and problems on
cempuses, enabling Itk University ta explrrre new initiatives.
(Ha l a , Sec. ?0.8(b))
74 Rewarding Excellence In Teaching
Fuds for awarding additional satay increases to a portian
of teaching farul ty judged as exec l lent teachers. (HB 168,
Sac. 10.3)
75 Graduate Student Tu'ltlon Remission
Provide funds for graduate tui tim remission and resident
gredwte tuition awrds on capuses not classified as
Research I universi t i t s . (HB 168, Sac. 10.9)
UNC System
Overview: 1999 Session Fiscal and Budgetary Actions
76 Service to Public Schools: A. Resene
Expansion furrds for UMC Center for School Leadership far K-16
Hatching Incentive Grants, Model Teackr Consortium, and High
Performance Lig h t h s e S c bl s .
77 Service to Public Schools: B. International Educator
Exchange for K-12
Fund1 ng t o provide program of international exchange for
educators
78 Service to Pubtk Schools: C. Reading Together
Addi tional funding for etemebentary tutorial pragretm in reading
at UHC-Greensboro.
79 Publlc Sewice: Aging
Expansion budget support for the institute on Aging ta expand
outreach services to l ma l service provi derr
80 Public Senim: Hispanic: Initiative
Funds to assist service providers adjust to changing
&qraph~cs and dwads caused by Hi spanic imigrat ion
81 Public Service: Agricultural Matching Funds
Funding for NC Agricuftural and Technical State University to
match federal funding for research and extension programs
82 Public Service: Agrieultunl Research-Tufi Grass
Funds to continw research m turf grass by UC State
University .
83 Public Service: Manufaduring Extension Partnmhip
Provide matching funds for engineering assistance to sml l
WufacLurers through HC State Induskria! Extension Servict
84 Public Sswice: HC Atboreturn
Expanded operating funds for the Arhreturn to provide
services to an increasing number of visitors and to ~ i n t a i n
recent l y deve loped areas.
85 Publle Service: International Outwmch4mpratlw Programs
Hatching funds for cwpesative programs in science and
technology betmen MC and Israel.
86 PuMc 3emlo8: B~ombd~VBioteeh~,10Rgeyse arch Imdtub
Provides funds for equipnent and program operations,
including research staff, for research and training in
cadi ovaseu l ar di stases , drug abuse. and envi r m n t a l
toxicology, IHB 168. kc. 10.18)
87 Tuition increase
Tfie bard of Govemrs has approved a tuition increase of.
4.9% for NC undergraduates, with similar dollar increases for
non-residents. Grduate tuition w i I I increase from 6.9% to
8.4% for in-state graduates.
88 Realbcatlan of Funds for Priorities
For the f i rst year, the 16 campuses must resf locate
$1 ,=,000 of previously requi red reversims to initiatives
funded in the expansion priorities
UNC System
Overview: 1999 Session fiscal and Budgetary Actions
F. Other Items
89 Reserve for K-12 Initiative
Funding for "World Vlew" program and "K-12 International
Outreach" prqram at UNC-Chapel H i l l
90 Teacher Academy
Additional funds for staff development activities of t k
~cademy
97 PT-CAM
Om- t i ~ eo perating support for the P i e h t Triad Center for
Applied Manufackuring operated by MC A & T State as it
approaches self-sufficiency frm receipts.
92 Leadership NC
funding to non-profit leadership training prqram.
93 Carbon Diaxlds Dyeing Project
Fund5 to suppart purchase of prototype cw~~lercli ate xt i l e
dyeing equipment to test new process developed at NC State.
94 Allow Research Campusas to Retain Overhead Receipts
Funds to replace 5% of overhead receipts currently
transferred by Research I campuses to UNC General
Administration for operations. (HB 168, See. 10.13)
95 Public Service: Outreach to the Public Schools
Learn NC: Funds to continue technology initiative at UNC-Chap
I Hi I I
96 Center for Akohd Studies
Provides adaitional funding for Center's endowrrent.
97 Diabetes Funding
Provide additional fundirrg for the diaktes prqraas of the
UNC-CH ($2OO.M30) and East Carolina ($IW,MME Schools of
Hedici m.
98 Endowed Chair
Funding for state match to create an endowed chair at UNC-CH
School of Wedicine for the study a5 anorexia and krl imia, (W
168. See. 10.23)
99 Program on Southern Polltiat, Medfat* and Public Life
Fundi nq to support program at UNC-CH.
100 lnatltute of Medicine
Operating support for this research organi sation l m e d at
YNC-Chstpel HI I(.
qO1 Agrlcuhral Programs: Chrlslbnas Trss Rasead
Funds to support research in Christmas tree genetics at H. C.
State Universi t v
Total Legislative Changes
Total Pasttion Changes
R e r i d Budget
UNC System
Special Provisions
1999 Session: HB 168
Oeparlment: UNC System
Section 70
We: AEd to Students Attentii Private Colleges Procedure
Surnmafy Sets amount in student aid programs at $1.050 per fulltime equivalent student Por nwd-based
financial and $1,750 for Legislative Tuition Grants for fulltime undergraduates from NC
Section 10.1
Title: Aid to Private CoillsgeskegisZative Tuition Grant Limitations
Summary Standad language regarding nonduplication of pmgmms at ~ffcampuss ites and establishing
eligibility of military personnel.
Section 10.2
Tte: Wake Forest and Duke Medical Schools AssistancdFunding Fmula
Summary Standard language selting amounts far each school based on number of North Carolina stdents
enrolled.
Section 10.3
Tile: Rewarding Teaching Excellence Program Funds
Summary States that UNC 8oard of Governors sets guidelines for extra salary m e ) r for sxceMent
teaching; prohibits use for any purpose other than salary inoreases and relatd b8nefits.
