Pardon Our Dust
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As of Thursday morning, in the state of North Carolina, there were 3,651 confirmed cases of COVID-19, 47,809 tests completed, 391 hospitalizations, 65 deaths and 91 of the state’s 100 counties have seen confirmed COVID-19 cases. Thursday, Governor Cooper signed EO 131 that, among other things, limits the number of shoppers inside stores.
We know there is a great deal of information out there right now, and it can be a lot to keep up with. To track all of the latest news here in North Carolina, follow the Raleigh McGuireWoods Consulting office twitter, @KeepnUpWJonesSt, for regular, real-time updates from members of our team.
Continuity of State Operations
The House Select Committee on COVID-19, Continuity of State Operations Working Group met earlier this week to hear from the Office of State Budget and Management (OSBM), the Department of Transportation (DOT), the NC Department of Justice (DOJ), the State Board of Elections (BOE), and the State Employees Association of North Carolina (SEANC).
State Budget Director Charlie Perusse updated members on the economic toll COVID-19 will have on the state. The state has been working with a budget balance of $2.25 billion which is expected to dwindle due to the pandemic. North Carolina is expected to get $4 billion through the COVID-19 federal relief package, but the distribution guidelines of those funds have not yet been announced. OSBM predicts that state unemployment could reach between 10-12%, and lawmakers should expect a sharp decline in revenue due to the deadline extension of tax filing, along with a decrease in taxable revenue. Perusse told the group that Gov. Cooper is currently working on a state funding package to address state agency needs.
NCDOT Secretary Eric Boyette followed up by discussing the operation changes that the Department has had to make in response to COVID-19. NCDOT has placed many of their employees on tele-work status as needed. All active highway projects are expected to continue with additional flexibility given to contractors to ensure safe working conditions. Secretary Boyette noted that ridership across the state has dropped 62%, and the Turnpike Authority has seen daily transactions cut in half. The Department is projecting a $200 million loss in the final quarter with fears that they may drop below their cash floor before the end of this fiscal year. Additionally, Secretary Boyette asked the group to consider delaying the mandated October 1 move of DMV headquarters to Rocky Mount in order to relieve the extra burden.
Chief Justice Cheri Beasley and McKinnely Wooten, Director of Courts gave the Judicial branch update on their response to the COVID-19 pandemic. Chief Justice Beasley has issued a number of orders to help combat the spread of COVID-19 in courthouses around the state. Courthouses continue to operate consistent with social distancing guidelines as judges hear cases essential to the safety of the public. Court employees have moved to tele-work where possible, but the face-to-face nature of the judicial system has presented challenges. The Chief Justice and Director of Courts explained to the group that matters such as domestic violence and emergency cases will continue to be heard, while most misdemeanor cases have been appropriately delayed. Judges around the state will continue to have flexibility in their discretion to hear cases, but Chief Justice Beasley urged the group to give more thought into appropriations for the E-Courts program to ensure a paperless backup plan for future statewide situations. The Chief Justice also requested legislation to remove the statue that caps the limit on how many emergency judges can be utilized. The courts expect a significant backlog of cases as the pandemic continues.
State Board of Elections Executive Director Karen Brinson Bell presented the group with the immediate and future impacts COVID-19 presents to the elections process. Most county election boards have closed and have set up secure drop boxes in order to continue processing essential documents. The board has explored various options for upcoming elections, including moving to all mail-in ballots, re-purposing old, large commercial real estate properties such as grocery stores to adhere to social distancing guidelines, and replacing appointed officials at precincts with high speed ballot scanners. Election officials remain hopeful that the pandemic will pass, but are prepared to shift the way North Carolinians vote while maintaining voter integrity. The BOE made a number of legislative requests, including making Election Day a holiday, increasing poll worker pay, expanding flexibility in conducting one-stop early voting, pre-paid postage for returned absentee ballots, and establishing an online portal for absentee request.
Finally, Ardis Watkins, Executive Director of SEANC spoke briefly to the group on the importance of state employees during the crisis. Watkins told committee members that the group recommends a clean appropriations bill in order to ensure hazard pay and additional supplies to prisons, hospitals, and the Department of Health and Human Services. SEANC also requested that all non-essential employees be sent home with emergency pay. The group hopes to put out draft legislation before the General Assembly reconvenes for short session.
