November 2000

FOR MEMBERS ONLY
 This is the fax and printout version of the monthly newsletter, with no pictures or graphics.

Judge Rules Constitution Requires State to Offer
Additional Educational Services to At-Risk 4-Year-Olds

In an important ruling in the long-running Leandro case, Superior Court Judge Howard Manning ruled Oct. 26 that the state has a constitutional obligation to provide pre-kindergarten education for at-risk 4-year-olds, a finding that has major implications for the state budget. The judge seemed to imply that the state, in order to properly serve the needs of these children, would have to make Smart Start (or something like it) a fully-functioning part of the K-12 public school system.

"North Carolina lacks sufficient quality pre-kindergarten educational programs to meet the needs of its at-risk children,” Judge Manning wrote in the 43-page ruling. “As a result, these at-risk children . . . are being denied their fundamental constitutional right to receive the equal opportunity to a sound basic education." After making that basic conclusion on the constitutional issues, Manning left the decision on how to expand those programs up to the governor and the General Assembly but said they should act "at a reasoned and deliberate pace."

Judge Manning said that at-risk children, because they are not receiving the proper intervention services, usually fail in school, drop out and turn to crime. “One end result for many of these at-risk children is the criminal justice system – a system that is a gateway to prison rather than a gateway to being a productive member of society. Most have at least one, if not more, illegitimate children. These children are born into an environment in which education is a little-valued commodity. Until and unless this vicious cycle is broken by education and better opportunity for this segment of the at-risk population and for the other at-risk children who are not passing through the criminal justice system, there will not be an equal educational opportunity for every child in North Carolina.”

Judge Manning added that “the bottom line is simple. The court, based on the clear and convincing evidence, finds that at-risk children should be provided the opportunity to attend a quality pre-kindergarten educational based program that has, as its goal, the preparation of at-risk children for kindergarten.”

He concluded that “the court, based on clear and convincing evidence, finds and concludes as a matter of law that under the North Carolina Constitution as interpreted by Leandro, the right of each child to an equal opportunity to receive a sound basic education in the public schools is not to be conditioned upon age, but rather upon the need of the particular child, including, if necessary, the equal opportunity of an at-risk child to receive early childhood pre-kindergarten education prior to reached the age of 5 and prior to entering 5-year-old kindergarten.”

Officials estimate that anywhere from 10,000 to 40,000 children across the state fall into the category of at-risk 4-year-olds. Nobody knows how much it would cost the state to extend specialized educational services to them, but a similar program in Charlotte spends $10.1 million a year to serve 1,800 low-income 4-year-olds, or about $5,600 per child.

Manning pointed out that Smart Start, Gov. Jim Hunt's early-childhood program, is run by a non-profit group, not by the state and "is not principally a pre-kindergarten education program."

Manning said plainly, however, that his ruling “does not require the State of North Carolina to provide every 4-year-old child with a pre-kindergarten program at state expense. A universal 4-year-old pre-kindergarten program is not required to meet the sound basic education standard of Leandro because, fortunately, the majority of 4-year-olds are not at-risk and are able to enter kindergarten at age 5 ready to learn.”

This was the second of what are expected to be three separate rulings by Judge Manning in the Leandro case. In the first ruling, Manning issued an opinion as to what the state constitution means when it says all children are entitled to an equal education.  The third one is expected to deal with issues of equity in school funding.

Phil Kirk, chairman of the State Board of Education who also is president of NCCBI, said "the state board will be very supportive of trying to implement the judge's ruling. All the evidence that we're aware of would support his contention."

Good times, good food and great speakers
You can see on their faces that NCCBI members like getting together for the fall membership meetings. Twenty have been held so far, with two more stops on the tour Nov. 6 in Fayetteville and Wilmington. The audiences have listened attentively as university chancellors and community college presidents explained how money from the $3.1 billion in bonds will be spent to improve their campuses. Many speakers have told stories of shockingly bad facilities on their campuses, particularly in science labs and basic infrastructure. The educators knew down to the penny how much they will have available to spend, if the bond issue passes, and obviously had given a lot of thought to identifying priorities.