Secbon 10.6
r~ Scllalarship Fund Balances
Summary Impkments base reductim to spend accumulabd fund Mances fw schdarships.
section 10.7
Title: ~ a sCta mIina ~niversityM WF ~ d h o o ~
Summary lrnplemenb oe-year base reduction by transfenkg funds from a s-I funds code Zo opmting
budget
Sectim 10.8
UMC Enrollment Planning
Summaw Allowtes $10 million among ampuses e m d to grow by 20% wer next 5 years b help
accommodate increasing enrollment Pi- dundig for ecoplomies of scale, faculiy improvemmt
and stability, fund ntsing capacity, physical facilities management, and assssmnt and growth
planning. D mus e of $2 millron for 1999-2000 fnun Board reserve to assess needs at these
campuses.
Section 10.9
Title: Graduate Tuition Remission
Summary Directs that $3.5 million be allocated b graduate programs at campuses not classified as
Research I institutions.
Section 10.10
Title: UNC-Wilmington Retain Land Sale Proceeds
Summary Allows UNC-W to retain and use funds from sale of old marine science facility property to
enhance new marine science facility. Prow* was originally donated to UNC-W.
Section 10.11
IXe: Explanation of Federal Tax Credits Available for Educational Purposes
Summary Requires UNC campuses and mmunitf alleges to prwde brief and clear explanations of
fedeml tax credits available for college tuition and fees when they notify families of tuitiin and
fees paid.
Section 10.72
Title: North Carolina Progress Board
Summary Reestablishes and adds members to NC 'Progress Board, which is moved to NC State Unimrsity
for admin~strativep urpems. Adds to duties.
Albm transfer 01 unspent funds for t 998-99 from Department of Commerce ta NC State b
mplemnt the legislation.
Section 10.13
UNC Overhead Receipts
Summary States that UNC campuses shall retain 100% of wet-head receipts on the ampus generating the
rtmipts.
Title: UNC Gmml Administration FlexlbiJky
Summary Gives UNC General Adminismtion bxibility comparable to specid responsiblllty constituent
institutions in transfer of funds, establishing and abolishing positrons, and wry forward of
unspent balances.
Section 10.T6
UNC New Degree Program Funds
Summary Provides guidance to UNC Board of Governors an which campuses' pqmms were # m M
in allocating funding fw this purpose.
Section 10.17
Title: Marfin Luther King Race Rda!ions R M CeWe rlStudy Slta Loation
Summary Directs UNC bard of Goverm to wnduet site study for this Center and b repMt
mmmendations to G e m l Assembly by 20013 Sessbn.
UNC System
Section 10.18
Title: NCCUtBiotechnolqy' Research Institute Funds
Surnmaty Allocates $9 .SOO,M)O in 1999-2000 and $350,000 in 2000-2001 to NC Central for equipping and
research operations of new research institute.
Section 10.2Q
Faculty Salary Study
Summary Directs UNC Board of Governors to; study salaries and cornpendon for UNG faculty in
comparison to peer institutions. Board is to make recommendations, including funding options, to
General Assembly by December 1,1999.
Section 70.21
Study Prepaid Tuition Plans and College Savings Plans
Summary Directs UNC Board of Governors to study hcrw to make NC college savings program mom
attractive and to make recommendations to Joint Legdative Education Ovensight Committ@e.
Section 10.22
Tide: UNC Carrmmrd
Summary Allows UNC General Administration Zo carry forwad %400.000 at the end of the current fiscal year
to assist UNGPembroke and NC A&T State in umrading chancellors' residences.
Section 10.23
UNC Anorexialsulimia Endowed Chair
Summary Directs altocation af $400,040 in appropriated fuw for this pwpme. Requires $200,000 in
private matching funds.
Summary Dim that $20 million in extra repair and renovations funding is to go to campuses (I) expected
to grow by 20% wer next 5 years and (ii) with facility condmtion and qualily indices $elow UNC
system average. OneJlalf of the funds are to bs distributed based on dollar rims, and o~PM%
based on relatlwe quality ratings.
T i : CINC-Charlotte Capital Funds Reafloated
Summary Allows UNC-Charlotte to urn $2.5 million appropriated for partial funding of one hci1'i to begin
advanad planning fw another facility.
SBction 29.6A
Ti: Kekgg Cmlr Funds Do Not Revert
$umnwry SpeciM that prevmus capital funds shall rmt r%wlrt but remain available f# cmstrucbion of this
ma
UNC System
Section 29.6B
fitle: Polymers Center of Excellence Funds
Summary Transfen balance of funds appropriated to UNC-Charfotte for a research facitity on polymers to a
non-profit organization for facilities.
UNC System
HUMlAN RESOURCES
Overview: 1999 Session Fiscal and Budgetary Actions
Health and Human Services -
GENERAL FUND
Recommended Budget 52,871,957A49 $3,038,t35.255
Legislative Changes
7 -00) OWmz 07 the Secretary
1 Eliminate Rural Heakh Reserve ($380,370) i~ ($380,370) R
Eliminates reserve in the Rural Health Section which i s no
longer needed due to increased federal receipts.
2 Etlminate Vacant Posifiom (452,798) R ($52,798) R
E I iminateg 2.05 posi tims: Fi lm Library Supervisor,
I nfomati on Ptocessi ng Assistant I I . and Cornput i ng Consul tmt -2.45 -2.05
I.
3 Reduce Nlental Health Medicaid Match Resenre ( S ~ , o o O ) R I%fwW R
Reduces State appropriations to bring the budget into line
uithrevisedprojcctions. .
4 Reduce 'Funding to Wee of Eeonomk Opportunity ($200,000) R ($200,000) R
Redvees funding to the Office of Econanic Opparkuni t y due
increased federal receipts.
( 2.00) Division of Medical Assistance
5 Incmatse Drug Rebate Receipts ($12,608,398) R ($18,487,741) R
Increases receipts frm the Drtrg Rebate Progrm due to k k
increased expenditures for prescription drugs.
Redwes appropri at i ans tc ref let tht msk current
projections for the Hcdicaid Program.
7 Reduce InClaWon for Must Sswkas by 20% ($3,895,412) R ($4,251,124) R
Reduces inflationary increases far nost services by 2Eg.
