Special update: Controversial bill on class size, pipeline fund, elections/ethics board merger heads to the Governor

Special update: Controversial bill on class size, pipeline fund, elections/ethics board merger heads to the Governor

An omnibus bill alleviating some of the headaches associated with North Carolina’s class size crisis easily passed the state House by a 104-12 margin Tuesday, despite continuing opposition from top Democrats on its controversial Atlantic Coast Pipeline and Board of Elections provisions.

Rep. Craig Horn, a Union County Republican who helped to assemble last week’s compromise conference report on House Bill 90, said the bill gives districts “much requested” time to prepare for the state’s new K-3 class sizes by phasing in its caps on average and maximum class size over the next four years.

The legislation, which also creates a $61 million recurring funding allocation for arts, music and physical education teachers, comes after years of mounting pressure on the Republican-dominated General Assembly to either ease their 2016 class size mandate or provide additional funding to save those so-called “enhancement” teaching positions.

As Policy Watch has detailed, local school districts would need to cough up millions or lay off scores of enhancement teachers to find space for the necessary new K-3 classroom teachers.

The legislation also modifies eligibility requirements for the GOP-backed, controversial Personal Education Savings Accounts and purports to provide sufficient funding to clear the waiting list for the state’s widely-backed, Pre-K program.

Multiple Republicans insisted this week and last that the revised House Bill 90, which was crafted behind closed doors, was a “bipartisan” measure.

“We do not have to be separated on this,” said Rep. Linda Johnson, the Cabarrus County Republican who co-chairs the chamber’s education and budget committees.

A controversial mashup

Yet, while many Democrats ultimately voted for the conference report because of its class size fix, some components of the omnibus bill clearly rankled minority party members in the House and Senate.

One section seeks to control spending from a $58 million environmental mitigation fund for the Atlantic Coast Pipeline, a fund that Democratic Gov. Roy Cooper’s office seeks to administer (see below for more details).

Also, a separate portion seeks to merge state elections and ethics panels while curtailing Democrats’ majority on the appointed elections board. The N.C. Supreme Court struck down Republicans’ merger of the panels last month, and GOP lawmakers are seeking to author their own fix before it’s taken up by a lower court.

House Bill 90 adds one seat to the State Board of Elections and Ethics Enforcement for someone who is not affiliated with either of the political parties with the most registered affiliates.

That means the Board would consist of four Republican members, four Democratic members and one unaffiliated member. Cooper can appoint all nine members of the new board — eight from a list of names compiled by the majority parties and one from a list of two names compiled by the other eight appointed members.

“This is a difficult vote to take, and it’s difficult because we’re voting on three separate matters,” said Rep. Deb Butler, a Wilmington Democrat who dubbed the package a “kitchen sink bill.”

Democrats also chafed over a lack of school construction funding in the measure.

“This bill does not address the needs in education that we know, Republicans and Democrats both know, are so necessary right now,” said Rep. Susan Fisher, an Asheville Democrat.

Legislative Republicans countered that K-12 infrastructure is historically a local government funding matter in North Carolina. However, state House members have widely supported a statewide $2 billion school construction bond referendum, which would address a portion of the state’s estimated $8 billion in K-12 capital needs, but Senate lawmakers have not taken up the matter.

“Like in all bills, there’s always more work to be done,” said Horn. “I’m looking forward to your support on that more work.”

The bill will now proceed to Cooper’s office. Cooper seems likely to veto the bill due to its pipeline and elections portions, although the legislature has the votes to override the Democrat’s veto.

Some Democrats suggested Tuesday that, with state courts still deciding the fate of the legislature’s election board tinkering, the class size fix could be “held hostage” by the legal wrangling.

Rep. Darren Jackson, the House Democratic Leader, said the lack of a severability clause may nix the entire bill if courts find one portion unconstitutional, although a longtime General Assembly attorney cast doubt on that claim this week.

Meanwhile, top Republicans like Rep. Nelson Dollar, a Wake County lawmaker and longtime budget writer, called House Bill 90 a “historic” moment for the legislature because of its support for a class size fix and Pre-K funding.

The proposal’s class size component had the backing of many top public school advocates, such as the N.C. Association of School Administrators, which helped to negotiate the deal.

But the N.C. Association of Educators (NCAE), which lobbies for K-12 teachers in Raleigh, has criticized lawmakers for tying the relief to other, more controversial mandates.

“The phased-in plan has always been the more reasonable approach for local school districts, but whether the resources are adequate is still a question mark,” said NCAE President Mark Jewell in a statement last week. “This doesn’t address the other class size challenges in higher grades, and it doesn’t provide funding for much needed school construction which many local districts will find a significant challenge.  While it ends a Pre-K waiting list, which is good, it’s unfortunate that this class size bill had to be politicized with other controversial legislation around the gas pipeline, state board of elections and expansion of a new private school voucher scheme.”

G.A. moves to control pipeline mitigation fund

Attached at the last minute, the environmental portion of the legislation reallocates $57.8 million from a mitigation fund related to the Atlantic Coast Pipeline. In late January, Gov. Roy Cooper announced he had brokered a deal with Dominion Energy, co-owner of the controversial project with Duke Energy, to create the fund. Its purpose is to offset the pipeline’s many environmental impacts, jumpstart economic development in eastern North Carolina, as well as create renewable energy projects. Now, the bill requires the money to be used instead for local school districts in the eight counties along the pipeline’s 160-mile route through eastern North Carolina.

“That money could be used for natural gas distribution lines and creating jobs,” said Rep. Darren Jackson, a Wake County Democrat who voted against the bill. “Now we’re killing jobs” in rural North Carolina.

It’s also possible that by diverting money to the eight school districts  (the complex formula to calculate the amounts should be an Algebra test question)  that lawmakers could justify cutting education funding in the future. That could backfire because the deal between the state and Dominion is not binding. Since it’s voluntary, Jackson noted, “they can walk away without putting any money into the fund.”

Last week, Sen. Erica Smith, a Democrat representing Northampton County, where the pipeline will enter the state, said it was “unfair” to tie the fund to a much-needed class-size fix. Smith compared the trade-off to “keeping your arm but losing your leg.”

Few people, other than perhaps the governor, utilities and the Chamber of Commerce boosters, support the agreement. Republicans don’t like it because they believe it usurps their appropriation authority, thus stoking the acrimony between them and Cooper. Environmental advocates disapprove because it looks like a quid pro quo: Cooper announced the fund within minutes of DEQ’s approval of a key water quality permit for the project. Although the governor’s office has vehemently denied any connection between the two, the optics are hard to argue with: “Pay money into this fund and receive state environmental approval.”

Moreover, the agreement contains an economic development provision that contradicts earlier statements by Dominion and Duke — more evidence that their promises were part of an elaborate public relations campaign. The utilities touted that the pipeline as an economic boon to an underserved part of the state. However, federal documents showed that most of the natural gas is going to the utilities’ own power plants. The remaining energy would be too expensive for businesses to access. It costs millions of dollars to simply hook onto the pipeline, not including the price of the natural gas. The mitigation fund, it seems, allows the utilities to deflect criticism about the economic promises.

Republican lawmakers seized on the dissent and presented Democrats with a difficult choice. “I’m upset that all this is wrapped into one bill,” said Sen. Floyd McKissick Jr., a Durham Democrat. “They should be debated on own merits as free-standing separate issues. The areas adversely impacted by pipeline need economic development — and they have educational needs.”

HB 90 now goes to Gov. Cooper. Though lawmakers adjourned today until May 16, a veto would almost certainly provoke another special session in the interim to consider an override vote.

Melissa Boughton also contributed to this report.