GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 2005

S                                                                                                                                                     4

SENATE BILL 622

Appropriations/Base Budget Committee Substitute Adopted 5/3/05

Pensions & Retirement and Aging Committee Substitute Adopted 5/3/05
Fourth Edition Engrossed 5/5/05

 

 

 

Short Title:     2005 Appropriations Act.

(Public)

Sponsors:

 

Referred to:

 

March 17, 2005

 

A BILL TO BE ENTITLED

AN ACT TO MAKE BASE BUDGET APPROPRIATIONS FOR CURRENT OPERATIONS OF STATE DEPARTMENTS, INSTITUTIONS, AND AGENCIES, AND FOR OTHER PURPOSES.

 

The General Assembly of North Carolina enacts:

 

PART i. INtroduction and title of act

 

Requested by:            Senators Garrou, Dalton, Hagan

INTRODUCTION

SECTION 1.1.  The appropriations made in this act are for maximum amounts necessary to provide the services and accomplish the purposes described in the budget in accordance with the Executive Budget Act.  Savings shall be effected where the total amounts appropriated are not required to perform these services and accomplish these purposes and the savings shall revert to the appropriate fund at the end of each fiscal year, except as otherwise provided by law.

 

Requested by:            Senators Garrou, Dalton, Hagan

title of act

SECTION 1.2.  This act shall be known as the "Current Operations and Capital Improvements Appropriations Act of 2005."

 

PART iI. current operations and expansion/general fund

 

CURRENT OPERATIONS AND EXPANSION/GENERAL FUND

SECTION 2.1.  Appropriations from the General Fund of the State for the maintenance of the State departments, institutions, and agencies, and for other purposes as enumerated, are made for the biennium ending June 30, 2007, according to the following schedule:

 

Current Operations - General Fund                                  2005-2006             2006-2007

 

EDUCATION

 

Community Colleges System Office                                $  792,784,715       $  746,844,357

 

Department of Public Instruction                                      6,686,828,445        6,706,732,097

 

University of North Carolina - Board of Governors                                                                 

      Appalachian State University                                             97,985,189             98,017,482

      East Carolina University                                                                                                         

            Academic Affairs                                                        163,117,460           165,825,346

            Health Affairs                                                                45,936,835             45,899,318

      Elizabeth City State University                                          27,836,223             27,945,857

      Fayetteville State University                                              42,457,022             42,888,221

      North Carolina Agricultural and

            Technical State University                                           76,760,995             77,033,079

      North Carolina Central University                                    58,670,213             58,651,761

      North Carolina School of the Arts                                    19,903,778             19,887,953

      North Carolina State University

            Academic Affairs                                                        298,649,068           303,604,023

            Agricultural Extension                                                  35,806,488             35,806,688

            Agricultural Research                                                   45,270,285             45,549,731

      University of North Carolina at Asheville                        28,616,607             29,645,303

      University of North Carolina at Chapel Hill

            Academic Affairs                                                        212,811,809           221,386,937

            Health Affairs                                                              163,536,496           165,717,793

            Area Health Education Centers                                    44,519,506             44,519,506

      University of North Carolina at Charlotte                      125,946,379           132,426,616

      University of North Carolina at Greensboro                  112,494,664           113,358,313

      University of North Carolina at Pembroke                       40,978,831             41,646,390

      University of North Carolina at Wilmington                    74,233,617             76,212,723

      Western Carolina University                                             71,221,796             71,938,286

      Winston-Salem State University                                       48,827,490             48,923,209

      General Administration                                                      47,357,834             47,356,334

      University Institutional Programs                                     24,285,466             28,270,466

      Related Educational Programs                                        112,128,293           113,991,033

      North Carolina School of Science and Mathematics       13,840,377             13,840,377

      UNC Hospitals at Chapel Hill                                            39,231,482             39,231,482

Total University of North Carolina -

      Board of Governors                                                       2,072,424,203        2,109,574,227

 

HEALTH AND HUMAN SERVICES                                                                                          

Department of Health and Human Services

      Office of the Secretary                                                    114,180,919           130,744,045

      Division of Aging                                                                29,495,139             29,495,139

      Division of Blind Services/Deaf/HH                                   9,636,797               9,681,220

      Division of  Child Development                                      264,750,017           267,356,799

      Division of Education Services                                         33,852,267             34,281,895

      Division of Facility Services                                             16,045,403             17,795,105

      Division of Medical Assistance                                   2,461,281,279        2,606,201,525

      Division of Mental Health                                               600,373,655           602,298,655

      NC Health Choice                                                               76,706,650             97,511,380

      Division of Public Health                                                139,796,232           141,314,496

      Division of Social Services                                             185,339,061           186,973,442

      Division of Vocation Rehabilitation                                 41,755,526             42,142,193

Total Health and Human Services                                  $  3,973,212,945   $  4,165,795,894

 

NATURAL AND ECONOMIC RESOURCES                                                                        

                 

Department of Agriculture and Consumer Services              49,829,113             49,456,901

 

Department of Commerce

      Commerce                                                                           44,407,935             36,759,201

      Commerce State-Aid                                                          11,222,085             11,222,085

      NC Biotechnology Center                                                  12,083,395             10,583,395

      Rural Economic Development Center                              24,802,607             24,802,607

                 

Department of Environment and Natural Resources           171,187,401           163,712,105

 

Department of Labor                                                                14,154,785             14,169,511

                 

JUSTICE AND PUBLIC SAFETY

                 

Department of Correction                                              $  1,023,193,451   $  1,041,825,169

                 

Department of Crime Control and Public Safety                   33,509,206             33,899,206

                 

Judicial Department                                                                338,914,267           341,627,255

Judicial Department - Indigent Defense                                 90,879,188             85,879,188

                 

Department of Justice                                                              76,555,200             77,190,756

                 

Department of Juvenile Justice and

            Delinquency Prevention                                             135,174,503           135,774,503

                 

GENERAL GOVERNMENT

                 

Department of Administration                                                 62,419,016             58,783,228

                 

Office of Administrative Hearings                                            2,987,410               2,969,712

                 

Department of State Auditor                                                    10,850,737             10,840,918

                 

Office of State Controller                                                        10,043,268             10,044,511

                 

Department of Cultural Resources                                                                                              

      Cultural Resources                                                             63,541,449             61,950,582

      Roanoke Island Commission                                                1,783,374               1,783,374

                 

State Board of Elections                                                             5,067,543               5,069,307

                 

General Assembly                                                                     42,984,588             46,965,432

                 

Office of the Governor                                                                                                                 

      Office of the Governor                                                         5,324,590               5,344,528

      Office of State Budget and Management                            5,019,735               5,021,795

      OSBM - Reserve for Special Appropriations                    4,430,000               4,180,000

      Housing Finance Agency                                                      5,750,945               4,750,945

                 

Department of Insurance                                                                                                              

      Insurance                                                                              28,088,214             28,110,582

      Insurance - Volunteer Safety Workers'

            Compensation                                                                  2,500,000               4,500,000

                 

Office of Lieutenant Governor                                                     754,737                   753,037

                 

Department of Revenue                                                            78,238,895             77,858,775

                 

Department of Secretary of State                                              8,657,943               8,638,857

                 

Department of State Treasurer                                                                    

      State Treasurer                                                                       8,690,595               8,295,843

      State Treasurer - Retirement for Fire and Rescue

            Squad Workers                                                                8,551,457               8,551,457

                 

TRANSPORTATION                                                                                                                     

Department of Transportation                                                                   0                               0

                 

RESERVES, ADJUSTMENTS AND DEBT SERVICE                                                            

Reserve for Compensation Increases                                   192,876,000           499,876,000

                 

Salary Adjustment Fund:  2005-2007 Biennium                      4,500,000               4,500,000

                 

Salary Adjustment Fund:  2004-2005 Fiscal Year                   4,500,000               4,500,000

                 

Reserve for Teachers' and State Employees'

      Retirement Contribution                                                    14,617,000             14,617,000

                 

Reserve for Retirement System Payback                               25,000,000                               0

                 

Reserve for Death Benefit Trust                                              12,899,200             12,899,200

                 

Reserve for Disability Income Plan                                          6,586,500               6,586,500

                 

Reserve for State Health Plan                                                117,300,000           156,500,000

                 

Contingency and Emergency Fund                                             5,000,000               5,000,000

                 

Reserve for Information Technology

      Rate Adjustments                                                                 (2,300,000)            (2,300,000)

                 

Information Technology Fund                                                  24,375,000               8,025,000

                 

MH/DD/SAS Trust Fund                                                             5,000,000                               0

                 

Health and Wellness Trust Fund                                              10,000,000                               0

                 

Reserve for Job Development Investment Grants (JDIG)       8,000,000             12,400,000

                 

Reserve for Healthy NC                                                             2,000,000                               0

                 

Reserve for Increased Fuel Costs                                              3,000,000                               0

                 

Debt Service                                                                                                                                  

      General Debt Service                                                       489,544,211           619,291,140

      Federal Reimbursement                                                        1,616,380               1,616,380

 

TOTAL CURRENT OPERATIONS -

      GENERAL FUND                                                  $ 16,831,362,231 $ 17,453,772,560

 

Requested by:            Senators Garrou, Dalton, Hagan

GENERAL FUND AVAILABILITY STATEMENT

SECTION 2.2.(a)  The General Fund availability used in developing the 2005-2007 biennial budget is shown below:

                                                                                                FY 2005-2006       FY 2006-2007

 

Unappropriated Balance Remaining

      from Previous Year                                                      $                      0        $ 240,751,821

Projected Over Collections FY 2004-2005                        428,400,000                               0

Projected Reversions FY 2004-2005                                     75,000,000                               0

Less Earmarkings of Year End Credit Balance                                        0                               0

      Savings Reserve Account                                                (125,850,000)                             0

      Repairs and Renovations                                                   (50,000,000)                             0

Beginning Unreserved Credit Balance                       $  327,550,000       $  240,751,821

 

Revenues Based on Existing Tax Structure            $ 15,250,100,000 $ 15,903,000,000

 

Nontax Revenues                                                                                                                         

      Investment Income                                                              75,300,000             78,500,000

      Judicial Fees                                                                      142,200,000           147,900,000

      Disproportionate Share                                                    100,000,000           100,000,000

      Insurance                                                                              56,600,000             58,800,000

      Other Nontax Revenues                                                    150,400,000           161,800,000

      Highway Trust Fund/Use Tax Reimbursement

            Transfer                                                                        252,558,117           252,663,009

      Highway Fund Transfer                                                       16,200,000             16,200,000

            Subtotal Nontax Revenues                                      793,258,117           815,863,009

           

Total General Fund Availability                             $  16,370,908,117 $ 16,966,585,499

           

Adjustments to Availability:  2005 Session                                                                          

      Streamlined Sales Tax Changes                                         72,200,000             87,800,000

      Maintain 4.5% Sales Tax Rate                                         413,400,000           458,700,000

      Other Sales Tax Changes                                                                                                        

            Apply Sales Tax to Service Contracts and

                  Warranties                                                                  9,100,000             16,800,000

            Apply Sales Tax to Candy                                             11,000,000             15,800,000

            Exempt Potting Soil for Farmers                                    (200,000)                (300,000)

      Tobacco Tax Rate Changes                                              201,300,000           229,900,000

      Reduce Highest Marginal Individual

            Income Tax Rate to 7.75% Over Two Years               20,100,000             24,600,000

      Continue Use Tax Line on Individual Returns                    3,200,000               3,200,000

      Conform Estate Tax to Federal Sunset                              30,700,000           121,600,000

      Reduce Corporate Income Tax Rate                                                   0                               0

      Corporate Tax "Throwout" Rule                                           9,800,000             10,300,000

      Film Industry Jobs Incentives                                             (4,800,000)            (4,800,000)

      IRC Update - Partial Conformance                                   (8,000,000)          (10,700,000)

      Increase Earmarking for NC Grape Growers Council         (150,000)                (150,000)

      Justice and Public Safety Fees                                           20,428,271             20,428,271

      Transfer from Tobacco Trust Fund                                    34,000,000             30,000,000

      Transfers from Special Revenue and Other Funds             8,953,950                               0

 

Reimburse Debt Service for Certain Capital Facilities

      and Land Acquisition per SL 2004-179                              5,958,723             21,060,827

Adjust Transfer from Insurance Regulatory Fund                        256,513                   243,813

Adjust Transfer from Treasurer's Office                                        68,478                     67,478

      Subtotal Adjustments to Availability:

      2005 Session                                                                $  827,315,935   $  1,024,550,389

 

Revised General Fund Availability                         $ 17,198,224,052 $ 17,984,165,219

 

Less: General Fund Appropriations                                                                                      

      SB 622 (2005 Appropriations Act )                         (16,857,472,231)  (17,453,772,560)

      G.S. 143-15.3B:  Clean Water Management

            Trust Fund                                                                  (100,000,000)        (100,000,000)

Total General Fund Appropriations 2005-2007

      Biennium                                                                ($16,957,472,231) ($17,553,772,560)

           

Unappropriated Balance Remaining                           $  240,751,821       $  430,392,659

 

SECTION 2.2.(b)  Notwithstanding G.S. 143-16.4(a2), of the funds credited to the Tobacco Trust Account from the Master Settlement Agreement pursuant to Section 6(2) of S.L. 1999-2 during the 2005-2007 fiscal biennium, the sum of thirty-four million dollars ($34,000,000) for the 2005-2006 fiscal year and the sum of thirty million dollars ($30,000,000) for the 2006-2007 fiscal year shall be transferred from the Department of Agriculture and Consumer Services, Budget Code 23703 (Tobacco Trust Fund) to the State Controller to be deposited in Nontax Budget Code 19978 (Intrastate Transfers) to support General Fund appropriations for the 2005-2006 and 2006-2007 fiscal years.

SECTION 2.2.(c)  G.S. 143-15.3 is amended by adding a new subsection to read:

"(a2)    The transfer of funds to the Savings Reserve Account in accordance with this section or any other provision of law is not an "appropriation made by law", as that phrase is used in Article V, Section 7(1) of the North Carolina Constitution."

This subsection becomes effective June 30, 2005.

SECTION 2.2.(d)  Notwithstanding G.S. 143-15.2 and G.S. 143-15.3A, the State Controller shall transfer fifty million dollars ($50,000,000) from the unreserved credit balance to the Repairs and Renovations Reserve Account on June 30, 2005. Funds transferred under this section to the Repairs and Renovations Reserve Account are appropriated for the 2005-2006 fiscal year to be used in accordance with G.S. 143-15.3A.  This subsection becomes effective June 30, 2005.

SECTION 2.2.(e)  When the Highway Trust Fund was created in 1989, the revenue from the sales tax on motor vehicles was transferred from the General Fund to the Highway Trust Fund.  To offset this loss of revenue from the General Fund, the Highway Trust Fund was required to transfer one hundred seventy million dollars ($170,000,000) to the General Fund each year, an amount equal to the revenue in 1989 from the sales tax on motor vehicles.  This transfer did not, however, make the General Fund whole after the transfer of the sales tax revenue because no provision has been made to adjust the amount for the increased volume of transactions and increased vehicle prices.  The additional eighty million dollars ($80,000,000) transferred from the Highway Trust Fund to the General Fund by this act is an effort to recover a portion of the sales tax revenues that would have gone to the General Fund over the last 16 years.

SECTION 2.2.(f)  Notwithstanding G.S. 105-187.9(b)(1), the sum to be transferred under that subdivision for the 2005-2006 fiscal year and for the 2006-2007 fiscal year is two hundred fifty million dollars ($250,000,000).

SECTION 2.2.(g)  Section 2.2(g) of S.L. 2002-126 is repealed.

SECTION 2.2.(h)  Notwithstanding any other provision of law to the contrary, effective July 1, 2005, cash balances remaining in special funds on June 30, 2005, shall be transferred to the State Controller to be deposited in Nontax Budget Code 19978 (Intrastate Transfers) according to the schedule that follows.  These funds shall be used to support General Fund appropriations for the 2005-2006 fiscal year.

 

Fund                                                                                                           Amount Transferred

Department of Environment and Natural Resources

Budget Code 24300, Fund Code 2338 (DAQ-Inspections

       and Maintenance - Air Pollution)                                                              $     300,000

Budget Code 24300, Fund Code 2106 (DEH - Sleep Products)                          200,000

Budget Code 24300, Fund Code 2735 (DLR - Sedimentation Fees)                  200,000

Budget Code 24306, Fund Code 2127 (DWQ - Clean-Up Dry

      Cleaning Solvent)                                                                                             3,000,000

Budget Code 24300, Fund Code 2130 (DWQ - Well Construction Fund)         100,000

Budget Code 24300, Fund Code 2335 (DWQ - Lab Certification Fees)            100,000

Budget Code 24300, Fund Code 2341 (DWQ - Water Permits)                         500,000

Budget Code 64306, Fund Code 6341 (DWQ - WW Treatment

      Maintenance and Repair)                                                                                    100,000

Budget Code 24304, Fund Code 2982 (DWQ - Riparian Buffer

      Restoration)                                                                                                      2,000,000

 

Department of Commerce

Budget Code 24600, Fund Code 2711 (Industrial Development Fund)               500,000

 

Department of Corrections

Budget Code 24502, (Inmate Canteen/Welfare Fund)                                          440,000

 

Judicial Department

Budget Code 22005, Fund Code 2263 (Worthless Check Fund)                         100,000

 

Department of Administration

Budget Code 24160, Fund Code 2000 (NC Flex)                                                  913,950

 

SECTION 2.2.(i)  The transfer of cash from Department of Correction, Budget Code 74500, Fund Code 7100 (Prison Enterprises) to Nontax Budget Code 19978 (Intrastate Transfers) shall be increased by five hundred thousand dollars ($500,000), effective July 1, 2005, for the 2005-2006 fiscal year.

 

PART iII. current operations and expansion/highway fund

 

Requested by:            Senators Jenkins, Garrou, Dalton, Hagan

current operations and expansion/highway fund

SECTION 3.1.  Appropriations from the State Highway Fund for the maintenance and operation of the Department of Transportation and for other purposes as enumerated, are made for the biennium ending June 30, 2007, according to the following schedule:

 

Current Operations - Highway Fund                               2005-2006              2006-2007

 

Department of Transportation

      Administration                                                              $     93,888,317        $   95,100,980

 

Division of Highways

      Administration                                                                     30,621,612             30,632,164

      Construction                                                                      140,470,000           143,080,000

      Maintenance                                                                      715,895,029           665,722,211

      Planning and Research                                                          4,280,000               4,280,000

      OSHA Program                                                                         425,000                   425,000

 

Ferry Operations                                                                       21,264,811             21,264,811

 

State Aid

      Municipalities                                                                     93,370,000             95,980,000

      Public Transportation                                                         66,466,447             89,866,447

      Railroads                                                                              16,531,153             15,531,153

 

Governor's Highway Safety                                                           293,118                   293,118

 

Division of Motor Vehicles                                                     95,447,914             95,268,137

 

Other State Agencies                                                              237,392,745           230,530,729

 

Reserves and Transfers                                                             20,428,052             36,438,052

 

TOTAL                                                                              $ 1,536,774,198    $ 1,524,412,802

 

Requested by:            Senators Jenkins, Garrou, Dalton, Hagan

highway fund availability statement

SECTION 3.2.  The Highway Fund availability used in developing the 2005-2007 biennial budget is shown below:

 

Highway Fund Availability Statement                              2005-2006               2006-2007

 

Beginning Credit Balance                                                                          -                                 -

Estimated Revenue                                                         $ 1,631,640,000      $ 1,661,240,000

Estimated Reversions                                                                                -                                 -

 

Total Highway Fund Availability                             $ 1,631,640,000      $ 1,661,240,000

 

PART iv. highway trust fund appropriations

 

Requested by:            Senators Jenkins, Garrou, Dalton, Hagan

highway trust fund appropriations

SECTION 4.1.  Appropriations from the State Highway Trust Fund for the maintenance and operation of the Department of Transportation and for other purposes as enumerated, are made for the biennium ending June 30, 2007 according to the following schedule:

 

Current Operations - Highway Trust Fund                    2005-2006              2006-2007

 

Intrastate System                                                                  $469,925,196         $486,590,730

Urban Loops                                                                            190,018,179           196,757,026

Aid to Municipalities                                                                49,306,114             51,054,717

Secondary Roads                                                                       86,596,114             89,274,717

Program Administration                                                           41,156,280             42,259,800

Transfer to General Fund                                                       252,558,117           252,663,009

 

GRAND TOTAL CURRENT OPERATIONS

      AND EXPANSION                                                    $1,089,560,000     $1,118,600,000

 

PART V. BLOCK GRANTS

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

DHHS Block Grants

SECTION 5.1.(a)  Appropriations from federal block grant funds are made for the fiscal year ending June 30, 2006, according to the following schedule:

 

COMMUNITY SERVICES BLOCK GRANT

 

01.       Community Action Agencies                                                      $ 15,071,666

 

02.       Limited Purpose Agencies                                                                  837,315

 

03.       Department of Health and Human Services

to administer and monitor

the activities of the

Community Services Block Grant                                                      837,315

 

TOTAL COMMUNITY SERVICES BLOCK GRANT                                $ 16,746,296

 

SOCIAL SERVICES BLOCK GRANT

 

01.       County departments of social services                                      $ 28,868,189

(Transfer from TANF - $4,500,000)

 

02.       Allocation for in-home services provided

by county departments of

social services                                                                                   2,101,113

 

03.       Adult day care services                                                                     2,155,301

 

04.       Child Protective Services/CPS Investigative

            Services/Child Medical Evaluation Program                                     238,321

 

05.       Foster Care Services - CCIS                                                            1,500,000

 

06.       Division of Aging and Adult Services - Home and Community

            Care Block Grant                                                                               1,834,077

 

07.       UNC-CH CARES Program for training and

            consultation services                                                                            247,920

 

08.       Mental Health Services Program                                                        422,003

 

09.       Division of Mental Health, Developmental Disabilities, and

            Substance Abuse Services - Developmentally Disabled

            Services Program                                                                              5,000,000

 

10.       Division of Mental Health, Developmental Disabilities,

            and Substance Abuse Services                                                          3,234,601

 

11.       Division of Services for the Blind - Independent

            Living Program                                                                                  3,182,987

 

12.       Division of Vocational Rehabilitation Services -

            Easter Seals Society/UCP                                                                   188,263

 

13.       Office of the Secretary - Office of Economic

            Opportunity for N.C. Senior Citizens'

            Federation for outreach services to

low-income elderly persons                                                                  41,302

 

14.       Child Care Subsidies                                                                         3,356,063

 

15.       Division of Facility Services -

Adult Care Licensure Program                                                            411,897

 

16.       Division of Facility Services -

Mental Health Licensure                                                                     205,668

 

17.       State administration                                                                          1,706,017

 

18.       Division of Mental Health, Developmental

            Disabilities, and Substance Abuse Services -

            Administration                                                                                        18,098

 

19.       Division of Facility Services                                                                 37,204

 

20.       Office of the Secretary - NC Interagency Council

            for Coordinating Homeless Programs                                               250,000

 

21.       Department of Administration

            for the N.C. State Commission of Indian Affairs

            In-Home Services Program for the Elderly                                       203,198

 

22.       Transfer to Preventative Health Services Block

            Grant for HIV/AIDS education, counseling, and

            testing                                                                                                    145,819

 

TOTAL SOCIAL SERVICES BLOCK GRANT                                           $ 55,348,041

 

LOW-INCOME ENERGY BLOCK GRANT

 

01.       Energy Assistance Programs                                                      $ 13,208,740

 

02.       Crisis Intervention                                                                             9,592,387

 

03.       Administration                                                                                   3,186,258

                County DSS                                                       $1,930,734

                Division of Social Services                             $   300,000

                Division of Mental Health, Developmental

                Disabilities, and Substance Abuse

                   Services                                                          $       7,146

                Local Residential Energy Efficiency

                   Service Providers                                          $   353,820

                Office of the Secretary                                    $   594,558

 

04.       Weatherization Program                                                                   4,343,072

 

05.       Department of Administration -

N.C. State Commission of Indian Affairs                                             54,840

 

06.       Heating Air Repair and Replacement Program                               2,025,687

 

TOTAL LOW-INCOME ENERGY BLOCK GRANT                                 $ 32,410,984

 

MENTAL HEALTH SERVICES BLOCK GRANT

 

01.       Provision of community-based

services for severe and persistently

mentally ill adults                                                                           $ 6,983,202

 

02.       Provision of community-based

services to children                                                                           3,921,991

 

03.       Comprehensive Treatment Services

Program for Children                                                                        1,500,000

 

04.       Administration                                                                                      568,911

 

TOTAL MENTAL HEALTH SERVICES BLOCK GRANT                        $ 12,974,104

 

SUBSTANCE ABUSE PREVENTION

AND TREATMENT BLOCK GRANT

 

01.       Provision of community-based

alcohol and drug abuse services,

tuberculosis services, and services

provided by the Alcohol and Drug Abuse

Treatment Centers                                                                       $ 20,441,082

 

02.       Continuation of services for

pregnant women and women

with dependent children                                                                    8,069,524

 

03.       Continuation of services to

IV drug abusers and others at risk

for HIV diseases                                                                                4,816,378

 

04.       Child Substance Abuse Prevention                                                  5,835,701

 

05.       Provision of services to children

and adolescents                                                                                  4,940,500

 

06.       Juvenile Services - Family Focus                                                       851,156

 

07.       Allocation to the Division of Public Health

for HIV/STD Risk Reduction Projects                                               383,980

 

08.       Allocation to the Division of Public Health

for HIV/STD Prevention by County Health

Departments                                                                                          209,576

 

09.       Allocation to the Division of Public Health

for the Maternal and Child Health Hotline                                           37,779

 

10.       Administration                                                                                   2,596,307

 

TOTAL SUBSTANCE ABUSE PREVENTION

AND TREATMENT BLOCK GRANT                                                         $ 48,181,983

 

CHILD CARE AND DEVELOPMENT FUND BLOCK GRANT

 

01.       Child care subsidies                                                                   $158,708,393

 

02.       Quality and availability initiatives                                                  33,059,644

 

03.       Administrative expenses                                                                   7,163,654

 

04.       Transfer from TANF Block Grant for

child care subsidies                                                                         81,292,880

 

TOTAL CHILD CARE AND DEVELOPMENT FUND

BLOCK GRANT                                                                                           $280,224,571

 

TEMPORARY ASSISTANCE TO NEEDY FAMILIES

(TANF) BLOCK GRANT

 

01.       Work First Cash Assistance                                                      $107,794,365

 

02.       Work First County Block Grants                                                   94,653,315

 

03.       Child Protective Services -

Child Welfare Workers for local DSS                                          12,452,391

 

04.       Support Our Students - Department of

            Juvenile Justice and Delinquency

            Prevention                                                                                          2,749,642

 

05.       Family Violence Prevention                                                             1,200,000

 

06.       Work First - After-School Services for

At-Risk Children                                                                               2,249,642

 

07.       Division of Social Services -

Administration                                                                                      356,291

 

08.       Office of the Secretary -

Administration                                                                                        60,249

 

09.       Child Welfare Training                                                                     2,550,000

 

10.       Boys and Girls Clubs                                                                        1,000,000

 

11.       Work Central Career Advancement Center                                        550,000

 

12.       Special Children's Adoption Fund                                                    3,000,000

 

13.       Maternity Homes                                                                                  838,000

 

14.       After-School Programs for At-Risk Youth in

            Middle Schools                                                                                     500,000

 

15.       Teen Pregnancy Prevention Initiatives                                            2,500,000

 

16.       Subsidized Child Care Program                                                     36,601,205

 

17.       TANF Automation Projects                                                                 592,500

 

18.       NC FAST Implementation                                                                1,447,640

 

19.       Transfer to the Child Care and

            Development Fund Block Grant

            for child care subsidies                                                                  81,292,880

 

20.       Transfer to Social Services Block Grant for

            County Departments of Social Services for

            Children's Services                                                                            4,500,000

 

TOTAL TEMPORARY ASSISTANCE TO NEEDY FAMILIES

(TANF) BLOCK GRANT                                                                             $356,888,120

 

MATERNAL AND CHILD HEALTH BLOCK GRANT

 

01.       Healthy Mothers/Healthy Children

Block Grants to Aid-to-County                                                        9,359,236

 

02.       Children's Health Services Aid-to-County                                      7,364,216

 

03.       Healthy Beginnings Aid-to-County                                                     404,559

 

04.       Maternal Health Aid-to-County                                                          397,761

 

05.       Children's Health Services                                                               2,878,883

 

06.       Office of Women's Health and

            Maternal Health Activities                                                                   114,063

 

07.       State Center for Health Statistics                                                          28,874

 

08.       Local Technical Assistance & Training                                                46,866

 

09.       Injury and Violence Prevention                                                           149,438

 

10.       Office of Minority Health                                                                     99,352

 

11.       Special Supplemental Nutrition Program

            for Women, Infants and Children (WIC)                                              25,713

 

12.       Immunization Program - Vaccine Distribution                                 819,997

 

13.       Administration                                                                                      518,137

 

TOTAL MATERNAL AND CHILD

HEALTH BLOCK GRANT                                                                           $ 22,207,095

 

PREVENTIVE HEALTH SERVICES BLOCK GRANT

 

01.       Statewide Health Promotion Programs                                        $3,637,771

 

02.       Rape Crisis/Victims' Services

Program - Council for Women                                                          197,112

 

03.       Transfer from Social Services

Block Grant - HIV/AIDS education,

counseling, and testing                                                                         145,819

 

04.       Adolescent Pregnancy Prevention Coalition of NC                          150,000

 

05.       Administration and Program Support                                                 121,271

 

06.       Osteoporosis Task Force Operating Costs                                        150,000

 

TOTAL PREVENTIVE HEALTH SERVICES BLOCK GRANT                   $4,401,973

 

GENERAL PROVISIONS

SECTION 5.1.(b)  Information to Be Included in Block Grant Plans. - The Department of Health and Human Services shall submit a separate plan for each Block Grant received and administered by the Department, and each plan shall include the following:

(1)       A delineation of the proposed allocations by program or activity, including State and federal match requirements.

(2)       A delineation of the proposed State and local administrative expenditures.

(3)       An identification of all new positions to be established through the Block Grant, including permanent, temporary, and time-limited positions.

(4)       A comparison of the proposed allocations by program or activity with two prior years' program and activity budgets and two prior years' actual program or activity expenditures.

(5)       A projection of current year expenditures by program or activity.

(6)       A projection of federal Block Grant funds available, including unspent federal funds from the current and prior fiscal years.

SECTION 5.1.(c)  Changes in Federal Fund Availability. - If the Congress of the United States reduces or increases the federal fund availability for any of the Block Grants administered by the Department of Health and Human Services from the amounts appropriated in this section, the Department shall allocate the increase or decrease proportionally across the program and activity appropriations identified for that Block Grant in this section. In allocating a decrease in federal fund availability, the Department shall not eliminate the funding for a program or activity appropriated in this section. In allocating an increase in federal fund availability, the Department shall not propose funding for new programs or activities not appropriated in this section or increase administrative expenditures.

Prior to allocating the change in federal fund availability, the proposed allocation must be approved by the Office of State Budget and Management. If the Department adjusts the allocation of any Block Grant due to changes in federal fund availability, then a report shall be made to the Joint Legislative Committee on Governmental Operations, the House of Representatives Appropriations Subcommittee on Health and Human Services, the Senate Appropriations Committee on Health and Human Services, and the Fiscal Research Division.

SECTION 5.1.(d)  All changes to the budgeted allocations to the Block Grants administered by the Department of Health and Human Services that are not specifically addressed in this section shall be approved by the Office of State Budget and Management, and a report shall be submitted to the Joint Legislative Commission on Governmental Operations for review prior to implementing the changes. All changes to the budgeted allocations to the Block Grant shall be reported immediately to the House of Representatives Appropriations Subcommittee on Health and Human Services, the Senate Appropriations Committee on Health and Human Services, and the Fiscal Research Division.

SECTION 5.1.(e)  The Department of Health and Human Services shall develop a monitoring and oversight plan for all recipients, both public and private, and subrecipients of the federal Block Grant funding. The plan shall be modeled after the Department's performance contracting initiative and include the following:

(1)       Performance standards for recipients.

(2)       Financial audit standards for non-State entities equivalent to the requirements in G.S. 143-6.1 for non-State entities receiving State funds.

(3)       Means for collecting performance data from recipients.

(4)       Any other information necessary for monitoring and overseeing the use of Block Grant funding.

The Department shall provide the plan to the Fiscal Research Division by January 1, 2006.

SECTION 5.1.(f)  The Department of Health and Human Services shall report to the House of Representatives Appropriations Subcommittee on Health and Human Services, the Senate Appropriations Committee on Health and Human Services, and the Fiscal Research Division on positions funded from federal Block Grants. The report shall include the following for each Block Grant:

(1)       All State positions currently funded through the Block Grant, including permanent, temporary, and time-limited positions.

(2)       Budgeted salary and fringe benefits for each position.

(3)       Identify the percentage of Block Grant funds used to fund each position.

The report shall be submitted no later than December 1, 2005.

SOCIAL SERVICES BLOCK GRANT

SECTION 5.1.(g)  Social Services Block Grant funds appropriated to the North Carolina Inter-Agency Council for Coordinating Homeless Program are exempt from the provisions of 10A NCAC 71R.0201(3).

LOW-INCOME HOME ENERGY ASSISTANCE PROGRAM

SECTION 5.1.(h)  Additional emergency contingency funds received may be allocated for Energy Assistance Payments or Crisis Intervention Payments without prior consultation with the Joint Legislative Commission on Governmental Operations. Additional funds received shall be reported to the Joint Legislative Commission on Governmental Operations and the Fiscal Research Division upon notification of the award. The Department of Health and Human Services shall not allocate funds for any activities, including increasing administration, other than assistance payments, without prior consultation with the Joint Legislative Commission on Governmental Operations.

MENTAL HEALTH BLOCK GRANT

SECTION 5.1.(i)  The sum of one million five hundred thousand dollars ($1,500,000) appropriated in this section in the Mental Health Block Grant to the Department of Health and Human Services, Division of Mental Health, Developmental Disabilities, and Substance Abuse Services, for the 2005-2006 fiscal year, and the sum of four hundred twenty-two thousand three dollars ($422,003) appropriated in this section in the Social Services Block Grant to the Department of Health and Human Services, Division of Social Services, for the 2005-2006 fiscal year shall be used to continue a Comprehensive Treatment Services Program for Children in accordance with Section 10.25 of this act.

SECTION 5.1.(j)  The Department of Health and Human Services shall contract with the University of North Carolina at Chapel Hill for the purpose of providing psychology student stipends in the amount of fifty thousand dollars ($50,000) for the 2005-2006 fiscal year. Twenty-five thousand dollars ($25,000) of this contract shall be paid from the Mental Health Block Grant.

CHILD CARE AND DEVELOPMENT FUND BLOCK GRANT

SECTION 5.1.(k)  The sum of four hundred thousand dollars ($400,000) appropriated in this section to the Department of Health and Human Services in the Child Care and Development Fund Block Grant shall be used for the operations of the Medical Child Care Pilot.

SECTION 5.1.(l)  Payment for subsidized child care services provided with federal TANF funds shall comply with all regulations and policies issued by the Division of Child Development and School Readiness for the subsidized child care program.

SECTION 5.1.(m)  If funds appropriated through the Child Care and Development Fund Block Grant for any program cannot be obligated or spent in that program within the obligation or liquidation periods allowed by the federal grants, the Department may move funds to child care subsidies, unless otherwise prohibited by federal requirements of the grant, in order to use the federal funds fully.

TEMPORARY ASSISTANCE FOR NEEDY FAMILIES BLOCK GRANT (TANF)

SECTION 5.1.(n)  The sum of four hundred sixteen thousand five hundred forty dollars ($416,540) appropriated in this section in the TANF Block Grant to the Department of Health and Human Services, Division of Social Services, for the 2005-2006 fiscal year shall be used to support administration of TANF-funded programs.

SECTION 5.1.(o)  The sum of two million seven hundred forty-nine thousand six hundred forty-two dollars ($2,749,642) appropriated in this section in the TANF Block Grant to the Department of Health and Human Services and transferred to the Department of Juvenile Justice and Delinquency Prevention for the 2005-2006 fiscal year shall be used to support the existing Support Our Students Program and to expand the Program statewide, focusing on low-income communities in unserved areas. These funds shall not be used for administration of the Program.

SECTION 5.1.(p)  The sum of one million two hundred thousand dollars ($1,200,000) appropriated under this section in the TANF Block Grant to the Department of Health and Human Services, Division of Social Services, for the 2005-2006 fiscal year shall be used to provide domestic violence services to Work First recipients.  These funds shall be used to provide domestic violence counseling, support, and other direct services to clients.  These funds shall not be used to establish new domestic violence shelters or to facilitate lobbying efforts.  The Division of Social Services may use up to seventy-five thousand dollars ($75,000) in TANF funds to support one administrative position within the Division of Social Services to implement this subsection.

Each county department of social services and the local domestic violence shelter program serving the county shall jointly develop a plan for utilizing these funds. The plan shall include the services to be provided and the manner in which the services shall be delivered. The county plan shall be signed by the county social services director or the director's designee and the domestic violence program director or the director's designee and submitted to the Division of Social Services by December 1, 2005. The Division of Social Services, in consultation with the Council for Women, shall review the county plans and shall provide consultation and technical assistance to the departments of social services and local domestic violence shelter programs, if needed.

The Division of Social Services shall allocate these funds to county departments of social services according to the following formula:  (i) each county shall receive a base allocation of five thousand dollars ($5,000); and (ii) each county shall receive an allocation of the remaining funds based on the county's proportion of the statewide total of the Work First caseload as of July 1, 2005, and the county's proportion of the statewide total of the individuals receiving domestic violence services from programs funded by the Council for Women as of July 1, 2005. The Division of Social Services may reallocate unspent funds to counties that submit a written request for additional funds.

The Department of Health and Human Services shall report on the uses of these funds no later than March 1, 2006, to the House of Representatives Appropriations Subcommittee on Health and Human Services, the Senate Appropriations Committee on Health and Human Services, and the Fiscal Research Division.

SECTION 5.1.(q)  The sum of two million two hundred forty-nine thousand six hundred forty-two dollars ($2,249,642) appropriated in this section in the TANF Block Grant to the Department of Health and Human Services, Division of Social Services, shall be used to expand after-school programs and services for at-risk children. The Department shall develop and implement a grant program to award grants to community-based programs that demonstrate the ability to reach children at risk of teen pregnancy and school dropout. The Department shall award grants to community-based organizations that demonstrate the ability to develop and implement linkages with local departments of social services, area mental health programs, schools, and other human services programs in order to provide support services and assistance to the child and family. These funds may be used to fund one position within the Division of Social Services to coordinate at-risk after-school programs and shall not be used for other State administration. The Department shall report no later than March 1, 2006, on its progress in complying with this section to the House of Representatives Appropriations Subcommittee on Health and Human Services, the Senate Committee on Health and Human Services, and the Fiscal Research Division.

SECTION 5.1.(r)  The sum of twelve million four hundred fifty-two thousand three hundred ninety-one dollars ($12,452,391) appropriated in this section to the Department of Health and Human Services, Division of Social Services, in the TANF Block Grant for the 2005-2006 fiscal year for Child Welfare Improvements, shall be allocated to the county departments of social services for hiring or contracting staff to investigate and provide services in Child Protective Services cases; to provide foster care and support services; to recruit, train, license, and support prospective foster and adoptive families; and to provide interstate and post-adoption services for eligible families.

SECTION 5.1.(s)  The sum of two million five hundred fifty thousand dollars ($2,550,000) appropriated in this section in the TANF Block Grant to the Department of Health and Human Services, Division of Social Services, for fiscal year 2005-2006 shall be used to support various child welfare training projects as follows:

(1)       Provide a regional training center in southeastern North Carolina.

(2)       Support the Masters Degree in Social Work/Baccalaureate Degree in Social Work Collaborative.

(3)       Provide training for residential child care facilities.

(4)       Provide for various other child welfare training initiatives.

SECTION 5.1.(t)  The sum of eight hundred thirty-eight thousand dollars ($838,000) appropriated in this section in the TANF Block Grant to the Department of Health and Human Services shall be used to purchase services at maternity homes throughout the State.

SECTION 5.1.(u)  The sum of three million dollars ($3,000,000) appropriated in this section in the TANF Block Grant to the Department of Health and Human Services, Special Children Adoption Fund, for the 2005-2006 fiscal year shall be used to implement this subsection. The Division of Social Services, in consultation with the North Carolina Association of County Directors of Social Services and representatives of licensed private adoption agencies, shall develop guidelines for the awarding of funds to licensed public and private adoption agencies upon the adoption of children described in G.S. 108A-50 and in foster care. Payments received from the Special Children Adoption Fund by participating agencies shall be used exclusively to enhance the adoption services program. No local match shall be required as a condition for receipt of these funds.

SECTION 5.1.(v)  The sum of one million five hundred thousand dollars ($1,500,000) appropriated in this section in the TANF Block Grant and transferred to the Social Services Block Grant to the Department of Health and Human Services, Division of Social Services, for child caring agencies for the 2005-2006 fiscal year shall be allocated to the State Private Child Caring Agencies Fund.

SECTION 5.1.(w)  The sum of one million dollars ($1,000,000) appropriated in this section to the Department of Health and Human Services in the TANF Block Grant for Boys and Girls Clubs shall be used to make grants for approved programs. The Department of Health and Human Services, in accordance with federal regulations for the use of TANF Block Grant funds, shall administer a grant program to award funds to the Boys and Girls Clubs across the State in order to implement programs that improve the motivation, performance, and self-esteem of youths and to implement other initiatives that would be expected to reduce school dropout and teen pregnancy rates. The Department shall encourage and facilitate collaboration between the Boys and Girls Clubs and Support Our Students, Communities in Schools, and similar programs to submit joint applications for the funds if appropriate.

SECTION 5.1.(x)  The sum of five hundred fifty thousand dollars ($550,000) appropriated in this section to the Department of Health and Human Services in the TANF Block Grant shall be transferred to Work Central, Inc. Work Central, Inc. shall report on the number of people served and the services received as a result of the receipt of funds. The report shall contain expenditure data, including the amount of funds used for administration and direct training. The report shall also include the number of people who have been employed as a direct result of services provided by Work Central, Inc., including the length of employment in the new position. The Department of Health and Human Services shall evaluate the program and ensure that services provided are not duplicative of local employment security commissions in the nine counties served by Work Central, Inc. The evaluation report shall be submitted to the House of Representatives Appropriations Subcommittee on Health and Human Services, the Senate Appropriations Committee on Health and Human Services, and the Fiscal Research Division no later than May 1, 2006.

SECTION 5.1.(y)  The sum of one million four hundred forty-seven thousand six hundred forty dollars ($1,447,640) in this section appropriated to the Department of Health and Human Services in the TANF Block Grant shall be used to implement the component of N.C. FAST that specifically deals with the creation and implementation of a statewide automated child welfare information system. The statewide system shall be implemented in compliance with federal regulations in order to avoid any potential payback of funds due to noncompliance. The Department of Health and Human Services shall report on its compliance with this subsection to the House of Representatives Appropriations Subcommittee on Health and Human Services, the Senate Appropriations Committee on Health and Human Services, and the Fiscal Research Division no later than January 1, 2006.

SECTION 5.1.(z)  The sum of five hundred thousand dollars ($500,000) appropriated in this section to the Department of Health and Human Services, Division of Social Services, in the TANF Block Grant shall be used to expand after-school programs for at-risk children attending middle school. The Department shall develop and implement a grant program to award funds to community-based programs demonstrating the capacity to reach children at risk of teen pregnancy and school dropout. These funds shall not be used for training or administration at the State level. All funds shall be distributed to community-based programs, focusing on those communities where similar programs do not exist in middle schools. The Department shall report to the House of Representatives Appropriations Subcommittee on Health and Human Services, the Senate Appropriations Committee on Health and Human Services, and the Fiscal Research Division on its progress in complying with this subsection no later than May 1, 2006.

MATERNAL AND CHILD HEALTH BLOCK GRANT

SECTION 5.1.(aa)  If federal funds are received under the Maternal and Child Health Block Grant for abstinence education, pursuant to section 912 of Public Law 104-193 (42 U.S.C. 710), for the 2005-2006 fiscal year, then those funds shall be transferred to the State Board of Education to be administered by the Department of Public Instruction. The Department of Public Instruction shall use the funds to establish an Abstinence Until Marriage Education Program and shall delegate to one or more persons the responsibility of implementing the program and G.S. 115C-81(e1)(4). The Department of Public Instruction shall carefully and strictly follow federal guidelines in implementing and administering the abstinence education grant funds.

SECTION 5.1.(bb)  The Department of Health and Human Services shall ensure that there will be follow-up testing in the Newborn Screening Program.

SECTION 5.1.(cc)  Of the funds budgeted in the Maternal and Child Health Block Grant, three million two hundred fifty thousand dollars ($3,250,000) shall be used for a school nurse funding initiative for the 2005-2006 fiscal year. The Department of Health and Human Services, Division of Public Health, in conjunction with the Department of Public Instruction, shall provide funds to communities to hire school nurses. The program will fund approximately 65 time-limited nurses.  The criteria shall include determining the areas in the greatest need for school nurses with the greatest inability to pay for these nurses.  Among other criteria, consideration shall also be given to (i) the current nurse-to-student ratio; (ii) the economic status of the community; and (iii) the health needs of area children.

There shall be no supplanting of local or Title I funds with these block grant funds. Communities shall maintain their current level of effort and funding for school nurses. No block grant funds shall be used for funding nurses for State agencies. All funding shall be used for direct services.

The Department of Health and Human Services shall report on the use of funds allocated under this section by December 1, 2005, to the House of Representatives Appropriations Subcommittee on Health and Human Services, the Senate Appropriations Committee on Health and Human Services, and the Fiscal Research Division.

 

Requested by:            Senators Weinstein, Garrou, Dalton, Hagan

NER BLOCK GRANTS

SECTION 5.2.(a)  Appropriations from federal block grant funds are made for fiscal year ending June 30, 2006, according to the following schedule:

 

COMMUNITY DEVELOPMENT BLOCK GRANT

 

            01.    State Administration                                      $   1,000,000

 

            02.    Urgent Needs and Contingency                          1,000,000

 

            03.    Scattered Site Housing                                     13,200,000

 

            04.    Economic Development                                     8,710,000

 

            05.    Community Revitalization                                13,500,000

 

            06.    State Technical Assistance                                    450,000

 

            07.    Housing Development                                        2,000,000

 

            08.    Infrastructure                                                       5,140,000

 

TOTAL COMMUNITY DEVELOPMENT

BLOCK GRANT - 2006 Program Year                        $ 45,000,000

 

SECTION 5.2.(b)  Decreases in Federal Fund Availability. - If federal funds are reduced below the amounts specified above after the effective date of this act, then every program in each of these federal block grants shall be reduced by the same percentage as the reduction in federal funds.

SECTION 5.2.(c)  Increases in Federal Fund Availability for Community Development Block Grant. - Any block grant funds appropriated by the Congress of the United States in addition to the funds specified in this section shall be expended as follows: each program category under the Community Development Block Grant shall be increased by the same percentage as the increase in federal funds.

SECTION 5.2.(d)  Limitations on Community Development Block Grant Funds. - Of the funds appropriated in this section for the Community Development Block Grant, the following shall be allocated in each category for each program year: up to one million dollars ($1,000,000) may be used for State Administration; not less than one million dollars ($1,000,000) may be used for Urgent Needs and Contingency; up to thirteen million two hundred thousand dollars ($13,200,000) may be used for Scattered Site Housing; up to eight million seven hundred ten thousand dollars ($8,710,000) may be used for Economic Development, including Urban Redevelopment Grants and Small Business or Entrepreneurial Assistance; not less than thirteen million five hundred thousand dollars ($13,500,000) shall be used for Community Revitalization; up to four hundred fifty thousand dollars ($450,000) may be used for State Technical Assistance; up to two million dollars ($2,000,000) may be used for Housing Development; up to five million one hundred forty thousand dollars ($5,140,000) may be used for Infrastructure.  If federal block grant funds are reduced or increased by the Congress of the United States after the effective date of this act, then these reductions or increases shall be allocated in accordance with subsection (b) or (c) of this section, as applicable.

SECTION 5.2.(e)  Increase Capacity for Nonprofit Organizations. - Assistance to nonprofit organizations to increase their capacity to carry out CDBG-eligible activities in partnership with units of local government is an eligible activity under any program category in accordance with federal regulations.  Capacity building grants may be made from funds available within program categories, program income, or unobligated funds.

SECTION 5.2.(f)  Department of Commerce Demonstration Grants in Partnership with Rural Economic Development Center, Inc. - The Department of Commerce, in partnership with the Rural Economic Development Center, Inc., shall award up to two million two hundred fifty thousand dollars ($2,250,000) in demonstration grants to local governments in very distressed rural areas of the State.  These grants shall be used to address critical infrastructure and entrepreneurial needs and to provide small business assistance.

