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The North Carolina State Budget

2006-2007

Michael F. Easley

Governor

Post-Legislative Budget Summary

The North Carolina State Budget

2006-2007 Office of State Budget and Management Office of the Governor Raleigh, North Carolina www.osbm.state.nc.us David T. McCoy, State Budget Officer Charles E. Perusse, Deputy State Budget Officer November 2006

Post-Legislative Budget Summary

Table of Contents

List of Figures and Tables......................................... vPreface..................................................................... viiIntroduction.............................................................1Executive Priorities and Budget Summary..............3Major Budget Changes by Subject Area...................7

Fiscal.Responsibility................................................9Education.............................................................10Health.and.Human.Services.................................13Economic.Development.and.Infrastructure..........14Courts.and.Public.Safety......................................15Environment.and.Agriculture...............................16Capital.Improvements..........................................17Teachers.and.State.Employees...............................19

Revenue by Topic....................................................21General.Fund.Forecast..........................................23Highway.Fund......................................................27Highway.Trust.Fund.............................................31

General FundRevised Appropriations

EducationPublic.Education.(13510)................................37The.University.of.North.Carolina.(160xx).......47Community.Colleges.(16800).........................60Education.Lottery.Fund.(23003).....................68

General GovernmentGeneral.Assembly.(11000)...............................73Office.of.the.Governor.(13000).......................75Office.of.State.Budget.and.Mgt..(13005).........77NC.Housing.Finance.Agency.(13010).............79OSBM.-.Reserve.for.Special.Appropriation.(13085)...........................................................81Office.of.the.Lieutenant.Governor.(13100).....83Dept..of.Secretary.of.State.(13200)..................85Office.of.the.State.Auditor.(13300).................88Dept..of.State.Treasurer.(13410)......................90State.Treasurer.-.Retirement.for.Fire.and.Rescue.Squad.Workers.and.Line.of.Duty.Death.Benefits.(13412)...........................................................92Dept..of.Insurance.(13900).............................94Insurance.–.Volunteer.Safety.Workers’.Compen-sation.Fund.(13901)........................................96

Dept..of.Administration.(14100).....................97Office.of.the.State.Controller.(14160)...........102Dept..of.Revenue.(14700).............................103Dept..of.Cultural.Resources.(14800).............107Roanoke.Island.Commission.(14802)............111State.Board.of.Elections.(18025)...................112Office.of.Administrative.Hearings.(18210)....114

Health and Human ServicesDept..of.Health.and.Human.Serv..(144xx)....119

Div..of.Central.Management.and.Support.(14410).......................................................121Div..of.Aging.and.Adult.Services.(14411)....124Div..of.Child.Development.(14420)............126Office.of.Education.Services.(14424)..........128Div..of.Public.Health.(14430).....................131Div..of.Social.Services.(14440)....................135Div..of.Medical.Assistance.(14445).............138NC.Health.Choice.(14446)........................142Div..of.Services.for.the.Blind,.Deaf,.and.Hard.of.Hearing.(14450).....................................143Div..of.Mental.Health/Developmental.Disabili-ties/Substance.Abuse.Services.(14460).........145Div..of.Facility.Services.(14470)..................148Div..of.Vocational.Rehabilitation.(14480)...150

Justice and Public SafetyJudicial.Branch.(12000).................................153Judicial.Branch-Indigent.Defense.(12001).....159Dept..of.Justice.(13600)................................161Dept..of.Juvenile.Justice.and.Delinquency.Pre-vention.(14060).............................................165Dept..of.Correction.(14500).........................168Dept..of.Crime.Control.and.Public.Safety.(14900).........................................................174

Natural and Economic ResourcesDept..of.Agriculture.and.Consumer.Services.(13700).........................................................181Dept..of.Labor.(13800).................................185Dept..of.Environment.and.Natural.Resources.(14300).........................................................187DENR-Clean.Water.Management.Trust.Fund.(14301).........................................................193

iii

Dept..of.Commerce.(14600).........................194Commerce-State.Aid.to.Non-State.Entities.(14601).........................................................198

TransportationOverview............................................................203General.Fund.(14222)........................................206Highway.Fund.(84210)......................................207Highway.Trust.Fund.(84290).............................216

Capital ImprovementsGeneral.Fund.(19600)........................................223Non-General.Fund.(404xx)................................235

Reserves, Debt Service, and Other AdjustmentsGeneral.Fund.(190xx)........................................245

Appendix...............................................................251

iv

List of Figures and Tables

Figures

1. Appropriation for General Fund Operating Budget .............3 2. General Fund Supported Positions ......................................4 3. Savings Reserve Account Balance .........................................9 4. Average Daily Membership Budgeted ................................10 5. Enrollment in Community College System .......................11 6. Enrollment in the University System .................................12 7. Continuation Appropriations by Division, Health

and Human Services .........................................................13 8. Expansion Appropriations by Activity, Health and

Human Services ................................................................13 9. Capital Funding ................................................................1710. Average Teacher Compensation .........................................1911. General Fund Revenue ......................................................2612. Highway Fund Revenue Collections ..................................2713. Highway Trust Fund Revenue Collections .........................3114. Funding Sources, NC Transportation Program ................20415. Appropriations, NC Transportation Program ..................20416. Highway Fund Appropriations ........................................20517. Highway Trust Fund Appropriations ...............................205

Tables

1. General Fund Appropriations ..............................................3 2. General Fund Supported Positions ......................................4 3. Conference-Approved Changes to the General Fund

Budget ................................................................................5 4. Adjustments to Revenue Availability..................................24 5. General Fund Revenue, Actual and Detailed Revised

Estimates...........................................................................25 6. General Fund Revenue, Actual and Revised Estimates .......26 7. Highway Fund ..................................................................29 8. Highway Trust Fund .........................................................33 9. NC Transportation Program ............................................20310. Condition of the Highway Fund .....................................20711. Changes to the Highway Fund Budget ............................20812. Condition of the Highway Trust Fund ............................21613. Highway Trust Fund Appropriations ...............................216

Appendix Tables

1A. Condition of the General Fund ......................................2531B. Condition of the Highway Fund .....................................254

v

1C. Condition of the Highway Trust Fund ...........................2551D. Schedule of the Savings Reserve Account Balance ...........256 2. Total Authorized North Carolina State Budget ...............2573A. Total North Carolina State Budget by Function,

Department, and Source of Funds...................................258 4. Trends in the Total State Budget ......................................261 5. Total Authorized State Budget by Source of Funds ..........262 6. Highway Fund State Tax and Nontax Revenue ................263 7. Highway Trust Fund Tax and Nontax Revenue................264 8. General Fund Tax and Nontax Revenue ..........................265 9. Authorized General Fund Appropriations ........................26610. General Fund Operating Appropriation for Public Schools,

Community Colleges, and Higher Education ..................26711. North Carolina’s Bond Indebtedness ...............................26812. Total North Carolina Budget for Debt Services ...............269

vi

Preface

The North Carolina State Budget: Post-Legislative Budget Summary, 2006-2007 reflects the work of multiple people within the Office of State Budget and Manage-ment (OSBM), including budget administrators and analysts, economists, technical staff, and paraprofes-sionals. The OSBM team is listed below by administra-tive area.

This document is available online at http://www.osbm.state.nc.us. For additional information about its contents, please contact the appropriate administra-tor at the e-mail address cited below or by telephone at 919/807-4700. The mailing address for OSBM is 20320 Mail Service Center, Raleigh, NC 27699-0320.

OSBM Staff

David McCoy, State Budget [email protected]

Debbie Young

Fiscal Office

Arnetha DickersonFrances Doak

Human Resources

Tonya AustinUrsula HairstonJanie JohnsonKatie ShearonCarolyn West

Special Appropriations

Julie Mitchel

Charles Perusse, Deputy State Budget [email protected]

Angela Reeves

Results-Based Budgeting

Jennifer Hoffmann

Capital Projects

Jim Lora, Assistant State Budget [email protected]

Adam BrueggemannChris HarderJennifer Wimmer

Department of Correction, Department of Crime Control and Public Safety, Department of Justice, Department of Juvenile Justice and Delinquency Prevention, Judicial Branch, Statewide Disaster Management

Aaron GallagherMarc NelsonSheryl Stephens

Department of Transportation

Mercidee BentonDanyale Washington

Statewide Information Technology

Jonathan Womer, Assistant State Budget [email protected]

Jim Dolan

Community Colleges, Public Education, University of North Carolina

Elizabeth Grovenstein, Assistant State Budget [email protected]

Bryan ConradKristen CrossonSusie EsealukaPam LeamanTrey O’Quinn

vii

http://www.osbm.state.nc.us

http://www.osbm.state.nc.us

Departments of General Government and Departments of Natural and Economic Resources

David Brown, Assistant State Budget [email protected]

Thomas CheekCelia CoxDonna CoxLanier McReePat Taylor

Economic Forecasting, Revenue Forecasting, Revenue and Tax Issues, Economic Impact of Rules

Nathan KnuffmanWarren Plonk

Department of Health and Human Services

Daphne Lyon, Assistant State Budget [email protected]

Debbie BarnesKari BarsnessPam KilpatrickWayne Williams

Technology and Data Services

Joel Sigmon, Assistant State Budget [email protected]

Bob CoatsSue FarrAgness GunterErnest PecounisFrancine StephensonBill TillmanPaul Young

Management Analysis

Tom Newsome, Assistant State Budget [email protected]

Barbara BaldwinDonald CrookeAngela HoustonSally HunterKay RadfordJoe Turlington

Salary and Benefits

Bill Stockard

Salary Control

Emily Moore

viii

Introduction

The purpose of this document is to describe the budget changes for 2006-07 made by the General Assembly in its 2006 legislative session (referred to as the short ses-sion, which convened on May 9, 2006.) The General Fund and Highway Fund are included, along with the Highway Trust Fund, capital improvements, reserves, debt service, and other adjustments.

Changes are described under one of three categories within a department/budget code or section: continu-ation, expansion, or other provisions. “Continuation” denotes budgets to support current operations, while “Expansion” denotes new programs, expansion of existing programs, and salary and benefit increases. “Other Provisions” is a category for describing other pertinent changes in general statutes or session laws.

For each item of change that is described, there is a report of the resulting fiscal change as well as the change in number of positions, when appropriate.

Fiscal changes are categorized as “Recurring Require-ments” or “Nonrecurring Requirements.” They may also be categorized as “Recurring Receipts” or “Nonre-curring Receipts” to designate changes in departmental receipts. Always, “requirements” less “receipts” equals “appropriation.”

A summary table for the revised budget for 2006-07 is presented at the beginning of each department/budget code or section. In addition, there are summary tables for the items of change following each of the change types, i.e., continuation revisions, expansion revisions, and other provisions. At the end of each department/budget code or section, there is a table that summarizes all revisions.

A summary of the General Asssembly’s changes by department/budget code for the entire state budget appears in table 3, “Conference-Approved Changes to the 2006-07 General Fund Budget.”

1

Governor.Easley’s.priorities.guiding.budget.develop-ment.included.the.following:

Recommending.a.fiscally.responsible.budget.that.replenishes.the.Rainy.Day.Fund,.invests.in.the.state’s.infrastructure,.and.provides.tax.reliefContinuing.our.investments.in.education.from.pre-kindergarten.through.the.university.system.to.build.a.skilled.workforce.prepared.to.compete.in.the.global.economy

•

•

Executive Priorities and Budget Summaryfor 2006-07

Enhancing.North.Carolina’s.aggressive.strategies.for.job.creation.and.long-term.economic.growthProviding.quality.health.and.family.services.to.those.who.can.least.afford.themProtecting.and.preserving.our.natural.heritage.through.land.and.water.conservation,.enforcement.of.our.Clean.Smokestacks.legislation,.and.other.environmental.lawsImproving.the.court.system.and.public.safety.of.our.communities

•

•

•

•

Figure 1

Appropriation for General Fund Operating Budget, 2006-07

University System 13.1%

CommunityColleges 5.0% Public Schools

39.7%

Debt Service and Other Reserves

4.0%

GeneralGovernment and

Natural and Economic

Resources 4.9%

Justice and Public Safety 10.4%Health and Human

Services 22.9%

Public Schools $6,881 $7,399 7.5% 39.7%Community Colleges 828 936 13.0% 5.0%University System 2,151 2,449 13.9% 13.1% Total Education 9,860 10,784 9.4% 57.8%Health and Human Services 4,057 4,279 5.5% 22.9%Justice and Public Safety 1,783 1,938 8.7% 10.4%General Government and Natural and Economic Resources 853 912 6.9% 4.9%Debt Service and Other Reserves 588 747 27.0% 4.0% Total Operating Budget $17,141 $18,660 8.9% 100.0%

Capital Improvements 55 206 274.5% Total General Fund Appropriation $17,196 $18,866 9.7%

Table 1

General Fund Appropriations, 2006-07Compared with Authorized General Fund Appropriations, 2005-06

($ million)

Authorized2005-06

Revised2006-07

Change2005-06 to

2006-07Percent of Total

Operating Budget

3

Figure 2

General Fund Supported Positions2006-07

Health and Human Services 4%

Justice and Public Safety 12%

GeneralGovernment and

Natural and Economic

Resources 3%

Public Schools 62%

CommunityColleges 6%

University System 13%

Public Schools 152,139 156,163 2.6% 61.9%Community Colleges 15,577 15,589 0.1% 6.2%University System 31,904 33,179 4.0% 13.2%Health and Human Services 8,916 9,122 2.3% 3.6%Justice and Public Safety 28,420 29,913 5.3% 11.9%General Government and Natural and Economic Resources 7,894 8,231 4.3% 3.3% Total Positions 244,850 252,197 3.0% 100%

Table 2

General Fund Supported Positions, 2006-07Compared with Authorized General Fund Positions, 2005-06

Authorized2005-06

Revised2006-07

Change2005-06 to

2006-07

Percent of Total

Positions

4

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,929

,956

16

.00

5,95

4,28

0

41

,107

,768

16.0

012

000

Judi

cial

3

45,7

60,4

10

(1,

869,

834)

-

-

18,

044,

710

1

0,91

6,83

6

271

.75

27,0

91,7

12

372,

852,

122

271.

7512

001

Judi

cial

- In

dige

nt D

efen

se

8

8,64

8,41

4

-

-

-

1

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5

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1

.00

6,68

3,12

9

95

,331

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1.00

1360

0Ju

stic

e

7

8,69

7,27

1

-

-

-

1

,435

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3

,270

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16

.00

4,70

6,83

8

83

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16.0

014

060

Juve

nile

Jus

tice

1

38,8

73,1

66

-

-

-

2,9

61,8

19

4

92,7

01

58.0

0 3,

454,

520

142,

327,

686

58.0

0 T

otal

Jus

tice

and

Publ

ic S

afet

y

1

,735

,625

,251

(

1,86

9,83

4)

(9

04,4

30)

-

4

3,78

1,43

4

41,

795,

013

5

15.7

5

82,

802,

183

1,8

18,4

27,4

34

515

.75

Tabl

e 3

Con

fere

nce-

App

rove

d C

hang

es to

the

Gen

eral

Fun

d B

udge

t20

06-0

7

Red

uctio

nsIn

crea

ses

5

2006

-07

App

ropr

iatio

nA

ppro

pria

tion

2006

-07

Net

Bud

get

Cer

tifie

dSu

ppor

ted

Supp

orte

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etA

ppro

ved

Posi

tion

Cod

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nctio

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ppro

pria

tion

Rec

urrin

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onre

curr

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tions

Rec

urrin

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curr

ing

Posi

tions

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nge

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ropr

iatio

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hang

e

Tabl

e 3

Con

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rove

d C

hang

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the

Gen

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udge

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7

Red

uctio

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crea

ses

Nat

ural

and

Eco

nom

ic R

esou

rces

1370

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ricul

ture

and

Con

sum

er S

ervi

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51,

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-

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83

3

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ourc

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168

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100

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4,92

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413

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613,

894

15

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Tot

al N

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ourc

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418

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482

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ansp

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-

-

-

-

-

-

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-

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-

Net

Age

ncy

1

6,24

6,06

2,06

6

(427

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)

(1

5,81

0,89

3)

(1

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0)

600,

777,

038

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1

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47

9,58

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2

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apita

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prov

emen

ts

-

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20

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t Ser

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0)

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(50,

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000)

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616,

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-

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ve

5,00

0,00

0

-

-

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5,00

0,00

0

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ompe

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2

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00,0

00

-

-

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66

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004

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djus

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t Res

erve

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-

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1904

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eser

ve

142

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142,

728,

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298

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r Law

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slat

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537

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4

.00

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58

2,67

3

4.0

0 19

006

UN

C F

acul

ty R

ecru

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and

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-

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1,00

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al R

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and

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stm

ents

529

,335

,205

-

-

-

708,

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12

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9,24

7

5

6.75

833,

727,

331

1,36

3,06

2,53

6

56.

75

Tot

al

$

17,3

96,3

04,7

91

$

(4

27,0

33,6

09)

$

(65,

810,

893)

(10

6.80

) $

1,

309,

505,

122

$

65

2,99

4,87

3

1

,644

.00

$

1,46

9,65

5,49

3 $

18

,865

,960

,284

1,5

37.2

0

6

Major Budget Changesby Subject Area

Fiscal Responsibility

Education

Health and Human Services

Economic Development and

Infrastructure

Courts and Public Safety

Environment and Agriculture

Capital Improvements

Teachers and State Employees

7

Governor.Easley.recommended.a.fiscally.respon-sible.budget.that.included.replenishing.the.Rainy.Day.Fund,.investing.in.the.state’s.infrastructure,.and.providing.tax.relief..The.General.Assembly.enacted.the.following.legislation.in.these.areas.

Save for the Future

Deposited.$324.million.in.the.Rainy.Day.Fund,.thereby.increasing.the.balance.to.$635.million.or.4.0%.of.the.prior.year’s.operating.budget.(see.figure.3).Set.aside.$20.million.for.disaster-related.expenses.

Return Money to North Carolina Taxpayers

Capped.the.gas.tax.on.July.1,.2006.Reduced.the.state.sales.tax.by.0.25%,.effective.December.1,.2006.Reduced.the.top.state.personal.income.tax.rate.by.0.25%,.effective.January.1,.2007.

These.actions.will.save.North.Carolinians.over.$170.million.in.2006-07.

•

•

••

•

Invest in Our Infrastructure

Reserved.$222.million.to.repair.university.and.state.buildings.Appropriated.$206.million.in.“pay-as-you-go”.financing.as.well.as.$700.million.in.special.financ-ing.to.implement.the.Capital.Improvement.Plan.Spent.$42.million.to.replace.and.enhance.the.Hu-man.Resources/Payroll.System.Reserved.$195.million.to.replenish.the.Highway.Trust.Fund.

•

•

•

•

Fiscal ResponsibilityMajor Changes

0

150

267313

635

0

100

200

300

400

500

600

700

2002 2003 2004 2005 2006

Figure 3

Savings Reserve Account BalanceRainy Day Fund

June 30 ($mil)

9

For.education,.Governor.Easley’s.budget.focus.contin-ued.the.state’s.investments.in.education.from.prekin-dergarten.through.the.university.system.to.build.a.skilled.workforce.prepared.to.compete.in.the.global.economy..The.General.Assembly.approved.a.budget.that.supports.the.educational.focus,.as.indicated.below.

Public Education

Provided.a.significant.increase.in.teacher.salaries,.including.a.step.increase.plus.a.flat.$2,250.(for.an.overall.average.of.8%),.while.substantially.increas-ing.the.competitiveness.of.North.Carolina’s.begin-ning.teacher.salary.Provided.an.additional.$231.million.(including.salary.and.retirement.increases).for.public.schools,.a.3.4%.increase.over.2005-06.Continued.funding.for.record.enrollment.increas-es,.projected.at.38,103.or.2.7%.more.than.the.1,397,372.students.enrolled.in.the.2005-06.school.year.(see.figure.4).Fully.funded.the.ABCs.accountability.program.

•

•

•

•

More.than.doubled.the.disadvantaged-student.supplemental.funding.Appropriated.$42.million.to.ensure.full.funding.for.low.wealth.LEAs.whose.ability.to.generate.lo-cal.revenue.per.student.is.below.the.state.average.Expanded.the.governor’s.21st.Century.High.School.program.by.$14.1.million.to.ensure.oper-ating.funds.for.34.Learn.and.Earn.schools.and.32.small.redesigned.high.schools.to.improve.gradua-tion.rates,.student.performance,.and.competitive-ness.in.the.21st.century.Funded.literacy.coaches.for.professional.develop-ment.of.faculty.in.100.middle.schools.to.ensure.student.mastery.of.21st.century.skills.Appropriated.$44.3.million.to.eliminate.the.LEA.discretionary.reduction.Appropriated.$6.million.to.expand.access.to.the.NC.Regional.Education.Network.for.the.state’s.K-12.public.schools.Funded.$2.8.million.for.the.NC.Virtual.Pub-lic.School.to.provide.statewide.access.to.online.courses.and.learning.opportunities.

•

•

•

•

•

•

•

EducationMajor Changes

Source: Department of Public Instruction, Financial and Business Services School Allotment Section

Figure 4

Average Daily Membership BudgetedNC Public Schools

1,150,000

1,200,000

1,250,000

1,300,000

1,350,000

1,400,000

1,450,000

1998-99 1999-00 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-070

0.5

1

1.5

2

2.5

3

Perc

ent C

hang

e

ADM Percent Change

10

Budgeted FTE is the sum of curriculum, continuing education, and basic skills FTE. It is computed as the three-year average or the prior year's enrollment for each college, whichever is higher. The community colleges' enrollments are aggregated for the entire Community College System. (The three-year average creates slight differences between budgeted and actual FTE; recently, this systemwide difference has been less than 100.)

