Thanks Governor

Over the past few weeks State Government has been dogged by a number of huge issues facing the state. Not the least of these are an estimated 3 Billion plus budget shortfall over the 09-11 fiscal years and a State Health Plan in crisis.

Through it all, Governor Bev Perdue has worked hard to protect working families, even while others push her in the wrong direction.

This all started in earnest a few short weeks ago back in January with a pronouncement that the State Health Plan needed an immediate cash infusion. This was met with some real action by the legislature, not too surprising considering that 1 out of 11 people in the state who have health insurance have it through the state health plan.

The first reports had legislative leaders and Jack Walker (the Plan administrator) calling for premium increases on State Employees. The Governor very quickly came out and said that she would veto any bill that made State Employees pay for their own coverage. Why? Because she knows that despite the claims of conservatives, state employees are paid well below the market average. She also knows that the plan's biggest problem is that it does not have enough young members and a premium increase would drive even more health employees out of the system.

After a few weeks of what I can only assume was intense lobbying by Blue Cross and Blue Shield, Rep Holliman and Sen Rand released a plan that was then introduced by Senator Rand as Senate Bill 287. He pushed this bill hard, and it went through 2 committees he controls with an iron fist before getting held up. It has been on the Senate calendar twice before getting pulled, and is supposed to come up again tomorrow. Its hard to concisely wrap up such a complicated bill, but the claim by Rand is that this bill absolutely must be passed by the end of the month or it will cost us even more money and the State Health Plan won't be able to pay its doctor and hospital bills.

What did the Governor do in the face of such plans? She seized the Rainy Day Fund, and said that she would make sure the $250 million needed immediately was provided.

Of course she came under fire for stepping on the toes of legislators, but she took a necessary step to allow the full legislative process to play out instead of seeing a horrible plan get pushed through as quickly as possible. And this really is a horrible plan from Senator Rand. It would cost the average state employee hundreds, if not thousands of dollars per year. This plan would institute the use of "smokalyzers", special machines that would allow the state to randomly test every state employee and their dependents for nicotine. I don't have the time or space to explain everything, heck, its given Policy Watch over a months worth of posts (that you should read).

But then things got worse for State Employees as the budget fight hit a new level. Earlier this week the Governor released her proposal, which cut state spending by a pretty big chunk. She did a number of things to allow for these cuts to be as small as possible, including using 1.7 billion in stimulus funds. The best story on the budget has been Laura Leslie's 5 minute rundown for WUNC.

If you listen to Laura's report you hear reference of the cuts that the Governor made. These cuts included permanently cutting 1400 positions from State Government, many of which were already vacant, and many of which will be reduced by allowing Correctional workers to transfer to a new facility once 7 prisons are closed.

But within these cuts she managed to do some pretty remarkable things. She is attempting to increase the rate of the Earned Income Tax Rate. She is lowering taxes on small businesses with profits below $25,000. She is preserving as many services as she can that help the citizens of this state, and making significant policy changes such as expanding and fixing the probation/parole system.

Most important for me, at a time when the President is spending every ounce of political capital he has to save jobs, she avoided deep cuts to State Employees. Although State Employees will feel some significant pain from the loss of longevity pay for 2 years, she is laying off less than 300 total workers, and made a significant effort to avoid layoffs. What was the response?

Senator Marc Basnight said she should fire a few hundred employees more at the Department of Public Instruction. Speaker Hackney said that he was disappointed she didnt lay off more people. Rep Holliman said that firing state employees would make sure they felt equal pain to the rest of the state, and if he couldn't have that, he let the papers know he would be pushing for furloughs. What are fuloughs? They are mandatory, unpaid leave days, where every state employee gets sent home without cash.

The Governor has so far stood her ground, in standing up for State Employees. She has stood behind people who on average make more than 5% below the market average. She has stood behind people whose employer (our state government) ranks in the bottom 10 for benefits for both employees and dependents.

But what is next? What is going to happen when the budget goes to the Senate and the same folks who told us that saving the rich money was more important than cutting the regressive sales tax get their hands on her plan? Is Hackney really going to tell us that to create jobs he is going to fire state employees? Call your legislators, and let them know, "The Governor has it right."

Full Disclosure, I have been working the past few weeks with the State Employees Association of North Carolina (SEANC, SEIU Local 2008) as an intern learning the ins and outs of Worksite Organizing. As most of you know I have a lot of campaign experience and know how to organize workers, but worksite organizing is its own beast, and I have been working hard learning what State Employees here in the state face every day.


Didn't include

I didn't include the thoughts of the State Republican Legislators because their hatred of all people who work for a living (I'm looking at you Skip Stam and Phil Berger) has made them persona non grata for me.

"Keep the Faith"

Is BCBS still exempt from paying taxes?

I remember a while back that BCBS had a non-profit status. I haven't kept up with it in a while, but are they paying taxes to NC now?


I'm not sure about all the conversion details, but BCBS made 186 million dollars in profits last year, and their website claims they had a tax bill of 173.8 million in 2007.

"Keep the Faith"

Thanks for the run down, Will.

I heard those comments from Basnight and Hackney and my first thought was, "Well, if other States were jumping off bridges, would you think it a good idea to do the same?"

I just don't think it's too bright to lay off a slew of state employees in the midst of high unemployment if there is any way it can possibly be avoided. To use the downturn as an excuse to clean out a few agencies one personally does not like is a little short sighted. It cuts revenue collection (taxes) and increases costs (unemployment ins. and other aid) in its own way. AND ... it throws another group of people out there to compete for the slim pickin's of jobs there are.

I especially liked Perdue's tax relief for small businesses making $25,000 or less. She instinctively knows that when people are out of work and can't find new work, starting their own business doing anything they can is how many cope to keep the lights on, the car payment made and food on the table. Good move. Good policy.

"They took all the trees and put them in a tree museum Then they charged the people a dollar 'n a half just to see 'em. Don't it always seem to go that you don't know what you've got till it's gone? They paved paradise and put up a parking lot."


Glad you agree, and I appreciate you filling in the why for some of my points. It gets hard to put everything in there that needs to be.

"Keep the Faith"

It Continues

Under the Dome reported that the Governor was taking out a half million dollars for a UNC program that is able to self fund because of an endowment the state has been setting up. The directors of said program pretty much said ok, because they will still be able to operate without a problem.

The response from the legislature? Republican Richard Stevens and Democrat Linda Garrou are sponsoring a bill to restore the funding. Way to waste taxpayer money folks.

"Keep the Faith"