NC budget provisions take new import with Medicaid expansion

RALEIGH, N.C. — North Carolina state government budgets usually include policy directives that give any governor heartburn.

This year should be no exception, as the budget proposal from House Republicans unveiled this week that would spend almost $30 billion next fiscal year and almost $31 billion the following year contained several items that Democratic Gov. Roy Cooper, his administration or his allies will dislike.

Since taking office in 2017, Cooper has vetoed final spending plans that the Republican-controlled General Assembly has sent him, with mixed results. More recently he’s signed budget bills, saying the good inside outweighed the bad.

But Cooper’s calculus surely will be challenged this year because of what’s contained in a bill that he signed to great fanfare on Monday, intended to expand Medicaid to hundreds of thousands of low-income adults.

The measure requires that a state budget law must be enacted for the coming year before the formal acceptance and implementation of expansion, which has been among Cooper’s top legislative priorities for years. While unlikely, the language could scuttle Medicaid expansion if no budget could be approved.

The House budget-writing committee considered dozens of amendments Thursday on the way to expected floor votes for the full package next week. It contains policy provisions restricting Cooper or his administration on environmental policy, oversight of the State Bureau of Investigation and election administration.

“The provisions that we put in there are things that we believe are important to good government in North Carolina,” House Speaker Tim Moore told reporters during a committee break. “These provisions, we think, are common sense.” Other GOP-favored policy language addresses the online disclosure of public school instructional materials.

The necessity of a budget for expansion to occur means the governor may be less willing to veto a measure. That’s on top of his waning leverage in negotiations because Republicans gained enough seats in the November elections to get just a House seat away from holding veto-proof majorities in both chambers.

Still, Cooper sounded cautiously optimistic at the expansion bill signing ceremony about getting a final budget he can live with.

“The budget is going to be a complicated process anyway, and I feel confident that we can work together to get something that we can agree on,” Cooper said. “Obviously, I have signed budgets and I’ve vetoed budgets, and we’ll see how this one works.”

More such special provisions are expected from the Senate when Republicans in the chamber approve a competing plan later this spring. The two chambers are then likely to hammer out differences and send the compromise to Cooper.

On clean energy, language in the House proposal would prohibit Cooper and his administration from entering into an agreement with other states to obligate utilities to purchase allowances to release pollution as a way to reduce carbon dioxide emissions.

And the measure also would block state government from setting standards related to new vehicles sales that would mandate sales or purchases of “zero-emission vehicles.”

Cooper signed an executive order last fall telling state environmental regulators to propose a “clean trucks” program that would require van, bus and commercial truck manufacturers to sell more zero-emission vehicles in the state.

And the Environmental Management Commission — for which the governor appoints a majority of members — agreed in 2021 to develop rules that would lead the state to join a 12-state Regional Greenhouse Gas Initiative that involves a “cap-and-trade” program for CO2 emissions. Rulemaking is still happening, the Division of Air Quality said Thursday.

Rep. Dean Arp, a Union County Republican, said that the state should focus on carrying out a landmark 2021 law that directs the state’s electric public utilities to reduce C02 emissions by 70% by 2030 as compared to 2005 levels.

With the other initiatives, Arp said, “the state is going down a failed energy policy that raises rates and reduces reliability.”

Other bill language would turn the State Bureau of Investigation into a standalone department that would no longer be housed in the Department of Public Safety, which is a Cabinet agency.

State law already gives the SBI a level of independence, but it still reports directly to the governor. The director is nominated by the governor but is subject to General Assembly confirmation.

Current SBI Director Bob Schurmeier told a House committee this week that Cooper’s office attempted to interfere in his hiring decisions and sought his removal. House Republicans say that’s proof more independence is needed.

“We don’t need either the perception or the reality of a law enforcement agency being weaponized or being politicized,” Moore said.

Cooper’s office didn’t immediately respond Thursday to an email requesting comment on these and other House budget provisions.

But a Cooper spokesperson told WRAL-TV earlier this week that the governor’s office “has expressed concerns to Director Schurmeier about his leadership and the culture and practices at the SBI” and believes an outside review is needed.

(WATCH BELOW: NC approves Medicaid expansion, reversing long opposition)

NC approves Medicaid expansion, reversing long opposition

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