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2008 Orange County Democratic Party Legislative Breakfast

House Speaker Joe Hackney Orange and Chatham Counties and part of Moore County. Overview of Key Issue and House Democratic PlatformPreview of 2009. Senator Ellie Kinnaird Orange and Person Counties. Justice and Public Safety BudgetBills. Judicial Administrative Office of the Courts Budget Highlights.

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2008 Orange County Democratic Party Legislative Breakfast

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    1. 2008 Orange County Democratic Party Legislative Breakfast House Speaker Joe Hackney Overview of Issues/House D Platform Preview of 2009 Senator Ellie Kinnaird Justice and Public Safety Budget Bills Representative Verla Insko Bills HHS Budget Representative Bill Faison State Finance Bills

    2. House Speaker Joe Hackney Orange and Chatham Counties and part of Moore County Overview of Key Issue and House Democratic Platform Preview of 2009

    3. Senator Ellie Kinnaird Orange and Person Counties Justice and Public Safety Budget Bills

    4. Judicial Administrative Office of the Courts Budget Highlights Five new positions for the Guardian ad Litem program Three additional assistant District Attorney positions. Three additional District Court Judges Four additional Deputy Clerksf 10 additional Magistrates

    5. Judicial Office of Indigent Defense Services Budget $1.1 million NR expansion for private attorney fee payments Issues: Possible backlog of $2.5 million in unpaid fee applications that will carry forward into FY 2009-10 for payment. OIDS will request additional $7 million R in FY 09-10 and $12 million R in FY10-11 for private attorney fee payments.

    6. Juvenile Justice and Delinquency Prevention Budget Highlights Restores fully JCPCs funding ($22.6 million ) and provides an additional $500,000 R increase for county formula grants Provides 30 additional Detention Center positions

    7. Juvenile Justice Budget Issues FY 2009-11 Biennium $1.5 million in planning and design funds for the second phase of youth develop center replacement. DJJDP is expected to submit a $37 million capital expansion request to construct four new facilities to house 160 youths. One of the findings/recommendations of the 2008 continuation review was to revise the JCPC funding formula to correct current inequities in the amounts allocated to each county. The Department may request funds to hold counties harmless.

    8. Corrections Budget Highlights Establishes a new substance abuse treatment program for female probationers and parolees, similar to the DART-Cherry program in Goldsboro for men ($1.9 million) Provides positions to support the Inmate Construction project--$1.8 m Restores fully the CJPP funds ($9.1 million) and provides an additional $257,729 R expansion for county programs Establishes a reserve for Probation Supervision--$2 million R & $500,000 NR Provides funds to enhance GangNet, an Internet-based law enforcement intelligence sharing database. GangNet will be enhanced through the incorporation of gang data currently collected in OPUS (DOC's information system)

    9. Correction Budget Issues FY 2009-11 Biennium Gang legislation ratified during the 2008 Session will create the need for 250 new prison beds in FY 2009-10 and 500 additional beds in FY 2010-11. These beds are over and above the Sentencing Commission's projected bed shortfalls of 494 and 1,165 beds, respectively, in FY09-10 and FY10-11. S.L. 2008-107 authorized the construction of 1,500 beds which are not expected to come on line until the FY 2011-13 Biennium Operating costs estimated at $14.6 million annually will be needed for 582 prison beds expected to come on line during the FY 2009-11 biennium. During the FY 2008-09 Interim, DOC will report on the longer term resource needs arising from the National Institute of Corrections' recommendations to address the deficiencies in the North Carolinas probation and parole system. S.L. 2007-323 provided $494,986 NR to develop a plan to redesign and upgrade the DOC's offender information system (OPUS). DOC will most likely submit a FY09-10 expansion request to upgrade/replace OPUS, a 1980s-vintage legacy system. S.L. 2007-323 provided $3.6 million renovate a building to house "Our Children's Place," a new initiative to house up to 20 female inmates and up to 40 of their children in Butner. The facility is expected to be completed and come on line in FY 2009-10. Funding for the operating costs, which will be substantial, remains to be budgeted.

