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House | May 19, 2015 | Committee Room | Appropriations, Part 1

Full MP3 Audio File

The committee will come to order members will take their seats all that conversations will be taken outside the room. We anticipate along in productive day today so I appreciate everybody being here this morning and probably this afternoon maybe tonight we will see do you want to recognize pages who are with us this morning Mitchell Olman from Cleveland county sponsored by the speaker. Divine Gos Speak from Mecklenburg county sponsored by Representative Bradford Clay Griffin, from mecklenberg County, also sponsored by Representative Bradford, Giulio Hivo[sp?] from Lancaster South Carolina and Leaser Johnson from Florence South Carolina, I guess our neighbours to the South are visiting with us this week and both of those young people are also sponsored by the speaker so welcome and I'm sure we'll keep you busy at least interested in our process today. Members couple of house keeping items as we get started here, first of all I will just make a notation with respect to the schedule, we will talk about rules briefly, we'll have the PCS before us, we'll have some initial comments, particularly with respect to salary and for other items with respect to the Bill, we will be calling on each of the Appropriation Committees, Areas Committees for their Chairs to come to the well here and give you the highlights of their budget area, those Chairs that time, we will take technical re-clarifying questions but we will refrain from debate on the items that will allow us to move through the overall explanation of the bill and various parts, and then we'll move in to beginning the process of amending they're considering amendments those are in order also today as you may be aware there's a join session I think it's 2 O'clock in the Senate Chamber to basketball team on the winning of their national title I think they did say that the Carolina fans were also invited to attend but probably not required we will take a break probably around 12:30 and that will and that will allow time for people to get some lunch and to go over and be part of that session we've have asked that they keep the remarks over there the congratulations within a set period of time we'll see how that works out we will be back here taking up amendments following the session 15 minutes after that session will be back in here to do the balance of our work these evening it may take an additional break just depending on what the workload looks like this evening. With that, also in by way of discussing the rule you have the rules in front of you for the committee procedure I would ask you to make sure y look at those closely they'll be followed closely. The main one and these are the same rules we operated last year, year before and for some prior years, I would point out probably the main one of the main items on here is that you down in rule 14 and it's put in bold that you must have your amendment request into the drafting staff by noon. So it's got to be in hand that request must be in hand by noon today in order to be potentially considered later in the process. So you have the rules in front of you, any procedural questions before we get moving forward. Mr. Chairman. Representative Baumgardner I'm I to understand that we are

going to have amendments in by noon, are we going to be through going over the bill by then, do you think? I would certainly hope so. What that is Representative Baumgardner, the request for an amendment must begin to the staff by noon. Sir, the amendment itself may not be completed in terms of its drafting but that request rest of the staff must be in by noon. Follow up. Yes sir. Well the reason I'm asking is, if we are not through going over the bill by noon and we're to have amendments by noon, we don't know whether we want to have an amendment necessarily until we're through going over the bill . I can assure you we will be done with the bill before noon in terms of the explanation. Other questions? Seeing none Representative West moves that the PCS for House Bill 97 be properly for the committee without objection. Without objection, the bill is properly before the committee. We'll now start with the explanation of each part of the budget and we will start with the chair [xx] Representative Dollar may proceed Thank you Madam chair, members of the committee I will go over a couple of a highlights of the overall budget and in particular we will focus on the salary issues the overall budget for the biennium does is an increase in pending of about 6.3% for the biennium that is below the estimated may be the estimate for the increase in population and inflation for the two year period of time the increase in the budget of course is more waited to the first year of the biennium and I would point out just some of the major overall areas this might give you a little better idea about the structure of it, of the budget. In Roman growth accounts for over $410 million and when I say in Roman growth what we are talking about is medicaid in Roman growth and that is principally new people be who will met new people who will be on estimate beyond the medicaid row where of course for the next year or public school enrollment which is growing and our university in Roma which is also growing and it's probably a slight decline in terms of community college, but those requirments for growth amount to a little over $410 million. Salaries and benefits for the bioniums and we'll talk about the details in just a moment, but salary and benefit increases for the first year of the budget, and this is pension and plan and all of it $434.7 million, those two items together account for almost 845 million dollars out of a difference between the amount for the current year budget and the amount proposed for 2015/16. Economic development the other big piece is economic development initiatives and funds to amount $158 million as we continue to work to build our economy, to make sure that we have a prosperous state and the state they can move forward in the future with strong economic growth and higher and better paying jobs and for all the state actually, and the other adjustments amount to a balance of $70 million. Going on to the some of the highlights with respect to salaries and benefits we were very pleased that we were able to provide a 2% across the board salary increase for the teachers and state employees in this budget, I know there were some concerns last year for example with respect to some of the more senior teachers and some administrative and other personnel in school we believe and I'll probably have to have staff explain all over

if you want it all explained but we believe that we have worked very diligently to adress all all of those issues and to make sure that everyone truly does get at least a 2% increase with respect to their towers in addition to that we've addressed stepping pres for deputy assistant deputy magistrates and we've taken several steps with respect to the highway patrol to address some long standing salary issues there we also of course fulfilling the pledge that was made two years ago ti raise starting teachers pay to 35 a thousand dollars a year and at the minimum and I think that's a welcome a film of the commitment that was made by this gentlemen somebody two years ago I'd also point out that with respect to educators as you know we have the budget looks a little different in some respect you know CEO salary scales quite the way you did in past years the recent salary schedule system in place and compensation system in place and this budget provides as for the movement between those six levels I'm not going to count steps and stay with network those six levels and that amounts to approximately $65million to be able to do that we also provide a 2% colour for our retirees, we meet our obligations with respect to the State Health Plan and have a reserve after the State Health Plan and other benefit needs in the second year of the biennium. This budget also provides $200 million for savings reserve, that will mean that our savings reserve balance will now grow to $851 million dolllars. And I think depending on how things in the economy continues to move along as it has, and as we anticipate, we hope to be able to reach a billion dollars in the Rainy Day Fund or the Savings Reserve Fund by the end of this biennium, and I think that's guarded. of us have shared for some time are glad to see ourselves make a substantial down payment on that this year and hopefully be able to achieve that goal by the end of the biennium. We are also putting in place $200 million for all in all, repairs and renovations as many people have discussed in the past we continue to work on that issue to make sure we're probably repairing and not fitting those buildings facilities that we currently have. I'd also point out, I think some people have I asking, and so I would point it out now, with respect to taxes you do have $360 million in tax reductions based in to the first year, and probably you'll hear more than that based into the second year, and that is a combination of both a reduction in the corporate tax rate, and also a half of those reduction in income tax. Both of those reductions were put into place anticipated in the tax reform that was passed, seems like a long time ago, but couple of years ago, we have been able to meet our growth in state budget revenues in order to get those figures for for next year and so those deductions have been accounted for and their revenues that we have available for us today so I believe that without getting into much debate at this point Madam Chairman, I'd happy to answer technical questions with respect to, I'll have staff answer questions with respect to, excuse me, with respect to salaries but I will just make one comment at this time and that is the

budget is balanced, it's responsible we're returning money into the economy as a result of the actions that we have we do have a growing state, and needs that we're working to fulfill and you will hear the details of those today. I think some very exciting initiatives, some things that unfortunately we have had to put off for some time that we're working on, being able to catch up on and to put our state forward. I particularly think about the courts, but I'm not going to let them say that, but there are a couple of really proud points and so I think education is a very proud point as well and some others, and of course, transportation is always looking for money. I would make one other quick note with respect to salaries and that is that this will be the third year out of five, out the last five, the third year out of the last five that we have provided some salary increase and though I think that's a good record and we hope to continue to build and to address the needs that we have to have the best teachers possible in our and the best professionals, most highly trained and skilled are serving our citizens in this great state, so Madam Chairman, that is the conclusion and we'll entertain technical questions on the salaries if you wish. Thank you, Mr. Chair, if everyone would just be patient we're going to make sure that everybody is heard today. We have right now Glazier and Michelle for questions starting with Representative Glazier. Thank you, very much Madam Chair and thank you, Chairman Dollar, and this relates to the point we talked about right before, I just want to raise it and sort of best laid plans, and I appreciate talking with you, but I wonder if we could sort of publicly direct staff to ask them if they could get back to us as soon as possible on the effect yesterday of the Supreme Court's opinion in Maryland Vs Win[sp?] which looks like it's going to have an effect on our revenue and it certainly affected Maryland's revenue yesterday by 200 million. So, I know we can't know yet, but to the extent that we could if you'll be directing staff just let everybody know as soon as we find a number we would appreciate it very much. We'll have the staff working and analysing that issue Representative Michelle. Thank you Madam chair and Mr senior chair just a couple of questions don't understand what you have here there's an overall 2% increase in salary for our state employees is that on a graduated basis or what because the reason I raised that's because those employees at the lower end of the total poll that 2% double transfer to those making at a higher end of the total poll than it should and I'm wondering whether not is there a graduation there or any other bonus is going to help those people on the lower end of the salary scale. It's 2% across the board increase. Follow up madam chair. Follow up. Certainly so that person making $20, 000 a year in salary gets $400 while that person making $50, 000 a year gets $1000 so that's the way it's going to operate basically. Well one of the challenges that you run into and I appreciate the question representative Michelle, last year we did a flat amount for state employees and so some employees will receive a if you saw at the break point below the break point you'll receiving a larger percentage than above the break point the challenge you have in managing this is you get salary compression and we've had a tremendous amount of salary over the years where the salaries have been going like this and so whereas you have issues at the lower end of the salary scale you also have issues at the middle levels and higher levels in being able to recruit the professionals and retain professionals that you need. We hear from several other departments constantly about losing professionals, accounting professionals at one

of the areas that others as well, because we can't compete in the private market place, so we're trying to help address that. Also as concerns last year as you'll recall, more senior teachers felt like they did not participate as much in the increase, because we really we're trying to raise significantly the younger newer teachers in the system to be able to address serious retention issues and begin to raise that up. Two percent obviously as well as some other detail changes in there, trying to address the upper hand  with respect to teachers. I would also know that there is a compensation study and work actually development of the compensation system. It's really not a study but a compensation system, that OSHR[sp?] is working on, we've had what on that we anticipate that their work will be done by winter or spring of next year for consideration for a market blend based system of salary for state employees we also had have been their in the budget a fund to make $10 million fund to make market based adjustments people below the market now, also we've just made that the collectional officers they will also study done quite a bit work done and the governor had this in their budget to do a variation in custody levels and implement really sort of a new high framework for correctional officers, this budget includes fund to implement that beginning January 1 2016 that begin to see and there are certainly on the low end of the salary scale inducing extremely dangerous work every day so I think we would be pleased to be able to take work is being done on that and we will be able to fund it. Madam Chair I just have one follow up if I can. Certainly. Could you explain to us the increases in teacher pay it appears you're went with going to 35, 000 for the beginning teachers that's a little bit larger than a 2% for upper scale can you explain how that works and how the all teachers are going to be paid under this plan you got. well that's correct, if you are moving up to that minimum level and it's probably more on the order of  6% increase, at that, yes. And that actually runs for several years because as you know we had a time there were frozen and you got a lot of flatness in the teachers scale and now we're trying to get it. We're still trying to work on getting that curve where it needs to be if you need further answer we can call on staff for further details on that if you wish. Madam chair I was trying to get a comparison on the scale. Maybe I can explain there, you're talking about the promise that was made, which we made last year in the budget, bringing starting teachers pay at just 35. everyone gets the 2 % that the starting teachers of course get the percentage that is the 35% plus the 2% which I believe equal somewhere around 6 for that first day off but that's something that they just had to wait on from last year, is that what you're asking? No madam, what I'm trying to get at the older teachers with the changes that are being made this year. Have you given them anything that amounts to a bit more than 2%? That's where I'm going. I understand you mate, you don't work from step but have you got there? Can you explain that to us. Representative may be we should have [xx] explained and I'm not exactly sure what your asking, and then my [xx] nice better job. Okay, in the back on you.   [xx] [xx] retouch the teacher service battle the first tears that hear before they started pay with increase from 33, 000. from the 30 per thousand year. The salary on the other 5 years was increase to 2 %. So, all of those teachers even if they don't switch tears on the new schedule will get it.