SECTION 5.2.(g)  The Department of Commerce shall consult with the Joint Legislative Commission on Governmental Operations prior to reallocating Community Development Block Grant Funds.  Notwithstanding the provisions of this subsection, whenever the Director of the Budget finds that:

(1)       A reallocation is required because of an emergency that poses an imminent threat to public health or public safety, the Director of the Budget may authorize the reallocation without consulting the Commission. The Department of Commerce shall report to the Commission on the reallocation no later than 30 days after it was authorized and shall identify in the report the emergency, the type of action taken, and how it was related to the emergency.

(2)       The State will lose federal block grant funds or receive less federal block grant funds in the next fiscal year unless a reallocation is made, the Department of Commerce shall provide a written report to the Commission on the proposed reallocation and shall identify the reason that failure to take action will result in the loss of federal funds. If the Commission does not hear the issue within 30 days of receipt of the report, the Department may take the action without consulting the Commission.

 

 

PART VI. general provisions

 

Requested by:            Senators Garrou, Dalton, Hagan

APPROPRIATION OF CASH BALANCES AND RECEIPTS

SECTION 6.1.(a)  Expenditures of cash balances, federal funds, departmental receipts, grants, and gifts from the various General Fund, Special Revenue Fund, Enterprise Fund, Internal Service Fund, and Trust and Agency Fund budget codes are appropriated and authorized for the 2005-2007 fiscal biennium as follows:

(1)       For all budget codes listed in "State of North Carolina, Recommended Continuation Budget 2005-2007, Volumes 1 through 6", cash balances and receipts are appropriated up to the amounts specified in Volumes 1 through 6, as adjusted by the General Assembly, for the 2005-2006 fiscal year and the 2006-2007 fiscal year. Funds may be expended only for the programs and purposes and objects and line items specified in Volumes 1 through 6, or otherwise authorized by the General Assembly.

(2)       For all budget codes that are not listed in "State of North Carolina, Recommended Continuation Budget 2005-2007, Volumes 1 through 6", cash balances and receipts are appropriated for each year of the 2005-2007 fiscal biennium up to the level of actual expenditures for the 2004-2005 fiscal year, unless otherwise provided by law. Funds may be expended only for the programs and purposes and objects and line items authorized for the 2004-2005 fiscal year.

(3)       Notwithstanding subdivisions (1) and (2) of this subsection, any receipts that are required to be used to pay debt service requirements for various outstanding bond issues and certificates of participation are appropriated up to the actual amounts received for the 2005-2006 fiscal year and the 2006-2007 fiscal year and shall be used only to pay debt service requirements.

(4)       Notwithstanding subdivisions (1) and (2) of this subsection, cash balances and receipts of funds that meet the definition issued by the Governmental Accounting Standards Board of a trust or agency fund, are appropriated for and in the amounts required to meet the legal requirements of the trust agreement for the 2005-2006 fiscal year and the 2006-2007 fiscal year.

All these cash balances, federal funds, departmental receipts, grants, and gifts shall be expended and reported in accordance with the provisions of the Executive Budget Act, except as otherwise provided by law and this section.

SECTION 6.1.(b)  Receipts collected in a fiscal year in excess of the amounts authorized by this section shall remain unexpended and unencumbered until appropriated by the General Assembly in a subsequent fiscal year, unless the expenditure of over-realized receipts in the fiscal year in which the receipts were collected is authorized by the Executive Budget Act.

Over-realized receipts are appropriated up to the amounts necessary to implement this subsection.

In addition to the consultation and reporting requirements set out in G.S. 143-23 and G.S. 143-27, the Office of State Budget and Management shall report to the Joint Legislative Commission on Governmental Operations and to the Fiscal Research Division of the Legislative Services Office within 30 days after the end of each quarter on any over-realized receipts approved for expenditure under this subsection by the Director of the Budget. The report shall include the source of the receipt, the amount over-realized, the amount authorized for expenditure, and the rationale for expenditure.

SECTION 6.1.(c)  Notwithstanding subsections (a) and (b) of this section, there is appropriated from the Reserve for Reimbursements to Local Governments and Shared Tax Revenues for each fiscal year an amount equal to the amount of the distributions required by law to be made from that reserve for that fiscal year.

SECTION 6.1.(d)  Notwithstanding subsections (a) and (b) of this section, if Senate Bill 1126, 2005 Session, or substantially similar legislation revising the Coastal Recreational Fishing License program or establishing a unified fishing license for hunting and fishing in coastal, joint, and inland waters, becomes law, any receipts from license revenues generated pursuant to such legislation are hereby appropriated for the 2005-2006 fiscal year and the 2006-2007 fiscal year for programs and purposes authorized by law.

SECTION 6.1.(e)  Notwithstanding subsections (a)(2) and (b) of this section, the cash balances and receipts of any occupational licensing board, as defined in G.S. 93B-1, that are not included in the budget codes listed in "State of North Carolina, Recommended Continuation Budget 2005-2007, Volumes 1 through 6," are hereby appropriated for the 2005-2006 fiscal year and the 2006-2007 fiscal year and may be expended for programs and purposes authorized by law.

 

Requested by:            Senators Garrou, Dalton, Hagan

contingency and emergency fund allocations

SECTION 6.2.  Funds in the amount of five million dollars ($5,000,000) for the 2005-2006 fiscal year and five million dollars ($5,000,000) for the 2006-2007 fiscal year are appropriated in this act to the Contingency and Emergency Fund.  Of these funds:

(1)       Up to two million dollars ($2,000,000) for the 2005-2006 fiscal year may be used for purposes related to the Base Realignment and Closure Act (BRAC); and

(2)       Up to five hundred thousand dollars ($500,000) for the 2005-2006 fiscal year and up to five hundred thousand dollars ($500,000) for the 2006-2007 fiscal year may be expended for purposes other than those set out in G.S.143-23(a1)(2) or in subdivision (1) of this section.

The remainder of these funds shall be expended for purposes outlined in G.S. 143-23(a1)(2).

 

Requested by:            Senators Garrou, Dalton, Hagan

expenditures of funds in reserves limited

SECTION 6.3.  All funds appropriated by this act into reserves may be expended only for the purposes for which the reserves were established.

 

Requested by:            Senators Garrou, Dalton, Hagan

Budget Reports accurately reflect projected receipts, expenditures, fund balances, and actual collections

SECTION 6.4.  G.S. 143-11(a) reads as rewritten:

" 143-11.  Survey of departments. departments and recommended budget report.

(a)       On or before the fifteenth day of December, biennially in the even-numbered years, the Director shall make a complete, careful survey of the operation and management of all the departments, bureaus, divisions, officers, boards, commissions, institutions, and agencies and undertakings of the State and all persons or corporations who use or expend State funds, in the interest of economy and efficiency, and of obtaining a working knowledge upon which to base recommendations to the General Assembly as to appropriations for maintenance and special funds and capital expenditures for the succeeding biennium. If the Director and the Commission shall agree in their recommendations for the budget for the next biennial period, he shall prepare their report in the form of a proposed budget, together with such comment and recommendations as they may deem proper to make. If the Director and Commission shall not agree in substantial particulars, the Director shall prepare the proposed budget based on his own conclusions and judgment, and the Commission or any of its members retain the right to submit separately to the General Assembly such statement of disagreement and the particulars thereof as representing their views. The budget report shall contain a complete and itemized plan of all proposed expenditures for each State department, bureau, board, division, institution, commission, State agency or undertaking, person or corporation who receives or may receive for use and expenditure any State funds, in accordance with the classification of funds and accounts adopted by the State Controller, and of the estimated revenues and borrowings for each year in the ensuing biennial period beginning with the first day of July thereafter. Opposite each line item of the proposed expenditures, the budget shall show in separate parallel columns:

(1)       Proposed expenditures and receipts for each fiscal year of the biennium;

(2)       The certified budget for the preceding fiscal year;

(3)       The currently authorized budget for the preceding fiscal year;

(4)       Actual expenditures and receipts for the most recent fiscal year for which actual expenditure information is available; and

(5)       Proposed increases and decreases.

Revenue and expenditure information shall be no less specific than the two-digit level in the State Accounting System Chart of Accounts as prescribed by the State Controller. The budget shall clearly differentiate between general fund expenditures for operating and maintenance, special fund expenditures for any purpose, and proposed capital improvements. The budget report shall include accurate projections of receipts, expenditures, and fund balances for all budget codes, funds, and accounts. Estimated receipts, including tuition collected by university or community college institutions, shall be adjusted to reflect actual collections from the previous fiscal year, unless the Director either (i) recommends a change that will result in collections in the budget year that differ from the actual collections of the prior year or (ii) otherwise determines there is a more reasonable basis upon which to accurately project receipts."

 

Requested by:            Senators Garrou, Dalton, Hagan

AUTHORIZATION TO ESTABLISH RECEIPT-SUPPORTED POSITIONS

SECTION 6.5.  Notwithstanding G.S. 143-34.1(a1), a department, institution, or other agency of State government may establish receipt-supported positions authorized in this act upon approval by the Director of the Budget.  The Director, if necessary, may establish a receipt-supported position pursuant to this section at an annual salary amount different from the salary amount set out in this act if (i) funds are available from the proposed funding source and (ii) the alternative salary amount remains within the established salary range grade identified for the job classification of the affected receipt-supported position established in this act. The Director shall not change the job classifications or increase the number of receipt-supported positions specified in this act without prior consultation with the Joint Legislative Commission on Governmental Operations.

 

Requested by:            Senators Garrou, Dalton, Hagan

Overhead Cost Recovery

SECTION 6.6.(a)  The General Assembly finds that the General Fund  supports many state agencies that provide services and administer programs that impact all of State government.  These agencies include the Office of the Governor, the Office of State Controller, the Department of Administration, including the Office of State Personnel, State Property Office, Office of State Construction, and the Division of Purchase and Contract, the Secretary of State, the Office of State Treasurer, and the Office of State Auditor.  The General Assembly also finds that the General Fund supports the departmental administrative overhead costs for many receipt-supported programs, activities, boards, and commissions.  The General Assembly further finds that only federally funded programs routinely reimburse the State for such administrative overhead activities through an indirect cost allocation method.  The General Assembly finds that an indirect cost allocation program should be established to recover overhead and indirect costs from all receipt-supported programs, activities, boards, and commissions.

SECTION 6.6.(b)  The Office of State Budget and Management shall study the collection of overhead receipts and develop an overhead cost recovery program. In implementing this section, the Office of State Budget and Management shall do the following:

(1)       For each receipt, determine the authority and requirements for the allocation of overhead costs and collection of overhead receipts.

(2)       For each receipt for which the State currently redirects a portion for overhead costs, ensure that all future receipts revert to the General Fund in accordance with the State Budget Manual, except as otherwise required by law.

(3)       For each receipt for which the State does not currently redirect a portion for overhead costs, establish an indirect cost allocation methodology and redirect a portion of future receipts for overhead costs to the General Fund, except as otherwise required by law.

(5)       Estimate the anticipated reimbursement to the General Fund for the 2006-2007 fiscal year.

(6)       Effective with the 2006-2007 fiscal year, the Office of State Budget and Management shall implement the overhead cost recovery program to maximize reimbursement of statewide indirect costs supported by the General Fund.

SECTION 6.6.(c)  The Office of State Budget and Management shall report on its progress in implementing this section to the Chairs of the Senate Committee on Appropriations/Base Budget, the Chairs of the House of Representatives Committee on Appropriations, and the Fiscal Research Division by April 1, 2006.  The report shall recommend any statutory changes required to implement the requirements of this section. 

SECTION 6.6.(d)  This section does not apply to overhead cost reimbursements collected under any grant agreement by The University of North Carolina or any of its affiliated institutions. 

SECTION 6.6.(e)  The requirements of this section shall apply to all receipts credited to a State agency, special revenue fund, enterprise fund, internal service fund or trust fund, except as otherwise provided by law and subsection (d) of this section.

 

Requested by:            Senators Garrou, Dalton, Hagan

prior consultation with the joint legislative commission on governmental operations

SECTION 6.7.(a)  The last paragraph of G.S. 120-76(8) is recodified as G.S. 120-76.1 and reads as rewritten:

" 120-76.1.  Prior consultation with the Commission.

(a)       Notwithstanding the provisions of this subdivision G.S. 120-76(8) or any other provision of law requiring prior consultation by the Governor with the Commission, whenever an expenditure is required because of an emergency that poses an imminent threat to public health or public safety, and is either the result of a natural event, such as a hurricane or a flood, or an accident, such as an explosion or a wreck, the Governor may take action under this subsection without consulting the Commission if the action is determined by the Governor to be related to the emergency. The Governor shall report to the Commission on any expenditures made under this paragraph subsection no later than 30 days after making the expenditure and shall identify in the report the emergency, the type of action taken, and how it was related to the emergency.

(b)       Any agency, board, commission, or other entity required under G.S. 120-76(8) or any other provision of law to consult with the Commission prior to taking an action shall submit a detailed report of the action under consideration to the Chairs of the Commission, the Commission Assistant, and the Fiscal Research Division of the General Assembly. If the Commission does not hold a meeting to hear the consultation within 60 days of receiving the submission of the detailed report, the consultation requirement is satisfied."

SECTION 6.7.(b)  G.S. 143-23(a1) reads as rewritten:

"(a1)    Notwithstanding the provisions of subsection (a) of this section, a department, institution, or other spending agency may, with approval of the Director of the Budget, spend more than was appropriated for:

(1)       An object or line item within a purpose or program so long as the total amount expended for the purpose or program is no more than was appropriated from all sources for the purpose or program for the fiscal period;

(2)       A purpose or program, without consultation with the Joint Legislative Commission on Governmental Operations, if the overexpenditure of the purpose or program is:

a.         Required by a court, Industrial Commission, or administrative hearing officer's order;

b.         Required to respond to an unanticipated disaster such as a fire, hurricane, or tornado; or

c.         Required to call out the National Guard.

The Director of the Budget shall report on a quarterly basis to the Joint Legislative Commission on Governmental Operations on any overexpenditures under this subdivision; or

(3)       A purpose or program, after consultation with the Joint Legislative Commission on Governmental Operations in accordance with G.S. 120-76(8), and only if: (i) the overexpenditure is required to continue the purpose or programs due to complications or changes in circumstances that could not have been foreseen when the budget for the fiscal period was enacted and (ii) the scope of the purpose or program is not increased. The consultation is required as follows:

a.         For a purpose or program with a certified budget of up to five million dollars ($5,000,000), consultation is required when the authorization for the overexpenditure exceeds ten percent (10%) of the certified budget;

b.         For a purpose or program with a certified budget of from five million dollars ($5,000,000) up to twenty million dollars ($20,000,000), consultation is required when the authorization for the overexpenditure exceeds five hundred thousand dollars ($500,000) or seven and one-half percent (7.5%) of the certified budget, whichever is greater;

c.         For a purpose or program with a certified budget of twenty million dollars ($20,000,000) or more, consultation is required when the authorization for the overexpenditure exceeds one million five hundred thousand dollars ($1,500,000) or five percent (5%) of the certified budget, whichever is greater;

d.         For a purpose or program supported by federal funds or when expenditures are required for the reasons set out in subdivision (2) of this subsection, no consultation is required.

If the Joint Legislative Commission on Governmental Operations does not meet for more than 30 days, the Director of the Budget may satisfy the requirements of the subsection to report to or consult with the Commission by reporting to or consulting with a joint meeting of the Chairs of the Appropriations Committees of the Senate and the House of Representatives."

 

Requested by:            Senators Garrou, Dalton, Hagan

consultation not required prior to establishing or increasing fees in accordance with budget act

SECTION 6.8.(a)  Notwithstanding G.S. 12-3.1(a), an agency is not required to consult with the Joint Legislative Commission on Governmental Operations prior to establishing or increasing a fee as authorized or anticipated in the Current Operations and Capital Improvements Appropriations Act of 2005 or the Senate Appropriations Committee Report on the Continuation, Expansion and Capital Budgets, which was distributed in the Senate and the House of Representatives and used to explain this act.

SECTION 6.8.(b)  This section expires June 30, 2007.

 

Requested by:            Senators Garrou, Dalton, Hagan

State Money Recipients/Conflict of Interest Policy

SECTION 6.9.(a)  G.S. 143-6.2 is amended by adding a new subsection to read:

"(a1)    Every non-State entity that receives, uses, or expends State funds, either by General Assembly appropriation, or by grant, loan, or other allocation from a State agency shall file with the State department or agency disbursing funds to the entity a copy of that entity's policy addressing conflicts of interest that may arise involving the entity's management employees and the members of its board of directors or other governing body before funds may be disbursed to the entity. The policy shall address situations in which any of these individuals may directly or indirectly benefit, except as the entity's employees or members of the board or other governing body, from the entity's disbursing of State funds, and shall include actions to be taken by the entity or the individual, or both, to avoid conflicts of interest and the appearance of impropriety."

SECTION 6.9.(b)  G.S. 143-6.2(d) is amended by adding a new subdivision to read:

"(13)   Require grantees to report their policies addressing conflicts of interest that may arise involving the entity's management employees and the members of its board of directors or other governing body before funds may be disbursed to the entity."

SECTION 6.9.(c)  This section applies to non-State entities that receive State funds on or after July 1, 2005, and State funds shall not be disbursed to those entities on or after July 1, 2005, until the entity files the policy required by this section with the disbursing agency or department.

 

Requested by:            Senators Garrou, Dalton, Hagan

Non-State Entities Shall Not Have Outstanding Tax Assessments/Applicability of Reporting Requirements

SECTION 6.10.(a)  G.S. 143-6.2 is amended by adding a new subsection to read:

"(c1)    No Overdue Tax Debts. - No grantee or subgrantee shall receive a grant of State funds from a State agency, department, or institution if the grantee or subgrantee has any overdue tax debts, as defined by G.S. 105-243.1, at the federal, State, or local level."

SECTION 6.10.(b)  This section shall apply to all State grant funds appropriated or awarded on or after July 1, 2005.  Grants awarded prior to July 1, 2005, shall be subject to the reporting requirements in effect at the time the grant was made.

 

Requested by:            Senators Garrou, Dalton, Hagan, Kerr, Hoyle

RESERVE FOR SMALL EMPLOYER HEALTH INSURANCE

SECTION 6.11.(a)  It is the intent of the General Assembly to establish Healthy NC, a program to assist small employers in purchasing affordable health insurance coverage for their employees.  It is further the intent of the General Assembly that Healthy NC will be modeled after the Healthy NY program operating successfully in that state since 2001.  Healthy NC will be designed to encourage small employers with 50 or fewer employees to offer health insurance coverage to their employees and dependents and other qualified individuals.  Uninsured sole proprietors and workers whose employers do not provide health insurance may also purchase coverage directly from insurers participating in Healthy NC.  Coverage under Healthy NC will be streamlined, yet comprehensive.  Benefits available will include inpatient and outpatient hospital services, physician services, maternity care, preventive health services, diagnostic and X-ray services, and emergency services. Employers may select a benefit package that offers limited prescription drug coverage, or one that does not include coverage for prescription drugs.  A feature of  Healthy NC  that will enable premiums to be set at affordable rates is the availability of stop-loss coverage to protect insurers from excessive claims.  Stop-loss coverage is an insurance policy or other arrangement whereby stop-loss funds are used to pay claims or indemnify the health plan insurer for losses incurred under the health plan in excess of specified loss limits for individual claims or for all claims combined.  It is anticipated that successes of Healthy NC will be marked by, among other things, affordable premiums and an increase in the number of small employers and their employees that have health care coverage.

SECTION 6.11.(b)  There is created in the Office of State Budget and Management a nonreverting Reserve for Healthy NC.  Funds appropriated in this act to the Reserve for Healthy NC shall be allocated by the Commissioner of Insurance exclusively for the purpose of reimbursing insurers providing health insurance to small employers under Part 5A of Article 50 of Chapter 58 of the General Statutes, Healthy NC Program, if enacted by the 2005 General Assembly.

SECTION 6.11.(c)  Subsection (b) of this section becomes effective only if the 2005 General Assembly enacts the Healthy NC program and appropriates funds to the Reserve for Healthy NC.

 

Requested by:            Senators Garrou, Dalton, Hagan

Amend the Tobacco Reserve Fund to Promote the Health and Wellness of the State's Citizens and Economic Development

SECTION 6.12.(a)  G.S. 66-291(b)(2) reads as rewritten:

"(2)      To the extent that a tobacco product manufacturer establishes that the amount it was required to place into escrow on account of units sold in the State in a particular year was greater than the State's allocable share of the total payments that such manufacturer would have been required to make in that year under the Master Settlement Agreement (as determined pursuant to section IX(i)(2) of the Master Settlement Agreement, and before any of the adjustments or offsets described in section IX(i)(3) of that Agreement other than the Inflation Adjustment)the Master Settlement Agreement payments, as determined pursuant to Section IX(i) of that agreement, including after final determination of all adjustments, that the manufacturer would have been required to make on account of the units sold had it been a participating manufacturer, the excess shall be released from escrow and revert back to such tobacco product manufacturer; or".

SECTION 6.12.(b)  If this section, or any portion of the amendment made to G.S. 66-291(b)(2) by this section, is held by a court of competent jurisdiction to be unconstitutional, then G.S. 66-291(b)(2) shall be deemed to be repealed in its entirety.  If G.S. 66-291(b)(2) shall thereafter be held by a court of competent jurisdiction to be unconstitutional, then this section shall be repealed, and G.S. 66-291(b)(2) shall be restored as if no amendments had been made by this section.  Neither any judicial holding of unconstitutionality nor the repeal of G.S. 66-291(b)(2) shall affect, impair, or invalidate any other portion of Part 1 of Article 37 of Chapter 66 of the General Statutes or the application of Part 1 of Article 37 of Chapter 66 of the General Statutes to any other person or circumstance, and the remaining portions of Part 1 of Article 37 of Chapter 66 of the General Statutes shall at all times continue in full force and effect.

SECTION 6.12.(c)  This section becomes effective October 1, 2005.

 

Requested by:            Senators Garrou, Dalton, Hagan

stATEWIDE INFORMATION TECHNOLOGY PROJECTS

SECTION 6.13.(a)  There is appropriated from the Information Technology Fund established in G.S. 147-33.72H to the Office of Information Technology Services the sum of five million one hundred thousand dollars ($5,100,000) for the 2005-2006 fiscal year and the sum of three million three hundred thousand dollars ($3,300,000) for the 2006-2007 fiscal year to continue existing Information Technology Fund activities including project management assistance, security assessment remedial actions, asset management, related legal support, and legacy system assessment.

SECTION 6.13.(b)  There is appropriated from the Information Technology Fund established in G.S. 147-33.72H to the Office of Information Technology Services the sum of one million six hundred thousand dollars ($1,600,000) for the 2005-2006 fiscal year and the sum of one million four hundred thousand dollars ($1,400,000) for the 2006-2007 fiscal year to establish two project management assistant positions and one enterprise licensing position and to purchase and maintain asset management software and enterprise licenses.

SECTION 6.13.(c)  There is appropriated from the Information Technology Fund established in G.S. 147-33.72H to the Office of Information Technology Services the sum of six million three hundred thousand dollars ($6,300,000) for  the 2005-2006 fiscal year and the sum of five million eight hundred thousand dollars ($5,800,000) for the 2006-2007 fiscal year  to provide services previously supported by cross-subsidies  in the information technology rate structure, including: (i) the operation of Enterprise Technology Services within the Office of Information Technology Services, (ii) security services, (iii) State portal maintenance, (iv) enterprise identity management, and (v) the operations of the Office of the State Chief Information Officer.

SECTION 6.13.(d)  There is appropriated from the Information Technology Fund established in G.S. 147-33.72H to the Office of Information Technology Services the sum of five hundred thousand dollars ($500,000) for the 2005-2006 fiscal year to facilitate consolidation of information technology activities in State agencies.

 

Requested by:            Senators Garrou, Dalton, Hagan

STATE BUSINESS INFRASTRUCTURE PROGRAM

SECTION 6.14.(a)  According to a study conducted by the Office of State Controller, the State's personnel and payroll information systems are at risk of failure within five years.  This would result in delayed payments to over 80,000 state employees.  The current personnel and payroll information systems were designed and supported by agency staff, and staff members familiar with these information systems are near retirement from State government service.  Through the State Business Infrastructure Program, the State Controller identified the personnel and payroll information systems as priorities for replacement.

SECTION 6.14.(b)  There is appropriated from the Information Technology Fund established in G.S.147-33.72H to the Office of State Controller the sum of twenty million eight hundred seventy-five thousand dollars ($20,875,000) for the 2005-2006 fiscal year and two million five hundred twenty-five thousand dollars ($2,525,000) for the 2006-2007 fiscal year to initiate the replacement of the State's personnel and payroll information systems.  These funds shall be used to procure software, hardware, integration services, project management, implementation activities, software license maintenance, hardware maintenance, contract support, and Information Technology Services Data Center activities.

SECTION 6.14.(c)  Funds appropriated under this section are subject to the reporting requirement set out in G.S. 147-33.72H.

 

Requested by:            Senators Garrou, Dalton, Hagan

information technology fund

SECTION 6.15.(a)  Of the funds collected by the Office of Information Technology Services from the information technology enterprise fee approved by the Office of State Budget and Management pursuant to G.S. 147-33.82, the Office shall deposit the sum of five million dollars ($5,000,000) for the 2005-2006 fiscal year and for the 2006-2007 fiscal year in the Information Technology Fund established in G.S. 147-33.72H.

SECTION 6.15.(b)  Effective July 1, 2005, the State Controller shall transfer to the Information Technology Fund established in G.S. 147-33.72H the sum of five million dollars ($5,000,000) from the cash balance remaining in the Office of Information Technology Services Internal Service Fund on June 30, 2005.  These funds shall be used to support statewide information technology initiatives.

 

PART vII. PUBLIC SCHOOLS

 

Requested by:            Senator Lucas, Swindell, Garrou, Dalton, Hagan

teacher salary schedules

SECTION 7.1.(a)  Effective for the 2005-2006 school year and for the 2006-2007 school year, the Director of the Budget shall transfer from the Reserve for Experience Step Salary Increase for Teachers and Principals in Public Schools funds necessary to implement the teacher salary schedules set out in subsection (b) of this section and for longevity in accordance with subsection (d) of this section, including funds for the employer's retirement and social security contributions for all teachers whose salaries are supported from the State's General Fund.

These funds shall be allocated to individuals according to rules adopted by the State Board of Education.

SECTION 7.1.(b)  The following monthly salary schedules shall apply for the 2005-2006 and the 2006-2007 fiscal years to certified personnel of the public schools who are classified as teachers.  The schedule contains 30 steps with each step corresponding to one year of teaching experience.

 

2005-2006 Monthly Salary Schedule

"A" Teachers

 

Years of Experience                     "A" Teachers                          NBPTS Certification

 

             0                                             $2,545                                               N/A

             1                                             $2,587                                               N/A

             2                                             $2,631                                               N/A

             3                                             $2,786                                          $3,120

             4                                             $2,926                                          $3,278

             5                                             $3,059                                          $3,427

             6                                             $3,189                                          $3,571

             7                                             $3,292                                          $3,687

             8                                             $3,340                                          $3,740

             9                                             $3,389                                          $3,795

           10                                             $3,439                                          $3,851

           11                                             $3,488                                          $3,906

           12                                             $3,539                                          $3,963

           13                                             $3,589                                          $4,019

           14                                             $3,642                                          $4,079

           15                                             $3,696                                          $4,140

           16                                             $3,751                                          $4,202

           17                                             $3,806                                          $4,263

           18                                             $3,864                                          $4,328

           19                                             $3,922                                          $4,393

           20                                             $3,980                                          $4,458

           21                                             $4,042                                          $4,528

           22                                             $4,104                                          $4,596

           23                                             $4,169                                          $4,669

           24                                             $4,233                                          $4,740

           25                                             $4,298                                          $4,813

           26                                             $4,364                                          $4,887

           27                                             $4,432                                          $4,963

           28                                             $4,502                                          $5,043

           29                                             $4,573                                          $5,122

 

 

2005-2006 Monthly Salary Schedule

"M" Teachers

 

Years of Experience                 "M" Teachers                         NBPTS Certification

 

                                                       

             0                                             $2,800                                               N/A

             1                                             $2,846                                               N/A

             2                                             $2,894                                               N/A

             3                                             $3,063                                          $3,431

             4                                             $3,219                                          $3,605

             5                                             $3,366                                          $3,769

             6                                             $3,507                                          $3,927

             7                                             $3,621                                          $4,055

             8                                             $3,673                                          $4,114

             9                                             $3,727                                          $4,175

           10                                             $3,782                                          $4,236

           11                                             $3,837                                          $4,298

           12                                             $3,892                                          $4,360

           13                                             $3,947                                          $4,421

           14                                             $4,006                                          $4,487

           15                                             $4,065                                          $4,553

           16                                             $4,126                                          $4,621

           17                                             $4,188                                          $4,690

           18                                             $4,250                                          $4,759

           19                                             $4,315                                          $4,832

           20                                             $4,379                                          $4,904

           21                                             $4,447                                          $4,980

           22                                             $4,514                                          $5,056

           23                                             $4,585                                          $5,136

           24                                             $4,656                                          $5,215

           25                                             $4,726                                          $5,288

           26                                             $4,795                                          $5,376

           27                                             $4,875                                          $5,460

           28                                             $4,952                                          $5,547

           29                                             $5,031                                          $5,634

 

 

2006-2007 Monthly Salary Schedule

"A" Teachers

 

Years of Experience                  "A" Teachers                          NBPTS Certification

 

             0                                             $2,574                                               N/A

             1                                             $2,617                                               N/A

             2                                             $2,661                                               N/A

             3                                             $2,818                                          $3,156

             4                                             $2,960                                          $3,315

             5                                             $3,095                                          $3,466

             6                                             $3,225                                          $3,612

             7                                             $3,329                                          $3,729

             8                                             $3,378                                          $3,783

             9                                             $3,428                                          $3,839

           10                                             $3,478                                          $3,896

           11                                             $3,528                                          $3,951

           12                                             $3,580                                          $4,009

           13                                             $3,630                                          $4,066

           14                                             $3,684                                          $4,126

           15                                             $3,739                                          $4,187

           16                                             $3,794                                          $4,250

           17                                             $3,850                                          $4,312

           18                                             $3,909                                          $4,378

           19                                             $3,967                                          $4,443

           20                                             $4,026                                          $4,509

           21                                             $4,089                                          $4,580

           22                                             $4,151                                          $4,649

           23                                             $4,217                                          $4,723

           24                                             $4,281                                          $4,795

           25                                             $4,347                                          $4,869

           26                                             $4,414                                          $4,944

           27                                             $4,483                                          $5,021

           28                                             $4,554                                          $5,101

           29                                             $4,626                                          $5,181

 

2006-2007 Monthly Salary Schedule

"M" Teachers

 

 

Years of Experience                 "M" Teachers                         NBPTS Certification

 

             0                                             $2,832                                               N/A

             1                                             $2,879                                               N/A

             2                                             $2,927                                               N/A

             3                                             $3,099                                          $3,470

             4                                             $3,256                                          $3,646

             5                                             $3,404                                          $3,812

             6                                             $3,547                                          $3,972

             7                                             $3,663                                          $4,102

             8                                             $3,715                                          $4,161

             9                                             $3,770                                          $4,223

           10                                             $3,826                                          $4,284

           11                                             $3,881                                          $4,347

           12                                             $3,937                                          $4,410

           13                                             $3,993                                          $4,472

           14                                             $4,052                                          $4,539

           15                                             $4,112                                          $4,605

           16                                             $4,173                                          $4,674

           17                                             $4,236                                          $4,744

           18                                             $4,299                                          $4,814

           19                                             $4,364                                          $4,888

           20                                             $4,429                                          $4,961

           21                                             $4,498                                          $5,038

           22                                             $4,566                                          $5,114

           23                                             $4,638                                          $5,195

           24                                             $4,710                                          $5,275

           25                                             $4,781                                          $5,355

           26                                             $4,855                                          $5,438

           27                                             $4,931                                          $5,523

           28                                             $5,009                                          $5,611

           29                                             $5,088                                          $5,699

 

SECTION 7.1.(c)  Annual longevity payments for teachers shall be at the rate of one and one-half percent (1.5%) of base salary for 10 to 14 years of State service, two and twenty-five hundredths percent (2.25%) of base salary for 15 to 19 years of State service, three and twenty-five hundredths percent (3.25%) of base salary for 20 to 24 years of State service, and four and one-half percent (4.5%) of base salary for 25 or more years of State service.  The longevity payment shall be paid in a lump sum once a year.

SECTION 7.1.(d)  Certified public schoolteachers with certification based on academic preparation at the six-year degree level shall receive a salary supplement of one hundred twenty-six dollars ($126.00) per month in addition to the compensation provided for certified personnel of the public schools who are classified as "M" teachers.  Certified public schoolteachers with certification based on academic preparation at the doctoral degree level shall receive a salary supplement of two hundred fifty-three dollars ($253.00) per month in addition to the compensation provided for certified personnel of the public schools who are classified as "M" teachers.

SECTION 7.1.(e)  The first step of the salary schedule for school psychologists shall be equivalent to Step 5, corresponding to five years of experience, on the salary schedule established in this section for certified personnel of the public schools who are classified as "M" teachers.  Certified psychologists shall be placed on the salary schedule at an appropriate step based on their years of experience.  Certified psychologists shall receive longevity payments based on years of State service in the same manner as teachers.

Certified psychologists with certification based on academic preparation at the six-year degree level shall receive a salary supplement of one hundred twenty-six dollars ($126.00) per month in addition to the compensation provided for certified psychologists. Certified psychologists with certification based on academic preparation at the doctoral degree level shall receive a salary supplement of two hundred fifty-three dollars ($253.00) per month in addition to the compensation provided for certified psychologists.

SECTION 7.1.(f)  Speech pathologists who are certified as speech pathologists at the masters degree level and audiologists who are certified as audiologists at the masters degree level and who are employed in the public schools as speech and language specialists and audiologists shall be paid on the school psychologist salary schedule.

Speech pathologists and audiologists with certification based on academic preparation at the six-year degree level shall receive a salary supplement of one hundred twenty-six dollars ($126.00) per month in addition to the compensation provided for speech pathologists and audiologists. Speech pathologists and audiologists with certification based on academic preparation at the doctoral degree level shall receive a salary supplement of two hundred fifty-three dollars ($253.00) per month in addition to the compensation provided for speech pathologists and audiologists.

SECTION 7.1.(g)  Certified school nurses who are employed in the public schools as nurses shall be paid on the "M" salary schedule.

SECTION 7.1.(h)  As used in this section, the term "teacher" shall also include instructional support personnel.

 

Requested by:            Senator Lucas, Swindell, Garrou, Dalton, Hagan

SCHOOL-BASED ADMINISTRATOR SALARY SCHEDULE

SECTION 7.2.(a)  Effective for the 2005-2006 school year and for the 2006-2007 school year, the Director of the Budget shall transfer from the Reserve for Compensation Increases funds necessary to implement the salary schedules for school-based administrators as provided in this section.  These funds shall be used for State-paid employees only.

SECTION 7.2.(b)  The base salary schedule for school-based administrators shall apply only to principals and assistant principals.  The base salary schedule for the 2005-2006 fiscal year, commencing July 1, 2005, is as follows:

 

2005-2006

Principal and Assistant Principal Salary Schedules

Classification

 

Yrs. of                 Assistant                Prin I               Prin II             Prin III            Prin IV

Exp                      Principal               (0-10)            (11-21)           (22-32)          (33-43)

 

0-4                   $3,256                                                        -                      -                      - 

5                       $3,404                               -                        -                      -                      - 

6                       $3,547                               -                        -                      -                      - 

7                       $3,662                               -                        -                      -                      - 

8                       $3,715                      $3,715                       -                      -                      - 

9                       $3,769                      $3,769                       -                      -                      - 

10                     $3,825                      $3,825             $3,880                     -                      - 

11                     $3,880                      $3,880             $3,936                     -                      - 

12                     $3,936                      $3,936             $3,993            $4,052                     - 

13                     $3,993                      $3,993             $4,052            $4,111            $4,173

14                     $4,052                      $4,052             $4,111            $4,173            $4,235

15                     $4,111                      $4,111             $4,173            $4,235            $4,298

16                     $4,173                      $4,173             $4,235            $4,298            $4,363

17                     $4,235                      $4,235             $4,298            $4,363            $4,428

18                     $4,298                      $4,298             $4,363            $4,428            $4,497

19                     $4,363                      $4,363             $4,428            $4,497            $4,565

20                     $4,428                      $4,428             $4,497            $4,565            $4,638

21                     $4,497                      $4,497             $4,565            $4,638            $4,708

22                     $4,565                      $4,565             $4,638            $4,708            $4,780

23                     $4,638                      $4,638             $4,708            $4,780            $4,855

24                     $4,708                      $4,708             $4,780            $4,855            $4,931

25                     $4,780                      $4,780             $4,855            $4,931            $5,008

26                     $4,855                      $4,855             $4,931            $5,008            $5,088

27                     $4,931                      $4,931             $5,008            $5,088            $5,189

28                     $5,008                      $5,008             $5,088            $5,189            $5,294

29                     $5,088                      $5,088             $5,189            $5,294            $5,400

30                     $5,189                      $5,189             $5,294            $5,400            $5,508

31                     $5,294                      $5,294             $5,400            $5,508            $5,617

32                               -                       $5,400             $5,508            $5,617            $5,730

33                               -                                -              $5,617            $5,730            $5,845

34                               -                                -              $5,730            $5,845            $5,962

35                               -                                -                        -             $5,962            $6,081

36                               -                                -                        -             $6,081            $6,203

37                               -                                -                        -                      -             $6,327

 

2005-2006

Principal and Assistant Principal Salary Schedules

Classification

 

Yrs. of                   PrinV                  PrinVI             PrinVII           PrinVIII

Exp                       (44-54)               (55-65)          (66-100)          (101+)

 

14                   $4,298                                   -                      -                        -

15                   $4,363                                   -                      -                        -

16                   $4,428                        $4,497                      -                        -

17                   $4,497                        $4,565            $4,708                       -

18                   $4,565                        $4,638            $4,780            $4,855

19                   $4,638                        $4,708            $4,855            $4,931

20                   $4,708                        $4,780            $4,931            $5,008

21                   $4,780                        $4,855            $5,008            $5,088

22                   $4,855                        $4,931            $5,088            $5,189

23                   $4,931                        $5,008            $5,189            $5,294

24                   $5,008                        $5,088            $5,294            $5,400

25                   $5,088                        $5,189            $5,400            $5,508

26                   $5,189                        $5,294            $5,508            $5,617

27                   $5,294                        $5,400            $5,617            $5,730

28                   $5,400                        $5,508            $5,730            $5,845

29                   $5,508                        $5,617            $5,845            $5,962

30                   $5,617                        $5,730            $5,962            $6,081

31                   $5,730                        $5,845            $6,081            $6,203

32                   $5,845                        $5,962            $6,203            $6,327

33                   $5,962                        $6,081            $6,327            $6,453

34                   $6,081                        $6,203            $6,453            $6,583

35                   $6,203                        $6,327            $6,583            $6,714

36                   $6,327                        $6,453            $6,714            $6,847

37                   $6,453                        $6,583            $6,847            $6,985

38                   $6,583                        $6,714            $6,985            $7,124

39                             -                         $6,847            $7,124            $7,266

40                             -                         $6,985            $7,266            $7,412

41                             -                                   -             $7,412            $7,560

 

 

SECTION 7.2.(c)  The base salary schedule for school-based administrators shall apply only to principals and assistant principals.  The base salary schedule for the 2006-2007 fiscal year, commencing July 1, 2006, is as follows:

 

2006-2007

Principal and Assistant Principal Salary Schedules

Classification

 

Yrs. of                 Assistant                Prin I               Prin II             Prin III            Prin IV

Exp                      Principal               (0-10)            (11-21)           (22-32)          (33-43)

 

0-4                   $3,297                                -                       -                      -                      -              

5                       $3,448                                -                       -                      -                      - 

6                       $3,593                                -                       -                      -                      - 

7                       $3,709                                -                       -                      -                      - 

8                       $3,762                      $3,762                       -                      -                      - 

9                       $3,817                      $3,817                       -                      -                      - 

10                     $3,874                      $3,874             $3,930                     -                      - 

11                     $3,930                      $3,930             $3,987                     -                      - 

12                     $3,987                      $3,987             $4,044            $4,104                     - 

13                     $4,044                      $4,044             $4,104            $4,163            $4,226

14                     $4,104                      $4,104             $4,163            $4,226            $4,289

15                     $4,163                      $4,163             $4,226            $4,289            $4,353

16                     $4,226                      $4,226             $4,289            $4,353            $4,419

17                     $4,289                      $4,289             $4,353            $4,419            $4,484

18                     $4,353                      $4,353             $4,419            $4,484            $4,554

19                     $4,419                      $4,419             $4,484            $4,554            $4,623

20                     $4,484                      $4,484             $4,554            $4,623            $4,697

21                     $4,554                      $4,554             $4,623            $4,697            $4,769

22                     $4,623                      $4,623             $4,697            $4,769            $4,842

23                     $4,697                      $4,697             $4,769            $4,842            $4,917

24                     $4,769                      $4,769             $4,842            $4,917            $4,994

25                     $4,842                      $4,842             $4,917            $4,994            $5,072

26                     $4,917                      $4,917             $4,994            $5,072            $5,153

27                     $4,994                      $4,994             $5,072            $5,153            $5,256

28                     $5,072                      $5,072             $5,153            $5,256            $5,361

29                     $5,153                      $5,153             $5,256            $5,361            $5,469

30                     $5,256                      $5,256             $5,361            $5,469            $5,579

31                     $5,361                      $5,361             $5,469            $5,579            $5,689

32                               -                       $5,469             $5,579            $5,689            $5,803

33                               -                                -              $5,689            $5,803            $5,920

34                               -                                -              $5,803            $5,920            $6,039

35                               -                                -                         -            $6,039            $6,158

36                               -                                -                         -            $6,158            $6,282

37                               -                                -                         -                      -            $6,408

 

2006-2007

Principal and Assistant Principal Salary Schedules

Classification

 

Yrs. of                   PrinV                  PrinVI             PrinVII           PrinVIII

Exp                       (44-54)               (55-65)          (66-100)          (101+)

 

14                   $4,353                                  -                       -                       - 

15                   $4,419                                  -                       -                       - 

16                   $4,484                        $4,554                      -                       - 

17                   $4,554                        $4,623            $4,769                      - 

18                   $4,623                        $4,697            $4,842            $4,917

19                   $4,697                        $4,769            $4,917            $4,994

20                   $4,769                        $4,842            $4,994            $5,072

21                   $4,842                        $4,917            $5,072            $5,153

22                   $4,917                        $4,994            $5,153            $5,256

23                   $4,994                        $5,072            $5,256            $5,361

24                   $5,072                        $5,153            $5,361            $5,469

25                   $5,153                        $5,256            $5,469            $5,579

26                   $5,256                        $5,361            $5,579            $5,689

27                   $5,361                        $5,469            $5,689            $5,803

28                   $5,469                        $5,579            $5,803            $5,920

29                   $5,579                        $5,689            $5,920            $6,039

30                   $5,689                        $5,803            $6,039            $6,158

31                   $5,803                        $5,920            $6,158            $6,282

32                   $5,920                        $6,039            $6,282            $6,408

33                   $6,039                        $6,158            $6,408            $6,536

34                   $6,158                        $6,282            $6,536            $6,667

35                   $6,282                        $6,408            $6,667            $6,800

36                   $6,408                        $6,536            $6,800            $6,935

37                   $6,536                        $6,667            $6,935            $7,074

38                   $6,667                        $6,800            $7,074            $7,215

39                                                        $6,935            $7,215            $7,359

40                                                        $7,074            $7,359            $7,507

 

SECTION 7.2.(d)  The appropriate classification for placement of principals and assistant principals on the salary schedule, except for principals in alternative schools and in cooperative innovative high schools, shall be determined in accordance with the following schedule:

Number of Teachers

Classification                                         Supervised

 

Assistant Principal

Principal I                                          Fewer than 11 Teachers

Principal II                                         11-21 Teachers

Principal III                                        22-32 Teachers

Principal IV                                        33-43 Teachers

Principal V                                         44-54 Teachers

Principal VI                                        55-65 Teachers

Principal VII                                      66-100 Teachers

Principal VIII                                     More than 100 Teachers

 

The number of teachers supervised includes teachers and assistant principals paid from State funds only; it does not include teachers or assistant principals paid from non-State funds or the principal or teacher assistants.

The beginning classification for principals in alternative schools and in cooperative innovative high school programs shall be the Principal III level. Principals in alternative schools who supervise 33 or more teachers shall be classified according to the number of teachers supervised.

SECTION 7.2.(e)  A principal shall be placed on the step on the salary schedule that reflects total number of years of experience as a certificated employee of the public schools and an additional step for every three years of experience as a principal. A principal or assistant principal shall also continue to receive any additional State-funded percentage increases earned for the 1997-1998, 1998-1999, and 1999-2000 school years for improvement in student performance or maintaining a safe and orderly school.

SECTION 7.2.(f)  Principals and assistant principals with certification based on academic preparation at the six-year degree level shall be paid a salary supplement of one hundred twenty-six dollars ($126.00) per month and at the doctoral degree level shall be paid a salary supplement of two hundred fifty-three dollars ($253.00) per month.

SECTION 7.2.(g)  Longevity pay for principals and assistant principals shall be as provided for State employees under the State Personnel Act.

SECTION 7.2.(h)  If a principal is reassigned to a higher job classification because the principal is transferred to a school within a local school administrative unit with a larger number of State-allotted teachers, the principal shall be placed on the salary schedule as if the principal had served the principal's entire career as a principal at the higher job classification.

If a principal is reassigned to a lower job classification because the principal is transferred to a school within a local school administrative unit with a smaller number of State-allotted teachers, the principal shall be placed on the salary schedule as if the principal had served the principal's entire career as a principal at the lower job classification.

This subsection applies to all transfers on or after the effective date of this section, except transfers in school systems that have been created, or will be created, by merging two or more school systems. Transfers in these merged systems are exempt from the provisions of this subsection for one calendar year following the date of the merger.

SECTION 7.2.(i)  Participants in an approved full-time masters in school administration program shall receive up to a 10-month stipend at the beginning salary of an assistant principal during the internship period of the masters program.  For the 2005-2006 fiscal year and subsequent fiscal years, the stipend shall not exceed the difference between the beginning salary of an assistant principal and any fellowship funds received by the intern as a full-time student, including awards of the Principal Fellows Program. The Principal Fellows Program or the school of education where the intern participates in a full-time masters in school administration program shall supply the Department of Public Instruction with certification of eligible full-time interns.

SECTION 7.2.(j)  During the 2005-2006 fiscal year and the 2006-2007 fiscal year, the placement on the salary schedule of an administrator with a one-year provisional assistant principal's certificate shall be at the entry-level salary for an assistant principal or the appropriate step on the teacher salary schedule, whichever is higher.

 

Requested by:            Senator Lucas, Swindell, Garrou, Dalton, Hagan

CENTRAL OFFICE SALARIES

SECTION 7.3.(a)  The monthly salary ranges that follow apply to assistant superintendents, associate superintendents, directors/coordinators, supervisors, and finance officers for the 2005-2006 fiscal year, beginning July 1, 2005.

School Administrator I                     $2,932            $5,506

School Administrator II                    $3,112            $5,840

School Administrator III                  $3,303            $6,195

School Administrator IV                  $3,436            $6,442

School Administrator V                   $3,574            $6,702

School Administrator VI                  $3,792            $7,108

School Administrator VII                 $3,945            $7,394

The monthly salary ranges that follow apply to assistant superintendents, associate superintendents, directors/coordinators, supervisors, and finance officers for the 2006-2007 fiscal year, beginning July 1, 2006.

School Administrator I                     $2,932            $5,671

School Administrator II                    $3,112            $6,015

School Administrator III                  $3,303            $6,380

School Administrator IV                  $3,436            $6,636

School Administrator V                   $3,574            $6,903

School Administrator VI                  $3,792            $7,322

School Administrator VII                 $3,945            $7,616

The local board of education shall determine the appropriate category and placement for each assistant superintendent, associate superintendent, director/coordinator, supervisor, or finance officer within the salary ranges and within funds appropriated by the General Assembly for central office administrators and superintendents. The category in which an employee is placed shall be included in the contract of any employee.

SECTION 7.3.(b)  The monthly salary ranges that follow apply to public school superintendents for the 2005-2006 fiscal year, beginning July 1, 2005.

Superintendent I                                $4,187            $7,844

Superintendent II                               $4,445            $8,318

Superintendent III                              $4,716            $8,825

Superintendent IV                             $5,005            $9,360

Superintendent V                               $5,312            $9,931

The monthly salary ranges that follow apply to public school superintendents for the 2006-2007 fiscal year, beginning July 1, 2006.

Superintendent I                                $4,187            $8,080

Superintendent II                               $4,445            $8,568

Superintendent III                              $4,716            $9,090

Superintendent IV                             $5,005            $9,641

Superintendent V                               $5,312          $10,229

The local board of education shall determine the appropriate category and placement for the superintendent based on the average daily membership of the local school administrative unit and within funds appropriated by the General Assembly for central office administrators and superintendents.

SECTION 7.3.(c)  Longevity pay for superintendents, assistant superintendents, associate superintendents, directors/coordinators, supervisors, and finance officers shall be as provided for State employees under the State Personnel Act.