    10. Crime Control and Public Safety Budget Highlights Provides $200,000 NR for equipment for HAZMAT Regional Response Teams Provides an additional $1.1 million R for the Rape Victims Assistance Program and expands coverage to all rape victims. Provides $600,000 NR to the North Carolina Sheriffs Association to continue the Illegal Immigration Project. Provides $250,000 NR for grants to Sheriffs' Departments to assist them in implementing State sex offender laws

    11. Prison Population Growth and Policy Issues May 2008

    12. 2007-2008 Bills SB 448 Carrboro Campaign Finance SB 1748 Chapel Hill Vehicle Registration SB 1749 Chapel Hill Water Conservation Strategies SB 1842 Chapel Hill Energy Efficiency SB 685 Up Penalties Cross Burn/Illeg. To Hang Noose SB 157 Honor Pauli Murray

    13. Representative Verla Insko Part of Chapel Hill, Carrboro and Orange County Bills Highlights of DHHS budget

    14. HB 2688 Health Care Policy Council Permanent body of legislators, health care professionals and advocates Provide ongoing analysis of our health care system and recommend changes that would ensure access to appropriate and affordable health care for all North Carolinians

    15. Health Care Policy Council Principles Continuous review of health care system is essential to ensure access to appropriate, affordable health care. Health care providers and clients should have a primary role in medical care decisions, taking into consideration evidence-based care and cost of care. Comprehensive care includes dental care, vision care, and mental health, substance abuse and developmental disabilities services. Health care policy must recognize the value of prevention, early intervention, and wellness and other public health care services.

    16. Budget Highlights FY 2008-09 Department of Health and Human Services

    17. Mental Health, Developmental Disabilities, and Substance Abuse Services

    18. Mental Health and Substance Abuse Treatment Facilities $10.9 million for staffing, clinical, and operational improvements at State mental health and substance abuse treatment facilities. $5.2 million NR for the Dorothea Dix Hospital Overflow Unit, a 60 bed psychiatric unit of the new Central Regional Hospital to remain open on Dorothea Dix Campus. Ensures that when the new Central Regional Hospital opens all safety and staffing requirements will have been met.

    19. Health Care for the Children, Indigent, Uninsured, and Rural Populations

    20. Health Promotion and Disease Prevention

    21. Children's Services $9 million for child care subsidies to remove 1,110 children from the waiting list. $8.2 million to to increase foster care and adoption assistance payments. Appropriates $100,000 in additional funding for the North Carolina T.E.A.C.H Early Childhood Education Project Provides $500,000 in additional funding for local Smart Start initiatives

    22. Cost Savings – State Funds Community Support Services Saved $86.4 million in State appropriations. Tightened program requirements for eligibility and for providers Saved $5.03 million by expanding use of generically-available specialty drugs. Saved $35,324,306 by reducing Medicaid provider rates that applies to nearly all public and private health care providers. Saved $65.5 million due to an increase in the federal Medicaid matching rate. Saved $28.9 by expanding management of care for the aged, blind, and disabled

    23. Representative Bill Faison Part of Orange County Bills Finance Issues

    24. Homeowner Protection Bills H2688 requires lenders to give homeowners 45 days notice before starting foreclosure proceedings and gives the state bank commissioner authority to delay foreclosures for 30 days in hopes of coming up with a new payment plan. H2188 requires home loan servicers to provide anyone taking out a mortgage with information about servicer fees within 30 days of the activation of those fees. H2463 clarifies the Mortgage Lending Act by describing the qualifications and duties of a mortgage lender and requires mortgage servicers to be licensed annually.

    25. Homeowner Protection Bills Appropriated $3 million for the Home Protection Pilot Program run by the Housing Finance Agency to expand to cover the entire state. This program assists workers who have lost their jobs by providing qualified homeowners interest-free loans while they look for new jobs. Homeowners who apply to the program are granted a 120-day stay of foreclosure.

