Friday, August 8, 2014

End of Session Bill Wrap-Up

Even though the legislature isn't quite done (an adjournment resolution hasn't been agreed upon and a November special session to look at Medicaid Reform is definite, we are providing the below summaries of legislation passed or considered that relates to people with disabilities.


HB 230, Clarify Read to Achieve/School Performance Grades (Malone, Martin, Brody, Samuelson). HB 230 amends the Read to Achieve law passed last year to make several modifications: it directs the State Board of Education to provide, approve and establish achievement levels for several valid and reliable alternative assessments; allows the student reading portfolio to begin to be compiled during the first half of the school year; gives flexibility in providing the summer reading camps; requires qualitative and quantitative data from the Kindergarten Entry Assessment; clarifies the good cause exemptions from mandatory retention for Limited English Proficient students and students with IEPs; makes clear that parents/guardians make the final decision regarding a retained student's participation in reading camp, with at least one opportunity for students not attending to demonstrate proficiency prior to being retained; and clarifies that a student can be promoted anytime. The legislation has been signed by the Governor and is S.L. 2014-5.

HB 712, Clarifying Changes/Special Ed Scholarships(Glazier, Stam, Jackson). HB 712 clarifies the Special Education scholarships for children with disabilities and exempts certain schools from child care licensure requirements.  It clarifies the definition of a qualifying child and includes related services and educational technology as reimbursable. The child care licensure portion exempts from state licensure private schools that operate child care facilities before and after school.  It was signed into law and is SL 2014-49. It applies to grants awarded starting with the 2014-15 school year.

HB 884, Dropout Prevention/Recovery Charter School Pilot (Jeter, R. Moore.  Blackwell, Cotham). The bill establishes a pilot program in a charter school for high school students who have dropped out of school. The Pilot Program is to begin with the 2014-2015 school year and conclude at the end of the 2015-2016 school year. Additionally, after questions were raised regarding the transparency of $ paid to contractors, the bill was amended to study and report on contracts for personnel services by local boards of education and charter schools. It is SL 2014-104.

SB 793, Charter School Modifications (Tillman, Cook).  SB 793 modifies the laws governing charter schools, including that a teacher employed by a charter school may serve as a nonvoting member of the school board of directors; amends the date by which the SBOE shall make decisions on applications; allows a charter school to expand one grade higher without approval; allows for a 10 year renewal period; makes explicit that single gender charter schools may limit admission on the basis of gender; allows priority enrollment or the children of board members beyond the initial year; makes charter schools subject to the requirements of the open meetings and public records laws; and directs the SBOE to develop a fast-track approval process. It also adds a provision to the statute that charter schools shall not discriminate against any student on the basis of ethnicity, national origin, gender, or disability, explicitly leaving out sexual orientation. Rep. Cotham, the only Democrat appointed to the conference committee, refused to sign the report because the final version did not include an anti-discrimination provision protecting children who are LGBT.  The final version also allows charter schools run by for-profit educational management companies to shield salaries of employees who work for the companies rather than for the nonprofit board of directors. The bill awaits the Governor’s signature. It applies beginning with the 2014-15 school year and is SL 2014-101.

SB 812, Replace Common Core State Standards with NC’s Higher Academic Standards (Soucek, Tillman).  SB 812 establishes an Academic Standards Review Commission to advise the State Board of Education on NC academic standards, which shall be named the North Carolina Standard Course of Study. It was signed into law by the Governor and is SL 2014-78.


SB 773, General Statute Corrections (Hartsell).   SB 773 makes several technical corrections to the General Statutes.  Although there are several provisions in the bill, one relates Chapter 122C.  It amends NCGS 122C-268(g) to allow interactive videoconferencing for inpatient commitment district court hearings.  It became effective when signed into law and is SL 2014-107.


HB 369 Criminal Law Changes and SB 594, Omnibus Justice Amendments.  HB 369 proposed to modify the expunction law; authorize changing deferred prosecutions to conditional discharge in statute;  make possession of marijuana paraphernalia a Class 3 misdemeanor; study the prevention of sexual abuse of children; increase penalties for giving/selling to or an inmate possessing a cell phone; and remote video testimony by forensic and chemical analysts.  The bill was in Conference at the end of session and was not resolved. SB 594 included similar provisions and a section that amends our state law to conform to the US Supreme Court decision in Hall v. Florida, in which the Supreme Court held that states must take into account more than a hard and fast IQ number in determining whether an individual has an intellectual disability for purposes of capital punishment.  SB 594 was approved by the full House but did not proceed after it was returned to the Senate.