Source: NCCCS System Office

Figure 5

Enrollment in Community College SystemCurriculum, Continuing Education, Basic Skills

Budgeted FTE

-

50,000

100,000

150,000

200,000

250,000

1999-00 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-070%

2%

4%

6%

8%

10%

12%

Per

cent

Cha

nge

FTE Percent Change

Community Colleges

Provided.an.additional.$67.million.(including.salary.and.retirement.increases).for.community.col-leges,.an.8.1%.increase.over.2005-06.Fully.funded.enrollment.growth.(an.additional.$7.1.million).for.all.community.college.campuses.(see.figure.5).Appropriated.a.nonrecurring.enrollment.reserve.of.$1.9.million.to.assist.community.colleges.experienc-ing.fall.semester.enrollment.growth.of.5%.above.the.prior.year.Increased.salaries.for.community.college.faculty.and.professional.staff.by.6%.plus.a.2%.one-time.bonus.to.attract.and.retain.highly.qualified.personnel.Appropriated.$2.5.million.to.improve.and.expand.distance.learning.opportunities,.thereby.increasing.access.for.North.Carolina.students.regardless.of.geography.

•

•

•

•

•

Approved.$10.million.to.address.equipment.needs.at.community.colleges,.including.equipment.to.reduce.program.waiting.lists.Allocated.$500,000.in.financial.aid.to.community.college.students.enrolling.in.teaching.or.nursing.programs.to.address.the.growing.demand.for.these.professionals.Funded.two.new.regional.customized.industry.training.coordinators.to.provide.all.North.Carolina.economic.development.regions.with.training.as-sistance.Provided.for.additional.student.services.and.finan-cial.aid.staffing.at.community.colleges,.enabling.them.to.better.serve.growing.student.enrollments.Appropriated.funds.for.the.State.Board.of.Commu-nity.Colleges.to.direct.start-up.grants.for.new.and.innovative.college.programs.

•

•

•

•

•

11

Source: UNC General Administration

Budgeted FTE is calculated by converting budgeted Student Credit Hours (fall and spring) into the measure of regular term full time equivalent students (FTEs).

Figure 6

Enrollment in the University System Budgeted FTE

-

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

180,000

200,000

1999-00 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-070%

1%

2%

3%

4%

5%

6%

7%

8%

9%

Perc

ent C

hang

e

Enrollment Units (FTE) Percent Change

University System

Appropriated.an.additional.$219.million.(including.salary.and.retirement.increases).for.the.University.of.North.Carolina.system,.a.10.2%.increase.over.2005-06.Fully.funded.university.enrollment.increases.($79.million.for.a.4.1%.FTE.increase).(see.figure.6).Provided.$21.6.million.to.fully.fund.the.need-based.financial.aid.program.Approved.$1.2.million.for.graduate.school.scholar-ships.for.nursing-education.students.to.address.the.growing.demand.for.nurses.in.North.Carolina.Appropriated.$1.million.for.400.additional.pro-spective.teacher.scholarship.loans.Provided.$1.million.to.continue.the.2+2.E-learning.initiative.between.the.University.of.North.Carolina.system.and.community.colleges.in.order.to.make.online.teacher.education.accessible.across.the.state.

•

•

•

•

•

•

Allocated.$1.25.million.for.new.professional.devel-opment.programs.for.teachers.and.principals.Appropriated.$0.5.million.for.the.DESTINY.travel-ing.science.laboratory.to.increase.access.to.state-of-the-art.science.instruction.and.high.quality.profes-sional.development.for.science.teachers.Appropriated.$6.million.for.the.University.of.North.Carolina’s.involvement.in.the.North.Carolina.Kannapolis.Research.Campus.for.a.public-private.partnership.between.the.state.and.Dole.Foods.Appropriated.$2.million.for.focused.growth.cam-puses.and.special.needs.institutions.Expanded.the.Aid.to.Private.Colleges.program.with.a.$100.per.student.increase.for.both.the.Legislative.Tuition.Grant.and.the.State.Contractual.Scholar-ship.Fund..Also.provided.aid.to.part-time.students.who.are.lateral-entry.teachers.or.are.nurses.seeking.additional.certification.

•

•

•

•

•

12

Health and Human ServicesMajor Changes

Figure 7

Continuation Appropriations by Division

Health and Human Services, 2006-07($mil)

2,751

603267 191 151 302

64.5%

14.1%6.3% 4.5% 3.5% 7.1%

-

500

1,000

1,500

2,000

2,500

3,000

Medicaid MH/DD/SAS ChildDevelopment

SocialServices

Public Health All OtherDHHS

Programs

$4,265Total:

Figure 8

Expansion Appropriations by Activity

Health and Human Services, 2006-07($mil)

89

30

1610 8

3 0

0.2%1.9%4.8%6.6%

10.2%

19.4%

56.8%

-

10

20

30

40

50

60

70

80

90

100

MH/DD/SAS ChildDevelpment

At RiskChildren

Public Health EarlyIntervention

Elder Care ResidentialSchools

$157Total:

The.General.Assembly.appropriated.funding.to.in-crease.quality.health.and.family.services.for.those.who.can.least.afford.them..The.approved.budget.included.an.expansion.of.over.$190.million.in.this.area,.with.34%.designated.for.mental.health,.developmental.dis-abilities,.and.substance.abuse.services..Major.changes.are.listed.below.

Supporting the Family

Continued.funding.quality.child.care.services.for.96,000.children.currently.receiving.subsidies,.provided.funds.for.an.additional.3,000.children.of.low-income.working.parents,.and.increased.rates.for.providers.Provided.mental.health.and.social.services.support.to.child.and.family.teams.in.100.schools.across.the.state.Supported.the.nationally.acclaimed.Smart.Start.program.with.over.$13.million.

Supporting Individuals with Special Needs

Provided.$12.million.to.meet.the.increasing.needs.of.children.receiving.foster.care.and.adoption.as-sistance.services.Appropriated.an.additional.$7.million.for.early.intervention.for.children.with,.or.at.risk.for,.devel-opmental.disabilities.

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Continued.funding.services.for.about.5,500.peo-ple.with.developmental.disabilities.threatened.with.loss.of.support.due.to.changes.in.federal.policy..Approved.an.additional.$45.million.investment.in.mental.health.reform.Increased.grants.to.local.programs.to.serve.frail.seniors.who.want.to.remain.in.their.own.homes.Provided.23.new.positions.to.support.preschoolers.and.students.attending.residential.schools.for.the.blind.and.deaf.

Promoting Health

Provided.antiviral.medications.for.first.responders.in.case.of.an.influenza.pandemic.Added.influenza.vaccine.to.the.universal.vaccine.program.Appropriated.$3.25.million.to.support.65.school.nurses.

Controlling Medicaid Expenditure Growth

Reduced.Medicaid.funding.by.$150.million,.primarily.due.to.a.higher.federal.match.rate.and.savings.to.the.state.from.the.new.Medicare.Drug.Plan.

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13

The.General.Assembly.showed.its.commitment.to.fostering.long-term.economic.growth.and.creating.jobs.in.its.adoption.of.the.2006-07.budget..In.addition,.the.adopted.budget.helped.restore.and.maintain.the.state’s.transportation.infrastructure.and.promote.public.tran-sit.initiatives.for.continued.economic.growth.

The One North Carolina Fund

Provided.$15.million.to.recruit.new.businesses.or.support.industries.interested.in.significantly.expanding.in.the.state.

Economic Development Reserve Fund

Provided.$10.million.for.establishing.an.economic.development.reserve.fund.within.the.Department.of.Commerce.to.award.grants.for.site.acquisition.and.economic.development.projects.

The One North Carolina Small Business In-novation Research Program

Appropriated.$5.million.as.incentive.funding.for.small.businesses.to.apply.for.federal.innovation.research.grants.

Promotion of Furniture Market

Provided.$1.75.million.to.promote.the.Interna-tional.Home.Furnishings.Market.in.High.Point.

Motor Sports Program

Funded.the.promotion.of.motor.sports,.an.indus-try.contributing.more.than.$5.billion.annually.to.North.Carolina’s.economy.with.its.24,400.jobs.Established.a.sales.tax.exemption.for.racing-vehicle.components.

Biotechnology

Provided.$2.5.million.for.the.North.Carolina.Biotechnology.Center.to.help.the.state.remain.an.internationally.recognized.biotechnology.leader.Approved.$439,000.for.community.college.bio-technology.programs.

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Appropriated.$4.5.million.for.biomanufacturing.research.and.training.at.North.Carolina.State.Uni-versity.and.North.Carolina.Central.University.

North Carolina as a Business Location

Allocated.$1.million.to.advertise.and.promote.North.Carolina.as.a.location.for.business.and.industry.in.order.to.help.stem.job.losses.and.com-pete.with.neighboring.states.and.foreign.countries.

North Carolina Housing Trust Fund

Added.$5.million.in.recurring.dollars.for.the.Housing.Trust.Fund.to.help.families.secure.safe,.decent,.and.affordable.homes,.create.jobs,.increase.state.and.local.tax.revenues,.and.leverage.millions.of.dollars.in.additional.business.investment.

Transportation

Provided.an.additional.$88.million.(a.47%.in-crease.over.the.previous.year).in.contract.resurfac-ing.funds.to.address.degrading.pavement.condi-tions.Approved.$79.million.for.highway.system.pres-ervation.and.maintenance,.including.pavements,.bridges,.and.traffic.signal.systems.Appropriated.an.additional.$10.million.(a.29%.increase.over.the.previous.year).in.small.urban.construction.funds.for.use.statewide.for.economic.development,.spot.safety,.or.transportation.im-provement.projects.Allocated.a.$9.4.million.increase.(14%.over.the.previous.year).in.public.transportation.funding.to.provide.access.to.dial-a-ride.services.for.citizens,.operating.costs.of.fixed-route.systems,.and.ad-ditional.state.matching.of.federal.funds.for.public.transportation.initiatives.Approved.a.$2.million.increase.in.state.aid.to.assist.rural.airports.with.capital.improvements.critical.to.attracting.new.business.and.industry.to.local.communities.Provided.$2.million.for.short-line.railroad.reha-bilitation.projects.

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Economic Development and InfrastructureMajor Changes

14

Improving.the.court.system.and.community.public.safety.were.key.aspects.of.Governor.Easley’s.budget.recommendations.that.were.funded.in.the.2006-07.budget.enacted.by.the.legislature.

Criminal Investigation Resources

Allocated.$800,000.for.the.State.Bureau.of.In-vestigation.to.fund.new.field.agent.and.crime.lab.positions.to.improve.conviction.rates.related.to.identify.theft,.child.exploitation.on.the.Internet,.and.methamphetamine.and.other.drug.trafficking.Provided.initial.funding.of.$1.9.million.for.needed.replacement.of.the.Statewide.Automated.Finger-print.Identification.System,.which.is.essential.for.solving.crimes.and.conducting.criminal.back-ground.checks.

Public Safety

Included.$650,000.to.fund.emergency.manage-ment.staff.and.logistics.operations.to.improve.emergency.planning,.response,.and.recovery.Provided.$1.5.million.to.enable.the.state.to.moni-tor.convicted.sex.offenders.with.Global.Position-ing.System.technology.and.to.increase.public.awareness.of.offenders.establishing.residency.in.North.Carolina.communities.Added.$950,000.for.additional.State.Highway.Patrol.troopers.and.support.staff.to.reduce.fatal.ve-hicle.collisions.and.increase.enforcement.visibility.Provided.$10.million.for.improved.communica-tions.between.public.safety.agencies.by.expanding.the.statewide.interoperable.voice.radio.network.(VIPER).Appropriated.$2.million.to.expand.prison.bed.capacity.to.meet.current.and.projected.inmate.population.needs.Approved.$150,000.to.ensure.trained.response.teams.are.in.place.statewide.to.protect.the.public.from.incidents.involving.hazardous.materials.Provided.an.additional.appropriation.of.$440,000.for.services.of.urban.search.and.rescue.teams.and.swift.water.rescue.teams.

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Included.$2.2.million.to.expand.services.for.an.alternative.treatment.program..for.delinquent.youth.Funded.$1.7.million.to.help.reduce.repeat.crimi-nal.offenses.by.substance.abusers.

Court System Improvements

Funded.a.$7.6.million.increase.to.expand.the.number.of.prosecutors,.judges,.and.support.staff.to.reduce.case.backlogs.and.process.child.custody.and.criminal.cases.more.expeditiously.Provided.$9.4.million.to.support.new.and.exist-ing.technology.initiatives,.including.a.statewide.warrant.repository,.electronic.filing.for.civil.cases,.an.electronic.traffic.court,.an.electronic.payment.system.for.court.fees,.and.an.automated.evidence.tracking.system.Allocated.$5.8.million.to.improve.overall.operat-ing.efficiency.by.replacing.outdated.technology.and.office.equipment.essential.for.court.opera-tions.Approved.$1.3.million.to.expand.custody.media-tion.and.guardian.ad.litem.programs.to.protect.children.in.custody,.abuse,.and.neglect.cases.Appropriated.$210,000.to.establish.the.nation’s.first.independent.state.panel.to.review.claims.of.wrongful.conviction.

Financial Assistance

Included.$500,000.for.Operation.ROTC.(Reach-ing.Out.to.Children).for.extended.day.care.needed.by.military.dependents.when.spouses.are.deployed.Provided.$1.million.in.additional.funding.for.the.Crime.Victims.Compensation.Fund.so.that.lost.wage.and.hospital.expense.payments.to.victims.of.crime.will.be.awarded.faster.Allocated.$1.5.million.for.grants.to.local.govern-ments.and.community.organizations.to.support.gang.violence.prevention,.intervention,.and.sup-pression.initiatives.

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Courts and Public SafetyMajor Changes

15

In.the.2006-07.budget,.the.General.Assembly.ap-proved.funding.to.protect.and.preserve.the.state’s.natural.heritage.through.land.and.water.conservation.and.through.protection.of.the.food.and.water.supply.

Water Resources

Allocated.$1.million.for.the.expansion.of.the.Con-servation.Reserve.Enhancement.Program.(CREP).into.additional.watersheds.in.need.of.riparian.buf-fers.and.restored.wetlands.Approved.$2.9.million.for.the.Drinking.Water.State.Revolving.Fund.as.a.20%.state.match.for.$14.5.million.in.federal.funds..The.primary.pur-pose.of.the.fund.is.to.provide.low.interest.loans.for.water.supply.infrastructure.improvements.Funded.$3.2.million.to.provide.a.20%.match.as.a.condition.of.the.EPA.Capitalization.Grants.for.the.Clean.Water.State.Revolving.Fund.programs..The.funding.allows.local.governments.to.address.their.wastewater.treatment.needs.more.efficiently.and.to.improve.North.Carolina’s.water.quality.Provided.$1.million.for.private.well.construction..The.funding.supports.the.enforcement.of.stan-dards.for.private.well.construction.and.provides.incentive.funds.for.new.county.well.programs.

One North Carolina Naturally Initiatives

Provided.$277,527.to.establish.four.coastal.habitat.protection.Compliance.Coordinator.positions.to.concentrate.on.permit.monitoring,.enforcement,.and.compliance.activities,.thereby.allowing.exist-ing.field.staff.to.focus.on.permit.delivery.activities.

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Appropriated.$333,778.to.soil.and.water.conser-vation.districts.and.counties.to.implement.best.management.practices.for.water.quality.Approved.$400,000.to.help.agricultural.producers.implement.best.management.practices.on.private.agricultural.lands.to.improve.water.quality.Appropriated.$600,000.to.encourage.private.woodland.owners.to.reforest.their.land.after.harvest.and.to.plant.trees.on.idle.or.unproductive.land,.thus.ensuring.future.timber.supplies.while.providing.environmental.protection.to.the.state’s.woodlands.Provided.$375,000.to.implement.the.Coastal.Rec-reational.Fishing.License.Program.(CRFL).

Agriculture

Approved.$637,000.to.fund.four.positions.to.ad-dress.the.threat.of.avian.influenza,.exotic.New-castle.disease,.bovine.spongiform.encephalopathy,.and.any.other.emerging.or.potential.foreign.animal.diseases.Provided.$538,257.for.eleven.positions.to.provide.increased.protection.of.the.food.supply.by.inspect-ing.slaughterhouses.and.processing.plants.and.surveying.food.samples.Appropriated.$350,000.to.offset.deficits.of.state.farms.in.transitioning.from.production.facilities.to.research.facilities.Approved.$145,310.to.establish.two.Export.Cer-tification.Specialist.positions.to.provide.technical.help.to.North.Carolina.producers.sending.raw.agricultural.products.to.markets.outside.of.the.United.States..

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Environment and AgricultureMajor Changes

16

The.Current.Operations.and.Capital.Improvements.Appropriations.Act.of.2006.included.a.balanced.capital.financing.package,.using.a.combination.of.pay-as-you-go.and.debt.sources..The.2006-07.capital.budget.totaled.approximately.$1.046.billion,.includ-ing.$206.3.million.from.General.Fund.appropriations,.$719.2.million.in.special.financing.spread.over.four.years,.and.$120.7.million.from.receipts..In.addition,.the.legislature.provided.$222.3.million.for.the.Repair.and.Renovation.Reserve.

Education

Appropriated.$140.million.and.authorized.$45.8.million.in.special.financing.for.capital.improve-ment.projects.for.the.UNC.System,.including

$27.million.to.expand.the.School.of.Nursing.at.UNC-Wilmington$61.million.for.the.Engineering.Complex.III.at.North.Carolina.State.University.to.continue.the.relocation.of.the.College.of.Engineering.to.Centennial.Campus$28.4.million.for.planning.and.site.work.for.a.new.Genomics.Science.Building.at.UNC-Cha-pel.Hill$45.8.million.in.special.financing.for.a.new.UNC-Charlotte.classroom.building.to.house.graduate.and.professional.education.programs

Authorized.$529.million.in.self-liquidating.capital.projects.at.the.universities

Public Health

Approved.the.issue.of.$101.million.in.special.financing.to.construct.a.new.public.health.lab.and.office.for.the.Chief.Medical.Examiner.Approved.$20.million.in.special.financing.for.ad-ditional.funding.needed.to.complete.the.Central.Regional.Psychiatric.Hospital.Approved.the.issue.of.$145.5.million.in.special.financing.for.a.new.Eastern.Regional.Psychiatric.Hospital.Approved.$162.8.million.in.special.financing.for.a.new.Western.Regional.Psychiatric.Hospital.

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Appropriated.$8.million.from.the.General.Fund.to.combine.with.a.$16.million.federal.grant.to.construct.two.skilled-care.nursing.homes.for.North.Carolina’s.veterans.

Justice and Public Safety

Provided.$8.5.million.to.construct.an.Emergency.Operations.Center.within.the.new.National.Guard.Readiness.Center.Approved.$151.7.million,.including.$132.million.in.special.financing,.$11.8.million.from.the.Repair.and.Renovation.Reserve,.and.$7.9.million.from.receipts,.to.build.a.Regional.Medical.Center.and.a.Mental.Health.Center.at.North.Carolina’s.Central.Prison.in.Raleigh.

Natural and Economic Resources

Approved.$108.million,.including.$20.million.in.appropriations.and.$88.million.in.federal.and.local.matching.funds,.for.water.resources.develop-ment.projects.Appropriated.$15.million.for.land.acquisition.to.expand.Hickory.Nut.Gorge.State.Park.Provided.$7.5.million.from.the.General.Fund.to.add.to.$16.6.million.in.receipts.to.buy.two.new.container.cranes.for.the.Port.of.Wilmington.Approved.$20.million.in.special.financing.for.state.game.land.acquisition.by.the.Wildlife.Resources.Commission.

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Capital ImprovementsMajor Changes

Figure 9

Capital Funding2006-07($mil)

206.3

719.2

120.7

0

100

200

300

400

500

600

700

800

General Fund Special Financing Receipts

$1,046.2 millionTotal:

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General Government

Approved.$40.million.in.special.financing.to.ex-pand.the.Museum.of.Art.to.showcase.new.collec-tions.and.programs.Approved.$24.8.million.in.special.financing.for.a.new.Secondary.Statewide.Data.Center.to.provide.data.recovery.in.time.of.disaster.and.additional.capacity.for.IT.operations.Appropriated.$1.5.million.in.capital.planning.funds.to.design.the.History.Education.Center.at.Tryon.Palace.Approved.the.issue.of.$20.million.in.special.fi-nancing.for.a.new.parking.deck.in.the.downtown.complex.

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Teachers and State EmployeesMajor Changes

Appropriated.$371.million.as.a.step.increase.plus.a.$2,250.flat.increase.for.public.school.teachers,.equaling.an.average.8%.increase..Provided.an.average.7%.increase.for.principals.and.assistant.principals...Also.provided.$639,113.in.nonrecur-ring.funds.for.school-based.administrators.who.are.at.the.top.of.the.experience-based.salary.schedule,.equivalent.to.a.one-time.lump.sum.bonus.of.2%..(See.figure.10.)Provided.$47.3.million.for.a.6%.annual.salary.increase.and.$14.3.million.in.nonrecurring.funds.for.a.2%.one-time.bonus.for.full-time.permanent.community.college.faculty.and.professional.staff..Also.provided.a.5.5%.annual.salary.increase.for.all.other.community.college.personnel.Provided.$120.3.million.to.support.a.6%.annual.salary.increase.for.full-time.permanent.university.EPA.faculty.and.EPA.nonfaculty.and.a.5.5%.an-nual.salary.increase.for.all.other.university.person-nel.

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Approved.$111.million.for.a.5.5%.salary.increase.for.all.other.full-time,.permanent.employees.of.state.agencies.and.departments.Allocated.$10.8.million.to.add.a.30+.step.to.the.public.school.teacher.salary.schedule,.which.is.2%.higher.than.the.current.29+.step.Provided.$8.6.million.to.increase.the.minimum.salary.of.noncertified.public.education.employees.and.to.support.proportionate.increases.to.per-manent,.full-time.employees.working.schedules.requiring.less.than.12.months’.service.per.year.Allocated.$27.1.million.for.a.3%.cost-of-living.adjustment.(COLA).for.retirees.of.the.Teachers’.and.State.Employees’.Retirement.System.Approved.$30.million.to.repay.funds.withheld.from.the.Retirement.System.in.the.2001-02.budget.crisis..This.repayment.is.the.fourth.in.the.five-year.payback.period.

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Source: 1997-99 to 2005-06 Highlights of the North Carolina Public School Budget February 2006, Information Analysis NCDPI.

Note: 2006-07 to 2008-09 National projections based upon National Education Association figures.