UNC-Greensboro Chancellor Pat Sullivan, a member of the NCCBI Executive Committee, pointed out that the seats in Aycock Auditorium on her campus, which recently hosted a tribute to John Phillips Sousa, are the same ones the audience sat in when Sousa himself played there.

Attendance so far has been a little more than usual at most stops on the 22-city tour, in part because of all the office-seekers attending, and because many members – as they were asked to do – have brought prospective members as their guests.

Chairman Mac Everett of First Union in Charlotte has proven to be an effective and enthusiastic speaker at the regional membership meetings. He seems genuinely pleased to report that NCCBI is in great shape and is rapidly growing in numbers. Everett bragged on the hard work of Second Vice Chairman Jim Hyler of Raleigh, the First Union Bank executive, in this year’s annual membership campaign, which to date has brought in 383 new members, raising membership to more than 2,200. That’s the best campaign ever, with nearly half the year to go, Everett stressed in his remarks, evidence that NCCBI “is a very dynamic organization.”

NCCBI has never before been as strong, in numbers and clout, Everett has said in noting that President Phil Kirk and Vice President of Governmental Affairs Leslie Bevacqua now rank in the top eight of more than 800 lobbyists in Raleigh.

Everett also has been a gracious host in welcoming the many candidates for statewide office who have attended the meetings as guests. He explained that NCCBI doesn’t endorse candidates but does encourage business people to get to know the candidates so we can make intelligent choices in the voting booth.

President Phil Kirk is using his remarks to update members on political events in Raleigh. The association’s seven policy committees are meeting regularly this fall and winter to develop positions on emerging legislation that may come up when the General Assembly reconvenes, Kirk said. Talking about the education bonds, Kirk said NCCBI members had contributed $3.7 million toward the cost of the campaign so far, with more pledged toward the goal set by the NCCBI-led North Carolinians for Educational Opportunity (NCFEO). Radio and television ads sponsored by NCFEO have begun airing, Kirk said. This is the fourth statewide bond campaign NCCBI has worked to pass in the past 10 years.

Kirk said polling data suggest that most voters look favorably on the bonds and planned to for vote for them, but he said NCCBI isn’t taking any chances and is running the campaign as if we’re 20 points behind.

Pictures from the remaining meetings will be in next month's online newsletter.

State Government News
North Carolina had one of the nation's fastest-growing populations during the 1990s, as the number of state residents grew nearly 15 percent to more than 7.6 million people. But the number of state employees grew even faster -- by more than 22 percent, according to a recent report by State Treasurer Harlan Boyles.

The 256,856 people drawing paychecks from the state at the end of 1999 breaks down this way:  76,767 work for state agencies of all types, except in education;  73,739 are classroom teachers; 61,909 work for the public schools in non-teaching jobs; 32,029 work for the university system; and 12,412 work for the community colleges.

Since 1974, the state's population has swelled 33.2 percent while the number of state employees has ballooned 70.5 percent, according to Treasurer Boyles' numbers.

September Tax Collections Weak
September usually is a pretty good month for the tax man. Back to school shopping, end of summer vacations and end of quarter spending usually keeps the state's cash register ringing. Not so this year. Total monthly collections are 11% below budget, led by a sales tax collections 14% less than expected. At the end of the first quarter, the budget is right on the nose.

EMC Adopts Plan Requiring 68% Cut in Power-Plant Emissions
The Environmental Management Commission voted 9-5 on Oct. 12 to adopt a Hunt Administration compromise to reduce nitrogen oxide emissions from coal-fired power plants by 68 percent by 2006. The cost of meeting the new rules was estimated at $350 million for Duke Power and $327 million for CP&L. Environmental groups, which sought an 80 percent reduction, expressed disappointment. Supporters of the plan said pollutants would be significantly reduced and the two companies agreed not to challenge the rules in court. "These rules are a major step forward in carrying out Gov. Hunt's clean air plan for substantially improving air quality, protecting public health and sustaining our economy," DENR Secretary Bill Holman said. The commission had to meet an Oct. 31 federal deadline. North Carolina is one of 22 states under an EPA orders to cut emissions, but that order has been challenged. A contingency plan adopted by the commission guarantees a minimum 56 percent reduction if the federal order is blocked.