HB 725, Young Offenders Rehabilitation Act (Avila, Moffitt, Mobley, Hall).  HB 725 seeks to raise the age of juvenile jurisdiction from 16 to 18-years-old for misdemeanors. Despite the bill passing the full House with a vote of 77-39, the Senate did not take up the issue.


HB 625, Zoning/Health Care Structure (Moffitt, Howard, Setzer, Ramsey). HB 625 will allow a ”temporary family health care structure” to be used by a caregiver in providing care for a person with a physical or mental impairment. A temporary health care structure is a manufactured unit of no more than 300 square feet for one occupant who has a mental or physical impairment. Such a structure shall be a permitted accessory use in single family residential zoning districts when placed on the property of the caregiver's residence and used to provide care for the person.  The law becomes effective October 1, 2014.  It was signed into law by the Governor on August 1 and is S.L. 2014-94.


HB 761 and SB 734, Regulatory Reform Act of 2014.  Various provisions were proposed for regulatory reform during the session but none of the bills made it to final approval. HB 761 is in the Senate Rules committee. SB 734 is in conference. The proposed provisions included: OAH electronic filing; study whether to allow entities other than local sheriffs to serve tenants in Summary Ejectment proceedings; clarifying ADA requirements for private pools; streamline and clarify the rulemaking process; report on duplicative auditing and monitoring of behavioral health and developmental disability providers; end the sunset for facilities that use alternative electronic monitoring; and to lengthen the Medicaid recredentialing period to 5 years.

HB 1069, Unemployment Insurance Law Changes (Howard, Warren, Arp). HB 1069 sought to amend the Unemployment Insurance laws, as Recommended by the Joint Legislative Oversight Committee on Unemployment Insurance.  The proposals included requiring photo ID for benefits; setting benefit duration according to the unemployment rate; modifying the work search requirement by increasing the number of job contacts to 5 per week and eliminating the requirement to search on 2 different days.  After passing both chambers, the bill was vetoed by the Governor because of a provision setting up an independent Board of Review.

HB 1098, DMV DL Medical Review Program Changes (Torbett). HB 1098 proposed changes to the DMV Drivers License Medical Review Program, as Recommended by the Joint Legislative Transportation Oversight Committee.  As the legislation involved matters that are the current subject of a Disability Rights NC lawsuit, DRNC opposed the legislation. It did not move forward.

HB 1133, Technical and Other Corrections (T. Moore).  HB 1133 makes technical and other changes to the state laws. Among other items, it includes technical changes to the laws related to the licensing of interpreters for the deaf and hard of hearing. It awaits the Governor’s signature.


SB 403, Omnibus Election Clarifications (Bingham). SB 403 makes a number of changes to the voting laws, from eligibility to file for office after switching parties to filing requirements. One section adds a provision to the current law regarding the procedure for voting absentee ballots to ensure that the failure of a witness to list a zip code does not invalidate the application and certificate. There is also a provision regarding early voting that makes clear that the cumulative number of scheduled voting hours includes those offered at the county board of elections. With some exceptions, the majority of the bill became effective when signed and is SL 2014-111.


HB 1224, Local Sales Tax Options (Presnell).  HB 1224 was an economic development bill as originally filed. However, the Senate added provisions capping local sales tax and limiting the use of such taxes collected between Education, Transit and General Use. The bill had a great deal of opposition and was referred to the House Rules committee at the end of session. This issue will likely come back next session.

SB 763, Revenue Laws (Rabon, Rucho).  As originally filed, SB 763 proposed several clarifying changes to the Revenue laws passed last year, as recommended by the Revenue Laws Study Committee. The House added in provisions to extend the Historic rehabilitation and film tax credits.  The bill passed the House after the Senate had already left town so the bill was referred to Senate Rules and did not proceed.   Although the bill did not ultimately become law, it may signify a willingness to re-examine some of the tax changes made last year. 

