Politics & Government

What to look for in the state budget as the House and Senate negotiate

NC Senate majority leader talks about budget negotiations

Senate Majority Leader Harry Brown, who cosigned a letter to Gov. Roy Cooper claiming that Cooper did not want to negotiate the budget without Medicaid expansion, speaks to reporters on the budget negotiations.
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Senate Majority Leader Harry Brown, who cosigned a letter to Gov. Roy Cooper claiming that Cooper did not want to negotiate the budget without Medicaid expansion, speaks to reporters on the budget negotiations.

State Republican leaders don’t want to expand Medicaid, but Democratic Gov. Roy Cooper wants it to be part of budget discussions as the legislature hashes out the next version of the state budget this week.

Also on the table in negotiations are how much of a raise teachers and other state employees will get, whether the Department of Health and Human Services headquarters will leave Raleigh and the future of a Greenville hospital.

Neither the House nor Senate budget proposals included Medicaid expansion, though Cooper said the expansion is a priority.

On Tuesday, three Republican senators sent a letter to Cooper and gave reporters a copy, saying Cooper did not want to negotiate the budget without Medicaid expansion.

Cooper spokesman Ford Porter said in an email to The News & Observer that “it should be no surprise that the governor is pushing for Medicaid expansion in budget negotiations, which we expect to continue.”

“Instead of trading letters through the press like a political TV drama, we hope Republicans will engage in a meaningful conversation with the governor,” Porter said.

Cooper’s staff was clear that Medicaid expansion needs to be part of the discussions and has invited legislative leaders to the Executive Mansion on Wednesday to continue negotiations.

Senate Majority Leader Harry Brown, who signed the letter to Cooper along with Sen. Kathy Harrington and Sen. Brent Jackson, spoke with reporters on Tuesday about the letter and budget negotiations.

“If [Cooper’s] willing to not just have a show, but really sit down and negotiate, we’d love to sit down with him,” Brown said Tuesday. Brown said that Medicaid has problems and expansion “just doesn’t make sense to a lot of us.”

The revised budget is expected to come out within a week, but it would face a possible veto if it doesn’t satisfy Cooper — and it would then need the support of supermajorities in the House and Senate to become law.

Possible DHHS move from Raleigh

The House and Senate budget proposals, both created by Republican leaders, don’t differ too much. Both include raises for teachers and other state employees, but by different amounts.

However, the Senate budget includes a plan to move the DHHS headquarters from Dix Park in Raleigh to Granville County.

The Senate budget proposed $250 million to build a new administrative facility in Granville County for DHHS employees currently working at the Dix location.

In May, Sen. Ralph Hise, a Spruce Pine Republican, told The News & Observer that senators had not designated exactly where the relocated DHHS offices would be, but he said they are looking at state-owned land in Butner as well as 527 acres that Granville County proposes to donate in a business park for the project.

Granville County Manager Michael Felts said at the time that officials were excited by the prospect of the project being in Granville County and that it would be “transformative.”

However, current DHHS employees’ commutes could be a lot longer if the move happens. Senate Democratic Whip Jay Chaudhuri, whose district includes the Dix property, said in an interview earlier this month that a longer commute for Wake County residents would “create a lot of hardship,” including for those needing time to pick up children from child care. He said he’s heard from DHHS and DMV employees who would consider leaving their jobs because of the relocations.

“I think it raises real concerns about whether state government can be effective when we’re engaged in transferring state agencies without any planning,” Chaudhuri said.

Brown said Tuesday lawmakers are still discussing DHHS’ potential relocation, and where.

“I think we’ll give some flexibility on where that could be located,” he said.

Teacher pay, state employee raises

In the Senate budget, the average teacher raise would be 3.5% over two years. In the House, teachers would get an average raise of 4.6%, but the pay scale wouldn’t change until Jan. 1, unlike in the Senate budget, which would start with the fiscal year on July 1. Both budgets proposed 1% raises for education support staff like custodians, instructional assistants and cafeteria workers, though the House proposed 1% or $500, whichever is higher.

For other state employees, the Senate was more generous with its proposed raises, averaging 5% for most state employees over two years. In the House budget, it was just 1%.

Republican senators Harry Brown and Brent Jackson read and explained their budget proposals to the media at the General Assembly on Tuesday, May 28, 2019. The House and Senate are calling for different raises for teachers and other state employees.

Brown told reporters Tuesday that the budget being negotiated now would include a raise for teachers but stopped short of saying how much of one.

“We also think it’s important to take care of the other state employees in this budget, and I think the House is agreeing with us most of the way on that, so we’ll see how that plays out,” Brown said.

Greenville hospital

Also in the Senate budget, but not in the House, was a $35 million cut to Medicaid reimbursements for a Greenville hospital and removing its status as a teaching hospital, the N&O previously reported. Vidant Medical Center recently sought to remove the UNC Board of Governors’ ability to appoint hospital trustees. Sen. Don Davis, a Democrat who represents that area, said that Eastern North Carolina was under attack in the budget.

Brown said Tuesday that budget negotiations were happening that day about Vidant as well.

Staff writer Paul A. Specht contributed to this story.
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Dawn Baumgartner Vaughan covers North Carolina state government and politics at The News & Observer. She previously covered Durham for 13 years, and has received six North Carolina Press Association awards, including a 2018 award for investigative reporting.