German blimp maker lands near the coast
CargoLifter Inc., a Garman company, announced last month that it will locate an airship assembly and maintenance facility on a 4,000-acre tract just off Highway 70 a few miles east of New Bern at Cove City. The plant will require up to $120 million in initial investment and create 200-300 new jobs.

"Just a few months ago, I had the opportunity to see the facility CargoLifter is building in Germany, and I was impressed by the sheer magnitude of the facility and the project," Gov. Jim Hunt said Oct. 12 at the announcement ceremony. "That is why it is especially gratifying to know that the company chose North Carolina to house their North American operations, and I welcome their presence and future investment in our state and in our workers."

CargoLifter will manufacture airships measuring over 850 feet in length capable of carrying payloads of up to 160 metric tons at the facility. Utilizing an on-board crane system which allows the craft to load without landing, the airships will be able to transport heavy or outsize cargo anywhere in the world all in one piece. The ships will travel at a speed of 50-60 mph at an altitude of about 6,000 feet.

The hangar itself will be approximately 30 stories high and the length of four football fields, and will be able to house two airships during manufacturing and maintenance. In addition to the hangar, the 5,800-acre CargoLifter "campus" will house repair and maintenance facilities, administrative offices and a visitor center.

CargoLifter is the North American subsidiary of German-based CargoLifter AG, which is developing a global transportation network using giant airships to transport heavy cargo. The company projects the CargoLifter hangar to be completed in North Carolina in 4-5 years and the first CargoLifter airship in about 5-6 years. Construction of the first CargoLifter CL160 airship in Germany should begin in 2001. Serial production of approximately 50 airships is planned to start in 2004.

CargoLifter will be eligible to receive tax credits under the William S. Lee Quality Jobs and Expansion Act for investment, job creation, and worker training.

German Chemicals Maker Chooses Charlotte: Alberdingk Boley, based in Krefeld, Germany, announced last month that it will locate a $20 million production facility in the Charlotte area that will make environmentally safe chemical binders such as coatings and resins for industrial uses. It will be Alberdingk Boley's first US production facility.

Alberdingk Boley plans to begin production in the new facility by 2002 and expects to hire at least 50 employees. The company selected North Carolina because of its central location in the growing market for acrylate and polyurethane products that substitute solvent-based coatings with water-based technology. Also, Krefeld and Charlotte are sister cities.

Alberdingk Bolay will be eligible to receive investment, job creation and worker training tax credits under the William S. Lee Quality Jobs and Business Expansion Act.

North Carolina is home to more than 160 German-owned companies.

Nashville Breaks Ground on New Business Center
The Town of Nashville has broken ground on a 53,000-square-foot spec building at the Nashville Business Center. Funding for the building comes from the Town of Nashville, Nash County, CP&L and the Nash County Business Development Authority. Expected to be completed by June 1, 2001, the spec building doesn't yet have a tenant. It will be marketed by the Carolinas Gateway Partnership.

Meanwhile, Eagle Assembly Unlimited Inc. announced it will begin operations in Nash County by occupying an existing 17,000-square-foot facility where it will produce register and rotor assemblies for electric power meters. Eagle Assembly will invest up to $5 million in machinery and plant upgrades and hire 60 people, according to Thomas A. Betts Jr., chairman of the Carolinas Gateway Partnership, which assisted in the deal.

Wachovia Tops in SBA Loans
Wachovia Bank is this year's top small business lender in North Carolina, according to the state office of the Small Business Administration. During the year ended Sept. 30, Wachovia made 53 SBA guaranty loans totaling $6.1 million, according to SBA North Carolina District Director Lee Cornelison.