Monday, August 4, 2014

Summary of Other Budget Provisions

Part 4 of 4 on the 2014-15 Budget


·         Eliminates all misdemeanants from state prison.
·         Prison Changes:   Closes Fountain and North Piedmont Correctional Centers for Women and converts Eastern Correctional into a Women’s Minimum Custody facility.
·         Moves the SBI and Crime Lab into the Department of Public Safety.
·         Reduces administrative funding to IDS by $466k.  This will result in the loss of positions at IDS, including positions supporting juvenile defenders.
·         Abolishes 4 special superior court judge positions and establishes 2 new business court judgeships.
·         Allow a 3 judge panel to rule on the constitutionality of acts of the General Assembly.

·         Eugenics Program Amendments: Modifies the payment timeline for claims to provide for an upfront payment this fall and a final payment after all appeals have been exhausted. It also adds that all missing claim information must be postmarked to, or received by, the Office by September 23, 2014, in order to be considered.

·                     The Earned Income Tax Credit sunset was not extended.

·                     $10 mil to create a loan program that will assist in the the development of low-income housing statewide through the Housing Finance Agency.

Summary of Education Budget Provisions

Part 3 of 4 on the 2014-15 budget.

Again, the Committee Report summarizing the budget adjustment provisions is online here and the full budget bill is online here.


Teacher Pay Increases
·         Salary Increase for Educators: The budget allocates $275 mil in recurring funds for an average 7% teacher pay raise. The increase brings the minimum pay for all teachers to at least $33K per year.
·         Salary Increase for School-based Administrators - $5.8 mil is allocated for a step increase for school-based administrators. Provides funds for salary schedule changes and an experience-based step for all step-eligible school-based administrators. In addition, funds are provided for a nonrecurring salaries and benefits bonus of $1,000 ($809 salary increase) for all school-based administrators who do not receive a salary increase on this schedule.
·         Salary Increase for Other School Personnel - $32.6 mil is allocated to provide a $500 salary increase for all other school personnel. Provides a $618 recurring salary and benefit increase ($500 salary increase) for permanent full-time non-certified and central office personnel.
·         Classroom Teachers - the budget includes $42M increase to decrease class size by 1 student in Kindergarten and first grade.
·         $18.7 mil for Master’s degree supplement. The Master’s degree supplement will continue for Certified school nurses and instructional support personnel in positions for which a master's degree is required for licensure; Teachers and instructional support personnel who were paid on that salary schedule or received that salary supplement prior to the 2014-2015 school year; and Teachers and instructional support personnel who (i) complete a degree at the master's, six-year, or doctoral degree level for which they completed at least one course prior to August 1, 2013, and (ii) would have qualified for the salary supplement pursuant to State Board of Education policy that was in effect on June 30, 2013. The Education Oversight Committee will  study the payment of salary supplements for advanced degrees and make recommendations.
·         Maintains Teacher Assistant funding at a level that will purportedly maintain the levels at which TAs were employed last year, but provides no additional funding for increased enrollment, and backs out funding for positions that were used for Teachers instead of Teacher Assistants.

Education Funding for Children in PRTFs
·         Funds for children in Psychiatric Residential Treatment Facilities: The budget includes $3.2 mil in funding for the education of children in PRTFs. The special provision language amends Chapters 115C and 122C to make clear that the SBOE has a duty to ensure educational services in PRTFs for all children and to ensure that a child with a disability as defined under G.S. 115C-106.3(1) in a PRTF receives educational services and procedural safeguards as required by law.
·         The special provision also sets out the requirements of the facilities for the facility-based schools.
·         This is a DRNC agenda item and a major victory for children receiving treatment in these facilities.

