North Carolina General Assembly Week in Review

June 4, 2010

Pardon Our Dust

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The General Assembly is set to begin final negotiations on the 2010 budget after the House approved its version of the spending package in the early hours of Friday morning.  Before the pivotal 63-49 vote occurred, House legislators considered over 30 amendments throughout a debate that lasted nearly seven hours on Thursday.  While conferees from the House and Senate will meet next week to iron out differences in the legislation approved by each chamber, but public dialogue continues.  Democrats labeled the proposal as an austere plan for 2010, while Republicans counter that it leaves the state unprepared for a $3 billion shortfall in 2011.  Budget conferees are aiming to produce a final, General Assembly budget proposal that can be presented to Gov. Beverly Purdue by June 30.
Among other issues that must be worked out by budget conferees will be North Carolina’s obligations under the Federal Medical Assistance Percentages (FMAPs), which are used to determine the amount of Federal matching funds for State expenditures for assistance payments for certain social services, and State medical and medical insurance expenditures.  The budget proposals approved in both chambers are banking on $490 million from Congress to extend a more generous formula from Medicaid for six more months through June 2011, even though the U.S. House approved a measure that leaves out the additional combined $24 billion that would have been available to states. The $490 million represents North Carolina’s share.  House Appropriations Committee Chairman Mickey Michaux (D-Durham) said House and Senate Democrats would delete that Medicaid funding if there’s no clarity from Capitol Hill on the future of that money. The budget would then have to be rebalanced with “a few more drastic cuts,” Michaux told colleagues.  Conferees will also address notable differences in the education and health and human services budgets approved by the House and Senate.
Also this week, the Senate Finance Committee gave its support to a $451 million borrowing plan to help finance the improvement and expansion of engineering schools at the state’s public universities.  Besides the engineering school construction, the plan would put $150 million toward general state building repairs and $55 million into university and community college equipment.  Children of state employees, teachers and retirees can stay on their parents’ health insurance until the age of 26 under legislation approved Wednesday by the Senate. If Gov. Perdue signs the bill into law, the young adults can keep their health coverage between now and later this year, when their coverage will be required by the federal health insurance overhaul law.
The legislative calendar for the remainder of the 2010 Short Session will likely mirror the progress made by the General Assembly’s leadership and negotiators.  As previously noted, negotiators want to get a final budget to Gov. Perdue by June 30.