SECTION 7.3.(d)  Superintendents, assistant superintendents, associate superintendents, directors/coordinators, supervisors, and finance officers with certification based on academic preparation at the six-year degree level shall receive a salary supplement of one hundred twenty-six dollars ($126.00) per month in addition to the compensation provided pursuant to this section.  Superintendents, assistant superintendents, associate superintendents, directors/coordinators, supervisors, and finance officers with certification based on academic preparation at the doctoral degree level shall receive a salary supplement of two hundred fifty-three dollars ($253.00) per month in addition to the compensation provided for under this section.

SECTION 7.3.(e)  The State Board of Education shall not permit local school administrative units to transfer State funds from other funding categories for salaries for public school central office administrators.

SECTION 7.3.(f)  The annual salary increase for all permanent full-time personnel paid from the Central Office Allotment who work a nine-, 10-, 11-, or 12-month work year schedule shall be the greater of five hundred dollars ($500.00) or two percent (2%), commencing July 1, 2005. The annual salary increase for all permanent full-time personnel paid from the Central Office Allotment who work a nine-, 10-, 11-, or 12-month work year schedule shall be the three percent (3%), commencing July 1, 2006. The State Board of Education shall allocate these funds to local school administrative units.  The local boards of education shall establish guidelines for providing salary increases to these personnel.

 

Requested by:            Senator Lucas, Swindell, Garrou, Dalton, Hagan

NONCERTIFIED PERSONNEL SALARY

SECTION 7.4.(a)  The annual salary increase for permanent, full-time noncertified public school employees whose salaries are supported from the State's General Fund shall be the greater of five hundred dollars ($500.00) or two percent (2%), commencing July 1, 2005.

The annual salary increase for permanent, full-time noncertified public school employees whose salaries are supported from the State's General Fund shall be three percent (3%), commencing July 1, 2006.

SECTION 7.4.(b)  Local boards of education shall increase the rates of pay for such employees who were employed for all or part of fiscal year 2004-2005 and who continue their employment for fiscal year 2005-2006 by providing an annual salary increase for employees of the greater of five hundred dollars ($500.00) or two percent (2%).

Local boards of education shall increase the rates of pay for such employees who were employed for all or part of fiscal year 2005-2006 and who continue their employment for fiscal year 2006-2007 by providing an annual salary increase for employees of three percent (3%).

For part-time employees, the pay increase shall be pro rata based on the number of hours worked.

SECTION 7.4.(c)  The State Board of Education may adopt salary ranges for noncertified personnel to support increases of the greater of five hundred dollars ($500.00) or two percent (2%) for the 2005-2006 fiscal year.

The State Board of Education may adopt salary ranges for noncertified personnel to support increases of three percent (3%) for the 2006-2007 fiscal year.

SECTION 7.4.(d)  For the 2005-2006 fiscal year, permanent full-time employees who work a nine-, 10-, or 11-month work year schedule shall receive the five hundred dollars ($500.00) or the two percent (2%) annual increase provided by this act, whichever is greater.

For the 2006-2007 fiscal year, permanent full-time employees who work a nine-, 10-, or 11-month work year schedule shall receive the three percent (3%) annual increase provided by this act.

 

 

Requested by:            Senator Lucas, Swindell, Garrou, Dalton, Hagan

bonus for certified personnel at the top of their salary schedules

SECTION 7.5.  Effective July 1, 2005, any permanent certified personnel employed on July 1, 2003, and paid on the teacher salary schedule with 29+ years of experience shall receive a one-time bonus equivalent to the average increase of the 26 to 29 year steps.  Effective July 1, 2005, any permanent personnel employed on July 1, 2004, and paid at the top of the principal and assistant principal salary schedule shall receive a one-time bonus equivalent to two percent (2%).

Effective July 1, 2006, any permanent certified personnel employed on July 1, 2003, and paid on the teacher salary schedule with 29+ years of experience shall receive a one-time bonus equivalent to the average increase of the 26 to 29 year steps. Effective July 1, 2006, any permanent personnel employed on July 1, 2005, and paid at the top of the principal and assistant principal salary schedule shall receive a one-time bonus equivalent to two percent (2%).

For permanent part-time personnel, the one-time bonus shall be adjusted pro rata. Personnel defined under G.S. 115C-325(a)(5a) are not eligible to receive the bonus.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

SUPPLEMENTAL FUNDING IN LOW-WEALTH COUNTIES

SECTION 7.6.(a)  Funds for Supplemental Funding. - The General Assembly finds that it is appropriate to provide supplemental funds in low-wealth counties to allow those counties to enhance the instructional program and student achievement.  Therefore, funds are appropriated to State Aid to Local School Administrative Units for the 2005-2006 fiscal year and the 2006-2007 fiscal year to be used for supplemental funds for the schools.

SECTION 7.6.(b)  Use of Funds for Supplemental Funding. - All funds received pursuant to this section shall be used only:  (i) to provide instructional positions, instructional support positions, teacher assistant positions, clerical positions, school computer technicians, instructional supplies and equipment, staff development, and textbooks; (ii) for salary supplements for instructional personnel and instructional support personnel; and (iii) to pay an amount not to exceed ten thousand dollars ($10,000) of the plant operation contract cost charged by the Department of Public Instruction for services.

Local boards of education are encouraged to use at least twenty-five percent (25%) of the funds received pursuant to this section to improve the academic performance of children who are performing at Level I or II on either reading or mathematics end-of-grade tests in grades 3-8 and children who are performing at Level I or II on the writing tests in grades 4 and 7. Local boards of education shall report to the State Board of Education on an annual basis on funds used for this purpose, and the State Board shall report this information to the Joint Legislative Education Oversight Committee. These reports shall specify how these funds were targeted and used to implement specific improvement strategies of each local school administrative unit and its schools, such as teacher recruitment, closing the achievement gap, improving student accountability, addressing the needs of at-risk students, and establishing and maintaining safe schools.

SECTION 7.6.(c)  Definitions. - As used in this section:

(1)       "Anticipated county property tax revenue availability" means the county-adjusted property tax base multiplied by the effective State average tax rate.

(2)       "Anticipated total county revenue availability" means the sum of the:

a.         Anticipated county property tax revenue availability,

b.         Local sales and use taxes received by the county that are levied under Chapter 1096 of the 1967 Session Laws or under Subchapter VIII of Chapter 105 of the General Statutes,

c.         Sales tax hold harmless reimbursement received by the county under G.S. 105-521, and

d.         Fines and forfeitures deposited in the county school fund for the most recent year for which data are available.

(3)       "Anticipated total county revenue availability per student" means the anticipated total county revenue availability for the county divided by the average daily membership of the county.

(4)       "Anticipated State average revenue availability per student" means the sum of all anticipated total county revenue availability divided by the average daily membership for the State.

(5)       "Average daily membership" means average daily membership as defined in the North Carolina Public Schools Allotment Policy Manual, adopted by the State Board of Education. If a county contains only part of a local school administrative unit, the average daily membership of that county includes all students who reside within the county and attend that local school administrative unit.

(6)       "County-adjusted property tax base" shall be computed as follows:

a.         Subtract the present-use value of agricultural land, horticultural land, and forestland in the county, as defined in G.S. 105-277.2, from the total assessed real property valuation of the county,

b.         Adjust the resulting amount by multiplying by a weighted average of the three most recent annual sales assessment ratio studies,

c.         Add to the resulting amount the:

1.         Present-use value of agricultural land, horticultural land, and forestland, as defined in G.S. 105-277.2,

2.         Value of property of public service companies, determined in accordance with Article 23 of Chapter 105 of the General Statutes, and

3.         Personal property value for the county.

(7)       "County-adjusted property tax base per square mile" means the county-adjusted property tax base divided by the number of square miles of land area in the county.

(8)       "County wealth as a percentage of State average wealth" shall be computed as follows:

a.         Compute the percentage that the county per capita income is of the State per capita income and weight the resulting percentage by a factor of five-tenths,

b.         Compute the percentage that the anticipated total county revenue availability per student is of the anticipated State average revenue availability per student and weight the resulting percentage by a factor of four-tenths,

c.         Compute the percentage that the county-adjusted property tax base per square mile is of the State-adjusted property tax base per square mile and weight the resulting percentage by a factor of one-tenth,

d.         Add the three weighted percentages to derive the county wealth as a percentage of the State average wealth.

(9)       "Effective county tax rate" means the actual county tax rate multiplied by a weighted average of the three most recent annual sales assessment ratio studies.

(10)     "Effective State average tax rate" means the average of effective county tax rates for all counties.

(10a)   "Local current expense funds" means the most recent county current expense appropriations to public schools, as reported by local boards of education in the audit report filed with the Secretary of the Local Government Commission pursuant to G.S. 115C-447.

(11)     "Per capita income" means the average for the most recent three years for which data are available of the per capita income according to the most recent report of the United States Department of Commerce, Bureau of Economic Analysis, including any reported modifications for prior years as outlined in the most recent report.

(12)     "Sales assessment ratio studies" means sales assessment ratio studies performed by the Department of Revenue under G.S. 105-289(h).

(13)     "State average current expense appropriations per student" means the most recent State total of county current expense appropriations to public schools, as reported by local boards of education in the audit report filed with the Secretary of the Local Government Commission pursuant to G.S. 115C-447.

(14)     "State average adjusted property tax base per square mile" means the sum of the county-adjusted property tax bases for all counties divided by the number of square miles of land area in the State.

(14a)   "Supplant" means to decrease local per student current expense appropriations from one fiscal year to the next fiscal year.

(15)     "Weighted average of the three most recent annual sales assessment ratio studies" means the weighted average of the three most recent annual sales assessment ratio studies in the most recent years for which county current expense appropriations and adjusted property tax valuations are available. If real property in a county has been revalued one year prior to the most recent sales assessment ratio study, a weighted average of the two most recent sales assessment ratios shall be used. If property has been revalued the year of the most recent sales assessment ratio study, the sales assessment ratio for the year of revaluation shall be used.

SECTION 7.6.(d)  Eligibility for Funds. - Except as provided in subsection (h) of this section, the State Board of Education shall allocate these funds to local school administrative units located in whole or in part in counties in which the county wealth as a percentage of the State average wealth is less than one hundred percent (100%).

SECTION 7.6.(e)  Allocation of Funds. - Except as provided in subsection (g) of this section, the amount received per average daily membership for a county shall be the difference between the State average current expense appropriations per student and the current expense appropriations per student that the county could provide given the county's wealth and an average effort to fund public schools.  (To derive the current expense appropriations per student that the county could be able to provide given the county's wealth and an average effort to fund public schools, multiply the county wealth as a percentage of State average wealth by the State average current expense appropriations per student.)

The funds for the local school administrative units located in whole or in part in the county shall be allocated to each local school administrative unit located in whole or in part in the county based on the average daily membership of the county's students in the school units.

If the funds appropriated for supplemental funding are not adequate to fund the formula fully, each local school administrative unit shall receive a pro rata share of the funds appropriated for supplemental funding.

SECTION 7.6.(f)  Formula for Distribution of Supplemental Funding Pursuant to This Section Only. - The formula in this section is solely a basis for distribution of supplemental funding for low-wealth counties and is not intended to reflect any measure of the adequacy of the educational program or funding for public schools.  The formula is also not intended to reflect any commitment by the General Assembly to appropriate any additional supplemental funds for low-wealth counties.

SECTION 7.6.(g)  Minimum Effort Required. - Counties that had effective tax rates in the 1996-1997 fiscal year that were above the State average effective tax rate but that had effective rates below the State average in the 1997-1998 fiscal year or thereafter shall receive reduced funding under this section.  This reduction in funding shall be determined by subtracting the amount that the county would have received pursuant to Section 17.1(g) of Chapter 507 of the 1995 Session Laws from the amount that the county would have received if qualified for full funding and multiplying the difference by ten percent (10%).  This method of calculating reduced funding shall apply one time only.

This method of calculating reduced funding shall not apply in cases in which the effective tax rate fell below the statewide average effective tax rate as a result of a reduction in the actual property tax rate. In these cases, the minimum effort required shall be calculated in accordance with Section 17.1(g) of Chapter 507 of the 1995 Session Laws.

If the county documents that it has increased the per student appropriation to the school current expense fund in the current fiscal year, the State Board of Education shall include this additional per pupil appropriation when calculating minimum effort pursuant to Section 17.1(g) of Chapter 507 of the 1995 Session Laws.

SECTION 7.6.(h)  Nonsupplant Requirement. - A county in which a local school administrative unit receives funds under this section shall use the funds to supplement local current expense funds and shall not supplant local current expense funds. For the 2005-2007 fiscal biennium, the State Board of Education shall not allocate funds under this section to a county found to have used these funds to supplant local per student current expense funds.  The State Board of Education shall make a finding that a county has used these funds to supplant local current expense funds in the prior year, or the year for which the most recent data are available, if:

(1)       The current expense appropriation per student of the county for the current year is less than ninety-five percent (95%) of the average of the local current expense appropriations per student for the three prior fiscal years; and

(2)       The county cannot show:  (i) that it has remedied the deficiency in funding or (ii) that extraordinary circumstances caused the county to supplant local current expense funds with funds allocated under this section.

The State Board of Education shall adopt rules to implement this section.

SECTION 7.6.(i)  Reports. - The State Board of Education shall report to the Joint Legislative Education Oversight Committee prior to May 1, 2006, if it determines that counties have supplanted funds.

SECTION 7.6.(j)  Department of Revenue Reports. - The Department of Revenue shall provide to the Department of Public Instruction a preliminary report for the current fiscal year of the assessed value of the property tax base for each county prior to March 1 of each year and a final report prior to May 1 of each year.  The reports shall include for each county the annual sales assessment ratio and the taxable values of (i) total real property, (ii) the portion of total real property represented by the present-use value of agricultural land, horticultural land, and forestland as defined in G.S. 105-277.2, (iii) property of public service companies determined in accordance with Article 23 of Chapter 105 of the General Statutes, and (iv) personal property.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

SMALL SCHOOL SYSTEM SUPPLEMENTAL FUNDING

SECTION 7.7.(a)  Funds for Small School Systems. - Except as provided in subsection (b) of this section, the State Board of Education shall allocate funds appropriated for small school system supplemental funding (i) to each county school administrative unit with an average daily membership of fewer than 3,175 students and (ii) to each county school administrative unit with an average daily membership from 3,175 to 4,000 students if the county in which the local school administrative unit is located has a county-adjusted property tax base per student that is below the State-adjusted property tax base per student and if the total average daily membership of all local school administrative units located within the county is from 3,175 to 4,000 students. The allocation formula shall:

(1)       Round all fractions of positions to the next whole position.

(2)       Provide five and one-half additional regular classroom teachers in counties in which the average daily membership per square mile is greater than four, and seven additional regular classroom teachers in counties in which the average daily membership per square mile is four or fewer.

(3)       Provide additional program enhancement teachers adequate to offer the standard course of study.

(4)       Change the duty-free period allocation to one teacher assistant per 400 average daily membership.

(5)       Provide a base for the consolidated funds allotment of at least seven hundred forty thousand seventy-four dollars ($740,074), excluding textbooks for the 2005-2006 fiscal year and a base of seven hundred forty thousand seventy-four dollars ($740,074) for the 2006-2007 fiscal year.

(6)       Allot vocational education funds for grade 6 as well as for grades 7-12.

If funds appropriated for each fiscal year for small school system supplemental funding are not adequate to fully fund the program, the State Board of Education shall reduce the amount allocated to each county school administrative unit on a pro rata basis. This formula is solely a basis for distribution of supplemental funding for certain county school administrative units and is not intended to reflect any measure of the adequacy of the educational program or funding for public schools. The formula is also not intended to reflect any commitment by the General Assembly to appropriate any additional supplemental funds for such county administrative units.

SECTION 7.7.(b)  Nonsupplant Requirement. - A county in which a local school administrative unit receives funds under this section shall use the funds to supplement local current expense funds and shall not supplant local current expense funds. For the 2005-2007 fiscal biennium, the State Board of Education shall not allocate funds under this section to a county found to have used these funds to supplant local per student current expense funds.  The State Board of Education shall make a finding that a county has used these funds to supplant local current expense funds in the prior year, or the year for which the most recent data are available, if:

(1)       The current expense appropriation per student of the county for the current year is less than ninety-five percent (95%) of the average of the local current expense appropriations per student for the three prior fiscal years; and

(2)       The county cannot show:  (i) that it has remedied the deficiency in funding or (ii) that extraordinary circumstances caused the county to supplant local current expense funds with funds allocated under this section.

The State Board of Education shall adopt rules to implement this section.

SECTION 7.7.(c)  Phase-Out Provisions. - If a local school administrative unit becomes ineligible for funding under this formula solely because of an increase in the county-adjusted property tax base per student of the county in which the local school administrative unit is located, funding for that unit shall be phased out over a two-year period.  For the first year of ineligibility, the unit shall receive the same amount it received for the prior fiscal year. For the second year of ineligibility, it shall receive one-half of that amount.

If a local school administrative unit becomes ineligible for funding under this formula solely because of an increase in the population of the county in which the local school administrative unit is located, funding for that unit shall be continued for five years after the unit becomes ineligible.

SECTION 7.7.(d)  Definitions. - As used in this section:

(1)       "Average daily membership" means within two percent (2%) of the average daily membership as defined in the North Carolina Public Schools Allotment Policy Manual adopted by the State Board of Education.

(2)       "County-adjusted property tax base per student" means the total assessed property valuation for each county, adjusted using a weighted average of the three most recent annual sales assessment ratio studies, divided by the total number of students in average daily membership who reside within the county.

(2a)     "Local current expense funds" means the most recent county current expense appropriations to public schools, as reported by local boards of education in the audit report filed with the Secretary of the Local Government Commission pursuant to G.S. 115C-447.

(3)       "Sales assessment ratio studies" means sales assessment ratio studies performed by the Department of Revenue under G.S. 105-289(h).

(4)       "State-adjusted property tax base per student" means the sum of all county-adjusted property tax bases divided by the total number of students in average daily membership who reside within the State.

(4a)     "Supplant" means to decrease local per student current expense appropriations from one fiscal year to the next fiscal year.

(5)       "Weighted average of the three most recent annual sales assessment ratio studies" means the weighted average of the three most recent annual sales assessment ratio studies in the most recent years for which county current expense appropriations and adjusted property tax valuations are available. If real property in a county has been revalued one year prior to the most recent sales assessment ratio study, a weighted average of the two most recent sales assessment ratios shall be used. If property has been revalued during the year of the most recent sales assessment ratio study, the sales assessment ratio for the year of revaluation shall be used.

SECTION 7.7.(e)  Reports. - The State Board of Education shall report to the Joint Legislative Education Oversight Committee prior to May 1, 2006, if it determines that counties have supplanted funds.

SECTION 7.7.(f)  Use of Funds. - Local boards of education are encouraged to use at least twenty percent (20%) of the funds they receive pursuant to this section to improve the academic performance of children who are performing at Level I or II on either reading or mathematics end-of-grade tests in grades 3-8 and children who are performing at Level I or II on the writing tests in grades 4 and 7.  Local boards of education shall report to the State Board of Education on an annual basis on funds used for this purpose, and the State Board shall report this information to the Joint Legislative Education Oversight Committee.  These reports shall specify how these funds were targeted and used to implement specific improvement strategies of each local school administrative unit and its schools such as teacher recruitment, closing the achievement gap, improving student accountability, addressing the needs of at-risk students, and establishing and maintaining safe schools.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

disadvantaged student supplemental funding

SECTION 7.8.(a)  Funds are appropriated in this act to address the capacity needs of local school administrative units to meet the needs of disadvantaged students.  Each local school administrative unit shall use funds allocated to it for disadvantaged student supplemental funding to implement a plan jointly developed by the unit and the LEA Assistance Program team.  The plan shall be based upon the needs of students in the unit not achieving grade-level proficiency. The plan shall detail how these funds shall be used in conjunction with all other supplemental funding allotments such as Low-Wealth, Small County, At-Risk Student Services/Alternative Schools, and Improving Student Accountability, to provide instructional and other services that meet the educational needs of these students. Prior to the allotment of disadvantaged student supplemental funds, the plan shall be approved by the State Board of Education.

Funds received for disadvantaged student supplemental funding shall be used, consistent with the policies and procedures adopted by the State Board of Education, only to:

(1)       Provide instructional positions or instructional support positions and/or professional development;

(2)       Provide intensive in-school and/or after-school remediation;

(3)       Purchase diagnostic software and progress-monitoring tools; and

(4)       Provide funds for teacher bonuses and supplements. The State Board of Education shall set a maximum percentage of the funds that may be used for this purpose.

SECTION 7.8.(b)  Funds are appropriated in this act to evaluate the Disadvantaged Students Supplemental Funding Initiatives and Low-Wealth Initiatives. The State Board of Education shall use these funds to:

(1)       Evaluate the strategies implemented by local school administrative units with Disadvantaged Student Supplemental Funds and Low-Wealth Funds and assess their impact on student performance; and

(2)       Evaluate the efficiency and effectiveness of the technical assistance and support provided to local school administrative units by the Department of Public Instruction.

The State Board of Education shall report the results of the evaluation to the Office of State Budget and Management, the Joint Legislative Education Oversight Committee, and the Fiscal Research Division by February 15, 2006, and by January 15 of each subsequent year.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

students with limited english proficiency

SECTION 7.9.(a)  The State Board of Education shall develop guidelines for identifying and providing services to students with limited proficiency in the English language.

The State Board shall allocate these funds to local school administrative units and to charter schools under a formula that takes into account the average percentage of students in the units or the charters over the past three years who have limited English proficiency. The State Board shall allocate funds to a unit or a charter school only if (i) average daily membership of the unit or the charter school includes at least 20 students with limited English proficiency or (ii) students with limited English proficiency comprise at least two and one-half percent (2.5%) of the average daily membership of the unit or charter school. For the portion of the funds that is allocated on the basis of the number of identified students, the maximum number of identified students for whom a unit or charter school receives funds shall not exceed ten and six-tenths percent (10.6%) of its average daily membership.

Local school administrative units shall use funds allocated to them to pay for classroom teachers, teacher assistants, tutors, textbooks, classroom materials/instructional supplies/equipment, transportation costs, and staff development of teachers for students with limited English proficiency.

A county in which a local school administrative unit receives funds under this section shall use the funds to supplement local current expense funds and shall not supplant local current expense funds.

SECTION 7.9.(b)  The Department of Public Instruction shall prepare a current head count of the number of students classified with limited English proficiency by December 1 of each year.

Students in the head count shall be assessed at least once every three years to determine their level of English proficiency. A student who scores "superior" on the standard English language proficiency assessment instrument used in this State shall not be included in the head count of students with limited English proficiency.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

flexibility for the highest priority elementary schools

SECTION 7.10.  The State Board of Education may allow high priority schools that have made high growth for three consecutive years to be removed from the list of high priority schools.  If a local board of education chooses to have a school removed from the list of high priority schools, the additional high priority funding for that school shall be discontinued.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

AT-RISK STUDENT SERVICES/ALTERNATIVE SCHOOLS

SECTION 7.11.  The State Board of Education may use up to two hundred thousand dollars ($200,000) of the funds in the Alternative Schools/At-Risk Student allotment each year for the 2005-2006 fiscal year and for the 2006-2007 fiscal year to implement G.S. 115C-12(24).

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

funds for CHILDREN WITH DISABILITIES

SECTION 7.12.  The State Board of Education shall allocate funds for children with disabilities on the basis of two thousand eight hundred thirty-eight dollars and thirty-nine cents ($2,838.39) per child for a maximum of 169,164 children for the 2005-2006 school year.  Each local school administrative unit shall receive funds for the lesser of (i) all children who are identified as children with disabilities or (ii) twelve and five-tenths percent (12.5%) of the 2005-2006 allocated average daily membership in the local school administrative unit.

The dollar amounts allocated under this section for children with disabilities shall also adjust in accordance with legislative salary increments, retirement rate adjustments, and health benefit adjustments for personnel who serve children with disabilities.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

funds for academically gifted children

SECTION 7.13.  The State Board of Education shall allocate funds for academically or intellectually gifted children on the basis of nine hundred twenty-six dollars and fifty-five cents ($926.55) per child. A local school administrative unit shall receive funds for a maximum of four percent (4%) of its 2005-2006 allocated average daily membership, regardless of the number of children identified as academically or intellectually gifted in the unit. The State Board shall allocate funds for no more than 55,895 children for the 2005-2006 school year.

The dollar amounts allocated under this section for academically or intellectually gifted children shall also adjust in accordance with legislative salary increments, retirement rate adjustments, and health benefit adjustments for personnel who serve academically or intellectually gifted children.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

EXPENDITURE OF FUNDS TO IMPROVE STUDENT ACCOUNTABILITY

SECTION 7.14.(a)  Funds appropriated for the 2005-2006 and 2006-2007 fiscal years for Student Accountability Standards shall be used to assist students to perform at or above grade level in reading and mathematics in grades 3-8 as measured by the State's end-of-grade tests. The State Board of Education shall allocate these funds to LEAs based on the number of students who score at Level I or Level II on either reading or mathematics end-of-grade tests in grades 3-8. Funds in the allocation category shall be used to improve the academic performance of (i) students who are performing at Level I or II on either reading or mathematics end-of-grade tests in grades 3-8 or (ii) students who are performing at Level I or II on the writing tests in grades 4 and 7. These funds may also be used to improve the academic performance of students who are performing at Level I or II on the high school end-of-course tests. These funds shall not be transferred to other allocation categories or otherwise used for other purposes.  Except as otherwise provided by law, local boards of education may transfer other funds available to them into this allocation category.

The principal of a school receiving these funds, in consultation with the faculty and the site-based management team, shall implement plans for expending these funds to improve the performance of students.

Local boards of education are encouraged to use federal funds such as Title I Comprehensive School Reform Development Funds and to examine the use of State funds to ensure that every student is performing at or above grade level in reading and mathematics.

These funds shall be allocated to local school administrative units for the 2005-2006 fiscal year within 30 days of the date this act becomes law.

SECTION 7.14.(b)  Funds appropriated for Student Accountability Standards shall not revert at the end of each fiscal year but shall remain available for expenditure until August 31 of the subsequent fiscal year.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

LITIGATION RESERVE FUNDS

SECTION 7.15.  The State Board of Education may expend up to five hundred thousand dollars ($500,000) each year for the 2005-2006 and 2006-2007 fiscal years from unexpended funds for certified employees' salaries to pay expenses related to pending litigation.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

BASE BUDGET REDUCTION TO DEPARTMENT OF PUBLIC INSTRUCTION

SECTION 7.16.  Notwithstanding any other provision of law, the Department of Public Instruction may use salary reserve funds and other funds and may transfer funds within the Department's continuation budget to implement budget reductions for the 2005-2006 fiscal year.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

REPLACEMENT SCHOOL BUSES FUNDS

SECTION 7.17.(a)  The State Board of Education may impose any of the following conditions on allotments to local boards of education for replacement school buses:

(1)       The local board of education shall use the funds only to make the first, second, or third year's payment on a financing contract entered into pursuant to G.S. 115C-528.

(2)       The term of a financing contract entered into under this section shall not exceed three years.

(3)       The local board of education shall purchase the buses only from vendors selected by the State Board of Education and on terms approved by the State Board of Education.

(4)       The Department of Administration, Division of Purchase and Contract, in cooperation with the State Board of Education, shall solicit bids for the direct purchase of school buses and activity buses and shall establish a statewide term contract for use by the State Board of Education. Local boards of education and other agencies shall be eligible to purchase from the statewide term contract. The State Board of Education shall also solicit bids for the financing of school buses.

(5)       A bus financed pursuant to this section shall meet all federal motor vehicle safety regulations for school buses.

(6)       Any other condition the State Board of Education considers appropriate.

SECTION 7.17.(b)  Any term contract for the purchase or lease-purchase of school buses or school activity buses shall not require vendor payment of the electronic procurement transaction fee of the North Carolina E-Procurement Service.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

expenditures for driving eligibility certificates

SECTION 7.18.  G.S. 115C-12(28) reads as rewritten:

" 115C-12.  Powers and duties of the Board generally.

The general supervision and administration of the free public school system shall be vested in the State Board of Education. The State Board of Education shall establish policy for the system of free public schools, subject to laws enacted by the General Assembly. The powers and duties of the State Board of Education are defined as follows:

(28)     Duty to Develop Rules for Issuance of Driving Eligibility Certificates. - The State Board of Education shall adopt the following rules to assist schools in their administration of procedures necessary to implement G.S. 20-11 and G.S. 20-13.2:

a.         To define what is equivalent to a high school diploma for the purposes of G.S. 20-11 and G.S. 20-13.2. These rules shall apply to all educational programs offered in the State by public schools, charter schools, nonpublic schools, or community colleges.

b.         To establish the procedures a person who is or was enrolled in a public school or in a charter school must follow and the requirements that person shall meet to obtain a driving eligibility certificate.

c.         To require the person who is required under G.S. 20-11(n) to sign the driving eligibility certificate to provide the certificate if he or she determines that one of the following requirements is met:

1.         The person seeking the certificate is eligible for the certificate under G.S. 20-11(n)(1) and is not subject to G.S. 20-11(n1).

2.         The person seeking the certificate is eligible for the certificate under G.S. 20-11(n)(1) and G.S. 20-11(n1).

These rules shall apply to public schools and charter schools.

d.         To provide for an appeal to an appropriate education authority by a person who is denied a driving eligibility certificate. These rules shall apply to public schools and charter schools.

e.         To define exemplary student behavior and to define what constitutes the successful completion of a drug or alcohol treatment counseling program. These rules shall apply to public schools and charter schools.

The State Board also shall develop policies as to when it is appropriate to notify the Division of Motor Vehicles that a person who is or was enrolled in a public school or in a charter school no longer meets the requirements for a driving eligibility certificate.

The State Board shall develop a form for parents, guardians, or emancipated juveniles, as appropriate, to provide their written, irrevocable consent for a school to disclose to the Division of Motor Vehicles that the student no longer meets the conditions for a driving eligibility certificate under G.S. 20-11(n)(1) or G.S. 20-11(n1), if applicable, in the event that this disclosure is necessary to comply with G.S. 20-11 or G.S. 20-13.2. Other than identifying under which statutory subsection the student is no longer eligible, no other details or information concerning the student's school record shall be released pursuant to this consent. This form shall be used for students enrolled in public schools or charter schools.

The State Board of Education may use funds appropriated for drivers education to cover the costs of driving eligibility certificates."

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

discrepancies between anticipated and actual adm

SECTION 7.19.(a)  If the State Board of Education does not have sufficient resources in the ADM Contingency Reserve line item to make allotment adjustments in accordance with the Allotment Adjustments for ADM Growth provisions of the North Carolina Public Schools Allotment Policy Manual, the State Board of Education may use funds appropriated to State Aid for Public Schools for this purpose.

SECTION 7.19.(b)  If the higher of the first or second month average daily membership in a local school administrative unit is at least two percent (2%) or 100 students lower than the anticipated average daily membership used for allotments for the unit, the State Board of Education shall reduce allotments for the unit.  The reduced allotments shall be based on the higher of the first or second month average daily membership plus one-half of the number of students overestimated in the anticipated average daily membership.

The allotments reduced pursuant to this subsection shall include only those allotments that may be increased pursuant to the Allotment Adjustments for ADM Growth provisions of the North Carolina Public Schools Allotment Policy Manual.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

CHARTER SCHOOL ADVISORY COMMITTEE/CHARTER SCHOOL EVALUATION

SECTION 7.20.  The State Board of Education may spend up to fifty thousand dollars ($50,000) a year from State Aid to Local School Administrative Units for the 2005-2006 and 2006-2007 fiscal years to continue support of a charter school advisory committee and to continue to evaluate charter schools.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

mentor teacher funds may be used for full-time mentors

SECTION 7.21.(a)  The State Board of Education shall grant flexibility to a local board of education regarding the use of mentor funds to provide mentoring support, provided the local board submits a detailed plan on the use of the funds to the State Board and the State Board approves that plan. The plan shall include information on how all mentors in the local school administrative unit have been or will be adequately trained to provide mentoring support.

Local boards of education shall use funds allocated for mentor teachers to provide mentoring support to all State-paid newly certified teachers, second-year teachers who were assigned mentors during the prior school year, and entry-level instructional support personnel who have not previously been teachers.

SECTION 7.21.(b)  The State Board, after consultation with the Professional Teaching Standards Commission, shall adopt standards for mentor training.

SECTION 7.21.(c)  Each local board of education with a plan approved pursuant to subsection (a) of this section shall report to the State Board on the impact of its mentor program on teacher retention.  The State Board shall analyze these reports to determine the characteristics of mentor programs that are most effective in retaining teachers and shall report its findings to the Joint Legislative Education Oversight Committee by October 15, 2006.

SECTION 7.21.(d)  In addition to the report required in subsection (c) of this section, the State shall also evaluate the effectiveness of a representative sample of local mentor programs and report on its findings to the Joint Legislative Education Oversight Committee and the Fiscal Research Division by December 15, 2006.   The evaluation shall focus on quantitative evidence, quality of service delivery, and satisfaction of those involved.  The report shall include the results of the evaluation and recommendations both for improving mentor programs generally and for an appropriate level of State support for mentor programs.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

visiting international exchange teachers

SECTION 7.22.(a)  G.S. 115C-105.25(b) is amended by adding a new subdivision to read:

"(5a)    Positions allocated for classroom teachers may be converted to dollar equivalents to contract for visiting international exchange teachers. These positions shall be converted at the statewide average salary for classroom teachers, including benefits. The converted funds shall be used only to cover the costs associated with bringing visiting international exchange teachers to the local school administrative unit through a State-approved visiting international exchange teacher program and supporting the visiting exchange teachers."

SECTION 7.22.(b)  The Visiting International Faculty Program is a State-approved visiting international exchange teacher program.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

FUNDS TO IMPLEMENT THE ABCS OF PUBLIC EDUCATION

SECTION 7.23.(a)  The State Board of Education shall use funds appropriated in this act for State Aid to Local School Administrative Units to provide incentive funding for schools that met or exceeded the projected levels of improvement in student performance during the 2004-2005 school year, in accordance with the ABCs of Public Education Program.  In accordance with State Board of Education policy:

(1)       Incentive awards in schools that achieve higher than expected improvements may be:

a.         Up to one thousand five hundred dollars ($1,500) for each teacher and for certified personnel; and

b.         Up to five hundred dollars ($500.00) for each teacher assistant.

(2)       Incentive awards in schools that meet the expected improvements may be:

a.         Up to seven hundred fifty dollars ($750.00) for each teacher and for certified personnel; and

b.         Up to three hundred seventy-five dollars ($375.00) for each teacher assistant.

SECTION 7.23.(b)  The State Board of Education may use funds appropriated to the State Public School Fund for assistance teams to low-performing schools.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

LEA ASSISTANCE PROGRAM

SECTION 7.24.  Of the funds appropriated to the State Public School Fund, the State Board of Education shall use five hundred thousand dollars ($500,000) for the 2005-2006 fiscal year and five hundred thousand dollars ($500,000) for the 2006-2007 fiscal year to provide assistance to the State's low-performing Local School Administrative Units (LEAs) and to assist schools in meeting adequate yearly progress in each subgroup identified in the No Child Left Behind Act of 2001. The State Board of Education shall report to the Office of State Budget and Management, the Fiscal Research Division, and the Joint Legislative Education Oversight Committee on the expenditure of these funds by May 15, 2006, and by December 15, 2007. The report shall contain: (i) the criteria for selecting LEAs and schools to receive assistance, (ii) measurable goals and objectives for the assistance program, (iii) an explanation of the assistance provided, (iv) findings from the assistance program, (v) actual expenditures by category, (vi) recommendations for the continuance of this program, and (vii) any other information the State Board deems necessary. These funds shall not revert at the end of each fiscal year but shall remain available until expended for this purpose.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

FUNDS FOR THE TESTING AND IMPLEMENTATION OF THE NEW STUDENT INFORMATION SYSTEM

SECTION 7.25.(a)  Funds appropriated for the Uniform Education Reporting System shall not revert at the end of the 2005-2006 and 2006-2007 fiscal years but shall remain available until expended.

SECTION 7.25.(b)  This section becomes effective June 30, 2005.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

PUBLIC SCHOOL BUILDING CAPITAL and technology FUND

SECTION 7.26.(a)  The title of Article 38A of Chapter 115C of the General Statutes reads as rewritten:

"Article 38A.

Public School Building Capital and Technology Fund."

SECTION 7.26.(b)  G.S. 115C-546.1 is amended by deleting the language "Public School Building Capital Fund" wherever it appears and substituting "Public School Building Capital and Technology Fund".

SECTION 7.26.(c)  Notwithstanding the provisions of G.S. 115C-546.1(b), as rewritten by subsection (b) of this section, for the third and fourth quarters of the 2005-2006 fiscal year only, the Secretary of Revenue shall remit to the State Treasurer an amount equal to five sixty-ninths of the net collections received during the previous quarter by the Department of Revenue under G.S. 105-130.3. Of these funds, twenty-five million dollars ($25,000,000) each quarter shall be for credit to the State Public School Fund, and the remainder shall be for credit to the Public School Building Capital and Technology Fund.

The State Treasurer shall remit funds for credit to the Public School Building Capital and Technology Fund for the first and second quarters of the 2005-2006 fiscal year in accordance with G.S. 115C-546.1(b).

SECTION 7.26.(d)  Notwithstanding the provisions of G.S. 115C-546.1(b), as rewritten by subsection (b) of this section, for the first and second quarters of the 2006-2007 fiscal year only, the Secretary of Revenue shall remit to the State Treasurer an amount equal to five sixty-ninths of the net collections received during the previous quarter by the Department of Revenue under G.S. 105-130.3. Of these funds, twenty million five hundred thousand dollars ($20,500,000) each quarter shall be for credit to the State Public School Fund, and the remainder shall be for credit to the Public School Building Capital and Technology Fund.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

LEA Sales Tax Refund Reporting

SECTION 7.27.(a)  G.S. 105-164.14(c) reads as rewritten:

"(c)      Certain Governmental Entities. - A governmental entity listed in this subsection is allowed an annual refund of sales and use taxes paid by it under this Article on direct purchases of tangible personal property and services, other than electricity and telecommunications service. Sales and use tax liability indirectly incurred by a governmental entity on building materials, supplies, fixtures, and equipment that become a part of or annexed to any building or structure that is owned or leased by the governmental entity and is being erected, altered, or repaired for use by the governmental entity is considered a sales or use tax liability incurred on direct purchases by the governmental entity for the purpose of this subsection. A request for a refund must be in writing and must include any information and documentation required by the Secretary. A request for a refund is due within six months after the end of the governmental entity's fiscal year. The Secretary shall make an annual report to the Department of Public Instruction and the Fiscal Research Division of the General Assembly by January 1 of the amount of refunds, identified by taxpayer, claimed under subdivisions (2b) and (2c) of this subsection over the preceding year.

This subsection applies only to the following governmental entities:

(1)       A county.

(2)       A city as defined in G.S. 160A-1.

(2a)     A consolidated city-county as defined in G.S. 160B-2.

(2b)     A local school administrative unit.

(2c)     A joint agency created by interlocal agreement among local school administrative units pursuant to G.S. 160A-462 to jointly purchase food service-related materials, supplies, and equipment on their behalf.

(3)       A metropolitan sewerage district or a metropolitan water district in this State.

(4)       A water and sewer authority created under Chapter 162A of the General Statutes.

(5)       A lake authority created by a board of county commissioners pursuant to an act of the General Assembly.

(6)       A sanitary district.

(7)       A regional solid waste management authority created pursuant to G.S. 153A-421.

(8)       An area mental health, developmental disabilities, and substance abuse authority, other than a single-county area authority, established pursuant to Article 4 of Chapter 122C of the General Statutes.

(9)       A district health department, or a public health authority created pursuant to Part 1A of Article 2 of Chapter 130A of the General Statutes.

(10)     A regional council of governments created pursuant to G.S. 160A-470.

(11)     A regional planning and economic development commission or a regional economic development commission created pursuant to Chapter 158 of the General Statutes.

(12)     A regional planning commission created pursuant to G.S. 153A-391.

(13)     A regional sports authority created pursuant to G.S. 160A-479.

(14)     A public transportation authority created pursuant to Article 25 of Chapter 160A of the General Statutes.

(14a)   A facility authority created pursuant to Part 4 of Article 20 of Chapter 160A of the General Statutes.

(15)     A regional public transportation authority created pursuant to Article 26 of Chapter 160A of the General Statutes, or a regional transportation authority created pursuant to Article 27 of Chapter 160A of the General Statutes.

(16)     A local airport authority that was created pursuant to a local act of the General Assembly.

(17)     A joint agency created by interlocal agreement pursuant to G.S. 160A-462 to operate a public broadcasting television station.

(18)     Repealed by Session Laws 2001-474, s. 7, effective November 29, 2001.

(19)     Repealed by Session Laws 2001-474, s. 7, effective November 29, 2001.

(20)     A constituent institution of The University of North Carolina, but only with respect to sales and use tax paid by it for tangible personal property or services that are eligible for refund under this subsection acquired by it through the expenditure of contract and grant funds.

(21)     The University of North Carolina Health Care System.

(22)     A regional natural gas district created pursuant to Article 28 of Chapter 160A of the General Statutes."

SECTION 7.27.(b)  G.S. 105-259(b) is amended by adding a new subdivision to read:

"(b)      Disclosure Prohibited. - An officer, an employee, or an agent of the State who has access to tax information in the course of service to or employment by the State may not disclose the information to any other person unless the disclosure is made for one of the following purposes:

(32)     To provide the report required under G.S. 105-164.14(c) to the Department of Public Instruction and the Fiscal Research Division of the General Assembly."

SECTION 7.27.(c)  In addition to the report required under G.S. 105-164.14(c), as amended by this section, the Secretary of Revenue shall make a report to the Department of Public Instruction and the Fiscal Research Division of the General Assembly within 30 days after this act becomes law of the amount of refunds, identified by taxpayer, claimed under subdivisions (2b) and (2c) of G.S. 105-164.14(c) during the 2002-2003, 2003-2004, and 2004-2005 fiscal years.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

REVIEW OF standards for Masters in school administration PROGRAMS

SECTION 7.28.  The State Board of Education, in consultation with the Board of Governors of The University of North Carolina, shall review standards for Masters in School Administration programs to ensure that appropriate competencies related to teacher retention, teacher evaluations, teacher support programs, and teacher effectiveness are included and emphasized.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

EVALUATION OF SCHOOL PRINCIPALS

SECTION 7.29.  Chapter 115C of the General Statutes is amended by adding a new section to read:

" 115C-286.1.  Evaluations of principals.

Local school administrative units shall evaluate all principals and assistant principals at least once each year. Either the superintendent or the superintendent's designee shall conduct the evaluations.

The State Board of Education shall ensure that the standards and criteria for the evaluations include the accountability measures of teacher retention, teacher support, and school climate. The State Board shall revise its evaluation instruments to include these measures. A local board shall use the performance standards and criteria adopted by the State Board unless the board develops an alternative evaluation that is properly validated and that includes standards and criteria similar to those adopted by the State Board."

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

PLANNING TIME FOR TEACHERS

SECTION 7.30.  The State Board of Education shall report on best practices from North Carolina schools for providing a minimum of five hours per week within the instructional day for planning, collaborating with colleagues and parents, and professional development, especially within elementary school schedules. The State Board shall submit its report to the Education Cabinet and to the Joint Legislative Education Oversight Committee by December 31, 2005.

The State Board shall disseminate this information about best practices to schools and school systems across the State.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

ONLINE PROFESSIONAL DEVELOPMENT RESOURCE CENTER FOR TEACHERS AND PRINCIPALS

SECTION 7.31.  The State Board of Education and the Department of Public Instruction shall develop a Web portal that catalogues high-quality professional development opportunities for teachers and principals.

The State Chief Information Officer must approve the system's information technology project plan before funds are spent for the implementation of this system.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

LEARN AND EARN HIGH SCHOOLS

SECTION 7.32.(a)  Funds are appropriated in this act for the Learn and Earn high school workforce development program.  The purpose of the program is to create rigorous and relevant high school options that provide students with the opportunity and assistance to earn an associate degree or two years of college credit by the conclusion of the year after their senior year in high school. The State Board of Education shall work closely with the Education Cabinet and the New Schools Project in administering the program.

SECTION 7.32.(b)  These funds shall be used to establish new high schools in which a local school administrative unit, two- and four-year colleges and universities, and local employers work together to ensure that high school and postsecondary college curricula operate seamlessly and meet the needs of participating employers.

Funds shall not be allotted until Learn and Earn high schools are certified as operational.

SECTION 7.32.(c)  During the first year of its operation, a high school established under G.S. 115C-238.50 shall be allotted a principal regardless of the number of State-paid teachers assigned to the school or the number of students enrolled in the school.

SECTION 7.32.(d)  The State Board of Education, in consultation with the State Board of Community Colleges and The University of North Carolina Board of Governors, shall conduct an annual evaluation of this program.  The evaluation shall include measures as identified in G.S. 115C-238.55. It shall also include: (i) an accounting of how funds and personnel resources were utilized and their impact on student achievement, retention, and employability; (ii) recommended statutory and policy changes; and (iii) recommendations for improvement of the program.  The State Board of Education shall report the results of this evaluation to the Office of State Budget and Management, the Joint Legislative Education Oversight Committee, and the Fiscal Research Division by January 15 of each fiscal year.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

FLEXIBILITY FOR HIGH SCHOOL INNOVATION

SECTION 7.33.(a)  Part 9 of Article 16 of Chapter 115C of the General Statutes reads as rewritten:

"Part 9. Cooperative Innovative High School Programs.

" 115C-238.50.  Purpose.

(a)       The purpose of this Part is to authorize boards of trustees of community colleges and local boards of education to jointly establish local boards of education to jointly establish with one or more boards of trustees cooperative innovative programs in high schools and community colleges or universities that will expand students' opportunities for educational success through high quality instructional programming. These cooperative innovative high school programs shall target:

(1)       High school students who are at risk of dropping out of school before attaining a high school diploma; or

(2)       High school students who would benefit from accelerated academic instruction.

(b)       All the cooperative innovative high school programs established under this Part shall:

(1)       Prepare students adequately for future learning in the workforce or in an institution of higher education.

(2)       Expand students' educational opportunities within the public school system.

(3)       Be centered on the core academic standards represented by the college preparatory or tech prep program of study as defined by the State Board of Education.

(4)       Encourage the cooperative or shared use of resources, personnel, and facilities between public schools and community colleges. colleges or universities, or both.

(5)       Integrate and emphasize both academic and technical skills necessary for students to be successful in a more demanding and changing workplace.

(6)       Emphasize parental involvement and provide consistent counseling, advising, and parent conferencing so that parents and students can make responsible decisions regarding course taking and can track the students' academic progress and success.

(7)       Be held accountable for meeting measurable student achievement results.

(8)       Encourage the use of different and innovative teaching methods.

(9)       Establish joint institutional responsibility and accountability for support of students and their success.

(10)     Effectively utilize existing funding sources for high school, community college, university, and vocational programs and actively pursue new funding from other sources.

(11)     Develop methods for early identification of potential participating students in the middle grades and through high school.

(12)     Reduce the percentage of students needing remedial courses upon their initial entry from high school into a college or university.

(c)       Programs developed under this Part that target students who are at risk of dropping out of high school before attaining a high school diploma shall:

(1)       Provide these students with the opportunity to graduate from high school possessing the core academic skills needed for postsecondary education and high-skilled employment.

(2)       Enable students to complete a technical or academic program in a field that is in high demand and has high wages.

(3)       Set and achieve goals that significantly reduce dropout rates and raise high school and community college retention, certification, and degree completion rates.

(4)       Enable students who complete these programs to pass employer exams, if applicable.

(d)       Cooperative innovative high school programs that offer accelerated learning programs shall:

(1)       Provide a flexible, customized program of instruction for students who would benefit from accelerated, higher level coursework or early graduation from high school.

(2)       Enable students to obtain a high school diploma in less than four years and years, to begin or complete an associate degree program or program, to master a certificate or vocational program.program, or to earn up to two years of college credit.

(3)       Offer a college preparatory academic core and in-depth studies in a career or technical field that will lead to advanced programs or employment opportunities in engineering, health sciences, or teaching.

(e)       Cooperative innovative high school programs may include the creation of a school within a school, a technical high school, or a high school or technical center located on the campus of a community college.college or university.

(f)        Students are eligible to attend these programs as early as ninth grade.

" 115C-238.50A.  Definitions.

The following definitions apply in this Part:

(1)       Constituent institution. - A constituent institution as defined in G.S. 116-2(4).

(2)       Education partner. - An education partner as provided in G.S. 115C-238.52.

(3)       Governing board. - The State Board of Community Colleges, the Board of Governors of The University of North Carolina, or the Board of the North Carolina Independent Colleges and Universities.

(4)       Local board of trustees. - The board of trustees of a community college, constituent institution of The University of North Carolina, or private college located in North Carolina.

" 115C-238.51.  Application process.

(a)       A local board of education and a at least one local board of trustees of a community college shall jointly apply to establish a cooperative innovative high school program under this Part.

(b)       The application shall contain at least the following information:

(1)       A description of a program that implements the purposes in G.S. 115C-238.50.

(2)       A statement of how the program relates to the Economic Vision Plan adopted for the economic development region in which the program is to be located.