Other Adjustments
·         $6 mil to implement the Excellent Public Schools Act.
·         Provides an additional $42 mil to decreases class size allocations by 1 student in both Kindergarten and Grade 1. The new Kindergarten allotment ratio will be 1 guaranteed teaching position for every 18 students in membership, an increase of 359 positions. The new Grade 1 allotment ratio will be 1 guaranteed teaching position for every 17 students in membership, an increase of 402 positions. This expansion, combined with other class size modifications made in S.L. 2013-360, will lower the FY 2014-15 teacher allotment ratios in Grades K-3 by 1 student per teacher as compared to the FY 2013-14 ratios.
·         Lottery Receipts - the budget replaces $147 mil in general fund dollars for teachers and teacher assistants with lottery receipts.
·         At-risk Student Services - This allotment is reduced by $9.2 mil.
·         $2.75 mil, or 3%, reduction to LEAs for Central Office staff.
·         $5 mil cut to DPI, with no reduction to be taken from NC Center for Advancement of Teaching or the Schools for the Deaf or Morehead, unless there are positions that have been vacant for more than 16 months; or from Communities in Schools of North Carolina, Teach for America, or Beginnings For Parents of Children Who Are Deaf or Hard of Hearing.
·         $11.8 mil for Opportunity Scholarships.
·         $1 mil for the Communities in Schools program.
·         Enacts law regarding Epinephrine auto-injectors (Epi Pens) use and storage at schools.

·         Establishes a Virtual Charter School Pilot Program: Directs the State Board of Education to establish a pilot program for 2 virtual charter schools serving students in kindergarten through twelfth grade, beginning with the 2015-2016 school year. A virtual charter school participating in the pilot may serve any grade span of students in kindergarten through twelfth grade, and shall continue for a period of four school years and shall end with the 2018-2019 school year. The special provision language sets out other requirements including student teacher ratios.

Summary of Health and Human Services Budget Provisions

Part 2 of 4 on the 2014-15 Budget

Again, the Committee Report summarizing the budget adjustment provisions is online here and the full budget bill is online here.