Teachers of the top of the scale, those who receive the thousand dollar of donors were here, that thousand dollar has been put into [xx] increase. pay. And they receive a 2% increase. So relative to the conference year, that 14 to 15 pay, they'll get a 2% increase but they will not be harmed, and go back to having none referring bonus unpaid. So the'll get their $1000 they received this year again with 32% increase. Yes any of those who'll be moving from one level, to the next level, on the teacher payscale without also receive a corresponding increase, is that a set percentage? The difference between each tear is not said. There's difference between tear five, and tear six and 71/2%, so that's it life service substantial increase. Step forward who earns a year of credible experience and moves to step five, will see their salary go from the minimum State wise salary, from 33, 000 to 37 22030 I believe Right seeing no other questions and you can ask them at any time during a meeting we thank you the senior chair and our next step of education so we have our chairs to come forward Thank you madam chair Goodmorning first time since I've been here I get to talk about what we're adding and rather than what we're cutting and I'm pleased to and that is the house education appropriation committee reported out their budget with unanimous support first time, I believe in over a decade so let me run quickly through the highlights of our budget. 2015 to 17 budget fully funds [xx] by providing $100 million in 15, 16 $207 million in 16, 17 we are going to maintain our teacher assistance funding as it has been this house is support to great teachers assistance we're greatly enhancing text book funding and changing actually the normal culture from text books to text books and digital resources as we move ever closer into the digital age we're supporting four major initiatives in our 2015-17 education budget a fundamental change in how we organise and pay teachers in classroom and in an attempt to put our kids in front of the very best teachers to the greatest extent possible expose them to the most confident of all of our confident teachers. Continue the digital learning projects that we've started over two years ago by enhancing wireless capacity in the classroom not just to the school providing professional development and a creation of original consultship for both purchasing educational technology as well as professional development. A new teacher recruitment and attention program focusing hard to staff schools and hard to staff subjects. And principle preparation acknowledging the need long over look to help our principles become the best principles in the country. We are establishing performance bonuses for teachers in career tech and advanced placement programs and continuing our move toward offering opportunities for at least serve to get to a school that best meets their particular needs we are insuring no decrease in pay for assistant principles when they move into that position. We are eliminating some paper work, thank God and at last by eliminating eight state board and NLEA reports that we are deemed no longer necessary we are continuing a form of penetrative grant for extensive

learning programs and after school learning programs, for community colleges we are going to find summer enrollment we are going to create as we've discussed last year, an opportunity for those students that apply for and accepted at university in that last which unfortunately we know as a rather unsatisfactory graduation rate an opportunity to save themselves some money and and move to a community college and actually get an associates degree and still have that slot held for then in our universities we are going to modify management flex adjustment we are increasing tuition at community college level you get to keep it the funds for technology and platform upgrade and expansion 15 million and instructional equipment and technology and we are going to fund our veterans tuition. Last year we began the yellow ribbon program which was overtaken by federal law and now we are going to find that for our veteran both at the community college level and university level, at the university we again fully funded roman growth and we are going to increase our support for East Carolina University medical school excuse me we kept general fund expenditures on university advanced activities advancement activities and as with, I mentioned with the community colleges, we're going to fund the veterans tuition, there's $9 million there we're going to reinstate the Off Debt Collection Program that UNC Chapel Hill and ECU School of Medicine and we are going to increase funding for need base scholarship we're extremely proud of our initiatives and what we're able to bring to education in North Carolina and 2015-17 budget, I ask your support Follow up Thank you, Mr. Chair. Do we have any questions? Representative Glazier Just a quick question, and thank you Mr. Chairman, and this goes to page F9, item 50 this is the university flex budget and I know the committee and the chair have worked hard to get the additional on that that was added to that cut down from an initial, but can you tell us what's the ongoing number? That is, this is the additional of 26 million to the cut to the flex reduction issue but there's been an on going number that we keep adding to and I would like to know what the total number is that we keep adding to each year is that choice where we need to go in the future.   I'm going to ask staff that they would respond to that please, if that's okay with the Chair. [xx] fiscal research, we'll get that number to you at the university system when they receive the mad reflexibility cut just incorporates that, so it's always a part of you won't see that cut again on my Gather Agencies, like the Community Colleges where you see magni-flexibility results show up every year, we will get you the magni flex reduction results of the university system. Representative Brown thank you Madam Chair Where are you? To your right, Representative hogan in the way back, sitting in the cheap seat back here. Just a clarifying question if I could on F1 Item B4 the Low Supplemental Funding portion, the three LEAs that had increased allotments, Cumberland Cleveland what was the third process behind the increase of those three LEA's low well because of the alcohol and operation of combat pay an operation which I hope for all of us are sexist are short lived as possible skewed them out of, because their combat pay fusions and this high military district populations as queued that and they were scheduled to fall all the way and we're trying to ease the pain to the greatest extend possible. Representative Richardson Thank you Madame chair representative Owen

I have a question on F seven item 42 will that community college serve every student om that district only or will they be, how will that population be accepted into that program will they come state wide or will they come from that region of the state? This is a pilot program in conjunction south Piedmont community college which serve both Anderson and Union counties working together with the high schools the LAA's to see about further address the remediation issue there's a lot of question about get to this whole mediation point, I like at a lttle bit to driver license issues we had a couple years ago where did so many kids taken drivers and fail the drivers test, because we are not teaching what they were asking? Could that possibly be what happens when kids go from High School to Community College knowledge that we're not teaching what they are asking, we need to collaborate a little bit more and test some ideas in that area, and that's the sense behind this project, then we can run it out safe ride if it worked yes but thank you the other representative Johnson, do you ask for a question, okay Willingham? Thank you madam chair Senator on page F3 regarding bonuses that are being paid My question $50 and 18 also the $25 and $50 bonus are these bonuses paid per student or is this a one time payment to the teacher that year? It's not, these are recurring amounts so we're being ongoing, bonus paid to a teacher that takes on this project and then reach a success. Follow up. Yes sir so this is part of the salary I think that they've all submitted their salary? Yes. Okay, one more question for [xx]. Representative Rockingham with that's Stein and Representative Horn you have the floor. He asked you a question follow up. Yeah. Okay This is under the next page F4 and this is a charter school accelerator. I'm not familiar with the parental education system in North Carolina, is this a private organization or non profit? It is a non profit that promotes concepts around educational freedom, and charter schools et cetera, the accelerator is an attempt to help those areas that very well, very poor while it's very difficult for people to come together and investigate charters as an alternative Okay, one final question. Yes. This is regarding the 705, 27 Microsoft statewide agreement, was this bumping that was created out, or this was Microsoft's selected to do this particular work. Representative Thorne. It was recognized and probably the most broadly used platform across LEAs probably right here in this room are some of the fundamental programs such as Excel and Word and things like more people use that than probably any other such program, I'm not sure of the exact so rather than spending lots of money we can go ahead and purchase these user agreements and reduce the cost for LEA students across the state. Since it's so broadly used, it seemed to be a logical activity by us the state to help reduce those costs for everybody. It also allowed us to use some free programs. Your question is answered. I seem to have missed someone,

I heard someone call out a name, and I didn't get it. Is there anyone besides that's Rayne Brown? OK, Representative Brown. Thank you Madam Chair, a quick question on page F8, item 43, Caldwell Community College Driving & Training School, were those particular funds for that particular Community College, and wonder whether community colleges, which do provide that service and that education upcounty-, thank you. Am I right to answer that because that has a history in itself. The first program that was done, was done in Caldwell, and it's the request of those two to expand evidently they have tracking companies near them. It would be nice if we could do a dollar across the state, but it was not in one of the the first request from the administration, the community colleges, so in order to keep the program running, we did it that way till that dare ask to expand the program. Is that explained? OK seeing no more questions, we'll move on. Thank you very much Representative Horn and Halloway, Bran and Backwell, did a good job we'll move on now to health and human services. Chairman come forward. we're now going to acronym as I see it here try to remember what that is Abbreviation, yes, it will help us a lot. Representative Hailey you have the floor Thank you Madam Chair, we're going to cover some highlights that are a lot of people. We are continuing to meet the demands of the departments justice settlement regarding housing for people who will be moving out of adult care homes were including funding for continued ongoing development of easy fast and easy the tracks and quite a bit of what you are going to see is based on more or less a new direction, we are hearing a lot about outcomes and results and evidence based and the Departments has joined with us in budgeting to approach in what we're doing in Health And Human Services a little bit different that we've done in the past, and what we've looked at, is primarily focussing on zero to five, in beginning to evaluate programs, and whether we're getting the right amount of return in our investments and I will be giving the right dose as one our presenters said in one of the earlier meetings of a good program where it belongs. We're starting within the department, with them working to draft their contracts in such a way, that they will be measurable in terms of their outcomes and they would be able to put requirements on the vendors that they work with in order to get those evidence based outcomes. We're going to have the same requirement for termination upon 30 days notice which is typical for all of the contracts. But the area that I'm the most pleased that we're going at is with that 0-5 age-group where we are going to design a lead agency that'll work with the department and evaluate the programs that we use in support for those children in that age-group and you'll see that there is a justification review in our budget that is going to make funding for a number of programs, non-recurring the first year. Basically what that's doing is giving them a year to show us their results and let us find who is giving us the best aim for the buck of the oral eye whichever terminology you want to use. And that is we're also working through new appropriations to local health department because I don't think there is any entity in the state that is more familiar with the local needs than their local health's departments. Many of them do if not all of them, surveys of their health status throughout their county and we want to focus on where the greatest need is, primarily because one statistic  should make all of us want to get behind this approach, and

that is in the state of North Carolina with the significant resources that we have, first the major hospitals and healthcare providers, we still rank 40th in the [xx] of mortality and that's where a great bit of our focus is on infant mortality birth outcomes and we will be doing this through governmental and family support because we can't, forget that this is a collaboration between us and the families. We have also in terms of child care subsidy there is an increase of $1.7 million from the federal and pretake funding is the same as it was during 14/15 and we've also gone back and retracted have appealed to whatever the requirement where we've excluded the child care known parent child care relatives what grandparents will again be able to receive subsidies for children that they are in charge of and we will also pro right gain payments for those who have their children only in half day program something of that nature and we are also going to be looking review of our smart start precare in child subcidy programs as a continuum of care for that 0-5 so the studies is going to be looking at what each one of those areas provides and rearrange if necessary or [xx] where it's necessary to use their abilities and their resources to get the best results from the programs that we administer for 0-5 children. Another area we're looking at, and this is one that's close to my heart, are foster children. And one of the things that we have not been focusing on as much as we should is what happens to them when they transition out of the state's care from the foster care system? And we want to make sure that they're prepared to be able to live independently with the ability to manage their money, live on their own, and hold down a job. And we're doing a demonstration project through Youth Villages that we feel like will put us in a good place for a program that will focus on these children who have not had the concentrated mentoring and role models that they need in order to have those our skills to be able to lead our foster care systems and be productive adults, and we're also working to centralize this sort of approach so we know what's going on, so the department is going to be working with, studying ways we so we can, everybody knows what's going on, everybody works with what they've got in terms of their programs and the resources to be able to optimize what we do in our childcare Services and education and I'll turn it over to calling for further explanation. Representative Malloy. Thank you, good morning everybody in public health one of the things you might have been hearing out there is that more money is needed to achieve medical examiner, medical information technology system is what not and they are going to be getting 2.195 million in honor occurring in 16, 17. You just heard Representative Avila on the next issue what will help departments improve birth outcomes is exactly one of the biggest issues that we're facing today and that we're focusing on money is going to be 2.5 recurring in this cycle and next 2.5 million non recurring as well in 15/16 funding initiated block head process to provide funds to County health departments to use to increase access to pre natal care and prove birth outcomes in middle health development we increased this part of the budget by $33million we realised that there is a big need right now [xx] we need to bring in some money for Central Regional Hospital, 8.476 $374 recurring in both years. Three-way psychiatric beds, we know that there are a lot of people out there who need our help and we're expanding that to 4.927 recurring in both years purchase additional short term in patient psychiatric services in community hospitals item 53