8 Efirninate lntmstiy Inemsea ($24, I 60,718) R (S26,058,4W) R
Eliminates all policy changts which would increase the
continuation budget .
9 AdjW Carollna A l b r m t h ($2,500,00Q) R ~S2,500,000) R
Reduces S t a t funding for the Csrolina hltsmatives prqrm
due to s change in the cast-shari ng fornula.
HeaHh and Human Setvices
Overview: 1999 Session Fiscal and Budgetary Actions
I0 Reduce Adm tn istrative Overhead
Iteduces expenditures for printing and postage due te lower
ut i I iration by Work First eligibles.
11 Transfer R e m e Funds
Transfers funds from the G.5. 143-23.2 reserve to support
current services and to reduce appropriations.
12 Reduce Inflation for HospMlslNumSng Homes
Reduces i nf l ati onary increases for hospi tal s and mrsi ng
homes by 2M.
13 Lower 'LltIlization for NC Health Choice
Reduces expenditures because utilization of the NC Health
Choice Program wi I I be lower than the initial projections for
1 9 9 9 - m .
14 Lower Utilization by Work First Eligibles
Reduces expenditures because utilization by Wrk First
recipients i s projected to $e lower.
{ 3. W) Division of Social Services
t 5 Adjust StateKomty Special Ass38tance
Reduces fundi ng to ref lect an Cktaber 1 . 1999, start date for
rate increase.
16 Reduce Work First Reserve
Reduces funds in the Work First Reserve.
17 Eliminate Vacant Pasitlorn
Eliminates 3.0 CcRlputer Consultant I I and JV positiwts.
18 Incmase Revenues
Decreases appropriations in anticipation of immased
revenues for prier year eamd revenues 'based on actual
experi enee .
19 Reduce Work F h t Automation Funde
Reduces State funds for various a~tonratim projects.
( 4-00] Di of Services far DeaHand of Hearing
20 Eliminate Vacant PosHiom
Eliminates five positims: Adminjskl-etivc Officer t l ,
Guidance Cuwnselw, Parent Trainer, Staff kvflopmnt
Specialist !I. and Deaf-Blind Program Consultant.
Health and Human Services meax
Ovwview: 1999 Session Fiscal and Budgetary Actions
( 5.00) Division of Sewices for the Blind
21 Eliminate Vacant Positions
Eliminates an Assistant Principal and a Processing Assistant
I I positim.
( 6.00) Division of Mental Hea It h
22 Reduce Thomas S. Class Funds
Reduces funds for the formerly cwrt-mandated Thomas 5.
Program, which was dissolved i n January 1998. Mai ntai ns
funding for adul ts who were members of the class at the time
the federal court dissolved the class (HB 168, Sec. 11.40).
23 Reduce State Funds to DMH SchoofslFacilltfes
Reduces State appropriations for Wright and Whi taker Schools,
as ml l as the residentiai treatment prqrarns for violent a d
asswl tive chi ldren ( located in W i lson and Butner) , in
anticipation of Medicaid revenues.
24 Elimbate Waiting List Management Funds
Eliminates funds appropriated for FY 1998-99 for nonrecurring
purposes, These funds were originally appropriated frm the
Work First Reserve for o n e - t ~ e i t a s .
25 increase Patient Revenuw
Reduces State appropri at ti ms in antiti pati on of patient
rerenws at the rari ous mknta l h a l t h faci l I t i e s .
26 Eliminate Vacant Positions
Eliminates 2.0 Cmwniky E n p l o p m t Speeislists 1 a I I , I .O
F d S ervice Assistant I, and l .D Mousekeeping Supervisor / I
positions.
27 Eliminate Area Program CaplEel Resasswes
Eliminates funds appropriated i n 1994 for capital nteds for
area prqrams.
( 7.00) DMsian of Health !Services
28 ElImlnatm Vacant Pooitlons
Eliminates fwr positions: Physician I l l-A, Pmesring hit
Supervisor V, Processing Assistant [If, wrd Office Assistant
I l l .
21E Reduce Tubemlosb Pqmm Phamraceutleat Budgut
Reduces frrberculosi s Progrm pharmaceutical budget to reflect
progrw med.
30 Reduce AIDS Drug dssktartc@P rugram Funding
Reduces AIDS D r q Assistance Program (HIV Htdications
Program) funding due to increased federal receipts IHB 168,
sec. 11.55).
Health and Human Services
Overview: 1999 Session Figcat and Budgetary Actions
8.01)) Diision of Facility Services
31 Reduce Fiw Pm?ection Lorn Fund
E l i mi nates u n c m t ted funding appropriated for the Fi re
Protect ion Loan Fund which is managed by the NC Housing
Finance Agency (HB 168, Sec. 1 1 . 1 7 ) .
9,001 Division of Mental ti earn
32 Union House
Provides a grant-in-aid to cvnstruct a psychosmial treatment
fasility for seriously and persistently mentally r l l
individuals.
33 Camp Royal!
Provides a grant-in-aid to the Autism Society of North
Carolina to be used to complete C a q Rqal I, a camp for
autistic chi ldren and adults.
34 Fint Step F a m
Prw~ d e sa grant-in-aid t o the Blue Ridge Area Hentat Health
Center for allocation to the First Step Farm of Western North
Carolina. inc., to increase contracted bed utilization.
35 Area Mental Health Program Merger
Provides funds to colnpltte the merger of the Cleveland Cwnty
and Gaston-Lincoln Area Authorities,
36 Autism Society Funds of NC
Provides funds to help strppsrt programs for autistic chi ldren
d adults: SW,DOO for resident,isl services, $lSO,OW to
expand advocacy awl $270,MX) to provide weekend camping.
37 Wolent and Assaultlve Chfldmn
Provides funds for the formctly courtdated Willie M.
Progran t o continue services for children identified as elms
mmbers at the time the federal court dissolved the class in
January 1998 (HB 168, Sec. 11.40).