Health and Human Services


·         Flexibility Cut: DHHS is required to cut $16 mil from administration expenses, vacant or filled positions, or contract expenses on a recurring basis. The budget prohibits DHHS from taking funds that provide direct services, but the term is not defined.
·         Provides $2 mil for state matching funds to support the Health Information Exchange.
·         Allocates $2 mil for continued short-term assistance for group home residents who became ineligible for personal care services on or after January 1, 2013.  A report is due by April 1, 2015 to HHS Oversight with a detailed plan for a long-term solution for individuals residing in group homes who would like to continue residing in this setting and, as a result of an independent assessment, have been determined to need only supervision, medication management, or both; and a list of funding sources for each group home that receives assistance.
·         Allocates $175k from the departments’ competitive grant funding to St. Gerard House for the purpose of assisting individuals with autism spectrum disorders, learning disabilities, developmental delays, and behavioral health needs. St. Gerard House shall be required to seek future funding through the competitive grants process.  
·         Medicaid Reform: The House and the Senate were unable to reconcile their different proposals for Medicaid Reform. We will be returning to Raleigh in November for a special legislative session to come to an agreement. (As a reminder, the Senate proposed a separate Medicaid agency outside of DHHS and allowed private managed care organizations; the House proposed continuing the current agency structure and public Accountable Care Organizations.)
·         Allocates $136 mil in non-recurring funding for Medicaid for FY 13-14 for unpaid claims and enrollment backlogs.
·         Medicaid Contingency Fund: The budget allocates $186 mil to a contingency fund that may be used for a Medicaid overage but only after the department has applied to CMS to eliminate automatic eligibility for all SA recipients (not just those over 100% Federal Poverty Level as discussed below).
·         State/County Special Assistance (SA): The budget reduces Medicaid eligibility for recipients of SA to only those individuals whose income is 100% of the Federal Poverty Level or less. The current standard is individuals with insufficient income or resources to provide a reasonable subsistence. The special provision language also attempts to grandfather in all those who are currently Medicaid eligible through Special Assistance.  However, Medicaid eligibility will no longer be tied at all to Special Assistance if Medicaid is over budget and the Department needs to access the above contingency fund.
·         Mental Health Drug Management: Directs DHHS to make adjustments to the Preferred Drug List, prior authorization, utilization review and other restrictions to achieve $6 million in savings this year and $12 mil in future years.
·         Modify Intensive In-Home Service: No later than October 1, 2014, DMA shall modify the service definition for the Intensive In-Home Service to reflect a team-to-family ratio of one Intensive In-Home team to families for both the Medicaid and NC Health Choice programs.
·         Study Additional 1915(c) waiver for adults with developmental disabilities: directed to study a waiver that would create 1,000 new slots each year for 3 years, to serve a total of 3,000 additional adults with developmental disabilities from January 1, 2016, to June 30, 2019, with a budget for each slot capped at $20k per plan year per beneficiary, and slots will target individuals on the registry of unmet needs.
·         Traumatic Brain Injury Waiver: Directs DMA to design and draft a waiver to add a new service package for Medicaid eligibles with TBI. A TBI subcommittee of the HHS Oversight committee is also to be established.
·         Personal Care Services Management: Directs DMA by March 1, 2015 to propose a financial plan to contain the budget growth of PCS to keep the total PCS budget at the same level as the fiscal year 2014-2015 certified budget for PCS. It also authorizes the HHS Oversight committee to engage a contractor to study issues related to reforming and redesigning PCS while meeting the State's obligations under the ADA and Olmstead.
·         Provider Rates: Reduces provider rates by 1.0% effective January 1, 2015. This reduction applies to all fee-for-service providers with the exception of hospital inpatient services, drugs and dispensing fees, nursing homes, non-PCS home care services, private duty nursing, all cost based providers, services where rates or rate methodologies are set by the federal government, negotiated through a contract, hospice, CAP services, FQHC and Rural Health Centers or as specified in special provision.  This is in addition to a 3% reduction passed last year, which applies to inpatient hospitals, Physicians, excluding primary care until January 1, 2015, Dental, Optical services and supplies, Podiatry, Chiropractors, Hearing aids, Personal care services, Nursing homes (ending June 1, 2015), Adult care homes, and Dispensing drugs.
·         Nursing Home Case Mix Index Adjustment: Freezes the case-mix index adjustments for direct cost of nursing home rates effective January 1, 2015.
·         Personal Care Services (PCS) Study Optional Program: Allocates $300,000 to contract for a study to define a new limited PCS optional service program. The report from this study is due December 1, 2015. Additionally, the Department will study and report on Adult Care Home inspections, procedures and processes.
·         Medicaid Appeals: Amends appeals related to non-LME/MCO decisions to shift the burden of proof to the recipient in all appeals; and to clarify in all appeals that a recipient who accepts and offer to mediate and then does not attend the mediation without good cause shall have their appeal dismissed. It also shifts the burden of proof in provider appeals to the provider.
·         County of Origin Issues: Directs DHHS to address issues arising when Medicaid recipients move residence from one county to another county and from one LME/MCO catchment area to another, including reducing the administrative burden on ICFs which contract with more than one LME/MCO, and engaging counties to create a plan to resolve issues related to the county of origin for social services and public assistance programs.
·         Hospital Funding Changes:
  • Hospital Outpatient Cost: Reduces the settlement for the UNC Hospitals and Vidant, formally known as Pitt Memorial Hospital (ECU), for outpatient services to 70% of Medicaid costs effective July 1, 2014. This represents a 2.1% reduction in overall hospital outpatient Medicaid spending.
  • State Retention of the Hospital GAP Plan Assessment: Increases the State retention on assessments through the hospital GAP plan from 25.9% to 28.85% effective July 1, 2014.
  • Single Base Rate for All Hospitals: Establishes a single base diagnosis related group (DRG) rate for inpatient hospital services based on the statewide median base rate at June 30, 2014 for all hospitals effective January 1, 2015.

·         Modifies Moratorium on Special Care Unit Licenses to allow licenses to be issued for facilities that were in possession of a certificate of need as of July 31, 2013, that included authorization to operate special care unit beds.

·         NC PreK: $5 mil to accommodate the recommended rate increase and teacher salary increases, and additional slots if funding is available. The budget also replaces nearly $20 mil in general fund dollars with TANF funds on a non-recurring basis.