Figure 10

Average Teacher Compensation1998 - 2009

$30,000

$35,000

$40,000

$45,000

$50,000

$55,000

1997-98

1998-99

1999-00

2000-01

2001-02

2002-03

2003-04

2004-05

2005-06

2006-07

2007-08

2008-09

Sala

ry

-2%

0%

2%

4%

6%

8%

10%

12%Pe

rcen

t Cha

nge

NC US NC Percent Change US Percent Change

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Revenueby Topic

General Fund Forecast

Highway Fund

Highway Trust Fund

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RevenueGeneral Fund Forecast

North.Carolina’s.economy.is.projected.to.experience.moderate.and.steady.growth.in.2006-07..The.impetus.for.this.growth.is.strong.employment.gains..Total.net.nonfarm.employment.is.estimated.to.grow.1.5%.in.2006-07..This.growth.is.mainly.fueled.by.stabilization.in.the.manufacturing.sector.and.gains.in.the.services.sector..In.particular,.education.and.health.services.are.expected.to.grow.by.3.3%,.followed.by.gains.of.3.2%.in.professional.and.business.services..As.employment.continues.to.increase,.total.personal.income.is.pro-jected.to.increase.4.7%.in.2006-07.

General.Fund.revenue.is.expected.to.increase.as.North.Carolina’s.economy.continues.to.grow..In.2006-07.baseline.General.Fund.revenue.is.expected.to.increase.by.$698.9.million..After.adjusting.for.the.revenue.changes.during.the.2006.Session.of.the.General.Assembly,.General.Fund.revenue.for.2006-07.is.$18,116.6.million.(see.table.5.for.a.complete.description)..Table.4.details.a.complete.listing.of.the.adjustments.to.revenue.availability.enacted.during.the.2006.session..Major.changes.follow.

Reduction in the state sales tax rate..The.state.general.sales.tax.rate.will.decrease.from.4.5%.to.4.25%.on.December.1,.2006.

2006-07.fiscal.effect:.-$140.1.million

Decrease in top personal income tax rate..The.state.top.personal.income.tax.rate.will.decrease.from.8.25%.to.8.0%.on.January.1,.2007.


Reduction in transfer from Highway Trust Fund..This.transfer.is.required.by.G.S..105-187.9.and.includes.$115.million.to.allow.for.repayment.of.an.outstanding.loan.balance.from.2002-03.


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General Fund Increase or Decrease 2005-06

Adjustment to baseline revenue forecast $698.86

Reduce sales tax rate from 4.5% to 4.25% (140.10)

Reduce top personal income tax rate from 8.25% to 8% (28.60)

Mill rehabilitation income tax credit (2.80)

529 Savings Plan income tax deduction (1.00)

Logging machinery sales tax exemption (2.87)

Internal Revenue Code (IRC) update (5.10)

Joint filing options under personal income tax (1.00)

Railroad cars tax exemption (0.40)

Bill Lee Act changes (1.60)

Extend aviation fuel tax credit (0.09)

Extend real property donation credit (0.10)

Small business health insurance credit (7.20)

Internet facility sales tax exemption (2.25)

Oyster tax credit (0.02)

Gasoline cap reserve (0.37)

Reduce transfer to Highway Trust Fund (195.18)

Adjust transfer from Insurance Regulatory Fund 0.46

Adjust transfer from Treasurer's Office 0.28

Total General Fund $310.93

Table 4

Adjustments to Revenue Availability, 2006-07 2006 Short Session of the General Assembly

($ million)

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2005-06 2005-06 2006-07 2006-07Certified Actual Certified Revised

Budgeted Budgeted Estimate Tax Revenue

Individual Income $ 8,839,760,000 $ 9,400,167,970 $ 9,399,150,000 $ 9,635,400,000 Corporate Income 905,940,000 1,204,102,940 910,870,000 1,052,500,000 Sales and Use 4,692,700,000 4,893,911,220 4,915,325,000 5,032,500,000 Franchise 493,800,000 477,055,108 520,450,000 504,900,000 Insurance 441,700,000 431,729,295 485,600,000 491,900,000 Tobacco Products 161,274,000 171,636,758 231,171,000 238,200,000 Beverage 195,950,000 200,845,242 202,550,000 209,100,000 Inheritance 137,900,000 133,379,473 139,300,000 139,200,000 Licenses 46,300,000 45,569,504 47,500,000 46,000,000 Mill Machinery 16,600,000 11,951,991 40,000,000 31,200,000 Piped Natural Gas 35,500,000 33,654,268 35,900,000 33,100,000 Gift 20,000,000 16,237,070 22,500,000 17,600,000 Freight Car Lines 540,000 269,931 540,000 200,000 Miscellaneous 560,000 5,032 560,000 300,000

Total Tax Revenue $ 15,988,524,000 $ 17,020,515,802 $ 16,951,416,000 $ 17,432,100,000

Nontax RevenueInvestment Income 74,800,000 119,143,785 78,700,000 124,400,000 Judicial Fees 161,725,771 159,102,325 168,605,271 164,000,000 Disproportionate Share Receipts 100,000,000 100,000,000 100,000,000 100,000,000 Insurance Department 49,889,013 54,007,923 51,543,813 53,200,000 Miscellaneous 188,801,932 169,020,577 202,719,921 185,374,232

Total Nontax Revenue $ 575,216,716 $ 601,274,610 $ 601,569,005 $ 626,974,232

TransfersHighway Fund 2,200,000 - - -Highway Trust Fund 252,558,117 252,558,117 252,663,009 57,500,000

Total Transfers $ 254,758,117 $ 252,558,117 $ 252,663,009 $ 57,500,000

Total General Fund Revenue $ 16,818,498,833 $ 17,874,348,529 $ 17,805,648,014 $ 18,116,574,232

Table 5

General Fund RevenueActual Revenue for 2005-06 and Detailed Revised Estimates for 2006-07

Totals may differ from the sum of their parts due to rounding.

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Figure 11

General Fund RevenueRevised Estimates for 2006-07

Individual Income Tax 53%

Corporate Income Tax 6%

Sales and Use 28%

Franchise 3%

Insurance 3%Other Tax Revenue

4%

Highway Trust Fund Transfer 0%

Nontax Revenue 3%

PercentChange

2005-06 2005-06 2006-07 2006-07 2005-06 toBudget Actual Difference Budget Revised Difference 2006-07

Individual Income Tax 8,840 9,400 560 9,399 9,635 236 2.5%Corporate Income Tax 906 1,204 298 911 1,053 142 -12.6%Sales and Use 4,693 4,894 201 4,915 5,033 117 2.8%Franchise 494 477 (17) 520 505 (16) 5.8%Insurance 442 432 (10) 486 492 6 13.9%Other Tax Revenue 615 614 (1) 720 715 (5) 16.5%Nontax Revenue 575 601 26 602 627 25 4.3%Highway Trust Fund Transfer 255 253 (2) 253 58 (195) -77.2%

Total Revenues 16,818 17,874 1,056 17,806 18,117 311 1.4%Unreserved Credit Balance 771

Total Availability 18,888

Table 6

General Fund RevenueActual for 2005-06 and Revised Estimates for 2006-07, ($mil)

Totals may differ from the sum of their parts due to rounding.

26

The Highway Fund receives support from three revenue sources. The first and primary source is from the excise tax on motor fuels collected by the Depart-ment of Revenue. The Highway Fund receives 75% of the excise tax on motor fuels. (The remaining 25% is deposited with the Highway Trust Fund.) The second source of revenue comes from licenses and fees collect-ed by the Division of Motor Vehicles. The third source is from interest on investments of fund cash balances by the State Treasurer.

Total Highway Fund revenues for fiscal year 2004-05 were $1,409.3 million. This amount is an increase of 3.4% over the previous fiscal year. Motor fuel taxes and licenses and fees increased 2.7% and 5.6%, respec-tively, compared to 2003-04, while investment income declined 17.3%.

Actual Highway Fund collections for fiscal year 2005-06 totaled $1,671.4 million. This figure is an 18.6% increase in revenue over fiscal year 2004-05. The growth can be contributed to several factors. First, the excise tax on motor fuels was higher due to the

increase in the variable rate component of the tax. Sec-ond, retail fuel prices were higher, and third, by actions of the 2005 General Assembly many of the licenses and fees were increased effective October 1, 2005.

Revenues from taxes related to motor fuels, including the excise tax on motor fuels, increased 14.2% in fiscal year 2005-06. A large part of this increase is attrib-uted to the increase in the excise tax on motor fuels and to consistent increases in the retail price of motor fuels. However, North Carolina motorists curbed their appetite for motor fuels by only 0.76% for fiscal year 2005-06. The excise tax on motor fuels was increased from 27.1 cents per gallon to 29.9 cents per gallon beginning in January 2006.

The excise tax rate is adjusted twice a year in July and January. This adjustment of the variable rate compo-nent is based on a six-month weighted average of the average wholesale price of motor fuels. In order to provide some relief to North Carolina motorists, the Governor recommended and the General Assembly ap-proved in the 2006 session the freezing of the variable

RevenueHighway Fund

Total excludes transfers to or from the General Fund

Figure 12

Highway Fund Revenue Collections2006-07

Other Licenses and Fees 2.7%

InvestmentIncome 0.5%

Truck Licenses 6.6%

Motor Fuel 67.1%Gasoline

Inspection and Highway Usage

Registration 0.9%

StaggeredRegistration

12.2%

InternationalRegistration Plan

(IRP) 3.8%

Driver Licenses 6.3%

27

component of the excise tax on motor fuels at 12.4 cents per gallon. This freeze caps the tax rate at 29.9 cents for the period July 1, 2006, through June 30, 2007. In order to hold the Highway Fund harmless from cap-ping the rate for 2006-07, the legislature approved the transfer of $17.6 million from the General Fund to the Highway Fund.

The revenue from licenses and fees for fiscal year 2005-06 increased 28% over fiscal year 2004-05. The majority of this increase can be attributed to a sweeping increase in most of the licenses and fees administered by the Division of Motor Vehicles. The fee package authorized by the General Assembly, effective October 1, 2005, was estimated to have an impact of $106 million on revenue collections for the remaining nine months of the fiscal year. However, actual Highway Fund revenues for fiscal year 2005-06 increased 2.7% over the forecast.

Total Highway Fund revenues for fiscal year 2006-07 are expected to increase 5.7%. This amount results from some economic growth and a full twelve months of col-lections at the new license and fee levels.

28

2004-05 2005-06 2006-07Source Actual Actual Revised

Motor Fuels Taxes Motor Fuels $961,268,000 $1,100,649,000 $1,173,390,000 Gasoline Inspection 15,196,000 14,845,000 15,300,000 Highway Use Registration Fee 204,000 214,000 160,000 Total Motor Fuel Taxes 976,668,000 1,115,708,000 1,188,850,000 Percent Change from Previous Year 2.7% 14.2% 6.6%

Licenses and Fees Staggered Registration 160,037,000 187,563,000 212,940,000 International Registration Plan 49,790,000 66,013,000 66,230,000 Driver Licenses 79,370,000 110,493,000 111,040,000 Truck Licenses 71,265,000 126,061,000 114,740,000 Other Licenses and Fees 62,612,000 51,479,000 47,740,000 Total License and Fees 423,074,000 541,609,000 552,690,000 Percent Change from Previous Year 5.6% 28.0% 2.0%

Investment Income 9,525,000 $14,090,000 8,000,000 Percent Change from Previous Year -17.3% 47.9% -43.2%

Total Highway Fund Revenue 1,409,267,000 1,671,407,000 1,749,540,000 Percent Change from Previous Year 3.4% 18.6% 4.7%

Transfer from General Fund1 17,600,000

Total Highway Fund Availability $1,409,267,000 $1,671,407,000 $1,767,140,000 Percent Change from Previous Year 3.4% 18.6% 5.7%

1 Transfer from General Fund to hold Highway Fund harmless from capping variable component of Motor Fuels Tax at the January 1, 2006 rate for 2006-07.

Table 7

Highway FundRevisions, 2006-07

Revenue Availability

29

RevenueHighway Trust Fund

Total excludes transfers to or from the General Fund

Figure 13

Highway Trust Fund Revenue Collections2006-07

Interest on Investments 0.2%

MiscellaneousTitle Fees 1.6%

Certificate of Title Fees 8.5%

Highway Use 53.9%

Motor Fuels Tax 35.7%

The Highway Trust Fund was established in 1989 and receives support from four sources. The first source is 25% of the excise tax on motor fuels. The second and primary source is the highway use tax or the sales tax on most noncommercial vehicle sales. The third and fourth sources are title fees, such as the certificates of title and other miscellaneous title-related fees, and the interest earned from investments of the Trust Fund cash balance by the State Treasurer.

Total Highway Trust Fund revenues for fiscal year 2004-05 were $1,003.9 million. This amount is an in-crease of 0.9% over the previous fiscal year. Excluding interest on investments, the revenues collected from the motor fuel tax and motor vehicle fees increased 1.3% over 2003-04. Investment income alone declined 35.6% in fiscal year 2004-05.

Actual Highway Trust Fund collections for fiscal year 2005-06 totaled $1,051.3 million. This figure is a 4.7% increase in revenue over fiscal year 2004-05. Excluding interest on investment, growth was 5.2% for the period. The majority of the growth can be at-

tributed to three factors. First, the excise tax on motor fuels was higher. Second, retail fuel prices were higher, and third, the 2005 General Assembly increased title fees under the Highway Trust Fund, effective October 1, 2005.

A large part of the 5.2% increase for fiscal year 2005-06 can be attributed to an increase in the variable rate component of the excise tax on motor fuel. The increase resulted in the tax rate rising from 27.1 cents per gallon to 29.9 cents per gallon, effective January 1, 2006. At the same time, the retail price of motor fuels continued to increase, and North Carolina motorists responded by only slightly curbing their appetite for motor fuels by 0.76%.

The excise tax rate is adjusted twice a year in July and January. This adjustment of the variable rate compo-nent is based on a six-month weighted average of the average wholesale price of motor fuels. In order to provide some relief to North Carolina motorists, the Governor recommended and the General Assembly ap-proved in the 2006 session the freezing of the variable

31

component of the excise tax on motor fuels at 12.4 cents per gallon. This freeze caps the tax rate at 29.9 cents for the period July 1, 2006, through June 30, 2007. In order to hold the Highway Trust Fund harmless from capping the rate for 2006-07, the legislature approved the transfer of $5.7 million from the General Fund to the Highway Trust Fund.

Most of the Highway Trust Fund title fees authorized in the 2005 Session of the General Assembly had not been increased since the Highway Trust Fund was established in 1989. The fee package, effective October 1, 2005, was estimated to have an impact of $13.4 million for the remaining nine months of fiscal year 2005-06. Unfortunately, the expected revenue increase from the fee package failed to meet forecast, and combined with a tremendous decline in the highway use tax due to declining motor vehicle sales, the forecast for fiscal year 2005-06 fell short by 4%.

For revised fiscal year 2006-07, the transfer of $252.6 million from the Highway Trust Fund to the General Fund, pursuant to G.S. 105-187, was reduced to $57.5 million. This change allows for a total of $195.2 mil-lion, which includes $115 million for repayment of an outstanding loan balance from fiscal year 2002-03.

Overall, growth in the Highway Trust Fund for fiscal year 2006-07 is expected to increase by 4% as a result of some economic growth and twelve months of collec-tions at the new fee levels.

32

2004-05 2005-06 2006-07Source Actual Actual Revised

Motor Fuels Tax $320,411,000 $366,458,000 $391,300,000Highway Use 580,118,000 577,237,000 590,400,000Certificate of Title Fees 84,653,000 90,286,000 93,580,000Miscellaneous Title Fees 12,242,000 15,800,000 17,150,000Subtotal 997,424,000 1,049,781,000 1,092,430,000 Percent Change from Previous Year 1.3% 5.2% 4.1%

Interest on Investments 6,485,000 1,499,000 2,500,000 Percent Change from Previous Year -35.6% -76.9% 66.8%

Total Highway Trust Fund Revenue 1,003,909,000 1,051,280,000 1,094,930,000

Percent Change from Previous Year 0.9% 4.7% 4.2%

Transfer from General Fund1 - - 5,700,000Total Highway Trust Fund Availability 1,003,909,000 1,051,280,000 1,100,630,000

Transfer to General Fund2 - - 57,486,602Highway Trust Fund Balance Available $1,003,909,000 $1,051,280,000 $1,043,143,398 Percent Change from Previous Year 0.9% 4.7% -0.8%

Table 8

Highway Trust FundRevisions, 2006-07Revenue Availability

1 Transfer from General Fund to hold Highway Trust Fund harmless from capping variable component of Motor Fuels Tax at the January 1, 2006 rate for 2006-07.2 Transfer required by G.S. 105-187.9 (Includes reduction of $115 million to allow for repayment of outstanding loan balance from 2002-03).

33

RevisedAppropriations

Education

General Fund

35

Public Education (13510)

Total Appropriations and Positions

2006-07Certified

2006-07 Revised

PercentageChange

Requirements $7,652,962,737 $7,921,569,677 3.5 %

Receipts 1,073,155,640 1,201,818,559 12.0 %

Appropriation $6,579,807,097 $6,719,751,118 2.1 %

Positions 507.200 512.200 1.0 %

Appropriation Items -- Legislative Revisions and Other Adjustments

Continuation 2006-07

Technical Adjustments 1. Average Daily Membership (ADM)

The Governor recommended and the General Assembly appropriated funds to support an increase in average daily membership (ADM) of 18,363. Positions, textbooks, instructional equipment, and supplies allocated to the public schools are budgeted on the basis of the average daily membership of students in the classroom.

Requirements $76,757,787

Receipts $457,971

Appropriation $76,299,816

2. Average Annual Salary Adjustment

Budgeted average annual salaries are typically revised using actual 2005-06 sixth pay period salaries as the base. This adjustment is made annually. Due to turnover in positions, actual salaries are lower than budgeted salaries and a reduction is made accordingly. The General Assembly increased the adjustment to reflect 2005-06 tenth pay period salaries.

Appropriation ($71,776,440)

Post-Legislative Budget Summary, 2006-07 General FundPublic Education


37

3. Reprogram Class Size Appropriation

The Governor recommended and the General Assembly approved the reprogramming of $127.9 million of the 2006-07 budget for class size reduction to proceeds from the North Carolina Education Lottery. (2006 Session Laws, Chapter 66, Section 6.15.)

Requirements -

Receipts $127,864,291


4. Exceptional Children

The budgeted funding for children with special needs is revised to reflect the actual April 1, 2006 headcount. The adjustment does not reduce the funding per student.


5. Transfer More at Four Program and Office of School Readiness

The More at Four program and the Office of School Readiness are transferred to the Department of Public Instruction (DPI) effective July 1, 2006. This transfer will have the elements of a Type I transfer as defined by G.S. 143A-6. An Executive Director will be appointed by the State Board of Education. DPI shall implement a plan to expand More at Four program standards within existing resources to four- and five-star rated centers and schools serving four year olds. Support of existing More at Four classrooms with More at Four funding is permitted when current funding is eliminated or reduced to meet other specified federal or state educational mandates. (2006 Session Laws, Chapter 66, Section 7.18.)

6. Budget Receipts from the NC Education Lottery for More at Four

Receipts from the NC Education Lottery Fund in the amount of $66,646,653 are budgeted to support the More at Four program in accordance with North Carolina General Statutes. In addition, receipts in the amount of $17,989,056 from lottery proceeds will support program expansion, which includes creation of 3,200 additional program slots, increased funding of $200 per slot for all 18,653 slots, and five new receipt-supported positions. The More at Four positions are an Educational Development and Planning Consultant II, Educational Consultant II, and Education Processing Assistant. The Department of Public Instruction (DPI) positions are an Accounts Payable Clerk I and Accountant I. (2006 Session Laws, Chapter 66, Section 6.15.)

7. Adjust Projected Receipts from Civil Penalties and Forfeitures

Funds are provided to adjust the projected collections in the Civil Penalties and Forfeitures Fund. The revised amount of receipts budgeted from the fund to support public school operations in 2006-07 is $95 million. (2006 Session Laws, Chapter 66, Section 6.37 (b).)




38

8. Budget Receipts from Teaching Fellows Trust Fund

Receipts are budgeted from the Teaching Fellows Trust Fund to support administration of the Teaching Fellows program. This reduces the General Fund appropriation to the Public School Forum accordingly. The Public School Forum may use up to $810,000 for the administration of the program to expand minority recruitment, and to expand to up to four additional public or private university or college campuses. (2006 Session Laws, Chapter 66, Section 7.19.)

Requirements -

Receipts $340,657

Appropriation ($340,657)

Total Revised Continuation Recurring Requirements $28,725,817

Receipts 128,662,919


Number of Positions -

Nonrecurring

Requirements -

Receipts -

Appropriation -


Expansion 2006-07

State Public School Fund 1. Restore Base Budget Funding

The full base budget is restored by eliminating the recurring discretionary reduction to local education agencies (LEAs). This reduction was implemented beginning in 2001-02 through the 2001 Session Laws, Chapter 424, Section 28.38.




39

2. Low Wealth Supplemental Funding

The Governor recommended and the General Assembly appropriated funds to fully support the Low Wealth Funding allotment. The Low Wealth formula provides supplemental funds based on a county's ability to generate revenue to enhance the instructional program and student achievement throughout the state. This appropriation increases the funding to local education agencies (LEAs) with below state-average ability to raise local revenue for public schools. The use of the funds distributed through this formula is restricted to those items described in 2005 Session Law, Chapter 276, Section 7.6 (b). Local boards of education are required to report annually to the State Board of Education on funds used for this purpose.


3. Disadvantaged Student Supplemental Funding (DSSF)

The Governor recommended additional supplemental funding to be distributed to all LEAs to support their efforts to serve students who are most at risk of academic failure. The General Assembly appropriated $27 million for this purpose. Beginning in 2006-07 all DSSF funds will be distributed on a formula that takes into account each LEAs relative need. The sixteen LEAs that received DSSF funds in 2005-06 will receive no less than the DSSF amount allotted to them in 2005-06. (2006 Session Laws, Chapter 66, Section 7.10.)