58 TEACCH
Provides funds to W-CH, Division of T f A I X H Administration
and Research, to met the expanding needs of pcoptc with
autism. The funds shall bc used as follom: $434,693 for
the Gastonia Center, $236,345 for the Raleigh SatelSite
Center, $199,472 for the Camlina Living and Learning Center
Vocational Expsion, and $181.190 for administration and
research. These funds shall not be used by UNC-CH far
adai ni strati ve costs.
Heatth and Human Sewices
Overview: 1999 Session Fiscal and Budgetary Actions
39 Cornmunlty Mental Health Programs
Provides expansion funds for community mental health programs
to address the needs of i ndi vl dual s wai t i ng for mental
health, developmental disabilities, and substance abuse
semi ces.
40 Early Intenention Sewlees
Prwvi des f undi ng to develop an i ntegrated c l i ent &tabase and
to establish a pi lot site for a reg~onal transdisciplinary
team of exprts to serve chi Idren ages birth through f i r e
years with low incidence disabilities, such as visual or
hearing impairment or autism (WE 168, Sec. 11.42).
41 ACH Rmldent Assessment Sewices
Provides funding for professional mental health assessments
and fol low-up treatnent services for residents f n adult care
h-s w b have been i dent i f ied as p s i ng a risk to ctkr
r e s ~ b n t sd u n g the ini t i a l assessment. Ef fect ive January
1, 2090.
42 DeafirNlentally ill Services
Provides funds t o egprmd services to individuals who are deaf
and b v t nrental illness. Services include specialized mental
health treatment and residential suppurt.
43 Mental Health Hwdng
Provides funds for residential services for the ntnkally i l l ,
including furtds for clients who have a mental illness and are
deaf.
44 &ma Mental Health Board Tmlining
Provides funds far training for local area mental health
authorities.
45 Neumbehavjoral Treatment Unit
Provides funds to establish a 12-bed unit at the Black
Mountain Center for andiwidwlr with t r a m t i c brain injury
and w b require behwioral health services.
46 Human Swvkes Grawts4m-Aid
Prwides a reserve for grants-in-aid to pub! ic and mnprofi k W,a>o,oml HR
h- services oqmi tations for progrms that pravide
strviees to older adults, aduits with disabilities, at-risk
chi Idren. d youth and fat lies (HB 168, Stc. 11.6).
47 Pmmiption Drug Program for the Elderly
Prwidcs stark-up funding to tstabl ish a program ta assist
e tder l y persons with the purchase of outpatient prescription
drugs IHB 168. Sec. 11.1).
Health and Human Senribs
Overview: 1999 Session Fiscal and Budgetary Actions FY 99-2000 FY 2000-01
48 NClbrasl Project
Provides funds for the hlC/lsrael Project.
49 ABCs Plan in DHHS Schoob $400,000 R $400,000 a
Provides funding for professional development and for
increasing the pay grades of cottage and residential staff
positions.
(1 1.00) Division of Child Development
50 T.E.A.C.H. Program
Provides f undi ng to. expand the Teacher Education and
Cmpensat~on Helps (T.E.A.C.H.) Progrm.
51 Tduchlng the Lives of Children Progtam
Provides funding for the Touching khe Lives of Children
Program.
52 Smart Start Sewices
Provides f undi ng to expand di rect services statewide {HB 1 68.
Sec. 11.481.
53 Smart Start Evaluation and Collaboration
Provi des addi ti ona l f undi ng for program eva luat ion to
accamdate the tncreased need for data collection and
reposti ng resu l ti ng from statewi de expansion. A I so provides
funding for county col laboration for the Years 3 through 5
local partnerships IHB I#. Sec, 11 -48).
(12.00) Division of Vocational Rehabllitatiwl
54 Independent Living (11) RehaMlhtlon Program
Provides funding to alleviate the backlog of client needs st
prqram offices statewide. The Oepartrnent may estabiish up
to pine positions in the areas of rehabilitation engineering.
casework technicians. and central office suppart. Prwidts
funding for tuo I L Cowrselor/Care Coordinatcr p o s i t i w ~ to
work with individuals with brain injuries and their
fmi l ies. The Ikpartnent my use up to $la ,OW to contract
with the MC State University's Center for Universal &sign to
provide technicnb assistance to the housing industry on
design rqui r e n t s for mu1 tifawi ly housing which inrprwe
accessibi l i t y for disabled individuals.
55 NC Asslstlve Tachnology Project
Provides funding to support the Assistive Ttchnology
W s t r a t i o n Centers in providing technical assist-,
training. and equipnt Imns to individmls with
d i d i I i tits and their fmi lies.
Health and Human Sewices
Overvim 1999 Session Fiscal and Budgetary Actions
(1 3.00) Division of Health Sewices
56 Rayall Children's Vision Screening Impravement Pgm
Provides fundi ng for a statewide training and certi fication
progrm for school-bsed vision screeners (HI3 168, Set.
11.60).
57' Healthy Start Foundation
Prov~des funding for the statewide public informtion and
education activtties of the First Step Campaign. A t s o
provides funding for local c m n i ties t o ~mplement pi lot
program aimed at reducing infant mortality (HB 168, Sec.
11.60).
58 Qs t e op~o s lTsa sk Force
Provides funding to continue support for tk Osteoporosis
Task Force (HI3 1 68. S c , 1 1 -58).
59 State Games of North Carolina
Provides funding for the betnor's Council on Physical
Fitness to support the State Gems.
80 Arthtltla Prevention Project
Continues grant-in-aid for a private, jmal project providing
services for arthritis patients in Mcklenbuq County.
81 SUO Program
Provides funding to start up ad operate imprwed, intensive
investigation of sudden unexpected deaths of infants and
yMlng children.
62 Cancer Control Progrem
Provides funding to the Advisory h i t t e e on Cancer
mrdination and Control to pramte prevention. tarly
detection, data col lection, and optiraal care in the cdmC
of cancer.
