NC Budget and Tax Center

Landmark bill would strengthen early childhood education in N.C.

Earlier this year, the Budget & Tax Center released a report analyzing the role that public investments in North Carolina’s early childhood workforce could play in supporting our state’s goals of delivering high quality learning experiences to our youngest children. As the 2019-20 legislative session presses on, the early childhood education workforce and its advocates are hopeful that they may see historic legislation passed this session.

Last Friday, the North Carolina House passed House Bill 882, a landmark bill that would strengthen the quality of early childhood education in North Carolina and help ensure early childhood educators can meet their needs and provide quality care.  The bill would make progress toward these goals by focusing on:

  • High Quality Learning – The bill establishes increased educational and professional standards that support high quality learning for students. More specifically, the bill requires lead teachers who are hired as of Jan. 1, 2020, to have the infant Toddler or Preschool Certificate or equivalent by July 1, 2021. Additionally, the Division of Child Development and Early Education (DCDEE) is required to develop expected professional standards and core competencies for lead teachers and create a process for teachers to demonstrate they have achieved these standards.
  • Compensation for Early Childhood Educators – In recognition that infant and toddler educators in North Carolina experience the lowest wages and minimal education requirements, the bill requires DCDEE within the Department of Human Health Services (DHHS) to develop a program that will create incentives for higher teacher education and compensation by providing subsidy incentives for child care programs to employ and pay teachers who have an associate degree or higher by July 1, 2020.
  • Targeted Program for NC’s Youngest Children —DHHS/DCDEE is also required to conduct a Feasibility and Cost Study to create a special Infant and Toddler child care program. The implementation of these programs creates incentives for careers and early education and may help lay the ground work for compensation to be placed within Quality Rating and Improvement System (QRIS) standards.
  • Data and Accountability— State level assessment and monitoring of the early childhood workforce is established through the bill’s requirement for a report on the status of the early childhood workforce every three years.

The Senate now has the to make certain that every infant is safe and developing, every toddler is thriving, and every preschooler is prepared for kindergarten.

 

 

NC Budget and Tax Center

Senate bill will take food assistance away from families while costing N.C. millions

Today, the North Carolina Senate will vote on a bill aimed at punishing parents who struggle to keep up with child support payments by taking away their food assistance. Senate Bill 551, the Child Support Cooperation Act, is based off of myths and stereotypes rather than an actual understanding of what families with low-incomes actually need.

Here are some realities about the negative impacts of child support enforcement in SNAP:

  1. Taking away food from struggling parents will not result in increased payments.

Under this policy, North Carolina can choose to punish custodial parents who choose not to open a child support case or modify or enforce an existing support order, in addition to parents not keeping up with payments. Child support enforcement for SNAP families is already fairly strong. In fact, over the past 20 years, the amount of financial support paid by parents has increased by 22 percent.  Additionally, the program already provides incentives for parents who do cooperate.

  1. This policy risks increasing food insecurity among survivors of abuse and the children they care for.

The reality is that many non-custodial parents are providing informal support. Parents who earn low wages and have inconsistent schedules may pay when they are able. Other parents may support their children in other ways by co-parenting or buying supplies. Parents who choose not to participate in the child support system often do so for good reason. For example, a study from Texas found that more than 4 in 10 mothers who did not receive any type of child support were survivors of abuse.

Senate Bill 551 doesn’t acknowledge that people’s lives, circumstances, and needs are complex. Instead, this blanket policy threatens to remove food from people already struggling to make ends meet who are caring for children.

  1. This policy is costly and complex to administer.

Similar to other policies that seek to limit who can access federally funded social support programs, Senate Bill 551 will cost the state money to administer and will result in zero savings. A study done in 2017 estimated implementing this policy would cost North Carolina more than $5.6 million. In addition to the costs, attempting to enforce this would add additional paperwork and red tape for families seeking food assistance as well as the DSS offices and case workers charges with helping them.

Just last year, North Carolina ran a similar pilot program requiring families receiving child-care subsidies to participate in the child support enforcement program. The study found that only 90 percent of families were not already participating or exempt. In the end, forcing families to participate resulted in $7,000 in increased child support payments in 12 families while costing the state $2 million to implement.

There are better ways to support struggling families.

