JANUARY UPDATE

As directed in the adjournment resolution from October of last year, lawmakers gathered in Raleigh on January 10th, to gavel in for what became a one day-long session. The anticipated reason for their return was to address judicial redistricting, the method for selecting in North Carolina, and several proposed Constitutional Amendments. However, leadership in both chambers had previously noted that neither of those matters would be heard when lawmakers returned.

Prior to the session, it appeared that the two chambers could potentially pass a bill to address the “GenX” situation in the lower Cape Fear River basin. The House did, passing House Bill 189, Short-Term Response to Emerging Contaminants, unanimously. The Senate however, expressed no immediate interest in advancing the measure and adjourned prior to receiving the proposal from the House. Lawmakers did confirm several gubernatorial and legislative appointments to various boards and commissions.

Lawmakers technically have not adjourned as they continue to hold no-vote “skeleton” sessions every few days, as they may need to return to address any of several matters currently in litigation, if needed. One of those matters is potentially redrawing the State’s current congressional districts, which were recently struck down by a federal three-judge panel due to partisan gerrymandering. Lawmakers redrew the State’s congressional districts in 2016 after the 2011 congressional districts were struck down due to racial gerrymandering. Legislative leaders requested a stay from the lower court, which was denied. The U.S. Supreme Court however, granted a stay. Other important matters pending before the court include the legislative redistricting and the cancellation of judicial primaries. The most recent schedule update is that lawmakers are not expected to return to Raleigh for a voting session until February 7th, although that could change.

Eligible matters lawmakers may address include:

Revising the Senate and House legislative districts;

Revising the judicial divisions of the state, the Superior Court districts, the District Court districts, and the prosecutorial districts;

Revising districts for cities, counties, and other political subdivision of the State;

Constitutional amendments;

Veto overrides;

Appointments or confirmations;

Bills responding to litigation

Adoption of conference reports;

Bills affecting the budget;

Local bills that met crossover;

Bills relating to election laws.

Bills returned on or after Wednesday, June 28, 2017, to the chamber in which the bill originated for concurrence.

INTERIM WORK

Most lawmakers have returned to the NCGA periodically for interim Committee work since they adjourned their last special session in October. Interim and Standing Oversight Committees have been meeting to address possible policy proposals affecting education, transportation, judicial reform, healthcare, agriculture, and the environment, among other subject matters. The interim is generally the time where lawmakers hash out the preliminary versions of complex legislation they plan to address in the short session, which begins May 16, 2018.

Legislators wrap 2017 work with interim oversight committees – NSJ

In terms of news coverage, judicial reform has been the predominant story during the interim. House and Senate leaders appointed a Joint Select Committee on Judicial Reform & Redistricting to review alternative models for selecting judges, as well as making changes to the current judicial district maps, which have not been redrawn in decades.

Constitutional concerns may force legislature to redraw judicial districts – Carolina Journal

Currently, judges are elected, but potential reforms could include merit selection of judges, with appointment by the Governor or by the legislature. Any major changes would require a Constitutional Amendment that would go before the people on an election ballot for final approval. The Senate had already appointed a similar Committee that began reviewing this matter at the end of last year. Leadership hopes this Committee will be able to form a proposal that will be agreeable to both chambers.

House-Senate panel looking at judicial maps meets again – N&O

The majority of the focus of the recent healthcare discussion at the NCGA has been on Cardinal Innovations. An audit of the LME/MCO, which manages behavioral health Medicaid patients for a region of the State, found excessive spending as well as higher than allowed administrative pay among other problems. The Department of Health & Human Services dismantled the Board of Directors, ousted the CEO, and appointed a new governing board. HHS Secretary Mandy Cohen has urged lawmakers to expedite the timeline for integrating behavioral health into the overall Medicaid transformation. House Bill 403, entitled Behavioral Health and Medicaid Modifications, is currently in a Conference Committee and addresses this issue as well among other related matters. If conferees reach a compromise and produce a Conference Report, the bill may be placed on the calendar under the rules of the adjournment resolution.

How NC failed to protect millions Cardinal spent on big payouts, parties – Charlotte Observer

NC taking over embattled mental health agency Cardinal Innovations – Charlotte Observer

NC lawmakers want Cardinal severance back – from executives who got $3.8 million – Charlotte Observer

The Joint Legislative Task Force on Education Finance Reform began reviewing how NC currently funds its K-12 public school system. The Task Force was charged with studying “various weighted student formula funding models and develop a new funding model for the elementary and secondary public schools of North Carolina based on a weighted student formula.” While still in the early stages of their discussion, the Task Force could make a recommendation for legislative changes for the NCGA to consider during the 2018 short session.

LEGISLATIVE REDISTRICTING

As we begin 2018, and the candidate filing period approaches, the lawsuit over North Carolina’s legislative districts remains unresolved. In August, lawmakers reconvened to address the 28 House and Senate districts found to be unconstitutional racial gerrymanders. Following their review of the newly drawn maps produced by the NCGA, the federal three-judge panel still had concerns with seven House districts and two Senate districts.