this behaviour of health crisis units we need more care centers and facility based crisis center out there and this is to help that out then we have might have see house bill 923 establishing behaviour of Health partnership program what we're going to is to take $25 million from the deal maximum 25 million it might not be 25 million it will depend because it's a voluntary program in each of the three areas in North Carolina 50 bed pro in which and I'm just going to read it 30% of the bed will be reserved [xx] any dixprocias must be deposited in the middle Health Trust Fund, and will be appropriated in a short session department as directed, by recommendation how this funds will to be used and to increase community best behavior on Health Services we'd rather stay decreased in need for costly inpatient services. There a lot of people who need a badleted some Jamo, we don't need them in our Hospitals in the Hallway. and finally overnight respect, so I might become as family a member, we need a place for them to stay, maybe during the day, maybe overnight. And this I I'm going to turn over to Representative Jackson Representing Jackson. Thank you Madam Chair the division of medical assistance. This part of the budget is relatively undramatic, and we wanted to rediscover he did that deliberately. First of all no major cuts to providers, and providers taking major cuts, over the last several terms, and we wanted to make sure that we we didn't do that this time, so no cuts to provide us in the HHS budget as of now $2 million for traumatic brain injury waver the house budget provides the fund for a new waver for traumatic brain injury as it says special provision, directs the department to submit a waver to CMS report on HHS December 2015 and March 2016 that was also recommended by the oversight committee in the inner room. It's 2.5 million non-recurring in the first year 3.7 million non-recurring in the second year to address medicare reform keep in mind there's not a specific proposal within this budget, there's just the funds allocated for the reform. So, if you're looking for a Medicaid before home package in a provisions it's not in their we just allocated the money. The medicaid re-base the house budget provides funding for growth and enrollment change in the mix of enrollment the impact visualization changes and cross changes for services so this is known as the medicaid re-base 287 million the first year recurring 460 million the second year recurring fully funds the medicare re-base, their is a provision for non-emergency medical transportation is a special provision that appeared in the house budget previously and directs HHS to develop an issue of request for proposal for a contract to begin on 1/1/2016. one final item that I want to mention with regard to Medicaid. It authorizes DHHS to administer the Medicaid and health choice within their enacted budget. There's a small. 9% cut in a specific portion of the budget there's a small cut in the budget but it's only 0.9% and its within a certain section. Basically, what it does, it offers flexibility to DHHS to manage a portion of their budget and what it does, it gives them the flexibility that they need. This new division, fully authorizes DHHS to administer and operate the medicaid and health source programs within the enacted budget for each program for the fiscal buying in-except, otherwise specified in this budget or other state law, so this section in addition to that prohibits the the HHS from creating the liabilities in future years, it establishes a new joint this lady of oversight committee on medicaid. It requires the DHHS to report to the new medicaid oversight committee quarterly on programs, operations and annually within four year forecast is spending and anticipated program changes. So although we're giving the department the flexibility and the atonomy that they need, they're still going to be oversize from the general with regard to medicare. Requires additional advance notice to the General Assembly of proposed state plan amendments and waivers. So anytime that the department wants to make change and they propose a change they would have to report to us and we would have the opportunity to weigh in on that in the General Assembly. It also budgets an increase in the fmat due to federal changes which was a positive

thing for the state, the auto provides increased funding to support the anticipated growth in the help choice program and Roman[sp?] growth is projected to be 2.3% in 1516 and 1.1% in 1617. Also funds estimating increase in utilization and claims. And with that, that concludes our presentation to the committee. Thank you Representative Avila and Malone and Dobson, I admire, although that's not the largest budget, it is the most difficult but I, I was just to man and representative Insto[sp?] and the years that she had that chance to handle that money small areas in one amount of money, it'll be hard and representative Insco[sp?] I believe you have a question? Thank you madam chairman, I did in the sub-committee I think there's a lot of good things in this budget. I think it was really good to restore the home and community base care block grant. There're are some initiatives and the mental health system and early childhood that I think are really good but I was really interested in representative Dobson's comment, that the DMA section was undramatic and I would just like to say that that's really the understatement of the century. So I can ask you some questions about if you all I would invite everyone to turn to page 129 where we authorize DHHS to administer [xx] and health choice within their enacted budgets. So if I understand this correctly and maybe this is my question, does this section authorize the secretary of Health and Human Services to cut any optional services that she or the department would recommend without coming to the General Assembly? Does it authorize the secretary of the Department of Health Human Services to cut provider rates? Does it authorize the Secretary of Health and Human Services to independently send state plan amendments to medicaid to make any changes in the program, as long as it falls within the $3.7 billion state budget, and does this give her control of the $3.7 billion of state money plus the roughly $12 billion, this is billion dollars of federal money that goes with it and I don't know if this is a appropriate time for me to make a statement, but this is audacious I would say it's very bold, but it's also I guess it's startling. So I'm I correct about that? Thank you Representative Insko first [xx] for those who do not serve in that committee would you tell them what DMA is? Division of Medical Assistance and it covers medicaid for the state. Okay now you have the floor. Thank you Madam chair most of those questions can be in one package. So I'll try to do that the changes that will make requires the secretary in the department to notify assembly with more advance notice than in the past. Yes they can recommend state planned amendment changes or waivers however the General Assembly can change enact propose any thing that we so desire if we disagree with those recommendations may or may not be and to a certain extent the secretary already has this autonomy but this just requires more notification and we'll get I think at least two months of notification prior to any major changes being made and and we have to report to the oversight committee the new Medicaid Oversight committee. Follow up question. Certainly so Representative Dobson we've been seeing for the past two or three years various proposal that have come through from both the senate and the house, on how to reform Medicaid one of those is the I think the preference of the senate is to just contract with commercial manage care company to run the entire a program they would make their decisions about optional services they would make the decisions about rates I think the only thing we've retained was eligibility we also had a proposal for a

board of directors where we would create a new board of directors within the department of health and human services that board would be appointed by the governor by the house in this senate and they would make independent decisions about they would manage their responsibly will be to manage the Medicaid budget we've had a proposal for countable care organizations where we would actually there would be provider run does this provision actually is a substitute essentially for those all of those proposals that we've been debating and it would authorize the department to do essentially all of that plus then directs the department to come back this more recommendations about other options I'm I correct about that. I'm so sorry any further questions? Representative Dopson you have the floor. Thank you Madam Chair the short answer to that question is no any Medicaid reform proposal we specifically excepted from this autonomy for good reason that the legislature would have to vote on this and it would have to approve by us, by legislation, so no she or whoever in the department would not I'll have that authority we'll do that deliberately. May I ask a clarification question, certainly. Thank very much so I agree that this does not allow her to do that and then there's a plan to continue working on that but this actually does take an interim step that all of the Medicate provisions that are usually in our budget are no longer there. There's no in the money report one of the things that I thought about when I got this provision package was that this isn't very sick anymore and it's as all those Medicate provisions that are always in the budget decisions that we make are gone and the money report doesn't show the medicate budget sounds like we're transfering the entire management of the program over to the department at least for this year representative Abeler thank you madam chairman is for that very express reason of cutting out all pages and us having to make those decision that we put control of the state part of medicate funding again to the secretary who has always had the ability to make those decisions and our feelings are within that division the're extremely knowledgeable people who have the authority and should be making those rather than coming us who don't understand the in implicates of it and sometimes make the wrong decision and set off the course that we turn around and we've to back up on so within the confines of the authority that she already has controls of the quarterly oversight committee and I feel like that we'll see an improvement in terms of efficiency as well as results in the division I'm taking this step. Representative Stem, thanks I've heard a couple of times that this's not a dramatic budget change but I've also heard ovetr ther bianium that 200, 000 North Carolinians will be added to medicate roles can the she has confirmed that that sounds pretty dramatic to me. Representative Barbara thank you madam chair any additions in terms of recipient to medicate will be driven premierly by ACA they change rates and we end up having More people in program because of an income based change pre affairs but there's not been any tackles concerted efforts to please the number statistically I wouldn't ask if there a was any concerted effort I'm just asking isn't the projection action that will be about 200, 000 more added in the bionium Representative Avaler Yes but it's aca changes Madam chair Sorry representative Vinscar As I understand it for the past Two or three years the procap the income in North Carolina has gone down whivh means we're getting poor people are making less money and is that projection of the pro capital income falling continues to 2016 and 2017, when the pro cap, I'm asking if I'm right about this this is your standing, when the pro capital income goes down more

people qualify for medicate and so yes you don't have to make any policy decisions but as we get to be a poor state we will have more people qualifying for a medicat and is it true that our pro capital income is projected to go down. That was my affirmation. Representative Dobson. I'm not sure if I would hesitate to say that our projected per capital income is going down I'm going to have to do some more research on that, however, I would agree with [xx] in part to your point that it's just the Medicaid re-base ot's not a policy to change of expanding those who are eligible or expanding age or anything else, this increase is just part of the medicate re-base that's done every year that's mandated by the federal government since the beginning of Medicaid. Representative Inscor, I have some more people and I'll put you down at the bottom like AIDS so let's get far more better you still remain there, thank you Madam Chair I'm concerned about the change that we have talked about in term of Representative Insko, given what has happened with the apartment recently and we all sorted a new service server as well as what happened last year if see tracks in those kind of things where does the books stop? Will it stop with us? Is this the right time to do this or will it stop with the secretary? Representative Avila Thank you Madam Chair, I think the one thing that we have to recognize is so much of what we have looked at over the past two years the combination of project that has been in the work for six or seven or eight years and no one the switch was flipped it didn't but we can't lay the blame to the people who flip to switch, it was a go or far away a lot of money that we have spent on some of this programs and in terms of how many into multi-billion dollar operation in two years be enable to clean up issues of effectiveness and efficiencies I think it is unrealistic and we think we should look at some of the things that we have accomplished in the department and how far we have moved in medicate in particular but HHS in general in straightening out some long standing problems and taking some definitive steps to get control of it Representative Representative I agree with what Representative Alice said in part but I'm concerned about $ 1.6 million dollars involving nepotism and those kind of things as it relates to funding that are supposed to direct we impact on peoples lives who need it more than anybody in the State of North Carolina okey, Representative Hailey Thank you Madam Chair, on page G 10, number 50 about the Three Way Psychiatric beds if I'm figuring this correctly, its being increased to 43, 047, 044, making it come up to only 180 beds, is that correct? 180-185 180 beds, that's not 230 9 dollars 230 pounds and dollars will be it. It just seems like we could get another hospital and get better treatment. I just feel like you need to study this [xx] white bed situation which is 750 per day per bed whether they are used or not, I think that money could be used in a better way. Thank you. representative Insko. Thank you members on page P14 item 62 and three, you will see the Medicaid re-base. There's also S-chip re-base on that and you will see that the Medicaid rebase actually increases the federal share and will decrease the state share, but this Medicaid re-base also pays for that, those 200, 000 additional people that are going to come in because our per capita income is falling down. But any time you see the re-base for the federal share goes up, it means that we are getting to be a poor state, and the federal share pays more, so both of those items.

