| State Health Care Costs Jump: State
employees, who have gone nine years without an
increase in their health insurance premiums, will
likely face big increases this fall. Legislators
were told that the culprit is the increased cost
of prescriptions since the state health plan
started providing prescription drug cards in
January. Jack Walker, director of the health
plan, told a legislative committee the number of
prescription drug claims has doubled. "In
the first three months, we filled as many
prescriptions as we previously did in six
months," he said, according to an Associated
Press report. "We had about $500,000 worth
of Viagra in the first three months, so you're
looking at $2 million a year for state employees
and public school teachers," Walker told the
committee. A prescription diet drug covered by
the state will run about $1 million a year. The
health plan is expected to face a $50 million
shortfall next year, which legislators must
address in the budget, said Sen. Tony Rand,
D-Cumberland, co-chairman of the Joint Committee
on Employee Hospital and Medical Benefits. Walker
said the state's costs for health coverage for
workers will increase by $100 per worker per
month, while employees paying for family coverage
will see those costs increase from $281 a month
to $431 -- a cost that will "put some people
out of family coverage. They simply won't be able
to afford it." Six of the 11 HMOs in the
state plan are dropping out, and Walker predicted
there will be none left by the end of next year.
"It's pretty obvious we've got to cut
something besides taxes," said Sen. David
Hoyle, D-Gaston. The committee asked the staff to
come up with possible solutions within 30 days so
they can be considered during budget
deliberations. But Rand said lawmakers will
probably have to rework the health plan to
control its costs. "I don't know if we have
enough time for a major rewrite this
session," he said. Rural Internet
Access Plan Takes Shape: BellSouth, Sprint
and GTE have signed a landmark agreement with the
state to bring affordable, high speed Internet
access to all North Carolinians within three
years. The agreement will allow rural areas to
have Internet service at a cost and speed
comparable to the state's urban areas. "This
partnership between the state's three largest
communications companies and the state of North
Carolina will help rural families and businesses
get the Internet access they need to be
competitive in the economy of the 21st
century," said Gov. Jim Hunt. "By
brokering this agreement, North Carolina is
leading the nation in bridging the digital
divide. BellSouth, Sprint and GTE hope to provide
affordable, high-speed Internet access throughout
the state within three years and local dial-up
Internet access from every telephone exchange
within one year. Bringing high-speed, affordable
Internet access to rural North Carolina was one
of the recommendations included in the Rural
Prosperity Task Force report. Erskine Bowles,
head of the task force, helped negotiate the
agreement so that rural parts of the state can
benefit from some of the same economic
opportunities enjoyed by the state's more urban
areas. "In a few years, companies that can't
do business on line will be disconnected from
doing business with all of the Fortune 500
companies," said Bowles. "This
agreement will ensure that all North Carolinians,
regardless of where they live, will have equal
access and equal opportunity for success."
The plan was given a major boost when MCNC, the
research center in RTP originally created by the
state to develop microelectronics technology,
said it will contribute $30 million to an effort
to provide high-speed Internet access to rural
North Carolina. MCNC CEO Bill Kress said he made
the offer in part because of negative publicity
that the center gained a windfall profit from the
sale of a spinoff unit, Cronos Integrated
Microsystems for almost $600 million last month.
Kress said MCNC would give $30 million from its
$200 million portion of the sale.
Hurricane Floyd Aid Slow in Coming:
State agencies have fallen behind schedule in
getting state aid money to victims of Hurricane
Floyd, and legislative leaders have asked
administration officials to explain why,
according to a story in the News & Observer.
Records show only about $102 million in state
money has been spent. When state officials asked
for the money in December, they estimated they
would spend about $468 million by May 1 -- not
counting the money needed to match federal
disaster relief funds. In addition to the state
money, almost two-thirds of $2 billion in federal
money remains in government accounts, even though
much of it was appropriated just a few weeks
after the storm hit last fall. Hunt said he would
have preferred that all the money had been given
to storm victims by now, but credited state
officials working on the recovery with a
"superhuman effort." Hunt said state
agencies began drafting rules for distributing
the relief money right after Christmas, days
after the legislature's special session.
"You can't just start sending out money
without some good rules to prevent fraud and
abuse," he said. "That would be
irresponsible. So when you think about it, we've
really only had about two months to work on
actually distributing the money so far."
State officials say they didn't understand how
difficult it would be to get relief money to
victims quickly, while minimizing the chance for
fraud. News of the idle relief money comes as the
General Assembly is struggling the budget. It is
unclear whether the legislature might try to tap
into the unused Floyd funds to help cover
expected shortfalls. House Minority Leader
Richard Morgan, R-Moore, thinks the idea should
be considered, but doubts it will get much
support.