    26. Homeowner Protection HB 1817 limits broker fees, protects borrowers from some of the dangers of adjustable rate mortgage loans and clarifies mortgage broker duties. Lenders are required to determine that the homeowner can repay the loan. The law also prohibits prepayment penalties and expressly gives the Commissioner of Banks the authority to create rules to protect the borrowing public. HB 817 makes it a felony to knowingly misrepresent or exclude information in the mortgage lending process even if the victim is not harmed financially.

    27. Changes in Tax Law Expanded the Earned Income Tax Credit to 5 percent beginning January 2009. This refundable tax credit is expected to help an estimated 800,000 people in the state who earn about $40,000 a year or less by lessening their tax burden and in some cases returning money to them. $8.5 million to extend a tax credit for small businesses that provide health benefits to their employees Creation of a disabled veterans' property tax homestead exclusion to give disabled veterans and their surviving spouses a break on their property taxes

    28. 2007-08 Revenues

    29. Economic Outlook Some of the State’s industry sectors, once thought resistant to the national housing and financial market meltdown, are now showing signs of vulnerability. Weak housing, high commodity prices (both gas and food), and tight credit are taking a toll on consumer spending. This is beginning to cause some disruptions in the service and retail sectors. The national economy is expected to grow at no more than 1 or 2% through 2009 according to most forecasters. Moody’s economy.com forecast envisions only 1.2% growth in the State’s gross product in 2008 and 2.9% for 2009. Thus, employment growth may stall causing personal income tax growth to slow beyond previous expectations.

    30. Economic Outlook (continued) The housing recession has caused a lot of damage to the economy as housing prices fall and consumer wealth is reduced. Recent, albeit preliminary, reports suggest there may be at last a light at the end of the tunnel on housing. Nonetheless, there is still a long way to go before the housing mess is fully behind us. The anticipated rise in energy prices came earlier than expected, has lasted longer than expected, and was higher than expected. Consumer confidence plummeted as gas and food prices continued to rise through the spring and summer. The fiscal stimulus package rolled out by the Feds this summer may have propped-up capital investment (bonus depreciation), but the rebates may not have had as big an impact on consumer spending as some had hoped.

    31. Economic Outlook (continued) While this spring and summer was not good for consumers, there are some potential improvements on the horizon. Housing prices may have bottomed-out and after-tax monthly mortgage payments are at historically lower levels measured as a percent of after-tax income. Financial market interventions by the Fed (including Fannie and Freddie) have lowered mortgage rates and further improved housing market prospects. The possibility of low lending rates, lower gas prices, and lower grocery bills may lead to improved consumer confidence and provide sufficient stimulus to keep us out of a recession.

    32. Economic Outlook (continued) Well below normal economic growth is expected for the remainder of 2008 and 2009: 0% to 2 % inflation-adjusted growth instead of 3%. Many economists think the probability of a recession remains high. The global economic slowdown, unstable commodity prices, and the financial market turmoil could prove troublesome. Exports continue to support economic growth, but the slowdown in both developing and mature international markets fuels recession concerns in the U.S. This means the economy will remain at risk, especially consumer spending, for the following reasons: the loss of household wealth, a result of the prolonged real estate recession; tighter consumer credit from the sub-prime/foreclosure debacle; weak income growth from a soft labor market; and elevated food and energy prices. These economic conditions will lead to below average growth in employment and a growing number of people unemployed.

    33. Things to Watch The severity of companies pulling back on employment if the slowdown worsens and product demand declines. Any new spikes in energy prices, including both gas and heating fuels, will be hard on consumers & businesses. Will housing finally rebound improving residential construction or will tighter credit hurt both residential and commercial construction? Will the State’s labor market continue to weaken, and how much impact will the weak labor market have on the State’s wage & salary growth?

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