The reason the man can't re-base is an additional money is because of the that increased cost that would go with the new people that are coming on, but there's a considerable increase in the amount of money that the federal government will pay. Thank you so much, I have, there are no more questions, and thank you so much for your explanations. Next up is Justice and Public Safety, that's Daughtry, Faircloth and Hurley Thank you, Madam Chair and members of the committee. We're proud to bring you this proposed budget for the Justice and Public Safety Committee. I'd like to say that as I recall, the vote by the committee was unanimous on our proposal, and we have some items that I think are vitally important to justice and public safety in our state. The JPS Committee Budget provides an additional $42 million for the state's criminal justice agencies this time. There were some reductions primary reduction was improving security and staffing efficiency by installing electronic intrusion systems at four state prisons and doing away with the man the towers which did away with some personnel, so that was $ 2.04 million reduction there are some other operating efficiency throughout the GPS budget that amount to about 1.4 million which is very small. As far as expansion services, training for law enforcement and adult corrections has been in the works for since we've been back in Riley the great part based upon some of the things that have happened nationally and some of the questions that have arisen, because the relationship between the criminal justice folks that deliver services, and those who receive the services. Funds for training facilities it's an appropriate use of force training program for all law enforcement agencies and dope collections is funded for $ 6.2 million, we're making a a major investment in retraining our personnel particularly with regard to some of the afflictions we've seen in the society in the first year, with regard to the mental health within the correction system that's been a vital concern for many folks as it is in the general population, we funded 72 additional mental health unit beds at Central Prison and established Mental Health Behaviour Treatments Units that aid closed custody facilities in the amount of $ 8.86 million. We're also continuing the justice reimbursement programs that have been put in place over the last four years so and these are paying deffidence in many ways for as we're nationally know as the state for justice re-abasement we're very very proud that and thanks to our staff for that vehicles for the state highway patrol has been a problem they warranties on controlled vehicles is 100, 000 miles they've been driving quite a few miles more that once the warranty goes away cost of keeping them up become very expensive so what we've done if funded $9 million to provide vehicles for state highways and patrol house is the flow and state bureau of investigation so that we can keep it about 100, 000 miles and then turn them over, there has been and also discussion about the this year about cameras, as far as the state house it patrols concern rather than the body worn cameras the state house it patrol refer that it have the alter mounted dashboard cameras in their cars many of them still already have those over tight and the user display recording so what we are trying to do is equip all over why is the flow of the vehicles with

dashboard cameras and there will be a new style that provides much better storage of data and control the phisionaire[sp?] over time those over camera that are based on this, so all of highway patrol vehicle will be equipped with dash board cameras, the explanation of referring dashboard over the body money cameras is that most of the work most of what they do is behind the vehicle that they have thought for some reason on the side of the road so they want to be able to cover that area and has worked over time very accurately for them to do it that way rather than have a body camera which is been moving all over the place, encoder the court operations, jury fees and interpreters will increase the yearly budget for operations, interpreters, expert, witnesses, and juries and the state court system. We have as members of the JPS committee have been worrying over the past three four years about the core system and about the tipping point that we were we were nearing and which would begining to become unsafe for our citizenry if we didn't properly support our court system so that we're committing $10 million to the court system I think they're very glad to get that and we'll be seeing some not only catching up being done, we'll be seeing some advancements as well in the court system. Court Information Technology is vitally important that we're providing funds for IT projects related to e-Courts including e-Filing, citation processing and e-Compliance. $19 million we'll go into that, and hopefully we'll see the end of the green screens in the court system. There are a couple of special provisions, we're transferring recommending transferring the Office of Indigent Defence Services to the Administrative Office of the Courts, it will still be an independent commission, but it will be the part of the Administrative Office of the courts for advice and for audit purposes, and we're expanding DMA on a wrist to encompass all violent felonies, we would like to move all the way to all felonies and we're working on that, but at this point that's prohibitive as far as available funding, but we are going to be requiring DNA samples on all violent felons as they are arrested which will help us build up our files, and I would ask my fellow members if they have anything they'd like to comment on. Madam Chair Thank you very much, do we have any questions? Representative Farmer Butterfield. Thank you, Madam Chair. I have a couple of questions, I notice that you have vehicle cameras, I think that's great. What about body cameras? Could you elaborate on it a little bit, I thought you touched on it Yes, I certainly can. We're all trying to get rid of colds up here this year, I apologize. As you know the House passed a study bill to address the body camera questions and that has also been made part of the special provisions and we'll move forward with that study bill and we'll be receiving next spring the results of that I intend later on today to introduce an amendment that would also begin giving us some funding to begin purchasing some cameras. So we are very interested in that situation and are being active in pursuing it. Great. One last question. I noticed that you have funds for new health behavior treatment in prison. I think as excellent as a critical need, what about prevention of mental health patients prior to going to prison? Is there anything being worked on in that area? I would have to refer to staff. Staff, okay. Staff is recognized. Christine[sp?] at fiscal research. Mr Chair, I think that anything that would have been done on the prevention side would have happened in the HHS budget. So I'm going to refer that to the HHS staff or chairs. Denise Thomas physical research, Representative Farmer Butterfiled, there no new items specifically aimed at adult provision activity but there are significant amount in

the continuation budget and both general funds and federal block grand funds that will target that. Alright, representative Marshall. Thank you Mr. Chairman, I'm looking at special provision involving the Assistance District Attorneys can you tell me what's happening here. We were asked just to change the name of the victim to the, are you talking about that? Tom I'm talking about on page 201 the matter dealing with allocation of the system district attorneys. That had to do with with, at one we had by statute the need for district attorney is in every judicial system and when we're frozen because of lack of money we get a work formula based on the number of filings and so instead if having a statutory number, we're going to fund assistant district attorneys based on the work formula, is that right Stan? Can I have a follow up Mr. Chair? Follow up. Follow up, go ahead. Thank you sir. So instead of statutory allocating consisting different positions and getting a sith amount there is going to vary from what I understand it just depends on what district and what particular district is, is that what I'm. That is not correct, well it's an annual report and some areas are stated growing, some areas of rough state have additional case filings that others do not. Somewhere areas of our state are not growing and so the need of District Attorneys way, we have every year, a detailed report on what district attorneys are needed and use replace this for determining where the district attorneys go. So Mr. Chairman One final follow up So you are not going to be able. No District Attorney himself is ever going to be able to determine the number of assistance that he or she is going to have until this report comes in. Is that what I'm hearing? Once a year that's correct. It's the workload formula and the DA's will be a part of determining how the workload formula works. Representative Insko[??] Thank you Mr. Chairman. This may be a question for staff also. Do we know how many people are currently housed in our prisons that have a primary diagnosis of mental health?  I think we can refer to staff for that. Representative Insko [xx] John [xx] physical research 12% of the population at processing and intake are diagnosed as having mental health condition. A follow up. Follow up so is there any way to translate that into an actual number? yes get that for just a moment. Thank you. Representative Floyd. Thank you Mr. Chairman part of the question was covered by representative Michel but is it true on page 201 that one person makes the decision on the number of ADAs. It's a work load formulae it is not we are trying to take the politics out of it so you get you district Attoney based on the needs and they got their district atony some self working on the work load formulae and it's based on case files if your county is growing you are going to need excessive DA more rapidly than those counties that are not growing so we are taking the politics out of it with the case float balance I don't know anybody who has opposed to that. Thank you. I believe I have one of our staff members that's itching to respond to something. Thank you Mr. Chair representative Dortray is exactly right the work formulas are based on I'm sorry this is William Charles with physical research. The work load formulae is based on a study conducted by the National Canter for State Codes there are some language in here that are section B, of this provision, which is on page 202 verse 34 to 41, that provides for a you either work with formulas, with the conference of district and attorney involved. This is current practice, the

work of formulas has been in place since 2009. representative Richardson. Thank you Mr. Chair. Am looking at item page one one three, item 17. It looks like we are eliminating 56 positions in a maybe incorrectly and correct news Am and Franklin County Correctional Center is involved in there. Will those staff be, replaced or assigned to other facilities, will this jobs will be eliminated? Mr. Chair. I'll apologies as a staff please respond. Yes mum the positions will be eliminated by the department typically reassigns officers to other vacant positions. Thank you thank you. May representative Classier.   Thank you Mr. Chair and this relates to the item in page two or three the certificate release see, and it's a small question apologize if you said it and missed it, but how does one is there a provision in here that I'm missing that handles the indigent circumstance, and if there isn't would you object to being added by the amendment that handle the indigent client issue. We will not object. Fine, thank you. Representative Marshall. I want to go back to the DA's situation if I can Mr. Chairman. From what I'm hearing is that on an annual basis there will be reassessment of each district attorney's office to determine the number of assistance district attorney the are going to have in that office, for instance if there is an office one year had requires 18 assistant district attorneys, the case laws it all over next year to 14, to a point where that DA looses those four assistants that year and goes down to 14, is that what I'm understanding? Staff is recognized to respond. thank you Representative Dollar this is William Child Fiscal research, currently that not been the way that is been practiced the number of AVA's in the AIDS compared to the number that are actually funded and need there is a shortage about 70 AVA's around the state so there has not been a situation where there's been a need to move a position from one another. So it's just been back doing at this point. I'll get to take it out some way. Very well. Any other questions? for Jps 2 I'm sorry representative Harrison. Thank you Mr chair several of us have received correspondence about the of the Independence of the Indigents defense services. So could you just explain exactly what that special department does? It looks like it's moving Department of Justice to AOC The idea of putting IDS under the AOC was not something we thought of. We were by many stakeholders, it might be a goo idea to allow AOC to at least say where the money is going. We have no idea how the money is being spent and it doesn't seem to be anyone who is overseeing IDS. So this certainly puts under OAC for the purpose only up all the team, is to make sure we take the keys out of the car.  Representative Glazier. May I follow that point with Representative Daughtry and agree completely with the JPS decision on that and I think that the auditing function was always intended from the beginning of the statute. As someone who wrote the statute, I feel pretty comfortable about saying it, to have it there and it was always intended that there would be AOC oversight from an administrative point of view, and only this changes the the commission, but it provides the administrative oversight and capacity to look at budgeting and human resources and I agree completely with what you've done. Further questions for JPS this time? Seeing no hands, thank you all very much for the report. If I could just make one final statement to the other. Yes sir. Chairman it took us nine minutes to make our report. Noted and appreciate it.