The panel chose a “Special Master”, Stanford Professor Nathaniel Persily, to produce alternative maps, which he has since unveiled and revised. His initial changes had several instances where two or more sitting members were “double-bunked” or placed in the same district as one of their colleagues. His latest revision however, limits that scenario to one instance in Guilford County, where Sen. Trudy Wade (R-Guilford) and Sen. Gladys Robinson (D-Guilford) were double-bunked.

House and Senate Republican leaders have criticized the proposed changes and argue that the process has been politicized with the new maps designed to help elect more Democrats to the legislature. Conversely, Democrats argue that maps drawn by Republicans were designed to maximize the number of Republicans in the legislature.

The three-judge panel has ruled to implement the maps drawn by the Special Master, which would be effective for the upcoming 2018 election. Lawmakers will appeal to the U.S. Supreme Court and have requested a stay from the Supreme Court on the ruling from the lower court.

How far into 2018 before NC knows shape of election districts in gerrymander case? – N&O

While analysis of the new maps does suggest that the changes from the Special Master will be more favorable for Democrats, it is unclear if it will be enough to break the veto-proof majorities Republicans wield in both chambers. In order for Gov. Cooper’s veto to carry weight, Democrats must break the veto-proof majority in at least one chamber, which requires a net gain of either four seats in the House or six seats in the Senate. In order to flip a chamber, Democrats would need to pick up either 16 House seats or 11 Senate seats.

Legislative Democrats are optimistic, touting recent candidate recruiting and hoping for a Democratic wave. Historical trends tell us that the political party opposite the President traditionally fares well in a midterm election. However, there is no high-profile statewide race at the top of the ballot in North Carolina to energize either side, which will have an impact on electoral turnout. Which party that favors is unclear.

NC Republicans and gerrymander challengers seek Supreme Court intervention. They want different things – N&O

‘We have learned from our mistakes.’ Republicans, Democrats switch places on idea to stop gerrymandering – N&O

IN OTHER NEWS

In economic development news, Forbes Magazine has ranked North Carolina as top state for doing business in the U.S. CNBC highlighted NC as the top target for Amazon’s second headquarters “HQ2”, and Amazon announced that Raleigh was included in the narrowed list of 20 cities. Raleigh was the only NC city to make the first cut.

North Carolina Heads The Best States For Business 2017 – Forbes

CNBC pegs North Carolina at No. 1 in Amazon HQ2 derby – TBJ

NC did lose the joint Toyota-Mazda plant to Alabama. The package reportedly offered by NC totaled more than $1.5 Billion in incentives, dwarfing Alabama’s $380 Million. However Alabama, which already has multiple auto manufacturers and sits in a region surrounded by several others, had a key advantage in having an existing supply chain in place.

N.C. Commerce: State was prepared to offer Toyota-Mazda $1.5 billion incentive package – Triad Business Journal

HANDY ELECTION TOOLS

The North Carolina Free Enterprise Foundation, which does an excellent job covering the logistics of North Carolina’s elections, has several resources to keep you up to speed heading into the 2018 election cycle

2018 Candidate Tracker – See the most up-to-date list of who has announced a run for what office. Candidate filing begins next month.

Legislative Districts Affected by Maps from Special Master

2018 NC General Assembly Retirement Tracker – Most up-to-date list of current NCGA members who have announced they are not seeking reelection in 2018.

IN THE NEWS

Legislators wrap 2017 work with interim oversight committees – NSJ

Year 1 in the books for Cooper with mixed results – WRAL

These 26 North Carolinians left us in the past year – N&O

Year-end Wrap: Highs, lows of NC politics in 2017 – WRAL

North Carolina revenues not far off midpoint target – AP

Court says merged elections/ethics board is constitutional – Carolina Journal

Judges elaborate on decision to dismiss lawsuit over NC elections board – WRAL

Gov. Cooper must give fired state workers their jobs back, judge rules – N&O

Cooper not giving up on stopping latest GOP tax breaks – N&O

Metal Detectors at N Carolina Legislature Could Come Soon – U.S. News

County tier system dictates funding – NSJ

Saine tabbed to chair American Legislative Exchange Council – Lincoln Times-News

NC homeowner insurance increase on hold ... for now – Star News

Attorneys: NC court fees are unconstitutional – WRAL

Lawmakers Press for Reform of NC’s Struggling Foster Care System – NC Health News

North Carolina a leader in state vouchers for private school – WRAL

Legislators grapple with science, scope, of industrial chemicals in NC water – WRAL

DPS chief promises more safety, better work conditions in prisons – WRAL

Newest GenX Lawsuit Attacks DuPont Science – NC Health News

County tier system dictates funding – NSJ

Long-forgotten speech Sen. Jesse Helms never gave would have changed American politics – N&O

Supreme Court decisions defy simplistic partisan spin – Carolina Journal

Forest, energy council talk EMPs, power grid – WRAL

New power of attorney laws take effect Jan. 1 – NC Lawyers Weekly

N.C. in the middle among states in regard to occupational licensing, study finds – Carolina Journal

Hemp’s first year on North Carolina farms wraps up, a lot was learned – SE Farm Press

The Nexsen Pruet Public Policy team provides attorneys and clients with a newsletter summarizing the week's activities and conveying the inner workings of the legislative process and state government in Raleigh. Please feel free to pass this along to your clients or other interested parties. Send an email to kdjones@nexsenpruet.com to be added to the list.