NCAE Defies Law; What’s Next?

Now that the North Carolina Association of Educators (NCAE) has defied an audit mandated by state law, what happens next?

We at the Civitas Institute and the Center for Law and Freedom (CLF) have written extensively and asked questions about the Office of the State Auditor’s statutorily-mandated “dues checkoff” audit. This investigation requires the auditor to certify the membership numbers of the NCAE and other groups that benefit from state-provided dues deduction privileges. Put briefly, local school districts and other state entities withhold membership dues from certain state employees association members’ paychecks, saving the these groups time and money at the taxpayers’ expense. But in the case of the NCAE, this withholding is only legal if the teachers’ group maintains a membership level of 40,000 or more. For some time, State Auditor Beth Wood has been performing her investigation, and at long last her full report has been issued.

The verdict? The NCAE refused to comply with the auditor’s investigation. From page 3 of the report:

We were unable to obtain the total membership count and type of membership count from the North Carolina Association of Educators (NCAE). After numerous requests, the NCAE refused to furnish the information. We do not have the authority to compel NCAE to turn over this information because, as a private entity, NCAE does not fall under the authority of the State Auditor. However, NCAE reported a total membership count of approximately 70,000 on their website as of October 27, 2015. We were not able to confirm this membership count.

Here is a screenshot of the auditor’s compilation of data on employees’ association membership numbers:

There are three important takeaways:

First and foremost, any withholding of dues for the NCAE must cease immediately. The organization benefits from the expenditure of state resources, yet at the same time refused to comply with the auditor’s certification of their numbers. The labor organization cannot be allowed to take advantage of the government’s helping it collect dues, but then claim that as a private entity it is under no responsibility to comply with statute.

Second, there can now be no realistic doubt that the NCAE’s membership level is below 40,000. As Dr. Bob Luebke has written, it has for some time been likely that the organization is below the threshold to receive the checkoff benefit. The group’s refusal to comply with the auditor’s request makes it obvious that it is below the threshold, for otherwise the group surely would be eager to comply. The group is certainly nowhere near the 70,000-member level reported on its website.

Third, the legislature must enact a better system of overseeing state-provided dues checkoff benefits. The NCAE refused Woods’s requests based on the fact that she does not have the statutory authority to subpoena documents from private entities. Either language needs to be added making the dues checkoff benefit conditional on complying with state auditor investigations, or the state should move towards a contractual system in which organizations negotiate with the state for dues checkoff benefits rather than receive them via statutory grant.

And finally, and most importantly we should ask a more fundamental question – why is government in the business of withholding dues for private organizations in the first place? It’s a question that lacks a compelling response. Perhaps instead of enacting better accountability for dues checkoff benefits, the legislature will do the right thing next session, and eliminate withholding dues altogether.