·         Child Protective Services Funding: $7.4 mil in additional funding for child protective services and $4.5 mil for expanded in-home services. The General Fund appropriation for Child Protective Services is increased by 101% to $27 million.
·         Enhance Oversight of County Child Welfare Services: Provides $750k for nine positions to enhance oversight of child welfare services in local county departments of social services. These positions will monitor, train, and provide technical assistance to the local county departments of social services to ensure children and families are provided services to address safety, permanency and the well-being of children who are served by child welfare services. 
·         Child Protective Services Statewide Evaluation: Provides $700k for an independent, statewide evaluation of Child Protective Services at local departments of social service and the Department of Health and Human Services. The evaluation will assess performance, caseload sizes, administrative structure, funding and worker turnover and include recommendations on improving Child Protective Services.
·         Child Protective Services Pilot Program: Provides $300k to develop and implement a pilot program designed to enhance coordination of services and information among agencies to improve the protection and outcomes for vulnerable children served through Child Welfare Services. The agencies included in the pilot are local county departments of social services, local law enforcement, the court system, Guardian Ad Litem programs and other agencies as determined appropriate by the Department of Health and Human Services. 
·         Foster Care Assistance Payments increased by $5 mil.
·         Drug Testing for Work First: Provides funding for implementation of Work First drug testing that was passed in last year’s budget.
·         State County Special Assistance Income Eligibility: Changes SA eligibility to income at or below 100% of Federal Poverty level, regardless of where recipients reside. Current recipients of SA are grandfathered in and will continue to receive SA. Saves $378k in the first year.  Accompanying reduction of $4.2 mil for reduced SA caseloads.
·         Adult Care Home Case Management: Eliminates funding for the Adult Care Home Case Management Service which ended in June 2013. This service provided funding for county DSS workers to perform the assessment and case management for individuals in adult care homes and licensed family homes who were heavy need residents. The Personal Care Services (PCS) Program now uses an independent assessment to determine eligibility for PCS and therefore the Case Management Service is no longer needed.
·         Public Guardianship: Amends the law regarding status reports filed by public guardians and directs DHHS and the Administrative Office of the Courts to develop a plan regarding the Department's evaluation of complaints pertaining to wards under the care of publicly funded guardians in order to ensure that, in addition to current requirements, the complaint process incorporates a face-to-face observation of the ward, an interview with the ward, or both. This was a DRNC agenda item.

·         Early Intervention / CDSAs: The budget maintains the previous year's $10 mil budget reduction and the elimination of 160 positions, but it does not include the mandated closure of four CDSAs. It also mandates maintenance of current eligibility requirements.  This was a DRNC agenda item.
·         Child and Family Support Team: Eliminates $252k in funding for two positions that were allocated for start-up of the program.

Mental Health/Developmental Disabilities/Substance Abuse Services
·         Funding for the Wright School is maintained.
  • $1.8 mil reduction to LME/MCO administration through projected savings from consolidation from 9 LME/MCOs operating in FY 2013-14 to 7 or fewer by June 30, 2015.  Leaves $30 mil for administration.
·         Eliminates 7 positions at Central Office Administration.
  • Eliminates $6 mil LME/MCO risk reserve.
  • Allocates $2.2 mil for community-based crisis services to increase the number of co-located or operationally linked behavioral health urgent care centers and facility-based crisis centers; increase the number of facility-based crisis centers designated by the Secretary as facilities for the custody and treatment of involuntary clients with priority to areas of the State experiencing a shortage of these types of facilities; to provide reimbursement for services provided by facility-based crisis centers; and to establish facility-based crisis centers for children and adolescents.
  • Ensures that $2.4 mil will be used exclusively to support TBI services.
·         Reduces General Fund appropriation to the Home and Community Care Block Grant by $970k, a 3% cut.
·         Allocates $100k Non-Recurring for Senior Center capital costs.

Summary of the 2014-15 Budget

The state House and Senate have finally passed the 2014-15 budget. We began the short session in May with high hopes for a June adjournment, but the chambers just gave final approval to the budget on Friday and Saturday.  At this time, the Governor has not signed it but has announced that he will sign it soon.

The budget is a mixed bag of wins and losses for people with disabilities and their families. Teachers receive an average 7% salary increase, and other state employees a $1000 increase.  The state is finally recognizing and funding the necessary education for children receiving treatment in Psychiatric Residential Treatment Facilities. However, the autism insurance mandate did not pass, and adults receiving State/county Special Assistance could lose their Medicaid and those with an income over 100% of the Federal Poverty Level could lose their SA altogether.

The full budget is online here and the Committee Report (a much easier read) is here. Our Summary of the budget will be appearing on the blog in three pieces: Health and Human Services, Education, and Other (Justice and Public Safety, etc.).

We haven't quite reached the end of session - the Senate and House will be back next week to up any vetoes and possibly a host of other topics.  We will also be back in November to take up Medicaid Reform. Since these subsequent sessions will be focused on a few defined areas, we will have up summaries of legislation that did pass later this week.