Gov. Cooper says the $5.7 billion in federal rescue money can bring “transformational change” to NC

Governor Roy Cooper

Gov. Roy Cooper’s ideas for spending the $5.7 billion coming to the state from the latest federal recovery package range from offering another round of direct payments to parents to improving local water and sewer systems.

Cooper presented his proposals for widespread investments to  – among other goals –  help individuals and businesses, expand high-speed internet access, improve rural downtowns, and pay for scholarships for community college and university students.

“This pandemic brought us a once in a generation challenge, and these funds a once in a generation opportunity,” Cooper said.  “Let’s use them to make transformational change for our state. We can revolutionize North Carolina.”

Cooper proposes using some of the money to continue a modified version of a program of direct grants to parents that legislative Republicans started last year.

The “extra credit grants” would go to low- and middle-income families based on their 2019 incomes, and would cost $250 million. Families would get $250 or $500, depending on their income, with people who make less money getting the bigger grant. The maximum eligible income would be set at $60,000.

Cooper said the pandemic levied the most harm to people with lower incomes. “We need to try to get the money to families who need it the most,” he said.

The state budget office estimated that 320,000 families would receive $500 and 340,000 families would get $250.

Cooper would use some of the money to continue efforts to expand high-speed internet by spending $1.2 billion on broadband access and affordability. High-speed internet became a necessity in the pandemic when students had to learn from home and medical offices pivoted to telehealth.

The spending will ensure “every home with a school-aged child will have access to high-speed internet,” Cooper said.

Other proposals include:

  • $835 million for community college and university scholarships and grants. The NC Guarantee Scholarship would offer at least $6,000 to UNC and state community college students whose families earn less than $60,000 a year. The scholarships would phase out as family income increases to $75,000.
  • $575 million for affordable housing.
  • $175 million for rural downtown transformation grants.
  • $350 million in grants to small hospitality and related businesses, including $50 million targeted to small business owners who closed or partially closed their businesses in the pandemic to help them reopen in the existing locations.
  • $800 million to fix water and sewer systems. Aging pipes in North Carolina are driving up user bills, straining local utility budgets, and contributing to water pollution. $440 million would be use for water, sewer, and stormwater projects for distressed and at-risk water and wastewater units and $360 million would be available for all units statewide, according to the supporting budget document.

State audit faults oversight of $3.1 billion in coronavirus relief

State Auditor Beth Wood

The state Pandemic Recovery Office did not monitor spending of $3.1 billion in federal pandemic funds in a way that would catch misuse in a timely way, according to a state audit released Thursday.

The recovery office required recipients provide receipts and monthly spending reports with supporting documentation, the audit said. But the office did not independently verify the spending by comparing the reports to the supporting documents until November 2020, after most of the money had been spent.

Additionally, the recovery office sent out money without making sure all recipients had goals for accomplishing their objectives or ways to measure results.

In response, state budget director Charles Perusse and recovery office executive director Stephanie McGarrah said the state legislature funded the office at half the requested amount, which resulted in understaffing and a delay in full verification of recipient spending. The office established a nine-step process that balanced release of money to recipients with monitoring expenditures, they wrote. The office is adding staff in response to the audit findings.

In December, the Auditor’s Office released a report  critical of the state Department of Public Instruction’s monitoring of coronavirus relief fund spending. The audit faulted DPI oversight of the summer learning program and the school nutrition program.

The state legislature started the distributing the federal money in May 2020. Initially, federal law required it be spent by December 2020.

Thursday’s audit looked all 490 recipients of Coronavirus Relief Act money. Forty-three recipients did not report objectives, 302 of 447 reported objectives but no goals, and 57 of 145 reported objectives and goals, but had no way to measure progress, the audit said.

In their response, Perusse and McGarrah wrote that lack of staffing and funding, and the temporary nature of the recovery office contributed to the finding that performance measures “were not as robust as they could have been.”

The recovery office is set to dissolve in December.

Apple to bring $1 billion investment, 3,000 jobs to the Tar Heel state

 

Governor Roy Cooper, Senate President Pro Tem Phil Berger, Senator Dan Blue, Speaker Tim Moore and Rep. Robert Reives issued a joint statement this morning after Apple announced its decision to build a new $1 billion campus in Wake County, hiring 3,000 employees:

“Innovation has long been North Carolina’s calling card and Apple’s decision to build this new campus in the Research Triangle showcases the importance of our state’s favorable business climate, world-class universities, our tech-ready workforce, and the welcoming and diverse communities that make so many people want to call North Carolina home. This announcement will benefit communities across our state and we are proud to work together to continue to grow our economy and bring transformational industries and good paying jobs to North Carolina.”