4. Evaluate Effectiveness of DSSF and Low Wealth Initiatives

The Governor recommended additional funds to support comprehensive evaluation of the extent to which LEAs use DSSF and Low Wealth supplemental allotments to improve student outcomes for students at risk of school failure. The General Assembly appropriated $500,000 on a nonrecurring basis.

Appropriation - Nonrecurring $500,000

5. Exceptional Children

The General Assembly appropriated funds to increase the per student funding by $5.87. This per student increase for the 170,240 funded headcount will result in revised per student amount of $2,972.52. (2006 Session Laws, Chapter 66, Section 7.7.)


6. School-Based Incentive Awards Under the ABCs Program

The Governor recommended and the General Assembly appropriated nonrecurring funds in the amount of $90 million to support the ABC bonuses for schools that met or exceeded expected academic growth in the 2005-06 school year. The ABCs initiative directs that each year a school must assure that students receive a year's worth of education for a year of instruction. This appropriation maintains the current incentive levels based on the implementation of the new growth model. (2006 Session Laws, Chapter 66, Section 7.6 (a).)

Appropriation - Nonrecurring $90,000,000

7. Learn and Earn Initiative

The Governor recommended funds to expand the Learn and Earn program from 13 to 34 high schools in 2006-07. The General Assembly approved $8.2 million recurring and $1.4 million nonrecurring. The funds will support program staff in each school and operating expenses to support students in preparing for the workforce and college. The nonrecurring appropriation provides funds for start-up costs, 20 planning grants for schools that will become operational in academic year 2007-08, and will support the cost of four months principal's salary for each Learn and Earn planning site prior to becoming operational in the 2007-08 academic year. Allowable uses of these funds include university tuition, and the cost of books and specified fees for students enrolled in courses at a partnering university or community college. The State Board of Education will allot funds after verification of the



40

credit hour enrollment of Learn and Earn students. (2006 Session Laws, Chapter 66, Section 7.11.)



8. Small Specialty High Schools

The Governor recommended and the General Assembly approved funds to support one additional principal, guidance counselor, and two clerical staff at 11 new sites, resulting in 21 new redesigned high schools in 2006-07. This will bring the total number of small specialty schools to 32. The nonrecurring appropriation will support 10 planning grants in schools where the instruction is specifically redesigned around the following curricula: science, technology, engineering, and/or math (STEM). Nonrecurring funds also include $261,680 to support four months principal's salary for each planning site prior to becoming operational in the 2007-08 academic year.



9. Virtual High School

The Governor recommended and the General Assembly appropriated funds to the State Board of Education to support 2006-07 implementation of North Carolina Virtual Public Schools (NCVPS) initiatives identified during the pilot phase conducted in 2005-06. This appropriation includes the cost of seven administrative and support positions or contracted employees, 22 instructional staff positions for three months in preparation for 2007-08 academic year; and operating support. The Director will ensure that e-learning opportunities offered by state-fund entities are consolidated, and will prioritize e-learning offerings for students residing in rural and low wealth county LEAs to expand instructional opportunities. The State Board of Education is charged with developing an allotment formula to fund e-learning for the 2007-08 fiscal year. (2006 Session laws, Chapter 66, Section 7.16.)



10. School Connectivity

The Governor recommended and General Assembly appropriated funds to upgrade public school connectivity as part of efforts to establish a comprehensive pre-kindergarten through higher education NC Regional Education Network, expand the number of the state's K-12 public schools broadband connectivity, enhance development of regional broadband networks, enhance use of technology as an instructional tool, and revise school technology plans. Funds not expended by June 30, 2007 shall be carried forward for expenditure in FY 2007-08. A maximum of $300,000 may be transferred to the Office of the Governor to establish NC Virtual within the Education Cabinet. These funds may be used to contract for services to coordinate e-learning activities across all state education agencies.


11. 21st Century Literacy Coaches

The Governor recommended and the General Assembly approved an appropriation to support hiring 100 school-based literacy coaches to be placed in 100 middle schools (or other public schools with an eighth grade) with the lowest average scores on the eighth grade end-of-grade reading test for the most recent three years. Coaches will provide research-based teaching practices and job-embedded professional development to assist



41

teachers in the development of curricula that enable students to develop mastery of 21st century skills. Funds for training the coaches are in the University of North Carolina budget. (2006 Session Laws, Chapter 66, Section 7.13.)


12. Salary Supplement for Math and Science Teachers

The General Assembly appropriated funds for a salary supplement pilot to be developed by the State Board of Education. Three pilot LEAs will receive funds to provide a salary supplement of $15,000 for up to 10 newly hired math and/or science teachers at the middle and/or high school level. The appropriation includes salary and benefit costs. (2006 Session Laws, Chapter 66, Section 7.21.)

Appropriation $515,115

13. NCWISE

The General Assembly appropriated funds to support new short-term contracts required to complete the development of the statewide North Carolina Window of Information on Student Education (NCWISE) system. The State Board of Education may, in consultation with the Office of Information Technology Services (ITS) use funds appropriated to create a maximum of twenty positions and incur expenditures necessary to transfer the maintenance and administration of the NCWISE system from the vendor to the Department of Public Instruction. (2006 Session Laws, Chapter 66, Section 7.12.)


14. Teacher and Administrator Compensation

The Governor recommended and the General Assembly appropriated funds to be placed in the Compensation Reserve for employees paid on the teacher salary schedule or the principal and assistant principal salary schedule in schools operated by local boards of education, the Department of Health and Human Services, the Department of Correction, the Department of Juvenile Justice, and the North Carolina School of Science and Mathematics. These funds will provide for movement on the salary schedule based on years of experience, and will increase the salary schedule base by $2,250. Teachers will receive an average increase of 8% and administrators 7% in 2006-07. Principals and assistant principals at the top of their salary schedule and who therefore do not receive a step increase shall be paid a one-time bonus. The funds for this are shown in the Reserves Section of this document.

Department of Public Instruction 1. Legacy System Migration and Upgrade

The Governor recommended and the General Assembly approved a reserve of funds to be used to bring DPI's information technology applications into compliance with statewide architecture requirements. DPI must obtain approval of the State Chief Information Officer prior to the expenditure of funds for this project. Funds may be carried forward into 2007-08. Any unused funds will revert to the General Fund on June 30, 2008.


2. Network Tool Replacement

The Governor recommended and the General Assembly approved funds to support the cost of migrating DPI from a network tool that will no longer be supported by Information Technology Services (ITS) to a tool that will be supported by ITS, effective June 2007.




42

3. Information Technology Security Analyst

The Governor recommended and the General Assembly approved a recurring appropriation of $40,000 to support a half-time IT security analyst position. The position will assist in the development of a security program and the execution of the department's security charter to ensure compliance with federal regulations and state statute. The recommended appropriation includes salary and benefits in the amount of $38,467, plus operating costs.


Number of Positions .500

4. Business Continuity Planning Analyst

The Governor recommended and the General Assembly approved a recurring appropriation to support a half-time business continuity planning analyst position.


Number of Positions .500

5. Business Technology Applications Analyst

The Governor recommended and the General Assembly approved a position to be supported by federal receipts to serve exclusively on the Exceptional Children's (EC) project team. The EC delivery team is responsible for seven software systems in addition to the large, statewide technology system for exceptional children (CECAS).

6. Purchasing Agent

The Governor recommended and the General Assembly approved funds to support a Purchasing Agent II position to meet workload demands.


Number of Positions 1.000

7. Director of High School Turnaround

The Governor recommended and the General Assembly approved a recurring appropriation to fund a position to coordinate assistance activities in school districts. The responsibilities of the director will be to plan, organize and implement activities that focus on improving the performance of designated high schools in medium and small districts that have performance composites below 60%. The department is currently contracting for these services. The recommended expansion amount supports the current costs plus $11,000 for operating expenses.



8. Office of Charter Schools

Funds were appropriated to replace decreased federal funding that had previously supported one administrative assistant. This recurring appropriation will also support one new education planning and development consultant, and the general operations of the Office of Charter Schools.





43

9. State Board of Education Operating Support

The Governor recommended funds to support the operations of the expanded State Board of Education. The General Assembly appropriated $50,000 nonrecurring.


10. NC WiseOwl

The General Assembly appropriated funds to support the increased costs of statewide subscriptions to online library resources that are made available to all students and teachers.


Expansion Pass-Through Funds 1. Communities in Schools

The Governor recommended funds to support Communities in Schools. The General Assembly appropriated nonrecurring funds in the amount of $1 million. The program connects at-risk students and their families with resources to assist in school success and dropout prevention.


2. NC Network

The Governor recommended funds to support NC Network which provides training for school-based management teams to improve the capacity of local administrative units. The General Assembly appropriated nonrecurring funds in the amount of $50,000.


3. Teach for America

The Governor recommended and the General Assembly appropriated funds in the amount of $200,000 for the Teach for America (TFA) program. These funds will support TFA's efforts to recruit teachers for hard-to-staff schools in North Carolina.


4. NC Humanities Council Teacher Institute Program

The General Assembly appropriated nonrecurring funds in the amount of $100,000 for this nonprofit that develops teachers' capacity to understand, empathize with, and relate to various cultures.


5. ExplorNet

The General Assembly appropriated nonrecurring funds in the amount of $100,000 to this nonprofit, which promotes effective use of information technology in the public schools.


6. Futures for Kids

This appropriation provides additional funds to the nonprofit that enhances schools' capacities to provide students with opportunities for career exploration. Funds will be disbursed once the Futures for Kids program has consolidated operations with the career exploration services provided by the College Foundation of North Carolina (CFNC). Futures for Kids and the CFNC shall report to the Joint Legislative Education Oversight Committee and the Joint Legislative Commission on Governmental Operations on a consolidation plan prior to the execution of that plan.




44

7. Project Enlightenment

The General Assembly appropriated nonrecurring funds in the amount of $50,000 for Wake County to assist in the continuation of its model Demonstration Preschool program, and consultation and education services to children, families, and other professionals.


8. Kids Voting NC Funds

This appropriation provides $250,000 in nonrecurring funds to Kids Voting of North Carolina, Inc., a nonprofit corporation. A maximum of $50,000 may be used to implement new Kids Voting programs across the state. The balance shall be allocated on the basis of the North Carolina Department of Public Instruction's ADM with a minimum of $2,500 for the following counties: Buncombe, Cabarrus, Catawba, Clay, Cumberland, Davie, Durham, Greene, Guilford, Haywood, Henderson, Iredell, Jackson, Lee, Madison, Mecklenburg, New Hanover, Onslow, Randolph, and Wake to assist those counties with their Kids Voting programs.


Total Revised Expansion Recurring Requirements $134,721,101

Receipts -



Nonrecurring


Receipts -



Other Provisions 2006-07

Special Provisions 1. Education Lottery Fund and Appropriations

Revenue used to support appropriations made in this act are transferred from the State Lottery Fund in the amount of $425 million dollars for the 2006-07 fiscal year. The funds are distributed as follows: Class Size Reduction $127,864,291; Prekindergarten Program $84,635,709; Public School Building Capital Fund $170,000,000; and Scholarships for Needy Students $42,500,000. (2006 Session Law, Chapter 66, Section 6.15 (a).)

2. Funds for Increased Fuel Costs

The State Board of Education may use any funds appropriated for State Aid to Local School Administrative Units to cover increases in fuel costs. (2006 Session Laws, Chapter 66, Section 6.16.)



45

3. Noncertified Personnel Salary and Fair Minimum Pay

Effective July 1, 2006, all permanent full-time noncertified public school employees whose salaries are supported by the state's General Fund shall be paid a minimum salary of at least $20,112 per year. Permanent full-time employees working on a schedule requiring less than 12 months service per year and permanent part-time employees shall receive a pro rata share. The fair minimum wage salary adjustment shall be calculated and awarded after the 5.5% across-the-board salary increase. (2006 Session Laws, Chapter 66, Sections 7.4 (a)-(d).)

4. Amend Civil Penalty and Forfeiture Fund Availability

Appropriations are made from the Civil Penalty and Forfeiture Fund for 2006-07 as follows: School Technology Fund $18 million and State Public School Fund $77.5 million. (2006 Session Laws, Chapter 66, Section 6.37 (b).)

Total Revisions for Public Education

2006-07 Recurring





Nonrecurring


Receipts -





46

The University of North Carolina (160xx)


2006-07Certified

2006-07 Revised

PercentageChange

Requirements $3,044,371,616 $3,186,610,183 4.7 %

Receipts 923,974,535 937,555,205 1.5 %

Appropriation $2,120,397,081 $2,249,054,978 6.1 %

Positions 32,055.420 31,988.620 (0.2)%



Technical Corrections 1. Building Reserves Adjustment

The Governor recommended and the General Assembly approved adjustments to schedules in constructing or renovating facilities at constituent institutions of the UNC System for funds that had been appropriated in 2006-07 for building reserves. Some campuses have buildings for which scheduled completion is later than the original date for which building reserves were approved. The budgets for the monthly operating costs are being reduced or increased according to the updated anticipated activation dates. A second adjustment is for replacing one-time appropriations lost during the 2005 session when some building reserves were moved from 2005-06 to 2006-07. These one-time costs include initial police officer supplies, equipment, moving costs and initial cleaning supplies.

Appropriation - Nonrecurring ($9,595,070)

Number of Positions (91.800)

2. Restore NC A&T's Library Book Inflation Increase

The Governor recommended and the General Assembly approved restoring NC A&T's library book inflationary increase for 2006-07, which was accidentally removed from the 2005-07 continuation budget.


3. Restore NC A&T's Utility Inflation Increase

The Governor recommended and the General Assembly approved restoring NC A&T's utility inflationary increase for 2006-07, which was accidentally removed from the 2005-07 continuation budget.


Post-Legislative Budget Summary, 2006-07 General FundThe University of North Carolina

47

4. North Carolina School of Science and Math Textbook Increases

The Governor recommended and the General Assembly approved an increase to the North Carolina School of Science and Math's (NCSSM) continuation budget for textbooks for 2006-07.


Total Revised Continuation Recurring Requirements $215,527

Receipts -



Nonrecurring

Requirements ($9,595,070)

Receipts -



Expansion 2006-07

1. Enrollment 1. Enrollment Growth for UNC Campuses

The Governor recommended and the General Assembly approved full funding for enrollment growth to support the student growth at UNC institutions. The 2005-06 budget funded 172,245 full time equivalent (FTE) students, an increase of 6,736 FTE, which represented an increase of 4.07% over the 2004-05 levels. UNC campuses are projected to experience additional enrollment of 7,110 FTE or 4.13% for 2006-07 bringing the total FTE to 179,355. 92,573,799

2. NC School of Science and Mathematics Enrollment Growth

The Governor recommended and the General Assembly approved $240,000 in enrollment growth for 12 new students at the NC School of Science and Mathematics. Funds will provide staff positions and student-related costs for food, medical coverage, textbooks, and furniture. 240,000


1. Enrollment Growth for UNC Campuses 13,580,670

Receipts $13,580,670



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2. Need-Based Financial Aid

The Governor recommended and the General Assembly appropriated full funding of the UNC System's need-based financial aid request to address the system-wide enrollment growth of approximately 1,730 additional needy students as well as to hold needy students harmless from any tuition and fee increases approved for 2006-07. The program currently serves 34,930 needy resident undergraduates and was fully funded at $67,248,016 from Escheats Fund receipts in 2005-06. This program arose from a late 1990's task force on student financial aid and includes components such as a ''self help'' expectation. The UNC Need-Based Financial Aid program also requires that federal Pell grants and tax credits be used first to meet students' needs. The program was partially funded through state appropriations beginning in 1999-00 and began to be funded through Escheats Fund receipts in 2002-03 with $15.2 million in continuation and $4.5 million in expansion. Escheats receipts expanded in 2003-04 with an additional recurring $10.25 million. In 2004-05 $17.5 million and in 2005-06 $19.6 million in Escheats Fund receipts were also appropriated to need-based financial aid. The Escheats Fund receipts enabled the state to fully fund the program until this year when state appropriations were again available for use.


3. Judicial College at UNC-Chapel Hill

The Governor recommended and the General Assembly appropriated recurring funding to expand the Judicial College program at UNC-Chapel Hill to provide ongoing training to judicial officials throughout the state. Currently the Judicial College provides training to approximately 400 trial and appellate judges throughout the state. This funding is to expand the program's capacity to provide training to additional judicial officials such as Magistrates, Clerks of Court, and other court support staff, administrators, and coordinators. The Judicial College received a recurring $250,000 appropriation in 2005-06.


4. Temporary Space for the Pharmacy Program at Elizabeth City State University

The Governor recommended and the General Assembly appropriated nonrecurring funds to support the lease costs for six modular units to temporarily house the Elizabeth City State University (ECSU) Pharmacy Program until a permanent facility is constructed in accordance with S.L. 2004-179, Section 1.1. Additional budgetary data are necessary for the Office of State Budget and Management to accurately manage the capital project budget and determine if adequate funds are available for the temporary facilities in accordance with S.L. 2004-179, Section 1.1 which provides an aggregate maximum funding for temporary facilities and all construction of $28 million.


5. Graduate Nurse Scholarship Program for Faculty Production

The Governor recommended and the General Assembly appropriated recurring funding to create a graduate nurse scholarship loan program to provide approximately eighty scholarship loans valued at $15,000 per year for up to two years for master's candidates in nursing education and up to three years for doctoral candidates. Scholarship loans shall be awarded by the N.C. Nursing Scholars Commission. Each recipient is required to teach 12 months in either a public or private nursing education program in North Carolina for each year they receive a scholarship loan or they must repay the loan. The N.C. State Education Assistance Authority shall adopt specific rules to administer and regulate the scholarship loan program. (2006 Session Laws, Chapter 66, Section 9.6)



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6. New Bachelor of Science in Nursing Programs

The Governor recommended and the General Assembly approved nonrecurring funding of $300,000 each to support two new Bachelor of Science in Nursing programs at Fayetteville State University (FSU) and the University of North Carolina at Pembroke (UNCP). The Governor recommended and the General Assembly approved nonrecurring funding of $250,000 for Appalachian State University (ASU) to support its new RN to BSN program. The new programs can be established more rapidly if startup funding is available for faculty hiring, equipment and other necessities.


7. Area Health Education Centers (AHEC) Expansion

Funding was provided for the Area Health Education Center (AHEC) program to address health workforce shortages in Allied Health, Dentistry, Nursing, and Pharmacy. In Allied Health, new clinical teaching sites will be added throughout the state with an emphasis on physical therapy, speech language pathology, and occupational therapy. This funding will also provide clinical training for PharmD students at Elizabeth City State University and support rural training sites for dental students. AHEC will also expand its grants to nursing programs to include innovative initiatives in clinical education, particularly in the use of technology.


8. AHEC Training of Psychiatrists and Other Mental Health Professionals

The AHEC program received recurring funding to develop innovative models for educating psychiatry residents/fellows and other mental health professionals in rural and underserved areas of the state. This will be done in order to improve placement and retention of these professionals in rural communities and to strengthen the provision of psychiatry services to these communities.


9. Translational Medicine Program - UNC-CH School of Medicine

The General Assembly approved funding to expand the Translational Medicine Program at the UNC-Chapel Hill School of Medicine that was begun in FY 05-06 with $1 million. The program is designed to identify and train junior faculty members in translational research to speed the development of new drugs, therapeutic strategies, devices and/or diagnostics, and to train physicians to collaborate with research faculty to apply medical discoveries to patient care and patient observations in research programs to improve health care.


10. Perinatal Care Network

The General Assembly approved funding for the UNC Center for Maternal and Infant Health to develop an ongoing statewide network of providers and professionals to focus on clinical and health systems in perinatal care, to create a database, and implement quality improvement initiatives with the goal of reducing infant mortality and morbidity.


11. Kannapolis Research Campus

The General Assembly approved funding for the first year of the University of North Carolina's involvement in the North Carolina Research Campus (NCRC), located at the site of the old Cannon Mills headquarters in Kannapolis. The campus will be the centerpiece of a public-private partnership between the state of North Carolina and Mr. David Murdock and his companies, Dole Foods and Castle & Cooke. The accompanying special provision directs that the Director of the Budget shall not release funds appropriated for the Kannapolis Research Campus until the Presidents of the UNC System and the NCCC System certify to


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the Director of the Budget that the UNC System and the NCCC System and the developers of the NCRC have entered into a Memorandum of Understanding concerning the participation in and use of space at the NCRC that is approved by the Presidents of the UNC System and the NCCC System. (2006 Session Laws, Chapter 66, Section 9.14)




12. NC A&T State University Matching Funds

The Governor recommended funding for NC A&T State University's match of federal funds and the General Assembly approved recurring funding of $614,847. The federally mandated matching funds were increased from 90% to 100% for agricultural research and extension programs as mandated by the Agricultural Research, Extension, and Education Reform Act of 1998. The funds are appropriated to the School of Agriculture and Environmental Science at North Carolina A&T State University.


13. Biomanufacturing Research Institute and Technology Enterprise (BRITE) at NCCU

The Governor recommended and the General Assembly approved funding for the Biomanufacturing Research Institute and Technology Enterprise (BRITE) at North Carolina Central University (NCCU). In 2005-06, the General Assembly appropriated $2 million in recurring funds to BRITE at NCCU. Funding was to be used for scientific equipment and supplies and hiring administrative and research personnel. This year's appropriation is $2.5 million in recurring funds for operating support, curriculum development and equipment.


14. Biomanufacturing Training and Education Center (BTEC) at NCSU

The Governor recommended and the General Assembly approved funding for the Biomanufacturing Training and Education Center (BTEC) at North Carolina State University (NCSU). In 2005-06, the General Assembly appropriated $2.94 million in recurring funds to BTEC at NCSU. Funding was to be used for scientific equipment and supplies and hiring administrative and research personnel. This year's appropriation is $2 million in recurring funds for operating support, curriculum development and equipment.


15. Statewide Program for Infection Control and Epidemiology (SPICE)

Funding was appropriated on an nonrecurring basis for operating costs for the Statewide Program for Infection Control and Epidemiology (SPICE) at the UNC-Chapel Hill School of Medicine. The SPICE program investigates and controls health care-associated infections in hospitals, long-term care facilities, and other medical facilities in the state. The program also provides training and consultation to these facilities to prevent and control health care-associated infections.


