Cowell says proposed state budget jeopardizes benefits for disabled officers

lbonner@newsobserver.com June 14, 2013 

State Treasurer Janet Cowell opposes a budget provision she says will jeopardize insurance benefits for disabled law enforcement officers and officers’ survivors.

Both House and Senate versions of the budget include a provision that would take about $10.9 million from the Separate Insurance Benefit Trust next year, and more in the following year, to pay State Health Plan premiums for officers who work for the state Justice and Public Safety departments. The trust has $84.4 million in assets, according to Cowell’s office. If legislators keep taking money out, the trust will no longer be self-sustaining in three years and won’t be able to pay benefits in seven years. The trust receives no money from the state budget, Cowell wrote, but if legislators keep dipping into the account the trust will need ongoing state appropriations in the future.

The trust pays benefits to disabled state and local law enforcement officers and death benefits to their survivors.

The $10.9 million legislators want to take from the trust for health insurance premiums would ordinarily come from state coffers.

“I question the fairness of using money accumulated to benefit both state and local law enforcement officers to only supplement the benefits provided to state officers,” Cowell, a Democrat, wrote in a Wednesday letter to House and Senate budget writers. She asked for the provision to be removed.

The House passed its $20.6 billion budget proposal Thursday. The Senate approved a budget of similar size in May. House and Senate negotiators will likely start working out the spending and policy differences next week. The new budget year starts July 1.

Sen. Pete Brunstetter, a Winston-Salem Republican and a lead budget writer, said there’s no plan to tap the trust after 2015, and it will have more than enough money to pay beneficiaries until then.

“The fund has something like 80 times the amount of disbursements required,” he said. He added that it’s not unusual to have money from special funds go to pay expenses.

Law enforcement wants to be sure that the fund has enough money in it, said Eddie Caldwell, N.C. Sheriffs’ Association executive vice president. The group is relying on Cowell’s analysis on the fund’s solvency, Caldwell said, but won’t adopt a position until it gets more information from her. Even though legislators haven’t talked about diverting money from the trust after 2015, there’s no telling what lawmakers will do two years from now, he said.

Cowell criticized what her letter called “a larger pattern of withdrawing resources from self-sustaining revenue sources.”

For years, Cowell has objected to budget writers tapping the unclaimed property fund for purposes other than scholarships for needy students. The state constitution requires money from the fund go to aid students attending community colleges and public universities.

Bonner: 919-829-4821

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