Commentary

Raleigh’s News & Observer has a fine editorial this morning in which it fricassees the state Senate over the absurd bill it approved today to establish a “separate but equal” marriage system for the state. As the editorial noted:

“Sworn public officials have to do their duty, and this not-so-clever bit of legislating is certain to be found unconstitutional. Magistrates and registers of deeds don’t get to cop out of their jobs based on their personal beliefs.

This is amateur hour at the General Assembly, and a petty action that could get expensive. The legislature already has spent nearly $100,000 to have outside lawyers appeal the federal rulings on same-sex marriage. State Attorney General Roy Cooper, a Democrat, wisely decided not to press on with appeals once the U.S. Supreme Court agreed to hear the issue.

If the high court rules that laws banning gay marriage are unconstitutional, it follows that a silly maneuver like this one regarding magistrates will fall quickly in the courts as well.”

Another issue the authors might have noted and that Senator Angela Bryant and others rightfully emphasized in today’s debate is the question of “what constitutes a ‘sincere religious belief’?” Will it now be okay for magistrates who have “sincere religious” objections to interracial marriage to opt out of their jobs?

And, for that matter, what about other providers of public services? What if a schoolteacher’s sincere religious belief forbids the teaching of boys and girls together in the same classroom? What if an E.M.T. converts to a religion that forbids blood transfusions? Read More

NC Budget and Tax Center

State lawmakers are targeting cash-strapped homeowners as they continue to pursue tax changes that would shift even more of the tax load to low- and middle-income taxpayers, while preserving tax benefits that have largely flowed to the wealthy and profitable corporations.

Legislation approved by the state Senate (Senate Bill 20) would require homeowners to pay state income tax on mortgage debt forgiven by lenders. Meanwhile, financial institutions that provide such consumer relief are allowed to deduct the expense as a tax write-off.

The proposal would undermine a key element of North Carolina’s recovery from the nationwide housing crisis that fueled the Great Recession. In the wake of the crisis, a number of financial institutions  agreed to  settlements that provide consumers relief for unaffordable mortgages. This often meant reducing the amount of principal debt they owed on their mortgages to make them more affordable and lessen the likelihood of foreclosure. Furthermore, the 49-state National Mortgage Settlement encourages mortgage servicers to provide such relief to distressed borrowers affected by the housing crisis.

The goal of these settlements is to ensure that homeowners who were preyed upon by unethical lenders do not fall into the financial tailspin that foreclosure often creates. The tax change proposed by the Senate would require cash-strapped homeowners who have already suffered from the disastrous housing crisis and economic downturn to report this debt forgiveness as income, even though no actual cash is provided to the homeowners.

This could deter families from accepting bank offers to modify their mortgage loans because they cannot afford to pay taxes on the amount of relief they get. Distressed homeowners seeking to stabilize their finances and rebuild in the wake of the housing crisis would face a major setback. Read More

News

Supreme courtIn a 6-3 decision released today, the U.S. Supreme Court ruled that the state Board of Dental Examiners lacked immunity from antitrust laws and could not enforce regulations that effectively limit competition.

The case, NC Board of Dental Examiners v. FTC, arose from the Board’s repeated efforts to stop non-dentists from rendering teeth-whitening services, saying that such services constituted the “practice of dentistry” subject to its regulation.

After years of cease-and-desist orders issued by the Board to unlicensed providers of that service, the Federal Trade Commission stepped in and accused that body of stifling competition. In response the Board argued that as a state agency it was immune from antitrust laws.

The FTC and the Fourth Circuit disagreed, finding that the Board wasn’t really acting at state direction and was more akin to a private group using state regulation to restrain competitors.

The Supreme Court agreed.

Writing for the majority, Justice Anthony Kennedy found that because the Board was comprised mostly of dentists practicing and competing in the teeth-whitening market with non-dentists, it could only invoke state-action antitrust immunity if the state actively supervised the its actions concerning that service.

“The Board does not claim that the State exercised active, or indeed any, supervision over its conduct regarding nondentist teeth whiteners; and, as a result, no specific supervisory systems can be reviewed here,” Kennedy wrote.

Beyond the specific North Carolina situation, Kennedy — who was joined in the decision by Chief Justice John Roberts and Associate Justices Ruth Bader Ginsburg,  Stephen Breyer, Sonia Sotomayor and Elena Kagan —     offered this guidance:

The [antitrust laws] protect competition while also respecting federalism. [They] do not authorize the States to abandon markets to the unsupervised control of active market participants, whether trade associations or hybrid agencies. If a State wants to rely on active market participants as regulators, it must provide active supervision if state-action immunity  is to be invoked.

Justice Samuel Alito dissented, joined by Justices Antonin Scalia and Clarence Thomas.

The full opinion is here.

 

Commentary, News

It’s no surprise today’s top trending story on Jones Street is the debate over Senate Bill 2, Magistrates Recusal for Civil Ceremonies. The bill passed 32-16 and now moves to the House.

Here are a few of the top tweets:

 

Commentary

North Carolina needs serious policy solutions that create real jobs, but if the new economic development legislation unveiled yesterday is the route the state is going, it looks like jobless workers are going to be kept waiting awhile.

After weeks of closed-door negotiations, the House unveiled the NC Competes Act (HB 117), legislation which included a provision doubling the amount of money the state could spend on the state’s primary business incentive program, the Job Development Investment Grant and renaming it the Job Growth Reimbursement Opportunities People Program. This program provides public dollars to “incentivize” private sector firms to create jobs and increase capital investment.

Unfortunately, the program has not always delivered on its promises, and until it is fixed, it is unlikely that spending more money on it will improve its effectiveness in creating jobs.

Read More