16. Institute of Medicine

The General Assembly approved funding for the Institute of Medicine at UNC-Chapel Hill to increase its capacity to provide relevant health data and policy recommendations to the General Assembly and other state policy makers. Funding will enable the Institute to undertake two additional studies per year and to provide a rapid response for data analysis for state decision makers.



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17. Family House at UNC Hospitals

The General Assembly approved funding to assist in construction of the Family House at UNC Hospitals. This two-story, 40 bedroom facility on Old Mason Farm Road in Chapel Hill will provide affordable housing to critically ill patients, their family members, and caregivers when visiting UNC Hospitals for evaluation or treatment. Family House has raised $4.3 million of the $6.3 million construction cost and hopes to open by mid 2007.


18. Division TEACCH (Treatment and Education of Autistic and related Communication handicapped CHildren)

Funds were appropriated on a recurring basis to Division TEACCH in the Department of Psychiatry at UNC-Chapel Hill to increase the Psychoeducational Therapists' salaries and for additional fringe benefits, for TEACCH clinic rents and operations, and for the TEACCH Diagnostic (DX) and Medical Consultant Clinic.


19. UNC-Chapel Hill Cochlear Implant Program

Funding was appropriated to the UNC Board of Governors for CASTLE (Center for the Acquisition of Spoken Language Through Listening Enrichment) which is operated by the Carolina Children's Communicative Disorders Program of the UNC Health Care System. CASTLE shall use these funds to train teachers and therapists across the state to work with deaf preschool-age children with cochlear implants and provide oral preschool classes to these children.


20. Focused Growth Campus Funds

Nonrecurring funds were appropriated to be evenly distributed among the seven focused growth institutions in the UNC system (Elizabeth City State, Fayetteville State, North Carolina A&T, NC Central, UNC-Pembroke, Western Carolina, and Winston-Salem State). Focused growth funding first occurred in 1999-01. Since then, a total of $28.4 million in recurring focused growth funds have been distributed among the seven campuses in varying amounts.


21. Special Needs Institutions

The General Assembly approved funding to three special needs institutions. UNC-Asheville and NC School of the Arts will each receive $453,334, and the NC School of Science and Math will receive $93,332.


22. North Carolina Progress Board

Nonrecurring funds were appropriated for increased research efforts of the North Carolina Progress Board. These funds are required to be matched dollar for dollar with private funds with all unmatched appropriation reverting to the General Fund at the end of the 2006-07 fiscal year. (2006 Session Laws, Chapter 66, Section 9.18)


23. NCSU Center for Universal Design

The General Assembly approved funding for the NCSU Center for Universal Design. The Center designs products and environments to be usable by all people, to the greatest extent possible, without the need for adaptation or specialized design.



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24. North Carolina Engineering Technology Center

The General Assembly approved funding to help establish the North Carolina Engineering Technology Center and support the use of two adjoining buildings in Hickory for the development of engineering technology programs.


25. Legislative Tuition Grant Increase

Funds were appropriated to increase the Legislative Tuition Grant by $100 from $1,800 to $1,900 per resident student enrolled in a North Carolina private college. This funding is based on an FTE of 31,494.


26. State Contractual Scholarship Fund Increase

Funds were appropriated to increase the average State Contractual Scholarship by $100 from $1,150 to $1,250 for resident students attending one of North Carolina's private colleges. These scholarships are for financially needy students and the $1,250 amount is an average among all awards. Funding for this average $100 increase was based on an approximate FTE of 31,161.


27. Legislative Tuition Grant and State Contractual Scholarship Fund Expansion

Funds were appropriated to expand the Legislative Tuition Grant and State Contractual Scholarship Fund programs to include part-time students that are lateral entry teachers or are nurses seeking additional certification. North Carolina's private colleges are providing approximately 19,802 course hours in teacher education and nursing.


28. NC LIVE (Libraries for Virtual Education) for Private Colleges

Funds were appropriated on a nonrecurring basis to support a portion of the costs charged to private colleges for their participation in NC LIVE (North Carolina Libraries for Virtual Education). NC LIVE is the state's electronic library that provides users access to magazine articles, national and local newspapers, business and professional journals, reference sources, and research materials.


29. UNC-NCCCS 2+2 Joint E-Learning Initiative

The Governor recommended funding for the UNC-NCCCS 2+2 Joint E-Learning Initiative and the General Assembly approved nonrecurring funding of $1 million. The funding provided will continue this 2+2 joint online initiative that began in 2005-06 with nonrecurring funds. This funding will be used to continue to build online capacity, teacher education courses, and accessibility for students in 2+2 teacher education programs. The accompanying special provision requires the UNC System and the NCCCS Office to report by September 1, 2006 to the Joint Legislative Education Oversight Committee, the Office of State Budget and Management, and the Fiscal Research Division of the General Assembly on the implementation of the UNC-NCCCS 2+2 E-Learning Initiative. (2006 Session Laws, Chapter 66, Section 9.1)



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30. UNC-Chapel Hill DESTINY Traveling Science Lab

The Governor recommended funding for the UNC-Chapel Hill DESTINY Traveling Science Lab and the General Assembly appropriated $500,000 in recurring funding. The final funding was approved to support personnel and other costs associated with the program whose grant awards have expired so that the program may maintain its current level of operations.


31. Principals' Executive Program (PEP) Initiative

The Governor recommended recurring funding for the Principals' Executive Program (PEP) and the General Assembly appropriated $250,000 in nonrecurring funding. The approved funds will be used to support an initiative focused on improving the management and leadership skills of principals in high need schools. PEP shall provide a customized professional development program and a coaching/mentor component that provides assistance at the school level.


32. Expand the Prospective Teacher Scholarship Loan Program

The Governor recommended and the General Assembly appropriated recurring funds to provide an additional 400 Prospective Teacher Scholarship Loans (PTSL). The PTSL program currently awards $2,500 annually to undergraduates working on teaching certification. Priority for the additional awards shall be given to students seeking teacher licensure in middle and high school mathematics and science as well as students participating in 2+2 teacher education programs.


33. North Carolina in the World Project

The Governor recommended funding to the Center for International Understanding for the North Carolina in the World Project and the General Assembly approved nonrecurring funding of $200,000. In 2005-06, the legislature appropriated a nonrecurring $200,000 grant to The North Carolina Center for International Understanding for the project ''North Carolina in the World: A Plan to Increase Student Knowledge and Skills about the World.'' The project will ensure that public K-12 international education efforts are focused on key countries and regions of strategic economic interest to North Carolina. The Center's 2005-06 budget was $492,668. The accompanying special provision requires the North Carolina Center for International Understanding to report to the Office of State Budget and Management and the Joint Legislative Education Oversight Committee on the activities and accomplishments of the $200,000 nonrecurring appropriation for ''North Carolina in the World'' Project no later than March 31, 2007. (2006 Session Laws, Chapter 66, Section 9.3)


34. A+ Schools

The General Assembly approved funding to the A+ Schools program affiliated with the University of North Carolina at Greensboro to expand the number of public schools participating in the program. The program assists schools in implementing school reform by integrating arts into the curriculum. The accompanying special provision directs that $100,000 appropriated to the Department of Public Instruction for the 2006-07 fiscal year shall be transferred to the Board of Governors of The University of North Carolina to provide pass-through funds for A+ schools. (2006 Session Laws, Chapter 66, Section 9.3A)



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35. Math and Science Education Network Pre-College Program Expansion

The General Assembly approved funding to the NC Math and Science Education Network to expand the number of pre-college programs. These programs help prepare under-represented students to pursue college studies in math and science.


36. Hunt Institute

Funds were appropriated to provide additional operating support for the James B. Hunt, Jr. Institute for Educational Leadership and Policy in Chapel Hill. These funds will enable the Institute to sponsor a number of new initiatives focused on improving science and math instruction, encouraging extracurricular programs for students, and expanding the Institute's reach to vested interests in educational improvement such as mayors and Chambers of Commerce.


37. North Carolina Teacher Academy Training of Literacy Coaches

The Governor recommended funding for the North Carolina Teacher Academy (NCTA) to train literacy coaches and the General Assembly appropriated $1,000,000 in nonrecurring funding. The Teacher Academy will use approved funds to design, develop, and implement both face-to-face and online training and professional development in literacy skills. This training and professional development will be provided for the literacy coaches who will be assigned to a school containing an eighth grade.


38. Expand Future Teachers of North Carolina Scholarship Loan Program

Funding was appropriated to provide an additional 50 scholarship loans each year. This program awards scholarship loans to juniors and seniors in North Carolina public and private colleges who agree to become certified to teach math, science, special education, or English as a second language in the North Carolina public schools. The scholarship loan award is $6,500 per student per year.



Receipts 13,580,670



Nonrecurring


Receipts -




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Special Provisions 1. Teacher Education Enrollment Plans

A UNC Board of Governors Task Force on Meeting Teacher Supply and Demand determined the need for campuses to develop plans for enrollment growth in the UNC system's teacher education programs. UNC-General Administration will gather plans from each constituent institution on how they will maintain their current enrollment and achieve their growth targets in these programs. Plans may include targeted use of enrollment growth funds, enhanced student support, advising, recruiting, and increases in faculty in necessary instructional areas that lead to certification, and other areas General Administration believes will achieve the intended growth results. General Administration will report these campus plans to the Office of State Budget and Management (OSBM) and the Joint Legislative Education Oversight Committee no later than December 30, 2006. No later than March 31, 2007, General Administration shall report on the progress toward meeting this priority for the 2007-08 academic year and explain the distribution of enrollment growth funds by specific initiative. (2006 Session Laws, Chapter 66, Section 9.2)

2. Study the Feasibility of Adding North Carolina Wesleyan College to the UNC System

The UNC Board of Governors shall study the feasibility of making North Carolina Wesleyan College a constituent institution of the UNC system. This study shall include a review of the following: (1) mission, (2) cost, (3) facility needs, (4) asset transfer, (5) liability analysis, (6) transition of current students/programs, (7) personnel, and (8) legislative action. The UNC Board of Governors shall use $50,000 of its 2006-07 availability to conduct the study. (2006 Session Laws, Chapter 66, Section 9.4)

3. Management Flexibility to Reorganize Budget Code 16012

Notwithstanding G.S. 143-23, for the 2006-07 fiscal year only, UNC-General Administration and the State Educational Assistance Authority shall, with the approval of the Office of State Budget and Management, reorganize budget code 16012 (UNC Board of Governors Related Educational Programs) so that the budget reflects and segregates each specific program individually. The reorganization shall result in each program within budget code 16012 being identified and budgeted separately. (2006 Session Laws, Chapter 66, Section 9.7)

4. Transfers of Appropriation

The Governor recommended and the General Assembly approved a special provision that allows special responsibility constituent institutions to transfer appropriations between budget codes. These transfers shall be considered certified even if as a result of agreements between special responsibility constituent institutions. (2006 Session Laws, Chapter 66, Section 9.8)

5. Nursing Scholars Program Modification

North Carolina General Statute 90-171.61 was revised to allow the Nursing Scholars Program to award scholarship loans up to $6,500 per year for a maximum of four years to North Carolina residents preparing to become registered nurses either through a diploma, associate degree, or baccalaureate degree program. Revisions were also made to provide scholarship loans up to $6,500 per year for a maximum of two years for residents, in a program leading to a master of science in nursing, who already hold a baccalaureate


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degree. Pro-rata scholarship loans may be awarded to recipients enrolled at least half-time in a program of study to become a registered nurse or attain a master of science in nursing degree. (2006 Session Laws, Chapter 66, Section 9.9)

6. NC School of Science and Math/High School Constituent Institution

The General Assembly approved a special provision establishing the North Carolina School of Science and Math (NCSSM) as a constituent institution of the University of North Carolina. The NCSSM had previously been an affiliated school to the University of North Carolina. (2006 Session Laws, Chapter 66, Section 9.11)

7. Expand Tuition Waiver Program for UNC Faculty and Staff

North Carolina General Statute 116-143 was revised to permit tuition waivers for UNC faculty and staff for up to three courses per year. Previously, UNC faculty and staff were limited to one course per semester. (2006 Session Laws, Chapter 66, Section 9.12)

8. Tuition and Contractual Grants for Teaching and Nursing

North Carolina General Statutes 116-19, 20, 21, and 22 were revised to permit entering into and administering contracts with private institutions that encourage the institution to continue to educate North Carolina resident licensure students. This revision allows licensure students to be eligible for the Legislative Tuition Grant, in whole if full time or pro rata if part time. A licensure student is defined as a resident with a bachelor's degree who is enrolled in a teaching or nursing licensure program. (2006 Session Laws, Chapter 66, Section 9.13)

9. North Carolina Center for the Advancement of Teaching (NCCAT)

The North Carolina General Statutes were revised to place the North Carolina Center for the Advancement of Teaching under the direction of the Board of Governors and the President of the UNC system. The chief administrative officer for NCCAT will be an executive director appointed by the UNC Board of Governors who will report to and serve at the pleasure of the President of the UNC system. (2006 Session Laws, Chapter 66, Section 9.15)

10. Principal Fellows Program

The General Assembly approved a special provision changing the scholarship loan amount for the Principal Fellows Program. The previous amount had been $20,000 per year for the two-year scholarship loan. The new loan amount is $30,000 per participant for the first year of participation. The second year amount is 60% of the beginning salary for an assistant principal plus $4,100 for tuition, fees, and books. (2006 Session Laws, Chapter 66, Section 9.16)


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11. UNC Center for School Leadership Development Consolidation and Teacher Academy Transfer

The UNC General Statutes were revised to require the Board of Governors to: (1) designate the UNC programs that will compromise the UNC Center for School Leadership Development and (2) submit to the Governor and General Assembly a single recommended budget request for continuation and expansion of those designated programs. In fiscal year 2006-07 all operating appropriations for the Principals' Executive Program, Principals' Fellows Program, NC TEACH, Model Teacher Education Consortium, and Math Science Education Network will be combined into a single appropriation for the Center for School Leadership Development provided none of the combined funds were designated for scholarships or stipends. The governing general statute for the North Carolina Teacher Academy was moved from the university statutes to the public school statutes and rewritten to transfer the organization, as a type II transfer effective January 1, 2007, to the State Board of Education for administrative purposes only. If any conflicts arise concerning the transfer the Governor is given full and final authority to remedy the conflict. The membership of the Teacher Academy Board of Trustees is re-configured with the terms of the new members set to January 1, 2007. The Teacher Academy is to report to the Joint Legislative Education Oversight Committee on all 2005-06 expenditures no later than October 1, 2006. (2006 Session Laws, Chapter 66, Section 9.17)

12. University Faculty Recruiting and Retention Fund

The General Assembly approved a Faculty Recruiting and Retention Fund in the amount of $5 million under the Office of the President of the UNC System. (2006 Session Laws, Chapter 66, Section 22.12A)

13. University of North Carolina System/EPA Compensation

The General Assembly approved a salary increase of 6% for EPA employees of The University of North Carolina, as well as EPA employees other than teachers of the North Carolina School of Science and Math (NCSSM). Teaching employees of NCSSM will receive an average annual salary increase of 8%, but at least an annual increase of $2,250. (2006 Session Laws, Chapter 66, Section 22.12)

14. University of North Carolina System/SPA Compensation

The General Assembly approved a salary increase of 5.5% for SPA employees. (2006 Session Laws, Chapter 66, Section 22.13)

15. Enrollment Growth Funding

General Statute 143-11 was amended to require that, upon consideration of the enrollment growth requests of the Board of Governors of the University of North Carolina and the State Board of Community Colleges, the Director of the Budget shall include the amounts the Director proposes to fund for such enrollment increases in the recommended continuation budget. (2006 Session Laws, Chapter 66, Section 6.10)


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Total Revisions for The University of North Carolina

2006-07 Recurring


Receipts 13,580,670



Nonrecurring


Receipts -




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Community Colleges (16800)


2006-07Certified

2006-07 Revised

PercentageChange

Requirements $991,953,715 $1,047,425,256 5.6 %

Receipts 224,657,829 215,969,343 (3.9)%

Appropriation $767,295,886 $831,455,913 8.4 %

Positions 192.000 197.000 2.6 %



Technical Adjustments - State Aid 1. Hospitalization Insurance

The Governor recommended and the General Assembly approved additional funds to fully fund hospitalization insurance for community college faculty and staff at the 2006-07 rate. The NC Community College System's 2006-07 request was inadvertently funded at the 2005-06 rate.


2. Tuition Receipts Adjustment

The Governor recommended an appropriation to replace under-realized tuition receipts and the General Assembly approved $10.75 million. These receipts are being reduced to reflect the total receipts estimated to be collected in the 2005-06 fiscal year. This reduction is in accordance with NC General Statutes Chapter 143-11, as amended by the 2005 General Assembly.

Requirements -

Receipts ($10,750,000)


Post-Legislative Budget Summary, 2006-07 General FundCommunity Colleges

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Receipts (10,750,000)



Nonrecurring

Requirements -

Receipts -

Appropriation -


Expansion 2006-07

Statewide Initiatives 1. Equipment

The Governor recommended funds to address equipment needs in the NC Community College System and the General Assembly approved $10 million nonrecurring. These additional funds will help reduce program waiting lists and meet technology training needs, thereby supporting quality education and training experiences for community college students. Of this amount, $94,973 may be used to purchase equipment in the System Office.


2. Faculty and Professional Staff Salary Increases

The Governor recommended funds for faculty and professional staff salary increases and the General Assembly approved a 6% permanent salary increase and a 2% one-time bonus. Other community college staff will receive the 5.5% salary increase provided for all state employees. The actual appropriation is located in the Compensation Reserve section of this document. These funds shall not be transferred by the State Board or used for any other budget purpose by the community colleges (2006 Session Laws, Chapter 66, Section 8.1).

3. NCCCS BioNetwork Capstone Center

The Governor recommended funds for specialized supplies at the NCCCS BioNetwork Capstone Center and the General Assembly approved $310,000 in nonrecurring funds. The Capstone Center will be housed in dedicated space at the Biomanufacturing Training and Education Center being built on NC State's Centennial Campus. Biotechnology students and workers from across the state travel to the Capstone Center for education and hands-on training with large-scale production process equipment.


4. Need-Based Financial Aid for Teaching and Nursing Students

The Governor recommended funds for need-based financial aid and the General Assembly approved $500,000 in nonrecurring funds. These funds shall be targeted to NC students


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enrolling in programs that prepare the student for a teaching or nursing career. These scholarships will be funded from lottery funds beginning in 2007-08.


5. Course Management System and Learning Objects Repository

The Governor recommended funds for an enterprise course management system and learning objects repository and the General Assembly approved $1,370,850. The repository will be used by all 58 community colleges for distance learning. These resources will support online, hybrid, and traditional instruction, and will include online learning modules for statewide use.


6. Virtual Learning Community Development Centers

The Governor recommended funds to establish Virtual Learning Community development centers and the General Assembly approved $500,000. These centers will be located at community colleges and will develop online curriculum courses, continuing education courses, and learning modules to be shared among all 58 community colleges.



7. Online Help Desk

The Governor recommended funds to support an online help desk and the General Assembly approved $625,000. The online help desk will help meet student needs with reliable and well managed support services that are deployed quickly, accurately, and satisfactorily and which will be available at any time. Online assistance can be delivered at significantly reduced costs when compared to locally supported or contracted help desk support.



8. NC REAL Enterprises

The Governor recommended funds for NC REAL Enterprises and the General Assembly approved $250,000 in nonrecurring funds. NC REAL Enterprises partners with community colleges to help rural, low wealth, and minority individuals and communities develop entrepreneurial talent and create businesses that contribute to the local economy. Of this appropriated amount, $150,000 will replace one-time funds no longer available from the Worker Training Trust Fund.


9. State Board Reserve - New Program Start-Up Funds

The Governor recommended new program start-up funds and the General Assembly appropriated nonrecurring funds to the State Board of Community Colleges Reserve to provide community colleges with start-up funding for new and innovative programs, particularly those aimed at addressing statewide needs and high-demand occupations.



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System Office 1. Regional Customized Training Directors

The Governor recommended and the General Assembly approved funds for two new regional customized training directors. One director will serve the Northeast Economic Development Region, and one director will serve the Southeast Region. These directors will serve as liaisons to business and industry sectors for providing customized training programs, including New and Expanding Industry Training (NEIT), Focused Industry Training (FIT) and Customized Industry Training (CIT).




2. Associate Director of Financial Aid

The Governor recommended and the General Assembly approved funds for an Associate Director of Financial Aid. The associate director will provide guidance, leadership, and training to assist college financial aid offices. The General Assembly encourages the State Board of Community Colleges to develop and implement a comprehensive professional development program for college financial aid staff.




3. Director of Joint High School-Community College Programs

The Governor recommended and the General Assembly approved funds to create a full-time statewide director of joint high school-community college programs. The director will serve as the NCCCS statewide coordinator for all joint high school-community college programs, including Huskins, Learn and Earn, Middle College, and dual enrollment programs. The director also will assist community colleges that are sponsoring Learn and Earn programs on their campuses and will act as a liaison between the colleges and the Learn and Earn program staff at the New Schools Project.




4. NCCCS BioNetwork Industry Liaison

The Governor recommended funds to create an NCCCS BioNetwork Industry Liaison and the General Assembly approved $129,150. This liaison will assist in the development of NEIT, FIT, and CIT training services to meet the needs of the biotechnology industry in North Carolina.





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5. Receipt Supported Position

The 2006 Session of the General Assembly authorized a receipt-supported Business and Technology Applications Analyst in the Community College System Office. This position will assist with Basic Skills needs, including federal literacy reporting requirements. The position will be funded entirely from federal Adult Education Funds.

Requirements $85,713

Receipts $85,713

Appropriation -

State Aid 1. Enrollment Growth

The Governor recommended and the General Assembly approved full funding for enrollment growth in the NC Community College System. The final 2005-06 enrollment shows a total enrollment increase of 2,277 full-time equivalent (FTE) students above the 2005-06 budgeted enrollment of 190,750. The 2006-07 budgeted enrollment is 193,027 FTE, a 1.19% increase over 2005-06. Curriculum enrollment increased by 1,153 FTE (or 0.77%), continuing education enrollment by 1,083 FTE (or 4.77%), and basic skills enrollment by 41 FTE (or 0.22%).


