NC Budget and Tax Center
This is the seventh post in a series that takes a detailed look at the 2013 US Census Bureau poverty data released on September 18th. Previous posts examined: 1) how North Carolina is faring overall; 2) how poverty varies by race, 3) poverty by County; 4) child poverty; 5) the impact, or lack thereof, of the current economic recovery on poverty in our state and 6) the public success of Social Security in bringing down poverty rates for older North Carolinians.

The latest data on poverty released by the U.S. Census Bureau last week confirms that work does not inoculate adults from experiencing poverty. One in three workers in North Carolina earned poverty wages, up from a low of 24 percent in 2002. The proliferation of low-wage jobs not only makes it difficult for workers to support themselves and their families but it puts a drag on the entire economy by depressing consumer spending.

The poverty threshold for a family of four in 2013 was $23,834. A full-time, year-round worker would need to earn an hourly wage of $11.46 to reach that level. That is well above the current federal and North Carolina minimum wage of $7.25 as well as higher than the proposed increase in the federal minimum wage to $10.10. And yet, low wage workers play key roles in the lives of our communities: they are home health aides who care for our parents or child care providers who are entrusted with the care of our children or bus drivers who get us safely to work each day.

In the increasingly prominent public debate about the falling wages of workers and the failure of the wage standards to ensure work pays, this latest data provides further evidence that workers are not only struggling but that it doesn’t have to be this way.

The trend data show that progrWorkers and Povertyess was made in the state for workers over the past thirty years but has been reversed more recently. North Carolina actually performed better relative to the rest of the nation through the 1980s and 1990s seeing a rapid decline in its poverty rate for workers over that period–an actual reduction from the high of 44 percent of workers earning poverty-wages in 1983. This faster decline is largely attributable to the state’s stronger employment opportunities than the nation in middle-wage industries like manufacturing and construction during that period as well as lower income inequality.

Beginning in the 2000s, those gains were lost as North Carolina began to see an increase in the number of workers earning poverty-wages. Contributing factors to this trend are likely the significant job loss in manufacturing and construction, the fallout of two successive national recessions and the significant growth of low-wage work since 2009. As of 2013, the share of North Carolina’s workers earning poverty wages was four percentage points above the national average.

When workers earn poverty wages, the entire economy struggles as does the broader community. That is because as workers struggle to meet their family’s most basic needs, they are less able to consume on main streets or pay their rent or mortgage. Workers who work hard yet earn poverty wages seek out other ways to bridge the gap in their income whether that be through taking on additional jobs, reducing their time to support their children’s development and their family’s well-being, incurring significant debt through the use of credit or informal loans to make needed payments, or seeking out resources or support from private charities or public programs. The result is an economy that fails to ensure work pays and can support strong local economies through vibrant main streets and stable families.

Commentary
DHHS Sec. Aldona Wos

DHHS Sec. Aldona Wos

If there’s anything positive about placing our state under the control of right-wing politicians, it might be this: the fact that it forces at least some people to, eventually, confront the hard reality that cut rate, on-the-cheap government rarely works. This fact is apparently being slowly brought home of late to North Carolina’s embattled Secretary of Health and Human Services, Aldona Wos.

As WRAL.com reports this morning, Wos is calling for millions of new dollars to be spent on the state’s troubled medical examiner system:

State health officials told lawmakers Monday that they need about $6 million more a year to fix the medical examiner system, which has failed to meet minimum national standards for staffing, training and facilities.

Lou Turner, deputy section chief for the state Department of Health and Human Services, told lawmakers that the agency has been asking for more money and staff for a decade but lawmakers haven’t listened.

“It did not get funded. It did not go forward,” she said.

Put simply, Wos and her team are learning what a lot of crusading anti-government ideologues learn when they are faced with actually making the trains run on time: Notwithstanding the propaganda from the right-wing think tanks, providing high quality public services costs real money.

Let’s hope state lawmakers respond favorably to the new DHHS request and, more importantly, that North Carolina’s elected leaders learn an important lesson from the experience — namely, that it’s shortsighted and destructive to try to run the public structures and services that bind our middle class society as if they were some kind of bottom feeding chain of retail outlets.

News

The first million dollars in taxpayer-funded school vouchers have been sent to private and religious schools across North Carolina, the AP reports.

From the News & Observer:

The first million dollars have been sent to private and religious schools across North Carolina while an appeals court considers a judge’s ruling that a new scholarship program for low-income public school children is unconstitutional.

About $1.1 million was distributed last Friday to 109 private schools that accepted students under the Opportunity Scholarships program, State Educational Assistance Authority grants director Elizabeth McDuffie said Monday. That distribution was to cover part of the tuition for 568 students, according to the state agency administering the program.

