Top 5 in ’14: What The Legislature Should Be Doing This Session

The state legislature is back in session this week. The consensus around th e state capital is that this year’s “short session” will live up to its name. But just because legislators won’t be in town for very long doesn’t mean they shouldn’t address some important issues.

Following is a list of priorities the Civitas Institute believes should receive attention this summer:

• Re-Structure Teacher Salary Scale, Reward Results: Gov. McCrory has announced a plan to address teacher salaries, focusing on bringing up the average salaries of starting teachers, providing pay increases for all teachers, and creating targeted financial incentives. Such incentives are focused on rewarding teachers who teach “high demand” subjects, earn a master’s degree in the subject they are teaching and become more involved in leadership roles at their school. McCrory’s plan pushes discretion for these incentives to the local level, which is a step in the right direction. The governor’s plan fails, however, to tie salaries and bonuses to performance and results. The focus remains on inputs rather than rewarding more positive outcomes.

Re-structuring the teacher salary scale to reward student achievement measures must be part of the solution.

• Stop Common Core: State lawmakers should follow the recommendations of the Legislative Research Committee on Common Core standards. The Committee’s report recommended legislation that would effectively remove Common Core standards from North Carolina’s public schools. Legislation recommends the creation of a new commission to evaluate the English and math Common Core standards, with an eye toward improving, eliminating and/or replacing them. The new commission would complete its evaluations by the end of 2015.

Civitas supports the elimination of the federally-supported Common Core standards and their replacement with state-based, high quality standards.

• Reform Medicaid: North Carolina needs to reform its Medicaid program, which is growing at an unsustainable pace, crowding out other priorities from the state budget. Gov. McCrory has proposed a reform relying on Accountable Care Organizations, a proposition with several flaws that would at best generate very limited savings.

Civitas instead would rather see North Carolina enact a more sweeping “managed care” type reform – similar to the reform seeing success in Florida. State lawmakers also need to address long-term care (LTC) eligibility in Medicaid, as LTC is a main driver in the growth of Medicaid expenses.

• Fight Extension of Tax Breaks for Film Production: North Carolina’s state tax code includes significant breaks for TV and movie production companies filming here in NC. These tax credits are scheduled to expire at the end of this year. But there is substantial support, especially from lawmakers in areas like Wilmington that benefit from the tax breaks, to renew the credits. 

Civitas opposes crony capitalism that provides preferential treatment for targeted industries and wants to see these credits expire.

• Reduce North Carolina’s Dependency on Federal Funds: North Carolina’s reliance on federal funds has been growing at a dramatic pace. Of the total state budget (which includes the General Fund, transportation, federal receipts, etc.), North Carolina has relied on federal funds for roughly 45 percent of its total expenditures over the last decade. Given the huge national debt, massive unfunded liabilities and recurring budget crises, relying on the federal government for continued support is highly risky. The risks of more federal government sequestrations or across-the-board cuts in state support are very real threats to North Carolina’s state budget. Moreover, federal funds always come with strings attached, many of which require state funds to comply with onerous regulations.

State lawmakers should pass legislation that would thoroughly conduct an agency-by-agency inventory of federal funds the state receives, the strings attached, and the costs imposed by these strings. The bill would also require a contingency plan of how the state could weather a significant cutback in federal support in the event of a future federal government crisis, as well as develop a long-term plan to reduce North Carolina’s reliance on federal funds.