(3)       The facilities to be used by the program and the manner in which administrative services of the program are to be provided.

(4)       A description of student academic and vocational achievement goals and the method of demonstrating that students have attained the skills and knowledge specified for those goals.

(5)       A description of how the program will be operated, including budgeting, curriculum, transportation, and operating procedures.

(6)       The process to be followed by the program to ensure parental involvement.

(7)       The process by which students will be selected for and admitted to the program.

(8)       A description of the funds that will be used and a proposed budget for the program. This description shall identify how the average daily membership (ADM) and full-time equivalent (FTE) students are counted.

(9)       The qualifications required for individuals employed in the program.

(10)     The number of students to be served.

(11)     A description of how the program's effectiveness in meeting the purposes in G.S. 115C-238.50 will be measured.

(c)       The application shall be submitted to the State Board of Education and the State Board of Community Colleges applicable governing Boards by November 1 of each year. The State Board of Education and the State Board of Community Colleges Boards shall appoint a joint advisory committee to review the applications and to recommend to the State Boards those programs that meet the requirements of this Part and that achieve the purposes set out in G.S. 115C-238.50.

(d)       The State Board of Education and the State Board of Community Colleges shall approve two cooperative innovative high school programs in each of the State's economic development regions. The State Boards may approve programs recommended by the joint advisory committee or may approve other programs that were not recommended. The State Boards shall approve all applications by March 15 of each year. No application shall be approved unless the State Boards State Board of Education and the applicable governing Board find that the application meets the requirements set out in this Part and that granting the application would achieve the purposes set out in G.S. 115C-238.50. Priority shall be given to applications that are most likely to further State education policies, to address the economic development needs of the economic development regions in which they are located, and to strengthen the educational programs offered in the local school administrative units in which they are located.

" 115C-238.52.  Participation by other education partners.

(a)       Any or all of the following education partners may participate in the development of a cooperative innovative program under this Part that is targeted to high school students who would benefit from accelerated academic instruction:

(1)       A constituent institution of The University of North Carolina.

(2)       A private college or university located in North Carolina.

(3)       A private business or organization.

(4)       The county board of commissioners in the county in which the program is located.

(b)       Any or all of the education partners listed in subsection (a) of this section that participate shall:

(1)       Jointly apply with the local board of education and the local board of trustees of the community college to establish a cooperative innovative program under this Part.

(2)       Be identified in the application.

(3)       Sign the written agreement under G.S. 115C-238.53(b).

" 115C-238.53.  Program operation.

(a)       A program approved by the State shall be is accountable to the local board of education.

(b)       A program approved under this Part shall operate under the terms of a written agreement signed by the local board of education, local board of trustees of the community college, trustees, State Board of Education, and State Board of Community Colleges. applicable governing Board. The agreement shall incorporate the information provided in the application, as modified during the approval process, and any terms and conditions imposed on the program by the State Board of Education and the State Board of Community Colleges. applicable governing Board. The agreement may be for a term of no longer than five school years.

(c)       A program may be operated in a facility owned or leased by the local board of education, the local board of trustees of the community college, trustees, or the education partner, if any.

(d)       A program approved under this Part shall provide instruction each school year for at least 180 days during nine calendar months, shall comply with laws and policies relating to the education of students with disabilities, and shall comply with Article 27 of this Chapter.

(e)       A program approved under this Part may use State, federal, and local funds allocated to the local school administrative unit, to the State Board of Community Colleges, applicable governing Board, and to the community college or university to implement the program. If there is an education partner and if it is a public body, the program may use State, federal, and local funds allocated to that body.

(f)        Except as provided in this Part and pursuant to under the terms of the agreement, a program is exempt from laws and rules applicable to a local board of education, a local school administrative unit, a community college, a constituent institution, or a local board of trustees of a community college.trustees.

" 115C-238.54.  Funds for programs.

(a)       The Department of Public Instruction shall assign a school code for each program that is approved under this Part. All positions and other State and federal allotments that are generated for this program shall be assigned to that school code. Notwithstanding G.S. 115C-105.25, once funds are assigned to that school code, the local board of education may use these funds for the program and may transfer these funds between funding allotment categories.

(b)       The local board of trustees of a community college may allocate State and federal funds for a program that is approved under this Part.

(c)       An education partner under G.S. 115C-238.52 that is a public body may allocate State, federal, and local funds for a program that is approved under this Part.

(d)       If not an education partner under G.S. 115C-238.52, a county board of commissioners in a county where a program is located may nevertheless appropriate funds to a program approved under this Part.

(e)       The local board of education and the local board of trustees of the community college are strongly encouraged to seek funds from sources other than State, federal, and local appropriations. They are strongly encouraged to seek funds the Education Cabinet identifies or obtains under G.S. 116C-4.

" 115C-238.55.  Evaluation of programs.

The State Board of Education and the State Board of Community Colleges governing Boards shall evaluate the success of students in programs approved under this Part. Success shall be measured by high school retention rates, high school completion rates, high school dropout rates, certification and associate degree completion, admission to four-year institutions, postgraduation employment in career or study-related fields, and employer satisfaction of employees who participated in and graduated from the programs. Beginning October 15, 2005, and annually thereafter, the Boards shall jointly report to the Joint Legislative Education Oversight Committee on the evaluation of these programs. If, by October 15, 2006, the Boards determine any or all of these programs have been successful, they shall jointly develop a prototype plan for similar programs that could be expanded across the State. This plan shall be included in their report to the Joint Legislative Education Oversight Committee that is due by October 15, 2007."

SECTION 7.33.(b)  It is the intent of the General Assembly that three cooperative innovative high school programs are established that emphasize the educational development of high school students in the areas of science and mathematics in a nonresidential setting.  One of these programs shall be located in the eastern region of the State, one shall be located in the central region of the State, and one shall be located in the western region of the State.  The State Board of Education shall begin planning for the design and implementation of these programs and shall report their plan to the Joint Legislative Education Oversight Committee and the Fiscal Research Division of the General Assembly by March 15, 2006.

The plan shall include, but not be limited to, the following aspects of the proposed programs:

(1)       Programmatic design including location, curriculum, student access, and calendar,

(2)       Projected costs of operation, including instructional, administrative, transportation, capital, and other costs,

(3)       Any plans for coordination with institutes of higher education,

(4)       Proposed implementation schedule.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

funds for education of STUDENTS at eckerd youth ALTERNATIVES therapeutic camp

SECTION 7.35.  If a student is placed in an Eckerd Youth Alternatives therapeutic camp on  the recommendation of a local school administrative unit, the unit shall transfer to the camp the State funds allocated to the unit for the education of the child.  For each day that the child receives educational services at the camp, that unit shall pay 1/180 of the annual amount a charter school located in that unit would receive in State funds for that child, for a maximum of 180 days in a fiscal year.  If the child is a child with special needs, the unit shall also be responsible for the State per pupil allocation for children with special needs.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

minimize time devoted to standardized tests

SECTION 7.37.  G.S. 115C-174.12(a) reads as rewritten:

"(a)      The State Board of Education shall establish policies and guidelines necessary for minimizing the time students spend taking tests administered through State and local testing programs, for minimizing the frequency of field testing at any one school, and for otherwise carrying out the provisions of this Article. These policies and guidelines shall include the following:

(1)       Schools shall devote no more than two days of instructional time per year to the taking of practice tests that do not have the primary purpose of assessing current student learning;

(2)       Students in a school shall not be subject to field tests or national tests during the two-week period preceding the administration of end-of-grade tests, end-of-course tests, or the school's regularly scheduled final exams; and

(3)       No school shall participate in more than two field tests at any one grade level during a school year unless that school volunteers, through a vote of its school improvement team, to participate in an expanded number of field tests.

These policies shall reflect standard testing practices to insure reliability and validity of the sample testing. The results of the field tests shall be used in the final design of each test. The State Board of Education's policies regarding the testing of children with disabilities shall (i) provide broad accommodations and alternate methods of assessment that are consistent with a child's individualized education program and section 504 (29 U.S.C. 794) plans, (ii) prohibit the use of statewide tests as the sole determinant of decisions about a child's graduation or promotion, and (iii) provide parents with information about the Statewide Testing Program and options for students with disabilities. The State Board shall report its proposed policies and proposed changes in policies to the Joint Legislative Education Oversight Committee prior to adoption.

The State Board of Education may appoint an Advisory Council on Testing to assist in carrying out its responsibilities under this Article."

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

education cabinet

SECTION 7.38.(a)  G.S. 116C-1(b) reads as rewritten:

"(b)      The Education Cabinet shall consist of the Governor, who shall serve as chair, the President of The University of North Carolina, the State Superintendent of Public Instruction, the Chairman of the State Board of Education, the President of the North Carolina Community Colleges System, the Secretary of Health and Human Services, and the President of the North Carolina Independent Colleges and Universities. The Education Cabinet may invite other representatives of education to participate in its deliberations as adjunct members."

SECTION 7.38.(b)  The Education Cabinet shall study:

(1)       The extent to which school nurses, school social workers, and other instructional support personnel collaborate with each other and with local health, mental health, and social services providers to meet the needs of at-risk children and their families and to support the educational achievement of at-risk children; and

(2)       The need for additional training for school nurses, school social workers, and other instructional support personnel on multidisciplinary assessments and on referral and care coordination for at-risk students and their families.

The Education Cabinet shall report the results of its study and its recommendations to the Joint Legislative Education Oversight Committee prior to April 15, 2006.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

the center for 21st century skills

SECTION 7.39.(a)  The State Board of Education shall transfer funds appropriated for the Center for 21st Century Skills to the Office of the Governor.  These funds shall be used for the establishment of the Center for 21st Century Skills within the North Carolina Business Committee for Education, Inc. The purpose of the Center shall be to design curriculum, teacher training, and student assessment to support students acquiring the knowledge and skills needed for the emerging workforce of the 21st century.

SECTION 7.39.(b)  The North Carolina Business Committee for Education, Inc., and the Center for 21st Century Skills shall coordinate their efforts on high school reform with the North Carolina New Schools Project.

SECTION 7.39.(c)  The North Carolina Business Committee for Education, Inc., and the Center for 21st Century Skills shall work with the North Carolina Science, Mathematics and Technology Education Center, the North Carolina School of Science and Mathematics, the North Carolina Board of Science and Technology, and the governing boards of education to research and propose options to create new or expand existing mathematics and science summer enrichment programs across the State and to establish nonresidential high schools focused on mathematics, science, and technology. The Center shall also support efforts of the Futures for Kids Program to connect students with the workforce needs of their home communities.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

TEACHER WORKING CONDITIONS INITIATIVE

SECTION 7.40.(a)  Funds are appropriated in this act to continue the Governor's Teacher Working Conditions Survey. The State Board of Education shall use these funds: (i) for the administration of the survey by the Professional Teaching Standards Commission on a biennial basis, and (ii) to establish an advisory board to oversee implementation of recommendations from the survey.

SECTION 7.40.(b)  The State Board of Education may supplement these funds with gifts or other private funds donated for this purpose.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

plan and funding for a virtual high school

SECTION 7.41.(a)  The State Board of Education, the Board of Governors of The University of North Carolina, the Independent Colleges and Universities, and the State Board of Community Colleges shall develop E-learning standards and plans for infrastructures that provide virtual learning opportunities accessible to students and other citizens through all North Carolina schools, universities, and community colleges. In developing the plan for the public schools, the State Board of Education shall focus initially on high schools while also researching and developing, where appropriate, E-learning for middle schools, junior high schools, and elementary schools. E-learning programs shall support both teachers and students.

SECTION 7.41.(b)  As used in this section, "E-learning" is electronic learning that includes a wide set of applications and processes, such as Web-based learning, computer-based learning, virtual classrooms, and digital collaboration. It includes the delivery of content via Internet, intranet/extranet (LAN/WAN), audiotape, videotape, satellite broadcast, interactive television, and CD-ROM.

SECTION 7.41.(c)  It is the intent of the General Assembly to give public schools the highest priority in funding for and development of E-learning. Funding for E-learning should be a new appropriation and not come exclusively from existing funds.

SECTION 7.41.(d)  The State Board of Education shall use funds appropriated for a virtual high school to establish and implement a pilot virtual high school during the 2005-2006 school year and the 2006-2007 school year.

The State Board of Education shall include in the pilot program instruction on personal financial literacy. This instruction shall be designed to equip students with the knowledge and skills they need, before they become self-supporting, to make critical decisions regarding their personal finances. The components of instruction shall include, at a minimum, consumer financial education, personal finance, and personal credit.

SECTION 7.41.(e)  If the pilot program is successful, it is the intent of the General Assembly to provide funding to implement a virtual high school on a statewide basis for the 2006-2007 fiscal year.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

feasibility study for developing regional EDUCATION networks

SECTION 7.42.  The North Carolina Rural Economic Development Center and the e-NC Authority, in collaboration with representatives from local school administrative units, The University of North Carolina, the State Board of Education, the State Chief Information Officer, and the Community College System shall perform a feasibility study on developing regional education networks that are centrally managed to provide and sustain broadband connectivity to individual students and teachers in schools, community colleges, and universities.

The study shall include an evaluation of existing technology infrastructures, such as the statewide infrastructure, the North Carolina Research and Education Network, or the regional infrastructure, Winston-Net. These state-of-the-art infrastructures may be capable of supporting growth in traffic and thus serve as a backbone infrastructure for delivering high-speed access to underserved regions.

The North Carolina Rural Economic Development Center and the e-NC Authority shall report the results of the study to the 2006 Regular Session of the 2005 General Assembly.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

plan for projecting school technology funding needs

SECTION 7.43.(a)  G.S. 115C-102.6A(c) reads as rewritten:

"(c)      Components of the State school technology plan shall include at least the following:

(17)     A baseline template for:

a.         Technology infrastructure, including broadband connectivity, personnel recommendations, and other resources needed to operate effectively from the classroom desktop to local, regional, and State networks, and

b.         An evaluation component that provides for local school administrative unit accountability for maintaining quality upgradeable systems."

SECTION 7.43.(b)  No later than October 31, 2005, the Department of Public Instruction shall hold regional workshops for local school administrative units to provide guidance in developing local school system technology plans that meet the criteria established in the State school technology plan, including the components added under subsection (a) of this section. The State Chief Information Officer will assist with the regional meetings as needed to provide technical assistance.

SECTION 7.43.(c)  G.S. 115C-102.7 is amended by adding the following new subsection to read:

"(c)      The Department of Public Instruction shall randomly check local school system technology plans to ensure that local school administrative units are implementing their plans as approved. The Department shall report to the State Board of Education and the State Chief Information Officer on which local school administrative units are not complying with their plans. The report shall include the reasons these local school administrative units are out of compliance and a recommended plan of action to support each of these local school administrative units in carrying out their plans."

SECTION 7.43.(d)  The State Board of Education shall determine the total amount of funds needed for the recurring total cost of ownership to implement, maintain, and upgrade technology infrastructures and instructional technology as specified in the revised local school system technology plans. This shall include personnel costs for both technical and instructional needs so that a three- to five-year budget plan can be developed for the General Assembly.

SECTION 7.43.(e)  The State Board of Education shall also study and identify the types of resources needed to operate schools designed to meet the needs of twenty-first century learners.

The State Board shall report the results of this study to the 2006 Regular Session of the 2005 General Assembly.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

annual report that highlights the IMPACT of education preparation on economic growth

SECTION 7.44.  The North Carolina Board of Science and Technology shall prepare an annual report by county on the status of trends that reflect the impact of education on economic growth for the twenty-first century. This report shall contain information about the status of each county with regard to education and economic growth.

The Board shall  provide the report to the Regular 2006 Session of the 2005 General Assembly and shall make the report available for citizens.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

process for more assistance for e-rate

SECTION 7.45.  2IIn order to provide assistance to local school administrative units with E-rate applications, the Department of Public Instruction shall, within existing funds, ensure that a minimum of one full-time coordinator who has technical knowledge and skills is assigned this responsibility. The Department shall notify local school administrative units about the person or office assigned the responsibility of providing assistance with E-rate applications.

The Department shall provide the State Board of Education with an annual report on E-rate, including funding, commitments, and enrollment by local school administrative units.

As used in this section, "E-rate" is the mechanism to provide discount rates to support universal telecommunications services for use by schools and libraries as provided in section 254 of the federal Telecommunications Act of 1996.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

planning for a state central INFRASTRUCTURE office

SECTION 7.46.(a)  The Office of State Budget and Management shall conduct a study to determine the feasibility of establishing a State Central Infrastructure Office that would collect and manage information for technology, water, sewer, and other utility infrastructures needed to assist communities in becoming and remaining economically viable.

SECTION 7.46.(b)  The Office of State Budget and Management shall report the results of this study to the 2006 Regular Session of the 2005 General Assembly.  The report shall include legislative proposals, including a proposal to define the term "infrastructure" in the General Statutes to include technology.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

school employee SALARY STUDY

SECTION 7.47.  The Joint Legislative Education Oversight Committee shall study the current salary structure for teachers and other school employees.  In the course of the study, the Committee shall:

(1)       Develop a plan to get the State moving toward the national average in teacher salaries by 2008 and toward the top 10 states in the nation by 2010.

(2)       Consider strategies for maintaining the lead in teacher salaries in the Southeastern United States.

(3)       Consider the need to reduce the number of steps on the teacher salary schedule, increase the beginning teacher salary, and enable an individual to reach the maximum salary sooner.

(4)       Perform a market-sensitive analysis of the skills and knowledge needed to be a successful teacher to determine what it takes to make the schedule attractive and competitive.

(4)       Consider the placement of appropriate extraordinary increases on schedule for achievement of career status, teacher retention, and other purposes.

(5)       Determine the need to modify the masters schedule differential.

(6)       Determine the need to modify the alternative salary schedules to reward different levels of academic preparation and career accomplishments such as attainment of national certification.

(7)       Consider the appropriate relationship of the school counselor's schedule to the schedules for other members of the school-based staff.

(8)       Determine the need to modify the administrator salary schedule.

(9)       Consider other matters the Committee deems appropriate.

The Committee shall report the results of its study to the 2006 Regular Session of the 2005 General Assembly.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

commission for a sound basic education

SECTION 7.48.(a)  The North Carolina Commission for a Sound Basic Education is hereby established.  The Commission shall (i) investigate strategies and resources which contribute to the opportunity for North Carolina students to obtain a sound basic education, (ii) analyze all current plans for implementing the strategies developed to enhance every child's ability to fulfill his or her potential, and (iii) if necessary, provide a cost analysis for implementing those plans.

SECTION 7.48.(b)  The Commission shall consist of six members appointed by the President Pro Tempore of the Senate and six members appointed by the Speaker of the House of Representatives.  The President Pro Tempore of the Senate and the Speaker of the House of Representatives shall each designate a cochair of the Commission from their appointees.

SECTION 7.48.(c)  The Commission shall appoint advisory members to assist it in its work.  The advisory members shall include at least two parents of children in the public schools and representatives of State agencies, the Community College System, The University of North Carolina, education organizations, child health organizations, and child advocacy organizations.

SECTION 7.48.(d)  The full commission shall meet on a monthly basis. The commission shall develop the necessary and appropriate committees and subcommittees to facilitate completion of its work.  The committees and subcommittees shall meet as necessary to effectively conduct the work with which they are charged.

SECTION 7.48.(e)  Only members of the Commission may vote on any matter before the Commission.

SECTION 7.48.(f)  Members of the Commission and advisory members of the Commission shall receive per diem, subsistence, and travel allowances in accordance with G.S. 120-3.1, 138-5, or 138-6, as appropriate.

SECTION 7.48.(g)  The Commission, while in the discharge of its official duties, may exercise all powers provided for under G.S. 120-19 and G.S. 120-19.1 through G.S. 120-19.4. The Commission may meet at any time upon the joint call of the cochairs. The Commission may meet in the Legislative Building or the Legislative Office Building.

The Legislative Services Commission, through the Legislative Services Officer, shall assign professional staff to assist the Commission in its work. The House of Representatives' and the Senate's Supervisors of Clerks shall assign clerical staff to the Commission, and the expenses relating to the clerical employees shall be borne by the Commission. The Commission may contract for professional, clerical, or consultant services as provided by G.S. 120-32.02. If the Commission hires a consultant, the consultant shall not be a State employee or a person currently under contract with the State to provide services.

All State departments and agencies and local governments and their subdivisions shall furnish the Commission with any information in their possession or available to them.

The Legislative Services Commission, through the Legislative Services Officer, shall assign professional staff to assist the Commission in its work. The House of Representatives' and the Senate's Supervisors of Clerks shall assign clerical staff to the Commission, and the expenses relating to the clerical employees shall be borne by the Commission.

SECTION 7.48.(h)  The Commission shall provide opportunities for substantive and meaningful input into and development and review of the comprehensive plan by all stakeholders in the public education system.  These stakeholders include, but are not limited to, students, parents, guardians, educators, school board members, education advocates, and child health professionals. Opportunities for input and review shall include (i) regional public forums, (ii) regular distribution to local newspapers statewide of details of its work and posting of the information on the Internet, (iii) providing stakeholders with the opportunity to identify representative members of stakeholder groups to be included as full participants in the Commission's deliberations, and (iv) open meetings of the Commission and any committees it may create.

SECTION 7.48.(i)  The Commission shall make a final report to the General Assembly by January 15, 2006. The report shall include the details of the plans, the results of the cost analysis and a proposed budget, and any statutory changes necessary to implement the plans on a statewide basis.

SECTION 7.48.(j)  The Commission shall terminate upon filing its final report or upon the convening of the 2006 Regular Session of the 2005 General Assembly, whichever is earlier.

SECTION 7.48.(k)  Funds in the amount of two hundred thousand dollars ($200,000) are appropriated in this act to the General Assembly to carry out its work of the North Carolina Commission for a Sound Basic Education.

 

PART VIII. COMMUNITY COLLEGES

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

Use of Funds for the College Information System Project

SECTION 8.1.(a)  Funds appropriated to the Community Colleges System Office for the College Information System Project shall not revert at the end of the 2004-2005 fiscal year but shall remain available until expended.

SECTION 8.1.(b)  The Community Colleges System Office shall report on a quarterly basis to the Joint Legislative Education Oversight Committee on the implementation of the College Information System Project.

SECTION 8.1.(c)  Subsection (a) of this section becomes effective June 30, 2005.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

Carryforward for Equipment

SECTION 8.2.(a)  Subject to the approval of the Office of State Budget and Management and cash availability, the North Carolina Community Colleges System Office may carry-forward an amount not to exceed fifteen million dollars ($15,000,000) of the operating funds that were not reverted in fiscal year 2004-2005 to be reallocated to the State Board of Community Colleges' Equipment Reserve Fund.  These funds shall be distributed to colleges consistent with G.S. 115D-31.

SECTION 8.2.(b)  This section becomes effective June 30, 2005.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

SALARIES OF COMMUNITY COLLEGE FACULTY AND PROFESSIONAL STAFF

SECTION 8.3.(a)  The minimum salaries for community college faculty shall be based on the following education levels:

(1)       Vocational Diploma/Certificate or Less. - This education level includes faculty members who are high school graduates, have vocational diplomas, or have completed one year of college.

(2)       Associate Degree or Equivalent. - This education level includes faculty members who have an associate degree or have completed two or more years of college but have no degree.

(3)       Bachelors Degree.

(4)       Masters Degree or Education Specialist.

(5)       Doctoral Degree.

SECTION 8.3.(b)  For the 2005-2006 school year, the minimum salaries for nine-month, full-time, curriculum community college faculty shall be as follows:

                                             Education Level                                           Minimum Salary

                                                                                                          2005-2006     2006-2007

Vocational Diploma/Certificate or Less                 $29,652          $30,542

Associate Degree or Equivalent                               $30,102            31,005

Bachelors Degree                                                      $32,050            33,011

Masters Degree or Education Specialist                 $33,777            34,790

Doctoral Degree                                                        $36,269            37,357

No full-time faculty member shall earn less than the minimum salary for his or her education level.

The pro rata hourly rate of the minimum salary for each education level shall be used to determine the minimum salary for part-time faculty members.

SECTION 8.3.(c)

(1)       It is the intent of the General Assembly to encourage community colleges to make faculty salaries a priority and to reward colleges that have taken steps to achieve the national average, therefore:

a.         If the average faculty salary at a community college is one hundred percent (100%) or more of the national average community college faculty salary, the college may transfer up to eight percent (8%) of the State funds allocated to it for faculty salaries.

b.         If the average faculty salary at a community college is at least ninety-five percent (95%) but less than one hundred percent (100%) of the national average community college faculty salary, the college may transfer up to six percent (6%) of the State funds allocated to it for faculty salaries.

c.         If the average faculty salary at a community college is at least ninety percent (90%) but less than ninety-five percent (95%) of the national average community college faculty salary, the college may transfer up to five percent (5%) of the State funds allocated to it for faculty salaries.

d.         If the average faculty salary at a community college is at least eighty-five percent (85%) but less than ninety percent (90%) of the national average community college faculty salary, the college may transfer up to three percent (3%) of the State funds allocated to it for faculty salaries.

e.         If the average faculty salary at a community college is eighty-five percent (85%) or less of the national average community college faculty salary, the college may transfer up to two percent (2%) of the State funds allocated to it for faculty salaries.

Except as provided by subdivision (2) of this subsection, a community college shall not transfer a greater percentage of the State funds allocated to it for faculty salaries than is authorized by this subsection.

(2)       With the approval of the State Board of Community Colleges, a community college at which the average faculty salary is eighty-five percent (85%) or less of the national average may transfer a greater percentage of the State funds allocated to it for faculty salaries than is authorized by sub-subdivision e. of subdivision (1) of this subsection. The State Board shall approve the transfer only for purposes that directly affect student services.

(3)       A local community college may use all State funds allocated to it except for Literacy Funds and Funds for New and Expanding Industry Training to increase faculty salaries.

SECTION 8.3.(d)  As used in this section:

(1)       "Average faculty salary at a community college" means the total nine-month salary from all sources of all nine-month, full-time, curriculum faculty at the college, as determined by the North Carolina Community College System on October 1 of each year.

(2)       "National average community college faculty salary" means the nine-month, full-time, curriculum salary average, as published by the Integrated Postsecondary Education Data System (IPEDS), for the most recent year for which data are available.

SECTION 8.3.(e)  The State Board of Community Colleges shall adopt rules to implement the provisions of this section.

SECTION 8.3.(f)  The State Board of Community Colleges shall report to the appropriations subcommittees on education, the Speaker of the House of Representatives, the President Pro Tempore of the Senate, the Fiscal Research Division, and the Office of State Budget and Management by December 1, 2005, and every year thereafter through December 1, 2009, on the implementation of this section.

SECTION 8.3.(g)  Funds appropriated in this act for salary increases shall be used to increase faculty and professional staff salaries by an average of two percent (2%). These increases are in addition to other salary increases provided for in this act and shall be calculated on the average salaries prior to the issuance of the compensation increase. Colleges may provide additional increases from funds available.

The State Board of Community Colleges shall adopt rules to ensure that these funds are used only to move faculty and professional staff to the respective national averages. These funds shall not be transferred by the State Board or used for any other budget purpose by the community colleges.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

workforce development PROGRAMs

SECTION 8.4.(a)  Article 1 of Chapter 115D of the General Statutes is amended by adding a new G.S. 115D-5.1 to be entitled "Workforce Development Programs"; G.S. 115D-5(d) is recodified as G.S. 115D-5.1(a); G.S. 115D-5(k) is recodified as G.S. 115D-5.1(b); and G.S. 115D-5(i) is recodified as G.S. 115D-5.1(c).

SECTION 8.4.(b)  G.S. 115D-5.1, as enacted by subsection (a) of this section, reads as rewritten:

" 115D-5.1.  Workforce Development Programs.

(a)       Community colleges shall assist in the preemployment and in-service training of employees in industry, business, agriculture, health occupation and governmental agencies. Such training shall include instruction on worker safety and health standards and practices applicable to the field of employment. The State Board of Community Colleges shall make appropriate regulations including the establishment of maximum hours of instruction which may be offered at State expense in each in-plant training program. No instructor or other employee of a community college shall engage in the normal management, supervisory and operational functions of the establishment in which the instruction is offered during the hours in which the instructor or other employee is employed for instructional or educational purposes.

(b)       The North Carolina Community College System's New and Expanding Industry Training (NEIT) Program Guidelines, which were adopted by the State Board of Community Colleges on April 18, 1997, apply to all funds appropriated for the Program after June 30, 1997. A project approved as an exception under these Guidelines, or these Guidelines as modified by the State Board of Community Colleges, shall be approved for one year only.

(c)       The State Board of Community Colleges shall report to the Joint Legislative Education Oversight Committee on September 1 of each year on expenditures for the New and Expanding Industry Training Program each fiscal year. The report shall include, for each company or individual that receives funds for the New and Expanding Industry Training Program:

(1)       The total amount of funds received by the company or individual;

(2)       The amount of funds per trainee received by the company or individual;

(3)       The amount of funds received per trainee by the community college training the trainee;

(4)       The number of trainees trained by company and by community college; and

(5)       The number of years the companies or individuals have been funded.

(d)       Funds available to the New and Expanding Industry Training Program shall not revert at the end of a fiscal year but shall remain available until expended.

(e)       There is created within the North Carolina Community College System the Customized Industry Training (CIT) Program. The CIT Program shall offer programs and training services as new options for assisting existing business and industry to remain productive, profitable, and within the State. Before a business or industry qualifies to receive assistance under the CIT Program, the President of the North Carolina Community College System shall determine that:

(1)       The business is making an appreciable capital investment;

(2)       The business is deploying new technology; and

(3)       The skills of the workers will be enhanced by the assistance.

The State Board shall report on an annual basis to the Joint Legislative Education Oversight Committee on:

(1)       The total amount of funds received by a company under the CIT Program;

(2)       The amount of funds per trainee received by that company;

(3)       The amount of funds received per trainee by the community college delivering the training;

(4)       The number of trainees trained by the company and community college; and

(5)       The number of years that company has been funded.

The State Board shall adopt rules and policies to implement this section."

SECTION 8.4.(c)  Notwithstanding any other provision of law, the State Board of Community Colleges may use funds appropriated to it for the New and Expanding Industry Training Program to operate programs under the Customized Industry Training Program.

SECTION 8.4.(d)  G.S. 115D-5.1(d), as enacted by this section, becomes effective June 30, 2005.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

REPORT ON THE ADEQUACY OF MULTICAMPUS FUNDS

SECTION 8.5.  The General Assembly finds that additional data are needed to determine the adequacy of multicampus and off-campus center funds; therefore, multicampus colleges and colleges with off-campus centers shall report annually, beginning September 1, 2005, to the Community Colleges System Office on all expenditures by line item of funds used to support their multicampuses and off-campus centers.  The Community Colleges System Office shall report on these expenditures to the Education Appropriation Subcommittees of the House of Representatives and the Senate, the Office of State Budget and Management, and the Fiscal Research Division by October 1 of each year.

Notwithstanding any other provision of law, funds appropriated to the Community Colleges System Office for multicampus colleges or off-campus centers shall be used only for the administration of the multicampus college or off-campus center for which the funds were allotted. These funds shall not be transferred to any other campus or center, or used for any other purpose.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

EDUCATION PROGRAM AUDITING FUNCTION

SECTION 8.6.  G.S. 115D-5(m) reads as rewritten:

"(m)     The State Board of Community Colleges shall require auditors of community college programs to use a statistically valid sample size in performing program audits of community colleges. The State Board of Community Colleges shall maintain an education program auditing function that conducts an annual audit of each community college operating under the provisions of this Chapter. The purpose of the annual audit shall be to ensure that college programs and related fiscal operations comply with State law, State regulations, State Board policies, and System Office guidance. The State Board of Community Colleges shall require auditors of community college programs to use a statistically valid sample size in performing program audits of community colleges. All education program audit findings shall be forwarded to the college president, local college board of trustees, the State Board of Community Colleges, and the State Auditor. The State Board shall assess a twenty-five percent (25%) fiscal penalty in addition to the audit exception on all audits of both dollars and student membership hours excepted when the audit exceptions result from nonprocessing errors."

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

FERRY BOAT OPERATOR TRAINING FEASIBILITY STUDY

SECTION 8.7.(a)  The State Board of Community Colleges, in consultation with the Ferry Division of the Department of Transportation, shall study the need for training for ferry boat operators. In conducting the study, the State Board shall consider the following:

(1)       Types of training needed and whether it is feasible for the community colleges to provide this training.

(2)       Estimated number of students.

(3)       Estimated employment opportunities for the students.

(4)       Start-up costs for the program and resources for those costs.

(5)       Location of the training.

SECTION 8.7.(b)  The State Board shall report to the Joint Legislative Education Oversight Committee and the Joint Legislative Transportation Oversight Committee on its findings and recommendations no later than December 1, 2005.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

EXTEND THE SUNSET ON TRAINING AND REEMPLOYMENT CONTRIBUTIONS MADE BY EMPLOYERS

SECTION 8.8.(a)  Section 8 of S.L. 1999-321, as amended by Section 30.5(f) of S.L. 2001-424, reads as rewritten:

"Section 8. Section 1 of this act is effective with respect to calendar quarters beginning on or after April 1, 1999. Section 7 of this act becomes effective July 1, 1999. The remainder of this act is effective with respect to calendar quarters beginning on or after January 1, 2000. G.S. 96-6.1, as enacted by Section 2 of this act, is repealed effective with respect to calendar quarters beginning on or after January 1, 2006."

SECTION 8.8.(b)  G.S. 96-6.1 is amended by adding a new subsection to read:

"(c)      Sunset. - This section is repealed effective with respect to calendar quarters beginning on or after January 1, 2011."

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

Community College Innovative Learning Fund

SECTION 8.9.  There is created within the North Carolina Community College System (NCCCS) The Innovative Learning Fund. The purpose of the Fund is to assist colleges with infrastructure needs as they evolve to meet the needs of the changing economy. The President of the NCCCS, in consultation with the State Board of Community Colleges, may make grants to qualified colleges of up to one million dollars ($1,000,000), for planning, equipment, or technology for innovative or lifelong learning centers. The NCCCS shall consult with the seven Economic Development Partnerships, the local boards of trustees, the constituent institutions of The University System when appropriate, and any other entity it deems necessary to prioritize and determine which projects should receive grants from the Fund. In awarding the grants, the President and the State Board shall consider the following:

(1)       The Vision Plan of the Economic Development Partnership where the project will be located;

(2)       The ability of the county to provide funding for the project;

(3)       The maintenance of effort by the county to support the existing mission of the college;

(4)       The impact the innovative learning center will have on economic development in the county and region; and

(5)       The existence of any other innovative learning centers in the region.

Priority shall be given to projects that directly impact teacher education, allied health, economic development, or public safety.

Funds appropriated in this act for the Innovative Learning Fund shall not revert at the end of the 2005-2006 fiscal year but shall remain available until expended.

 

Requested by:            Senators Rand, Lucas, Swindell, Garrou, Dalton, Hagan

Carryforward for Colleges in Economically Disadvantaged Counties

SECTION 8.10.(a)  Notwithstanding G.S. 143-18 or any other provision of law, a community college may retain and carry-forward its General Fund current operations credit balance remaining at the end of the fiscal year, if the county in which the main campus of the community college is located:

(1)       Is designated as a Tier 1 or Tier 2 county in accordance with G.S. 105-129.3;

(2)       Had an unemployment rate greater than or equal to seven percent (7%) in calendar year 2004; and

(3)       Is designated as a Low-Wealth County under Section 7.6 of this act, whose wealth as calculated by the Low-Wealth Formula is eighty percent (80%) or less of the State Average.

SECTION 8.10.(b)  Colleges who serve counties that meet the criteria outlined in subsection (a) of this section, but whose main campuses are not located in such counties, may carry-forward the percentage of the funds remaining at the end of the fiscal year equal to the percentage of total full-time equivalent students served in those counties that meet the criteria, as determined by the North Carolina Community Colleges System Office.

SECTION 8.10.(c)  Allowable carryforwards under this section shall be calculated prior to the calculation of Performance Funding as described in G.S. 115D-31.3.

SECTION 8.10.(d)  This section becomes effective June 30, 2005.

 

Requested by:            Senators Rand, Lucas, Swindell, Garrou, Dalton, Hagan

DEFENSE TECHNOLOGY INNOVATION CENTER

SECTION 8.11.  Funds appropriated in this act for North Carolina Electronics and Information Technologies Association's Defense Technology Innovation Center shall be used for the following:

(1)       Site selection and acquisition, including the purchase or lease of real property to house the Center; the construction of buildings or other site structures; the improvement or refurbishment of existing structures to provide appropriate laboratory and administrative space; and the improvement of existing infrastructure at the facility, including improvements to utility, telecommunications, and Internet infrastructure.

(2)       Equipment acquisition, including acquisition of laboratory equipment and supplies and office furniture, equipment, and supplies.

(3)       Employment of staff to support the mission of the Center and to oversee day-to-day operations of the Center.

(4)       Implementation of a comprehensive business and marketing plan for the Center.

(5)       Development of a tenant screening process and the recruitment of appropriate tenants for the Center.

(6)       Administration and operation of the Center and the development of a sustainable business plan for the Center.

 

Requested by:            Senators Swindell, Lucas

community college capital funds

SECTION 8.12.  Notwithstanding G.S. 115D-31 or any other provision of law, funds appropriated in this act for community college capital projects do not have to be matched by local funds.

 

Requested by:            Senator Hunt

community college TUITION LANGUAGE

SECTION 8.13.  G.S. 115D-39 reads as rewritten:

" 115D-39.  Student tuition and fees.

(a)       The State Board of Community Colleges shall fix and regulate all tuition and fees charged to students for applying to or attending any institution pursuant to this Chapter.

The receipts from all student tuition and fees, other than student activity fees, shall be State funds and shall be deposited as provided by regulations of the State Board of Community Colleges.

The legal resident limitation with respect to tuition, set forth in G.S. 116-143.1 and G.S. 116-143.3, shall apply to students attending institutions operating pursuant to this Chapter; provided, however, that when an employer other than the armed services, as that term is defined in G.S. 116-143.3, pays tuition for an employee who is lawfully present in the United States to attend an institution operating pursuant to this Chapter and when the employee works at a North Carolina business location, the employer shall be charged the in-State tuition rate; provided further, however, a community college may charge in-State tuition to up to one percent (1%) of its out-of-state students, rounded up to the next whole number, to accommodate the families transferred by business, the families transferred by industry, or the civilian families transferred by the military, consistent with the provisions of G.S. 116-143.3, into the State. Notwithstanding these requirements, a refugee who lawfully entered the United States States, who remains lawfully within the United States, and who is living in this State shall be deemed to qualify as a domiciliary of this State under G.S. 116-143.1(a)(1) and as a State resident for community college tuition purposes as defined in G.S. 116-143.1(a)(2). Also, a nonresident of the United States who has resided in North Carolina for a 12-month qualifying period and has filed an immigrant petition with the United States Immigration and Naturalization Service shall be considered a State resident for community college tuition purposes.

(b)       In addition, any person lawfully admitted to the United States States, and who remains lawfully present in the United States, and who satisfied the qualifications for assignment to a public school set out under G.S. 115C-366 and graduated from the public school to which the student was assigned shall also be eligible for the State resident community college tuition rate. This subsection does not make a person a resident of North Carolina for any other purpose.

(c)       In addition, a person sponsored under this subsection who is lawfully admitted to the United States and who remains lawfully present is eligible for the State resident community college tuition rate. For purposes of this subsection, a North Carolina nonprofit entity is a charitable or religious corporation as defined in G.S. 55A-1-40 that is incorporated in North Carolina and that is exempt from taxation under section 501(c)(3) of the Internal Revenue Code, or a civic league incorporated in North Carolina under Chapter 55A of the General Statutes that is exempt from taxation under section 501(c)(4) of the Internal Revenue Code. A nonresident of the United States is sponsored by a North Carolina nonprofit entity if the student resides in North Carolina while attending the community college and the North Carolina nonprofit entity provides a signed affidavit to the community college verifying that the entity accepts financial responsibility for the student's tuition and any other required educational fees. Any North Carolina nonprofit entity that sponsors a nonresident of the United States under this subsection may sponsor no more than five nonresident students annually under this subsection. This subsection does not make a person a resident of North Carolina for any other purpose."

 

PART iX. UNIVERSITIES

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

UNC flexibility guidelines

SECTION 9.1.  The Chancellor of each constituent institution shall report to the Board of Governors of The University of North Carolina on the management flexibility adjustments made to the General Fund budget codes in order to meet the reserve amounts for that institution. The President of The University of North Carolina shall report to the Board of Governors of The University of North Carolina on the reductions made to the General Fund budget codes controlled by the Board in order to meet the reduction reserve amounts for those entities. The Board of Governors shall make a summary report to the Office of State Budget and Management and the Fiscal Research Division by December 31, 2005, on all reductions made by these entities and constituent institutions in order to reduce the budgets by the targeted amounts.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

ENROLLMENT GROWTH FUND/Encourage Partnerships for new 2 + 2 Programs

SECTION 9.2.(a)  The University of North Carolina Board of Governors' Task Force on Meeting Teacher Supply and Demand called for the President to develop a plan for enrollment growth in the University System's teacher education programs to respond to the State's shortage of teachers.  In a presentation to the Joint Legislative Education Oversight Committee and to the Board of Governors, a commitment was made to increase the number of teacher education graduates in 2005-2006 and in 2006-2007.  The Office of the President of The University of North Carolina shall obtain plans from each campus as to how they will maintain their current enrollment in the teacher education programs and achieve their growth targets to ensure such increases in those programs occur.  Plans may include using enrollment growth funds for targeted admissions, enhanced student support, and advising, recruiting, increases in faculty in necessary instructional areas that lead to certification, and other methods the Office of the President believes will achieve those results.  The Office of the President shall report back to the Office of State Budget and Management and the Joint Legislative Education Oversight Committee no later than December 30, 2005, on each campus's plan.  No later than March 31, 2006, the Office of the President shall submit a report on progress towards meeting this priority for the 2006-2007 academic year, based on each campus's current students in the education programs, and the students who have been accepted for the 2006-2007 fiscal year who are enrolling in the education programs.  The report shall also explain the distribution of enrollment growth funds by specific initiative.

SECTION 9.2.(b)  The Board of Governors of The University of North Carolina and the State Board of Community Colleges shall strongly encourage the constituent institutions and the community colleges that do not currently have 2 + 2 programs that emphasize teacher education to design and enter into formal partnerships to offer those 2 + 2 programs.  The Board of Governors and the Board of Community Colleges shall report to the Joint Legislative Education Oversight Committee by February 1, 2006, regarding the status of existing 2 + 2 programs and any new partnerships established.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

UNC-NCCCS JOINT INITIATIVE FOR TEACHER EDUCATION AND RECRUITMENT

SECTION 9.3.(a)  Funds appropriated in this act to The University of North Carolina for the UNC-NCCCS Joint Initiative for Teacher Education and Recruitment shall be used to establish eight  positions.  These individuals shall have an office in and work with staff in the Regional Alternative Licensure Centers of the Department of Public Instruction.  Their responsibilities are to assist in increasing the number of certified teachers in the public schools of North Carolina. To accomplish this, their specific tasks are as follows:

(1)       Resolve curriculum issues between The University of North Carolina campuses and the community colleges within each region to ensure seamless articulation;

(2)       Serve as licensure advisors to prospective teachers and assist with individual reviews for lateral entry candidates;

(3)       Offer admissions advice to community college students seeking to transfer to a four-year institution; and

(4)       Recruit prospective teachers on community college campuses.

Funds have been included in the appropriation to ensure these staff members can travel routinely among all the University System campuses and community college sites within a region.

SECTION 9.3.(b)  The results of this initiative shall be reported annually, and shall include at a minimum, the following performance outcomes by region in which the advisors are working:

(1)       Number of community college students articulated and working toward teacher licensure, their "base" community college, and The University of North Carolina institution to which they have moved;

(2)       Number of lateral entry teachers worked with by these advisors who are actively pursuing certification, and the number licensed;

(3)       Head count of the number of students in the process of receiving courses towards certification, their home county, where/at what institution(s) they are taking the course(s), and whether they are taking the course by regular attendance or via distance education (or the respective percentages if both methods are being employed);

(4)       Total full-time equivalencies (FTE's) and student credit hours that the head count in subdivision (3) of this subsection represents;

(5)       Articulation issues and curriculum changes effectively made as a result of these advisors; and

(6)       Articulation issues that are under discussion but have not been satisfactorily resolved.

SECTION 9.3.(c)  These results shall be reported by September 1, 2006, and annually thereafter to the State Board of Education, the Board of Governors of The University of North Carolina, the State Board of Community Colleges, the Education Cabinet, the Joint Legislative Education Oversight Commission, and the Office of State Budget and Management.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

ENROLLMENT GROWTH FUNDING MODEL

SECTION 9.4.  The Office of State Budget and Management, jointly with The University of North Carolina and the Fiscal Research Division of the General Assembly, shall conduct a comprehensive review of the enrollment funding model to review the assumptions contained within each element of the formula, to obtain current benchmark information related to specific elements within the formula, and to examine the impact of alternative elements and assumptions.  An alternative to the current model shall be the result of this analysis.  This alternative shall be used to prepare a request for enrollment growth funding for the budget to be submitted for the 2006 Session of the General Assembly and shall be shown in comparison to the use of the current formula.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

UNC-NCCCS 2+2 E-LEARNING INITIATIVE

SECTION 9.5.  Funds appropriated in this act to The University of North Carolina and the North Carolina Community College System for the UNC-NCCCS 2+2 E-Learning Initiative shall be used to fund further development of online courses for 2+2 programs.  Based on a mutually agreed upon decision by the State Board of Education Chairman, the President of the North Carolina Community College System, and the President of The University of North Carolina as to the areas of greatest need, funds are available to support joint technology development, systems to track student progress and articulation between a North Carolina community college and a University of North Carolina campus, and to develop technology to support online courses and 2+2 programs.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

USE OF ESCHEAT FUND FOR NEED-BASED FINANCIAL AID PROGRAMS

SECTION 9.6.(a)  There is appropriated from the Escheat Fund income to the Board of Governors of The University of North Carolina the sum of sixty-seven million two hundred forty-eight thousand sixteen dollars ($67,248,016) for fiscal year 2005-2006 and the sum of sixty-seven million six hundred thirty-eight thousand sixteen dollars ($67,638,016) for fiscal year 2006-2007; and to the State Board of Community Colleges the sum of thirteen million nine hundred eighty-one thousand two hundred two dollars ($13,981,202) for fiscal year 2005-2006 and the sum of thirteen million nine hundred eighty-one thousand two hundred two dollars ($13,981,202) for fiscal year 2006-2007. These funds shall be allocated by the North Carolina State Educational Assistance Authority (SEAA) for need-based student financial aid in accordance with G.S. 116B-7.

The SEAA shall perform all of the administrative functions necessary to implement this program of financial aid. The SEAA shall conduct periodic evaluations of expenditures of the Scholarship Programs to determine if allocations are utilized to ensure access to institutions of higher learning and to meet the goals of the respective programs. The SEAA may make recommendations for redistribution of funds to The University of North Carolina and the President of the Community College System regarding their respective scholarship programs, who then may authorize redistribution of unutilized funds for a particular fiscal year.

SECTION 9.6.(b)  There is appropriated from the Escheat Fund to the Board of Governors of The University of North Carolina the sum of seven hundred eighty thousand dollars ($780,000) for the 2005-2006 fiscal year and the sum of one million one hundred seventy thousand dollars ($1,170,000) for the 2006-2007 fiscal year to be allocated to the SEAA for need-based student financial aid to be used in accordance with G.S. 116B-7 and this act. The SEAA shall use these funds only to provide scholarship loans (known as the Millennium Teaching Scholarship Loan Program) to North Carolina high school seniors interested in preparing to teach in the State's public schools who also enroll at any of the Historically Black Colleges and Universities that do not have Teaching Fellows.  An allocation of 20 grants of six thousand five hundred dollars ($6,500) each shall be given to the three universities without any Teaching Fellows for the purposes specified in this subsection.

The SEAA shall administer these funds and shall establish any additional criteria needed to award these scholarship loans, the conditions for forgiving the loans, and the collection of the loan repayments when necessary.

SECTION 9.6.(c)  If the interest income generated from the Escheat Fund is insufficient to pay the appropriations made in subsections (a) and (b) of this section, the difference may be taken from the Escheat Fund principal to reach the appropriations referenced in this section; however, under no circumstances shall the Escheat Fund principal be reduced below the sum of four hundred million dollars ($400,000,000).