Healthy Balance in Unemployment Trust Fund:
North Carolina's Unemployment Insurance Trust
Fund maintained a balance of $1.25 billion at the
end of 1999, according to ESC Chairman Parker
Chesson. The fund paid out more than $444 million
last year in benefits to unemployed workers. The
average weekly benefit for a North Carolina
worker in February was $212. The ESC was able to
increase by about 36 percent the number of
employers who received a zero tax rate for the
current year. More than 30,000 employers will pay
no unemployment taxes for 2000 due to the
changes. Total benefit payments in 2000 are
expected to reach $497 million. Chesson said it
is important that the state maintain a strong
trust fund balance to ensure coverage for
unemployment claims in the event of an economic
downturn.
Smart Start Meets Fundraising Goal:
More than $19.6 million in cash and in-kind
contributions were raised this year for Smart
Start, surpassing a $16.1 million requirement by
the General Assembly, the N.C. Partnership for
Children said. The total does not include more
than 130,000 volunteer hours. That time cannot be
counted under state regulations, but would be
worth almost $2 million under federal grant
requirements. This year's contributions to Smart
Start include the first installment of a
multimillion-dollar federal grant to the Chatham
County Partnership for Children. The grant will
be used to begin a Safe Start program to address
child abuse and violence issues, and is one of
only nine such grants nationwide. This is the
third consecutive year Smart Start has exceeded
its fundraising goal. The General Assembly
requires the program to raise $1 in cash and
in-kind contributions for every $10 it receives
from the state.The report
came as legislators began taking a hard look at
$88 million earmarked to expand the Smart Start
program as they look for ways to close a $450
million gap between projected revenues and
spending items already promised for next year.
"The bottom line is they will get more
money. It's just a matter of how much," said
Rep. David Redwine (D-Brunswick), co-chairman of
the House Appropriations Committee. Legislators
are taking about moving an estimated $15 million
to $20 million in unspent Smart Start money into
next year's appropriation. Under current law,
local Smart Start agencies aren't required to
return unspent money to the General Fund.
New Legislative
Committee: The General Assembly is creating a
new Appropriations subcommittee to handle
information technology issues. Senate President
Pro Tem Marc Basnight (D-Dare) said the
subcommittee will work to "better utilize
the money we have and avoid the mistakes of the
past," such as those that occurred with a
new centralized child support collection system.
Senate members of the Appropriations Subcommittee
on Information Technology are: Sens. Eric Reeves
(D-Wake), chairman; Linda Garrou (D-Forsyth),
vice-chair; Virginia Foxx (R-Watauga); Dan
Clodfelter (D-Mecklenburg); Steve Metcalf
(D-Buncombe); and Ken Moore (R-Caldwell).
Although House appointments have not been made,
the chairman is likely to be Rep. Joe Tolson
(D-Edgecombe), chairman of the House Technology
Committee and co-chair with Reeves of the Joint
Select Committee on Information Technology.
Hunt's Environmental
Ideas Backed: The Environmental Review
Commission has endorsed Gov. Jim Hunt's top three
environmental proposals, but also approved a
measure strongly opposed by the administration.
Bills to write into law Hunt's goal of preserving
a million acres of land from development, to
revise fees for auto emissions tests and to
pressure local governments to restrict
development in flood plains were approved. The
ERC also approved the Environmental Excellence
Act, which would allow the secretary of the
Department of Environment and Natural Resources
to waive standard environmental regulations for
businesses that want to pursue innovative ways of
controlling pollution. NCCBI has strongly
supported such a law and was elated that the ERC
finally agreed. Opponents said the proposal would
be unconstitutional and would leave North
Carolina with the weakest environmental
regulatory program in the country. Vehicle
inspection fees would increase from $9.25 to $11
for safety inspections and from $19.40 to $23.75
for emissions inspections, effective July 1. In
2002 the number of counties in which emissions
inspections will be required increases from nine
to 48, the emissions test will change for cars
made in 1996 and later, and the fee would be
$25.90.
Legislator Pleads
Guilty: Former state Rep. Richard Moore
(D-Cabarrus) has resigned from the General
Assembly after pleading guilty to charges of
sexual misconduct with three young men he once
taught. Moore, 29, received a two-year suspended
sentence, was fined $1,000 and ordered to do 100
hours of community service. He will also undergo
mandatory counseling and will be required to stay
away from A.L. Brown High School and off-campus
events
Highway Group Forms:
A group of legislators representing 10 counties
ranked the worst in the condition of highways has
formed to discuss spending on road maintenance.
Rep. Charlotte Gardner (R-Rowan) organized the
informal caucus after the release of a study by
UNC-Charlotte that ranked Jackson, Alleghany,
Wilkes, Burke, Forsyth, Watauga, Macon, Ashe,
Avery and Rowan as having the worst roads in the
state. The group discussed the fact that $340
million that could be used for maintenance is
transferred annually from the Highway Fund and
the Highway Trust Fund to the General Fund to pay
for the Highway Patrol, driver's education
programs and other expenses.
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