"Wachovia is very proud of having reached No. 1 ranking in North Carolina," said Mike O'Callaghan, vice president and manager of special loan programs at Wachovia. "This achievement is the direct result of our focused efforts and a longstanding relationship with the SBA."

Bank of America and Centura Bank tired for second in SBA loans (see chart at right). In terms of total SBA guaranty dollars, CIT Small Business Lending Corp. came out on top at $19.3 million in loans.

During the past fiscal year, 641 small business loans worth more than $172 million were guaranteed by the SBA's state office.

The top producing LOWDOC lender in North Carolina was BB&T with 21 such loans, the SBA said.

Seminars Explain School Promotion Standards
The North Carolina Business Committee for Education, with the assistance of local school personnel, is offering interactive seminars to businesses interested in learning more about North Carolina public schools' new promotion standards. Participants will learn about state and local requirements, hear suggestions for parent support, and receive answers to their questions about the new standards. Six of the state's largest employers already have held 16 workplace seminars reaching about 500 employees.

New standards, also called gateways, have been adopted by the State Board of Education to ensure that students are performing on grade levels (grades 3-5-8) in reading, writing and math before being promoted to the next grade. For high school graduation, students will need a passing score on an exit exam of essential skills and a computer skills test in order to receive a diploma. During the 2000-01 school year, the new state standards are being implemented for fifth grade students. Parents and the community need to clearly understand the new requirement so they can provide valuable support for students to ensure they reach their maximum potential.

State businesses and local chambers of commerce are encouraged to contact the N.C. Business Committee for Education at 919-715-3535 or by e-mail at bwhittington@gov.state.nc.us to make arrangements for a seminar for your employees and/or members.

National Names in the News
W.R. "Tim" Timken Jr., chairman and CEO of The Timken Co., has been elected chairman of the National Association of Manufacturers. NCCBI is the state affiliate of NAM, and Timken Co. has a branch in Randleman, N.C., that is a member of NCCBI. Timken said he will urge manufacturers and their employees to get more involved in the political process.

"We manufacturers don’t deny there’s a new economy; we just deny there’s still an old one. There is a new economy and there’s a new manufacturing that is very much a part of it," Timken said. "We wouldn’t be talking about a new economy at all – with its durably high growth and low inflation – if it weren’t for the new manufacturing’s products, processes, people, and productivity. Walk through our plants; you’ll see high technology in action."

Timken, who succeeds James H. Keyes of Johnson Controls, will serve a one-year term as chief spokesperson and leader of the nation’s largest and oldest industrial trade group, founded in 1895. The NAM – 18 million people who make things in America -- represents 14,000 member companies (including 10,000 small and mid-sized manufacturers) and 350 member associations serving manufacturers and employees in every industrial sector and all 50 states.

Timken, who is the NAM’s most politically engaged chairman in many years, also will spend his year as chairman urging manufacturers – and their employees – to play a more active role in the development of public policy by becoming involved in the political process.

Based in Canton, Ohio, The Timken Co. is a 100 year-old worldwide leader in the manufacture and marketing of highly engineered bearings and alloy steels. The company has facilities in 25 nations, 20,000 employees and $2.5 billion in sales.

Kellis Parker, one of five black undergraduates who integrated UNC in 1960 and went on to become the first black law professor at Columbia University, died Oct. 10. He was 58.  Parker's first involvement in civil rights came as head of the band at Kinston High School. He asked the Chamber of Commerce to change its rules about putting blacks at the back of a parade, which the chamber agreed to do. At UNC, he and fellow student Allard Lowenstein, who was later elected to Congress, organized demonstrations that helped desegregate campus facilities. After UNC, Parker graduated from Howard University Law School and clerked for a judge of the U.S. Court of Appeals for the D.C. Circuit before going into teaching. He joined the Columbia faculty in 1972 and in 1994 was named to an endowed professorship.