63 Pediatric Cancer Services
Provides funding for pediatric cancer awareness, victim
assistance, and clinical trials of experimnbl treakments.
64 Asthma Education Pmgram
Prov~dts funding to support mtha management. control,
survei I lance. and education.
%5 HepaUtls C Education Awars-
Provides funding for Hepatitis C education and mwrencss
activi ti ts.
66 Central Cancer Reg*
Provides fundirrg for additional Central Cancer Registry
persanncl .
Heam and Human Sewices
Overviw; 1999 Session Fiscal and Budgetary Actlons
67 HeaRhy CaraUnlans
Provides funding for the creation of Healthy Carolinian Task
Forces throughout the State.
68 Birth I)efscts Monitoring Program
Provides funding to initiate the development of a birth
defects registry.
69 Hearl Disease and Stroke Prevention
Provides funding to the Heart Disease and Stroke Prevention
Task Force for impltmntatian of the NC Plan to Prevent Heart
Disease and Stroke, 1999-2003 {HB la, Sec. 11 -57).
70 OPliice of Minority Herith
Provides funding to support Office of H i n c ~ r i t y Health
activities.
(14.00) Diision of Services for the Blind
71 Early Intervention Smrvkets
Prwides funding to expand early intervention services for
viswrlly-impired chi Jdren ages birth through five years.
72 Governor Motehead School
Provider funding for library materials, textbmks, and
education-related technology.
(f 5.00) Division crf Social Services
73 L-I Adaption and Fastar Care Workem
Provides funding for addi tiwl social work staff (hired on
or after Jufy 1 , -1 in 1-1 Uepartments of social
services to recruit, train, license, and support foster cart
and zdoptivc f a i l i e s and to provide interstate and post-adoption
services.
74 Project Homeed Pilots
Provides funds to initiate pi lot program for mploymtnt.
training activities which w l d targct unski I led and
undtrski I led individuals such as current ar f o m r TAHF
recipients, nwzcustodial parents, and previously incaretrated
individuals.
75 State Matemffy Hmes Fund
Pravides funds ta bring tht budget in liiw with aettml
t ~ p c dtui r ns.
76 Family Stmess InItlatfveCPlbts
Provides funds for pi lot programs targeting at-risk chi ldren
and fmi lies.
Health and H m n Services
Overview: 1999 Session Fiscal and Budgetary Actions
77 ACH Resident Assessment Sewices
Prwides funding to establish adult care home positions in
the Department and i n county departments of social mrvices.
Effective January 1 . 2M#) IHB 168, See. lI.22A).
78 Food Banks
Provides funds for the Second Harvest Food Banks a5 fol lows:
Food Bank of Albemarle $1 66,667
F ~ a dB ank of Uorth Carofi n a 166,667
MANNA Food Bank 164,667
Second Harvest Food Bank of
Eletrolina 166,667
Second Harvest Food Bank of
Hort hwest North Carol ina 166,666
Second Harvest Food Bank of
Southeast North Carol i na 166,666.
79 Special Asslsiance Personal Needs Allowance
Increases the monthly personal needs allowance fat
State/hunty Special &ssiatance recipients f ran $31 to $36.
80 Adult Protective Senices
Provides additional funds to strpwrt additional social worker
positions providing adult protective services through local
departments of social services.
[16.00] Diision of Aging
81 Ab?heimelPs Assmiation
Increases fund~ng for the three chapters of the bkrrth
Carolina Alrheimr's A s s i a t i m {HP 168, Sec. I f . l 6 > .
82 Start-up Gram For Adult Day Care Prcrgnms
Provides funding for up to 10 start-up grwts for mw Adult
b y Care Programs.
Provides f undi ng for 15 nurse consul tank to improve the
timeliness 05 emplaint investigations in loq-tern cart
facilities, Effective January 1, 2000.
84 ~ m u Cp& ~ ~ n i t ~Sitanff g
Provides 15 additional positians to m i t o r gmyr can
facilities, including one administrative position for Adult
Care Hosre Certification.
Health and Human Services
Overvim 1 999 Session Fiscal and Budgetav Actions FY 93-2900 FY 2000-01
(18.00) Division of Medical Assistance
85 Physician Rates
Increases physician rates to mtch Medicare rates.
86 Expand Transniinal Medicaid to 24 Months S2,0?3,000 R $8,271,143 R
Expands transitional Hedicaid for former TANF recipients frm
12 to 24 mnths. Effective no earlier than October 1 , 1999
(HB 168, Set. 1T.81.
(1 9.00) Div. of Services for Deaf/Hard of Hearing
87 Cued Speach Center, Inc. $1 35,000 R $135,000 R
Provides a grant-in-aid for the Cued Speech Center. Inc. for
prexhoal, Iransitional, and resource services.
88 North Carolina s h o d for the Dmf $275,000 R 3302,600 R
Provides funding for fwr psit~ons: .Occupational Therapist $275,000 HR
I l l , Physical Therapist I l l , Staff Development Specialist. 4.M
and Canwnunlty Employment Specialist I I . Also provides
funding for the estabIistvRent and operational support of a
video netmrking site, for library materials and atmation,
for an elevator in the elementary school, and for playground
cqui prnent .
total Legislative Changes
total PosM Changes
Revised Budget
Health and Humn Sewices
Special Provisions
1999 Session: H8 468
Department:
Section 5
DHHS Block Grant Provisions
Summary Maintains funding of various Mock grants at FY 1998-99 levels.
Highlights fm f emporary Assistance for Needy Famili FANF) Bbck Grant:
1) $1,900,000 to enhance the Special Children Adoption Fund
2) $1,400,000 for Local DSS foster care and adoption workers
31 $2,000,000fo r Intensive Family Preservation Services
4) $3,000,000fo r expansion of EsClFi~sSt top Progmm
5) $12,300,00f0o r rate increases for child care subsidies
6) $7,000,000 for domestic violence programs
7) $1,000,000 for Boys 8 Girls Clubs
8) $10,200,000tr ansfer io SSBG to mambain c umt f unding
9) $1 60,000t o implement HB 17 59 "Protection from Violent Caregivers"
Section I 1
Summary Authorizes the Cadiher of Rules to rewganize the rules to ded the recent reorganhation of the
Department of Health and Human Sewices and the Department of Envimnment and Natural
Resources. Exempts these changes from Zfie Rules Review Cammission approval as long as the
changes do not change the substance of the rules.