SECTION 9.6.(d)  All obligations to students for uses of the funds set out in sections that were made before the date this act becomes law shall be fulfilled as to students who remain eligible under the provisions of the respective programs.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

STUDY OF DISTANCE EDUCATION

SECTION 9.7.  The Office of State Budget and Management shall conduct a study to identify and analyze the distance education programs at the institutions in the University System. The study shall identify any duplication in course and program offerings, leader courses and programs at campuses in a particular area of study, the cost of developing online courses, and determine which campuses are best suited to offer a particular course or program of study. The findings of the study shall be reported to the Joint Legislative Education Oversight Committee no later than April 30, 2006.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

INFORMATION TECHNOLOGY PROCUREMENT

SECTION 9.8.  For purposes of purchasing hardware, software licenses, and multiyear maintenance agreements, The University of North Carolina and its constituent institutions may participate in the aggregation of purchasing administered by the Office of State Technology Services, as defined in G.S. 147-33.72F.  The Office of State Budget and Management shall conduct a cost comparison study of hardware, software license, and multiyear maintenance agreement purchases made by The University of North Carolina and its constituent institutions and by the Office of State Technology Services, to determine if further aggregation is cost-justified.  The Study shall also include an analysis of aggregated purchases by the University System and the effect of educational discounts available to the University System.  The report of comparative unit costs shall be completed by December 31, 2005.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

BOARD OF GOVERNORS' DENTAL SCHOLARSHIPS

SECTION 9.9.(a)  The current Board of Governors' Dental Scholarship Program, under the purview of the Board of Governors of The University of North Carolina, shall make any awards to students admitted after July 1, 2005, as scholarship loan awards.  The Board of Governors' Dental Scholarship Program is administered by the Board of Governors of The University of North Carolina.  The Board of Governors' Dental Scholarship Program shall be used to provide a four-year scholarship loan of relevant tuition and fees, mandatory medical insurance, required laptop computers for first-year students, required dental equipment, and an annual payment of five thousand dollars ($5,000) per year to students who have been accepted for admission to the School of Dentistry at the University of North Carolina at Chapel Hill.  The Board may adopt standards, including minimum grade point average and SAT scores, for awarding these scholarship loans to ensure that only the most qualified students receive them.  The Board shall make an effort to identify and encourage minority and economically disadvantaged youth to enter the program.  All scholarship loans shall be evidenced by notes made payable to the Board that shall bear interest at the rate of ten percent (10%) per year beginning September 1 after completion of the program, or immediately after termination of the scholarship loan, whichever is earlier.  The scholarship loan may be terminated by the recipient withdrawing from school or by the recipient not meeting the standards set by the Board.  The Board shall forgive the loan if, within seven years after graduation, the recipient practices dentistry in North Carolina for four years.  The Board shall also forgive the loan if it finds that it is impossible for the recipient to practice medicine in North Carolina for four years, within seven years after graduation, because of the death or permanent disability of the recipient.  All unused funds appropriated to or otherwise received by the Board for scholarships, all funds received as repayment of scholarship loans, and all interest earned on these funds shall revert to the General Fund at the end of each fiscal year.

SECTION 9.9.(b)  Any dental scholarship awarded prior to July 1, 2005, shall remain a scholarship and shall not be converted to a scholarship loan unless the recipient agrees to the conversion.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

BOARD OF GOVERNORS' MEDICAL SCHOLARSHIPS

SECTION 9.10.(a)  The current Board of Governors' Medical Scholarship Program, under the purview of the Board of Governors of The University of North Carolina, shall make any awards to students admitted after July 1, 2005, as scholarship loan awards. The Board of Governors' Medical Scholarship Program is administered by the Board of Governors of The University of North Carolina.  The Board of Governors' Medical Scholarship Program shall be used to provide a four-year scholarship loan of relevant tuition and fees, mandatory medical insurance, required laptop computers, and an annual payment of five thousand dollars ($5,000) per year to students who have been accepted for admission to either Duke University School of Medicine, Brody School of Medicine at East Carolina University, the University of North Carolina at Chapel Hill School of Medicine, or the Wake Forest University School of Medicine. The Board may adopt standards, including minimum grade point average and SAT scores, for awarding these scholarship loans to ensure that only the most qualified students receive them. The Board shall make an effort to identify and encourage minority and economically disadvantaged youth to enter the program. All scholarship loans shall be evidenced by notes made payable to the Board that shall bear interest at the rate of ten percent (10%) per year beginning September 1 after completion of the program, or immediately after termination of the scholarship loan, whichever is earlier. The scholarship loan may be terminated by the recipient withdrawing from school or by the recipient not meeting the standards set by the Board. The Board shall forgive the loan if, within seven years after graduation, the recipient practices medicine in North Carolina for four years. The Board shall also forgive the loan if it finds that it is impossible for the recipient to practice medicine in North Carolina for four years, within seven years after graduation, because of the death or permanent disability of the recipient. All unused funds appropriated to or otherwise received by the Board for scholarships, all funds received as repayment of scholarship loans, and all interest earned on these funds, shall revert to the General Fund at the end of each fiscal year.

SECTION 9.10.(b)  Any medical scholarship awarded prior to July 1, 2005, shall remain a scholarship and shall not be converted to a scholarship loan unless the recipient agrees to the conversion.

 

Requested by:            Senators Swindell, Lucas, Garrou, Dalton, Hagan

Teacher Scholarships Funds

SECTION 9.11.(a)  Article 23 of Chapter 116 of the General Statutes is amended by adding the following new section:

" 116-209.38.  Future Teachers of North Carolina Scholarship Loan Fund.

(a)       There is established the Future Teachers of North Carolina Scholarship Loan Fund. The purpose of the Fund is to provide a two-year scholarship loan of six thousand five hundred dollars ($6,500) per year for any North Carolina student pursuing a college degree to teach in the public schools of the State. The scholarship loan shall be paid only for the student's junior and senior years. The scholarship loan is available if the student is enrolled in a State institution of higher education or a private institution of higher education located in this State that has an accredited teacher preparation program for students planning to become certified teachers in North Carolina. The State Education Assistance Authority shall administer the Fund and shall award 100 scholarship loans annually.

(b)       The Board of Governors of The University of North Carolina, in consultation with the State Board of Education and the State Board of Community Colleges, shall develop the criteria for awarding the scholarship loans under this section and shall adopt very stringent standards for awarding these scholarship loans to ensure that only the best students receive them. Additional criteria for awarding a scholarship loan under this section shall include all of the following:

(1)       The student is one who either: (i) maintained a "B" or better average in college and is enrolled as a junior or senior in a teacher preparation program at any of the institutions described by subsection (a) of this section; or (ii) completed a college transfer curriculum at a community college in the State's community college system, maintained a "B" or better average in the community college courses, and is accepted and enrolled in a teacher preparation program at one of the institutions described by subsection (a) of this section.

(2)       The student agrees to become certified in math, science, special education, or English as a Second Language and teach full-time in that subject area in a North Carolina public school for three years within four years after graduation.

(3)       Any additional criteria that the Board of Governors of The University of North Carolina, in consultation with the State Board of Education and the State Board of Community Colleges, considers necessary to administer the Fund effectively.

(c)       If a student who is awarded a scholarship loan under this section fails to comply with the provisions of this section or the terms of the agreement awarding the scholarship loan, then the student shall repay the full amount of the scholarship loan provided to the student and the appropriate amount of interest as determined by the State Education Assistance Authority.

(d)       The Board of Governors of The University of North Carolina, the State Board of Education, and the State Board of Community Colleges shall: (i) prepare a clear written explanation of the Future Teachers of North Carolina Scholarship Fund and the information regarding the availability and criteria for awarding the scholarship loans, and (ii) shall provide that information to the appropriate counselors in each local school system and the appropriate institutions of higher education and shall charge those counselors to inform students about the scholarship loans and to encourage them to apply for the scholarship loans.

(e)       The Board of Governors of The University of North Carolina shall adopt rules to implement this section.

(f)        The Board of Governors of The University of North Carolina shall report to the Joint Legislative Education Oversight Committee by March 1 each year regarding the Fund and scholarship loans awarded from the Fund."

SECTION 9.11.(b)  Of the funds appropriated in this act to the State Education Assistance Authority the sum of six hundred fifty thousand dollars ($650,000) for the 2005-2006 fiscal year and the sum of one million three hundred thousand dollars ($1,300,000) for the 2006-2007 fiscal year shall be used to implement this act.

 

Requested by:            Senators Lucas, Swindell, Nesbitt, Garrou, Dalton, Hagan

UNC-Asheville Retain Sale Proceeds

SECTION 9.12.  Notwithstanding any other provision of law, the University of North Carolina at Asheville may retain the proceeds from the sale of its existing chancellor's residence and appurtenant land. The University of North Carolina at Asheville may use the proceeds from the sale of its existing chancellor's residence and the appurtenant land to construct or otherwise acquire a new chancellor's residence. Proceeds from the sale not used for that purpose within two fiscal years of the sale shall revert to the General Fund.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

UNC BOND PROJECT MODIFICATIONS

SECTION 9.13.(a)  Pursuant to Section 2(b) of S.L. 2000-3, the General Assembly finds that it is in the best interest of the State to respond to current educational and research program requirements at Elizabeth City State University by changing the scope of "Mitchell-Lewis Residence Hall-Comprehensive Renovation" to be a replacement project instead of a renovation. Section 2(a) of S.L. 2000-3 is therefore amended in the portion under Elizabeth City State University by replacing "Mitchell Lewis Residence Hall-Comprehensive Renovation" with "Mitchell Lewis Residence Hall-Replacement."

SECTION 9.13.(b)  Pursuant to Section 2(b) of S.L. 2000-3, the General Assembly finds that it is in the best interest of the State to respond to current educational and research program requirements at North Carolina Central University by the cancellation of "Latham Residence Hall-Comprehensive Renovation". The unused monies from "Latham Residence Hall-Comprehensive Renovation," should be transferred to "Eagleson Residence Hall-Comprehensive Renovation". Section 2(a) of S.L. 2000-3 is therefore amended in the portion under North Carolina Central University by reducing the money allocated to "Latham Residence Hall-Comprehensive Renovation" by reducing that amount by two million three hundred seventy-three thousand four hundred fifty-seven dollars ($2,373,457) to a total of one million thirty-eight thousand one hundred forty-three dollars ($1,038,143) and by increasing the allocation to "Eagleson Residence Hall-Comprehensive Renovation" by two million three hundred seventy-three thousand four hundred fifty-seven dollars ($2,373,457) to create a total allocation of nine million two hundred forty-two thousand nine hundred fifty-seven dollars ($9,242,957).

SECTION 9.13.(c)  Pursuant to Section 2(b) of S.L. 2000-3, the General Assembly finds that it is in the best interest of the State to respond to current educational and research program requirements at the University of North Carolina at Wilmington by the cancellation of "King Hall Classroom Building-Comprehensive Renovation", and by transferring the unused funds to the following projects listed under the portion entitled University of North Carolina at Wilmington:  "Academic & Classroom Facilities," "General Classroom Bldg,", "Hinton James Hall Classroom Bldg. - Comprehensive Renovation," "Friday Hall Laboratory Bldg. - Comprehensive Renovation," "Kenan Auditorium - Comprehensive Renovation." Section 2(a) of S.L. 2000-3 is therefore amended in the portion under the University of North Carolina at Wilmington by:

(1)       Reducing the allocation to "King Hall Classroom Building - Comprehensive Renovation" by three million one hundred sixty-eight thousand six hundred eighty-nine dollars ($3,168,689) to create a total allocation of three hundred fifty-eight thousand seven hundred eleven dollars ($358,711).

(2)       Increasing the allocation to "General Classroom Building" by six hundred seventy-nine thousand seven hundred seventy-eight dollars ($679,778) to create a total allocation of thirteen million three hundred twenty-six thousand seven hundred seventy-eight dollars ($13,326,778).

(3)       Increasing the allocation to "Academic & Classroom Facilities" by nine hundred ninety-one thousand one hundred twenty-three dollars ($991,123) to create a total allocation of thirty-four million twenty-three thousand two hundred twenty-three dollars ($34,023,223).

(4)       Increasing the allocation to "Hinton James Hall Classroom Building - Comprehensive Renovation" by one hundred seventy-six thousand six hundred nine dollars ($176,609) to create a total allocation of two million eight hundred six thousand five hundred sixty-one dollars ($2,806,561).

(5)       Increasing the allocation to "Kenan Auditorium - Comprehensive Renovation" by one hundred fifty-one thousand seven hundred forty-nine dollars ($151,749) to create a total allocation of two million seventy-three thousand seven hundred twenty-four dollars ($2,073,724).

(6)       Increasing the allocation to "Friday Hall Laboratory Building - Comprehensive Renovation" by one million one hundred sixty-nine thousand four hundred thirty dollars ($1,169,430) to create a total allocation of eight million eight hundred sixty-two thousand eight hundred thirty dollars ($8,862,830).

SECTION 9.13.(d)  Pursuant to Section 2(b) of S.L. 2000-3, the General Assembly finds that it is in the best interest of the State to respond to current educational and research program requirements at the University of North Carolina at Pembroke by the cancellation of "West Residence Hall - Comprehensive Renovation" and by transferring the unused funds to a new project, "North and Belk Residence Halls-Fire Safety Improvements and Renovations" and by the cancellation of "Campuswide Infrastructure Improvements" and by transferring those unused funds to a new project, "Biotechnology Teaching Labs and Classroom Building". Section 2(a) of S.L. 2000-3 is therefore amended in the portion under University of North Carolina at Pembroke by:

(1)       Reducing the allocation to "West Residence Hall - Comprehensive Renovation" by eight hundred seventy-nine thousand three hundred dollars ($879,300) to a total allocation of ninety-eight thousand dollars ($98,000).

(2)       Reducing the allocation to "Campuswide Infrastructure Improvements" by one million seven hundred thirty thousand three hundred eighty-two dollars ($1,730,382) to a total allocation of two hundred sixty-six thousand two hundred eighteen dollars ($266,218).

(3)       Adding a new project entitled "North and Belk Residence Halls - Fire Safety Improvements and Renovations $879,300".

(4)       Adding a new project entitled "Biotechnology Teaching Labs and Classroom Building $1,730,382".

SECTION 9.13.(e)  Nothing in this section is intended to supersede any other requirement of law or policy for approval of the substituted capital improvement projects.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

AMEND NC SCHOOL OF SCIENCE AND MATH TUITION GRANT

SECTION 9.14.(a)  G.S. 116-238.1(f) reads as rewritten:

"(f)      Notwithstanding any other provision of this section, no tuition grant awarded to a student under this section shall exceed the cost of tuition of attendance at the constituent institution at which the student is enrolled. If a student, who is eligible for a tuition grant under this subsection, also receives a scholarship or other grant covering the cost of tuition attendance at the constituent institution for which the tuition grant is awarded, then the amount of the tuition grant shall be reduced by an appropriate amount determined by the State Education Assistance Authority. The State Education Assistance Authority shall reduce the amount of the tuition grant so that the sum of all grants and scholarship aid covering the cost of tuition attendance received by the student, including the tuition grant under this section, shall not exceed the cost of tuition attendance for the constituent institution at which the student is enrolled. The cost of attendance, as used in this subsection, shall be determined by the State Education Assistance Authority for each constituent institution."

SECTION 9.14.(b)  This section applies to any eligible student who is enrolled full-time in The University of North Carolina after July 1, 2005.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

UNC-CHAPEL HILL CONTINUE TO OPERATE HORACE WILLIAMS AIRPORT

SECTION 9.15.  The University of North Carolina at Chapel Hill shall operate the Horace Williams Airport and continue air transportation support for the Area Health Education Centers (AHEC) and the public from that location until AHEC's Medical Air Operations have access to, or utilize, the Raleigh-Durham International Airport (RDU) on a basis sufficient to serve adequately the needs of patients, physicians, and passengers associated with AHEC's statewide programs and activities. At that time, the University of North Carolina at Chapel Hill may close the Horace Williams Airport.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

North Carolina Agricultural and Technical State University Funds

SECTION 9.16.  Of the funds appropriated by this act to the Board of Governors of The University of North Carolina for the 2005-2006 fiscal year the sum of one million eighty-eight thousand nine hundred forty-one dollars ($1,088,941) shall be allocated to North Carolina Agricultural and Technical State University for agricultural and research extension programs.  It is the intent of the General Assembly to fully fund these programs for the 2006-2007 fiscal year.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

TRANSFER PROSPECTIVE TEACHER SCHOLARSHIP LOAN AND TEACHER ASSISTANT SCHOLARSHIP LOAN TO THE NC STATE EDUCATION ASSISTANCE AUTHORITY

SECTION 9.17.(a)  The Scholarship Loan Fund for Prospective Teachers is transferred from the Department of Public Instruction to the State Education Assistance Authority.  This transfer shall have all of the elements of a Type I transfer, as defined in G.S. 143A-6.

SECTION 9.17.(b)  G.S. 115C-468 is recodified as G.S. 116-209.33. G.S. 115C-469, 115C-470, and 115C-472.1 are repealed. G.S. 115C-471 is recodified as G.S. 116-209.34.

SECTION 9.17.(c)  G.S. 115C-468 recodified by subsection (b) of this section as G.S. 116-209.33 reads as rewritten:

" 116-209.33.  Establishment of fund.Scholarship Loan Fund for Prospective Teachers.

(a)       There is established a revolving fund known as the "Scholarship Loan Fund for Prospective Teachers". The purpose of the Fund is to provide scholarship loans to qualified individuals who are pursuing college degrees to become teachers. The State Education Assistance Authority shall administer the Fund.

(b)       Criteria The State Education Assistance Authority, in consultation with the State Board of Education, shall develop criteria for awarding scholarship loans from the fund shall include measures the Fund. These criteria shall include:

(1)       Measures of academic performance including grade point averages, scores on standardized tests, class rank, and recommendations of guidance counselors and principals.

(2)       North Carolina residency. - For purposes of this section, residency shall be determined by the same standard as residency for tuition purposes pursuant to G.S. 116-143.1.

(3)       The geographic areas or subjects of instruction in which the demand for teachers is greatest.

(4)       To the extent practical, an equal number of scholarships shall be awarded in each of the State's Congressional Districts.

(5)       Any additional criteria that the State Education Assistance Authority considers necessary to administer the Fund effectively, including the following:

a.         Consideration of the appropriate numbers of minority applicants and applicants from diverse socioeconomic backgrounds to receive scholarships pursuant to this section.

b.         Consideration of the commitment an individual applying to receive funds demonstrates to the profession of teaching.

(c)       The Superintendent of Public InstructionState Education Assistance Authority may earmark each year up to twenty percent (20%) of the funds available for scholarship loans each yearunder this section for awards to applicants who have been employed for at least one year as teacher assistants and who are currently employed as teacher assistants. Preference for these scholarship loans from funds earmarked for teacher assistants shall be given first to applicants who worked as teacher assistants for at least five years and whose positions as teacher assistants were abolished and then to applicants who already hold a baccalaureate degree or who have already been formally admitted to an approved teacher education program in North Carolina. The criteria for awarding scholarship loans to applicants who worked as teacher assistants for at least five years and whose positions as teacher assistants were abolished shall include whether the teacher assistant has been admitted to an approved teacher education program in North Carolina.for the Teacher Assistant Scholarship Fund established in G.S. 116-209.35.

The Superintendent of Public Instruction may further earmark a portion of these funds each year for two-year awards to applicants who have been employed for at least one year as teacher assistants to attend community colleges to get other skills of use in public schools or to get an early childhood associate degree. The provisions of this Article shall apply to these scholarship loans except that a recipient of one of these scholarship loans may receive credit upon the amount due by reason of the loan as provided in G.S. 115C-471(5) or by working in a nonteaching position in the North Carolina public schools or by working in a licensed child care center in North Carolina."

SECTION 9.17.(d)  G.S. 115C-471 recodified by subsection (b) of this section as G.S. 116-209.34 reads as rewritten:

" 116-209.34.  Fund administered by State Superintendent of Public Instruction; rules and regulations.State Education Assistance Authority; rule-making authority.

(a)       The Scholarship Loan Fund for Prospective Teachers shall be administered by the State Superintendent of Public Instruction, under rules adopted by the State Board of Education and subject to the following directions and limitations:The State Education Assistance Authority shall establish the terms and conditions for the scholarship loans consistent with the following:

(1)       Any resident of North Carolina who is interested in preparing to teach in the public schools of the State may apply in writing to the State Superintendent of Public Instruction for a regular scholarship loan in the amount of not more than two thousand five hundred dollars ($2,500) per academic school year. An applicant who has been employed for at least one year as a teacher assistant and who is currently employed as a teacher assistant may apply for a scholarship loan from funds earmarked for teacher assistants in the amount of not more than one thousand two hundred dollars ($1,200) per academic school year.The loan amount shall be not more than four thousand dollars ($4,000) per academic school year for a maximum of four years for applicants who are pursuing a college degree to become a teacher.

(2)       All scholarship loans shall be evidenced by notes made payable to the State Board of Education Authority that bear interest at the rate of ten percent (10%) per annum from and after September 1 following fulfillment by a prospective teacher of the requirements for a certificate based upon the entry level degree; or in the case of persons already teaching in the public schools who obtain scholarship loans, the notes shall bear interest at the prescribed rate from and after September 1 of the school year beginning immediately after the use of the scholarship loans; or in the event any such scholarship is terminated under the provisions of subdivision (3) of this section, the notes shall bear interest from the date of termination. A minor recipient who signs a note shall also obtain the endorsement thereon by a parent, if there be a living parent, unless the endorsement is waived by the Superintendent of Public Instruction. The minor recipient shall be obligated upon the note as fully as if the recipient were of age and shall not be permitted to plead such minority as a defense in order to avoid the obligations undertaken upon the notes.year, beginning September 1 after graduation, or immediately after termination of the scholarship loan, whichever is earlier.

(3)       Each recipient of a scholarship loan under the provisions of this program shall be eligible for scholarship loans each year until the recipient has qualified for a certificate based upon the entry level degree, but the recipient shall not be so eligible for more than the minimum number of years normally required for qualifying for the certificate. The permanent withdrawal of any recipient from college or failure of the recipient to do college work in a manner acceptable to the State Superintendent of Public Instruction shall immediately forfeit the recipient's right to retain the scholarship and subject the scholarship to termination by the State Superintendent of Public Instruction in the Superintendent's discretion. A scholarship loan shall be terminated upon the recipient's withdrawing from school or a finding by the Authority that the recipient fails to meet the standards set by the Authority. All terminated scholarships shall be regarded as vacant and subject to being awarded to other eligible persons.

(4)       Except under emergency conditions applicable to the State Superintendent of Public Instruction, recipients of scholarship loans shall enter the public school system of North Carolina at the beginning of the next school term after qualifying for a certificate based upon the entry level degree or, in case of persons already teaching in the public schools, at the beginning of the next school term after the use of the loan. All teaching service for which the recipient of any scholarship loan is obligated shall be rendered by August 31 of the seventh school year following graduation.

(5)(4)  For each full school year taught in a North Carolina public school, the recipient of a scholarship loan shall receive credit upon the amount due by reason of the loan equal to the loan amount for a school year as provided in the note plus credit for the total interest accrued on that amount. Also, the recipient of the loan shall receive credit upon the total amount due by reason of all four years of the loan if the recipient teaches for three consecutive years, The Authority shall forgive a four-year loan if, within seven years after graduation, the recipient teaches for four years at a North Carolina public school or at a school operated by the United States government in North Carolina. The Authority shall also forgive a four-year loan if, within seven years after graduation, the recipient teaches for three consecutive years, or for three years interrupted only by an approved leave of absence, at a North Carolina public school that is in a low-performing school system or a school system on warning status at the time the recipient accepts employment with the local school administrative unit. In lieu of teaching in the public school, a recipient may elect to pay in cash the full amount of scholarship loans received plus interest then due thereon or any part thereof that has not been canceled by the State Board of Education by reason of teaching service rendered.For loans of less than four years, the Authority shall forgive one year for each year the recipient teaches, within four years of graduation, at a North Carolina public school or a school operated by the United States government in North Carolina.

(6)(5)  If any recipient of a scholarship loan dies during the period of attendance at a college or university under a scholarship loan or before the scholarship loan is satisfied by payment or teaching service, any balance shall be automatically canceled.

If any recipient of a scholarship loan fails to fulfill the recipient's obligations under subdivision (4) of this section, other than as provided above, the amount of the loan and accrued interest, if any, shall be due and payable from the time of failure to fulfill the recipient's obligations. The Authority may forgive or reduce any loan payment if the Authority considers that extenuating circumstances exist that would make teaching or repayment impossible.

(7)(6)  The State Superintendent of Public Instruction shall award scholarship loans with due consideration to factors and circumstances such as aptitude, purposefulness, scholarship, character, financial need, and geographic areas or subjects of instruction in which the demands for teachers are greatest. Since the primary purpose of this Article is to attract worthy young people to the teaching profession, preference for scholarship loans, except for the scholarship loans from funds earmarked for teacher assistants, shall be given to high school seniors in the awarding of scholarships. In awarding scholarship loans from funds earmarked for teacher assistants, preference shall be given to applicants who have already earned a baccalaureate degree or who have been formally admitted to an approved teacher education program in North Carolina.The Authority shall ensure that all repayments, including the accrued interest, are placed in the Fund.

(b)       The State Education Assistance Authority, in consultation with the State Board of Education, shall adopt rules to implement G.S. 116-209.33, 116-209.34, and 116-209.35."

SECTION 9.17.(e)  This section becomes effective January 1, 2006, and applies to scholarship loans awarded on or after that date.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

University System and Community College System Joint Study of Higher Education Strategy/Amend Reporting Requirement

SECTION 9.18.  Section 6.2 of S.L. 2004-179 reads as rewritten:

"SECTION 6.2. These studies shall be designed to provide information and recommendations that will assist the General Assembly in setting priorities for funding to address the strategic higher education needs of the State. The Board of Governors, the State Board, and their consultant shall periodically report their findings to a higher education programming subcommittee of the Joint Legislative Education Oversight Committee. The two boards and their consultant shall report the preliminary results of the study to the General Assembly and to the Joint Legislative Education Oversight Committee by April 15, 2005, June 15, 2005, and shall file a final report and recommendations with the General Assembly and the Joint Legislative Education Oversight Committee no later than December 31, 2005.December 31, 2006."

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

UNC Research Institutions May Increase Tuition

SECTION 9.19.(a)  G.S. 116-143 reads as rewritten:

" 116-143.  State-supported institutions of higher education required to charge tuition and fees.

The Except as provided in G.S. 116-143.6, the Board of Governors of the University of North Carolina shall fix the tuition and fees, not inconsistent with actions of the General Assembly, at the institutions enumerated in G.S. 116-4 in such amount or amounts as it may deem best, taking into consideration the nature of each institution and program of study and the cost of equipment and maintenance; and each institution shall charge and collect from each student, at the beginning of each semester or quarter, tuition, fees, and an amount sufficient to pay other expenses for the term.

In the event that said students are unable to pay the cost of tuition and required academic fees as the same may become due, in cash, the said several boards of trustees are hereby authorized and empowered, in their discretion, to accept the obligation of the student or students together with such collateral or security as they  may deem necessary and proper, it being the purpose of this Article that all students in State institutions of higher learning shall be required to pay tuition, and that free tuition is hereby abolished.

Inasmuch as the giving of tuition and fee waivers, or especially reduced rates, represent in effect a variety of scholarship awards, the said practice is hereby prohibited except when expressly authorized by statute or by the Board of Governors of the University of North Carolina; and, furthermore, it is hereby directed and required that all budgeted funds expended for scholarships of any type must be clearly identified in budget reports.

Notwithstanding the above provision relating to the abolition of free tuition, the Board of Governors of the University of North Carolina may, in its discretion, provide regulations under which a full-time faculty member of the rank of full-time instructor or above, and any full-time staff member of the University of North Carolina may during the period of normal employment enroll for not more than one course per semester in the University of North Carolina free of charge for tuition, provided such enrollment does not interfere with normal employment obligations and further provided that such enrollments are not counted for the purpose of receiving general fund appropriations."

SECTION 9.19.(b)  Article 14 of Chapter 116 of the General Statutes is amended by adding a new section to read:

" 116-143.6.  Board of Trustees of a Doctoral/Research University-Extensive campus may increase tuition without approval of the Board of Governors.

(a)       Notwithstanding G.S. 116-11(7) and G.S. 116-143, the Board of Trustees of a constituent institution designated as a Doctoral/Research University-Extensive campus of The University of North Carolina may set undergraduate tuition for an academic year. In considering tuition, the Boards of Trustees shall take into account that undergraduate tuition for North Carolina residents shall remain affordable to ensure accessibility, as required by Section 9 of Article IX of the North Carolina Constitution, and shall take the appropriate steps to increase financial aid accordingly and to ensure that the annual undergraduate in-State tuition rate remains in the lowest quartile of that constituent institution's national public peers.

Any additional revenues derived from a tuition increase set under this section shall remain available for use on that campus and are in addition to the operating budgets approved by the General Assembly.

(b)       If a Board of Trustees decides to increase tuition at a constituent institution, the institution shall notify the Board of Governors, the Office of State Budget and Management, and the Fiscal Research Division of the amount of increase, additional receipts anticipated, and the allocation of the funds among various programs in a format prescribed by the Board of Governors of The University of North Carolina."

SECTION 9.19.(c)  This section applies to the 2005-2006 academic year and each subsequent academic year.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

NC Space Grant Consortium Funds

SECTION 9.20.  Funds appropriated by this act to the North Carolina Space Grant Consortium shall be allocated only to constituent institutions of The University of North Carolina participating in the Consortium; no funds shall be allocated to any private institution as defined by G.S. 116-15(a2) that participates in the Consortium.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

Distinguished Professors Endowment Trust Fund

SECTION 9.21.(a)  G.S. 116-41.15 reads as rewritten:

" 116-41.15.  Distinguished Professors Endowment Trust Fund; allocation; administration.

(a)       For constituent institutions other than focused growth institutions and special needs institutions, the amount appropriated to the trust shall be allocated by the Board as follows:

(1)       On the basis of one three hundred thirty-four thousand dollar ($334,000) challenge grant for each six hundred sixty-six thousand dollars ($666,000) raised from private sources; or

(2)       On the basis of one one hundred sixty-seven thousand dollar ($167,000) challenge grant for each three hundred thirty-three thousand dollars ($333,000) raised from private sources.sources; or

(3)       On the basis of one challenge grant of up to six hundred sixty-seven thousand dollars ($667,000) for funds raised from private sources in twice the amount of the challenge grant.

If an institution chooses to pursue the use of the allocated challenge grant funds described in either subdivision (1) or(1), subdivision (2) (2), or subdivision (3) of this subsection, the challenge grant funds shall be matched by funds from private sources on a two-to-one basis.the basis of two dollars of private funds for every one dollar of State funds.

(b)       For focused growth institutions and special needs institutions, the amount appropriated to the trust shall be allocated by the Board as follows:

(1)       On the basis of one five hundred thousand dollar ($500,000) challenge grant for each five hundred thousand dollars ($500,000) raised from private sources; or

(2)       On the basis of one two hundred fifty thousand dollar ($250,000) challenge grant for each two hundred fifty thousand dollars ($250,000) raised from private sources.sources; or

(3)       On the basis of one challenge grant of up to one million dollars ($1,000,000) for funds raised from private sources in the same amount as the challenge grant.

If an institution chooses to pursue the use of the allocated challenge grant funds described in either subdivision (1) or(1), subdivision (2)(2), or subdivision (3) of this subsection, the challenge grant funds shall be matched by funds from private sources on a one-to-one basis.the basis of one dollar of private funds for every dollar of State funds.

(c)       Matching funds shall come from contributions made after July 1, 1985, and pledged for the purposes specified by G.S. 116-41.14. Each participating constituent institution's board of trustees shall establish its own Distinguished Professors Endowment Trust Fund, and shall maintain it pursuant to the provision of G.S. 116-36 to function as a depository for private contributions and for the State matching funds for the challenge grants. The State matching funds shall be transferred to the constituent institution's Endowment Fund upon notification that the institution has received and deposited the appropriate amount required by this section in its own Distinguished Professors Endowment Trust Fund. Only the net income from that account shall be expended in support of the distinguished professorship thereby created."

SECTION 9.21.(b)  G.S. 116-41.16 reads as rewritten:

" 116-41.16.  Distinguished Professors Endowment Trust Fund; contribution commitments.

(a)       For constituent institutions other than focused growth institutions and special needs institutions, contributions may also be eligible for matching if there is:

(1)       A commitment to make a donation of at least six hundred sixty-six thousand dollars ($666,000), as prescribed by G.S. 143-31.4, and an initial payment of one hundred eleven thousand dollars ($111,000) to receive a grant described in G.S. 116-41.15(a)(1); or

(2)       A commitment to make a donation of at least three hundred thirty-three thousand dollars ($333,000), as prescribed by G.S. 143-31.4, and an initial payment of fifty-five thousand five hundred dollars ($55,500) to receive a grant described in G.S. 116-41.15(a)(2);(2); or

(3)       A commitment to make a donation in excess of six hundred sixty-six thousand dollars ($666,000), as prescribed by G.S. 143-31.4, and an initial payment of one-sixth of the committed amount to receive a grant described in G.S. 116-41.15(a)(3);

and if the initial payment is accompanied by a written pledge to provide the balance within five years after the date of the initial payment. Each payment on the balance shall be no less than the amount of the initial payment and shall be made on or before the anniversary date of the initial payment. Pledged contributions may not be matched prior to the actual collection of the total funds. Once the income from the institution's Distinguished Professors Endowment Trust Fund can be effectively used pursuant to G.S. 116-41.17, the institution shall proceed to implement plans for establishing an endowed chair.

(b)       For focused growth institutions and special needs institutions, contributions may also be eligible for matching if there is:

(1)       A commitment to make a donation of at least five hundred thousand dollars ($500,000), as prescribed by G.S. 143-31.4, and an initial payment of eighty-three thousand three hundred dollars ($83,300) to receive a grant described in G.S. 116-41.5(b)(1); or

(2)       A commitment to make a donation of at least two hundred fifty thousand dollars ($250,000), as prescribed by G.S. 143-31.4, and an initial payment of forty-one thousand six hundred dollars ($41,600) to receive a grant described in G.S. 116-41.15(b)(2);(2); or

(3)       A commitment to make a donation in excess of five hundred thousand dollars ($500,000), as prescribed by G.S. 143-31.4, and an initial payment of one-sixth of the committed amount to receive a grant described in G.S. 116-41.15(b)(3);

and if the initial payment is accompanied by a written pledge to provide the balance within five years after the date of the initial payment. Each payment on the balance shall be no less than the amount of the initial payment. Pledged contributions may not be matched prior to the actual collection of the total funds. Once the income from the institution's Distinguished Professors Endowment Trust Fund can be effectively used pursuant to G.S. 116-41.17, the institution shall proceed to implement plans for establishing an endowed chair."

SECTION 9.21.(c)  G.S. 116-41.17 reads as rewritten:

" 116-41.17.  Distinguished Professors Endowment Trust Fund; establishment of chairs.

When the sum of the challenge grant and matching funds in the Scholars' Distinguished Professors Endowment Trust Fund reaches:

(1)       One million dollars ($1,000,000), if the sum of funds described in G.S. 116-41.15(1); or G.S. 116-41.15(a)(1) or G.S. 116-41.15(b)(1); or

(2)       Five hundred thousand dollars ($500,000), if the sum of funds described in G.S. 116-41.15(2);G.S.  116-41.15(a)(2) or G.S. 116-41.15(b)(2); or

(3)       An amount up to two million dollars ($2,000,000), if the sum of funds described in G.S. 116-41.15(a)(3) or G.S. 116-41.15(b)(3);

the board of trustees may recommend to the Board, for its approval, the establishment of an endowed chair or chairs. The Board, in considering whether to approve the recommendation, shall include in its consideration the programs already existing in The University of North Carolina. If the Board approves the recommendation, the chair or chairs shall be established. The chair or chairs, the property of the constituent institution, may be named in honor of a donor, benefactor, or honoree of the institution, at the option of the board of trustees."

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

UnC MAY encourage the ESTABLISHment of PRIVATE, NONPROFIT CORPORATIONS TO SUPPORT THE UNIVERSITY SYSTEM AND ASSIGN unc EMPLOYEES TO ASSIST WITH THOSE CORPORATIONS

SECTION 9.22.  Article 1 of Chapter 116 of the General Statutes is amended by adding a new Part to read:

"Part 2B. Private, Nonprofit Corporations.

" 116-30.20.  Establishment of private, nonprofit corporations.

The Board of Governors of The University of North Carolina shall encourage the establishment of private, nonprofit corporations to support the constituent institutions of The University of North Carolina and The University System. The President of The University of North Carolina and the chancellors of the constituent institutions may assign employees to assist with the establishment and operation of a nonprofit corporation and may make available to the corporation office space, equipment, supplies, and other related resources; provided, the sole purpose of the corporation is to support The University of North Carolina or one or more of its constituent institutions.

The board of directors of each such private, nonprofit corporation shall secure and pay for the services of The University System's internal auditors or employ a certified public accountant to conduct an audit of the financial accounts of the corporation. The board of directors shall transmit to the Board of Governors a copy of the annual financial audit report of the private, nonprofit corporation."

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

Eliminate Reporting Requirement for School Administrator Training Programs

SECTION 9.23.  G.S. 116-74.21 reads as rewritten:

" 116-74.21.  Establishment of a competitive proposal process for school administrator programs.

(a)       The Board of Governors shall develop and implement a competitive proposal process and criteria for assessing proposals to establish school administrator training programs within the constituent institutions of The University of North Carolina. To facilitate the development of the programs, program criteria, and the proposal process, the Board of Governors may convene a panel of national school administrator program experts and other professional training program experts to assist it in designing the program, the proposal process, and criteria for assessing the proposals.

(b)       No more than 12 school administrator programs shall be established under the competitive proposal program. In selecting campus sites, the Board of Governors shall be sensitive to the racial, cultural, and geographic diversity of the State. Special priority shall be given to the following factors: (i) the historical background of the institutions in training educators; (ii) the ability of the sites to serve the geographic regions of the State, such as, the far west, the west, the triad, the piedmont, and the east; and, (iii) whether the type of roads and terrain in a region make commuting difficult. A school administrator program may provide for instruction at one or more campus sites.

(c)       The Board of Governors shall study the issue of supply and demand of school administrators to determine the number of school administrators to be trained in the programs in each year of each biennium. The Board of Governors shall report the results of this study to the Joint Legislative Education Oversight Committee no later than March 1, 1994, and annually thereafter.the biennium and report the results of this study to the Joint Legislative Education Oversight Committee no later than March 1 annually.

(d)       The Board of Governors shall develop a budget for the programs established under subsection (a) of this section that reflects the resources necessary to establish and operate school administrator programs that meet the vision of the report submitted to the 1993 General Assembly by the Educational Leadership Task Force.

(e)       The Board of Governors shall report annually on the implementation of the act no later than December 1 of each year."

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

Continue Academic Common Market Program

SECTION 9.24.  Section 31.2 of S.L. 2001-424 reads as rewritten:

"Academic Common Market pilot Program

SECTION 31.2.(a)  The Southern Regional Education Board currently operates an Academic Common Market program. Under this program, qualified students from participating states may apply to attend programs at public universities in participating states that are not available in their home state's university system. North Carolina's participation for graduate programs would provide a cost-effective means of offering educational access for North Carolina residents. North Carolinians would will be able to attend graduate programs that are not available at The University of North Carolina at reduced rates, and the State would avoid the cost associated with the development of new academic programs.

SECTION 31.2.(b)  The Board of Governors of The University of North Carolina may establish a pilot program for continue participation in the Southern Regional Education Board's Academic Common Market at the graduate program level. The Board of Governors shall examine the graduate programs offered in The University of North Carolina system and select for participation only those graduate programs that are likely to be unique or are not commonly available in other Southern Regional Education Board states. Out-of-state tuition shall be waived for students who are residents of other Southern Regional Education Board states and who are participating in the Academic Common Market program. If accepted into The University of North Carolina graduate programs that are part of the Academic Common Market, these students shall pay in-State tuition and shall be treated for all purposes of The University of North Carolina as residents of North Carolina.  Prior to the beginning of this pilot, the Board of Governors shall submit its list of graduate programs selected to be a part of the pilot program to the Joint Legislative Education Oversight Committee.

SECTION 31.2.(c)  The pilot programs established under this section shall terminate July 1, 2005. However, once Once a student is enrolled in The University of North Carolina system under the Academic Common Market program, the student shall be entitled to pay in-State tuition as long as the student is enrolled in that graduate program. The Board of Governors shall report the success of provide a report on the Academic Common Market program to the Joint Legislative Education Oversight Committee by December 31, 2003, and by January 31, 2005, and the Committee may recommend changes, if any are appropriate, to the pilot program at either of those times.September 2007, and each biennium thereafter."

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

Tuition Waiver Program Expansion

SECTION 9.25.(a)  G.S. 116-143.1 is amended by adding a new subsection to read:

"(m)     Notwithstanding subsection (b) of this section, a person who is a full-time employee of The University of North Carolina, or is the spouse or dependent child of a full-time employee of The University of North Carolina, and who is a legal resident of North Carolina, qualifies as a resident for tuition purposes without having maintained that legal residence for at least 12 months immediately prior to his or her classification as a resident for tuition purposes."

SECTION 9.25.(b)  The Board of Governors of The University of North Carolina and the State Board of Community Colleges shall study the feasibility of a tuition waiver exchange program under which full-time employees of The University of North Carolina would be allowed to take a specified number of courses at a community college without paying tuition, and full-time employees of a community college would be allowed to take a specified number of courses at a constituent institution of The University of North Carolina without paying tuition.  The Boards shall report the results of this study to the Joint Legislative Education Oversight Committee by April 1, 2006.

 

Requested by:            Senators Lucas, Swindell, Kerr, Jenkins, Garrou, Dalton, Hagan

Brody School of Medicine at ECU/Medicare Receipts/family medicine center

SECTION 9.26.(a)  G.S. 116-36.6 reads as rewritten:

" 116-36.6.  Brody School of Medicine at East Carolina University School of Medicine; University; Medicare receipts.

The Brody School of Medicine at East Carolina University School of Medicine shall request, on a regular basis consistent with the State's cash management plan, funds earned by the School from Medicare reimbursements for education costs. Upon receipt, these funds shall be allocated as follows:

(1)       The portion of the Medicare reimbursement generated through the effort and expense of the Brody School of Medicine's Medical Faculty Practice Plan shall be transferred to the appropriate Medical Faculty Practice Plan account within the School of Medicine. The Medical Faculty Practice Plan shall assume responsibility for any of these funds that subsequently must be refunded due to final audit settlements.

(2)       The funds from this source budgeted by the General Assembly as part of the School of Medicine's General Fund budget code shall be credited to that code as a receipt.

(3)       The remainder of the funds shall be transferred to a special fund account on deposit with the State Treasurer. This special fund account shall be used for any necessary repayment of Medicare funds due to final audit settlements for funds allocated under subdivision (2) of this subsection. When the amount of these reimbursement funds has been finalized by audit for each year, those funds remaining in the special fund shall be available for specific capital improvement projects for the East Carolina University School of Medicine. Requests by East Carolina University for use of these funds shall be made to the Board of Governors of The University of North Carolina. Approval of projects by the Board of Governors shall be reported to the Joint Legislative Commission on Governmental Operations, and the reports shall include projected costs and sources of funds for operation of the approved projects.

(2a)     Funds that were received pursuant to this section prior to July 1, 2005, and that were transferred to a special fund account on deposit with the State Treasurer are appropriated to the Brody School of Medicine at East Carolina University and may be expended by the Brody School of Medicine for the family medicine center and for purposes consistent with its stated mission."

SECTION 9.26.(b)  Subsections (b) and (c) of Section 87 of Chapter 321 of the 1993 Session Laws are repealed.

SECTION 9.26.(c)  Notwithstanding any other provisions of law, the Board of Governors of The University of North Carolina may authorize the design and construction of a new capital project, a family medicine center, on the Health Sciences Campus of the Brody School of Medicine at East Carolina University, that would replace the existing family medicine facility that has reached capacity. The family medicine center is also used as a clinical teaching site for medical students, and the existing facility is functionally outdated for this purpose. The cost of the facility is estimated to be thirty million dollars ($30,000,000). The Board of Governors of The University of North Carolina may authorize the financing of the project with funds available to the Brody School of Medicine at East Carolina University from Medicare reimbursements for education costs, gifts, grants, receipts, self-liquidating indebtedness, or other funds, or any combination of these funds, but not including funds appropriated from the General Fund of the State.

SECTION 9.26.(d)  Effective July 1, 2005, the Brody School of Medicine Medical Faculty Practice Plan shall no longer be required to reimburse the General Fund for use of outpatient facilities built with General Fund monies.

SECTION 9.26.(e)  Notwithstanding the Senate Appropriations/Base Budget Committee Report dated May 3, 2005, the item #72 ECU Brody School of Medicine/Medicare Receipts on page F-12 of the Report for the UNC System Budget is increased by $700,000 and a new item #78 is added to read as follows:

78        Strategic Initiative Reserves                                           ($700,000)

            Reduces this reserve fund from $4,000,000 to $3,300,000.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

Scholarship Student

SECTION 9.27.(a)  Article 14 of Chapter 116 of the General Statutes is amended by adding a new section to read:

" 116-143.6.  Full scholarship students attending constituent institutions.

(a)       Notwithstanding any other provision of law, any person who receives a full scholarship to a constituent institution and who attends the institution as an undergraduate student shall be considered and treated for all purposes of The University of North Carolina as a resident of North Carolina.

(b)       The following definitions apply in this section:

(1)       'Full scholarship' means a grant that meets the full cost for a student to attend the constituent institution for an academic year.

(2)       'Full cost' means an amount calculated by the constituent institution that is no less than the sum of in-State tuition, required fees, on-campus room and board, and required course-related books.

(c)       This section shall not be applied in any manner that violates federal law.

(d)       No State funds shall be expended to offset any fiscal impact of this section."

SECTION 9.27.(b)  This section applies to students who accept admission on or after July 1, 2005, to a constituent institution.

 

Requested by:            Senators Lucas, Swindell, Garrou, Dalton, Hagan

ENHANCE NUTRITION IN UNIVERSITY AND COMMUNITY COLLEGE FOOD PROGRAMS

SECTION 9.28. For nutritional purposes, the Board of Governors of The University of North Carolina and the State Board of Community Colleges shall adopt policies governing any food programs operated by the constituent institutions or local community colleges that prohibit: (i) the use of cooking oils in those food programs that contain trans-fatty acids, or (ii) the sale of processed foods containing trans-fatty acids that were formed during the commercial processing of the foods.

 

Requested by:            Senators Lucas, Swindell, Snow, Garrou, Dalton, Hagan

Grant-in-Aid/Fire Truck for Cullowhee Volunteer Fire Dept. to help ensure adequate fire protection services to western carolina university

SECTION 9.29.  Of the funds appropriated from the General Fund to the Board of Governors of The University of North Carolina, the sum of seven hundred fifteen thousand dollars ($715,000) for the 2005-2006 fiscal year shall be allocated to Western Carolina University as a grant-in-aid for the Cullowhee Volunteer Fire Department, Inc., to use to purchase a 95-foot platform truck and equipment to ensure adequate fire protection services to Western Carolina University.

 

Requested by:            Senators Shaw, Lucas, Swindell, Garrou, Dalton, Hagan

waive tuition for a person of a certain age who is or was a ward of the state and who attends classes at any constituent institution of the university of north carolina or any community college

SECTION 9.30.(a)  G.S. 115B-2 is amended by adding a new subdivision to read:

"(5)      Any child, if the child (i) is at least 17 years old but not yet 23 years old, (ii) is a ward of North Carolina or was a ward of the State at the time the child reached the age of 18, and (iii) is a resident of the State;"

SECTION 9.30.(b)  G.S. 115B-5 is amended by adding a new subsection to read:

"(c)      The officials of the institutions charged with administration of this Chapter may require proof to verify that a person applying to the institution under G.S. 115B-2(5) is eligible for the benefits provided by this Chapter."

 

PART X. DEPARTMENT OF HEALTH AND HUMAN SERVICES

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

Information Technology

SECTION 10.1.(a)  To support its information technology initiatives, the Department of Health and Human Services shall develop the following:

(1)       A detailed business plan.

(2)       An information technology plan directly tied to business requirements.

(3)       An IT architecture.

The Department of Health and Human Services shall ensure that the planning documents extend three to five years and include detailed shortfall analyses and associated cost assessments. The Department of Health and Human Services shall forward the documents to the Office of Information Technology Services, the Senate Appropriations Committee on Health and Human Services, the House of Representatives Appropriations Subcommittee on Health and Human Services, and the Fiscal Research Division by December 1, 2005. The Office of Information Technology Services shall review the documents and report its findings and recommendations to the Senate Appropriations Committee on Health and Human Services, the House of Representatives Appropriations Subcommittee on Health and Human Services, and the Fiscal Research Division by January 31, 2006.

SECTION 10.1.(b)  The Department of Health and Human Services shall develop a project plan for each of its information technology projects.  These plans shall include the following:

(1)       A detailed description of the project.

(2)       A description of how the project improves Department operations and service to customers.

(3)       The projected cost of the project by year and phase.

(4)       Deliverables required to implement each phase of the system.

(5)       The date that each deliverable is to be implemented.

(6)       The cost of implementing each deliverable.

(7)       What capabilities each deliverable adds to the project.

SECTION 10.1.(c)  The Department of Health and Human Services shall provide the plans to the Senate Appropriations Committee on Health and Human Services, the House of Representatives Appropriations Subcommittee on Health and Human Services, and the Fiscal Research Division no later than October 1, 2005, with subsequent updates provided quarterly. The Department of Health and Human Services shall notify the Division of Fiscal Research within 10 days when costs, completion dates, or system capabilities change and provide a report detailing the impact of the change.