Receipts $1,975,801


2. Multi-campus Funding

The Governor recommended and the General Assembly approved funds to serve higher enrollments and to support the operation of 12 multi-campus sites. Community colleges offer courses at multi-campus sites to accommodate student educational needs. These sites must provide student services and offer at least one degree program entirely on-site.


3. Enrollment Growth Reserve

The Governor recommended funds for an enrollment reserve and the General Assembly approved $1.9 million in nonrecurring funds to assist colleges that experience high growth in the fall semester. The State Board of Community Colleges shall distribute funds to colleges in which the fall semester enrollment growth exceeds the previous fall's enrollment by 5%.


4. Additional Community College Financial Aid Staff

The Governor recommended funds and the General Assembly approved approximately $3.5 million for an additional financial aid position in the base allotment at each community college. These funds are restricted to use for student services positions and may not be transferred or used for any other purpose.



64

5. Additional Funding for Nursing Programs

Funds were provided to the State Board of Community Colleges to fund nursing programs at the colleges on a weighted FTE basis. Colleges may use these funds for nursing equipment and supplies, or to supplement the salaries of nursing faculty.


6. Community College Facilities, Equipment, and Allied Health Buildings

Funds were provided in the amount of $15 million for grants for community college facilities and equipment needs, and $5 million for community college allied health projects. The State Board of Community Colleges shall award grants of no more than $1 million to colleges, pursuant to the grant application and guidelines developed in consultation with the Community College System Office. These funds shall be awarded on a matching basis of one state dollar for every one non-state dollar. (2006 Session Laws, Chapter 66, Section 8.10)


7. Kannapolis Research Campus

Funds were appropriated for the Rowan-Cabarrus Community College Biotechnology Training Center and Greenhouse at the North Carolina Research Campus in Kannapolis. These funds will be used for equipment, faculty and staff, building operations, and lease expense.


8. NC Military Business Center

The General Assembly appropriated funds for the continued operation of the NC Military Business Center, a program run by Fayetteville Tech in conjunction with Craven Community College, Coastal Carolina Community College, and Wayne Community College. The center fosters statewide business development originating from the state's five military bases and to sustain MatchForce.org, the state's website for matching NC businesses with federal contract opportunities.


9. NC Information Highway Expansion

The Governor recommended and the General Assembly appropriated funds to expand the NC Information Highway (NCIH) to the eight community college main campuses without NCIH access. Expansion of the NCIH will locate one videoconferencing site in each NC community college's service area. These funds will provide eight community colleges with $15,000 for equipment to fully access the NCIH.



Receipts 2,061,514




65

Nonrecurring


Receipts -




1. Isothermal Community College Funds

Funds appropriated for composite testing at Isothermal Community College and not used for that purpose may be used to purchase equipment for the Lifelong Learning Center at Isothermal Community College (2006 Session Laws, Chapter 66, Section 8.2).

2. College Information System Project

The Community College System Office may, subject to the approval of the Office of State Budget and Management, and in consultation with the Office of Information Technology Services and the Joint Legislative Commission on Governmental Operations, use funds appropriated to create up to 20 positions or incur expenditures necessary to transfer the maintenance and administration of the College Information System from the vendor to the System Office. This provision also requires that project funds shall not revert at the end of the 2005-06 fiscal year and will remain available until expended. The Community College System Office shall report on a quarterly basis to the Joint Legislative Education Oversight Committee on the implementation of the College Information System Project (2006 Session Laws, Chapter 66, Section 8.3).

3. Carryforward for Equipment

The NC Community College System, subject to cash availability and approval of the Office of State Budget and Management, is permitted to carry forward up to $10 million of the operating funds that did not revert in 2005-06. These funds will be reallocated to the State Board of Community Colleges' equipment reserve funds and shall be distributed to the colleges consistent with G.S. 115D-31. (2006 Session Laws, Chapter 66, Section 8.4)

4. NCCCS May Use State Funds in Lieu of Federal Funds Due to Federal Mandates

Notwithstanding G.S. 143-23, the Community College System Office may use state literacy funds to fund the state administration of the GED office. Federal funds previously used to support the state administration functions shall be reallocated to the colleges. (2006 Session Laws, Chapter 66, Section 8.5).

5. Extend Deadline for Community College Capital Funds Matching Requirement

Community college capital improvement projects funded with proceeds from the 2000 Higher Education Bonds must meet the local matching requirement by July 1, 2007. This provision extends the sunset of 2000 Session Laws, Chapter 3, Section 3(d) until July 1, 2007. (2006 Session Laws, Chapter 66, Section 8.8)


66

6. Carryforward for Colleges in Economically Disadvantaged Counties

A community college may retain and carry forward its General Fund current operations credit balance remaining at the end of the fiscal year if the college's main campus is located in a designated low-wealth county, pursuant to G.S. 115D-31.3. Community colleges serving low-wealth counties (other than those in which their main campuses are located) may carry forward a pro-rata share of their current operations credit balance, based on the percentage of FTE students served in those counties. These funds may be used for maintenance of plant only after all local funds appropriated for maintenance of plant have been expended. (2006 Session Laws, Chapter 66, Section 8.9)

Total Revisions for Community Colleges

2006-07 Recurring


Receipts (8,688,486)



Nonrecurring


Receipts -




67

Education Lottery Fund (23003)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $0 $358,353,347 Receipts - - Appropriation $0 $358,353,347 Positions - -


Expansion 2006-07

1. Lottery Proceeds for Class Size

The General Assembly reprogrammed an appropriation of $127.8 million from the original 2006-07 certified budget, replacing the amount with proceeds from the North Carolina Education Lottery to fund the reduction of class sizes. This use of lottery funds is consistent with the legislation establishing and directing the use of lottery proceeds.


2. Expand More at Four to Meet Demand for Services

The General Assembly allocated funding from the North Carolina Education Lottery to add 3,200 program slots to the More at Four Program, North Carolina's statewide prekindergarten program for at-risk 4-year-olds. This allocation also increased per-slot funding by an additional $200 to allow enhanced compensation for teachers who develop skills through additional training and education. The following three staff positions were added, effective July 1, 2006: one Educational Planning and Development Consultant II, one Educational Consultant II, and an Education Processing Assistant. These positions are needed due to the program's growth and need for program monitoring and technical assistance. The 2005-06 goal of serving 15,453 at-risk four-year-olds was met, and demand for services has generated county waiting lists. A total of 18,653 children will be served.


1. Public School Building Capital Fund

This allocation provided support for the Public School Building Capital Fund in accordance with the G.S. 115C-546.2.


Post-Legislative Budget Summary, 2006-07 General FundEducation Lottery Fund

68

1. Scholarships for Needy Students

This allocation from lottery proceeds provided for 34,000 scholarships through the State Educational Assistance Authority in accordance with Article 35A of Chapter 115C of the General Statutes.



Receipts -



Nonrecurring

Requirements -

Receipts -

Appropriation -


Total Revisions for Education Lottery Fund

2006-07 Recurring


Receipts -



Nonrecurring

Requirements -

Receipts -

Appropriation -


Post-Legislative Budget Summary, 2006-07 General FundEducation Lottery Fund

69

Revised Appropriations

General Government

General Fund

71

General Assembly (11000)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $47,950,032 $47,988,316 0.1 %

Receipts 984,600 984,600 0.0 %

Appropriation $46,965,432 $47,003,716 0.1 %

Positions 298.000 298.000 0.0 %


Expansion 2006-07

General 1. Reserve for Utility and Fuel Costs

The Governor recommended $238,346 and the General Assembly approved funding in the amount of $38,284 to cover increased electric utility costs.


Total Revised Expansion Recurring Requirements -

Receipts -

Appropriation -


Nonrecurring


Receipts -



Post-Legislative Budget Summary, 2006-07 General FundGeneral Assembly

73

Total Revisions for General Assembly

2006-07 Recurring

Requirements -

Receipts -

Appropriation -


Nonrecurring


Receipts -



Post-Legislative Budget Summary, 2006-07 General FundGeneral Assembly

74

Office of the Governor (13000)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $5,663,312 $5,763,312 1.8 %

Receipts 318,784 318,784 0.0 %

Appropriation $5,344,528 $5,444,528 1.9 %

Positions 62.217 62.217 0.0 %


Expansion 2006-07

Administration 1. Operating Support

The Governor recommended and the General Assembly appropriated funding for operating support which includes travel; communication and data processing services; and other services and expenses.


Total Revised Expansion Recurring Requirements $100,000

Receipts -



Nonrecurring

Requirements -

Receipts -

Appropriation -


Post-Legislative Budget Summary, 2006-07 General FundOffice of the Governor

75

Total Revisions for Office of the Governor

2006-07 Recurring


Receipts -



Nonrecurring

Requirements -

Receipts -

Appropriation -


Post-Legislative Budget Summary, 2006-07 General FundOffice of the Governor

76

Office of State Budget and Management (13005)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $5,077,938 $5,487,876 8.1 %

Receipts 56,143 56,143 0.0 %

Appropriation $5,021,795 $5,431,733 8.2 %

Positions 56.000 59.000 5.4 %


Expansion 2006-07

Office of State Budget and Management 1. Results-Based Budgeting

The Governor recommended and the General Assembly appropriated funding to introduce results-based budgeting into the state budget process during the fiscal year. The goals are to reintroduce strategic or business planning at agencies, ensure government programs are well-defined, and facilitate the introduction of key program measures. This process requires additional resources, including a Budget Analyst position, training, hardware, software, and budget presentation redesign.




2. Administrative Office Support Position

The Governor recommended and the General Assembly appropriated funds to establish an administrative support position to be shared by the Economic Research, Management, Data Services, and Statewide Information Technology sections.




Post-Legislative Budget Summary, 2006-07 General FundOffice of State Budget and Management

77

3. Budget Analyst Position

The Governor recommended and the General Assembly appropriated funding for a Budget Analyst position for the Justice and Public Safety section. This position's primary responsibilities will include the Department of Crime Control and Public Safety and disaster management.





Receipts -



Nonrecurring


Receipts -



Total Revisions for Office of State Budget and Management

2006-07 Recurring


Receipts -



Nonrecurring


Receipts -



Post-Legislative Budget Summary, 2006-07 General FundOffice of State Budget and Management

78

North Carolina Housing Finance Agency (13010)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $4,750,945 $22,188,445 367.0 %

Receipts - - Appropriation $4,750,945 $22,188,445 367.0 %

Positions - -


Expansion 2006-07

Additional Funding for Housing Finance 1. Housing Programs

The North Carolina Housing Trust Fund provides support for affordable housing across all of North Carolina. The Governor recommended continued support of this program and the General Assembly appropriated $5.0 million in nonrecurring funds for this purpose.


2. 400 Apartment Housing Initiative

The General Assembly appropriated funding to the North Carolina Housing Trust Fund to support the creation of a 400 apartment housing initiative. These apartments will be affordable for those with incomes at the Supplemental Security Income (SSI) level.


NC Housing Foreclosure 1. Home Protection Pilot Program The General Assembly appropriated funding to continue the pilot program in 26 counties. Appropriation - Nonrecurring $1,500,000

Post-Legislative Budget Summary, 2006-07 General FundNorth Carolina Housing Finance Agency

79


Receipts -

Appropriation -


Nonrecurring


Receipts -



Total Revisions for North Carolina Housing Finance Agency

2006-07 Recurring

Requirements -

Receipts -

Appropriation -


Nonrecurring


Receipts -



Post-Legislative Budget Summary, 2006-07 General FundNorth Carolina Housing Finance Agency

80

OSBM - Reserve for Special Appropriation (13085)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $6,231,429 $7,584,682 21.7 %

Receipts 1,120,000 1,120,000 0.0 %

Appropriation $5,111,429 $6,464,682 26.5 %

Positions - -


Expansion 2006-07

Reserves and Transfers 1. Reserve for Moving and Rent Expenses

The Governor recommended funding and the General Assembly appropriated $1,353,253 for the moving and rent expenses of state agencies located in the Blount Street area. These properties are expected to be sold and all state agencies relocated during the 2006-07 fiscal year. Nonrecurring funds are recommended for moving expenses and recurring funds for rent expenses.




Receipts -



Nonrecurring


Receipts -



Post-Legislative Budget Summary, 2006-07 General FundOSBM - Reserve for Special Appropriation

81

Total Revisions for OSBM - Reserve for Special Appropriation

2006-07 Recurring


Receipts -



Nonrecurring


Receipts -



Post-Legislative Budget Summary, 2006-07 General FundOSBM - Reserve for Special Appropriation

82

Office of the Lieutenant Governor (13100)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $753,037 $841,470 11.7 %

Receipts - - Appropriation $753,037 $841,470 11.7 %

Positions 10.900 11.900 9.2 %


Expansion 2006-07

Administration 1. Increase in Operating Budget

The operational responsibilities and duties of the Lieutenant Governor's office require significant staff travel. The Governor recommended and the General Assembly appropriated additional funding to cover travel expenses.


2. Expand Research Personnel The General Assembly appropriated funding for a Senior Research Analyst position. Appropriation $85,833



Receipts -



Post-Legislative Budget Summary, 2006-07 General FundOffice of the Lieutenant Governor

83

Nonrecurring

Requirements -

Receipts -

Appropriation -


Total Revisions for Office of the Lieutenant Governor

2006-07 Recurring


Receipts -



Nonrecurring

Requirements -

Receipts -

Appropriation -


Post-Legislative Budget Summary, 2006-07 General FundOffice of the Lieutenant Governor

84

Department of Secretary of State (13200)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $9,794,292 $10,102,557 3.1 %

Receipts 424,659 424,659 0.0 %

Appropriation $9,369,633 $9,677,898 3.3 %

Positions 179.750 185.000 2.9 %



Lobbyist Section 1. Lobbyist Registration Reform

The General Assembly has created a Special Reserve for Lobbying Registration Reform in the Office of State Budget and Management. The sum of $135,802 in recurring funds appropriated in S.L. 2005-276 for Lobbyist Registration Enhancement and the sum of $24,000 in non-recurring funds appropriated in S.L. 2006-66 for Lobbyist Registration Reform shall be transferred to the Reserve.


Appropriation - Nonrecurring ($24,000)

Total Revised Continuation Recurring Requirements ($135,802)

Receipts -



Nonrecurring

Requirements ($24,000)

Receipts -



Post-Legislative Budget Summary, 2006-07 General FundDepartment of Secretary of State

85

Expansion 2006-07

Corporations Division 1. LLC Notifications and Staff Expansion

The Governor recommended and the General Assembly approved funding to expand the staff in the Corporations Division to improve the efficiency of the annual report filing process and to continue producing periodic notifications to Limited Liability Companies for annual report filing fees.




General Administration 1. Facility Planner I Position

The Governor recommended and the General Assembly approved funding to establish a Facility Planner I position and operational support to deliver department-wide programs required by statute, state policy, and business need. The department will improve compliance with all related requirements including employee safety and health, energy conservation, ADA access, Workers' Compensation, document storage, security, and disaster response.




2. Internal Auditor Position

The Governor recommended and the General Assembly approved funding to establish an Internal Auditor position and operating costs to perform risk assessments and performance audits, and to assess the department's performance regarding financial accounting, reporting, and internal controls standards. The position will be responsible for compliance with all laws, regulations, and good business practices.




Lobbyist Section 1. Lobbyist Registration Reform

The Governor recommended four new positions and the General Assembly approved funding to reallocate four positions approved in the 2005 Budget to meet the additional lobbying registration requirements that resulted from Senate Bill 612, Amend Lobbying Law, S.L. 2005-456. The Lobbyist Director ($75,611) is increased from grade level 75 to grade level 82. The three grade-level-61 positions are reallocated to an Assistant Director ($44,229) position at grade level 70, an Investigator ($46,143) position at grade level 71, and an Agency Legal Specialist III ($65,926) position at grade level 79. All four reallocated positions are funded at the midpoint salary range. The remaining five Administrative Assistant II positions at grade level 65 that were funded in the 2005 Budget are readjusted to the midpoint salary ($35,770). Additionally, $31,000 in recurring funds for rent is transferred to the Department of Administration, State Construction Division, for costs associated


86

with reallocating space in the Old Revenue Building to accommodate the Lobbyist Registration Division staff expansion. The 2005 Budget contained $389,375 in recurring funds in FY 06-07 for the Lobbyist Registration Enhancement, which included $54,000 in recurring funds for rent. The $54,000 is transferred to the Department of Administration, State Construction Division, for costs associated with reallocating space in the Old Revenue Building to accommodate the Lobbyist Registration Division staff expansion.



Receipts -



Nonrecurring


Receipts -



Total Revisions for Department of Secretary of State

2006-07 Recurring


Receipts -



Nonrecurring

Requirements $2,850

Receipts -




87

Office of the State Auditor (13300)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $13,481,203 $13,538,767 0.4 %

Receipts 2,640,285 2,640,285 0.0 %

Appropriation $10,840,918 $10,898,482 0.5 %

Positions 189.000 189.000 0.0 %


Expansion 2006-07

Field Audit Division 1. Lease for Fayetteville Branch Office

The Governor recommended and the General Assembly approved funding for the Fayetteville Branch Office to obtain new office space and move from the Office of the Clerk of Court, which is one of the agencies audited by the State Auditor. Audit standards prohibit accepting rent free office space from audited entities.


2. Agency Network Troubleshooting Software

The Governor recommended and the General Assembly approved funding for software to assist the auditor in identifying network issues accurately. The ''Network Performance Monitoring Service'' will be purchased from ITS.



Receipts -



Post-Legislative Budget Summary, 2006-07 General FundOffice of the State Auditor

88

Nonrecurring

Requirements -

Receipts -

Appropriation -


Total Revisions for Office of the State Auditor

2006-07 Recurring


Receipts -



Nonrecurring

Requirements -

Receipts -

Appropriation -


Post-Legislative Budget Summary, 2006-07 General FundOffice of the State Auditor

89

Department of State Treasurer (13410)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $37,867,279 $38,288,734 1.1 %

Receipts 29,571,436 29,711,107 0.5 %

Appropriation $8,295,843 $8,577,627 3.4 %

Positions 325.000 325.000 0.0 %


Expansion 2006-07

Investment Management Division 1. Bloomberg Portfolio Order Management System (POMS)

The Governor recommended and the General Assembly approved funding for the annual fee to Bloomberg Portfolio Order Management System (POMS) for the Long Term and Short Term Investment Funds. The POMS system was previously included in the base fee, but Bloomberg started charging for this service as the functionality and support need increased. This action will provide uninterrupted service.


Escheat Fund Administration 1. Staffing Request

The Governor recommended and the General Assembly funded three new receipt-supported positions in the Escheats Division. These positions include a Securities Analyst to maintain securities, locate owners, and sell stock on a monthly basis, and two Unclaimed Property Auditors to perform audits of unclaimed property holders to ensure their compliance with G.S. 116B.


Requirements - Nonrecurring $4,000

Receipts $135,671

Receipts - Nonrecurring $4,000

Appropriation -

Post-Legislative Budget Summary, 2006-07 General FundDepartment of State Treasurer

90

Information Services 1. Core Banking System Maintenance

The Governor approved and the General Assembly funded the annual support and maintenance required for the statewide Core Banking System.



Receipts 135,671



Nonrecurring

Requirements $4,000

Receipts 4,000

Appropriation -


Total Revisions for Department of State Treasurer

2006-07 Recurring


Receipts 135,671



Nonrecurring

Requirements $4,000

Receipts 4,000

Appropriation -


Post-Legislative Budget Summary, 2006-07 General FundDepartment of State Treasurer

91

State Treasurer - Retirement for Fire and Rescue Squad Workers and Line of Duty Death Benefits (13412)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $8,651,457 $9,165,457 5.9 %


Positions - -


Expansion 2006-07

General Fund Contribution to Fire Pension Fund 1. Increase Retirement Benefits

The General Assembly has approved funding to increase the benefit from the Firemen's and Rescue Squad Workers' Pension Fund from $163 to $165 per month.



Receipts -



Nonrecurring

Requirements -

Receipts -

Appropriation -


Post-Legislative Budget Summary, 2006-07 General FundState Treasurer - Retirement for Fire and Rescue Squad Workers

92

Total Revisions for State Treasurer - Retirement for Fire and Rescue Squad Workers and Line of Duty Death Benefits

2006-07 Recurring


Receipts -



Nonrecurring

Requirements -

Receipts -

Appropriation -


Post-Legislative Budget Summary, 2006-07 General FundState Treasurer - Retirement for Fire and Rescue Squad Workers

93

Department of Insurance (13900)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $32,620,431 $33,076,277 1.4 %

Receipts 4,509,849 4,509,849 0.0 %

Appropriation $28,110,582 $28,566,428 1.6 %

Positions 400.550 405.550 1.2 %


Expansion 2006-07

Office of the Fire Marshal 1. Receipts Supported Positions Conversion

The Governor recommended and the General Assembly approved the funding source for three positions established in 2005-06 to be converted to appropriation support and provided operational support. This action will enable the division to assign on-site inspections in a timely manner to continue reducing the backlog that has resulted in increased construction costs. This action will provide consistency within the division's budget.




Technical Services 1. Communication Specialists

The Governor recommended four additional Communication Specialist positions and the General Assembly funded two of these positions for the call center operations to assist citizens with questions and complaints on Medicare, Medicare Advantage, and Medicare Prescription Drug Plans. This action will enable the division to decrease the wait time and answer more calls while helping the citizens of North Carolina to make more informed decisions regarding Medicare health care products.




Post-Legislative Budget Summary, 2006-07 General FundDepartment of Insurance

94


Receipts -



Nonrecurring


Receipts -



Total Revisions for Department of Insurance

2006-07 Recurring


Receipts -



Nonrecurring


Receipts -



Post-Legislative Budget Summary, 2006-07 General FundDepartment of Insurance

95

Insurance - Volunteer Safety Workers' Compensation Fund (13901)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $4,500,000 $4,500,000 0.0 %


Positions - -

Post-Legislative Budget Summary, 2006-07 General FundInsurance - Volunteer Safety Workers' Compensation Fund

96

Department of Administration (14100)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $85,309,781 $88,753,958 4.0 %

Receipts 26,491,308 26,560,946 0.3 %

Appropriation $58,818,473 $62,193,012 5.7 %

Positions 702.635 725.635 3.3 %


Expansion 2006-07

State Construction 1. HUB Contractor Academies

The Governor recommended funding for the HUB Contractor Academy and the General Assembly approved $350,000 for this program. HUB academies provide opportunities for minority contractors to learn strategies for successful participation in public construction projects.