Economic Support Working Group
The Economic Support Working Group met Tuesday, April 7. The group heard presentations on federal programs enacted by the CARES ACT, an update on unemployment benefits, COVID-19 industry impacts, and multiple bill drafts.
As of that morning, the Division of Employment Security had received about 450,402 claims over the last three weeks, with an average of about 21,000 claims per day. The system has been so overwhelmed by the volume of claims that the division has been working to set up additional cloud-based platforms and hiring additional workers to staff the call centers. It is expected that those who have filed claims will receive an additional $600 in federal unemployment benefits starting next week. The National Federation of Independent Business and the NC Chamber of Commerce expressed to the group that while businesses are doing what they can with federal government assistance, the state will still play a major role in their revitalization.
Finally, the committee reviewed the following draft bills:
COVID-19 UI Response Act- draft
This bill would allow flexibility in determining who qualifies as unemployed, work search requirements, and the waiting period for claimants. This bill would allow employers the ability to file claims on behalf of their employees. In addition, this would provide a tax credit to employers equal to their current quarter contributions due. It would include a second quarter credit for employers who already paid for the first quarter.
UI Laws Technical, Clarifying, and Administrative Changes- draft
This bill would allow employers to file attached claims when there is a federally declared emergency. It would allow individuals to meet the work search requirement through attending a workshop, such as attending a meeting on how to write a resume. It also would clarify that lien or county property taxes do not take priority over a previous lien taken out.
COVID-19 Interest Waiver Response-draft
This bill draft would waive interest and payments for corporate, franchise, and individual income taxes. In addition to no penalty for filing late, there would also be no interest applied through July 15. Any interest would accrue after that July 15 date. This would also apply to first quarter tax payments.
Health Care Working Group
The Health Care Working Group listened to the impact of COVID-19 on child care providers, the aging population and services, and McDowell County EMS/First Responders. As healthcare takes center stage during this crisis, the working group has been tasked to take into consideration every sector and service essential to a healthy North Carolina. Childcare centers have faced hardship during this time as many parents find themselves out of work or working from home. Providers are asking for help to cover payroll, co-pay fees, providing second-shift and 24-hour care options, as well as bonus pay. While they do not have an exact number on suggested adequate funding, it is estimated that $125 million in state funding will need to be appropriated.
Facilities and services for older adults have been significantly impacted by COVID-19. Older adults, especially those with pre-existing conditions, fall into the high-risk category of contracting COVID-19. Facilities are facing difficulty in how to provide adequate care for their population while facing a shortage of personal protective equipment that is needed by both healthcare and social workers entering facilities. The aging population in facilities also faces concerns over increased reports of fraudulent activities, access to executing documents such as wills and powers of attorney, and the ability to vote in the upcoming election.
The group hopes to have two bills come out of the committee-one pertaining to funding needs and another that will cover regulatory and policy-related needs. The committee plans to discuss the draft bills during their upcoming April 23 meeting.
Education Working Group
The Education Working Group met April 9 to discuss graduation and testing requirements, statutes related to Educator Preparation Programs (EPPs), and to review statutes related to licensure and evaluations. The group co-chairs submitted various recommendations on each topic to the Legislative Analysis Division that were compiled in the above charts. Recommendations include waiving the graduation requirement for the completion of CPR instruction for the 19-20 school year, waiving the minimum GPA and clinical internship requirements for those in EPPs, not placing schools into the Innovative School District based on their 19-20 scores, extending teacher licensing renewal dates, waiving federally- required testing, canceling summer reading camps, and giving flexibility to principal pay/bonuses.
The group plans to finalize draft legislation within the next two weeks.
NCWorks Commission
The NCWorks Commission recommends policies and strategies that ensure North Carolina has an innovative, effective, and efficient workforce development system. The group is made up of private and public sector partners who make recommendations to the Department of Commerce, General Assembly, and Governor on relevant workforce needs to the state. The executive committee of the Commission held a conference call this week to discuss updates on the status of unemployment insurance and the next public meeting. Jessica Englert, Assistant Secretary for Workforce Solutions, briefly explained to members that the state has been walloped by unemployment insurance claims. The system was designed to take in about 3,000 claims per week, but the Department has seen an average of 21,000 claims per day. They have shifted to a completely virtual system and have had to transition 100 employees from other divisions to help handle claims. Englert told the commission that they have not yet seen claims level out, and that they face difficulties in keeping their backlog low and productivity steady. The committee will hold a virtual town hall style meeting May 13.