Alright. AGNA, which for those of you who do not know, that's Agricultural agriculture and natural and economic resources. And I'm going to do my report in seven minutes or less we changed the tittle this year from just ANYAG to ARG or Agner we like to say, and that's to put emphasis on the $78 billion, Jimmy just reminded me, $78 billion industry, agribusiness has in our stake. And starting with Agriculture and Consumer Services the Food Safety Modernization Act by the Feds is coming into effect, and so we provided the department with $280, 000, and four positions each year in the biennium to provide out reach and training regarding the proposed FSMA rules, that to go out, work with the farmers and get them ready for this new federal legislation. We added 2.6 million additional non-recurring funding to Farmland Preservation Trust Fund. We also increased the annual funding for the Spay and Neuter program by $250, 000 and that's really to help our counties. Our counties now don't have gas chambers anymore so they're overloaded with animals and the way to nip that in the bud is to have low cost per neuter administered and grants through the counties and that's what that extra 250, 000 will do. In dinner, the clean[sp?] trust fund, we provided 16.7 million of the Bianium for clean water grants, and it includes four million designated for military encroach from barbers. OK, and then we have started some oyster initiatives. North Carolina used to be known for oysters and high production of oysters, now our restaurants are having to go to Virginia and other states to get those oysters. Oysters is not only clean up the water ways but they also provide a great food service in an economic development for the state of north North Carolina. So, in some of those [xx] initiatives we provided money for cultch planting, for oyster sanctuary and oyster research to develop the bridge stock to provide just for opening the leases. On a parking recreation trust fund, we provided 12.5 million non recurring in the first year in the Bianium, and 1.5 million recurring in the second year. We also provided funding for promotion of the 100th anniversary of the State park. I don't know if you all know this year will be the 100th anniversary of the State park, so we've given them some promotion funding for that on a non commercial luster UST Cleanup Fund we provide 2.3 million and that will eliminate the claims, the backlog of claims they're coming out of that fund. In water infrastructure we provide an additional $23.8 million over the Bianium for the state water waste water infrastructure grants that benefit economically distressed areas. In dredging we provided additional funding because of what the transportation group did for us, they provided motor fuel tax to support shallow dredging and that is considered the voter highway and they do use the gas. They pay the gas taxes so transportation came up with the idea that for a ofcourse 3.5 million of this goes to Organ inlet we have a huge a horrible situation at Organ Inlet where commercial boats can't even get out to get out and fish so that will provide funding for that in commerce we have the JMark and we provide the funding for payments for Bridgestone, Dontar, Evergreen and Goodyear. 8.5 million for the fiscal year 16/17. Tourism advertising, we increased it on a recurring basis by 2 million, and we are still behind our surrounding states as far as tourism funding goes, but we've seen the relationship of the increase last year that we gave him, and it has brought huge tourism dollars to the state. Rural Economic Development Division Grants,

we budgeted an additional recurring and non-recurring funding, 1.2 million recurring in 10 million non-recurring in each of the years, and that gives 24.6 million in 16/17 to Rural Economic Development Grants. When North Carolina's Small Business Fund, we provided an extra $5 million for that and then still in commerce, the North Carolina Biotech Center, we provide an extra five million on a recurring basis for them, totaling 13.6 million, and then with the support center, who provides grants and loans to to start businesses for low income, we provided 2.5 million in a non-recurring funding for the support center, and then we have a few special provisions I'll just highlight some of those the TBA settlement funds allocates 2.24 million that was left in the TBA funds, and that goes to western counties as per alignment with the settlement agreement, The Shallow Draft Raging Funding, the Special Provision just to mark 3.5 out of that motor fuels transfer for organ and try to fix the problem there in horticulture area, we prohibited the use of [xx] shells in commercial land scaping, we directed marine fisheries to work with commercial fishing industry to open up certain areas that [xx] that have been a [xx] a closure and we are talking about opening that up to to usher restoration and then we also allowed instead of doing regular allow them to use G. P. S to define the selfish areas. In the end community development black brands we allocated the funds with two major project categories 15.7 million for commerce economic development and 26.7 million for infrastructure and they will be provided the local government and on the grass root science program we appropriated 2.7 million across 31 museums, so we added one new museum, it was the discovery place in Rockingham. And I'd like to say that we passed our budget in Agnor unanimously by partners and support. Any questions I'd be happy to answer? Questions? Representative Hilton. May I address the speaker? I have a question. When public safety was talking about  Hikira manen cameras on patrol, and I guess the other law enforcement officers in the department, I'm concerned about our wildlife officers, I'll call him [xx] but they are out in votes, they are in cars, or walking through the woods, half the people they approch have  firearms and I hope there's a provision to buy them cameras that go on their uniform because they need them back in the woods. You know anything about that? No, I don't know about the special provision for that, but we usually don't dictate what wildlife does with their personnel, we put as  they are funded separately also from the General Assembly, and I'm sure that they protect those officers and I'm sure we have someone from wildlife here who is listening to your comments and they'll make sure that that happens. Representative Johnson Thank you, Mr. Chair. I've got a question regarding the food deserts. You mentioned that you have a small for business fine of $5 million would that not be part of that fund or eligible for that fund? Food Deserts? I don't know, may be we could ask staff that question Staff like to respond to the question. Aubrey Incorvaia with Fiscal Research. The one North Carolina Small Business Fund has been then provided non-recurring funds in this budget to offer early stage technology development grants for small businesses that receive federal awards from the Small Business Innovative Research program or the Small Business Technology Transfer

Program, food deserts would not quality. Thank you. Follow up, Follow up. Follow up. So, where would it go? It's agriculture. I'm just a little confused about that. If the Chair might interject, I believe if the people up here can hear better than I can, I understand that you're asking about the food deserts? Right. OK, that is in pending legislation, we have a category that's called Pending Legislation and that bill is cited in there in the Money Report as something that, should it pass, we would be able to fund it in whole or in part. Alright, thank you. Chairman Dixon. Thank you Mr. Chair, in response to Representative Pennington's question relative to body cameras for the wildlife resources commission Representative Pennington[sp?] we did have those discussions with the director of Wildlife Resources Commission and also coordinated with Representative Faircloth and the legislation that he has for study and the wildlife folks are properly accounting for how they will provide those under certain circumstances so that issue is being addresses in wildlife[sp?] Representative Floyd. I have two questions. One is the military [xx] is that an increase before 4 million. Yes we had 2 million just an increase of 2 more million. Second follow up. The second question is I'm not sure when you mention funding is good [xx] I think there was a 10 million [xx]. Goodyear is part of the JMAC funding and all we did was make sure that we funded our obligations for those companies that are already in JMAC approved. Thank you. Further questions. Seeing none, thank you very much for your report. Thank you and I'dd like to thank my co-cheers that didn't want to come up here with me today. And Chairman Doffrey[sp?] she did beat your time and I know you're pleased with that. Our next, before we go to our next committee I would like to recognize having joined us a moment ago several pages Tommy Johnson from [xx] county sponsored by Representative Reaves. Tracey Levy from Justin county sponsored by Representative, Mary Grace McConnell from Cabarrus County sponsored by Rep. Brawley. Nate Scovins from Guilford County sponsored by Representative Pierce, Peyton Stats from Richmond County, sponsored by Representative Goodman, and for those who have just heard that I didn't introduce them at the beginning and I asked them for a list and the sergeant at arms told me that it was all hand on deck today so the sergeant at arms has made me know that they're working this morning very, very early and they're all here Mr. Sherphad and his crew are all here helping assist us today and we thank them for their service as well appropriation committee to present would be general government Thank you Mr. Chairman. highlights of the general government budget for the year as we have in increase funding of about 8% over the base budget for 15/16 and 5% for 16/17 and the department of culture resources or providing funds for it and $130, 000 for the Museum of Art, $10 million for grants for the varies providing funding to continue the excavation of the Queen Anne's Revenge. Hopefully they'll finish that up this biennium We fully fund the Challenge Grant for the symphony, we actually raised

it to 2 million and required them to come up with 9 million in private funding, and we're providing 100, 000 per year and funds the art trance which is non recurrent, we created the department of military and veterans affairs and we took the division of veteran affairs and the governors and the military military affairs, people from the governor's office and we formed the division of military and veterans affairs. The housing financing see will get $20 million work for it's housing loan program on both years, the primary inadvertent administration will provide funding for the officer in human resource took pay and new applicant tracking system that combine compensation classification system for state employees and a program that will track state employee performance management and training. Other department of revenue provided money from the collection assistance fee that upgrade their e-services to the terms programs and provide maintenance funding for terms for terms in iTax, which are the tax programs. The department of entrance keeps a regular charge five and eight are 6.5% for calender year, the biennium, while for the calender year through 2016, and we've added the the authority to hire an actuary for the captive of this insurance market and the office of administrative hearings will get into trade of law judge to be located in Waynesfield. Some highlights from the special provisions the orbit system is getting $850, 000 to upgrade, the law judging Waynesfield,  they mentioned that hospital medical residencies were going to provide the intent on behalf of the general assembly to bribe funds at valley hospital to create and support additional residency slots for the medical students. Stop fraud and abusive tax payer dollars we're going to require the state auditor to report any fraud en-covered to the purchasing officer for vendors and what not and so we can start to get a handle on them some of these people who abuse our purchasing process and we're going to to remind the seize vehicle program for the state we're going to move it to the state surplus property agency from DPI this should provide about 450 to $500, 000 a year additional funds for the LEA's[sp?] and [xx] highlight to the general government budget. Questions? Representative Stan. Representative Cleveland I've been asked this in the new Department of Military and Veterans Affairs, how many positions will there be under the secretary? It'll be right about 70 that's give or take five there maybe six, we're not creating new Well I take that back, we have, I believe it was four new positions that we created. Thank you Mr Chair Hold on one second George. Any further questions? If not, thank you, next up is transportation You're ready for us Mr Chair, Representative Dollar Thank you Mr Chair, it's my job to put a framework on the discussion that we'll have about transportation today a couple of months ago we committed to finding a permanent solutions on how we fund transportation, we agreed that we need to remove the volatility within the gas tax solve the reductions in revenue due to declining consumption and attempt to catch up on the $ 35 billion shortfall that we have over the next 25 years needed to make our roads and bridges safer and support new infrastructure projects, as part of the budget we're presenting a possible solution here, is it perfect? No, but I would wage that there`re is no perfect solution where we`re going to fix this project where we

won`t leave anyone frustrated there`s always going to be someone that has a position that there not going to like about it but what we do in this is that we stabilize the gas taxing, creating new predictable formula we took into the account the act of the tax would have dropped a 30 cent, and met the consumer half way of 33 cents, and this would remain at 36. We spread the burden of investment, as evenly and fairly as possible by raising all DMV fees evenly at a rate just above inflation as these fees have not been touched since 2005, this charge affects businesses and individuals alike. The plan presented today also includes a comprehensive reform package for the Department of Transportation making us more openly responsible for the money our citizens have entrusted us with. We can not ask our citizens to help fix our infrastructure without ensuring we're getting the most out of every dollar. The plan honors the investment that we are asking of every citizen by making roads in every county safer, and modernizing our ports which will help to boost our economy. And while the reduction in gas tax will temporarily reduce STI by 12 million in 2016/17, it will increase by over 40 million a year starting in 17/18. STI runs on 5-10 year cycles, and this plan This is our overall investment in the overall in the current STI strategy as we go through the amendment process I hope that if you choose to offer amendment in this portion of the budget, you're offer competing plan to solve the problem we committed to address when we passed senate bill 20 and not just move back to the starter squil, it is tome we made a red safe where we invest in infrastructure where we support our economy, so in regards to the money report 80% of the new prone will go towards contract servicing port modernization will be 20% that 302 million to contractor servicing, 75 million to port modernization, refer one or two position to accelerate the review of new technologies we are through with the product evaluation program, we eliminate 50 position ans recommended by the governor budget complete the replacement of the legacy state amended driver license system shuttles to further modernize DMV drivers services I partner with agony to ensure the state marches available for in one establishes the $50 million reserve ion the highway transfer to pay for debt service associated with the passage of transportation bod and it's a 40 $4 million in additional funding to strategic transportation investment. maybe the provision just to hear a few on user provision the normal ones take question on they on May one will concern about the division of the STR scoring of the original and divisional level that the RPOs and MPOs a lot of people didn't have enough weight vs the dredging engineers so we instructed the [xx] workgroups they'll have to give the RPOs, MPOs greater weight in the vision engineers, not a 50/50 split like it has been in the same local input points to regional and divisional projects. So that means that we did not tell them what percentage was coming better than 50/50 percentage, going to the local They increased amount of the motor fuels tax agreed in the minor report. We established the DOT program, the report stands for responsiveness, efficiency, performance, oversight, restructure and transparency when the main thing's responsiveness was a 48 hour response to say he's planning to fic potholes all other road hazards will be addressed in 10 days and in th other efficiency a step use proceeds to drive down cost and performance conduct citizen survey on having conditions and employee surveys towards privacy meeting legislative directive outside changes DAT proceed to appropriation support so that we have outside there restructuring requires a step in an organization analysis of DOTs is how a division in restructuring and [xx] [xx] 13, 000 can get alon with 11, 000 employees transparency is quite significant website enhancement to

