NC Budget and Tax Center

North Carolina’s unemployment insurance debt is being paid down, but a little recognized fact is that it is workers who have contributed the most towards its repayment not employers.

The debt itself was a result of the historic job loss of the Great Recession and the tax cuts that were provided to employers during good times that left the unemployment insurance trust fund underfunded when it was needed the most. Borrowing from the federal government was the only way in which the state could meet its commitment to provide workers who had lost their jobs through no fault of their own with a temporary and partial replacement of their wages until the economy recovered.

Unemployment insurance payments not only mitigated even worse fallout from the Great Recession for workers and their families, it likely stopped a further decline in consumer spending and the resulting spiral of job loss that would have hit businesses harder and made the economic recovery even longer for everyone.

North Carolina policymakers took these economic conditions and the debt as a reason to enact some of the harshest cuts to unemployment insurance, many of which are unlike what any other state does in designing their unemployment insurance systems. Among the results: jobless workers receive just 14 weeks of unemployment insurance, half of the 26 weeks most states offer, and $300 less each month on average in benefits, far less than what is needed to maintain their spending and meet a family’s most basic needs. These changes and others delivered “savings” that translated into nearly two-thirds of the debt being repaid by workers.

The waiver that North Carolina recBTC - Changes to UI Benefitseived this week will mean that employers won’t receive a federal penalty for holding debt given that the state is likely to pay down the debt by May 2015. That penalty was the primary way in which employers were contributing to the debt repayment as can be seen in the chart above. State tax changes under the 2013 changes represented just 0.7 percent of total contributions by employers. Read More

Commentary

Tickets are going fast for two upcoming NC Policy Watch events that you won’t want to miss.

First is next week’s election post mortem Crucial Conversation: “What happened? Why? What now?” featuring Chris Fitzsimon, Dan Blue III, Tom Jensen and Carol Teal. Here are the details:

When: Wednesday, November 19, at noon — Box lunches will be available at 11:45 a.m.
Where: The North Carolina Association of Educators Building, 700 S. Salisbury St., Raleigh, NC 27601
Cost: $10, admission includes a box lunch.
Click here to register and learn more.

Second is our NC Policy Watch 10th anniversary celebration, which is co-sponsored by North Carolina State Senator Dan Blue, Capitol Broadcasting CEO Jim Goodmon and former Gov. Jim Hunt. Come hear from three of North Carolina’s most important leaders as our state comes to a crossroads after four years of damaging cuts to education and rolling back of progress it took a generation to make.

When: Monday, December 8, from 5:30 to 7:30 p.m.
Where: The Stockroom in downtown Raleigh.
(Click here for location information).
Commentary

childrenAs enrollment begins again, on Saturday, for Affordable Care Act health insurance, it is crucial to note that an important population—children—are still often uninsured. More than five million children in the United States lack any form of health insurance.

In North Carolina, this is particularly a problem within the Hispanic population. The state ranks among the top ten states with the highest number of uninsured Hispanic children, according to a joint report put out by Georgetown University’s Center for Children and Families and by the National Council of La Raza. The report found that 12.5% of Hispanic children in North Carolina are uninsured, which is higher than the national average of uninsured Hispanic children. Nationwide, Hispanic children tend to be twice as likely to be uninsured than their white non-Hispanic counterparts.

Contrary to popular belief, immigration status is not the main reason that these children don’t have health care coverage. The majority of Hispanic children in North Carolina are U.S. citizens and are eligible for a program such as ACA, Medicaid, or the Children’s Health Insurance Program which would provide them with health insurance at an affordable cost to their families.

The real barrier to enrollment in health insurance for Hispanic children, according to the report, can often be their parents’ limited English proficiency. A study found that more than one in eight Hispanic children, between the ages of 5 and 17, live in a household where English is spoken “less than well.” A parent with limited English proficiency may not be able to make it through a health care application in English which then results in an eligible child not getting health insurance.

Along with making Spanish language applications available for all health care programs in North Carolina, there needs to be an emphasis placed on educating Hispanic families about health care options for their children and assisting them with the enrollment process. The health care insurance options are available, we just need to do our part in getting these kids signed up.

News

Tillis_McCrory_Berger-400Governor Pat McCrory and two of his predecessors have filed suit against the General Assembly, arguing that their creation of various commissions usurps the authority of the governor’s office and violates the separation of powers clause in the North Carolina Constitution.

“These commissions make government less accountable to the will of the people. Citizens and voters must be able to distinguish which branch of government is responsible for making the laws and which branch is responsible for carrying out the laws and operating state government,” Governor McCrory said in a press release.

McCrory said recent examples of unaccountable commissions include the proposed Board of the Department of Medical Benefits, the proposed Social Services Commission and North Carolina’s Coal Ash Commission, which will hold its first meeting Friday.

The governor says while the case winds its way through the court system, the legal dispute will not hinder his ‘shared agenda’ with the General Assembly.

Senate Leader Phil Berger and House Speaker Thom Tillis responded by saying Governor McCrory’s arguments were flawed from both a legal and public policy perspective.

Here’s the joint statement released by the two legislative leaders:

“Today the governor sued to stop independent boards created in two bills – one he chose to sign and another he allowed to become law. He vetoed neither,” said Berger and Tillis. “The General Assembly’s right to appoint members to independent boards – which are beholden to no single appointing authority and provide truly independent oversight – is far from new and has long been upheld by our state Supreme Court. Unfortunately, the governor’s costly and time-consuming lawsuit to ensure he picks the majority of regulatory board members ignores history and detracts from their important work.”

You can read the 18-page complaint here.

News

A group of Wilmington-area charter schools has given up on its fight to keep secret the salary information of its employees.

On Thursday, Charter Day turned over the data requested more than a month ago by the N.C. Department of Public Instruction, allowing the management company to be removed from “financial probationary status” which had threatened state funding.

Despite marking the documents trade secrets, the Wilmington Star-News reports that salary information will be made public early next week:

‘The state Thursday said it intends to make the salary information provided by Charter Day public even though the school group had marked it as “trade secrets.”tradesecret

In an email, DPI spokeswoman Lynda Fuller said the state intends to release the information at 5 p.m. Monday.

There’s a standard provision with state contracts that if during the bidding process a vendor marks something as a trade secret that officials don’t find as a trade secret there is a 48-hour delay before that information can be released.

That’s the practice officials are employing here, according to DPI officials.’

Charter Day contracts with Roger Bacon Academies to operate its school in Leland as well as Columbus Charter School in Whiteville, Douglass Academy in Wilmington and South Brunswick Charter School in Bolivia.