Secim 11.1
ffik Prescription Drug Assistance Progm
Summary Requim DHHS to develop a proposal for a pmwlption drug assistance progm to sEnvs h-i
n m e elderly and disabled persons who are not eligible for Medicaid and who need presctlption
drugs to treat chronic conditions.
Section 11.2
r*: Study m Traumatic Brain Injury
Summary Requim DHHS to study the long-tern wsts of treating petgons wlth Twmatrc Brain Injury and
the feasibility and cost of a Medieaid Communrty Alternatives Program Waiver to provide
Medimid ssrvim to persons with a braurntic brain injury.
SeEtion 11.3
TI*. DHHS EmployeWIn-Kind Match
Smrnary Allows the O Mof Rural Health and Resmree M p m e n t t o m eas the W sma tch
requirement for establishing the State's health care cost containment stfategi*.
Health and Human Services
Section 11.4
Title: Establshment of Division of Education SenricedReview Disabiltty Services
Summary Directs the Depwtmmt to: I) mate a separate Division of Education Services for the residential
schools, to be led by a Superintendent with a strong background in education, 2) reorganize the
administretion and delivery of servlces (w~thinth e limits of existing law) in the Divisions of
Vccabonal Rehabilitation, Services far the Blind, and Services br the Deaf and Hard of Hearing
to maximize resources for improving services to clients, and 3) conduct a comprehensive review
of the adequacy and effectiveness of programs and services for deaf-bYnd citizens.
Sedion 11.5
Title: ABCs Plan in DHHS Schools
Summary Permits the Department ta retain unobligated, nonrecurring funds appropriated in 1998-99 for
implementation of the ABCs Plan in the DHHS residential schoois.
Section t 1.6
me: Pmedure for Award of Human Services Grants
Summary Establishes the procedures for the award of human sewices grants.
Section 11 -7
T*: Non-Medicaid Reim bursemerrt Changes
Summary Sets eligibility levels for non-Medicaid reimbrsebk services. Raises the income eligibility from
7 15% to 125% of the federal poverty level for the AtypieaUAntipsychotic Med'ktions Program. +
Title: Long-Term Care Continuum of Care
Summaty Directs DHHS and othr State end bF agencies to develop and imflment a system of long-term
care for dderly and disabled individuals and their families. Requires a progress report by
April 15,2000.
T i : Tmnsfer of Certain Funds AuthoM
Summary Atlaws the Dir&or of the Budget b bmsfer certain bnds to local departments of a a l Wm,
public health, and area mental health authoritis in order to assure maximum utilization of ths
funds.
Title: * * Adhmmbm to Expand ~m~lsitionMael dicaid
Summary Authwhes the expansion of transitional Medimid b e dfo r Wwk First familk from 12 to 24
months. E M i no eader than October 3,1999.
Heam and Human Services
Seetion 11.9
Title: Additional Dental Benefits Under Health Insurance Program for Children
Summary Adds the following dental benefits to the Health Insurance Program for Children {NC Health
Choice): second fluoride treatment, sealants, simple extractions. therapeutic pulpotomies, and
prefabricated stainless steel crowns.
Section 77-10
Title: Allocation of G.S. 143-23.2 N d ' i i d Funds
Summw Allocates $84 million for FY 1999-2050 and $29 million for ff 2000-01 in the G.S. 143-23.2 fund
io the Medicaid program, notwithstanding the pmvisiuns of G.S. 143-23.2(b) that These funds not
be used to reduce Skate General Fund revenues to the Medicaid program. CIaFifies G.S. 143-
23.2(b) to ensure funds shall only be allocated as specHically provided in the current
appropriations act.
Section 11.11
Tile: Study Increase irl Resource Limits for Aged, Blind, Disabled Persons to Q ~ rfoir M edlcaid
Summary Requires DHHS to sf udy the cost and feasibiiily of ofpling the amunt d the resources limits far
aged, blind, and disabled persons to qrralrfy for Medicaid.
Titk: Medicaid Antipateel Changes
Smmary Establishes eligibility requirements far the Medi&d program. Establishes the sewices pmvided
under the State's Medicaid program and the sflowable payment lwefs for providers under the
State's Medicaid program.
W i n 11.13
Tfle: Oepertmsntaf StudyIMeddid Cmmg9 for Mediwlly Neoessary Pmtheks or Orthotics
Summary Requires OHHS to study providing MediEaM cowrage for medically necessary pmh?tics or
ornotics for Medicaid digibk persons age 21 and o m .
flue: mnti~Pa rticipation in Ms d i c ~ i d
Summary Directs the Joint Legislatire Heam Care Oversight Committee ta reviw, m p l and maw
recommendations on issues regarding dental -re accgss for M N i i d diem.
Title: UtilMion Impact on Inflatio n-aIry for HaspitaIs and Nursing h m
Summary Alim PHHS to implement infationary increases up to $5 million fw tmpltals and nursing
homes, if funds are available,
Section 11.15
T i : Senior Cenbr Outreach
Summary Spe&es how Senior Center Omeach funding may !M used to enham mior citizen center
programs, especially in undersewed areas.
Health and Human Services -0 IS
Sedan 11.16
Title: Allocates funds for Alzheimer's Association Chapters in MC
Summary Provides funds for Ahheirnets Association Chapters in NC
Section 11.17
Till@: Fire ProMbn Fund
Summary Authorizes DHHS and the NC Housing Finance Agency to use up b $10,000 annually of the
pmeeds from Ihe Fire Protection Fund to provide s?aff support for fie administratian of the fund.