2. Space Reallocation in Old Revenue Building

The General Assembly appropriated funding to reallocate underutilized Office of State Auditor space in the Old Revenue Building to the Department of the Secretary of State in order to accommodate the Lobbying Division staff.


State Capital Police 1. Telecommunicator Position

The Governor recommended and the General Assembly approved an additional position to support the statewide alarm computer system that is monitored and managed by the State Capital Police 24 hours a day, seven days a week. Currently, sworn officers have to be utilized to monitor the system.



Post-Legislative Budget Summary, 2006-07 General FundDepartment of Administration

97

Facility Management Division 1. Additional HVAC Positions

The Governor requested and the General Assembly approved additional positions within the HVAC Section of the Division of Facility Management. Currently, the existing staff is covering 392,857 square feet of office space per employee while the industry standard is 200,000 square feet per employee. This request will bring the total per employee to 305,555 square feet.



2. Paint Shop Establishment

The Governor recommended and the General Assembly approved funding for the Department of Administration to establish a small paint shop staffed by two positions. These individuals will perform small paint jobs and help coordinate informal bids for larger projects. Currently, all painting jobs are done by contracted services.



3. Building Repairs

The Governor recommended funding to provide for small repairs to aging and deteriorating state buildings and the General Assembly provided nonrecurring funds for this purpose. Areas covered include painting, plumbing, electrical, carpentry, AC systems, and general building repair.


4. Increase for Utility and Fuel Expenses

Due to the rising cost of utilities and fuel, the Governor recommended that the Department of Administration receive additional funding to cover the increased cost of electrical, natural gas, propane, and gasoline expenses. The General Assembly appropriated $263,492 for this purpose.


State Property Office 1. State Property Surplus Property Disposal System

In Session Law 2003-284, the department was instructed to develop a State-Owned Real Property Disposal System. The Governor recommended and the General Assembly appropriated funding for the establishment of this system.


NC Council for Women/Domestic Violence Commission 1. Domestic Violence Staffing

The Governor recommended and the General Assembly approved five full-time support staff for the regional offices. This will assure that all regional directors will have full-time support staff so that they can continue to provide services to the counties they serve.




98

2. Domestic Violence Center Fund

The Governor recommended and the General Assembly appropriated additional funding for grants for domestic violence programs. Grants will be awarded from the Domestic Violence Center Fund pursuant to G.S. 50.9.


3. Rape Crisis/ Sexual Assault The General Assembly appropriated funding for rape crisis and sexual assault services. Appropriation - Nonrecurring $100,000

4. Council for Women Staffing

The General Assembly approved the creation of a Community Development Specialist position for the Council for Women.




Division of Veterans Affairs 1. Increase Funding for Veterans Scholarship Program

The Governor recommended additional funding to support the Veterans Scholarship program. The General Assembly appropriated $373,825 for this program. Over the last two years, the program has experienced a 20% increase in enrollment and rising tuition and educational costs.


2. Request Three Additional Positions for Division of Veteran Affairs

As the veteran population continues to grow, there has been a greater demand placed on the Veterans Affairs field offices in the state. The Governor recommended three additional positions to meet this need and the General Assembly appropriated $125,846 for these positions. One position will be placed in Durham and one in Asheville. The third position is a Training Officer, who will travel the state training county service officers on electronic claims filing, accessing Veterans Affairs files, and researching cases from the U.S. Court of Appeals for Veterans Claims.




Commission on Indian Affairs 1. Economic Development Initiative

The Governor recommended that the Commission of Indian Affairs hire additional staff to continue work on the NC Indian Economic Development Initiative. The General Assembly approved funding for two positions.





99

Office of State Personnel 1. International Employment Specialist

The Governor recommended and the General Assembly approved a full-time International Employment Specialist. The position will ensure compliance with federal laws and regulations regarding the employment of foreign nationals.



2. EEO Diversity and Special Emphasis Project Management

The Governor recommended and the General Assembly appropriated funding to support the mission to provide leadership and support to agencies and universities in diversity efforts and independently to investigate documented complaints.



3. Mediation Training Staff

The Governor recommended and the General Assembly appropriated funding to establish an additional position for the mediation program. Mediation has been shown to be a cost effective way of dealing with employee grievances.



4. Receipt Supported Position - NC Flex Program

The NC Flex program has experienced significant growth over the past few years. The program is now expanding to community colleges and possibly the school system. The Governor recommended and the General Assembly approved additional staff to provide services necessary for the program's administration and implementation.


Receipts $69,638

Appropriation -


Youth Involvement Office 1. Increase Internship Slots

The General Assembly appropriated funds to support an additional 25 summer internship positions.


Energy Office 1. Emergency Management Plan

The General Assembly appropriated funding to update the Emergency Management Plan. This funding is to be transferred to Budget Code 34100 from Fund Code 3466.



100


Receipts 69,638



Nonrecurring


Receipts -



Total Revisions for Department of Administration

2006-07 Recurring


Receipts 69,638



Nonrecurring


Receipts -




101

Office of the State Controller (14160)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $10,251,496 $10,251,496 0.0 %

Receipts 206,985 206,985 0.0 %

Appropriation $10,044,511 $10,044,511 0.0 %

Positions 85.750 85.750 0.0 %

Post-Legislative Budget Summary, 2006-07 General FundOffice of the State Controller

102

Department of Revenue (14700)


2006-07Certified

2006-07 Revised

PercentageChange

Requirements $100,500,544 $103,021,362 2.5 %

Receipts 19,827,294 21,068,330 6.3 %

Appropriation $80,673,250 $81,953,032 1.6 %

Positions 1,456.500 1,504.500 3.3 %



Taxpayer Call Center 1. Operating Expense Transfer

The General Assembly approved the transfer of 15 positions from General Fund to receipt-support with revenue from the 20% Collection Assistance Fee.



Total Revised Continuation Recurring Requirements ($494,402)

Receipts -



Nonrecurring

Requirements -

Receipts -

Appropriation -


Post-Legislative Budget Summary, 2006-07 General FundDepartment of Revenue

103

Expansion 2006-07

Information Technology 1. IT Staffing

The Governor recommended funding for additional IT staff positions. The General Assembly approved $521,059 for six new positions to provide systems applications development, mainframe applications development, PC/desktop hardware/software support, business analysis, and computer operations.



2. Security for Taxpayer Operating System

The Governor recommended and the General Assembly appropriated funding to address the security issues of the taxpayer operating system form raised in the 2004 Statewide Security Assessment.


Personal Taxes 1. Staffing for Tax Hearings

The Governor recommended funding for a position to assist with the increase in administrative tax hearings resulting from increased taxpayer activities brought about by Project Collect Tax and Project Tax Compliance. The General Assembly appropriated $64,065 for this purpose.




Documents and Payments 1. Additional Support for Division

The Governor recommended adding positions to process the increase in payments resulting from increased collection activities brought about by Project Collect Tax and Project Compliance. The General Assembly approved 5 new positions for this purpose.



William S. Lee Tax Credit Program 1. Additional Support for William S. Lee Tax Credit Program

The application fee that helps support the William S. Lee program is not sufficient to fund all the needed personnel. The Governor recommended appropriations to assist in funding the program. The General Assembly appropriated $171,390 to augment the lack of receipts.




104

Taxpayer Call Center 1. Taxpayer Assistance and Collection Center Staffing

The Governor recommended and the General Assembly approved the conversion of 30 temporary positions to permanent positions and the addition of 17 permanent positions. The total cost of the conversion and new positions is $1,641,036. Part of the cost will be covered by an existing $400,000 budgeted in temporary wages, which will be moved from the temporary line item to salaries. The remaining $1,241,036 will come from receipts from the 20% fee charged in relation to Project Collect.



Receipts $1,139,201


Appropriation -


Unauthorized Substance Tax 1. Additional Tax Enforcement Agent and Lease Space

The Governor recommended and the General Assembly approved one new law enforcement tax agent for the Unauthorized Substance (USUB) Tax Division in the Department of Revenue. In addition, the USUB Tax Division is being relocated to an office outside the Revenue Building. The Governor recommended and the General Assembly appropriated funding to cover the cost of rent.





Receipts 1,139,201



Nonrecurring


Receipts 101,835




105

Total Revisions for Department of Revenue

2006-07 Recurring


Receipts 1,139,201



Nonrecurring


Receipts 101,835




106

Department of Cultural Resources (14800)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $71,274,299 $76,695,315 7.6 %

Receipts 8,357,152 8,357,152 0.0 %

Appropriation $62,917,147 $68,338,163 8.6 %

Positions 735.285 766.285 4.2 %


Expansion 2006-07

Office of the Secretary 1. Facility Construction Engineer Position

The Governor recommended and the General Assembly approved funding to establish a capital projects facility construction engineer to design facilities, perform design reviews, monitor construction, and inspect and manage renovations and new construction projects throughout the state.



2. Attorney III Position

The Governor recommended and the General Assembly approved an additional attorney for the department. The attorney will be located in the Department of Justice. The focus of this position will be administrative law matters involving personnel, procurement and contracting, organizational development, and historical document and artifact recovery.



Administrative Services 1. Accountant Position

The Governor recommended and the General Assembly appropriated funding for an Accountant I position to help the department meet legally mandated and grant specific accounting and reporting requirements in a timely manner.



Post-Legislative Budget Summary, 2006-07 General FundDepartment of Cultural Resources

107

Archives and History Administration 1. Cultural Sharing and Caring Program

The Governor recommended funding for the creation of the Cultural Sharing and Caring Program and the General Assembly appropriated $750,000 for this purpose. This program will be designed to enhance the teaching and learning of history, arts, and culture in North Carolina by providing for the creation of several education initiatives and expansion of established programs.


State Historic Sites 1. Fire and Burglary Protection

The Governor recommended funds to provide for the installation and maintenance of fire and/or intrusion alarm systems throughout the state and enhance security at Fort Fisher and the North Carolina Transportation Museum and the General Assembly appropriated $288,957 for this purpose.



Historic Preservation 1. Eastern Office-Humber House

The Governor recommended and the General Assembly appropriated funding to support the operations of the Eastern Office located in the Humber House in Greenville.


Office of State Archaeology 1. Queen Anne's Revenge Archaeology Project

The Governor recommended funding to sustain archaeological and historical research on the shipwreck believed to be Blackbeard's Queen Anne's Revenge, and the General Assembly appropriated nonrecurring funds for this project. The need to recover and preserve materials from the Queen Anne's Revenge is most important because of frequent hurricanes and ocean currents that erode the site and displace and destroy artifacts and ship remains.


Museum of Art 1. Monet and Egyptian Treasures Exhibits

The Governor recommended and the General Assembly approved funding for payment of the required venue fee for the Egyptian Art exhibit and costs associated with bringing the Monet exhibition to the Museum.



108

North Carolina Arts Council 1. Grassroots Arts Council

The General Assembly appropriated funding for grants in FY 2006-07 that will be awarded through the formal application process.


2. Basic Grants Program

The General Assembly appropriated funding for grants in FY 2006-07 that will be awarded through the formal application process.


North Carolina Symphony 1. Symphony Education Program

The Governor recommended funding to support the North Carolina Symphony's education programs throughout the state and the General Assembly appropriated non-recurring funds for this purpose. These funds will allow the symphony musicians and conductors to reach more children and adults by creating partnerships with the North Carolina Community College System, develop master classes, increase access to teachers, and provide hands-on opportunities for children.


Department-wide 1. Conversion of Temporary Positions to Permanent Positions

The Governor recommended and the General Assembly appropriated funding to convert 20 temporary positions to permanent positions. The permanent positions will provide the department with a more stable work force for the History Museum, Queen Anne's Revenge, Tryon Palace, Maritime Museum, and historic sites.



2. Reserve for Utility and Fuel Costs

The Governor recommended establishing a reserve for projected increased costs for electricity, natural gas, and propane for the state historic sites and other facilities located throughout the state and the General Assembly appropriated $19,964 for this purpose.


Statewide Programs and Grants 1. Digital Preservation Program (State Library)

The Governor recommended and the General Assembly approved funding to assist state agencies in understanding and participating in digital preservation efforts to collect, manage, and preserve digital publications and other records of government for long-term public access.




109

2. Aid to Counties

The General Assembly appropriated funding to support grants to public libraries in accordance with the formula for State-Aid to Libraries.



Receipts -



Nonrecurring


Receipts -



Total Revisions for Department of Cultural Resources

2006-07 Recurring


Receipts -



Nonrecurring


Receipts -




110

Roanoke Island Commission (14802)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $1,783,374 $1,783,374 0.0 %


Positions - -

Post-Legislative Budget Summary, 2006-07 General FundRoanoke Island Commission

111

State Board of Elections (18025)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $8,597,378 $9,474,404 10.2 %

Receipts 3,528,071 3,618,477 2.6 %

Appropriation $5,069,307 $5,855,927 15.5 %

Positions 21.000 52.000 147.6 %


Expansion 2006-07

Campaign Reporting 1. Additional Staffing

The General Assembly approved funding for eight new positions with operational support and increased the grade level of the Deputy Director ($75,611) from grade level 75 to grade level 82. The new positions include four Field Auditors ($54,956 each), two Campaign Finance Training Specialists ($44,229 each), and two Compliance Specialists ($54,956 each). A grade level 65 position was reallocated to a Compliance Specialist ($54,956). The General Assembly approved funding for three time-limited Audit Specialists ($48,139 each) to address the auditing backlog of campaign finance reports.




Computerized Voter Registration 1. Contract Position to Permanent Status

The Governor recommended and the General Assembly approved the authorization of the use of receipts from Maintenance of Effort funds to convert a contracted IT Project Manager position to permanent status.


Receipts $90,406

Appropriation -


Post-Legislative Budget Summary, 2006-07 General FundState Board of Elections

112

2. Time-Limited Positions (TLP) Conversion

The Governor recommended and the General Assembly approved the conversion of 19 time-limited positions to permanent positions by authorizing the use of receipts from Maintenance of Effort funds. This action will enable the State Board of Elections to continue to meet the mandates of S.L. 2005-323.



Receipts 90,406



Nonrecurring


Receipts -



Total Revisions for State Board of Elections

2006-07 Recurring


Receipts 90,406



Nonrecurring


Receipts -



Post-Legislative Budget Summary, 2006-07 General FundState Board of Elections

113

Office of Administrative Hearings (18210)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $3,089,726 $3,371,093 9.1 %

Receipts 120,014 120,014 0.0 %

Appropriation $2,969,712 $3,251,079 9.5 %

Positions 43.000 45.000 4.7 %


Expansion 2006-07

Administration and Operations 1. Operational Support and Reduction of Unrealized Receipts

The budgeted receipts for the sale of the NC Register have not been realized because it is available on the Internet at no charge. The Governor recommended additional funds for employee educational expenses to obtain certification training for Civil Rights Investigators and to supplement CLE training for attorneys. The General Assembly appropriated $61,367 for these purposes.



2. Administrative Law Judge Positions

The Governor recommended establishing two Administrative Law Judges and funding additional space for hearings to assist in handling increased case filings. The General Assembly appropriated $220,000 for these purposes.





Receipts -



Post-Legislative Budget Summary, 2006-07 General FundOffice of Administrative Hearings

114

Nonrecurring


Receipts -



Total Revisions for Office of Administrative Hearings

2006-07 Recurring


Receipts -



Nonrecurring


Receipts -



Post-Legislative Budget Summary, 2006-07 General FundOffice of Administrative Hearings

115


Health and Human Services

General Fund

117

Department of Health and Human Services (144xx)


2006-07Certified

2006-07 Revised

PercentageChange

Requirements $14,631,353,225 $14,688,926,220 0.4 %

Receipts 10,366,413,097 10,456,773,588 0.9 %

Appropriation $4,264,940,128 $4,232,152,632 (0.8)%

Positions 18,113.490 18,386.490 1.5 %

Total Revised Continuation Recurring


Receipts 39,962,846



Nonrecurring

Requirements -

Receipts 3,000,000



Post-Legislative Budget Summary, 2006-07 General FundDepartment of Health and Human Services

119

Total Revised Expansion Recurring


Receipts 73,424,203



Nonrecurring


Receipts (26,026,558)



Total Revisions for Department of Health and Human Services

2006-07 Recurring





Nonrecurring


Receipts (23,026,558)



Post-Legislative Budget Summary, 2006-07 General FundDepartment of Health and Human Services

120

Division of Central Management and Support (14410)


2006-07Certified

2006-07 Revised

PercentageChange

Requirements $233,202,541 $183,043,809 (21.5)%

Receipts 114,321,622 119,326,126 4.4 %

Appropriation $118,880,919 $63,717,683 (46.4)%

Positions 672.250 675.250 0.4 %



Technical Adjustment 1. Reprogram More at Four to Lottery Proceeds

The Governor recommended that More at Four be reprogrammed to lottery proceeds, consistent with legislation establishing and directing the use of proceeds from the NC Education Lottery. The General Assembly transferred this program to the Department of Public Instruction.


Total Revised Continuation Recurring Requirements ($66,646,653)

Receipts -



Nonrecurring

Requirements -

Receipts -

Appropriation -


Post-Legislative Budget Summary, 2006-07 General FundDivision of Central Management and Support

121

Expansion 2006-07

Central Administration 1. Funding for the Office of Medicaid Management Information Services (OMMIS)

The Governor recommended and the General Assembly approved using $5,004,504 from the Medicaid Trust Fund to match federal funding for OMMIS, which provides central management support for the design, development, and implementation of a new Medicaid Management Information System (MMIS). System development complies with the federal mandate from the Centers for Medicare and Medicaid Services (CMS) to rebid and update the Medicaid claims payment system. The state receives federal funding for 90% of the costs of MMIS design, development, and implementation and 75% for the operational costs.


Receipts $5,004,504

Appropriation -

2. Public Awareness of Safe Surrender of Infants

The Governor requested funding for radio ads, billboards, print ad campaigns, posters, and brochures to inform the public of the Safe Surrender Act (S.L. 2001-291). The General Assembly appropriated $98,000 in nonrecurring funds for this purpose.



The Governor recommended nonrecurring funding be provided to address increasing utility and fuel costs and the General Assembly appropriated $585,417 for this purpose.


4. Psychiatrist Access

The General Assembly appropriated funding to improve psychiatrist access for public consumers.



5. Strategic LME Team

The General Assembly established three new positions to create a Local Management Entity (LME) Strategic Assistance Team, which will assist LMEs in developing, implementing, and maintaining their statutory responsibilities.



6. Community Health Center Grants

The General Assembly provided additional funding for grants-in-aid awarded through the Community Health Center Grant Program.


7. Rural Hospital Operations and Maintenance

The General Assembly appropriated funding for small rural hospitals in need of assistance with operations and infrastructure maintenance.



122


Receipts 5,004,504



Nonrecurring


Receipts -



Total Revisions for Division of Central Management and Support

2006-07 Recurring


Receipts 5,004,504



Nonrecurring


Receipts -




123

Division of Aging and Adult Services (14411)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $77,341,817 $82,877,703 7.2 %

Receipts 47,846,678 47,846,678 0.0 %

Appropriation $29,495,139 $35,031,025 18.8 %

Positions 58.000 58.000 0.0 %


Expansion 2006-07

1. Home and Community Care Block Grant

The Governor's recommendation to increase the Home and Community Care Block Grant funding was approved. The funds will be allocated to the Area Agencies on Aging to reduce the waiting list for services.


2. Long-Term Care Quality Improvement

The General Assembly supported improvements in long-term care by authorizing funds for long-term care ombudsman positions and to support the quality improvement collaboration with the long-term care industry.


3. Adult Day Care Rates

The General Assembly authorized an increase in the daily rates for adult day care and adult day health programs. Funding will be split between the State Adult Day Care Fund and the Home and Community Care Block Grant.



Receipts -



Post-Legislative Budget Summary, 2006-07 General FundDivision of Aging and Adult Services

124

Nonrecurring

Requirements -

Receipts -

Appropriation -


Total Revisions for Division of Aging and Adult Services

2006-07 Recurring


Receipts -



Nonrecurring

Requirements -

Receipts -

Appropriation -


Post-Legislative Budget Summary, 2006-07 General FundDivision of Aging and Adult Services

125

Division of Child Development (14420)


2006-07Certified

2006-07 Revised

PercentageChange

Requirements $558,855,024 $587,916,932 5.2 %

Receipts 291,498,225 291,498,225 0.0 %

Appropriation $267,356,799 $296,418,707 10.9 %

Positions 273.750 283.750 3.7 %


Expansion 2006-07

1. Child Care Subsidy

The Governor recommended $20 million in state appropriation to reduce the child care waiting list and the General Assembly approved $14.1 million to reduce the waiting list and implement provider rate adjustments, by region, as defined in the 2005 Child Care Market Rate Study (2006 Session Laws, Chapter 66, Section 10.34). Additional funding from the Temporary Assistance for Needy Families (TANF) Block Grant for subsidy services will, in total, remove 3,096 children from the waiting list.


2. Improve Regulatory Oversight

The Governor recommended and the General Assembly approved funds for ten new positions, effective October 1, 2006, in the Division of Child Development's Licensing Unit. The additional staff will reduce caseloads and increase the number of unannounced visits from 500 to 5,000 annually.



Receipts -

Receipts - Nonrecurring -



Post-Legislative Budget Summary, 2006-07 General FundDivision of Child Development

126

3. Smart Start

The Governor recommended $10 million and the General Assembly approved $13.5 million for local Smart Start initiatives, including subsidized child care. Operating support in the amount of $400,000 shall be allocated to the North Carolina Partnership for Children, Inc. (2006 Session Laws, Chapter 66, Section 10.35)


4. T.E.A.C.H.

The General Assembly approved nonrecurring funding for the North Carolina T.E.A.C.H. Early Childhood Project.