increase tracking project schedules budgets and raid closures remove the ferry replacement as stoodbof things remove replacement ferrys from the STI program and moved to the bridge langish program because replacing existing with a new ferry or doing maintenance is like fixing a bridge or replacing a bridge, new routs with new ferries will be, through the STL, like building a new roads. So it divides that up so that replacement ferries are not through with the STI. We should take a lot more time to accomplish if we have replace a ferry in that case. The motor fuel tax rate was decreased to 33 cents per gallon and maintains the tax rate for diesel at 36 cents per gallon. The DMV fees were increased across the board for inflation and establishes a $50 supplemental registration fee for hybrid and alternative fuel vehicles, increased a two year late penalty for overdue registrations. Licence plate agencies with perpetual contracts have been discovered that actually a 30 day contract that can be terminated in 30 days, so now the problem was to move to performance contracts of eight years with two 2-year renewals, and also increases the amount per transaction that the LPAs would get for the Tax & Tag Program. That's the highlights of provisions, I'll be sure to answer any questions on them. Thank you guys, it's. Yes, Mr. Chairman. I'm sorry, Chairman Torbett continue. Thank you, and just in a brief summation, ladies and gentlemen you've heard the story as we progressed through this interesting time in our state's history where we've had ports that have near closed, we've had inlets that have closed, we had navigational channels that would close, inevitably close our ports, we're addressing that. You've heard the complaints from our constituents about the ever rising cost at the pump, we've addressed that. You've heard from out across this state, no matter where you live in this state where you have your secondary roads starting to show very, very high signs of decay. We're addressing that. No matter where you live in the state this budget addresses your transportation your roads and your needs regardless to this place or that place. If you are in, as they say Murphy all the way to Manio we are the process, and I would add that as we resurface roads for every $5 million spent we actually get back a million that would be put into maintenance of those roads. So the long haul for this is a better access of the available monies, putting them to the best use for the people of North Carolina addressing everyone's roads needs and this would take effect for the next four years and we also have in place guidelines to over site about over site and to adjust as we go so we maximize our states potentials both economically and for the transportation network we all enjoy the people have asked for it and just bang out they deserve it. Do we have any questions Representative Stam? For Representative Torbett, I guess page three, there is a question I have raised here before so you could think about it. Item 19 reduces funding for 50 filed administrative positions quote to reach direct resourcing targets, which I understand, but if it's going to reach direct outsourcing targets where is the corresponding expenditure not necessarily one to one, but of some amount because if it's only reduction and then increase somewhere else what it means less work is going to get done, unless those 50 people were just tweeted on their firms. Thank for the question Representative Stam, I doubt highly they were just twiddling their thumbs, to answer that question first. This is the governor's recommendation, we're taking it and the money and the workload will be absorbed in turn of DOT as the governor recommended. Well, a follow up. Yes. Where will that be absorbed? Because if they're not getting directed outsourcing targets, who is doing that extra work? Mr. Chairman, I'm going to rely on Miss Cameron for a response from staff?   Staff is recognised.   It seems like she might have been

distracted by a member, but Representative Stam if you'd repeat your question for staff and we'd ask the member to quit distracting Miss Cameron. Item 19, and we discussed this yesterday so you're familiar with it. Who would be doing this work of these 50 people who would be laid off in directed outsourcing targets if it's just absorbed somewhere, where is the work getting done? As staff you're recognized Henry Cameron with Fiscal research, these 50 positions were included in the governor's budget after numerous requests to DOT, to ask for them to define these 50 positions they have refused comply and therefore the chairs don't know what 50 positions will be eliminated, and therefore I don't know what these positions could be, throughout DOT. Representative Amos recognized for a follow up. Yes that's an answer to a question I didn't ask. I'm not asking which positions these are I'm asking asking, assuming the positions are occured somewhere, where is the money to appropriate for the work that will be done by out sourcing next Representative Cameron with fiscal research these 50 positions were included in the governor's budget after numerous requests to DOT to ask for them to Representative Stan, the fact that the budget is silent on this means that, duty will need to Incur those costs internal towards existing budget Representative Michel yes Mr. Chairman, on a page K1 item 3, the production in state a municipal power what's happening here where is this monies going and trying to be madame chair. Am going to say assume its okay to answer. to the question Representative, statutorily when you adjust a tax rate, those fees are affected. It's every session that a question is asked whether they fluctuate higher or lower, they increased last year because we had 100 million additional dollars. This year we don't have 100 million so of course the funds come down a little bit so its statutorily plus its also attached through the gas our fuel tax right. We are bring the gas right from 36 down to 33 so that is evidence of the impact of the require. Follow up? Yes. I guess my follow up is that, couldn't this money still remain where it is and get a little bit more work with this extra money handed to it rather than reducing it. Excellent question, that's exactly what we are doing and it's taken a lot of money there is to get the whole more work done, representative. Representative Fleisure. Thank you Mr. Chairman, I want to follow up on representative Sterms question if I might Mr. Chairman. number 19 on page K3 and I think I'm beginning to understand it but if two parts of the question, one if you could directed outsourcing outlets are that would be helpful, so it wasn't in the committee and the other is, I understand that reluctance by any agency sometime to name positions but it seems to me, you know, at least for the first time I kind of looked under separation of powers and cheques and balances and all that stuff that they ought to at least department ought to at least have come to your committee and say well we'd rather pull it from, you know, office supplies or administrative costs but do we have any response at all for an item that is in the budget, it is about where this is going to be pulled from, a guess would be my follow up question what was the first part of your follow up question, what is that? Missing target. Okay, what would you have done in the past at least two years that we have practically looked at transportation strictly to the full size and scope and complement of the department itself and finding some savings and being more efficient and effective and expeditious and in those findings it's been determined that some things just by guller[sp?] you know the private sector can do better than government can, so we're trying to offload some of those into the private sector to the outsourcing model. When you do that of course a lot of people think that's a one to one return which it is not, but if you can gunner 10 or 15% savings or 5% savings or 20% savings in projects that size monetarily of transportation projects that's a huge savings that can

be applied to a different project, that's the outsourcing model we're trying to follow to a point we understand there's a point where I don't know that we've found that point yet but that's what we're walking towards. The second part is, we pretty much as you know going down to the budget we look at the governors and asked we look at the needs of the people that we represent and try to come together some what a budget this's one symbol that was offered by the governor and we just very much plug into ours. One follow up Mr Chairman. I owe up. Thank you and question comment, the question is who decides the outsourcing target would that be a legislative or a n executive provocative through the department and I guess the comment would be and I appreciate exactly what you're trying to do with the governor suggested though for a department to not indicate either to the governor or to the legislature when they're directed to where this money is going to be taken from oath to be something that's dealt with one way or another but that's another day. Not trying to answer a comment but try to address the answer towards your question your first question was related to? Who decides the target? Thank you very much to the department the appropriation process does to the budget findings they might be doing some of this internally as well that I'm not there day to day that's not my job they might be doing some of outsourcing internally that's just really never been brought to our attention but we're focusing on some of a larger size the scope to become more efficient more effective and more expeditious and so that would be to the appropriations sponsors, let me just interject a comment because I've got several people here to recognize remember what we want to do at this point is just ask information or question because so we make sure limiting anything that delves into debate because were going to have plenty of time for that also I'll just like a house keeping note we are in the process of passing out several amendments we think this might be ones depending on if we can finish share of the last few groups that we might be able yo deal with before 12:30 that would be the desire of the chair if we can do that but again if we can keep those questions to matters of of the presentation. Representative Pennon did you have a question? Yes, I'd like to just address the chairs of the one thing and representative Torbett and I have had this conversation, what concerns me that that we keep doing away with employees on the lower level now I'm going to take DOT because most of you know I used to be the number three person. Representative Pendleton I think there will be some time to debate that particular issue, in fact I'd feel certain of that, if we can once you have a particular question. Okay, I'll make it a question. Representative Torbet You know when I mean a question. Representative Torbet. I mean a question now is not technical now. It is not technical. If you'll have an opportunity if seeing the amendments Representative Martin thank you Mr. Chair, I will try to be respectful or your request to save debate for later. A question, I think Chairman Tarn talked about bridges and in our sub-committee we got lots of presentation on the deterioration condition of our bridges, what changes are made in this budgets to address that person in need. It's fully funded and as we move forward they'll be additional revenue to take care of those issues. The first step is we are going to make to make sure that our roads are safe then as we move forward we can also add that's additional money but the current program is fully funded and we'll continue to add money to take care of the budgets. Follow up. Yes sir, thank you Mr. Chair. Sir did I hear you say the part of dealing with roads in this budget and you hope to address bridges in future budgets. No, we have bridge funding in this current budget and it's fully funded on the current program. Additional investment that we are getting from additional revenues start with the two programs supports and the road resurfacing and as we address those issues we have more money to move into other items as well. Mr. Chair, a question on a separate matter if you permit.

Additional question Thank you Mr. Chair, next question is in the special provision against page 243 down to the bottom the provision on outside counsel I'm still trying to understand what benefit we're seeking to get to the tax from that provision. Mr. Chairman thank you, I'll be happy to answer that question. Yes a lot of the issue that we address in transportation are specifically transportation related we want to give them and the people of North Carolina the best probability of outcome. So we are allowing transportation to go outside of the (xx) I guess there will be the attorney general's office that has some usually poor transfer vacancies paced specific later guidance to address major North (xx) additional part. Follow up Mr. Chair. One thing I follow. Thank you Mr. Chair, we look at provision I don't think it talks too much about special transportation claims but instead talks about workers compensation plan which is a very broad here the law of it goes outside the transportation so I don't know of a understand your response. Yeas it seems the transportation, I'm sure they covered a million of details in terms of that, but specifically the dissemination coming from the department transportation of which that would be one. Representative [xx]. Just a quick question Representative Torbert as far as diesel tax and fees just a quick second on the logic on where the diesel tax ended up being here versus where maybe it could have been in regard to these increases? I think the easy answer is, they could be all changed, they could be anywhere. It's just a mathematical process that we came in after months of looking at, investigative looking at how do you fix the needs of the people of North Carolina into transportation network from one end of this state to the other end of this state. We're working through STI on new projects, maintenance and repair of our existing roads they were doing the best they could with the dollar they had available, so what we are going to do we are going to put much [xx] on the road and address those needs of the North Caroline citizens and this is just one mathematical equation that brought us to those ends. Representative Queen. Yes. Thank you. A couple of questions. First one, is there a new fee being added, a short charge for energy-efficient vehicles? Did I hear you say that? Yes. This turn of the budget, last year, last session, electric vehicles were added and this year, hybrids were added I do believe. What is that fee? If I could. We looked at hybrids as a possible source and in the end the decision was made not to include hybrids for a specific fee. There was not one that allowed. OK. So we don't have one. Follow up? Follow up. Let's go to staff just to make sure. We went through several revisions as we went through so let's just make sure. All of this were researched, Rep. Turner's correct. There is no supplemental registration fee for alternative fuel or hybrid fees included in the provisions. Joe Sam, I was wrong. Thank you. Thank you your question is no. It's a good step there. Second question if I could. Representative Michelle you have a follower? Yes I do. Follow up. Am just trying to get how much, we talking about doing more across the state, particularly in our role is where we're appealing the need for roads, and bridges maintenance, and repair and resurfacing. What are we adding to this badget for doing that, to get that done, a lot of wonderful things, just saying. Can you be more specific in term of dollars I guess.  Close to rounding up $300 Million. So this budget has about 300 Million more. Specifically addres the to re-surfing of roads and port modernization in effort to keep them from closing. Rep Micheil Yes did I I miss something did I understand you say that funds in here to here outside council Rep. Michele Yes a higher outside council for work was compensation clean did I hear that correct  not for worker compensation to allow them a higher outside council one issue of which might be