Section 11.18
Transfer Bingo Program to Crime bntrol and PuMic Safety
Summary Authorizes a Type I transfer of the Bingo Program in DHHS's; Owision of Facil'i Services to the
Department of Cnme Control and Public Safety.
Section 11.20
Tfile: Plan for Accred-Mion of Adult Care Homes and Assisted Living Facilities
Summary Requires DHHS to study amd develop a plan for the accreditation of adult a m homes and
assisted riving facilities, including a plan for enhanced payments to facilities which meet
accreditation cribria.
SectMn 11.21
Title: Special Assistance Demonsbation Project
Summary Authorizes DMHS to use funding from the existing SWCourtty Special Assistance for Adults
Program to provide Special Assistance payments to up to 400 eligible individuals in in-home
living arrangements. These payments may be made for a two-year period.
Section 11.22
Xd@: Adult Caw Home Reimbursement RatelAduA Cam Homes Allocation of Nonfedeml Cost of
Medicaid PaymentdSaalfIng Gmnt
Summary lncleasea the StaWCounty Specid Assfstance mte from $956 per month to $982 per month
dbetive October 1,1999. lnweases the SbteECounty Special Assistance WE from $982 per
month to $1,076 per month, effective October I, 2000. Continues the staffing grants. AuthortZ~s
DMHS to use funding brn Statelcounty Specbl Assistance for Adults Prognm to expand
Medicaid Personal Care Senrice$.
Title: Adult Carer Home Resident Asseswnent Services
Summary Directs Ml funds approprhted for State and 1-1 positions for asmshg prospeche adult mre
M eIc( isnts be us@ Far personnel trained in the specific Wt d dde r adults and the disabled,
Additiwrally, tfrese positions are direcbed to devdop and collect re?wi~dfa ta, provide technical
assistance to adult care hwne staR on how Zo conduct fwrdional asslassments and develop care
plans, and Ca menitor the Special Assistam Demonstration Progmm.
Health and Human Sewices
Section 1 1.23
Ti*: foster Care Assistance Payments
Summary Maintains the Foster Care Assistance Payments established duting the 1994 Legislative Session.
Section 11-24
rue: Adoption Assistance Payments
~ummary Maintains the gradtated monthly assistance payment schdule as established by the General
Assembly during the A 994 Session.
Title: Authorized Additional Use of HW Foster Care and Adoptive Family Funds
Summaw Maintains the additional assistance payments for families in whkh foster care snd adaptire
children are at risk of HWlAlDS or have been determined to have HIVJAIDS.
Seclian 11.26
Title: Child Pmtect~veS ervices
Summary Allows DHHS to allocate funds for local child prot@ct~vsee wices staff based on caselaad weds.
Section 11.27
Title: Child Welfare System Pilots
Summary Requires OHMS ta plan fw the impbmentation of dual tmh child welfare system pilots.
Title: Child Welfafe System Improvements
Summaw Mandates p m ban d pwsewTVktrea ining for local child w d fms ervices staff and Prlbws
DHHS to grant an exception if appkanis are able to dmsbate competency through gmdu8tion
from an aadited social mrlc program or enmltment in a masteh lev4 program after Juty 1,
1999.
Section 11.29
TM1 Limihtions on State Abortion Fund
Summary Maintains the mtdtrlctions kt use ot the SWB kh%mF und ~SW- d mthe 19%
Legislative Session and utilized since FY 3995-98.
secth 11.30
Child Caring Institution Rules EffectSve
Summary Allows for amin rules [inadverlently amitled from the ruling-making process) impaetlng child
cafing agencies to b e m effective.
Section 91.31
me: Work first Program Integrity ActluWes Funds
S u m r y Dire& OHHS b alfomte $2,506,000 to counties as grnb-baid to mhance Work First p m m
integrity activities. Unspent funds will revert to the State.
Heah and Human Sewices ~ G I I
Summary Allows DHHS, if funds are available and with State Budget approval, to pass slang across-the-board
salary increases to contract physicians who provide services to Slate institutions.
Section 71.33
Titie: Liability Insurance
Summary Allows DHHS (as welt as other State agencies) to prwide liabilii insurance for State employees,
including physicians, dentists, ek.
Section 11.34
Title: Private Agency U n i h Cost-finding Raqarimment
Summary Allows DHHS to ensure that a private agency or provider is not reimbwsed twice for the same
service when wntracting with twe or more area mental health authorities.
Section 11.35
Title: Funds to Reduce Waiting List for Services for Developmentaffy Disabled k m n s
Summary Requires DHHS to use ?6&,00[1,060in funds appropriated to address he needs of individuals
waiting for developmental senli*s.
Section 1 1.36
Study of State Psychiatric HospitalslArua Mental Health Programs
Summary Maintains reporting requirements for a report mandated during the 1998 Session.
Section 11-37
Tflk: Butner Community Land Resemtim
Surnmatjr Requires DHHS to resenre specified tand, loceted in the mmunlty of Butnw, foP community
purposes; requires DHHS to transfer certain land in the event of incwpclmhn of the community
of Butner.
Section T1,38
fitk Mental h t t h Funds fw Crisis Services
Summary Allows the use of funds appropriated fOr crisis wwices to be used to meet the short-tern needs
of mentalfy retarded children in crisis.
Tie: Mental Health Resenre k r Medicald Match
Summary Requires OHHS to ensfer only those hmds achstWy wpemled fw Ute nonfederal &are of area
mental health authorfties' Medimid costs during FY 1998-99; holds harmless area mental k l t f l
authorities in the event the FY 189940 appropriathn for match is inadequate; and Institutes the
poiicy of counties sharing the noniederal cast of area menbtal health authoriti#WMedimid services.
Health and Hman Sawices D 18
Section 11.40
Title: Use of W~llteM ./Thornas S. funds
Summary Requires OHHS to continue to meet the needs of former VVillie M. and Thomas S. cbss members
as well as others who would otherwise have been served in the former court-mandated
programs, Also allows DHHS to us@ up to $4,900,000 in funds avaYable to the Department to
meet the needs of elrgibk individuals.