NCCBI President Phil Kirk played a key role in honoring retiring State Treasurer Harlan Boyles (left) at Appalachian State University on Oct. 22-23. Kirk served as master of ceremonies for an evening tribute to Boyles on Oct. 22 and gave a tribute on behalf of North Carolina business leaders.

Kirk praised Boyles for his commitment to education through his service on both the State Board of Education and the State Board of Community Colleges. "Harlan Boyles is a strong voice for high standards and high expectations for every student and every educator . . . and he's not afraid to speak his mind. When he speaks, everyone on the State Board of Education listens intently," Kirk said.

Kirk used the words "honest, trustworthy, capable, reasonable, compassionate, and fair" to describe Boyles. Other NCCBI members speaking included ASU Chancellor Francis Borkowski, Hugh Morton and Senator Jim Broyhill, who chaired the committee to recognize the state treasurer.

Kirk also served as MC for the Harlan E. Boyles Distinguished CEO Lecture Series' Executive Luncheon on Oct. 23.

State Names in the News

Outgoing Lt. Gov. Dennis A. Wicker and his chief of staff and general counsel, Mack A. Paul, will join the Smith Helms Mulliss & Moore law firm's Raleigh office, where they will create and lead the firm's Government Relations Practice. They will join the firm in January after Wicker's term in office ends. "I considered several options for returning to the private sector, but the opportunity of creating and leading a Government Relations Practice at Smith Helms was the most exciting for me," Wicker said.

UNC-Wilmington Chancellor Dr. James Leutze has been tapped by Gov., Jim Hunt as chairman of the N.C. Rural Internet Access Commission. The 21-member commission will make recommendations to the governor, the General Assembly and the N.C. Rural Redevelopment Authority on ways to provide rural counties with high-speed broadband Internet access. The commission was established in July when the General Assembly passed legislation addressing the goals of the Rural Prosperity Task Force.

John Allison, chairman and CEO of BB&T Corp. in Winston-Salem, was elected chairman of the Appalachian State University Board of Trustees. His one-year term will begin during the board's quarterly meeting in December. Allison also chairs the ASU comprehensive campaign.

Jo Anne Byerly has been named superintendent of the Kannapolis city schools, effective next July. Byerly, the associate superintendent, will replace Ed Tyson, who retires next July 1.

Agriculture Commissioner Jim Graham was presented with the Order of the Long Leaf Pine in recognition of his service to the state. The award was presented by Gov. Jim Hunt. Graham is retiring in January after 36 years in office.

John Belk, a former Charlotte mayor and chairman of the Belk department store chain, announced a $28 million gift to Davidson College to provide scholarships to 40 students. The gift makes Belk, a Davidson graduate, the largest individual donor in the school's history.

Superior Court Judge Tom Ross, director of the Administrative Office of the Courts, received the William H. Rehnquist Award for Judicial Excellence from the National Center for State Courts. Ross will be honored at a Nov. 13 dinner in Washington at the Great Hall of the U.S. Supreme Court. Ross is resigning at the end of the year to become executive director of the Z. Smith Reynolds Foundation.

Ashley Thrift, chairman of the N.C. Partnership for Children, received the Adelaide Holderness/Michael Weaver Award from UNC-Greensboro for his work with the Smart Start program. Tom Lambeth, executive director of the Z. Smith Reynolds Foundation and a former partnership board member, also was honored by UNC-G with the Charles Duncan McIver Award.

Gov. Jim Hunt received the first Peabody Award from the UNC-Chapel Hill School of Education Alumni during the Alumni Awards breakfast. 

U.S. Trust Co. President Sue W. Cole of Greensboro has been selected to receive the Distinguished Alumni Award from the Brian School of Business and Economics at UNC-Greensboro.

THIS IS THE END OF THE FAX/PRINTOUT VERSION
OF THE NOVEMBER 2000 ISSUE OF THE FOR MEMBERS ONLY NEWSLETTER