worth the compensation claim. May I follow up on that. Follow up I thought we already had council and in house council take care of workers compensation particularly on workers compensation claim why are you putting sending that outside the preview of the attorney general's office. Representative Mitchell it seems that one category has been hanged up on, there was no and to specialize on that the overall is just provide them access to outside council on maters fuels to transportation Miss Michel if you read the provision I have seen you have but the one if their is any project under taken by the department and number two is fishing so any project is less to first and then order conversation just doesn't add on well Mr Chairman Follow up Rep. Michel you just added their is not a passage to this thing would their be any conversation as to whether or not outside council should be hired another with the attorney general office anybody like that on the inside council [xx] if you would like if the chair would like we can have staff of chairman time  DOT made the request is was one of when you start the back process they say they would like authorization to allow flexibility that when we feel like we need expertise of outside council, we can go and do that, so it was not meant to be a general broad we are going to outsource all attorney it was an authorization in order to broaden what they can go to outside counsel for if they feel the need to so I normally don't interject up here but I do know that for example form a project in my area have been issues in which have needed some very specialized counselling in order to be able to determine the state of legal issues and have the appropriate advisor for the DOT to move forward or to change what they're doing or not do something. Mr. Chairman, my point was whether or not they are going to do it on their own or are they going to do it with the consultation of somebody else? We'll take that offline and chat with staff about that. Rep. Glazier. Thank you. A different provision, Mr. Chair. This is on page 256. It's item 29.27. It says the division of aviation of the Department of Transportation may use funds appropriated to it for time sensitive aviation related economic development projects. My two questions are, do we have any time sensitive aviation related economic development projects pending, and second, how much money is in the division that we're giving them authorization to be flexed with? Let me get the second as far as if I could go to staff with that amount Byrce Alright further. I'm sorry. [xx] with physical research Mr. Chair proceed, currently the division of the aviation since it got $19.2 million for state airports within the money report they are receiving half a million on top of that, and of course the provision simply make these types of projects eligible, for which funding was directly provided for a project of this kind and look at the principle of PTI in the portal. And I ask the last part of question Representative [xx], should something that comes variable that airport or economic engines as well, I go often over look on such it just provides some kind of flexibility should accompany anything comes in and to set a good plan up in any of the minute of the airport across the state and there is some flexibility there to allow that to occur further questions? Seeing no hands, thank you very much, re shed presentation next up, Capital. I would also just mention to you, I think I might have mentioned a moment ago, we have passed out some amendments, and when we finish our final two committees will see where we are at here. Chairman is ready now. Chairman are recognized. Thank you. Mr. Chairman. Really capital straight forward, one on government, just couple of budget priorities, what we wanted to do is align the financing with the asset life for instance if you use in 20 year money, we wanted to make sure that it was a

long term capital asset and use cash for regular renovations and so forth so we align the financing, with the project tight. Another priority that we have was we wanted to leverage state funds, to maximize the match of outside forces and money and appropriation so we can get the biggest bank for a box there, we also wanted to focus on the capital dollars that boosted the state economic activity, for instance if got $10 in capital here but you can spend $10 over here and get an economics activity we choose this side over here to get the economic activity, and finally this was a senior understanding of the partnership between university and industry and so fourth, and finally we have the significant effort for repairs and renovation, and really want to try to develop a physically responsible plan and commitment to taking care of repairs and renovation needs of our state assets, then you can see items in there is going to be an amendment brought forward later on for something but I'd forward Chair to go over that Thank you Mr. Chair members of the committee I want to talk about 2/3 of board financing for budget provides $269.5 million and 2/3 board financing should the general obligation board not be passed on May 2016 for the following project, how we patrol training academy and rolling $30.7 million DHHTS medical examiner lab and Wilson Sailum $30 million NC state engineering building $65.1 million UNC Shower new since this building, $90 million approach in state health, sciences building, $7.7 million. Questions. Thank you Mr Chair. I almost got away Representative questions be for the chair, Mr Chair, would it be okay to allow the Sergeant of Arms to pay alert to have to stoop over when they are walking back and forth causing it's just, I don't know. Well, that's a good point the Sergeants at Arms are trying to be courteous to the members, but they certainly have free range to do what they need to do thank you, questions for capital. Thank you Mr Chair, if not, thank you for the report IT Thank you, Mr Chairman. We'll try to be as brief as possible. I know that folks like to gloss over and their eyes like to glass over when we bring up IT, but this is important. The budget provides over $84 million over two years to improve the operational infrastructure for State Information Technology Services, state information technology resources. It continues previous efforts to providing funding to support the operation of the Office of the State Chief Information Officer and the Office of Information Technology Services. At the same time, funding of $2 million is provided to plan and implement efficiencies needed to improve the operation of the state's IT organizations. The IT Internal Service Fund which is supported by receipts from state agencies, is reduced by transferring functions which are more appropriately covered by the General Fund. This reduces the annual cost to state agencies for their IT services from 195 million each year to closer to 180 million dollars, an additional 8 million is provided for the government data analytic center known as GDAC to continue efforts to improve the state's understanding and effective usage of the data it maintains. Funding of approximately $4.5 million is provided each year for IT modernization, to improve efficiency and customer service in the state. This includes funding for dual factor authentication, which law enforcement agencies need to operate effectively. As well as increasing the availability of mobile after state agencies. Security concerns are addressed with over $4 million appropriated each year, to continue improvements to protect the state antique infrastructure and data. To prove the state's economic development capability a partnership is being established with

The University of North Carolina at Charlotte, UNCC will work with state agencies to provide dynamic modelling to support their effort to recruit business to the state at a cost of $500, 000. Special provisions address improvements in the state's IT operations and IT Architecture are required to be developed, state security requirements are enhanced, project management and IT procurement are improved and the state CIO is required to standardized hardware and software for state agencies, that includes a requirement for a data center consolidation plan as well as a comprehensive strategic plan for where consolidation makes sense with an act [xx] self assessment, clear articulated goals and a plan on how to achieve those goals, Mr, Chairman [xx] any other questions? Like it. Thank you so much, do you have any questions? We don't know and never got technology to ask any questions to representative Stam. Thank you madam chairman. Thank you we do, Jose Ham Queen had them at kun[sp?] theater. We may not but I'll ask the question anyway. Thinking of technology needs across our state in some of the comments you were just making in your presentation one of the things is smart grids, grids that are efficient or just had presentation for transportation and using IT to improve transportation outcomes and efficiencies of roads. And then in clear signal letting trafic flow in our urban areas in everywhere there`re signals and I`m just amazed at every traffic light intersection, there is a big stainless steel refrigerator, you can hang on the side a beef in to turn on 5 or 6 lights on and off and I don't think it has any Inner graded smart grid capacity and it seems like that it's so so backward for our state is there any look in the things your trying to do to improve efficiency with before our network particularly transportation but could include water, sewer, garbage collections a lot of those things that Mr chair if I can, Thank you representative Queen so as you look at the portion of the budget that talks about the You have a development capability that partnership with Charlotte palacy using your data in the lead centre which allows to visualize the IT I was at the commitee last year we took a field t4ip we had our meeting there against Charlotte campus which is how we found out about that capability there but what we're able to deal with visualizing the data analytics and putting in so many different data sub steps, allows you to make transportation decisions things like zoning healthcare facilities, healthcare needs, socioeconomic status of residents there, where you can't start to develop overall plans in a much larger fashion so better data in and better data out will give us a possible better opportunity make better decisions we hope, as we look at that data, so that kind of touches on what you're talking about, it puts us at a place where we start making those decisions in the right way, so it's a great question thank Representative Coing'. Further questions from committee members. If not Chairman Sam thank you very much for your report. Thank you Mr. Chairman. We will proceed at this time into the amendments. I'll also mention something while I'm thinking about our try to remember a little bit later it will. When we leave at about 12:30 or so the room is going to be locked, so you want to leave something here it's going to be locked, but if you think you're going to need it sometime before we come back after session it's going to be in here locked up, so just bear that in mind before we move to the first amendment Representative Stam. Was there any discussion of reserves or is that for later, that I may say? We'll have that discussion later, with this let's move in to some amendments right now, and we'll have the discussion that was asked when we come back. The first amendment is offered by the chair it's

amendment 37, amendment 37 offered by Representative Dollar. I don't have it. You should have it, it should be out. They're not numbered. Mr. Chairman. If you would give us the H97 number we could tell which one we have. Well it should be 37 at the top and the number is ALU-8V2 alright, chair stands corrected the amendment number that we have available that she did not have available to user we won't refer to it by that This amendment is chairs technical amendment first section that's some language that was inventively amended on second section reviews removes the duplicate provision relating to principle pay, a third provision is about language to distinct part of the bill for salary increase in the state agency and department and some institutions and the fourth last so on the section correcting section numbers. Any questions? Yeah Mr. Chairman.   Representative Michel what amendment that is again is that the AOUA version two. Yes sir. OK. Questions? Representative Geoffrey. Thank you Mr. Chair, what is the part of the bill with the principal pay what is it? specifically say. It's removing a duplicate provision relating to principle pay, in other words it's a provision there removing a duplicate section. Other questions? If not all those in favor of the amendment say Aye.  Aye.  Oppose no the Aye's have it and the amendment is agreed to. The next amendment offered by Representative Dopson ATR-5 version 6. ATR-5 version 6. And Rep. Dobson is recognized to present his amendment. Thank you, Mr. Chairman. This is a study amendment, study Medicaid coverage for visual aids. It directs the Department of Health and Human Services with the DMA in consultation with the Department of Public Safety to submit a report to the Joint Legislative Oversight Committee. It contain analysis of fiscal impact to the state of reinstating Medicaid coverage for visual aids for adults utilizing a contract with the Department of Public Safety to conduct dye glasses at Nash Optical Plant and Optical Laboratory. So basically it's a study to see if it's cost-benefit or not with regard to coverage for visual aids under DMA. Alright. questions seeing none all those in favour with the amendment please signify by saying aye apposed no the ayes have and the amendment is agreed to the next amendment is offered by Rep. Brian Brown, ATR-11 V three, ATR-11B3 and Rep. Brian Brown is recognized to amendment thank you Mr. Chairman members this is a little bit lengthy explanation so if you indulge me in 1993 the state of North Carolina approached then pet memorial hospital asking them to create what is a another lasting a very successful public private partnership and assisting the state with providing funding for the administration of the residency program at the veterinary school of medicine at the pet memorial hospital, in exchange for doing so the state agreed to 100% outpatient reimbursement for services performed with medicaid it does a couple of things for roundly obviously it's additional revenue from the state that allows for additional federal draw down allowing them to offset the investment that they make into the broad school of medicine for the education of the residency program in the last budget cycle we reduced that from a 100% to 70% thus creating a much greater demand on violent medical centre in continuing in this very successful private public partnership members this is roughly $3.4 million of investment from

the state to a private organization that yearly invests over $50 million into a state run agency that is a an amazing return on investment considering some of the things that we do from an incentive perspective in this body. I urge the members to support the reinstatement of this so that they can continue the mission of assisting the state in educating our medical students in East and North Carolina, and providing the best primary care physicians this state can produce, who stay right here in this state and practice. And before I recognize anyone else, I do want to, instead of a two minute warning, it's a five minute warning. There is a five minute warning if you have any other amendment request, you have five minutes to make those requests of staff. Representative Dobson is recognized. Thank you, Mr. Chairman. Appreciate Representative Brown bringing this amendment forward, it does take funds out of the State Facilities shortfall. However, it will leave 5 million in there to at least move us in the right direction, and at the same time hopefully resolve this issue. So, the Chairs have no objection. action and would encourage your support. Further discussion further debate on the amendment, seeing none, all those in favor of the amendment please signify by saying Aye. Aye. Oppose no, the Aye's have it and the amendment here is adopted. I have an amendment by representative Faircloth AMD-21 version four. Mr Chairman. Representative Faircloth is recognized. Mr Chairman request that amendment be withdrawn I'll handle it on the floor. The amendment has been withdrawn the next amendment is offered by Representative Lamberth, Chairman Lamberth ATR-7 v 4 ART-7V4 and Representative Lamberth is recognized to explain his amendment. Thank you Mr. Chairman, there are funds in the budget for the HIE, the Health Information Exchange, this is clarifying language to make sure that it's clear, that those funds are to be used for monthly operating expenses and not to be used for other purposes within HIE. Questions? Seeing none all those in favor of the amendment please signify by saying aye opposed no the ayes have it the amendment is known. Next amendment is offered by representative Hailey it is AMD #13V6AMD-13V6, Representative Hurley is recognized to explain her amendment. Thank you Mr. Chair. This budget this year we have included DNA samples for all violent felonies, this is just to have a study of the oversight committee committee to study Justice and they do legislative oversight committee and Justice for private safety to study extended this to persons arrested for any felony in this, I hope you're willing to prove this. Questions on the amendment? Seeing none, all those in favor of the amendment please signify by saying "aye", "Aye". Oppose "no", the "Ayes" have it, and the amendment is adopted. Next amendment is offered by Representative Whitmire, it's AMM-81V2 AMM-81V2, Representative Whitmire is recognized to explain this amendment. Members of the committee explained this as a technical nature, I think it was the intend of the Chair, so I've been told to have used 1 October, 2015, and say that they published our staff there unless there's a question. questions, Representative Pittman. Not really a question just want to point out a misspelling, don't know if it matters that much this is be deleting instead of by deleting. Well then, when we did the final we did the final motion it gives staff leave to make technical and grammatical changes as necessary, as they may or may not be necessary.