Section 11.47
Title: Author* to Access Cash R e $ e ~ eosf OMHODISAS Area Program Faurwlatim far
Reimbursement for Disallowed Expendttures
Summary Gives DHHS the authority ta access funds from area mental health authorities which have set up
foundations or other financial arrangements in the event of disaHuwed State or federal
expenditures.
Seetiin 11.42
Ttb: Early Intervention Serv;'ces
Summary Implements two recommendahons from the Interagency Coordinating Council's study of NC's
early internenam system, including dwebping an interagency databse and establishing
regional barns of experts to work with chiWren with iow mcidence disabilit'res ffw example,
blindness, deafness, autism).
Section lf.42A
Title: Broughton Hospital FunddNonmvert
Summary Allow Br~lghtonH ospital b use up to $400,OM) in reversions to meet specified equipment and
capital needs.
S&n 11.43
Title: Child Cam AlWtian Formula
Summary Establishes a methmlalcgy for albmfing child care subsidy funds to caunties.
Section 11.44
Ti* ChM &re Matching Funds Requimment
Summary Prohibits the Depadmmt fmm muiring counties to provide h l matching funds a9 a condition of
receiving Stab?! child care subsidy funds.
SeEtion 71,#
Ti*: Child Cane Revolving Loan Fund
Sumrreary Permits the Department b Eontract with a Rnanclal krstiZutton to opera& the^ child Cafe RmMng
Loan Fund.
TI*: Child Care ,Market Rate Funds
SWhmry Authorins an inkmP tmsfer at Stalf unds betwgen dWions to s u mth e chiid cam
rak increase funded In the Temporary Assistance for Needy Famibs (TAUF) bhk grant plan.
Health and Human Services P w G t 7
section 11.47
Title: Child Care Subsidies
Summary Revises the Depamenf's methodology for reimbursing child care providers who serve children
remwing child care subsidies. Establishes County market rats for minimum IicenSing standads
(i e., one star chiM care center) based on the results of a recent market rate study. Provides
Fmancial incentives for centers who vo!untazrnly exceed these rnlnimum licensing standards at the
following rates: $94 [per childlper month) for a two star center, f 17 for a three star center, $20 for
a four star center, and $23 for a five star center.
Section 11.48
Title: Early Childhood Education and Development Initiatives (Smarl Start)
Svrnmar)l Clarifies that ?ha residency requimmnt fw toea1 boards does not apply to mernbem appointed
because of a position they hold (e.g., director of the local department of W a l services).
Exempts funding expended on child care subsidis from tne match requirement. Allows the NC
Partnership for Chltdren to use expansion funds to create financial incentives for reg~onalization
and to complete the amounting a ~md n tw management systems in local partnerships. Direc's
local partnerships to give priority to using the 30% mqured funding for wbsldies to augmenting
the State's supplemental payments for l~censedc hild care centers and homes earning rated
licenses which exceed the rninlrnurn licensing standards.
Title: Reimbumment and Cornpensation of Members of the NC Vocational Rehabilitation Council, the
Statewide independent Living Council, and the Commission for the Blind
Summary Codif~sst andard language permitting Council members to be reimbursed at the rates allowed by
federal taw.
Title: Family SupportrOeaf and Hard of Hearing Services Contract
Summary D i mth e Department to continue curitacting with a nonprofit organization to deliver family
suppMt mices.
Tie: Services for the BlindExtended Servlce M e r P oWns
Summary Directs the Deprbnant to eoRtinue using $250,000 for extended se* provider lpositbns at
local, nonpmt, supported ernpbymnt programs.
Title: Immunhfian Pmpm ResWution Policy
Summary Requires mthdh tram immonkation pmgarn p m h s when r wecine be#xnes wed or
unstable due to the p M d s mgjigence and unreasonable hibw to propetly hand1aMof-e the
vaccine.
Health and Human Services
Section 3 1.53
Title: Immunization Progmm Funding
Summary Permits the Department to use up to $7 million appropriated for the childhod immunir&h
program for projects and activities that are designed to increase childhood immunization rates in
N.C.
Section t1.54
Title: Intensive Home M s W n Program for Children
Sumtinary Appropriates $945,000 frwn the Work First Reseme Fund to DHHS for Ihe 1999-2000 fiwl year
for the Intensive Home Visitation Program for Children.
Title: AIDS Drug Assistance Program (ADAP)
Summary Requires the Depamnt to develop and implement a cost-containment pbn and a
comprehensive infwmatbn system. Requires 1% Depament to develop a plan for monitoring
patlent mplince. Directs the Department to report on both the cost-containment measures
and the plan for mrtoring patient compliance to the Senate Appmpriatrons Committee on
Human Reswrces, the House of Representatives Appropriations Subcwnmittes on Meam and
Human Services, and the Fiscal Reseatch Divbion by May 75,2000.
Also requiws that ADAP restrict eligibility for N 199900 to p e m s at or below 125% of the
federal poverty level using, if needed, funds from other warns within the Department to met
expenses. Directs the Department to study estimated participation rates and costs i f d i i b i l i
were raised to ZOO% or 250% d the federal poverty Eerel. The Depamnt shall fewft its
findings to the Senate Appropriations Committee on Human Resouroes, the House of
Representatives Appropriations Subcommittee on HeaZth and Human Services. and the f-1
Research Dlviswn by May 15,2000.
Section 12.56
T i : HlVlSTD Prevention SenriwdEvalu&n and Aceounlabitii of Grantees
Summaw Rquines DHHS to continue amting HIV/SfD P m t i o n Funds to community-based
mqanizaths, local health depmhmnts, and other entities to ptovide smiees lo high-tisk
individuals. Requires that contracts include submission of quarterly reporb and annual finandal
sbtarnents. Also requires the Depammt to adopt standards for the annual evaluation and
certification of recipients of prevention