SECTION 10.1.(d)  The Department of Health and Human Services shall not spend more than the amounts appropriated by the General Assembly for information technology projects and may not allocate funds appropriated for one information technology project to any other information technology project.

SECTION 10.1.(e)  The Department of Health and Human Services shall use funds appropriated for the 2005-2006 and 2006-2007 fiscal years for the North Carolina Families Accessing Services through Technology (NC FAST) program only for program-specific development, deliverables, and maintenance costs associated with the NC FAST program.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

Office of Policy and Planning

SECTION 10.2.  Article 3 of Chapter 143B is amended by adding the following new Part to read:

"Part 34. Office of Policy and Planning.

" 143B-216.70.  Office of Policy and Planning.

(a)       To promote coordinated policy development and strategic planning for the State's health and human services systems, the Secretary of Health and Human Services shall establish an Office of Policy and Planning from existing resources across the Department. The Director of the Office of Policy and Planning shall report directly to the Secretary and shall have the following responsibilities:

(1)       Coordinate the development of departmental policies, plans, and rules, in consultation with the Divisions of the Department.

(2)       Development of a departmental process for the development and implementation of new policies, plans, and rules.

(3)       Development of a departmental process for the review of existing policies, plans, and rules to ensure that departmental policies, plans, and rules are relevant.

(4)       Coordination and review of all departmental policies before dissemination to ensure that all policies are well-coordinated within and across all programs.

(5)       Implementation of ongoing strategic planning that integrates budget, personnel, and resources with the mission and operational goals of the Department.

(6)       Review, disseminate, monitor, and evaluate best practice models.

(b)       Under the direction of the Secretary of Health and Human Services, the Director of the Office of Policy and Planning shall have the authority to direct Divisions, offices, and programs within the Department to conduct periodic reviews of policies, plans, and rules and shall advise the Secretary when it is determined to be appropriate or necessary to modify, amend, and repeal departmental policies, plans, and rules. All policy and management positions within the Office of Policy and Planning are exempt positions as that term is defined in G.S. 126-5."

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

Senior Prescription Drug Access Program Funding

SECTION 10.3.  The Director of the Budget shall use available funds up to seven million dollars ($7,000,000) in the 2005-2006 fiscal year to fully fund the Senior Prescription Drug Access Program through December 31, 2005, if there is a shortfall of funds from the Health and Wellness Trust Fund, and the funds are not sufficient to provide drug acquisition services under the Program through December 31, 2005.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

SENIOR CARES PROGRAM ADMINISTRATION

SECTION 10.4.(a)  The Department of Health and Human Services may administer the "Senior Cares" prescription drug access program approved by the Health and Wellness Trust Fund Commission and funded from the Health and Wellness Trust Fund. The Department may use funds appropriated in this act to administer the Senior Cares prescription drug access program.

SECTION 10.4.(b)  This section expires December 31, 2005.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

NONMEDICAID REIMBURSEMENT CHANGES

SECTION 10.5.  Providers of medical services under the various State programs, other than Medicaid, offering medical care to citizens of the State shall be reimbursed at rates no more than those under the North Carolina Medical Assistance Program.

The Department of Health and Human Services may reimburse hospitals at the full prospective per diem rates without regard to the Medical Assistance Program's annual limits on hospital days. When the Medical Assistance Program's per diem rates for inpatient services and its interim rates for outpatient services are used to reimburse providers in non-Medicaid medical service programs, retroactive adjustments to claims already paid shall not be required.

Notwithstanding the provisions of paragraph one, the Department of Health and Human Services may negotiate with providers of medical services under the various Department of Health and Human Services programs, other than Medicaid, for rates as close as possible to Medicaid rates for the following purposes:  contracts or agreements for medical services and purchases of medical equipment and other medical supplies. These negotiated rates are allowable only to meet the medical needs of its non-Medicaid eligible patients, residents, and clients who require such services which cannot be provided when limited to the Medicaid rate.

Maximum net family annual income eligibility standards for services in these programs shall be as follows:

                                           Medical Eye                      Rehabilitation Except

Family Size                        Care Adults                         DSB Over 55 Grant                      Other

        1                                     $4,860                                    $8,364                                 $4,200

        2                                        5,940                                    10,944                                   5,300

        3                                        6,204                                    13,500                                   6,400

        4                                        7,284                                    16,092                                   7,500

        5                                        7,821                                    18,648                                   7,900

        6                                        8,220                                    21,228                                   8,300

        7                                        8,772                                    21,708                                   8,800

        8                                        9,312                                    22,220                                   9,300

The eligibility level for children in the Medical Eye Care Program in the Division of Services for the Blind shall be one hundred percent (100%) of the federal poverty guidelines, as revised annually by the United States Department of Health and Human Services and in effect on July 1 of each fiscal year. The eligibility level for adults 55 years of age or older who qualify for services through the Division of Services for the Blind, Independent Living Rehabilitation Program, shall be two hundred percent (200%) of the federal poverty guidelines, as revised annually by the United States Department of Health and Human Services and in effect on July 1 of each fiscal year. The eligibility level for adults in the Atypical Antipsychotic Medication Program in the Division of Mental Health, Developmental Disabilities, and Substance Abuse Services shall be one hundred fifty percent (150%) of the federal poverty guidelines, as revised annually by the United States Department of Health and Human Services and in effect on July 1 of each fiscal year. Additionally, those adults enrolled in the Atypical Antipsychotic Medication Program who become gainfully employed may continue to be eligible to receive State support, in decreasing amounts, for the purchase of atypical antipsychotic medication and related services up to three hundred percent (300%) of the poverty level.

State financial participation in the Atypical Antipsychotic Medication Program for those enrollees who become gainfully employed is as follows:

                  Income              State Participation                Client Participation

            (% of poverty)

                 0-150%                        100%                                            0%

             151-200%                          75%                                          25%

             201-250%                          50%                                          50%

             251-300%                          25%                                          75%

             300% and over                     0%                                       100%

The Department of Health and Human Services shall contract at, or as close as possible to, Medicaid rates for medical services provided to residents of State facilities of the Department.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

PHYSICIAN SERVICES

SECTION 10.6.  With the approval of the Office of State Budget and Management, the Department of Health and Human Services may use funds appropriated in this act for across-the-board salary increases and performance pay to offset similar increases in the costs of contracting with private and independent universities for the provision of physician services to clients in facilities operated by the Division of Mental Health, Developmental Disabilities, and Substance Abuse Services.  This offsetting shall be done in the same manner as is currently done with the constituent institutions of The University of North Carolina.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

LIABILITY INSURANCE

SECTION 10.7.(a)  The Secretary of the Department of Health and Human Services, the Secretary of the Department of Environment and Natural Resources, and the Secretary of the Department of Correction may provide medical liability coverage not to exceed one million dollars ($1,000,000) per incident on behalf of employees of the Departments licensed to practice medicine or dentistry, on behalf of all licensed physicians who are faculty members of The University of North Carolina who work on contract for the Division of Mental Health, Developmental Disabilities, and Substance Abuse Services for incidents that occur in Division programs, and on behalf of physicians in all residency training programs from The University of North Carolina who are in training at institutions operated by the Department of Health and Human Services.  This coverage may include commercial insurance or self-insurance and shall cover these individuals for their acts or omissions only while they are engaged in providing medical and dental services pursuant to their State employment or training.

SECTION 10.7.(b)  The coverage provided under this section shall not cover any individual for any act or omission that the individual knows or reasonably should know constitutes a violation of the applicable criminal laws of any state or the United States or that arises out of any sexual, fraudulent, criminal, or malicious act or out of any act amounting to willful or wanton negligence.

SECTION 10.7.(c)  The coverage provided pursuant to this section shall not require any additional appropriations and shall not apply to any individual providing contractual service to the Department of Health and Human Services, the Department of Environment and Natural Resources, or the Department of Correction, with the exception that coverage may include physicians in all residency training programs from The University of North Carolina who are in training at institutions operated by the Department of Health and  Human  Services  and  licensed physicians who are faculty members of The University of North Carolina who work for the Division of Mental Health, Developmental Disabilities, and Substance Abuse Services.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

DHHS Payroll Deduction for Child Care Services

SECTION 10.8.  Part 1 of Article 3 of Chapter 143B of the General Statutes is amended by adding the following new section to read:

" 143B-139.6B.  Department of Health and Human Services; authority to deduct payroll for child care services.

Notwithstanding G.S. 143-3.3 and pursuant to rules adopted by the State Controller, an employee of the Department of Health and Human Services may, in writing, authorize the Department to periodically deduct from the employee's salary or wages paid for employment by the State, a designated lump sum to be paid to satisfy the cost of services received for child care provided by the Department."

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

community health centers funds

SECTION 10.9.(a)  Of the funds appropriated in this act for Community Health Grants, the sum of two million dollars ($2,000,000) in recurring funds for the 2005-2006 fiscal year, and the sum of two million dollars ($2,000,000) in recurring funds for the 2006-2007 fiscal year shall be used for federally qualified health centers, for those health centers that meet the criteria for federally qualified health centers, and for State-designated rural health centers and public health departments and other clinics to:

(1)       Increase access to preventative and primary care services by uninsured or medically indigent patients in existing or new health center locations;

(2)       Establish community health center services in counties where no such services exist;

(3)       Create new services or augment existing services provided to uninsured or medically indigent patients, including primary care and preventative medical services, dental services, pharmacy, and behavioral health; and

(4)       Increase capacity necessary to serve the uninsured by enhancing or replacing facilities, equipment, or technologies.

Grant funds may not be used to enhance or increase compensation or other benefits of personnel, administrators, directors, consultants, or any other parties. Grant funds may not be used to supplant federal funds traditionally received by federally qualified community health centers and may not be used to finance or satisfy any existing debt.

SECTION 10.9.(b)  The Office shall work with the North Carolina Community Health Center Association (hereafter "NCCHCA") and the North Carolina Public Health Association (hereafter "NCPHA") to establish an advisory committee to develop an objective and equitable process for awarding grant funds. The Office shall also develop auditing and accountability procedures. Not more than one percent (1%) of the funds appropriated in this section may be used to reimburse the Office for administering the grant program in collaboration with the NCCHCA and the NCPHA.

SECTION 10.9.(c)  Recipients of grant funds shall provide to the Office annually a written report detailing the number of additional uninsured and medically indigent patients that are cared for, the types of services that were provided, and any other information requested by the Office as necessary for evaluating the success of the grant program.

SECTION 10.9.(d)  The Office shall work with the NCCHCA and NCPHA to study and present recommendations for continuing funds to support the expansion of community health centers, State-designated rural health centers, and public health departments to serve more of the State's uninsured and indigent population. The Office shall submit the report to the 2006 Regular Session of the 2005 General Assembly upon its convening.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

Provider Reimbursement Rates

SECTION 10.10.  The Department of Health and Human Services shall maintain reimbursement rates paid to service providers at fiscal year 2004-2005 levels during the 2005-2006 fiscal year. Exceptions made by the Department shall be made on a case-by-case basis and must be approved by the Office of the Secretary. Changes in rate structures that result in lower payments to the providers are exempted from this requirement. As used in this section, "service providers" includes subcontractors, such as counties, area agencies on aging, departments of social services, departments of public health, child developmental services agencies, and local management entities.

 

Requested by:            Senators Purcell, Malone, Dalton, Garrou, Hagan

MEDICAID

SECTION 10.11.(a)  Funds appropriated in this act for services provided in accordance with Title XIX of the Social Security Act (Medicaid) are for both the categorically needy and the medically needy. Funds appropriated for these services shall be expended in accordance with the following schedule of services and payment bases. All services and payments are subject to the language at the end of this subsection.

Services and payment bases:

(1)       Hospital inpatient. - Payment for hospital inpatient services will be prescribed in the State Plan as established by the Department of Health and Human Services.

(2)       Hospital outpatient. - Eighty percent (80%) of allowable costs or a prospective reimbursement plan as established by the Department of Health and Human Services.

(3)       Nursing facilities. - Payment for nursing facility services will be prescribed in the State Plan as established by the Department of Health and Human Services. Nursing facilities providing services to Medicaid recipients who also qualify for Medicare must be enrolled in the Medicare program as a condition of participation in the Medicaid program. State facilities are not subject to the requirement to enroll in the Medicare program. Residents of nursing facilities who are eligible for Medicare coverage of nursing facility services must be placed in a Medicare-certified bed. Medicaid shall cover facility services only after the appropriate services have been billed to Medicare. The Division of Medical Assistance shall allow nursing facility providers sufficient time from the effective date of this act to certify additional Medicare beds if necessary. In determining the date that the requirements of this subdivision become effective, the Division of Medical Assistance shall consider the regulations governing certification of Medicare beds and the length of time required for this process to be completed.

(4)       Intermediate care facilities for the mentally retarded. - As prescribed in the State Plan as established by the Department of Health and Human Services.

(5)       Drugs. - Drug costs as allowed by federal regulations plus a professional services fee per month, excluding refills for the same drug or generic equivalent during the same month. Reimbursement shall be available for up to six prescriptions per recipient per month, including refills. The Department may override the six-prescription limit up to two additional prescriptions for a total of not more than eight prescriptions per recipient per month, for recipients that meet the Department's override policy requirements. Payments for drugs are subject to the provisions of subsection (h) of this section and to the provisions at the end of this subsection or in accordance with the State Plan adopted by the Department of Health and Human Services, consistent with federal reimbursement regulations. Payment of the professional services fee shall be made in accordance with the State Plan adopted by the Department of Health and Human Services, consistent with federal reimbursement regulations. The professional services fee shall be five dollars and sixty cents ($5.60) per prescription for generic drugs and four dollars ($4.00) per prescription for brand-name drugs. Adjustments to the professional services fee shall be established by the General Assembly. In addition to the professional services fee, the Department may pay an enhanced fee for pharmacy services.

(6)       Physicians, chiropractors, podiatrists, optometrists, dentists, certified nurse midwife services, nurse practitioners. - Fee schedules as developed by the Department of Health and Human Services. Payments for dental services are subject to the provisions of subsection (g) of this section.

(7)       Community Alternative Program, EPSDT screens. - Payment to be made in accordance with the rate schedule developed by the Department of Health and Human Services.

(8)       Home health and related services, private duty nursing, clinic services, prepaid health plans, durable medical equipment. - Payment to be made according to reimbursement plans developed by the Department of Health and Human Services.

(9)       Medicare Buy-In. - Social Security Administration premium.

(10)     Ambulance services. - Uniform fee schedules as developed by the Department of Health and Human Services. Public ambulance providers will be reimbursed at cost.

(11)     Hearing aids. - Wholesale cost plus a dispensing fee to the provider.

(12)     Rural health clinic services. - Provider-based, reasonable cost; nonprovider-based, single-cost reimbursement rate per clinic visit.

(13)     Family planning. - Negotiated rate for local health departments. For other providers, see specific services, for instance, hospitals, physicians.

(14)     Independent laboratory and X-ray services. - Uniform fee schedules as developed by the Department of Health and Human Services.

(15)     Optical supplies. - Payment for materials is made to a contractor in accordance with 42 C.F.R. 431.54(d). Fees paid to dispensing providers are negotiated fees established by the State agency based on industry charges.

(16)     Ambulatory surgical centers. - Payment as prescribed in the reimbursement plan established by the Department of Health and Human Services.

(17)     Medicare crossover claims. - By not later than October 1, 2005, the Department shall apply Medicaid medical policy to Medicare claims for dually eligible recipients. The Department shall pay an amount up to the actual coinsurance or deductible or both, in accordance with the State Plan, as approved by the Department of Health and Human Services.

(18)     Physical therapy and speech therapy. - Services limited to EPSDT-eligible children. Payments are to be made only to qualified providers at rates negotiated by the Department of Health and Human Services. Physical therapy (including occupational therapy) and speech therapy services are subject to prior approval and utilization review.

(19)     Personal care services. - Payment in accordance with the State Plan approved by the Department of Health and Human Services.

(20)     Case management services. - Reimbursement in accordance with the availability of funds to be transferred within the Department of Health and Human Services.

(21)     Hospice. - Services may be provided in accordance with the State Plan developed by the Department of Health and Human Services.

(22)     Other mental health services. - Unless otherwise covered by this section, coverage is limited to:

a.         Services as defined by the Division of Mental Health, Developmental Disabilities, and Substance Abuse Services and approved by the Centers for Medicare and Medicaid Services (CMS) when provided in agencies meeting the requirements of the rules established by the Commission for Mental Health, Developmental Disabilities, and Substance Abuse Services and reimbursement is made in accordance with a State Plan developed by the Department of Health and Human Services not to exceed the upper limits established in federal regulations, and

b.         For children eligible for EPSDT services provided by:

1.         Licensed or certified psychologists, licensed clinical social workers, certified clinical nurse specialists in psychiatric mental health advanced practice, nurse practitioners certified as clinical nurse specialists in psychiatric mental health advanced practice, licensed psychological associates, licensed professional counselors, licensed marriage and family therapists, certified clinical addictions specialists, and certified clinical supervisors, when Medicaid-eligible children are referred by the Community Care of North Carolina primary care physician, a Medicaid-enrolled psychiatrist, or the area mental health program or local management entity, and

2.         Institutional providers of residential services as defined by the Division of Mental Health, Developmental Disabilities, and Substance Abuse Services and approved by the Centers for Medicare and Medicaid Services (CMS) for children and Psychiatric Residential Treatment Facility services that meet federal and State requirements as defined by the Department.

c.         For Medicaid-eligible adults, services provided by licensed or certified psychologists, licensed clinical social workers, certified clinical nurse specialists in psychiatric mental health advanced practice, and nurse practitioners certified as clinical nurse specialists in psychiatric mental health advanced practice, licensed psychological associates, licensed professional counselors, licensed marriage and family therapists, certified clinical addictions specialists, and certified clinical supervisors, Medicaid-eligible adults may be self-referred.

d.         Payments made for services rendered in accordance with this subdivision shall be to qualified providers in accordance with approved policies and the State Plan. Nothing in sub-subdivision b. or c. of this subdivision shall be interpreted to modify the scope of practice of any service provider, practitioner, or licensee, nor to modify or attenuate any collaboration or supervision requirement related to the professional activities of any service provider, practitioner, or licensee. Nothing in sub-subdivision b. or c. of this subdivision shall be interpreted to require any private health insurer or health plan to make direct third-party reimbursements or payments to any service provider, practitioner, or licensee.

e.         The Department of Health and Human Services shall not enroll licensed psychological associates, licensed professional counselors, licensed marriage and family therapists, certified clinical addiction specialists, and certified clinical supervisors until all of the following conditions have been met:

1.         The fiscal impact of payments to these qualified providers has been projected;

2.         Funding for any projected requirements in excess of budgeted Division of Medical Assistance funding has been identified from within State funds appropriated to the Department of Health and Human Services, Division of Mental Health, Developmental Disabilities, and Substance Abuse Services to support area mental health programs or county programs, or identified from other sources; and

3.         Approval has been obtained from the Office of State Budget and Management to transfer these State or other source funds from the Division of Mental Health, Developmental Disabilities, and Substance Abuse Services to the Division of Medical Assistance. Upon approval and implementation, the Department of Health and Human Services shall, on a quarterly basis, provide a status report to the Office of State Budget and Management and the Fiscal Research Division.

Notwithstanding G.S. 150B-21.1(a), the Department of Health and Human Services may adopt temporary rules in accordance with Chapter 150B of the General Statutes further defining the qualifications of providers and referral procedures in order to implement this subdivision. Coverage policy for services defined by the Division of Mental Health, Developmental Disabilities, and Substance Abuse Services under sub-subdivisions a. and b.2 of this subdivision shall be established by the Division of Medical Assistance.

(23)     Medically necessary prosthetics or orthotics. - Reimbursement in accordance with the State Plan approved by the Department of Health and Human Services, except that in order to be eligible for reimbursement, providers must be Board certified not later than July 1, 2005. Medically necessary prosthetics and orthotics are subject to prior approval and utilization review.

(24)     Health insurance premiums. - Payments to be made in accordance with the State Plan adopted by the Department of Health and Human Services consistent with federal regulations.

(25)     Medical care/other remedial care. - Services not covered elsewhere in this section include related services in schools; health professional services provided outside the clinic setting to meet maternal and infant health goals; and services to meet federal EPSDT mandates. Services addressed by this subdivision are limited to those prescribed in the State Plan as established by the Department of Health and Human Services.

(26)     Pregnancy-related services. - Covered services for pregnant women shall include nutritional counseling, psychosocial counseling, and predelivery and postpartum home visits by maternity care coordinators and public health nurses.

Services and payment bases may be changed with the approval of the Director of the Budget.

Payment is limited to Medicaid-enrolled providers that purchase a performance bond in an amount not to exceed one hundred thousand dollars ($100,000) naming as beneficiary the Department of Health and Human Services, Division of Medical Assistance, or provide to the Department a validly executed letter of credit or other financial instrument issued by a financial institution or agency honoring a demand for payment in an equivalent amount. The Department may waive or limit the requirements of this paragraph for one or more classes of Medicaid-enrolled providers based on the provider's dollar amount of monthly billings to Medicaid or the length of time the provider has been licensed in this State to provide services. In waiving or limiting requirements of this paragraph, the Department shall take into consideration the potential fiscal impact of the waiver or limitation on the State Medicaid Program. The Department may adopt temporary rules in accordance with G.S. 150B-21.1 as necessary to implement this provision.

Reimbursement is available for up to 24 visits per recipient per year to any one or combination of the following: physicians, clinics, hospital outpatient, optometrists, chiropractors, and podiatrists. Prenatal services, all EPSDT children, emergency rooms, and mental health services subject to independent utilization review are exempt from the visit limitations contained in this paragraph. Exceptions may be authorized by the Department of Health and Human Services where the life of the patient would be threatened without such additional care.

SECTION 10.11.(b)  Allocation of Nonfederal Cost of Medicaid. - The State shall pay eighty-five percent (85%); the county shall pay fifteen percent (15%) of the nonfederal costs of all applicable services listed in this section. In addition, the State shall pay eighty-five percent (85%); the county shall pay fifteen percent (15%) of the federal Medicare Part D clawback payments under the Medicare Modernization Act of 2004.

SECTION 10.11.(c)  Co-Payment for Medicaid Services. - The Department of Health and Human Services may establish co-payments up to the maximum permitted by federal law and regulation and required by this subsection in order to achieve reductions in the budget in fiscal years 2005-2006 and 2006-2007.  The co-payment for inpatient hospitalization services is fifty dollars ($50.00).

SECTION 10.11.(d)  Medicaid and Work First Family Assistance, Income Eligibility Standards. - The maximum net family annual income eligibility standards for Medicaid and Work First Family Assistance and the Standard of Need for Work First Family Assistance shall be as follows:

 

                   Categorically Needy                                        Medically Needy

                             WFFA*

      Family                  Standard                             Families and

         Size                     of Need                         Children Income

                                                                                     Level            AA, AB, AD*

          1                           $4,344                                 $2,172                $2,900

          2                             5,664                                   2,832                   3,800

          3                             6,528                                   3,264                   4,400

          4                             7,128                                   3,564                   4,800

          5                             7,776                                   3,888                   5,200

          6                             8,376                                   4,188                   5,600

          7                             8,952                                   4,476                   6,000

          8                             9,256                                   4,680                   6,300

*Work First Family Assistance (WFFA); Aid to the Aged (AA); Aid to the Blind (AB); and Aid to the Disabled (AD).

 

The payment level for Work First Family Assistance shall be fifty percent (50%) of the standard of need.

These standards may be changed with the approval of the Director of the Budget with the advice of the Advisory Budget Commission.

SECTION 10.11.(e)  The Department of Health and Human Services, Division of Medical Assistance, shall provide Medicaid coverage to all elderly, blind, and disabled people who have incomes equal to or less than one hundred percent (100%) of the federal poverty guidelines, as revised each April 1.  This subsection expires December 31, 2005.

SECTION 10.11.(f)  ICF and ICF/MR Work Incentive Allowances. - The Department of Health and Human Services may provide an incentive allowance to Medicaid-eligible recipients of ICF and ICF/MR facilities who are regularly engaged in work activities as part of their developmental plan and for whom retention of additional income contributes to their achievement of independence. The State funds required to match the federal funds that are required by these allowances shall be provided from savings within the Medicaid budget or from other unbudgeted funds available to the Department. The incentive allowances may be as follows:

 

Monthly Net Wages                 Monthly Incentive Allowance

              $1.00 to $100.99                               Up to $50.00

         $101.00 to $200.99                                         $80.00

         $201.00 to $300.99                                       $130.00

         $301.00 and greater                                       $212.00.

SECTION 10.11.(g)  Dental Coverage Limits. - Dental services shall be provided on a restricted basis in accordance with rules adopted by the Department to implement this subsection.

SECTION 10.11.(h)  Dispensing of Generic Drugs. - Notwithstanding G.S. 90-85.27 through G.S. 90-85.31, or any other law to the contrary, under the Medical Assistance Program (Title XIX of the Social Security Act), and except as otherwise provided in this subsection for atypical antipsychotic drugs and drugs listed in the narrow therapeutic index, a prescription order for a drug designated by a trade or brand name shall be considered to be an order for the drug by its established or generic name, except when the prescriber has determined, at the time the drug is prescribed, that the brand-name drug is medically necessary and has written on the prescription order the phrase "medically necessary". An initial prescription order for an atypical antipsychotic drug or a drug listed in the narrow therapeutic drug index that does not contain the phrase "medically necessary" shall be considered an order for the drug by its established or generic name, except that a pharmacy shall not substitute a generic or established name prescription drug for subsequent brand or trade name prescription orders of the same prescription drug without explicit oral or written approval of the prescriber given at the time the order is filled. Generic drugs shall be dispensed at a lower cost to the Medical Assistance Program rather than trade or brand name drugs. As used in this subsection, "brand name" means the proprietary name the manufacturer places upon a drug product or on its container, label, or wrapping at the time of packaging; and "established name" has the same meaning as in section 502(e)(3) of the Federal Food, Drug, and Cosmetic Act as amended, 21 U.S.C. 352(e)(3).

SECTION 10.11.(i)  The Department of Health and Human Services shall not impose prior authorization requirements or other restrictions under the State Medical Assistance Program on medications prescribed for Medicaid recipients for the treatment of: (i) mental illness, including, but not limited to, medications for schizophrenia, bipolar disorder, and major depressive disorder, or (ii) HIV/AIDS.

SECTION 10.11.(j)  Exceptions to Service Limitations, Eligibility Requirements, and Payments. - Service limitations, eligibility requirements, and payments bases in this section may be waived by the Department of Health and Human Services, with the approval of the Director of the Budget, to allow the Department to carry out pilot programs for prepaid health plans, contracting for services, managed care plans, or community-based services programs in accordance with plans approved by the United States Department of Health and Human Services or when the Department determines that such a waiver will result in a reduction in the total Medicaid costs for the recipient. The Department of Health and Human Services may proceed with planning and development work on the Program of All-Inclusive Care for the Elderly.

SECTION 10.11.(k)  Volume Purchase Plans and Single Source Procurement. - The Department of Health and Human Services, Division of Medical Assistance, may, subject to the approval of a change in the State Medicaid Plan, contract for services, medical equipment, supplies, and appliances by implementation of volume purchase plans, single source procurement, or other contracting processes in order to improve cost containment.

SECTION 10.11.(l)  Cost-Containment Programs. - The Department of Health and Human Services, Division of Medical Assistance, may undertake cost-containment programs, including contracting for services, preadmissions to hospitals, and prior approval for certain outpatient surgeries before they may be performed in an inpatient setting.

SECTION 10.11.(m)  For all Medicaid eligibility classifications for which the federal poverty level is used as an income limit for eligibility determination, the income limits will be updated each April 1 immediately following publication of federal poverty guidelines.

SECTION 10.11.(n)  The Department of Health and Human Services shall provide Medicaid to 19-, 20-, and 21-year-olds in accordance with federal rules and regulations.

SECTION 10.11.(o)  The Department of Health and Human Services shall provide coverage to pregnant women and to children according to the following schedule:

(1)       Pregnant women with incomes equal to or less than one hundred eighty-five percent (185%) of the federal poverty guidelines as revised each April 1 shall be covered for Medicaid benefits.

(2)       Infants under the age of one with family incomes equal to or less than one hundred eighty-five percent (185%) of the federal poverty guidelines as revised each April 1 shall be covered for Medicaid benefits.

(3)       Children aged one through five with family incomes equal to or less than one hundred thirty-three percent (133%) of the federal poverty guidelines as revised each April 1 shall be covered for Medicaid benefits.

(4)       Children aged six through 18 with family incomes equal to or less than the federal poverty guidelines as revised each April 1 shall be covered for Medicaid benefits.

(5)       The Department of Health and Human Services shall provide Medicaid coverage for adoptive children with special or rehabilitative needs regardless of the adoptive family's income.

Services to pregnant women eligible under this subsection continue throughout the pregnancy but include only those related to pregnancy and to those other conditions determined by the Department as conditions that may complicate pregnancy. In order to reduce county administrative costs and to expedite the provision of medical services to pregnant women, to infants, and to children described in subdivisions (3) and (4) of this subsection, no resources test shall be applied.

SECTION 10.11.(p)  Medicaid enrollment of categorically needy families with  children shall be continuous for one year without regard to changes in income or assets.

SECTION 10.11.(q)  The Division of Medical Assistance, Department of Health and Human Services, may provide incentives to counties that successfully recover fraudulently spent Medicaid funds by sharing State savings with counties responsible for the recovery of the fraudulently spent funds.

SECTION 10.11.(r)  If first approved by the Office of State Budget and Management, the Division of Medical Assistance, Department of Health and Human Services, may use funds that are identified to support the cost of development and acquisition of equipment and software through contractual means to improve and enhance information systems that provide management information and claims processing. The Department of Health and Human Services shall identify adequate funds to support the implementation and first year's operational costs that exceed the currently allocated funds for the new contract for the fiscal agent for the Medicaid Management Information System.

SECTION 10.11.(s)  The Department of Health and Human Services may adopt temporary or emergency rules according to the procedures established in G.S. 150B-21.1 and G.S. 150B-21.1A when it finds that these rules are necessary to maximize receipt of federal funds within existing State appropriations, to reduce Medicaid expenditures, and to reduce fraud and abuse. Prior to the filing of these temporary or emergency rules with the Rules Review Commission and the Office of Administrative Hearings, the Department shall consult with the Office of State Budget and Management on the possible fiscal impact of the temporary or emergency rule and its effect on State appropriations and local governments.

SECTION 10.11.(t)  The Department shall report to the Fiscal Research Division of the Legislative Services Office and to the House of Representatives Appropriations Subcommittee on Health and Human Services and the Senate Appropriations Committee on Health and Human Services or the Joint Legislative Health Care Oversight Committee on any change it anticipates making in the Medicaid program that impacts the type or level of service, reimbursement methods, or waivers, any of which require a change in the State Plan or other approval by the Centers for Medicare and Medicaid Services (CMS). The reports shall be provided at the same time they are submitted to CMS for approval.

SECTION 10.11.(u)  Upon approval of a demonstration waiver by the Centers for Medicare and Medicaid Services (CMS), the Department of Health and Human Services may provide Medicaid coverage for family planning services to men and women of childbearing age with family incomes equal to or less than one hundred eighty-five percent (185%) of the federal poverty level. Coverage shall be contingent upon federal approval of the waiver.

SECTION 10.11.(v)  The Department of Health and Human Services may apply federal transfer of assets policies, as described in Title XIX, section 1917(c) of the Social Security Act, including the attachment of liens, to real property excluded as  "income producing", tenancy-in-common, or as nonhomesite property made "income producing" under Title XIX, section 1902(r)(2) of the Social Security Act. The transfer of assets policy shall apply only to an institutionalized individual or the individual's spouse as defined in Title XIX, section 1917(c) of the Social Security Act. This subsection becomes effective no earlier than October 1, 2001. Federal transfer of asset policies and attachment of liens to properties excluded as tenancy-in-common or as nonhomesite property made "income producing" in accordance with this subsection shall become effective not earlier than November 1, 2002.

SECTION 10.11.(w)  When implementing the Supplemental Security Income (SSI) method for considering equity value of income producing property, the Department shall, to the maximum extent possible, employ procedures to mitigate the hardship to Medicaid enrollees occurring from application of the Supplemental Security Income (SSI) method.

SECTION 10.11.(x)  Unless required for compliance with federal law, the Department shall not change medical policy affecting the amount, sufficiency, duration, and scope of health care services and who may provide services until the Division of Medical Assistance has prepared a five-year fiscal analysis documenting the increased cost of the proposed change in medical policy and submitted it for Departmental review. If the fiscal impact indicated by the fiscal analysis for any proposed medical policy change exceeds three million dollars ($3,000,000) in total requirements for a given fiscal year, then the Department shall submit the proposed policy change with the fiscal analysis to the Office of State Budget and Management and the Fiscal Research Division. The Department shall not implement any proposed medical policy change exceeding three million dollars ($3,000,000) in total requirements for a given fiscal year unless the source of State funding is identified and approved by the Office of State Budget and Management. The Department shall provide the Office of State Budget and Management and the Fiscal Research Division a quarterly report itemizing all medical policy changes with total requirements of less than three million dollars ($3,000,000).

SECTION 10.11.(y)  The Department shall develop, amend, and adopt medical coverage policy in accordance with the following:

(1)       During the development of new medical coverage policy or amendment to existing medical coverage policy, consult with and seek the advice of the Physician Advisory Group of the North Carolina Medical Society and other organizations the Secretary deems appropriate. The Secretary shall also consult with and seek the advice of officials of the professional societies or associations representing providers who are affected by the new medical coverage policy or amendments to existing medical coverage policy.

(2)       At least 45 days prior to the adoption of new or amended medical coverage policy, the Department shall:

a.         Publish the proposed new or amended medical coverage policy on the Department's Web site;

b.         Notify all Medicaid providers of the proposed, new, or amended policy; and

c.         Upon request, provide persons copies of the proposed medical coverage policy.

(3)       During the 45-day period immediately following publication of the proposed new or amended medical coverage policy, accept oral and written comments on the proposed new or amended policy.

(4)       If, following the comment period, the proposed new or amended medical coverage policy is modified, then the Department shall, at least 15 days prior to its adoption:

a.         Notify all Medicaid providers of the proposed policy;

b.         Upon request, provide persons notice of amendments to the proposed policy; and

c.         Accept additional oral or written comments during this 15-day period.

SECTION 10.11.(z)  For the purposes of investigating and reducing client fraud and abuse, the Department of Health and Human Services, Division of Medical Assistance, shall include in the Medicaid enrollment process the requirement that the applicant for Medicaid consent to or authorize in writing the release of the applicant's medical records for the three years immediately preceding the application for Medicaid benefits.  The Department shall obtain and use information from the applicant's medical records in a manner and form that complies with the Health Insurance Portability and Accountability Act of 1996 ("HIPAA"), P.L. 104-191, as amended, and that protects the privacy of the information as required by other applicable federal or State law. In addition to fraud and abuse detection, the Department may require the applicant's consent for other purposes permitted by HIPAA and required or authorized by other applicable federal or State law.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

DISPOSITION OF DISPROPORTIONATE SHARE RECEIPTS

SECTION 10.12.(a)  Disproportionate share receipts reserved at the end of the 2005-2006 and 2006-2007 fiscal years shall be deposited with the Department of State Treasurer as nontax revenue for each of those fiscal years.

SECTION 10.12.(b)  For each year of the 2005-2007 fiscal biennium, as it receives funds associated with Disproportionate Share Payments from State hospitals, the Department of Health and Human Services, Division of Medical Assistance, shall deposit up to one hundred million dollars ($100,000,000) of these Disproportionate Share Payments to the Department of State Treasurer for deposit as nontax revenue.  Any Disproportionate Share Payments collected in excess of one hundred million dollars ($100,000,000) shall be reserved by the State Treasurer for future appropriations.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

COUNTY MEDICAID COST SHARE

SECTION 10.13.(a)  Effective July 1, 2000, the county share of the cost of Medicaid services currently and previously provided by area mental health authorities shall be increased incrementally each fiscal year until the county share reaches fifteen percent (15%) of the nonfederal share by State fiscal year 2009-2010.

SECTION 10.13.(b)  Effective July 1, 2000, the county share of the cost of Medicaid Personal Care Services paid to adult care homes shall be decreased incrementally each fiscal year until the county share reaches fifteen percent (15%) of the nonfederal share by State fiscal year 2009-2010.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

MEDICAID COST CONTAINMENT ACTIVITIES

SECTION 10.14.  The Department of Health and Human Services may use not more than three million dollars ($3,000,000) in the 2005-2006 fiscal year and not more than three million dollars ($3,000,000) in the 2006-2007 fiscal year in Medicaid funds budgeted for program services to support the cost of administrative activities when cost-effectiveness and savings are demonstrated.  The funds shall be used to support activities that will contain the cost of the Medicaid Program, including contracting for services or hiring additional staff.  Medicaid cost-containment activities may include prospective reimbursement methods, incentive-based reimbursement methods, service limits, prior authorization of services, periodic medical necessity reviews, revised medical necessity criteria, service provision in the least costly settings, plastic magnetic stripped Medicaid identification cards for issuance to Medicaid enrollees, fraud detection software or other fraud detection activities, technology that improves clinical decision making, credit balance recovery and data mining services, and other cost-containment activities.  Funds may be expended under this section only after the Office of State Budget and Management has approved a proposal for the expenditure submitted by the Department. Proposals for expenditure of funds under this section shall include the cost of implementing the cost-containment activity and documentation of the amount of savings expected to be realized from the cost-containment activity.  The Department shall provide a copy of proposals for expenditures under this section to the Fiscal Research Division.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

MEDICAID RESERVE FUND TRANSFER

SECTION 10.15.  Of the funds transferred to the Department of Health and Human Services for Medicaid programs pursuant to G.S. 143-23.2, the sum of fifty million dollars ($50,000,000) for the 2005-2006 fiscal year and the sum of fifty million dollars ($50,000,000) for the 2006-2007 fiscal year shall be allocated as prescribed by G.S. 143-23.2(b) for Medicaid programs. Notwithstanding the prescription in G.S. 143-23.2(b) that these funds not reduce State general revenue funding, these funds shall replace the reduction in general revenue funding effected in this act.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

NO Prior AUTHORIZATION FOR CERTAIN prescription DRUGS UNDER MEDICAID

SECTION 10.16.  The Department of Health and Human Services, Division of Medical Assistance, shall not establish prior authorization requirements or other restrictions under the State Medical Assistance Program for FDA-approved medications indicated for the treatment of life-threatening respiratory conditions due to chronic obstructive pulmonary disease (COPD) or stroke. In developing a disease management program, the Department of Health and Human Services shall include initiatives that positively impact COPD and stroke-related health care costs.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

EXPAND COMMUNITY CARE OF NORTH CAROLINA MANAGEMENT TO ADDITIONAL MEDICAID RECIPIENTS

SECTION 10.17.(a)  The Department of Health and Human Services shall expand the scope of Community Care of NC care management model to recipients of Medicaid and dually eligible individuals with a chronic condition and long-term care needs.  In expanding the scope, the Department shall focus on the Aged, Blind, and Disabled, and CAP-DA populations for improvement in management, cost-effectiveness, and local coordination of services through Community Care of NC and in collaboration with local providers of care.  The Department shall target personal care services, private duty nursing, home health, durable medical equipment, ancillary professional services, specialty care, residential services, including skilled nursing facilities, home infusion therapy, pharmacy, and other services determined target-worthy by the Department.  The Department shall pilot communitywide initiatives and shall expand statewide successful models.

SECTION 10.17.(b)  The Department of Health and Human Services may work with the federal government to attain the necessary regulatory and policy relief to better align policy and economic incentives to improve care in the most cost-effective manner and attain savings through controlled utilization of services.

SECTION 10.17.(c)  The Department of Health and Human Services may pay network and primary care providers an enhanced PMPM care management fee and shall also provide additional block grant funds for start-up during the pilot phase. 

SECTION 10.17.(d)  The Department of Health and Human Services shall report on the implementation of this section, including resulting savings and quality improvement benchmarks to the Senate Appropriations Committee on Health and Human Services, the House of Representatives Appropriations Subcommittee on Health and Human Services, and the Fiscal Research Division not later than March 1, 2007.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

TICKET TO WORK/MEDICAID ELIGIBILITY

SECTION 10.18.(a)  Article 2 of Chapter 108A of the General Statutes is amended by adding the following new section to read:

" 108A-54.1. Medicaid buy-in for workers with disabilities.

(a)       Title. - This act may be cited as the Health Coverage for Workers With Disabilities Act. The Department shall implement a Medicaid buy-in eligibility category as permitted under P.L. 106-170, Ticket to Work and Work Incentives Improvement Act of 1999. The Department shall establish rules, policies, and procedures to implement this act in accordance with this section.

(b)       Definitions. - As used in this section, unless the context clearly requires otherwise:

(1)       'FPG' means the federal poverty guidelines.

(2)       'HCWD' means Health Coverage for Workers With Disabilities.

(3)       'SSI' means Supplemental Security Income.

(4)       'Ticket to Work' means the Ticket to Work and Work Incentives Improvement Act of 1999.

(c)       Eligibility. - An individual is eligible for HCWD if:

(1)       The individual is at least 16 years of age and is less than 65 years of age;

(2)       The individual meets Social Security Disability criteria, or the individual has been enrolled in HCWD and then becomes medically improved as defined in Ticket to Work and as further specified by the Department. An individual shall be determined to be eligible under this section without regard to the individual's ability to engage in, or actual engagement in, substantial gainful activity as defined in section 223 of the Social Security Act (42 U.S.C. 423(d)(4)). In conducting annual redetermination of eligibility, the Department may not determine that an individual participating in HCWD is no longer disabled based solely on the individual's participation in employment or earned income;

(3)       The individual's unearned income does not exceed one hundred fifty percent (150%) of FPG, and countable resources for the individual do not exceed the resource limit for the minimum community spouse resource standard under 42 U.S.C. 1396r, and as further determined by the Department. In determining an individual's countable income and resources, the Department may not consider income or resources that are disregarded under the State Medical Assistance Plan's financial methodology, including the sixty-five-dollar ($65.00) disregard, impairment-related work expenses, student earned-income exclusions, and other SSI program work incentive income disregards; and

(4)       The individual is engaged in a substantial and reasonable work effort (employed) as provided in this subdivision and as further defined by the Department and allowable under federal law. For purposes of this subsection, "engaged in substantial and reasonable work effort" means all of the following:

a.         Working in a competitive, inclusive work setting, or self-employed.

b.         Earning at least the applicable minimum wage.

c.         Having monthly earnings above the SSI basic sixty-five-dollar ($65.00) earned-income disregard.

d.         Being able to provide evidence of paying applicable Medicare, Social Security, and State and federal income taxes.

The Department may impose additional earnings requirements in defining "engaged in substantial and reasonable work effort" for individuals who are eligible for HCWD based on medical improvement.

Individuals who participate in HCWD but thereafter become unemployed for involuntary reasons, including health reasons, shall have continued eligibility in HCWD for up to 12 months from the time of involuntary unemployment, so long as the individual (i) maintains a connection with the workforce, as determined by the Department, (ii) meets all other eligibility criteria for HCWD during the period, and (iii) pays applicable fees, premiums, and co-payments.

(d)       Fees, Premiums, and Co-Payments. - Individuals who participate in HCWD and have countable income greater than one hundred fifty percent (150%) of FPG shall pay an annual enrollment fee of fifty dollars ($50.00) to their county department of social services. Individuals who participate in HCWD and have countable income greater than or equal to two hundred percent (200%) of FPG shall pay a monthly premium in addition to the annual fee. The Department shall set a sliding scale for premiums, which is consistent with applicable federal law. An individual with countable income equal to or greater than four hundred fifty percent (450%) of FPG shall pay not less than one hundred percent (100%) of the cost of the premium, as determined by the Department. The premium shall be based on the experience of all individuals participating in the Medical Assistance Program. Individuals who participate in HCWD are subject to co-payments equal to those required under the North Carolina Health Choice Program."

SECTION 10.18.(b)  Of the funds appropriated in this act to the Department of Health and Human Services, Division of Medical Assistance, the sum of one hundred fifty thousand dollars ($150,000) for the 2006-2007 fiscal year shall be used to support the expansion of Medicaid eligibility authorized under subsection (a) of this section.

SECTION 10.18.(c)  Subsection (b) of this section becomes effective July 1, 2006.  Subsection (a) of this section becomes effective January 1, 2007.  The remainder of this section is effective when it becomes law.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

MEDICAID PERSONAL CARE SERVICES LIMITATIONS

SECTION 10.19.(a)  The Department of Health and Human Services, Division of Medical Assistance, shall apply the following minimum criteria for eligibility for personal care services under Medicaid:

(1)       Personal care services shall not exceed three hours per day and 40 hours per month.

(2)       Before services are authorized, the individual must be assessed by a physician who has examined the individual. The assessing physician must use an assessment tool identified by the Division.

(3)       The physician must see the individual at least every six months after service is approved to determine if the need for services continues to exist.

(4)       The provider of personal care services must ensure that a nurse reviews the individual's services every 90 days or less, as determined by the Division of Medical Assistance.

The Division may include additional criteria for eligibility for personal care services.

SECTION 10.19.(b)  The Division of Medical Assistance shall work with Community Care of North Carolina (CCNC) to determine how CCNC can help with the review of the need for personal care services.

SECTION 10.19.(c)  The Division of Medical Assistance shall study and determine appropriate utilization/prior authorization systems for personal care services and other home and community-based services that can be provided to individuals who meet medical criteria and that can be implemented when the new MMIS goes into effect.  The Department of Health and Human Services, Division of Medical Assistance, shall report the plan for implementation of this section, including costs, not later than May 1, 2006, to the Senate Appropriations Committee on Health and Human Services, the House of Representatives Appropriations Subcommittee on Health and Human Services, and the Fiscal Research Division.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

CAP-DA CHANGES

SECTION 10.20.(a)  The Department of Health and Human Services, Division of Medical Assistance, shall develop a new system for reimbursing the CAP-DA program.  The new system shall:

(1)       Use a case-mix reimbursement system, similar to the one used by nursing facilities, to determine the level of care provided and the amount paid for the care provided; and

(2)       Use the Resource Utilization Groups-III (RUG-III) to determine level of need for CAP-DA services.

SECTION 10.20.(b)  When determining eligibility and service level for CAP-DA services, the Division shall include criteria that consider the ability and availability of family members to provide care.

SECTION 10.20.(c)  Not later than May 1, 2006, the Department of Health and Human Services, Division of Medical Assistance, shall report on the development of the new system, including an implementation schedule.   Full implementation of the new system shall be not later than January 1, 2007.  The Department  shall submit the report to the Senate Appropriations Committee on Health and Human Services, the House of Representatives Appropriations Subcommittee on Health and Human Services, and the Fiscal Research Division.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

dma ACCESS TO HEALTH INSURANCE INFORMATION TO ENSURE RECOUPMENT OF medicaid funds  SPENT ON MEDICAL CARE covered by insurance

SECTION 10.21.(a)  Part 1 of Article 50 of Chapter 58 of the General Statutes is amended by adding the following new section to read:

" 58-50-46.  Insurers to provide certain information to Department of Health and Human Services.

(a)       As used in this section, the terms:

(1)       'Department' means the Department of Health and Human Services.

(2)       'Division' means the Division of Medical Assistance of the Department of Health and Human Services.

(3)       'Health benefit plan' and 'insurer' have the meaning applicable under G.S. 58-3-167.

(4)       'Medical assistance' means medical assistance benefits provided under the State Medical Assistance Plan.

(b)       Every insurer issuing a health benefit plan shall provide to the Department of Health and Human Services, upon its request, information, including automated data matches conducted under the direction of the Department of Health and Human Services, Division of Medical Assistance, as necessary for the purpose of identifying individuals covered under the insurer's health benefit plans who are also recipients of medical assistance. To facilitate the Division in obtaining this and other related information, every insurer shall:

(1)       Cooperate with the Division to determine whether a named individual who is a recipient of medical assistance may be covered under the insurer's health benefit plan and eligible to receive benefits under the health benefit plan for services provided under the State Medical Assistance Plan;

(2)       Accept the Division's authorization for the provision of medical services on behalf of the recipient of medical assistance as the insurer's authorization for the provision of the services; and

(3)       Respond to the request for information within 15 working days after receipt of written proof of loss or claim for payment for health care services provided to a recipient of medical assistance who is covered by the insurer's health benefit plan.

(c)       An insurer that complies with this section shall not be liable on that account in any civil or criminal action or proceedings brought by an individual covered under the insurer's health benefit plan, or the individual's beneficiaries."

SECTION 10.21.(b)  G.S. 108A-70 reads as rewritten:

" 108A-70.  Recoupment of amounts spent on medical care.

(a)       The Department may garnish the wages, salary, or other employment income of, and the Secretary of Revenue shall withhold amounts from State tax refunds to, any person who:

(1)       Is required by court or administrative order to provide health benefit plan coverage for the cost of health care services to a child eligible for medical assistance under Medicaid; and

(2)       Has received payment from a third party for the costs of such services; but

(3)       Has not used such payments to reimburse, as appropriate, either the other parent or guardian of the child or the provider of the services;

to the extent necessary to reimburse the Department for expenditures for such costs under this Part; provided, however, claims for current and past due child support shall take priority over any such claims for the costs of such services.