This is not the first time a bill like this has been seen. In fact, a 2014 study found that out of 10 states that had adopted this very same policy, seven states had rescinded because they discovered it was costly, burdensome, and did not help families.

There are ways to encourage cooperation in the child support enforcement system that do not put people at risk of food insecurity. Rather than taking away food support, lawmakers should seek to understand the needs of struggling families and remove the real and primary barriers to putting food on the table.

Brian Kennedy II is a Public Policy Analyst for the Budget & Tax Center at the N.C. Justice Center.

Commentary, Courts & the Law, Education, Environment, Legislature, NC Budget and Tax Center, News

The week’s top stories on Policy Watch

  1. Teachers and their supporters flood downtown Raleigh for second consecutive year

Downtown Raleigh came alive Wednesday with thousands of North Carolina educators filling the streets to demand lawmakers increase funding for public schools.

Educators and their supporters began to gather at the N.C. Association of Educators (NCAE) headquarters near the Duke Energy Center before 8 a.m.

By mid-morning, they were marching to the state legislature, chanting slogans and flashing signs, many of which highlighted educators’ five demands to the Republican-led General Assembly.[Read more…]

Bonus links:

 

2. Superintendent Johnson uses new website to gaslight educators

Under North Carolina’s Standard Course of Study, 6th graders are expected to understand the difference between the average and median of a distribution of numbers. So the Superintendent of Public Instruction, Mark Johnson, is certainly aware that you should never compare the median of one data set to the average of another data set. Yet that – along with a score of additional statistical no-no’s – is exactly what Johnson did in rolling out the NC School Finances website last week.

The website gathers a plethora of information on school funding and expenditures. While almost all of the information has been readily available on other sections of DPI’s website for years, this new central repository could be useful for education policymakers, practitioners and advocates (personally, I find the site slow and very user unfriendly).[Read more…]

 

3. Gerrymandering lawsuit stunner: Daughter of deceased GOP mapmaker turns over his documents to Common Cause

The daughter of late GOP mapmaker Thomas Hofeller – the man responsible for some of North Carolina’s most infamous gerrymanders – turned over four of his external hard drives and 18 thumb drives after his death to the plaintiffs suing North Carolina lawmakers.

Stephanie Hofeller Lizon gave the documents to attorneys in March, a month after she was issued a subpoena in the state partisan gerrymandering case Common Cause v. Lewis. No one objected to the subpoena initially, but Phil Strach, who represents the lawmakers in the case, is objecting to the plaintiffs’ decision to refrain from opening Hofeller’s sensitive tax and medical documents and to withhold them from the other parties to the litigation. [Read more…]

Bonus link:

Read more

Falling Behind in NC, NC Budget and Tax Center

March local labor market reveals diverging paths to prosperity

Commonly cited labor market figures like the statewide unemployment rate often mask the damage that climate-driven natural disasters, ineffective tax policy, and one-shoe-fits-all economic development has wreaked upon rural corridors in North Carolina. Since the beginning of the Great Recession, the number of the state’s employed has grown by approximately 577,500, but most of that growth has been concentrated in urban N.C.; just 10 counties have accounted for 505,000 of the jobs gained — or over 90 percent of the net state employment growth since the start of the recession. At the same time, 45 counties that are primarily in eastern North Carolina have lost nearly 77,000 jobs since December of 2007, revealing deeply troubling trends which challenge the state’s broader recovery narrative.

Solely focusing on North Carolina’s positive economic measures as proxy diagnoses for the state’s overall economic health is a dangerous game to play. Too many leaders are ignoring pretty alarming regional economic outcomes to prop up tax-cut theory. Doing so risks isolating and denying pathways to prosperity for swaths of the state.