The schools were primarily Christian, Baptist, Catholic or Islamic. The Greensboro Islamic Academy received the most money, $90,300 for 43 enrolled students. Word of God Christian Academy in Raleigh received $54,600 for 26 students.

Earlier this month, The N.C. Court of Appeals ruled that the 1,878 students who have already been granted school vouchers can now use those taxpayer dollars at private schools while the fate of the program is decided. But the program cannot continue to award vouchers while the case is still tied up in the courts.

An August ruling by Superior Court Judge Robert H. Hobgood found the school voucher law, enacted in 2013, to be unconstitutional, halting a program that as Judge Hobgood said, “appropriates taxpayer funds to educational institutions that have no standards, curriculum and requirements for teachers and principals to be certified.”

Hobgood’s ruling is under appeal by the state’s attorney as well as defendant-intervenors for parents and Speaker Thom Tillis and Senate leader Phil Berger.

Attorney Robert Orr, who represents the N.C. School Boards Association, told the AP, “everybody’s on notice that the court has already ruled at the trial level it’s unconstitutional. In the long run, if the trial court’s decision is affirmed, then we would look to the state to recover the public’s money. You have to emphasize that it is the public’s money that we’re talking about.”

Read the full story by AP reporter Emery Dalesio here.

News

voteAs we posted earlier today, the justices of the Supreme Court were considering an emergency stay of lower court rulings finding Ohio voting law changes unconstitutional.

That request apparently went to the full court and, as Lyle Denniston at SCOTUSblog notes here, was granted:

With just sixteen hours before polling stations were to open in Ohio, the Supreme Court on Monday afternoon blocked voters from beginning tomorrow to cast their ballots in this year’s general election.  By a vote of five to four, the Justices put on hold a federal judge’s order providing new opportunities for voting before election day, beyond what state leaders wanted.

The order will remain in effect until the Court acts on an appeal by state officials.  If that is denied, then the order lapses.  It is unclear when that scenario will unfold.  The state’s petition has not yet been filed formally.

News

The North Carolina Department of Public Instruction received 40 applications this month to open up new charter schools in 2016, down from last year’s applicant pool of 71.

N.C. Office of Charter Schools director Joel Medley acknowledged the applicant numbers are down this year.

“It may be the application fee was raised from $500 to $1000. It may be that the timeline was moved forward a couple of months. It may be that some groups are waiting to submit using the new Fast Track Replication process,” Medley told N.C. Policy Watch, adding that he couldn’t give an accurate reason for why the numbers are fewer this time around.

Fourteen of this year’s applicants (click here for a spreadsheet listing the applicants) have indicated they plan to contract with education management organizations (EMO). For-profit EMOs were thrust into the spotlight during last summer’s legislative session, when the General Assembly approved legislation that allows private, for-profit charter school management companies to keep their employees’ salaries secret, even though they are paid with public funds.

At least ten of the forty applicants are re-submissions from prior years, Medley told N.C. Policy Watch.

According to the Office of Charter Schools, there are currently 148 charter schools in North Carolina—a figure that expanded quickly when lawmakers lifted the 100-school cap on how many charter schools could operate in the state back in 2011.

But last year, the pace of charter school approvals slowed down considerably. While the State Board of Education approved 23 charter schools to open in 2013 and 27 schools to open in 2014, only 11 out of 71 applicants were green-lighted to open in 2015, a figure that prompted a heated debate between Charter School Advisory Board (CSAB) members tasked with reviewing the applications.

According to the Charlotte Observer, CSAB board member Alan Hawkes of Greensboro emailed his fellow members to chastise them for being “judgmental and punitive” in rejecting plans that would have expanded charter school enrollment.

“The plan was to have operators come into the state like they did in Louisiana and other states and quickly affect the public school choice landscape for the better and in quantity,” said Hawkes, a founding board member of two Guilford County charter schools run by the for-profit National Heritage Academies. Hawkes also indicated that he received heat from Sen. Jerry Tillman about the low number of approved charter school applications.

Reviewers of charter school applications may prove to be more cautious now, in light of the fact that a few charter schools have abruptly closed thanks to poor financial management and other governance problems.

Most recently, Concrete Roses STEM Academy in Charlotte shut down 20 days into the school year. The school had its funding frozen by the state after the school failed to submit required financial forms. The school’s sudden closure left families of the school’s 126 students scrambling to find new schools, while taxpayers likely lost the $285,170 the school already withdrew from the state’s coffers.

For some who wish to open a charter school in North Carolina, there’s still another option for submitting applications for 2016. Thanks to legislation passed last summer, a fast-track process has been put in place for successful charter schools wishing to replicate themselves and for charter chains wishing to expand their presence in the state. The State Board of Education must adopt rules for the fast-track replication process no later than December 15, 2014.