(b)       To the extent that payment for covered services has been made under G.S. 108A-55 for health care items or services furnished to an individual, in any case where a third party has a legal liability to make payments, the Department of Health and Human Services is considered to have acquired the rights of the individual to payment by any other party for those health care items or services.

(c)       The Department of Health and Human Services, Division of Medical Assistance, may request, receive, and use information obtained pursuant to G.S. 58-50-46 in order to enforce this section."

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

NC HEALTH CHOICE APPROPRIATIONS; CLAIMS PROCESSING

SECTION 10.22.(a)  Of the funds appropriated in this act to the Department of Health and Human Services for the NC Health Choice Program, the sum of fourteen million six hundred seventy thousand six hundred sixty-nine dollars ($14,670,669) for the 2005-2006 fiscal year, and the sum of thirty-five million four hundred seventy-five thousand three hundred ninety-nine dollars ($35,475,399) for the 2006-2007 fiscal year, shall be used to continue enrolling children in the NC Health Choice Program.  The total amount of funds appropriated for the NC Health Choice Program for the 2005-2007 fiscal biennium may be increased through budget transfers, subject to the approval of the Office of State Budget and Management, if needed to match available federal funds to support Program expenditures.

SECTION 10.22.(b)  It is the intent of the General Assembly to address the shortfall in federal funding for the NC Health Choice Program in the second year of the 2005 fiscal biennium by directing the Department of Health and Human Services to develop strategies and recommendations for maximizing available federal funds for the Medicaid Program and the NC Health Choice Program and for maximizing administrative efficiencies in the NC Health Choice Program. The purpose of the strategies and recommendations is to produce savings in State and federal funds so as to ensure the ability of the State to continue enrolling children in the NC Health Choice Program and to avoid the necessity of freezing enrollment due to the potential shortage of federal funds.   To this end, the Department of Health and Human Services shall develop a Plan for changes to the administration and claims processing of the NC Health Choice Program.  The Plan may include issuance of a Request for Proposal, changes incorporated into existing contracts, or by other means that will result in greater savings in administrative costs.  The Plan shall provide for full implementation of changes to administration and claims processing not later than July 1, 2007.  In developing the Plan, the Department shall consider the fiscal impact of paying NC Health Choice Program claims at Medicaid rates and the impact a change in rates would have on access to services.  The Department shall report on the development of the Plan and recommendations for actions by the General Assembly, not later than January 1, 2006. The Department shall submit the report to the Senate Appropriations Committee on Health and Human Services, the House of Representatives Appropriations Subcommittee on Health and Human Services, and the Fiscal Research Division.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

LONG-TERM PLAN FOR MEETING MENTAL HEALTH, DEVELOPMENTAL DISABILITIES, AND SUBSTANCE ABUSE SERVICES NEEDS

SECTION 10.24.(a)  The Secretary of the Department of Health and Human Services shall, in consultation with interested advocacy groups and affected State and local agencies, develop a long-range plan for addressing the mental health, developmental disabilities, and substance abuse services needs of the State. The plan shall be consistent with the plan developed pursuant to G.S. 122C-102, and shall address the following:

(1)       The services needed at the community level within each LME in order to ensure an adequate level of services to the average number of persons needing the services based on population projections.

(2)       The full continuum of services needed for each disability group within an LME, including:

a.         Which services could be regional or multi-LME based;

b.         What percent of the population each LME would expect to use State-level facilities; and

c.         An inventory of existing services within each LME for each disability group, and the gaps that exist;

(3)       Projected growth in services for each disability group within each LME or region that can reasonably be managed over the ensuing five-year period; and

(4)       Projected start-up costs and the total funding needed in each year from the Trust Fund for Mental Health, Developmental Disabilities, and Substance Abuse Services and Bridge Funding Needs to implement the long-range plan.

Funds shall not be transferred from the Trust Fund for Mental Health, Developmental Disabilities, and Substance Abuse Services and Bridge Funding Needs until the Secretary has consulted with the Joint Legislative Commission on Governmental Operations, the Joint Legislative Oversight Committee on Mental Health, Developmental Disabilities, and Substance Abuse Services, and the Chairs of the Senate Appropriations Committee on Health and Human Services and the House of Representatives Appropriations Subcommittee on Health and Human Services.

SECTION 10.24.(b)  Moneys in the Trust Fund established pursuant to G.S. 143-15D shall be used to establish or expand community-based services only if sufficient recurring funds can be identified within the Department from funds currently budgeted for mental health, developmental disabilities, and substance abuse services, area mental health programs or county programs, or local government.

SECTION 10.24.(c)  Not later than January 1, 2006, the Department of Health and Human Services shall report on the implementation of this section to the Senate Appropriations Committee on Health and Human Services, the House of Representatives Appropriations Subcommittee on Health and Human Services, and the Fiscal Research Division.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

COMPREHENSIVE TREATMENT SERVICES PROGRAM

SECTION 10.25.(a)  The Department of Health and Human Services shall continue the Comprehensive Treatment Services Program for children at risk for institutionalization or other out-of-home placement.  The Program shall be implemented by the Department in consultation with the Department of Juvenile Justice and Delinquency Prevention, the Department of Public Instruction, and other affected State agencies.  The purpose of the Program is to provide appropriate and medically necessary residential and nonresidential treatment alternatives for children at risk of institutionalization or other out-of-home placement.  Program funds shall be targeted for non-Medicaid eligible children.  Program funds may also be used to expand a system-of-care approach for services to children and their families statewide.  The program shall include the following:

(1)       Behavioral health screening for all children at risk of institutionalization or other out-of-home placement.

(2)       Appropriate and medically necessary residential and nonresidential services for deaf children.

(3)       Appropriate and medically necessary residential and nonresidential treatment services including placements for sexually aggressive youth.

(4)       Appropriate and medically necessary residential and nonresidential treatment services including placements for youths needing substance abuse treatment services and children with serious emotional disturbances.

(5)       Multidisciplinary case management services, as needed.

(6)       A system of utilization review specific to the nature and design of the Program.

(7)       Mechanisms to ensure that children are not placed in department of social services custody for the purpose of obtaining mental health residential treatment services.

(8)       Mechanisms to maximize current State and local funds and to expand use of Medicaid funds to accomplish the intent of this Program.

(9)       Other appropriate components to accomplish the Program's purpose.

(10)     The Secretary of the Department of Health and Human Services may enter into contracts with residential service providers.

(11)     A system of identifying and tracking children placed outside of the family unit in group homes, therapeutic foster care home settings, and other out-of-home placements.

SECTION 10.25.(b)  In order to ensure that children at risk for institutionalization or other out-of-home placement are appropriately served by the mental health, developmental disabilities, and substance abuse services system, the Department of Health and Human Services, Division of Mental Health, Developmental Disabilities, and Substance Abuse Services, shall do the following with respect to services provided to these children:

(1)       Provide only those treatment services that are medically necessary.

(2)       Implement utilization review of services provided.

(3)       Adopt the following guiding principles for the provision of services:

a.         Service delivery system must be outcome-oriented and evaluation-based.

b.         Services should be delivered as close as possible to the child's home.

c.         Services selected should be those that are most efficient in terms of cost and effectiveness.

d.         Services should not be provided solely for the convenience of the provider or the client.

e.         Families and consumers should be involved in decision making throughout treatment planning and delivery.

(4)       Implement all of the following cost-reduction strategies:

a.         Preauthorization for all services except emergency services.

b.         Levels of care to assist in the development of treatment plans.

c.         Clinically appropriate services.

SECTION 10.25.(c)  The Department shall collaborate with other affected State agencies such as the Department of Juvenile Justice and Delinquency Prevention, the Department of Public Instruction, the Administrative Office of the Courts, and with local departments of social services, area mental health programs, and local education agencies to eliminate cost shifting and facilitate cost-sharing among these governmental agencies with respect to the treatment and placement services.

SECTION 10.25.(d)  The Department shall not allocate funds appropriated for Program services until a Memorandum of Agreement has been executed between the Department of Health and Human Services, the Department of Public Instruction, and other affected State agencies.  The Memorandum of Agreement shall address specifically the roles and responsibilities of the various departmental divisions and affected State agencies involved in the administration, financing, care, and placement of children at risk of institutionalization or other out-of-home placement.  The Department shall not allocate funds appropriated in this act for the Program until Memoranda of Agreement between local departments of social services, area mental health programs, local education agencies, and the Administrative Office of the Courts and the Department of Juvenile Justice and Delinquency Prevention, as appropriate, are executed to effectuate the purpose of the Program.  The Memoranda of Agreement shall address issues pertinent to local implementation of the Program, including provision for the immediate availability of student records to a local school administrative unit receiving a child placed in a residential setting outside the child's home county.

SECTION 10.25.(e)  Notwithstanding any other provision of law to the contrary, services under the Comprehensive Treatment Services Program are not an entitlement for non-Medicaid eligible children served by the Program.

SECTION 10.25.(f)  Of the funds appropriated in this act for the Comprehensive Treatment Services Program, the Department of Health and Human Services shall establish a reserve of three percent (3%) to ensure availability of these funds to address specialized needs for children with unique or highly complex problems.

SECTION 10.25.(g)  The Department of Health and Human Services, in conjunction with the Department of Juvenile Justice and Delinquency Prevention, the Department of Public Instruction, and other affected agencies, shall report on the following Program information:

(1)       The number and other demographic information of children served.

(2)       The amount and source of funds expended to implement the Program.

(3)       Information regarding the number of children screened, specific placement of children including the placement of children in programs or facilities outside of the child's home county, and treatment needs of children served.

(4)       The average length of stay in residential treatment, transition, and return to home.

(5)       The number of children diverted from institutions or other out-of-home placements such as training schools and State psychiatric hospitals and a description of the services provided.

(6)       Recommendations on other areas of the Program that need to be improved.

(7)       Other information relevant to successful implementation of the Program.

SECTION 10.25.(h)  The Department shall submit a report on December 1, 2005, on the implementation of this section and a final report not later than April 1, 2006, to the House of Representatives Appropriations Subcommittee on Health and Human Services, the Senate Appropriations Committee on Health and Human Services, the Joint Legislative Oversight Committee on Mental Health, Developmental Disabilities, and Substance Abuse Services, and the Fiscal Research Division.

SECTION 10.25.(i)  This section expires July 1, 2006.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

SERVICES TO MULTIPLY DIAGNOSED ADULTS

SECTION 10.26.(a)  In order to ensure that multiply diagnosed adults are appropriately served by the mental health, developmental disabilities, and substance abuse services system, the Department of Health and Human Services, Division of Mental Health, Developmental Disabilities, and Substance Abuse Services, shall do the following with respect to services provided to these adults:

(1)       Implement the following guiding principles for the provision of services:

a.         Service delivery system must be outcome-oriented and evaluation-based.

b.         Services should be delivered as close as possible to the consumer's home.

c.         Services selected should be those that are most efficient in terms of cost and effectiveness.

d.         Services should not be provided solely for the convenience of the provider or the client.

e.         Families and consumers should be involved in decision making throughout treatment planning and delivery.

(2)       Provide those treatment services that are medically necessary.

(3)       Implement utilization review of services provided.

SECTION 10.26.(b)  The Department of Health and Human Services shall implement all of the following cost-reduction strategies:

(1)       Preauthorization for all services except emergency services.

(2)       Criteria for determining medical necessity.

(3)       Clinically appropriate services.

SECTION 10.26.(c)  No State funds shall be used for the purchase of single-family or other residential dwellings to house multiply diagnosed adults.

SECTION 10.26.(d)  The Department shall submit a progress report on implementation of this section not later than February 1, 2006, and a final report not later than May 1, 2006, to the Senate Appropriations Committee on Health and Human Services, the House of Representatives Appropriations Subcommittee on Health and Human Services, the Joint Legislative Oversight Committee on Mental Health, Developmental Disabilities, and Substance Abuse Services, and the Fiscal Research Division.

SECTION 10.26.(e)  This section expires July 1, 2006.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

EXTEND MENTAL HEALTH CONSUMER ADVOCACY PROGRAM CONTINGENT UPON FUNDS APPROPRIATED BY THE 2007 GENERAL ASSEMBLY

SECTION 10.27.  Section 4 of S.L. 2001-437, as amended by Section 10.30 of S.L. 2002-126, and as further amended by Section 10.10 of S.L. 2003-284, reads as rewritten:

"SECTION 4. Sections 1.1 through 1.21(b) of this act become effective July 1, 2002. Section 2 of this act becomes effective only if funds are appropriated by the 2005 General Assembly for that purpose. Section 2 of this act becomes effective July 1 of the fiscal year for which funds are appropriated by the 2005 General Assembly for that purpose. The remainder of this act is effective when it becomes law."

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

TRANSITION PLANNING FOR STATE PSYCHIATRIC HOSPITALS

SECTION 10.28.(a)  In keeping with the United States Supreme Court decision in Olmstead vs. L.C. & E.W. and State policy to provide appropriate services to clients in the least restrictive and most appropriate environment, the Department of Health and Human Services shall continue to implement a plan for the transition of patients from State psychiatric hospitals to the community or to other long-term care facilities, as appropriate. The goal is to develop mechanisms and identify resources needed to enable patients and their families to receive the necessary services and supports based on the following guiding principles:

(1)       Individuals shall be provided acute psychiatric care in non-State facilities when appropriate.

(2)       Individuals shall be provided acute psychiatric care in State facilities only when non-State facilities are unavailable.

(3)       Individuals shall receive evidenced-based psychiatric services and care that are cost-efficient.

(4)       The State shall minimize cost shifting to other State and local facilities or institutions.

SECTION 10.28.(b)  The Department of Health and Human Services shall conduct an analysis of the individual patient service needs and shall develop and implement an individual transition plan, as appropriate, for patients in each hospital.  The State shall ensure that each individual transition plan, as appropriate, shall take into consideration the availability of appropriate alternative placements based on the needs of the patient and within resources available for the mental health, developmental disabilities, and substance abuse services system. In developing each plan, the Department shall consult with the patient and the patient's family or other legal representative.

SECTION 10.28.(c)  In accordance with the plan established in subsections (a) and (b) of this section, any nonrecurring savings in State appropriations that result from reductions in beds or services shall be placed in the Trust Fund for Mental Health, Developmental Disabilities, and Substance Abuse Services and Bridge Funding Needs.  These funds shall be used to facilitate the transition of clients into appropriate community-based services and supports in accordance with G.S. 143-15.3D. Recurring savings realized through implementation of this section shall be retained by the Department of Health and Human Services, Division of Mental Health, Developmental Disabilities, and Substance Abuse Services, (i) for implementation of subsections (a) and (b) of this section and (ii) to support the recurring costs of additional community-based placements from Division facilities in accordance with Olmstead vs. L.C. & E.W.

SECTION 10.28.(d)  The Department of Health and Human Services shall submit reports on the status of implementation of this section to the Joint Legislative Commission on Governmental Operations, the Senate Appropriations Committee on Health and Human Services, the House of Representatives Appropriations Subcommittee on Health and Human Services, the Joint Legislative Oversight Committee on Mental Health, Developmental Disabilities, and Substance Abuse Services, and the Fiscal Research Division.  These reports shall be submitted on December 1, 2005, and May 1, 2006.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

MENTAL RETARDATION CENTER DOWNSIZING

SECTION 10.29.(a)  In accordance with the Department of Health and Human Services' plan for downsizing the State's regional mental retardation facilities by four percent (4%) each year, the Department shall implement cost-containment and reduction strategies to ensure the corresponding financial and staff downsizing of each facility. The Department shall manage the client population of the mental retardation centers in order to ensure that placements for ICF/MR level of care shall be made in non-State facilities. Admissions to State ICF/MR facilities are permitted only as a last resort and only upon approval of the Department. The corresponding budgets for each of the State mental retardation centers shall be reduced, and positions shall be eliminated as the census of each facility decreases. At no time shall mental retardation center positions be transferred to other units within a facility or assigned nondirect care activities such as outreach.

SECTION 10.29.(b)  The Department of Health and Human Services shall apply any savings in State appropriations in each year of the 2005-2007 fiscal biennium that result from reductions in beds or services as follows:

(1)       The Department shall place nonrecurring savings in the Trust Fund for Mental Health, Developmental Disabilities, and Substance Abuse Services and Bridge Funding Needs and use the savings to facilitate the transition of clients into appropriate community-based services and support in accordance with G.S. 143-15.3D;

(2)       The Department of Health and Human Services, Division of Mental Health, Developmental Disabilities, and Substance Abuse Services, shall retain recurring savings realized through implementation of this section to support the recurring costs of additional community-based placements from Division facilities in accordance with Olmstead vs. L.C. & E.W. In determining the savings in this section, savings shall include all savings realized from the downsizing of the State mental retardation centers, including the savings in direct State appropriations in the budgets of the State mental retardation centers; and

(3)       The Department of Health and Human Services, Division of Medical Assistance, shall transfer any recurring Medicaid savings resulting from the downsizing of State-operated MR centers from the ICF-MR line in Medicaid to the CAP-MR/DD line.

SECTION 10.29.(c)  The Department of Health and Human Services shall report on its progress in complying with this section to the Senate Appropriations Committee on Health and Human Services, the House of Representatives Appropriations Subcommittee on Health and Human Services, and the Fiscal Research Division. The Department shall submit the progress report no later than January 15, 2006, and submit a final report no later than May 1, 2006.

SECTION 10.29.(d)  The Department of Health and Human Services shall maintain downsizing of mental retardation centers occurring in the 2005-2006 fiscal year for the 2006-2007 fiscal year. The Department shall accomplish downsizing in accordance with this section and the State Plan for Mental Health, Developmental Disabilities, and Substance Abuse Services. The Department shall use all savings resulting from downsizing occurring on and after July 1, 2005, as set forth in subsection (b) of this section.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

PRIVATE AGENCY UNIFORM COST FINDING REQUIREMENT

SECTION 10.30.(a)  To ensure uniformity in rates charged to area programs and funded with State-allocated resources, the Division of Mental Health, Developmental Disabilities, and Substance Abuse Services of the Department of Health and Human Services may require a private agency that provides services under contract with an area program or county program, except for hospital services that have an established Medicaid rate, to complete an agency-wide uniform cost finding in accordance with G.S. 122C-147.2.  The resulting cost shall be the maximum included for the private agency in the contracting area program's unit cost finding.

SECTION 10.30.(b)  If a private agency fails to timely and accurately complete the required agency-wide uniform cost finding in a manner acceptable to the Department's controller's office, the Department may suspend all Department funding and payment to the private agency until such time as an acceptable cost finding has been completed by the private agency and approved by the Department's controller's office.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

DHHS POLICIES AND PROCEDURES IN DELIVERING COMMUNITY MENTAL HEALTH, DEVELOPMENTAL DISABILITIES, AND SUBSTANCE ABUSE SERVICES

SECTION 10.31.  The Department of Health and Human Services, Division of Mental Health, Developmental Disabilities, and Substance Abuse Services, shall in cooperation with area mental health authorities and county programs, identify and eliminate administrative and fiscal barriers created by existing State and local policies and procedures in the delivery of community-based mental health, developmental disabilities, and substance abuse services provided through the area programs and county programs, including services provided through the Comprehensive Treatment Services Program for Children and services delivered to multiply diagnosed adults.  The Department shall implement changes in policies and procedures in order to facilitate all of the following:

(1)       The provision of services to adults and children as defined in the Mental Health System Reform State Plan as priority or targeted populations.

(2)       A revised system of allocating State and federal funds to area mental health authorities and county programs that reflects projected needs, including the impact of system reform efforts rather than historical allocation practices and spending patterns.

(3)       The provision of services to children not deemed eligible for the Comprehensive Treatment Services Program for Children, but who would otherwise be in need of medically necessary treatment services to prevent out-of-home placement.

(4)       The provision of services in the community to adults remaining in and being placed in State institutions addressed in Olmstead v. L.C.

Area mental health, developmental disabilities, and substance abuse services authorities and county programs shall use all funds appropriated for and necessary to provide mental health, developmental disabilities, and substance abuse services to meet the need for these services. If excess funds are available after expending appropriated funds to fully meet service needs, one-half of these excess funds shall not revert to the General Fund but shall be transferred to the Trust Fund for Mental Health, Developmental Disabilities, and Substance Abuse Services and Bridge Funding Needs, except that one-half of the funds appropriated for the Comprehensive Treatment Services Program for Children that are unexpended and unencumbered shall not revert to the General Fund but shall be carried forward and used only for services for children and adolescents.

The Department, in consultation with the area mental health authorities and county programs, shall report to the House of Representatives Appropriations Subcommittee on Health and Human Services, the Senate Appropriations Committee on Health and Human Services, and the Joint Legislative Oversight Committee on Mental Health, Developmental Disabilities, and Substance Abuse Services on the progress in implementing these changes. The report shall be submitted on October 1, 2005, and February 1, 2006.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

IMMUNITY FOR REPORTING ABUSE AND NEGLECT

SECTION 10.32.  G.S. 122C-66 reads as rewritten:

" 122C-66.  Protection from abuse and exploitation; reporting.

(a)       An employee of or a volunteer at a facility who, other than as a part of generally accepted medical or therapeutic procedure, knowingly causes pain or injury to a client or borrows or takes personal property from a client is guilty of a Class 1 misdemeanor. Any employee or volunteer who uses reasonable force to carry out the provisions of G.S. 122C-60 or to protect himself or others from a violent client does not violate this subsection.

(a1)     An individual who witnesses or has knowledge of abuse, neglect, or exploitation of a client of a residential facility may report the incident of abuse, neglect, or exploitation to an authorized employee of the facility.

(b)       An employee of a facility who witnesses or has knowledge of a violation of subsection (a) or of an accidental injury to a client shall report the violation or accidental injury to authorized personnel designated by the facility. No employee making a report may be threatened or harassed by any other employee or volunteer on account of the report. Violation of this subsection is a Class 3 misdemeanor punishable only by a fine, not to exceed five hundred dollars ($500.00).

(c)       The identity of an individual who makes a report under this section or who cooperates in an ensuing investigation may not be disclosed without his consent, except to persons authorized by the facility or by State or federal law to investigate or prosecute these incidents, or in a grievance or personnel hearing or civil or criminal action in which a reporting individual is testifying, or when disclosure is legally compelled or authorized by judicial discovery. This subsection shall not be interpreted to require the disclosure of the identity of an individual where it is otherwise prohibited by law.

(d)       An employee or citizen who makes a report in good faith under this section is immune from any civil liability that might otherwise occur for the report. In any case involving liability, making of a report under this section is prima facie evidence that the maker acted in good faith.

(e)       The duty imposed by this section is in addition to any duty imposed by G.S. 7B-301 or G.S. 108A-102.

(f)        The facility shall investigate or provide for the investigation of all reports made under the provisions of this section."

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

RULES PERTAINING TO CONFLICT OF INTEREST IN REFERRALS TO PROVIDER AGENCIES

SECTION 10.33.  G.S. 122C-26 reads as rewritten:

" 122C-26.  Powers of the Commission.

In addition to other powers and duties, the Commission shall exercise the following powers and duties:

(1)       Adopt, amend, and repeal rules consistent with the laws of this State and the laws and regulations of the federal government to implement the provisions and purposes of this Article;

(2)       Issue declaratory rulings needed to implement the provisions and purposes of this Article;

(3)       Adopt rules governing appeals of decisions to approve or deny licensure under this Article;

(4)       Adopt rules for the waiver of rules adopted under this Article; and

(5)       Adopt rules applicable to facilities licensed under this Article:

a.         Establishing personnel requirements of staff employed in facilities;

b.         Establishing qualifications of facility administrators or directors;

c.         Establishing requirements for death reporting including confidentiality provisions related to death reporting; and

d.         Establishing requirements for patient advocates. advocates; and

e.         Requiring facility personnel who refer clients to provider agencies to disclose any pecuniary interest the referring person has in the provider agency, or other interest that may give rise to the appearance of impropriety."

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

LEGISLATIVE OVERSIGHT COMMITTEE on Mental Health, Developmental Disabilities, and Substance Abuse Services to STUDY OVERSIGHT AND MONITORING BY Department of Health and Human Services OF SERVICES TO MENTAL HEALTH CONSUMERS

SECTION 10.34.  The Legislative Oversight Committee on Mental Health, Developmental Disabilities, and Substance Abuse Services shall study the oversight and monitoring roles and activities of the Divisions of: Social Services, Facility Services, Medical Assistance, and Mental Health, Developmental Disabilities, and Substance Abuse Services, of the Department of Health and Human Services.  The study shall focus on how the oversight and monitoring activities benefit consumers of mental health, developmental disabilities, and substance abuse services in residential settings, and shall include in its report recommendations on ensuring quality of care and increasing efficiency in the provision of services.  The Oversight Committee shall report its findings and recommendations to the Senate Appropriations Committee on Health and Human Services, the House of Representatives Appropriations Subcommittee on Health and Human Services, and the Fiscal Research Division not later than April 1, 2006.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

APPEALS PROCESS FOR CLIENTS OF MENTAL HEALTH, DEVELOPMENTAL DISABILITIES, AND SUBSTANCE ABUSE SERVICES PROGRAMS

SECTION 10.35.  G.S. 122C-151.2 reads as rewritten:

" 122C-151.2.  Appeal by area authorities and county programs.programs; rules governing appeals process for clients of area authorities or county programs.

(a)       The area authority or county program may appeal to the Commission any action regarding rules under the jurisdiction of the Commission or rules under the joint jurisdiction of the Commission and the Secretary.

(b)       The area authority or county program may appeal to the Secretary any action regarding rules under the jurisdiction of the Secretary.

(b1)     The Commission shall adopt rules governing an appeals process for clients to the Division of Mental Health, Developmental Disabilities, and Substance Abuse Services and the Secretary. The appeals process shall ensure that area authority and county program services meet the requirements of applicable statutes and the rules of the Commission and the Secretary.

(c)       Appeals shall be conducted according to rules adopted by the Commission and Secretary and in accordance with Chapter 150B of the General Statutes."

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

CONTROLLED SUBSTANCES REPORTING

SECTION 10.36.(a)  Chapter 90 of the General Statutes is amended by adding a new Article to read:

"Article 5D.

"North Carolina Controlled Substances Reporting Act.

" 90-113.60.  Short title.

This Article shall be known and may be cited as the "North Carolina Controlled Substances Reporting System Act."

" 90-113.61.  Legislative findings.

The General Assembly makes the following findings:

(1)       North Carolina is experiencing an epidemic of poisoning deaths from unintentional drug overdoses.

(2)       Since 1997, the number of deaths from unintentional drug overdoses has increased threefold, from 228 deaths in 1997 to 690 deaths in 2003.

(3)       The number of unintentional deaths from illicit drugs in North Carolina has decreased since 1992 while unintentional deaths from licit drugs, primarily prescriptions, have increased.

(4)       Licit drugs are now responsible for over half of the fatal unintentional poisonings in North Carolina.

(5)       Over half of the prescription drugs associated with unintentional deaths are narcotics (opioids).

(6)       Of these licit drugs, deaths from methadone, usually prescribed as an analgesic for severe pain, have increased sevenfold since 1997.

(7)       Methadone from opioid treatment program clinics is a negligible source of the methadone that has contributed to the dramatic increase in unintentional methadone-related deaths in North Carolina.

(8)       Review of the experience of the 19 states that have active controlled substances reporting systems clearly documents that implementation of these reporting systems do not create a "chilling" effect on prescribing.

(9)       Review of data from controlled substances reporting systems help:

a.         Support the legitimate medical use of controlled substances.

b.         Identify and prevent diversion of prescribed controlled substances.

c.         Reduce morbidity and mortality from unintentional drug overdoses.

d.         Reduce the costs associated with the misuse and abuse of controlled substances.

e.         Assist clinicians in identifying and referring for treatment patients misusing controlled substances.

f.          Reduce the cost for law enforcement of investigating cases of diversion and misuse.

g.         Inform the public, including health care professionals, of the use and abuse trends related to prescription drugs.

" 90-113.62.  Definitions.

The following definitions apply in this Article:

(1)       "Controlled substance" means a controlled substance as defined in G.S. 90-87(5).

(2)       "Department" means the Department of Health and Human Services.

(3)       "Dispenser" means a person who delivers a Schedule II through V controlled substance to an ultimate user in North Carolina, but does not include any of the following:

a.         A licensed hospital or long-term care pharmacy that dispenses such substances for the purpose of inpatient administration.

b.         A person authorized to administer such a substance pursuant to Chapter 90 of the General Statutes.

c.         A wholesale distributor of a Schedule II through V controlled substance.

(4)       "Ultimate user" means a person who has lawfully obtained, and who possesses, a Schedule II through V controlled substance for his or her own use, for the use of a member of his or her household, or for the use of an animal owned or controlled by him or her or by a member of his or her household.

" 90-113.63.  Requirements for controlled substances reporting system.

The Department shall establish and maintain a reporting system of prescriptions for all Schedule II through V controlled substances. Each dispenser shall submit the information in accordance with transmission methods and frequency established by rule by the Commission. The Department may issue a waiver to a dispenser that is unable to submit prescription information by electronic means. Such waiver may permit the dispenser to submit prescription information by paper form or other means, provided all information required of electronically submitted data is submitted.

" 90-113.64.  Confidentiality.

(a)       Prescription information submitted to the Department shall be confidential and shall not be public records pursuant to G.S. 132-1. The Department may use such information for purposes of administration and enforcement. Any contractor shall be bound to maintain the confidentiality of prescription information in accordance with this section. The information may only be disclosed in accordance with subsections (b) and (c) of this section.

(b)       The Department shall, upon request, release data in the controlled substances reporting system to the following persons:

(1)       Persons authorized to prescribe or dispense controlled substances for the purpose of providing medical or pharmaceutical care for their patients.

(2)       An individual who requests the individual's own controlled substances reporting system information.

(3)       Other agencies authorized to have access to such information pursuant to the provisions of G.S. 90-107.

(4)       Primary monitoring authorities for other states if information concerns the dispensing of a Schedule II through V controlled substance to an ultimate user who resides in such state or the dispensing of a Schedule II through V controlled substance prescribed by a licensed health care practitioner whose principal place of business is located in such other state.

(5)       To a court pursuant to a lawful court order.

(c)       The Department may provide data to public or private entities for statistical, research, or educational purposes after removing information that could be used to identify individual patients who received prescriptions from dispensers.

" 90-113.65.  Commission for Mental Health, Developmental Disabilities, and Substance Abuse Services to adopt rules.

The Commission for Mental Health, Developmental Disabilities, and Substance Abuse Services shall adopt rules necessary to implement this act."

SECTION 10.36.(b)  This section becomes effective January 1, 2006.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

SENIOR CENTER OUTREACH

SECTION 10.37.(a)  Funds appropriated to the Department of Health and Human Services, Division of Aging and Adult Services, for the 2005-2007 fiscal biennium, shall be used by the Division of Aging and Adult Services to enhance senior center programs as follows:

(1)       To expand the outreach capacity of senior centers to reach unserved or underserved areas; or

(2)       To provide start-up funds for new senior centers.

All of these funds shall be allocated by October 1 of each fiscal year.

SECTION 10.37.(b)  Prior to funds being allocated pursuant to this section for start-up funds for a new senior center, the county commissioners of the county in which the new center will be located shall:

(1)       Formally endorse the need for such a center;

(2)       Formally agree on the sponsoring agency for the center; and

(3)       Make a formal commitment to use local funds to support the ongoing operation of the center.

SECTION 10.37.(c)  State funding shall not exceed seventy-five percent (75%) of reimbursable costs.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

STATE/COUNTY SPECIAL ASSISTANCE

SECTION 10.38.(a)  The eligibility of Special Assistance recipients residing in adult care homes on August 1, 1995, shall not be affected by an income reduction in the Special Assistance eligibility criteria resulting from adoption of the Rate Setting Methodology Report and Related Services, providing these recipients are otherwise eligible.  The maximum monthly rate for these residents in adult care home facilities shall be one thousand two hundred thirty-one dollars ($1,231) per month per resident.

SECTION 10.38.(b)   Effective July 1, 2005, the maximum monthly rate for residents in adult care home facilities shall be one thousand eighty-four dollars ($1,084) per month per resident unless adjusted by the Department in accordance with subsection (d) of this section.

SECTION 10.38.(c)  It is the intent of the General Assembly to protect individuals who meet current eligibility standards for State/County Special Assistance from becoming disenfranchised from the program as a result of any changes proposed in this section.  Therefore, subject to any necessary approvals by the Center for Medicare & Medicaid Services (CMS):

(1)       The eligibility of Special Assistance recipients who resided in adult care homes on September 30, 2003, and remain continuously eligible shall not be affected by an income reduction in the Special Assistance eligibility criteria, providing these recipients are otherwise eligible. The maximum monthly rate for these residents in adult care home facilities shall be one thousand ninety-one dollars ($1,091) per month per resident; and

(2)       The standard of need level for coverage eligibility under State/County Special Assistance, for individuals not enrolled or recipients of the program on September 30, 2003, shall be not less than one thousand ninety-one dollars ($1,091) per month per individual, but the monthly reimbursement rate for such individuals shall be the amount established under subsections (c) and (d) of this section. However, the Department of Health and Human Services, in its determination of reimbursement rates, may establish a minimum monthly reimbursement rate of not more than five dollars ($5.00) per month for any resident of an adult care home facility meeting the established standard of need level for coverage.

SECTION 10.38.(d)  Notwithstanding any other provision of this section, the Department of Health and Human Services shall review activities and costs related to the provision of care in adult care homes and shall determine what costs may be considered to properly maximize allowable reimbursement available through Medicaid personal care services for adult care homes (ACH-PCS) under federal law.  As determined, and with any necessary approval from the Centers for Medicare and Medicaid Services (CMS), and the approval of the Office of State Budget and Management, the Department may transfer necessary funds from the State/County Special Assistance program within the Division of Social Services to the Division of Medical Assistance and may use those funds as State match to draw down federal matching funds to pay for such activities and costs under Medicaid's personal care services for adult care homes (ACH-PCS), thus maximizing available federal funds.  The established rate for State/County Special Assistance set forth in subsection (c) of this section shall be adjusted by the Department to reflect any transfer of funds from the Division of Social Services to the Division of Medical Assistance, and related transfer costs and responsibilities from State/County Special Assistance to the Medicaid personal care services for adult care homes (ACH-PCS).  Such rate adjustments to the Special Assistance rate shall be effective with the effective date of increased reimbursement under ACH-PCS.  In no event shall the reimbursement for services through the ACH-PCS exceed the average cost of such services as determined by the Department from review of cost reports as required and submitted by adult care homes.  The Department shall report any transfers of funds and modifications of rates to the House of Representatives Appropriations Subcommittee on Health and Human Services, the Senate Appropriations Committee on Health and Human Services, and the Fiscal Research Division.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

SPECIAL ASSISTANCE IN-HOME

SECTION 10.39.(a)  The Department of Health and Human Services may use funds from the existing State-County Special Assistance for Adults budget to provide Special Assistance payments to eligible individuals in in-home living arrangements. These payments may be made for up to 800 individuals during the 2005-2006 fiscal year and the 2006-2007 fiscal year. The standard monthly payment to individuals enrolled in the Special Assistance in-home program shall be fifty percent (50%) of the monthly payment the individual would receive if the individual resided in an adult care home and qualified for Special Assistance, except if a lesser payment amount is appropriate for the individual as determined by the local case manager. For State fiscal year 2005-2006, qualified individuals shall not receive payments at rates less than they would have been eligible to receive in State fiscal year 2004-2005. The Department shall implement Special Assistance in-home eligibility policies and procedures to assure that in-home program participants are those individuals who need and, but for the in-home program, would seek placement in an adult care home facility. The Department's policies and procedures shall include the use of a functional assessment.  The Department shall make this in-home option available to all counties on a voluntary basis.  To the maximum extent possible, the Department shall consider geographic balance in the dispersion of payments to individuals across the State.

SECTION 10.39.(b)  The Department shall report on or before January 1, 2006, and on or before January 1, 2007, to the cochairs of the House of Representatives Appropriations Committee, the House of Representatives Appropriations Subcommittee on Health and Human Services, the cochairs of the Senate Appropriations Committee, and the cochairs of the Senate Appropriations Committee on Health and Human Services. This report shall include the following information:

(1)       A description of cost savings that result from allowing individuals eligible for State-County Special Assistance the option of remaining in the home.

(2)       A complete fiscal analysis of the in-home option to include all federal, State, and local funds expended.

(3)       How much case management is needed and which types of individuals are most in need of case management.

(4)       The geographic location of individuals receiving payments under this section.

(5)       A description of the services purchased with these payments.

(6)       A description of the income levels of individuals who receive payments under this section and the impact on the Medicaid program.

(7)       Findings and recommendations as to the feasibility of continuing or expanding the in-home program.

(8)       The level and quantity of services (including personal care services) provided to the demonstration project participants compared to the level and quantity of services for residents in adult care homes.

SECTION 10.39.(c)  The Department shall incorporate data collection tools designed to compare quality of life among institutionalized versus noninstitutionalized populations (i.e., an individual's perception of his or her own health and well-being, years of healthy life, and activity limitations). To the extent national standards are available, the Department shall utilize those standards.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

LICENSure of residential treatment facilities

SECTION 10.40.(a) Article 2 of Chapter 122C of the General Statutes is amended by adding the following new section to read:

" 122C-23.1.  Licensure of residential treatment facilities.

The General Assembly finds: 

(1)       That much of the care for residential treatment facility residents is paid by the State and the counties;

(2)       That the cost to the State for care for residents of residential treatment facilities is substantial, and high vacancy rates in residential treatment facilities further increase the cost of care;

(3)       That the proliferation of residential treatment facilities results in costly duplication and underuse of facilities and may result in lower quality service;

(4)       There is currently no ongoing relationship between some applicants for licensure and local management entities (LMEs) that are responsible for the placement of children and adults in residential treatment facilities; and

(5)       That it is necessary to protect the general welfare and lives, health, and property of the people of the State for the local management entity (LME) to verify that additional beds are needed in the LME's catchment area before new residential treatment facilities are licensed. This process is established to ensure that unnecessary costs to the State do not result, residential treatment facility beds are available where needed, and that individuals who need care in residential treatment facilities may have access to quality care.

Based on these findings, the Department of Health and Human Services may license new residential treatment facilities if the applicant for licensure submits with the application a letter of support obtained from the local management entity in whose catchment area the facility will be located. The letter of support shall be submitted to the Department of Health and Human Services, Division of Facility Services and Division of Mental Health, Developmental Disabilities, and Substance Abuse Services, and shall specify the number of existing beds in the same type of facility in the catchment area and the projected need for additional beds of the same type of facility. As used in this subsection, "residential treatment facility" means a "residential facility" as defined in and licensed under this Chapter, but not subject to Certificate of Need requirements under Article 9 of Chapter 131E of the General Statutes.

SECTION 10.40.(b)  This section applies to  license applications pending and license applications submitted on and after the effective date of this act.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

PLAN FOR STAR-RATING SYSTEM FOR ADULT CARE HOMES

SECTION 10.41.  The Department of Health and Human Services shall develop a plan for implementing a star-rating system for adult care homes to improve quality of care.  The Department shall report on the status and details of the plan, including a recommended timeline for implementation, to the Senate Appropriations Committee on Health and Human Services, the House of Representatives Appropriations Subcommittee on Health and Human Services, and the Fiscal Research Division not later than March 1, 2006.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

SOCIAL SERVICES COMMISSION TECHNICAL CORRECTION

SECTION 10.42.  G.S. 108A-14(a)(8) reads as rewritten:

" 108A-14.  Duties and responsibilities.

(a)       The director of social services shall have the following duties and responsibilities:

(8)       To supervise adult care homes under the rules and regulations of the Social ServicesMedical Care Commission;

."

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

Child Support Program/Enhanced Standards

SECTION 10.43.(a)  The Department of Health and Human Services shall develop and implement performance standards for each of the State and county child support enforcement offices across the State. To develop these performance standards, the Department of Health and Human Services shall evaluate other private and public child support models and national standards as well as other successful collections models. These performance standards shall include the following:

(1)       Cost per collections.

(2)       Consumer satisfaction.

(3)       Paternity establishments.

(4)       Administrative costs.

(5)       Orders established.

(6)       Collections on arrearages.

(7)       Location of absent parents.

(8)       Other related performance measures.

The Department of Health and Human Services shall monitor the performance of each office and shall implement a system of reporting that allows each local office to review its performance as well as the performance of other local offices. The Department of Health and Human Services shall publish an annual performance report that shall include the statewide and local office performance of each child support office.

SECTION 10.43.(b)  The Department of Health and Human Services shall report on its progress, in compliance with this section, to the Senate Appropriations Committee on Health and Human Services, the House of Representatives Appropriations Subcommittee on Health and Human Services, and the Fiscal Research Division by May 1, 2006.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

Child Welfare System Study

SECTION 10.44.  The Department of Health and Human Services shall conduct a study to document variations in the implementation of the Child Welfare System within North Carolina counties. The study shall include recommendations for correcting identified disparities. The study shall identify systemic issues associated with North Carolina's Child Welfare System and provide recommendations for resolving these issues. The Department shall report the results of its study to the Senate Appropriations Committee on Health and Human Services, the House of Representatives Appropriations Subcommittee on Health and Human Services, and the Fiscal Research Division no later than January 1, 2006.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

Multiple Response System

SECTION 10.45.(a)  The Department of Health and Human Services, Division of Social Services, shall continue working with local departments of social services to implement an alternative response system of child protection. Local departments of social services shall continue systems already in place. The alternative response system shall provide a family-centered approach to child protective services in which local departments of social services use family assessment tools and family support principles when responding to selected reports of suspected child abuse, neglect, and dependency, including establishing a system of care with child and family teams.

SECTION 10.45.(b)  The Department of Health and Human Services shall expand this project using both State appropriations and any non-State funding sources that can be identified for this purpose. Counties may also implement the system using existing resources.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

Foster Care and Adoption Assistance Payments

SECTION 10.46.(a)  The maximum rates for State participation in the foster care assistance program are established on a graduated scale as follows:

(1)       $390.00 per child per month for children aged birth through 5;

(2)       $440.00 per child per month for children aged 6 through 12; and

(3)       $490.00 per child per month for children aged 13 through 18.

Of these amounts, fifteen dollars ($15.00) is a special needs allowance for the child.

SECTION 10.46.(b)  The maximum rates for State participation in the adoption assistance program are established on a graduated scale as follows:

(1)       $390.00 per child per month for children aged birth through 5;

(2)       $440.00 per child per month for children aged 6 through 12; and

(3)       $490.00 per child per month for children aged 13 through 18.

SECTION 10.46.(c)  In addition to providing board payments to foster and adoptive families of HIV-infected children, as prescribed in Section 23.28 of Chapter 324 of the 1995 Session Laws, any additional funds remaining that were appropriated for this purpose shall be used to provide medical training in avoiding HIV transmission in the home.

SECTION 10.46.(d)  The maximum rates for the State participation in HIV foster care and adoption assistance are established on a graduated scale as follows:

(1)       $800.00 per child per month with indeterminate HIV status;

(2)       $1,000 per child per month confirmed HIV-infected, asymptomatic;

(3)       $1,200 per child per month confirmed HIV-infected, symptomatic; and

(4)       $1,600 per child per month terminally ill with complex care needs.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

Child Caring Institutions

SECTION 10.47.(a)  The Office of the State Auditor shall conduct an audit to evaluate overhead rates and reimbursements for child caring institutions receiving State funding. Of the funds appropriated to the Department of Health and Human Services, Office of the Controller, the sum of one hundred fifty thousand dollars ($150,000) shall be transferred to the State Auditor to conduct the audit. The audit shall include the following:

(1)       A detailed evaluation of each child caring institution's cost allocation processes.

(2)       A determination of whether the allocated costs are consistent in different agencies.

(3)       A determination of the basis used for cost allocation by each agency.

(4)       The methodology used to assign direct and indirect costs to specific child caring institution programs.

(5)       A determination of whether the overhead charged is reasonable for that specific type of nonprofit, based on national surveys.

(6)       A determination of how agency utilization rates impact the child caring institutions' cost allocation and subsequent State reimbursements.

(7)       An examination of rate-setting methodologies used by other states and how North Carolina's payment to child caring institutions compare to other states.

(8)       Recommendations on how to develop equitable, reasonable rates.

(9)       An examination of the feasibility of providing child caring institutions with the opportunity to compete based on providing the best service at least cost.

The Office of the State Auditor shall report to the Senate Appropriations Committee on Health and Human Services, the House of Representatives Appropriations Subcommittee on Health and Human Services, and the Fiscal Research Division no later than March 1, 2006. The written report shall include copies of working papers developed during the course of the audit.

SECTION 10.47.(b)  The Department of Health and Human Services shall establish standardized rates for child caring institutions in this State. These rates shall be effective January 1, 2006, and shall be updated annually on July 1. Rate-setting recommendations provided by the Office of the State Auditor shall be incorporated into the Department of Social Services rate-setting methodology.

SECTION 10.47.(c)  Until standardized rates are set, child caring institutions' maximum reimbursement shall not exceed the rate established for the specific child caring institution by the Department of Health and Human Services Office of the Controller. In determining the maximum reimbursement, counties shall include county and IV-E reimbursements.

SECTION 10.47.(d)  Minimum reimbursement for foster parents providing services through child caring institutions shall not be lower than the rates established by the General Assembly.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

Special Children Adoption Fund

SECTION 10.48.(a)  Of the funds appropriated to the Department of Health and Human Services in this act, the sum of one hundred thousand dollars ($100,000) shall be used to support the Special Children Adoption Fund for the 2005-2006 fiscal year. The Division of Social Services, in consultation with the North Carolina Association of County Directors of Social Services and representatives of licensed private adoption agencies, shall develop guidelines for the awarding of funds to licensed public and private adoption agencies upon the adoption of children described in G.S. 108A-50 and in foster care. Payments received from the Special Children Adoption Fund by participating agencies shall be used exclusively to enhance the adoption services. No local match shall be required as a condition for receipt of these funds. In accordance with State rules for allowable costs, the Special Children Adoption Fund may be used for post-adoption services for families whose income exceeds two hundred percent (200%) of the federal poverty level.

SECTION 10.48.(b)  Of the total funds appropriated for the Special Children Adoption Fund each year, twenty percent (20%) of the total funds available shall be reserved for payment to participating private adoption agencies. If the funds reserved in this subsection for payments to private agencies have not been spent on or before March 31, 2006, the Division of Social Services may reallocate those funds, in accordance with this section, to other participating adoption agencies.

SECTION 10.48.(c)  The Division of Social Services shall monitor the total expenditures in the Special Children Adoption Fund and redistribute unspent funds to ensure that the funds are used according to the guidelines established in subsection (a) of this section. The Division shall implement strategies to ensure that funds that have historically reverted for this program are used for the intended purpose. The Division shall report to the House of Representatives Appropriations Subcommittee on Health and Human Services, the Senate Appropriations Committee on Health and Human Services, and the Fiscal Research Division on the expenditures and activities of the program no later than December 1, 2005, and June 30, 2006.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

Study to identify Adoption Incentives for children who are difficult to place

SECTION 10.49.  The Department of Health and Human Services shall conduct a study to identify potential incentives for adoption of children who are difficult to place and the associated costs for each incentive. The study shall identify incentives currently in place in individual counties and the associated costs. The study shall identify funding sources available to support each incentive. The Department shall report the results of its study to the Senate Appropriations Committee on Health and Human Services, the House of Representatives Appropriations Subcommittee on Health and Human Services, and the Fiscal Research Division no later than October 1, 2005.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

Limitation on State Abortion Fund

SECTION 10.50.  The limitations on funding of the performance of abortion established in Section 23.27 of Chapter 324 of the 1995 Session Laws, as amended by Section 23.8A of Chapter 507 of the 1995 Session Laws, apply to the 2005-2006 and 2006-2007 fiscal years.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

TANF Benefit Implementation

SECTION 10.51.(a)  The General Assembly approves the plan titled "North Carolina Temporary Assistance for Needy Families State Plan FY 2005-2007", prepared by the Department of Health and Human Services and presented to the General Assembly as revised in accordance with subsection (b) of this section, except that the provision contained in the approved North Carolina Temporary Assistance for Needy Families State Plan FY 2005-2007 eliminating pay-after-performance as a benefit delivery method for two-parent families will only be implemented if the federal two-parent work participation rate is eliminated. The North Carolina Temporary Assistance for Needy Families State Plan covers the period October 1, 2005, through September 30, 2007. The Department shall submit the State Plan, as revised in accordance with subsection (b) of this section, to the United States Department of Health and Human Services, as amended by this act or any other act of the 2005 General Assembly.

SECTION 10.51.(b)  The counties approved as Electing Counties in North Carolina's Temporary Assistance for Needy Families State Plan FY 2005-2007 as approved by this section are:  Beaufort, Caldwell, Catawba, Iredell, Lenoir, Lincoln, Macon, McDowell, Sampson, and Stokes.