Here are a couple of indicators illustrating differential regional outcomes:

  • Job growth is too concentrated: March’s labor market data show that with more than 400,000 jobs created, just five counties (Mecklenburg, Wake, Durham, Union, and Cabarrus) have accounted for almost three-quarters of the state’s total job growth (577,550) since the start of the Great Recession. Rounding out the top ten counties were Buncombe, Johnston, New Hanover, Forsyth, and Guilford, adding almost 100,000 jobs since December of 2007.
  • Forty-five counties lost jobs since December 2007: Since the beginning of the Great Recession, 45 counties have lost jobs, many in eastern North Carolina. Robeson, Randolph, Wilson, Rutherford, and Sampson counties have lost the most jobs since 2007, a collective 26,000 job decline. March’s data also revealed 27 “double whammy” counties, those that have lost jobs since the Great Recession while also losing jobs year-over-year.
  • Micro-power: The story in North Carolina’s smaller cities also reveals disparate economic performance over the past decade and in the past year. Some micropolitan areas, like Oxford and Boone, have demonstrated strong economic growth over the past decade, and in the past year. They have added jobs to their regions by a rate of 24 and 17 percent respectively since 2007. These two northern N.C. micros also have maintained consistently lower unemployment rates than the state average over the past two years. This is remarkable, given they do not appear to be explicitly buoyed by major metropolitan economies. Regional neighbors Henderson and North Wilkesboro do not share the same kind of economic prosperity. Both micropolitan areas, while sharing local characteristics with Oxford and Boone, have lost jobs since the start of the Great Recession and year-over-year.

 

NC Budget and Tax Center

Tax cuts have pitted capital needs against education, health, other vital services

North Carolina’s budgeting mechanism for servicing debt, paying to repair state property, and investing in new capital projects will change on July 1 with the implementation of the State Capital and Investment Fund (SCIF). Given that North Carolina has been underfunding repairs, renovations, and new capital projects for years, creating a pot of funds to address these needs that is separated from the rest of the General Fund does make a certain amount of sense.

The challenge, however, is that years of tax cuts have squeezed our ability to fund the needs of a growing state, so setting funds aside for capital projects at the outset of the budgeting process will create even fewer resources in other areas of the budget. The result is that our state is facing a growing gap between the revenue we need to keep up with providing basic services and with maintaining and building infrastructure to serve North Carolinians and the revenue that we collect.  This will only get worse in future years as the tax cuts continue to reduce revenue annually by at least $3.6 billion from what would have been collected under the tax code before the tax cuts began in 2013.

The SCIF creates a new dedicated pot of funds for these capital needs that is taken out of the General Fund before other appropriation decisions are made. The SCIF is funded statutorily with 4 percent of general fund revenues (projected to exceed $950 million for 2019-20 fiscal year), and 25 percent of the unreserved fund balance ($237.5 million in the upcoming fiscal year). Those funds will first be used to make $721 million in debt payments, with another $250 million devoted to repairing existing state facilities, and just north of $200 million for new capital projects.

Creating the SCIF has some merit as capital improvements and repairs are often the first things to get cut when budget writers don’t have enough revenue to go around, but a few bits of context are still important.

First, the scope of North Carolina’s capital needs far exceeds what the SCIF can meet in its current arrangement. North Carolina’s schools alone have over $8 billion in facility improvement needs, and that is only one area of capital needs that have been underfunded for years. Building and maintaining quality public facilities doesn’t come cheap, and the SCIF simply won’t generate enough funding to deliver what North Carolinians deserve.

Second, by setting aside debt and capital funds before the rest of the budgeting process takes place will make it even harder to meet all of the other needs of a growing state. While budget writers were in committee discussing the House’s proposal, thousands of educators were just outside demanding more funding for supplies, school nurses, teaching assistants, and a range of other vital educational needs that have gone wanting in recent years. And across areas of health, housing, and environment, documented needs for investments that would protect the public good have gone unfunded.

All of these challenges are rooted in years of decisions to give wealthy individuals and big corporations billions a year in tax cuts. Just this year alone, a scheduled reduction in the Corporate and Personal Income Tax rates drained another $900 million from the state’s coffers, funds that would have more than covered our existing debt payments without diverting support for everything else.

A final important note: At a time when revenue is already reduced, the move to solely propose funding capital projects through available revenue rather than looking to the potential for a state bond to take advantage of low interest rates is concerning.

As noted by some legislative leaders, this appears rooted more in fears of debt than in a practical consideration of what financing mechanisms would best allow the state to achieve its full set of priorities for our families and communities.

In the end, the SCIF is a cautionary tale. After years of lavishing tax cuts on the most prosperous North Carolinians, the legislature has backed itself into a corner where the only way to start addressing the need to repair existing facilities and build new ones is to take even more funding away from other services that are needed today.