Mr. Chairman? Further? Representative Martin. Could the record note that that was an Air Force Academy graduate that made the mistake in his amendment? since my grandfather and my wife's father, my father-in-law is in the Air Force, it will not be noted. I have to visit every once in awhile. Alright, the amendment, Any further questions on the amendment? if not, those in favor will signify by saying Aye, "Aye". Opposed No, the Ayes have it and the amendment is adopted. The next one is, well let's do my own. Representative Dollar, his consolidation of AEME EMCOs, this is ATR-9V6, ATR-9V6 and basically what this amendment does, it's kind of an update of an amendment we've had in there before where we are we are strongly encouraging, maybe that's the way to put it, as strongly as we can for the LME MCOs that need to move forward with consolidation to consolidate, and if there's a lot of questions I probably will have somebody else Chair for a moment. Questions, Representative Insko. Thank you, Mr. Chairman. I wouldn't oppose this because if it didn't require it, you're saying it's strongly suggested that they shall consolidate so I I guess I prefer for the LMEs to be able to work through this because I know its been very difficult at some point and we've made so many mistakes I hate to do anything that we're not absolutely sure of In response, the lady's concern is well noted. The reason why we believe this amendment is necessary is because we have been moving forward with consolidation we want to make it clear, frankly to the department as much as to the LME MCAs that this is a requirements, we need to move forward with the there are LME MCOs they know which ones they are, they've got to move on with that process and we've got and have a conclusion to those consolidation frankly that we can move on with some other initiative within the LMCOs and the we have been patient and we had been encouraging and I think doing everything possible to move this process along and I believe this is the next logical step to make this to try go a head and happen and get it done and over. Representative Glacier Mr. Chair this is just a follow up and I just want to make sure I understand the language because I don't disagree with what you are saying at all read this to say that the shall consolidate it and right first is opposed to sibling encouraging says an extra that is the language we're looking at yes sir and I apologize if I was not clear about that, thank you. Further questions, Representative Shephered Thank you Mr. Chair I want to ask I get some, I'm a little confused my current commission Chairman called me past week and they were concerned about this because so we used we can consolidate it and also we can include it through the only means to being involved in one of the, but not in counties and nightmare for the needy health patients and that reason and so there is concern about this preferences pushing them of forcing them to do this and your problem has something so large, that they will not have a voice of any input so ever, so I don't know if I'm with the question do you but I'm fine some I understand this law Chairman Dollar. I believe currently is either and coastal or ECDA and any eventuality they already have the agreement and ready to go for the consolidation of those two are the MCAs those this really wouldn't really in front of them because they maybe a hand with this consolidation. Alright and what I

got concerned Chairman  was it, they were told that you will do this, and she said there are one of the available approval, saying you are going to do anyway, so the question will not, this was amended and if so it had to a little in this board, so maybe I'm still confused I don't know. With the boards and the board will vet on the consolidation but I do know in that particular consolidation in my understanding of years it might no any particular person is happy but I do know that it has been applicable joining together those two MCAs for the most part and frankly we are just about t and their process. Representative Hines can I apologize? I just I'm going to fall against the amendment pertly because the consolidations has been most successful, has been the ones that has been alowed to work out on their own, one of the big problem with these consolidation is that on every county commission we have a Representative because we want the county commissioner to add local money but it's a health and human service to their citizens, and when they don't have a voice on the board, they are less likely to put money into providing services so if we have 20 counties and we have 5 LMEs, we're going to have a lot of, in those fords are too big and so some of the counties are not actually able to to have appropriate representation on the board, so I think this just needs a little bit more thought and I actually personally would prefer to have no fewer that seven LMEs but, this will give me, if we, I'll vote no in order to just express my concern about it. Representative Valler[sp?]. Thank you Mr. Chair, is this a big enough change, a change in this amendment a bid enough change to the no plan hospital association has a position on this? I'd be shocked if they did, to my knowledge they have no position on this issue. It doesn't involve them. Not directly anyway. Further discussion for the divided amendment, all those in favor please signify by saying Aye, Aye Oppose No No The Ayes appear to have it. The Ayes have it the amendment is [xx]. The next amendment is offered by Representative App and that is AMD -15V3, AMD-15V3.  Thank you Mr. Chair. The amendment does jut a couple of things. It really dovetails with what Representative Harley's amendment was at provided a study for the state water acquisition for DNA samples for all the felonies, what this does, is that we had appropriated an expansion of the facilities, in order to do that. What we want to do is the facilities plan to follow the policy, and so therefore we're going to be re-appropriating until that study is done and tell me what the needs are we're going to re-appropriate those to $9.2 million for the Western Carolina, and then sciences and stamp facility planning and $5.8 million for the school's science and maths building prepare for an upgrade and so what we want t do is make sure that the facility's plans follow the policy question Representative Stan. Representative Conrad I introduced the bill to collect all the DNA from felonies and we'd love to see that done but I don't think that's the reason to build the state crime lab I mean the first function of government is to protect people from criminals, and we've got a big backlog of existing things that need to be done. We got forensic analysts travelling all over the state when they should be in their labs. I don't get this and I'd appreciate more information, the study would be for a small segment of what the state crime lab does. If can respond, what this does is that, it's determined that

with the DNA that is being proposed to be taken for the violent felonies that can be done within the existing facilities and laboratories. The expanded laboratories are not needed until the DNA is taken for all felonies. Further question Representative Glazier. This is a follow up and I just want to make sure that I'm understanding this, to representative [xx] question, so I'm reading that this is taking all 15 million out the state crime lab facilities fund and then reallocating it to these two the technology upgrades and the new science and [xx] facility, is that correct? No that's not correct. OK. What this has taken out is in the capital appropriations, there was $15 million appropriated to expand the building, the facility in order to provide for additional laboratory space to process all the DNA for all the felonies that's not what the state is doing, that's not what is being proposed and so what this does is re-appropriate those capital needs, it does not get out of operating funds or anything of that nature it's out of the capital fund. Follow up please Mr. Chair. Follow up. But it is taking the 15 million page M1, the 15 million capital that you put in to provide for increased state crime lab facilities capacity in reallocating it here, am I not correct that there are large capacity issues way beyond just the DNA testing increase that have been sitting there for years to try to get at euro15 million could have gone for, is that now I won't, this is essentially taking any capital improvement money out of the state crime lab facilities that you, I think correctly had put in. Is that not correct? no, we put this is in, in direct coalition to the DNA collection, of that enunciate If I may just for one further clarification, and I apologize to Chairman all because he may have said, I may be repeating something but for a moment there, the initial analysis that we had was that the DNA on the from the, that would be collected from violent felons and where others maybe if there's future legislation was going to need to be preserved by the state, in the same way that we have lab facilities currently where we preserve the rape kits and you may have to have trained federally certified personnel, it has to be climate controlled, it has to be secured, all the legal securities Representative Glazier for me with that, and so initially that's where, as chairman Harp indicated, was where the request came from, from further clarification, what we understood was that what's required in this instance the bill that's passed is that the material comes to the lab, it's tested but it's not preserved by the lab. Obviously the tests are kept here, but the materials, the evidence is sent back to the jurisdiction for the disposition of whatever trial or court matter it may be, so in other words, what was initially, you may be talking about other capacity, but I'm just referring to referencing the capacity that initially gave rise to the refunding request that wasn't determined not to be needed. Mr. Chairman. That helps. Representative Stam. If I could ask if perhaps if work would hold this for the floor so that we could check into it the numbers are not matching up, for example, the violet only doing the violent ones is about two or three hundred thousand dollars a year build that representative Canes to collect all the more followings was going to cost like five or six million and it was dead as a door nail in a hospital committee. So I don't know why they would have proposed an entire crime lab to do something. I mean, it's just it's not matching up well what we can do is we can,

I think we can have some additional offline conversation, we can displace this amendment until later next amendment is for the staffs record is 45 it`s representative Elmore A_23V3 AMK_23V3 and representative Elmore recognised to present his amendment. Thank you Mr. Chairman, this amendment will re-write the language of this item to it's original form and intent to ensure that funding of some of our staff development goes through our reassess it will allow for different course offerings at the regional level. This is very very important to teachers as they still have to meet the subject specific training requirements for the licence renewal I ask that you support the amendment representative Pinlton. Yes sir what is LISA. If the gentleman will like to respond they are called regional educational service alliances, they deal with [xx] for teacher further questions, comments on the amendments. Representative [xx]. Question, are we increasing funding and not relieving funding somewhere else in this amendment. Can we do that? It's our understanding from staff that staff wishes to respond that this is within the rule but I think it's not doing what you're doing can staff respond to that question to representative [xx] gentleman is recognised Thank you, Mr. Chair. Kris Nordstrom from Fiscal Research. This amendment from Representative Elmore would simply change the snappy language for, sorry I've not had a copy of the amendment before me, this snappy language on page F4 number 22. It just changes the snappy to indicate that the money will be going to the recess[sp?] rather than the state board. Alright, further questions? Chairman, if I? [xx] OK, alright. Further questions? If not, all those in favor of the amendment please signify by saying Aye. Aye. Oppose No. The ayes have it, and the amendment is agreed to. I have Amendment number 40 for the staff, offered by Representative Insko, AM C-42 V5. AMC-42 V5. Rep. Insko is recognized to present her amendment. Thank you Mr. Chairman. This merely directs the Department of Administration to study ways to memorialize Dorothea Dix , now that we've sold that property, there are considerable memorabilia there that we need to find a permanent place for and also other artifacts and pictures that're in various places around the state and this would direct them to also collect those. Appreciate your support. Questions, comments on the amendment? Rep. Cleveland? A comment. I totally support this amendment in light of what the state has done to Dorothea legacy, we have to make sure that she's remembered in the future. Further comments? If not, all those in favor of the amendment please signify by saying "I". I. Oppose no. The "I"s have it and the amendment is agreed to. Members, at this time, we were planing on breaking at 12:30, but since we do not not have any further amendments distributed at the moment we will break a little bit early and please be back here 15 minutes after session, sharp if you will, because we want to dive right into working through the balance of amendments that we have also remind you that, the doors will be locked, so you can leave

stuff or take it, but they will be locked while you are gone. Thank you very much