SECTION 10.51.(c)  Counties that submitted the letter of intent to remain as an Electing County or to be redesignated as an Electing County and the accompanying county plan for fiscal years 2005 through 2007, pursuant to G.S. 108A-27(e), shall operate under the Electing County budget requirements effective July 1, 2005. For programmatic purposes, all counties referred to in this subsection shall remain under their current county designation through September 30, 2005.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

Residential Schools Reporting

SECTION 10.52.  The Office of Education Services shall report not later than December 1, 2005, to the Senate Appropriations Committee on Health and Human Services, the House of Representatives Appropriations Subcommittee on Health and Human Services, and the Fiscal Research Division on the activities of the Eastern North Carolina School for the Deaf at Wilson, the North Carolina School for the Deaf at Morganton, and the Governor Morehead School for the Blind. The report shall include enrollment numbers at the schools, the budgets, and the academic status of the schools as defined under the ABCs program.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

FUNDS for school nurses

SECTION 10.53.  Of the funds appropriated in this act to the Department of Health and Human Services, the sum of two million five hundred thousand dollars ($2,500,000) for the 2005-2006 fiscal year, and the sum of two million five hundred thousand dollars ($2,500,000) for the 2006-2007 fiscal year shall be used for the school nurse funding initiative.  The Department of Health and Human Services, Division of Public Health, in conjunction with the Department of Public Instruction, shall provide funds to communities to hire school nurses.  The program will fund 50 permanent local nurses. The criteria shall include determining the areas in greatest need for school nurses with the greatest inability to pay for these nurses. Other criteria to be considered shall include:  (i) the current nurse-to-student ratio; (ii) the economic status of the community; and (iii) the health needs of area children.

There shall be no supplanting of local, State, or federal funds with these funds. Communities shall maintain their current level of effort and funding for school nurses. These funds shall not be used for funding nurses for State agencies. All funding shall be used for direct services.

The Department of Health and Human Services shall report on the use of funds allocated under this section by December 1, 2005, to the Senate Appropriations Committee on Health and Human Services, the House of Representatives Appropriations Subcommittee on Health and Human Services, and the Fiscal Research Division.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

EARLY INTERVENTION REPORTING AND EVALUATION

SECTION 10.54.(a)  The Department of Health and Human Services, Division of Public Health, shall report on Early Intervention services. The report shall include the number of children served, the number and types of services and evaluations provided, and the budget for each Children's Developmental Services Agency. In addition, the Division of Public Health shall evaluate its Early Intervention Program provider network, including provider certification and continuing education requirements.

SECTION 10.54.(b)  The Department of Health and Human Services shall analyze the reimbursement rates for Early Intervention services, and may adjust rates according to the findings of the analysis.

SECTION 10.54.(c)  The Division of Public Health shall analyze the program funding for the Children with Special Needs Program and shall develop a plan to utilize these funds within the Early Intervention Program. The Division shall report its findings and recommendations to the Senate Appropriations Committee on Health and Human Services, the House of Representatives Appropriations Subcommittee on Health and Human Services, and the Fiscal Research Division not later than December 1, 2005.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

CONTRACTING FOR more effective COMBINATION VACCINES

SECTION 10.55.  The Department of Health and Human Services may contract for the purchase of new combination vaccines that are more expensive than currently used combination or single component vaccines only if the new, more expensive combination vaccine is more effective than the currently used combination or single component vaccine it replaces.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

CHRONIC DISEASE PREVENTION ACTIVITIES INVENTORY

SECTION 10.56.  In order to reduce costs and eliminate duplication of effort, the Department of Health and Human Services shall create an inventory of all chronic disease prevention activities, funding, staffing, and other resources for these activities, including funding and resources for related task forces and committees. The inventory shall include at a minimum, heart disease, stroke, diabetes, osteoporosis, and cancer. The Department shall create a plan to combine task forces and activities for chronic disease prevention and shall explore collapsing these task forces and committees into the Healthy Carolinians structure. The Department shall report on the inventory and the Department's recommendations not later than February 1, 2006, to the Senate Appropriations Committee on Health and Human Services, the House of Representatives Appropriations Subcommittee on Health and Human Services, and the Fiscal Research Division.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

PILOT PROGRAM FOR AUTOMATIC EXTERNAL DEFIBRILLATORS IN PUBLIC BUILDINGS

SECTION 10.57.(a)  The Department of Health and Human Services, Division of Public Health, shall develop a pilot program to place Automated External Defibrillators (AED) in public buildings, including public gymnasiums, that do not have an operational AED in place. In selecting pilot sites, the Department shall ensure geographic representation of the State.

SECTION 10.57.(b)  Of the funds appropriated in this act to the Department of Health and Human Services, the sum of seventeen thousand dollars ($17,000) for the 2005-2006 fiscal year, and the sum of six thousand dollars ($6,000) for the 2006-2007 fiscal year shall be used to purchase AED units, conduct on-site training at the pilot sites, and conduct ongoing education and awareness campaigns to the general public in the piloted sites. The Department shall ensure that training in the use of an AED shall be conducted in accordance with G.S. 90-21.15(b)(3). The Heart Disease and Stroke Prevention Branch of the Division of Public Health shall be responsible for the purchase of AEDs, the training of pilot program participants, and evaluation of the pilot program.

SECTION 10.57.(c)  The Department of Health and Human Services shall report on the location, establishment, and implementation of the pilot sites to the Senate Appropriations Committee on Health and Human Services, the House of Representatives Appropriations Subcommittee on Health and Human Services, and the Fiscal Research Division on or before March 1, 2006.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

IMMUNIZATION PROGRAM FUNDING

SECTION 10.58.(a)  Of the funds appropriated in this act to the Department of Health and Human Services for childhood immunization programs for positions, operating support, equipment, and pharmaceuticals, the sum of one million dollars ($1,000,000) for the 2005-2006 fiscal year and the sum of one million dollars ($1,000,000) for the 2006-2007 fiscal year may be used for projects and activities that are also designed to increase childhood immunization rates in North Carolina. These projects and activities shall include the following:

(1)       Outreach efforts at the State and local levels to improve service delivery of vaccines. Outreach efforts may include educational seminars, media advertising, support services to parents to enable children to be transported to clinics, longer operating hours for clinics, and mobile vaccine units.

(2)       Continued development of an automated immunization registry.

SECTION 10.58.(b)  Funds authorized to be used for immunization efforts under subsection (a) of this section shall not be used to fund additional State positions in the Department of Health and Human Services or contracts, except for contracts to develop an automated immunization registry or contracts with local health departments for outreach.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

AIDS DRUG ASSISTANCE PROGRAM

SECTION 10.59.(a)  For the 2005-2006 fiscal year and for the 2006-2007 fiscal year, HIV-positive individuals with incomes at or below one hundred twenty-five percent (125%) of the federal poverty level are eligible for participation in ADAP. Eligibility for participation in ADAP during the 2005-2007 fiscal biennium shall not be extended to individuals with incomes above one hundred twenty-five percent (125%) of the federal poverty level.

SECTION 10.59.(b)  The Department of Health and Human Services shall make an interim report on ADAP program utilization by January 1, 2006, and a final report on ADAP program utilization by May 1, 2006, to the Senate Appropriations Committee on Health and Human Services, the House of Representatives Appropriations Subcommittee on Health and Human Services, and the Fiscal Research Division on ADAP. The reports shall include ADAP program utilization as follows:

(1)       Monthly data on total cumulative AIDS/HIV cases reported in North Carolina.

(2)       Monthly data on the number of individuals who have applied to participate in ADAP that have been determined to be ineligible.

(3)       Monthly data on the income level of participants in ADAP and of individuals who have applied to participate in ADAP who have been determined to be ineligible.

(4)       Monthly data on fiscal year-to-date expenditures of ADAP. The interim report shall contain monthly data on the calendar year-to-date expenditures of ADAP.

(5)       An update on the status of the information management system.

(6)       Monthly data on ADAP usage patterns and demographics of participants in ADAP.

(7)       Fiscal year-to-date budget information.

(8)       The status of the new system of management for ADAP, the costs savings realized from the new system, and recommendations for improving the system.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

Child Care Funds Matching Requirement

SECTION 10.60.  No local matching funds may be required by the Department of Health and Human Services as a condition of any locality's receiving any State child care funds appropriated by this act unless federal law requires a match. This shall not prohibit any locality from spending local funds for child care services.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

Child Care Allocation Formula

SECTION 10.61.(a)  The Department of Health and Human Services shall allocate child care subsidy voucher funds to pay the costs of necessary child care for minor children of needy families. The mandatory thirty percent (30%) Smart Start subsidy allocation under G.S. 143B-168.15(g) shall constitute the base amount for each county's child care subsidy allocation. The Department of Health and Human Services shall use the following method when allocating federal and State child care funds, not including the aggregate mandatory thirty percent (30%) Smart Start subsidy allocation:

(1)       Funds shall be allocated based upon the projected cost of serving children in a county under age 11 in families with all parents working who earn less than seventy-five percent (75%) of the State median income.

(2)       No county's allocation shall be less than ninety percent (90%) of its State Fiscal Year 2001-2002 initial child care subsidy allocation.

SECTION 10.61.(b)  The Department of Health and Human Services may reallocate unused child care subsidy voucher funds in order to meet the child care needs of low-income families. Any reallocation of funds shall be based upon the expenditures of all child care subsidy voucher funding, including Smart Start funds, within a county.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

Child Care Subsidy Rates

SECTION 10.62.(a)  The maximum gross annual income for initial eligibility, adjusted biennially, for subsidized child care services shall be seventy-five percent (75%) of the State median income, adjusted for family size.

SECTION 10.62.(b)  Fees for families who are required to share in the cost of care shall be established based on a percent of gross family income and adjusted for family size. Fees shall be determined as follows:

FAMILY SIZE                        PERCENT OF GROSS FAMILY INCOME

1-3                                                                       10%

4-5                                                                         9%

6 or more                                                              8%.

SECTION 10.62.(c)  Payments for the purchase of child care services for low-income children shall be in accordance with the following requirements:

(1)       Religious-sponsored child care facilities operating pursuant to G.S. 110-106 and licensed child care centers and homes that meet the minimum licensing standards that are participating in the subsidized child care program shall be paid the one-star county market rate or the rate they charge privately paying parents, whichever is lower.

(2)       Licensed child care centers and homes with two or more stars shall receive the market rate for that rated license level for that age group or the rate they charge privately paying parents, whichever is lower.

(3)       Nonlicensed homes shall receive fifty percent (50%) of the county market rate or the rate they charge privately paying parents, whichever is lower.

(4)       Maximum payment rates shall also be calculated periodically by the Division of Child Development and School Readiness for transportation to and from child care provided by the child care provider, individual transporter, or transportation agency, and for fees charged by providers to parents. These payment rates shall be based upon information collected by market rate surveys.

SECTION 10.62.(d)  Provisions of payment rates for child care providers in counties that do not have at least 50 children in each age group for center-based and home-based care are as follows:

(1)       Except as applicable in subdivision (2) of this subsection, payment rates shall be set at the statewide or regional market rate for licensed child care centers and homes.

(2)       If it can be demonstrated that the application of the statewide or regional market rate to a county with fewer than 50 children in each age group is lower than the county market rate and would inhibit the ability of the county to purchase child care for low-income children, then the county market rate may be applied.

SECTION 10.62.(e)  A market rate shall be calculated for child care centers and homes at each rated license level for each county and for each age group or age category of enrollees and shall be representative of fees charged to unsubsidized privately paying parents for each age group of enrollees within the county. The Division of Child Development and School Readiness shall also calculate a statewide rate and regional market rates for each rated license level for each age category.

SECTION 10.62.(f)  Facilities licensed pursuant to Article 7 of Chapter 110 of the General Statutes and facilities operated pursuant to G.S. 110-106 may participate in the program that provides for the purchase of care in child care facilities for minor children of needy families. No separate licensing requirements shall be used to select facilities to participate. In addition, child care facilities shall be required to meet any additional applicable requirements of federal law or regulations. Child care arrangements exempt from State regulation pursuant to Article 7 of Chapter 110 of the General Statutes shall meet the requirements established by other State law and by the Social Services Commission.

County departments of social services or other local contracting agencies shall not use a provider's failure to comply with requirements in addition to those specified in this subsection as a condition for reducing the provider's subsidized child care rate.

SECTION 10.62.(g)  Payment for subsidized child care services provided with Work First Block Grant funds shall comply with all regulations and policies issued by the Division of Child Development and School Readiness for the subsidized child care program.

SECTION 10.62.(h)  Noncitizen families who reside in this State legally shall be eligible for child care subsidies if all other conditions of eligibility are met. If all other conditions of eligibility are met, noncitizen families who reside in this State illegally shall be eligible for child care subsidies only if at least one of the following conditions is met:

(1)       The child for whom a child care subsidy is sought is receiving child protective services or foster care services.

(2)       The child for whom a child care subsidy is sought is developmentally delayed or at risk of being developmentally delayed.

(3)       The child for whom a child care subsidy is sought is a citizen of the United States.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

Child Care Revolving Loan

SECTION 10.63.  Notwithstanding any law to the contrary, funds budgeted for the Child Care Revolving Loan Fund may be transferred to and invested by the financial institution contracted to operate the Fund. The principal and any income to the Fund may be used to make loans, reduce loan interest to borrowers, serve as collateral for borrowers, pay the contractor's cost of operating the Fund, or pay the Department's cost of administering the program.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

EARLY CHILDHOOD EDUCATION AND DEVELOPMENT INITIATIVES ENHANCEMENTS

SECTION 10.64.(a)  Administrative costs shall be equivalent to, on an average statewide basis for all local partnerships, not more than eight percent (8%) of the total statewide allocation to all local partnerships. For purposes of this subsection, administrative costs shall include costs associated with partnership oversight, business and financial management, general accounting, human resources, budgeting, purchasing, contracting, and information systems management.

SECTION 10.64.(b)  The North Carolina Partnership for Children, Inc., and all local partnerships shall use competitive bidding practices in contracting for goods and services on contract amounts as follows:

(1)       For amounts of five thousand dollars ($5,000) or less, the procedures specified by a written policy to be developed by the Board of Directors of the North Carolina Partnership for Children, Inc.

(2)       For amounts greater than five thousand dollars ($5,000), but less than fifteen thousand dollars ($15,000), three written quotes.

(3)       For amounts of fifteen thousand dollars ($15,000) or more, but less than forty thousand dollars ($40,000), a request for proposal process.

(4)       For amounts of forty thousand dollars ($40,000) or more, a request for proposal process and advertising in a major newspaper.

SECTION 10.64.(c)  The North Carolina Partnership for Children, Inc., and all local partnerships shall, in the aggregate, be required to match no less than fifty percent (50%) of the total amount budgeted for the program in each fiscal year of the biennium as follows:  contributions of cash equal to at least fifteen percent (15%) and in-kind donated resources equal to no more than five percent (5%) for a total match requirement of twenty percent (20%) for each fiscal year. The North Carolina Partnership for Children, Inc., may carry-forward any amount in excess of the required match for a fiscal year in order to meet the match requirement of the succeeding fiscal year. Only in-kind contributions that are quantifiable shall be applied to the in-kind match requirement. Volunteer services may be treated as an in-kind contribution for the purpose of the match requirement of this subsection. Volunteer services that qualify as professional services shall be valued at the fair market value of those services. All other volunteer service hours shall be valued at the statewide average wage rate as calculated from data compiled by the Employment Security Commission in the Employment and Wages in North Carolina Annual Report for the most recent period for which data are available. Expenses, including both those paid by cash and in-kind contributions, incurred by other participating non-State entities contracting with the North Carolina Partnership for Children, Inc., or the local partnerships, also may be considered resources available to meet the required private match. In order to qualify to meet the required private match, the expenses shall:

(1)       Be verifiable from the contractor's records.

(2)       If in-kind, other than volunteer services, be quantifiable in accordance with generally accepted accounting principles for nonprofit organizations.

(3)       Not include expenses funded by State funds.

(4)       Be supplemental to and not supplant preexisting resources for related program activities.

(5)       Be incurred as a direct result of the Early Childhood Initiatives Program and be necessary and reasonable for the proper and efficient accomplishment of the Program's objectives.

(6)       Be otherwise allowable under federal or State law.

(7)       Be required and described in the contractual agreements approved by the North Carolina Partnership for Children, Inc., or the local partnership.

(8)       Be reported to the North Carolina Partnership for Children, Inc., or the local partnership by the contractor in the same manner as reimbursable expenses.

Failure to obtain a twenty percent (20%) match by June 30 of each fiscal year shall result in a dollar-for-dollar reduction in the appropriation for the Program for a subsequent fiscal year. The North Carolina Partnership for Children, Inc., shall be responsible for compiling information on the private cash and in-kind contributions into a report that is submitted to the Joint Legislative Commission on Governmental Operations in a format that allows verification by the Department of Revenue. The same match requirements shall apply to any expansion funds appropriated by the General Assembly.

SECTION 10.64.(d)  The Department of Health and Human Services shall continue to implement the performance-based evaluation system.

SECTION 10.64.(e)  The Department of Health and Human Services and the North Carolina Partnership for Children, Inc., shall ensure that the allocation of funds for Early Childhood Education and Development Initiatives for State fiscal years 2005-2006 and 2006-2007 shall be administered and distributed in the following manner:

(1)       Capital expenditures are prohibited for fiscal years 2005-2006 and 2006-2007. For the purposes of this section, "capital expenditures" means expenditures for capital improvements as defined in G.S. 143-34.40.

(2)       Expenditures of State funds for advertising and promotional activities are prohibited for fiscal years 2005-2006 and 2006-2007.

SECTION 10.64.(f)  A county may use the county's allocation of State and federal child care funds to subsidize child care according to the county's Early Childhood Education and Development Initiatives Plan as approved by the North Carolina Partnership for Children, Inc. The use of federal funds shall be consistent with the appropriate federal regulations. Child care providers shall, at a minimum, comply with the applicable requirements for State licensure pursuant to Article 7 of Chapter 110 of the General Statutes.

 

Requested by:            Senators Purcell, Malone, Hagan, Garrou, Dalton

Smart Start Funding Study

SECTION 10.65.(a)  The North Carolina Partnership for Children, Inc., shall study its allocation of funds to local partnerships. The North Carolina Partnership for Children, Inc., shall study funding equity among all counties and local partnerships based on population, the number of children from birth to five years of age residing in the county region, economic indicators, and the quality of existing child care. The North Carolina Partnership for Children, Inc., shall develop strategies to alleviate the inequity of funds to local partnerships.

SECTION 10.65.(b)  The North Carolina Partnership for Children, Inc., shall report its findings and recommendations to the Senate Appropriations Committee on Health and Human Services, the House of Representatives Appropriations Subcommittee on Health and Human Services, and the Fiscal Research Division on or before March 1, 2006.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

Analyze Child Care Subsidy Reimbursement System

SECTION 10.66.(a)  The Department of Health and Human Services, Division of Child Development and School Readiness, shall conduct an analysis of the child care subsidy reimbursement system. The Division of Child Development and School Readiness shall conduct the analysis as follows:

(1)       Compare surveyed rates from the 2005 child care market survey to existing reimbursement rates and identify counties and levels of disparity of current market rates to subsidy reimbursements.

(2)       Compare overall compensation for child care workers by county and determine if there is a correlation with child care quality and subsidy reimbursements.

(3)       Examine the impact of North Carolina Partnership for Children, Inc., funding on child care market rates and quality of child care by comparing the length of time local partnerships have been present in counties, the amount local partnerships spend on child care quality initiatives, the number of higher quality child care centers and homes, and the allocation to the county by percentage of need.

(4)       Examine, by county, the prevalence of child care providers who charge parents a differential fee to make up the difference between private and subsidy reimbursement rates.

(5)       Examine the impact that child care reimbursement rates have on providing families access to all levels of child care.

SECTION 10.66.(b)  The Division of Child Development and School Readiness shall develop strategies to implement market rate equity among counties and submit a report of its findings and recommendations to the Senate Appropriations Committee on Health and Human Services, the House of Representatives Appropriations Subcommittee on Health and Human Services, and the Fiscal Research Division by January 30, 2006.

 

Requested by:            Senators Purcell, Malone, Garrou, Dalton, Hagan

MORE AT FOUR

SECTION 10.67.(a)  Of the funds appropriated in this act to the Department of Health and Human Services, the sum of sixty-six million five hundred forty-six thousand six hundred fifty-three dollars ($66,546,653) for the 2005-2006 fiscal year and the sum of seventy-nine million one hundred nine thousand seven hundred seventy-nine dollars ($79,109,779) for the 2006-2007 fiscal year shall be used to implement "More At Four", a voluntary prekindergarten program for at-risk four-year-olds.

SECTION 10.67.(b)  The Department of Health and Human Services, Division of Child Development and School Readiness, shall continue the implementation of the "More At Four" prekindergarten program for at-risk four-year-olds who are at risk of failure in kindergarten. The program is available statewide to all counties that choose to participate, including underserved areas. The goal of the program is to provide quality prekindergarten services to a greater number of at-risk children in order to enhance kindergarten readiness for these children. The program shall be consistent with standards and assessments established jointly by the Department of Health and Human Services and the Department of Public Instruction. The program shall include:

(1)       A process and system for identifying children at risk of academic failure.

(2)       A process and system for identifying children who are not being served first priority in formal early education programs, such as child care, public or private preschools, Head Start, Early Head Start, early intervention programs, or other such programs, who demonstrate educational needs, and who are eligible to enter kindergarten the next school year, as well as children who are underserved.

(3)       A curriculum or several curricula that are recommended by the North Carolina Child Development and School Readiness Task Force (hereinafter "Task Force"). The Task Force will identify and approve appropriate research-based curricula. These curricula shall: (i) focus primarily on oral language and emergent literacy; (ii) engage children through key experiences and provide background knowledge requisite for formal learning and successful reading in the early elementary years; (iii) involve active learning; (iv) promote measurable kindergarten language-readiness skills that focus on emergent literacy and mathematical skills; and (v) develop skills that will prepare children emotionally and socially for kindergarten.

(4)       An emphasis on ongoing family involvement with the prekindergarten program.

(5)       Evaluation of child progress through pre- and postassessment of children in the statewide evaluation, as well as ongoing assessment of the children by teachers.

(6)       Guidelines for a system to reimburse local school boards and systems, private child care providers, and other entities willing to establish and provide prekindergarten programs to serve at-risk children.

(7)       A system built upon existing local school boards and systems, private child care providers, and other entities that demonstrate the ability to establish or expand prekindergarten capacity.

(8)       A quality-control system. Participating providers shall comply with standards and guidelines as established by the Department of Health and Human Services, the Department of Public Instruction, and the Task Force. The Department may use the child care rating system to assist in determining program participation.

(9)       Standards for minimum teacher qualifications. A portion of the classroom sites initially funded shall have at least one teacher who is certified or provisionally certified in birth-to-kindergarten education.

(10)     A local contribution. Programs must demonstrate that they are accessing resources other than "More At Four".

(11)     A system of accountability.

(12)     Consideration of the reallocation of existing funds. In order to maximize current funding and resources, the Department of Health and Human Services, the Department of Public Instruction, and the Task Force shall consider the reallocation of existing funds from State and local programs that provide prekindergarten-related care and services.

SECTION 10.67.(c)  The Department of Health and Human Services shall plan for expansion of the "More At Four" program within existing resources to include four- and five-star-rated centers and schools serving four-year-olds and develop guidelines for these programs. The Department shall analyze guidelines for use of the "More At Four" funds, State subsidy funds, and Smart Start subsidy funds and devise a complementary plan for administration of funds for all four-year-old classrooms. The four- and five-star-rated centers that choose to become a "More At Four" program shall, at a minimum, receive curricula and access to training and workshops for "More At Four" programs and be considered along with other "More At Four" programs for T.E.A.C.H. funding. The Department shall ensure that no individual receives funding from more than one source for the same purpose or activity during the same funding period. For purposes of this subsection, sources shall include T.E.A.C.H., W.A.G.E.$., and T.E.A.C.H. Health Insurance programs for individual recipients.

The "More At Four" program shall review the number of slots filled by counties on a monthly basis and shift the unfilled slots to counties with waiting lists. The shifting of slots shall occur through December 30, 2005, at which time any remaining funds for slots unfilled shall be used to meet the needs of the waiting list for subsidized child care.

SECTION 10.67.(d)  The Department of Health and Human Services, Division of Child Development and School Readiness, and the Task Force shall submit a report by February 1, 2006, to the Joint Legislative Commission on Governmental Operations, the Joint Legislative Education Oversight Committee, the Senate Appropriations Committee on Health and Human Services, the House of Representatives Appropriations Subcommittee on Health and Human Services, and the Fiscal Research Division. This final report shall include the following:

(1)       The number of children participating in the program.

(2)       The number of children participating in the program who have never been served in other early education programs, such as child care, public or private preschool, Head Start, Early Head Start, or early intervention programs.

(3)       The expected expenditures for the programs and the source of the local match for each grantee.

(4)       The location of program sites and the corresponding number of children participating in the program at each site.

(5)       Activities involving Child Find in counties.

(6)       A comprehensive cost analysis of the program, including the cost per child served by the program.

(7)       The plan for expansion of "More At Four" through existing resources as outlined in this section.

SECTION 10.67.(e)  For the 2005-2006 and the 2006-2007 fiscal years, the "More At Four" program shall establish income eligibility requirements for the program not to exceed seventy-five percent (75%) of the State median income to make the program consistent with the child care subsidy requirements. Up to twenty percent (20%) of children enrolled may have family incomes in excess of seventy-five percent (75%) of median income if they have other designated risk factors.

SECTION 10.67.(f)  The "More At Four" program funding shall not supplant any funding for classrooms serving four-year-olds as of the 2003-2004 fiscal year.

SECTION 10.67.(g)  The Department of Health and Human Services, Division of Child Development and School Readiness, shall review and evaluate the early literacy project in Davie County and consider incorporation of this curriculum into the "More At Four" program.

SECTION 10.67.(h)  The "More At Four" program shall contract with Prevent Blindness of North Carolina for one hundred fifty thousand dollars ($150,000) for vision screenings for children in the "More At Four" program and other child care classrooms.

SECTION 10.67.(i)  The "More At Four" program shall provide a grant of one hundred seventy-seven thousand dollars ($177,000) to the Carolina Children's Communicative Disorders Program at the University of North Carolina at Chapel Hill.

 

Requested by:            Senators Garrou, Dalton, Hagan 

Establish the division of child development and School Readiness in the department of health AND human services

SECTION 10.68.(a)  The Division of Child Development of the Department of Health and Human Services is renamed the Division of Child Development and School Readiness (hereinafter "the Division").  The purpose of the Division is to regulate and license child care facilities, administer the five-star rating system of child care facilities, and ensure school readiness for North Carolina's children through increased coordination and effectiveness of the State's early care and education programs and through improved transitions for at-risk children into kindergarten.  In addition, the Division shall have oversight of all prekindergarten programs serving three- and four-year-olds, which includes the More at Four prekindergarten programs, and shall expand the focus of the programs, thereby developing increased collaboration between local Head Start programs and the State's prekindergarten programs as well as private child care programs. The Division shall collaborate with the Department of Public Instruction to develop a common statewide assessment and to promote improved transition practices for children entering kindergarten.

SECTION 10.68.(b)  The More at Four Prekindergarten Program is transferred from the Office of the Governor to the Department of Health and Human Services, Division of Child Development and School Readiness.  This transfer shall have all the elements of a Type I transfer, as defined in G.S. 143A-6.

SECTION 10.68.(c)  The Head Start Collaboration Office shall remain in the Department of Health and Human Services under the Division of Child Development and School Readiness.

SECTION 10.68.(d)  The North Carolina Partnership for Children, Inc., shall continue to be funded through, and work cooperatively with, the Department of Health and Human Services, the Division of Child Development and School Readiness.

SECTION 10.68.(e)  The More at Four Task Force shall be reconstituted and renamed the North Carolina Child Development and School Readiness Task Force. The Secretary of the Department of Health and Human Services shall appoint the members of the North Carolina Child Development and School Readiness Task Force from representatives of publicly funded programs and services for children age birth to five years, including the More at Four Prekindergarten Program, the North Carolina Partnership for the Children, Inc., Early Intervention, preschool programs in the public schools and other stakeholders, including Head Start.

The Task Force shall study the integration of public funds and programs to ensure that all North Carolina's children age birth to five years are prepared to come to school ready to achieve. In conducting the study, the Task Force shall consider and develop recommendations for the following:

(1)       Creating principles, rationale, strategies, structure, and outcomes for the integration of all funding and programs that serve children age birth to five years to achieve improved school readiness;

(2)       Eliminating the duplication of programs;

(3)       Enhancing the quality and performance of current programs;

(4)       Creating performance measures that will document outcomes for programs and children and will provide accessible service for families;

(5)       Creating effective transition plans as children move from one program or service to another;

(6)       Documenting all current funding and programs for children ages birth to kindergarten entry and coordination of existing data systems; and

(7)       Equalizing the funding of the various programs that provide services to children from birth to the age of five years to ensure equity in accessibility to these programs.

The Task Force shall submit a report by April 1, 2006, to the President Pro Tempore of the Senate, the Speaker of the House of Representatives, the Chairs of the Senate Appropriations Committee on Health and Human Services, the Chairs of the House of Representatives Appropriations Subcommittee on Health and Human Services, and the Fiscal Research Division.

SECTION 10.68.(f)  The Revisor of Statutes shall substitute the term "Division of Child Development and School Readiness" for the term "Division of Child Development" everywhere those terms appear in the following sections of the General Statutes:

G.S. 110-90.2.     Mandatory child care providers' criminal history checks.

G.S. 110-102.      Information for parents.

G.S. 114-19.5.     Criminal record checks of child care providers.

G.S. 143B-138.1. Department of Health and Human Service functions and organization.

SECTION 10.68.(g)   This section becomes effective July 1, 2005, for organizational changes.  The budgetary adjustments required by this section become effective October 1, 2005.

 

PART XI. DEPARTMENT OF Agriculture and consumer Services

 

Requested by:            Senators Weinstein, Garrou, Dalton, Hagan

Pesticide Disposal Program

SECTION 11.1.  G.S. 143-468(b) reads as rewritten:

"(b)      The Pesticide Environmental Trust Fund is established as a nonreverting account within the Department of Agriculture and Consumer Services. The Department of Agriculture and Consumer Services shall administer the Fund. The additional assessment imposed by G.S. 143-442(b) on the registration of a brand or grade of pesticide shall be credited to the Fund. The Department shall distribute money in the Fund as follows:

(1)       Two and one-half percent (2.5%) to North Carolina State University Cooperative Extension Service to enhance its agromedicine efforts in cooperation with East Carolina University School of Medicine.

(2)       Two and one-half percent (2.5%) to East Carolina University School of Medicine to enhance its agromedicine efforts in cooperation with North Carolina State University Cooperative Extension Service.

(3)       Twenty percent (20%) to North Carolina State University, Department of Toxicology, to establish and maintain an extension agromedicine specialist position.

(4)       Seventy-five percent (75%) to the Department of Agriculture and Consumer Services for the costs of administering its pesticide disposal program, including the salaries and support of staff for the pesticide disposal program, and for its environmental programs, as directed by the Board, including establishing a pesticide container management program to enhance its pesticide disposal program and its water quality initiatives."

 

Requested by:            Senators Weinstein, Garrou, Dalton, Hagan

tiMBER SALES RECEIPTS FOR CAPITAL IMPROVEMENTS AT AGRICULTURAL RESEARCH STATIONS AND FARMS

SECTION 11.2.  The sum of one million thirty-three thousand one hundred dollars ($1,033,100) shall be transferred from the Department of Agriculture and Consumer Services' timber sales capital improvement account in the Department of Agriculture and Consumer Services as such funds become available during the 2005-2006 fiscal year, and used by the Department for the following capital improvements projects at agricultural research stations and research farms:

(1)       $378,000 for improvements at the swine facility at the Cherry Research Farm.

(2)       $285,500 for renovation of dairy facilities at the Cherry Research Farm.

(3)       $369,600 for land acquisition and development at the Tidewater Research Station.

 

Requested by:            Senators Weinstein, Garrou, Dalton, Hagan

Plant Conservation Program Funds

SECTION 11.3.  From funds received from the sale of timber that are deposited with the State Treasurer pursuant to G.S. 146-30 to the credit of the Department of Agriculture and Consumer Services in a capital improvement account, the sum of twenty thousand dollars ($20,000) shall be transferred to the Department of Agriculture and Consumer Services to be used by the Department for its plant conservation program under Article 19B of Chapter 106 of the General Statutes for costs incidental to the acquisition of land, such as land appraisals, land surveys, title searches, and environmental studies.

 

Requested by:            Senators Kerr, Garrou, Dalton, Hagan

Increase Funds for North Carolina Grape Growers Council

SECTION 11.4.  G.S. 105-113.81A reads as rewritten:

" 105-113.81A.  Distribution of part of wine taxes attributable to North Carolina wine.

The Secretary shall on a quarterly basis credit to the Department of Agriculture and Consumer Services the net proceeds of the excise tax collected on unfortified wine bottled in North Carolina during the previous quarter and the net proceeds of the excise tax collected on fortified wine bottled in North Carolina during the previous quarter, except that the amount credited to the Department of Agriculture and Consumer Services under this section shall not exceed three hundred fifty thousand dollars ($350,000) five hundred thousand dollars ($500,000) per fiscal year. The Department of Agriculture and Consumer Services shall allocate the funds received under this section to the North Carolina Grape Growers Council to be used to promote the North Carolina grape and wine industry and to contract for research and development services to improve viticultural and enological practices in North Carolina. Any funds credited to the Department of Agriculture and Consumer Services under this section that are not expended by June 30 of any fiscal year may not revert to the General Fund, but shall remain available to the Department for the uses set forth in this section."

 

PART XII. DEPARTMENT OF ENVIRONMENT AND NATURAL RESOURCES

 

Requested by:            Senators Weinstein, Garrou, Dalton, Hagan

State Match for Federal Safe Drinking Water Act Funds

SECTION 12.1.  Notwithstanding the provisions of Chapter 159G of the General Statutes, the Department of Environment and Natural Resources may transfer from the General Water Supply Revolving Loan Account up to one million five hundred thousand dollars ($1,500,000) to the Department of Environment and Natural Resources to be used to match the federal grant moneys authorized by section 1452 of the federal Safe Drinking Water Act amendments of 1996 for the 2005-2006 fiscal year. The General Water Supply Revolving Loan Account is an account under the Clean Water Revolving Loan and Grant Fund and is established under G.S. 159G-4. The Clean Water Revolving Loan and Grant Fund is established by G.S. 159G-5.

 

Requested by:            Senators Weinstein, Garrou, Dalton, Hagan

Expand Express Review Program Statewide

SECTION 12.2.(a)  Part 1 of Article 7 of Chapter 143B of the General Statutes is amended by adding two new sections to read:

" 143B-279.13.  Express permit and certification reviews.

(a)       The Department of Environment and Natural Resources shall develop an express review program to provide express permit and certification reviews in all of its regional offices. Participation in the express review program is voluntary, and the program is to become supported by the fees determined pursuant to subsection (b) of this section. The Department of Environment and Natural Resources shall determine the project applications to review under the express review program from those who request to participate in the program. The express review program may be applied to any one or all of the permits, approvals, or certifications in the following programs: the erosion and sedimentation control program, the coastal management program, and the water quality programs, including water quality certifications and stormwater management. The express review program shall focus on the following permits or certifications:

(1)       Stormwater permits under Part 1 of Article 21 of Chapter 143 of the General Statutes.   

(2)       Stream origination certifications under Article 21 of Chapter 143 of the General Statutes.

(3)       Water quality certification under Article 21 of Chapter 143 of the General Statutes.

(4)       Erosion and sedimentation control permits under Article 4 of Chapter 113A of the General Statutes.

(5)       Permits under the Coastal Area Management Act (CAMA), Part 4 of Article 7 of Chapter 113A of the General Statutes.

(b)       The Department of Environment and Natural Resources may determine the fees for express application review under the express review program. Notwithstanding G.S. 143-215.3D, the maximum permit application fee to be charged under subsection (a) of this section for the express review of a project application requiring all of the permits under subdivisions (1) through (5) of subsection (a) of this section shall not exceed five thousand five hundred dollars ($5,500). Notwithstanding G.S. 143-215.3D, the maximum permit application fee to be charged for the express review of a project application requiring all of the permits under subdivisions (1) through (4) of subsection (a) of this section shall not exceed four thousand five hundred dollars ($4,500). Notwithstanding G.S. 143-215.3D, the maximum permit application fee charged for the express review of a project application for any other combination of permits under subdivisions (1) through (5) of subsection (a) of this section shall not exceed four thousand dollars ($4,000). Express review of a project application involving additional permits or certifications issued by the Department of Environment and Natural Resources other than those under subdivisions (1) through (5) of subsection (a) of this section may be allowed by the Department, and, notwithstanding G.S. 143-215.3D or any other statute or rule that sets a permit fee, the maximum permit application fee charged for the express review of a project application shall not exceed four thousand dollars ($4,000), plus one hundred fifty percent (150%) of the fee that would otherwise apply by statute or rule for that particular permit or certification. Additional fees, not to exceed fifty percent (50%) of the original permit application fee under this section, may be charged for subsequent reviews due to the insufficiency of the permit applications. The Department of Environment and Natural Resources may establish the procedure by which the amount of the fees under this subsection is determined, and the fees and procedures are not rules under G.S. 150B-2(8a) for the express review program under this section.

(c)       No later than March 1 of each year, the Department of Environment and Natural Resources shall report to the Fiscal Research Division and the Environmental Review Commission its findings on the success of the program under this section and any other findings or recommendations, including any legislative proposals that it deems pertinent.

" 143B-279.14.  Express Review Fund.

The Express Review Fund is created as a special nonreverting fund. All fees collected under G.S. 143B-279.13 shall be credited to the Express Review Fund. The Express Review Fund shall be used for the costs of implementing the express review program under G.S. 143B-279.13 and the costs of administering the program, including the salaries and support of the program's staff. If the express review program is abolished, the funds in the Express Review Fund shall be credited to the General Fund."

SECTION 12.2.(b)  The Department of Environment and Natural Resources shall expand to a statewide program that operates in each regional office of the Department the Express Review Pilot Program established by Section 11.4A of S.L. 2003-284 and expanded by Section 12.9 of S.L. 2004-124, and the provisions of G.S. 143B-279.13, as enacted by subsection (a) of this section, shall apply to this statewide program.

SECTION 12.2.(c)  The Department of Environment and Natural Resources shall establish and support 12 additional positions to administer the statewide express review program under G.S. 143B-279.13, as enacted by subsection (a) of this section.  Up to seven hundred thirty-six thousand six hundred twenty-nine dollars ($736,629) for the 2005-2006 fiscal year and up to six hundred seventy-one thousand four hundred nine dollars ($671,409) for the 2006-2007 fiscal year shall be allocated from the Express Review Fund created in G.S. 143B-279.14, as enacted by subsection (a) of this section, to establish and support these 12 positions.

SECTION 12.2.(d)  The Department of Environment and Natural Resources shall continue and support the four positions established under Section 12.9(c) of S.L. 2004-124 to administer the statewide express review program under G.S. 143B-279.13, as enacted by subsection (a) of this section. Up to two hundred twenty-three thousand eight hundred three dollars ($223,803) for the 2005-2006 fiscal year and up to two hundred twenty-three thousand eight hundred three dollars ($223,803) for the 2006-2007 fiscal year shall be allocated from the Express Review Fund created in G.S. 143B-279.14, as enacted by subsection (a) of this section, to continue and support these four positions.

 

Requested by:            Senators Weinstein, Garrou, Dalton, Hagan

Sedimentation Education Funds

SECTION 12.3.  The Department of Environment and Natural Resources shall use the funds appropriated in this act to the Department of Environment and Natural Resources for the 2005-2006 fiscal year and for the 2006-2007 fiscal year for sedimentation education for only the following:

(1)       Sedimentation education activities that provide technical assistance to local erosion and sedimentation control programs under G.S. 113A-60; or

(2)       Sedimentation education to professionals involved in developing erosion and sedimentation control plans for which prior approval is required under Article 4 of Chapter 113A of the General Statutes.

 

Requested by:            Senators Weinstein, Garrou, Dalton, Hagan

Funds to Implement Fishing License Requirements Legislation/Contingent Repeal of Saltwater Fishing License Requirement

SECTION 12.4.(a)  The Wildlife Resources Commission may disburse up to one million dollars ($1,000,000) from the Wildlife Resources Fund to implement Senate Bill 1126 (Amend Fishing License Requirements-2) or House Bill 1092 (Amend Fishing License Requirements) if either bill becomes law no later than 30 days after adjournment of the 2005 Regular Session.

SECTION 12.4.(b)  The State Treasurer shall transfer a sum equal to the sum of funds disbursed pursuant to subsection (a) of this section from the Marine Resources Fund to the Wildlife Resources Fund on July 1, 2010.

SECTION 12.4.(c)  Sections 1 through 4 and Sections 6 through 12 of S.L. 2004-187 and Section 12.16 of S.L. 2004-124 are repealed unless Senate Bill 1126 (Amend Fishing License Requirements-2) or House Bill 1092 (Amend Fishing License Requirements) becomes law no later than 30 days after the adjournment in 2005 of the 2005 Regular Session under a joint resolution.

 

Requested by:            Senators Weinstein, Garrou, Dalton, Hagan

Grassroots Science Program

SECTION 12.5.(a)  Of the funds appropriated in this act to the Department of Environment and Natural Resources for the Grassroots Science Program, the sum of three million one hundred ninety-seven thousand seven hundred sixty-two dollars ($3,197,762) for the 2005-2006 fiscal year is allocated as grants-in-aid for each fiscal year as follows:

                                                                                                                                  2005-2006

 

Aurora Fossil Museum                                                                                      $59,057

Cape Fear Museum                                                                                          $161,007

Carolina Raptor Center                                                                                   $112,174

Catawba Science Center                                                                                  $133,429

Colburn Gem and Mineral Museum, Inc.                                                         $74,545

Discovery Place                                                                                               $662,865

Eastern NC Regional Science Center                                                              $50,000

Elizabeth City Science Center                                                                          $50,000

Fascinate-U                                                                                                         $80,742

Granville County Museum Commission,

Inc.-Harris Gallery                                                                                         $56,422

Greensboro Children's Museum                                                                     $135,076

The Health Adventure Museum of Pack

Place Education, Arts and

Science Center, Inc.                                                                                      $134,499

Highlands Nature Center                                                                                   $79,268

Imagination Station                                                                                            $86,034

Kidsenses                                                                                                            $50,000

Museum of Coastal Carolina                                                                            $74,192

Natural Science Center of Greensboro                                                         $186,354

North Carolina Museum of Life

and Science                                                                                                    $379,826

Rocky Mount Children's Museum                                                                    $72,254

Schiele Museum of Natural History                                                              $229,547

Sci Works Science Center and

Environmental Park of Forsyth County                                                      $146,499

Western North Carolina Nature Center                                                         $112,879

Wilmington Children's Museum                                                                       $71,093

 

Total                                                                                                               $3,197,762

SECTION 12.5.(b)  No later than March 1, 2006, the Department of Environment and Natural Resources shall report to the Fiscal Research Division all of the following information for each museum that receives funds under this section:

(1)       The operating budget for the 2004-2005 fiscal year.

(2)       The operating budget for the 2005-2006 fiscal year.

(3)       The total attendance at the museum during the 2005 calendar year.

 

Requested by:            Senators Weinstein, Garrou, Dalton, Hagan

Moratorium on new lease Purchase Contracts for forestry Equipment for Division of Forest resources

SECTION 12.6.  The Division of Forest Resources of the Department of Environment and Natural Resources shall not enter into any new lease purchase contracts for the purchase of forestry equipment. The Department of Administration shall not enter into any new lease purchase contracts for the purchase of forestry equipment on behalf of the Division of Forest Resources. This section does not apply to existing lease purchase contracts entered into by, or on behalf of, the Division.

 

Requested by:            Senators Weinstein, Garrou, Dalton, Hagan

Extend and Expand Pilot Program for Inspection of Animal Waste Management Systems

SECTION 12.7.(a)  Section 15.4(a) of S.L. 1997-443, as amended by Section 3.1 of S.L. 1999-329, Section 5 of S.L. 2001-254, Section 1.1 of S.L. 2002-176, and Section 6.1 of S.L. 2003-340, reads as rewritten:

"(a)      The Department of Environment and Natural Resources shall develop and implement a pilot program to begin no later than 1 November 1997, and to terminate 1 September 2005, 2007, regarding the annual inspections of animal operations that are subject to a permit under Article 21 of Chapter 143 of the General Statutes. The Department shall select two counties located in a part of the State that has a high concentration of swine farms to participate in this pilot program. In addition, Brunswick County and Pender County shall be added to the program. Notwithstanding G.S. 143-215.10F, the Division of Soil and Water Conservation of the Department of Environment and Natural Resources shall conduct inspections of all animal operations that are subject to a permit under Article 21 of Chapter 143 of the General Statutes in these three four counties at least once a year to determine whether any animal waste management system is causing a violation of water quality standards and whether the system is in compliance with its animal waste management plan or any other condition of the permit. The personnel of the Division of Soil and Water Conservation who are to conduct these inspections in each of these three four counties shall be located in an office in the county in which that person will be conducting inspections. As part of this pilot program, the Department of Environment and Natural Resources shall establish procedures whereby resources within the local Soil and Water Conservation Districts serving the three four counties are used for the quick response to complaints and reported problems previously referred only to the Division of Water Quality of the Department of Environment and Natural Resources."

SECTION 12.7.(b)  Section 3.3 of S.L. 1999-329, as amended by Section 6 of S.L. 2001-254, Section 1.2 of S.L. 2002-176, and Section 6.2 of S.L. 2003-340, reads as rewritten:

"Section 3.3. The Department of Environment and Natural Resources, in consultation with both the Division of Water Quality and the Division of Soil and Water Conservation, shall submit semiannual interim reports no later than 15 April and 15 October of each year beginning 15 October 1999 and shall submit a final report no later than 15 October 2005 to the Environmental Review Commission and toCommission, the Fiscal Research Division.Division, and the Appropriations Subcommittees on Natural and Economic Resources in both the Senate and the House of Representatives. These reports shall indicate whether the pilot program has increased the effectiveness of the annual inspections program or the response to complaints and reported problems, specifically whether the pilot program had resulted in identifying violations earlier, taking corrective actions earlier, increasing compliance with the animal waste management plans and permit conditions, improving the time to respond to discharges, complaints, and reported problems, improving communications between farmers and Department employees, and any other consequences deemed pertinent by the Department. These reports shall also compare the costs of conducting operations reviews and inspections under the pilot program with the costs of conducting operations reviews and inspections pursuant to G.S. 143-215.10D and G.S. 143-215.10F and the resources that would be required to expand the pilot program to all counties. The final report shall include a recommendation as to whether to continue or expand the pilot program under this act. The Environmental Review Commission may recommend to the General Assembly  whether to continue or expand the pilot program under this act and may make any related legislative proposals."

SECTION 12.7.(c)  No later than October 15, 2005, the Department of Environment and Natural Resources shall recommend to the Environmental Review Commission and the General Assembly whether to continue or expand the pilot program under this section. The Environmental Review Commission shall recommend to the 2006 Session of the General Assembly whether to continue or expand the pilot program under this section and may make any related legislative proposals.

 

PART XIII. DEPARTMENT OF COMMERCE

 

Requested by:            Senators Weinstein, Garrou, Dalton, Hagan

WANCHESE SEAFOOD INDUSTRIAL PARK/OREGON INLET FUNDS

SECTION 13.1.(a)  Funds appropriated to the Department of Commerce for the 2004-2005 fiscal year for the Wanchese Seafood Industrial Park that are unexpended and unencumbered as of June 30, 2005, shall not revert to the General Fund on June 30, 2005, but shall remain available to the Department to be expended by the Wanchese Seafood Industrial Park for operations, maintenance, repair, and capital improvements in accordance with Article 23C of Chapter 113 of the General Statutes.

SECTION 13.1.(b)  Funds appropriated to the Department of Commerce for the 2004-2005 fiscal year for the Oregon Inlet Project that are unexpended and unencumbered as of June 30, 2005, shall not revert to the General Fund on June 30, 2005.

SECTION 13.1.(c)  This section becomes effective June 30, 2005.

 

Requested by:            Senators Weinstein, Garrou, Dalton, Hagan

COUNCIL OF GOVERNMENT FUNDS

SECTION 13.2.(a)  Of the funds appropriated in this act to the Department of Commerce, eight hundred thirty-two thousand one hundred fifty dollars ($832,150) for the 2005-2006 fiscal year and eight hundred thirty-two thousand one hundred fifty dollars ($832,150) for the 2006-2007 fiscal year shall only be used as provided by this section.  Each regional council of government or lead regional organization is allocated up to forty-eight thousand nine hundred fifty dollars ($48,950) for the 2005-2006 and the 2006-2007 fiscal years.

SECTION 13.2.(b)  A regional council of government may use funds appropriated by this section only to assist local governments in grant applications, economic development, community development, support of local industrial development activities, and other activities as deemed appropriate by the member governments.

SECTION 13.2.(c)  Funds appropriated by this section shall be paid by electronic transfer in two equal installments, the first no later than September 1, 2005, and the second subsequent to acceptable submission of the annual report due to the Joint Legislative Commission on Governmental Operations and the Fiscal Research Division by January 15, 2006, as specified in subdivision (e)(2) of this section.

SECTION 13.2.(d)  Funds appropriated by this section shall not be used for payment of dues or assessments by the member governments and shall not supplant funds appropriated by the member governments.

SE