Gov. Cooper took to social media this morning welcoming Apple to the state.

Commerce officials say will be Apple’s first entirely new US campus in more than 20 years and signifies a long-term investment in the state and region.

Officials will be holding a joint press conference this morning at 9:30am at the North Carolina Governor’s Mansion to discuss the investment.

Policy Watch will have more reaction to this developing story throughout the day.

$1.3 billion coming to NC to support the child care industry

North Carolina is getting $1.3 billion from the latest federal COVID relief package to rebuild the child care industry and support student enrollment.

The Biden White House announced Thursday it is releasing $39 billion to states and territories from the American Rescue Plan to help the ailing child care industry, money intended to help support a broader economic recovery.

Vice President Kamala Harris called the money “the single largest investment in child care in our nation’s history,” in remarks Thursday. “When it comes to child care in our country, families need help.”

North Carolina is getting $503 million for the child development block grant, which can be used to help cover tuition for families with low incomes, and $805 million for a “child care stabilization fund,” money that can go to child care centers and child care homes to help them make rent or mortgage payments, improve their buildings, or pay other pandemic-related costs.

The child care industry suffered in the pandemic. Some centers shut down temporarily the early months. Ninety-six percent had reopened as of February, according to NC Child, but enrollment is down 40% from pre-pandemic figures.

Last year’s federal COVID-19 relief packages also included money for the child care block grant. The March 2020 relief bill had $3.5 billion, and the December bill had $10 billion, according to the Bipartisan Policy Center.

“Without consistent, affordable child care, parents – mostly mothers – are not able to go back to work. About 2 million women were forced to leave the workforce,” many due to child-care issues, Harris said.

“The strength of our county, the resilience of our economy, depends on the affordability and availability of child care,” Harris said.

Fawn Pattison, campaigns director at NC Child, couldn’t find enough superlatives to describe an additional $1.3 billion coming to the state for child care.

“It really is amazing,” she said. “Not just the opportunity to rebuild the ailing child care sector. We can make sure more kids can be prepared for kindergarten. Early education is where you get the most bang for the buck.”

Getting children ready for kindergarten increases the likelihood they will graduate on time and enjoy long-lasting health benefits, Pattison said.

“I think we need a yardstick to measure success by,” Pattison said. “It would be just tragic if it did not result in a big impact.”

Amy Cubbage, president of the NC Partnership for Children, said the money offers the opportunity to improve child care salaries, which will help recruit and retain quality teachers. The average wage for a child care teacher in the state is $12 an hour, she said, which leads to high turnover and instability for children and families. Cubbage said she hopes some of the money can be used to bring to more communities a program called WAGE$, which supplements salaries of low-paid teachers, directors and family child care providers.

The money coming to the state can set the stage “for a long-term, well-funded system of early education across the state,” she said.

Cooper proposes asking voters to approve $4.7 billion for school and state building projects.

Gov. Roy Cooper has again proposed that voters approve borrowing money for statewide construction and renovation projects.

But the idea of borrowing, no matter who comes up with it, has proven to be hard to get legislative approval recently. Senate Republicans prefer paying for buildings with direct appropriations.

As part of his budget this year, Cooper has proposed putting a $4.7 billion bond to a vote in November.

-$2.5 billion would go to K-12 school construction.  A report from the State Board of Education and the  Department of Public Instruction based on a 2015-16 survey found school districts needed $8 billion for buildings, additions, renovations, and other capital costs.

-$500 million would go to community colleges

-$783 million would go to UNC campuses. The largest project is a new Brody School of Medicine building at East Carolina University, at $187 million.

The recommendation includes money for renovations at two of the state’s development centers and two of its neuro-medical centers, the state alcohol and drug treatment center in Black Mountain, and money to expand TROSA, a residential addiction treatment center based in Durham, to the Triad.

The bond recommendation includes $229 million to move the state Department of Health and Human Services from the Dorothea Dix campus in Raleigh to Blue Ridge Road.

Assorted state attractions would get a total of $460 million, including $70 million for NC Zoo exhibits.

Cooper included a $3.9 billion general obligation bond as part of his 2019-20 recommended budget that the legislature did not consider.

The state House has been amenable to the idea of asking voters to approve borrowing for capital projects. In the last two years, House Republicans have put together their own bond proposals, and passed them with little opposition.

In 2019, House Speaker Tim Moore cosponsored a $1.9 billion school construction bond bill that moved swiftly through the House and died in the Senate.

approval.

The House tried again last year, passing a $3.1 billion bond bill with the money to go to school construction and transportation projects. That bill also died in the Senate.