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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
Object Description
Description
Title | Highlights, fiscal and budgetary actions |
Other Title | Overview, legislative session fiscal and budgetary actions; Overview, fiscal and budgetary actions; |
Date | 1999 |
Description | 1999 |
Digital Characteristics-A | 40 MB; 304 p. |
Digital Format | application/pdf |
Full Text | 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 |
OCLC number | 213077756 |