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NCSBA Legislative Update – June 15, 2018

Lawmakers are holding a rare Friday session today as they work to finish up the 2017-18 session soon.  Activity on Jones Street was busy throughout the week, with dozens of bills moving out of committees and both chambers.  The plan is to finish up statewide bills that go to the Governor today, consider local bills and constitutional amendments next week, and do any veto overrides the following week.

Make sure to pay attention to your emails for action alerts as bills move throughout the day today. 

A Senate proposal to let the voters decide on lowering the maximum income tax rate allowed by the NC Constitution cleared a House committee this week.  SB75 would lower the income tax cap in the NC Constitution from 10% to 5.5%.  The current rate is 5.49% and is scheduled to go down more next year to 5.25%.  If the amendment goes to the voters and passes it would mean that no future session of the General Assembly could raise the rate higher than 5.5%.  The Senate passed the amendment last year so if the House successfully passes it before session ends it would go on the November 2018 ballot.  Constitutional amendments do not go to the Governor.

NCSBA has several concerns about such an amendment.  Chiefly, a drop of this magnitude (4.5%) would tie the hands of the State to respond to economic recessions or other events that cause a drop in State revenue.  Such a restrictive cap could also negatively impact debt service and make bond issues more expensive by potentially jeopardizing NC’s AAA credit rating.  NCSBA believes that at the very least the tax cap should be set at 7.75%, which is what the top marginal rate had historically been before the General Assembly collapsed the marginal rates down to a flat rate in 2013.

The amendment is now in House Rules.  NCSBA is working with members of the committee to try to change the amendment to get it up to 7.75%.  Please contact members of the House Rules Committee and ask them to oppose the amendment or increase the cap to 7.75%.  Click here to find and contact members of that committee.

Click here to read more about the House Finance Committee’s discussion.


Still Need Legislative Action as of 1:00 PM 
HB1031- Local Ed. Funding Dispute Process.  The bill to change the current budget dispute process between boards of education and county commissions passed the House floor Wednesday and Senate Rules today.  It is on the Senate calendar for today.

The bill would remove the option for a school board to file suit in superior court over current expense if mediation fails.  The new process under the bill would continue the mediation process but if the mediation is not successful instead of the board filing suit an automatic funding formula would be triggered.  The formula would be the amount appropriated per student the previous school year multiplied by 1+ the Employment Cost Index (ECI) for primary and secondary education x the ADM for the upcoming year.  If this happens 3 years in a row there would be an additional penalty of adding 3% to the ECI.  It would not alter any existing local funding formulas.  Disputes over capital could still go through the court process after mediation.

NCSBA had expressed concern on the original bill that if the commissioners gave nothing for school capital then the formula would derive nothing.  HB1031 was revised to include a provision to have a working group study a mechanism to resolve disputes related to capital outlay, which will include representatives from NCSBA and the Association of County Commissioners.

SB15- ISD Changes and Capital Grant Clarification.  This makes various changes to the ISD statute.  It narrowly passed the House yesterday and is likely to be taken up by the Senate today.  The original version ALSO had a provision on LEAs employing superintendents’ spouses.  This language was stripped from this and put into another bill instead (HB611 see below).

NCSBA has concerns about 2 provisions in SB15:

  • There is language that removes the cap of 5 schools and allows the ISD superintendent the option of selecting up to two additional low-performing schools for the ISD beginning 2021-22.  We have no idea if this model works or not.  This upcoming school year will be the first for a school to operate under this model.  We have a couple of years in which this provision could pass once they have shown they can be successful.  This expands what should be a pilot before it has even started.
  • It also allows for schools that adopted a turnaround model such as a Restart to be put into the ISD. This means the LEA may not have a chance to try to improve the school on it’s own.

We are working to try to get these provisions changed.  The only way the bill can be changed is if the Senate votes to not concur in the House changes (the House added this language) and the bill gets sent to a conference committee.

SB15 also makes some other changes to the ISD law dealing with career status teachers, the selection timeline, and other areas of the ISD law.

Passed Both Chambers and Sent to Governor
SB335- Budget Technical Corrections
Lawmakers quickly put out and passed the annual budget technical corrections bill this week.  There are several areas that impact public education.  One that caused great alarm was Section 7.4(a) and (b) would strike language that protected LEAs in their request to cities for reimbursements for road improvements.

This is being repealed in HB374.

Click here to read more on this issue.

SB125- Various Changes to Education
The House Education Committee stripped out the original language of this bill and inserted an item on public education.  The provision encourages local boards of education to adopt student attendance recognition programs and establish guidelines for those programs.

HB611- Employment Contract Exception
This bill legalizes employment relationships between any NC local school board and the spouse of the superintendent, if that employment relationship has been approved by that board in an open session.  Earlier versions of this language, including a provision in SB15, had limited this authority to counties/cities below a certain population level.  That language was stripped out of SB15 and this version moved instead.

HB670- Protect Educational Property
This would make it a Class H felony to communicate a threat of mass violence on educational property.  NCSBA supports this bill in line with the school safety survey that was sent to school board members in March.

HB986- Various Changes to Education Laws
The Senate Education Committee took the original contents of the bill- to establish DPI reporting requirements on LEAs complying with the cursive writing and multiplication table curriculum mandates- and tacked on several additional K-12 provisions.

  • Direct SBE to repeal the existing mental health policy and then have DPI develop a content standard for a mental health training program that includes the provisions of HB285.  This would create one set of school employee training requirements for youth mental health/suicide awareness instead of multiple training requirements.  It would also allow for remote training programs.
  • Require LEAs to place students who score a level 5 on end-of-year math tests in be placed in an advanced math course the following years.  This was put in on the House side. 
  • Direct the State Board of Education to provide information from annual performance reports for educator preparation providers in a user-friendly format that allows comparability of data, and remove requirements for UNC to incorporate that information into the Teacher Quality Dashboard.
  • Require the State Superintendent of Public Instruction to study and make recommendations on ways to reduce testing not otherwise required by State or federal law.
  • Create a “Renewal School System” model that authorizes Rowan-Salisbury to apply to the SBE to have all its schools operate with various charter-like exemptions from State laws/regulations.

Please note that there will be NO LEGISLATIVE WEBINAR on Monday, June 18.

Click here to access all the NCSBA-tracked bills that had action this week as of this morning.

Rebekah HowardNCSBA Legislative Update – June 15, 2018