Receipts -



Nonrecurring


Receipts -



Total Revisions for Division of Child Development

2006-07 Recurring


Receipts -



Nonrecurring


Receipts -



Post-Legislative Budget Summary, 2006-07 General FundDivision of Child Development

127

Office of Education Services (14424)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $36,541,659 $37,538,442 2.7 %

Receipts 2,259,764 2,259,764 0.0 %

Appropriation $34,281,895 $35,278,678 2.9 %

Positions 628.875 651.875 3.7 %


Expansion 2006-07

1. Early Intervention Teachers for the Deaf and Hard of Hearing

The Governor recommended and the General Assembly appropriated funding for eight teachers (effective October 1, 2006) to increase the intensity of direct early intervention services provided to children who are deaf and hard of hearing and to meet the needs of those newly referred.


Receipts -



2. Early Intervention Teachers for the Blind and Visually Impaired

The Governor recommended and the General Assembly approved five teaching positions and one Orientation and Mobility Specialist (all effective October 1, 2006) to meet direct service needs of visually impaired children statewide who are served through the Governor Morehead Early Intervention Program and Preschool.



Post-Legislative Budget Summary, 2006-07 General FundOffice of Education Services

128

3. Language Interpreters

The Governor recommended and the General Assembly appropriated funding for four interpreters (effective October 1, 2006): one at North Carolina School for the Deaf in Morganton, one at Governor Morehead School for the Blind in Raleigh, and two at Eastern North Carolina School for the Deaf in Wilson.


Receipts -



4. Dormitory Supervisors at North Carolina School for the Deaf in Morganton

The Governor recommended and the General Assembly appropriated funding for two Resident Life Attendants (effective October 1, 2006) at the North Carolina School for the Deaf in Morganton to provide adequate supervision and increased safety for children living in the school's dormitory, Main Hall.



5. Housekeeper at North Carolina School for the Deaf in Morganton

The Governor recommended and the General Assembly approved the addition of a Housekeeper position (effective October 1, 2006) to handle routine services at the North Carolina School for the Deaf in Morganton.



6. Behavior Specialists for Eastern North Carolina School for the Deaf

The Governor recommended and the General Assembly established two Behavior Programming Technicians at Eastern North Carolina School for the Deaf (effective October 1, 2006). The school has an increasing number of students with multiple disabilities, especially behavioral and emotional disorders, including autism. Increasing from three to five behavior programming technicians will allow for one-on-one supervision when necessary, reduce instructional disruptions, and increase safety in instructional and residential settings.



7. Telemedicine for Children in Residential Schools

The Governor recommended and the General Assembly appropriated funding to implement telemedicine programs at the Western North Carolina School for the Deaf in Morganton and at Governor Morehead School for the Blind in Raleigh. Telemedicine, which is successfully operational at Eastern North Carolina School for the Deaf, brings daily medical care directly to the students in their school setting, using existing student health center nurses and a link to the Department of Pediatrics and the Telemedicine Center at Brody School of Medicine at East Carolina University. Telemedicine improves pediatric health care and improves student attendance.




129

8. Beginnings for Parents of Children who are Deaf or Hard of Hearing

The General Assembly appropriated funding for family support services for families with children who are deaf or hard of hearing.



Receipts -



Nonrecurring


Receipts -



Total Revisions for Office of Education Services

2006-07 Recurring


Receipts -



Nonrecurring


Receipts -




130

Division of Public Health (14430)


2006-07Certified

2006-07 Revised

PercentageChange

Requirements $618,055,603 $641,952,815 3.9 %

Receipts 467,241,107 473,003,077 1.2 %

Appropriation $150,814,496 $168,949,738 12.0 %

Positions 1,832.555 1,976.555 7.9 %



1. Vision Care Program The General Assembly enacted a reduction in funding for the Vision Care Program. Appropriation ($1,500,000)


Receipts -



Nonrecurring

Requirements -

Receipts -

Appropriation -


Post-Legislative Budget Summary, 2006-07 General FundDivision of Public Health

131

Expansion 2006-07

1. Antiviral Purchase for Pandemic Flu

The Governor recommended and the General Assembly approved funding the state match for federal funds (25% federal / 75% state) to purchase and store flu antiviral medication for the state's first responders and front-line healthcare workers. Approximately 27,300 doses can be purchased.




2. School Nurse Funding

The Governor recommended and the General Assembly approved funding to permanently fund 65 time-limited school nurse positions previously funded by onetime federal block grants.


Receipts -


3. Early Intervention

The Governor recommended and the General Assembly approved funds to expand the children's Early Intervention Program and eliminate the waiting list. The number of children referred to the program has increased 270%. The increase is due in part to the new federal Child Abuse and Treatment Act, which requires referral to the Early Intervention Program for all children for whom abuse or neglect has been substantiated. No federal funds were provided to support this mandate. Also authorizes the use of receipts to support 56 full-time equivalent positions. Positions are effective October 1, 2006.



4. Universal Vaccine Program

The Governor recommended and the General Assembly approved funds to provide two additional vaccines (influenza and pertussis booster) as recommended by the Centers for Disease Control.


Receipts $5,228,637



132

5. Health Disparities Initiative

The Governor recommended and the General Assembly approved funds for the Community-Focused Eliminating Health Disparities Initiative (CFEHDI). The program will provide grants-in-aid to faith-based and community-based organizations to close the gap in the health status of African-Americans, Hispanics/Latinos, and American Indians. The focus will be on reducing infant mortality, HIV/AIDS and other sexually transmitted infections, cancer, diabetes, homicides, and motor-vehicle deaths. The requested position will be effective October 1, 2006.



6. Dental Preventive Services

The Governor recommended and the General Assembly approved funds to reestablish the dental program in the schools for children at risk for tooth decay. Funds will be used to reinstitute the fluoride mouth rinse program (FMR) in schools with a high proportion of low income children. Funding is also provided for a Program Manager I position effective October 1, 2006.



7. Private Well Water Safety Program

The Governor recommended and the General Assembly approved funding for equipment and supplies to test private new wells subject to increased enforcement of well construction standards. Three new positions are requested to be supported through fee receipts. Positions are effective October 1, 2006.


Receipts - Nonrecurring -


8. Women's Health Services

The General Assembly approved funding for family planning services to uninsured women who are not eligible for Medicaid.


9. Healthy Start Foundation The General Assembly approved a grant-in-aid to the Healthy Start Foundation. Appropriation - Nonrecurring $300,000

10. Prevention of Preterm Births

The General Assembly approved funds to provide education to women on the benefits of progesterone for those who have had preterm births and to purchase medication for eligible minority and low-income women.



133

11. Child Maltreatment

The General Assembly approved funding for one position and support costs to coordinate the implementation of NC Institute of Medicine recommendations for initiatives to prevent the occurrence of child maltreatment.



12. Health Information System (HIS)

The Governor recommended and the General Assembly approved funds for the Health Information System. The funds ($9,385,795) are appropriated from budget code 24430.


Receipts 5,228,637



Nonrecurring


Receipts 533,333



Total Revisions for Division of Public Health

2006-07 Recurring


Receipts 5,228,637



Nonrecurring


Receipts 533,333




134

Division of Social Services (14440)


2006-07Certified

2006-07 Revised

PercentageChange

Requirements $1,358,662,839 $1,396,566,909 2.8 %

Receipts 1,167,983,554 1,190,205,060 1.9 %

Appropriation $190,679,285 $206,361,849 8.2 %

Positions 766.000 766.000 0.0 %


Expansion 2006-07

1. Federal Budget Impact on Foster Care Services

The Governor recommended and the General Assembly appropriated funding for the state's share of anticipated increased costs for foster care due to the federal Budget Reconciliation Act. The law requires that people who care for their relatives' children must now become licensed and thereby eligible for foster care maintenance payments. Approximately 2,300 children in foster care are currently placed with unlicensed relatives.


Receipts $3,831,505


2. Foster Care and Adoption Assistance Payments

The Governor recommended and the General Assembly appropriated funding for foster care and adoption assistance payments.




Post-Legislative Budget Summary, 2006-07 General FundDivision of Social Services

135

3. Child Support Enforcement Call Center

The Governor recommended funding to replace the Voice Response Unit and upgrade the telephone system for the Child Support Enforcement Call Center in Martin County. The General Assembly appropriated $2.0 million for this upgrade.

Requirements - Nonrecurring $2,640,109



4. Paternity Testing for Child Support Enforcement

The Governor recommended and the General Assembly appropriated funding to maintain the existing funding level for paternity testing expenses. The new federal Budget Reconciliation Act reduces the federal financial participation (FFP) from 90% to 66% for paternity testing in child support cases.

Requirements -

Receipts ($151,500)


5. Work First Cash Assistance

The General Assembly reduced funding for Work First Cash Assistance payments for Fiscal Year 2006-07.


6. Child and Family Teams

The Governor recommended and the General Assembly provided funding to facilitate Child and Family Team meetings in county DSS that will support the statewide implementation of the Multiple Response System.


7. Food Banks

The General Assembly appropriated funds for the regional network of food banks in North Carolina. The funds are to be equally distributed across the network.


8. State/County Special Assistance Rate Adjustment

The General Assembly appropriated funding for an increase in the State/County Special Assistance monthly rate effective January 1, 2007.



Receipts 21,581,397




136

Nonrecurring


Receipts 640,109



Total Revisions for Division of Social Services

2006-07 Recurring


Receipts 21,581,397



Nonrecurring


Receipts 640,109




137

Division of Medical Assistance (14445)


2006-07Certified

2006-07 Revised

PercentageChange

Requirements $10,312,444,582 $10,262,267,093 (0.5)%

Receipts 7,561,235,423 7,618,607,934 0.8 %

Appropriation $2,751,209,159 $2,643,659,159 (3.9)%

Positions 383.250 383.250 0.0 %



1. Ticket -To-Work Date Change

The General Assembly approved a reduction in funding for the Ticket-To-Work Program because the implementation date has been changed to July 1, 2007. (2006 Session Laws, Chapter 66, Section 10.9)


Receipts ($343,747)


2. Medicaid Reserve Fund

The General Assembly approved a transfer of funds from the Medicaid Reserve Fund to support current services and reduce state appropriation on a onetime basis. (2006 Session Laws, Chapter 66, Section 10.7)

Requirements - Nonrecurring -

Receipts - Nonrecurring $3,000,000


Post-Legislative Budget Summary, 2006-07 General FundDivision of Medical Assistance

138

Technical Adjustment 1. Revised Medicaid Forecast

The Governor recommended and the General Assembly approved a reduction in state appropriation for the Medicaid program, based on an increase in the federal matching rate, an increase in anticipated state Medicaid savings resulting from the Medicare drug plan, and a revised forecast for FY 2006-07.





Receipts 39,962,846



Nonrecurring

Requirements -

Receipts 3,000,000



Expansion 2006-07

1. Inflationary Increases

The General Assembly approved funding for inflationary increases for Medicaid providers effective January 1, 2007. (2006 Session Laws, Chapter 66, Section 10.11)





139

2. CAP-MR/DD Slots

The General Assembly provided full funding for additional slots in the Community Alternatives Program for the Mentally Retarded/Developmentally Disabled.


Receipts $6,874,918


3. Reimbursement Rates for Skilled Nursing Facilities

The General Assembly approved funding to make adjustments to case-mix reimbursement rates for skilled nursing facilities effective January 1, 2007. (2006 Session Laws, Chapter 66, Section 10.11.(c))


Receipts $3,473,474


4. In-Home Services Rate Adjustment

The General Assembly approved funding for rate increases for home health and personal care service providers effective January 1, 2007.


Receipts $3,473,475


5. Health Care Access Study

Funds were appropriated to support the development of a plan to expand health care access for uninsured North Carolinians through the use of public/private partnerships, federal flexibility and resources, and promotion of charity care by health care providers. (2006 Session Laws, Chapter 66, Section 10.12)




6. Provider Rate Study

The General Assembly provided funding to contract with independent consultants and financial experts to assist the division in developing a proposal for an equitable standard to provide inflationary increases and other cost related increases to service providers in the Medicaid program. (2006 Session Laws, Chapter 66, Section 10.11)





140

7. Onetime Cap on County Medicaid Share

The General Assembly approved nonrecurring funds for onetime assistance so that the portion of Medicaid service costs for FY 2006-07 for all 100 counties does not exceed the amount paid in FY 2005-06. (2006 Session Laws, Chapter 66, Section 10.9E)

Requirements - Nonrecurring -

Receipts - Nonrecurring ($27,400,000)



Receipts 41,609,665



Nonrecurring


Receipts (27,200,000)



Total Revisions for Division of Medical Assistance

2006-07 Recurring


Receipts 81,572,511



Nonrecurring


Receipts (24,200,000)




141

NC Health Choice (14446)


2006-07Certified

2006-07 Revised

PercentageChange

Requirements $196,868,437 $196,868,437 0.0 %

Receipts 144,985,535 144,985,535 0.0 %

Appropriation $51,882,902 $51,882,902 0.0 %

Positions 2.000 2.000 0.0 %

Post-Legislative Budget Summary, 2006-07 General FundNC Health Choice

142

Divisions of Services for the Blind, Deaf, and Hard of Hearing (14450)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $25,602,673 $25,677,673 0.3 %

Receipts 15,921,453 15,921,453 0.0 %

Appropriation $9,681,220 $9,756,220 0.8 %

Positions 309.000 309.000 0.0 %


Expansion 2006-07

1. Accessible Electronic Information for Blind and Disabled Persons

The General Assembly approved funding to continue accessible electronic information services for blind and disabled persons.



Receipts -

Appropriation -


Nonrecurring


Receipts -



Post-Legislative Budget Summary, 2006-07 General FundDivisions of Services for the Blind, Deaf, and Hard of Hearing

143

Total Revisions for Divisions of Services for the Blind, Deaf, and Hard of

Hearing 2006-07

Recurring

Requirements -

Receipts -

Appropriation -


Nonrecurring


Receipts -



Post-Legislative Budget Summary, 2006-07 General FundDivisions of Services for the Blind, Deaf, and Hard of Hearing

144

Division of Mental Health/Developmental Disabilities/Substance Abuse Services (14460)


2006-07Certified

2006-07 Revised

PercentageChange

Requirements $1,038,512,538 $1,098,750,895 5.8 %

Receipts 435,955,883 435,955,883 0.0 %

Appropriation $602,556,655 $662,795,012 10.0 %

Positions 11,670.050 11,763.050 0.8 %


Expansion 2006-07

Mental Health System Reform The General Assembly adopted and expanded upon the Governor's recommendations for investing in mental health system reform. Funds were appropriated to support the transformation of community- and institutional-based services with the goal of providing consumers appropriate services in appropriate settings.

1. Expand Community-Based Mental Health Services

Funding was approved to expand community-based mental health. Funds will be allocated to the Local Management Entities (LME) based on population below the federal poverty level.


2. Expand Community-Based Substance Abuse Services

Funding was approved to expand community-based substance abuse services. Funds will be allocated to the Local Management Entities (LME) based on population below the federal poverty level.


3. Funding for the Mental Health Trust Fund

Consistent with G.S. 143-15.3D, funding ($14,390,000) was authorized for program start-up and operating support to provide cost-effective community treatment services. The monies will be held in an interest-bearing, non-reverting reserve in the Office of State Budget and Management.

Post-Legislative Budget Summary, 2006-07 General FundDivision of Mental Health/Developmental Disabilities/Substance Abuse Services

145

4. Funds for Crisis Services

Start-up and ongoing operational funds were appropriated for crisis services. Funds will be allocated to the LMEs to establish a continuum of regional crisis facilities and local crisis services for consumers with mental illness, developmental disabilities, and substance abuse addictions.



5. Consumer Housing Subsidy

The General Assembly appropriated funds to support the development of and operating costs for independent and supported living arrangements for individuals with disabilities. Funds appropriated to the North Carolina Housing Finance Agency ($10,937,500) will encourage the construction of 400 independent and supported living apartments. The operational costs will be subsidized by funds appropriated to the division.


6. Supportive Services for HUD 811 Projects

Funds were appropriated for start-up and operational costs of 12 group-home beds and 80 apartments financed through the United States Department of Housing and Urban Development.



7. Operating Funds for ADATC Renovations

The General Assembly authorized operating funds for the three alcohol drug abuse treatment centers (ADATC) of the Division of Mental Health, Developmental Disabilities, and Substance Abuse Services. Positions for the Julian F. Keith ADATC will be initially funded through the Mental Health Trust Fund. The expanded detoxification capacity will provide a more appropriate treatment setting for substance abusers and reduce the demand for state psychiatric hospital admissions.



8. Funding for Information Technology and Equipment for the Central Regional Psychiatric Hospital

Support for the Central Regional Psychiatric Hospital's information technology infrastructure, which includes network wiring and hardware, and a personal duress alarm system for staff, was authorized via Certificates of Participation ($20,000,000). In S.L. 2003-314, the General Assembly authorized construction of the hospital.

9. Local Management Entities (LME) Consultants

Funding for consultants to aid the division and LMEs was appropriated. Consultants will assist in the planning for crisis services, strategic planning, development of performance indicators, standardization, and service capacity building.


1. Developmental Therapies for Developmentally Disabled Clients

The Governor recommended and the General Assembly approved funding for developmental therapies, a state-funded replacement service for approximately 1,740 developmentally disabled clients who will not qualify for other Medicaid-supported programs. This expansion, coupled with


146

realignment of about $7 million in the Medicaid budget and increased funding of CAP MR/DD slots, will continue services for 5,500 persons with developmental disabilities who were threatened with loss of services due to changes in federal policy and cuts in federal support.


2. Child and Family Support Teams

The General Assembly appropriated funds requested by the Governor to support the Child and Family Support Teams initiative. The funds will be allocated to the Local Management Entities to support 18 Care Coordinators who will provide a vital link for at-risk students and families to appropriate behavioral services.



Receipts -



Nonrecurring


Receipts -



Total Revisions for Division of Mental Health/Developmental

Disabilities/Substance Abuse Services 2006-07

Recurring


Receipts -



Nonrecurring


Receipts -




147

Division of Facility Services (14470)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $46,773,214 $46,973,214 0.4 %

Receipts 30,813,748 30,813,748 0.0 %

Appropriation $15,959,466 $16,159,466 1.3 %

Positions 481.000 481.000 0.0 %


Expansion 2006-07

1. State Regional Advisory Committees

The General Assembly appropriated funds to support the Regional Advisory Committees' planning and coordination of medical system response to local, state, and national disasters.



Receipts -

Appropriation -


Nonrecurring


Receipts -



Post-Legislative Budget Summary, 2006-07 General FundDivision of Facility Services

148

Total Revisions for Division of Facility Services

2006-07 Recurring

Requirements -

Receipts -

Appropriation -


Nonrecurring


Receipts -



Post-Legislative Budget Summary, 2006-07 General FundDivision of Facility Services

149

Division of Vocational Rehabilitation (14480)


2006-07Certified

2006-07 Revised

PercentageChange

Requirements $128,492,298 $128,492,298 0.0 %

Receipts 86,350,105 86,350,105 0.0 %

Appropriation $42,142,193 $42,142,193 0.0 %

Positions 1,036.750 1,036.750 0.0 %

Post-Legislative Budget Summary, 2006-07 General FundDivision of Vocational Rehabilitation

150

RevisedAppropriationsJustice and Public Safety

General Fund

151

Judicial Branch (12000)


2006-07Certified

2006-07 Revised

PercentageChange

Requirements $347,497,137 $374,588,849 7.8 %

Receipts 1,736,727 1,736,727 0.0 %

Appropriation $345,760,410 $372,852,122 7.8 %

Positions 5,283.430 5,555.180 5.1 %



Equipment and Other Reserves 1. Elimination of Reserve

A $1.8 million reserve was established in S.L. 2005-276 for the implementation of House Bill 1048, Governor's DWI Task Force Recommendations. This reserve is eliminated pending the passage of this bill.



Receipts -



Nonrecurring

Requirements -

Receipts -

Appropriation -


Post-Legislative Budget Summary, 2006-07 General FundJudicial Branch

153

Expansion 2006-07

Administration 1. Technology Initiatives

A mix of recurring and nonrecurring funding was provided to support the following technology initiatives: 1) current rewrite of obsolete processing systems for clerks and district attorney/public defender cases, including required data clean-up to implement a statewide warrant repository (NCAWARE); 2) new initiatives related to eCourt, civil eFiling, electronic payments, and electronic traffic court; and 3) maintenance and enhancement of existing applications including eCitation and Casewise/Jwise. Thirty new positions, all with an effective date of July 1, 2006, were also funded to support these technology initiatives. The nonrecurring portion of this technology initiative funding is appropriated to the Court Information Technology Fund, established in G.S. 7A-343.2, and shall not revert.




2. Open File Discovery Project

Funding was provided to develop an evidence tracking automated system that will register the articles of evidence, track their use, and verify that the articles have been disclosed to the appropriate parties as required by law. These funds are appropriated to the Court Information Technology Fund, established in G.S. 7A-343.2, and shall not revert.


3. Justice Building Renovation

Renovations for the Justice Building are scheduled to continue into fiscal year 2006-07, but currently funds for the temporary relocation of staff are only budgeted for fiscal year 2005-06. Funding was provided to continue the lease payments needed for the temporary relocation and for moving expenses once the renovations are complete.


Appellate 1. Court of Appeals Positions

Funding was provided for a new Staff Attorney I and an Appellate Clerk I to address increases in the Appellate workload and to expedite termination of parental rights cases. These positions have an effective date of July 1, 2006.




2. Innocence Claim Review Commission

Funding was provided for three staff positions for the Innocence Claim Review Commission, pending passage of House Bill 1323, Establish NC Innocence Inquiry Commission. The effective date for these positions is January 1, 2007.





154

Trial Courts 1. Deputy Clerk Positions

Funding was provided for 75 new Deputy Clerk positions to address significant increases in certain types of cases such as foreclosures and estate cases. These positions will be assigned by the Director of the Administrative Office of the Courts. The effective date of these positions is January 1, 2007.




2. District Court Judge Positions

Funding was provided for 17 new District Court Judges. These positions have an effective date of January 15, 2007.




3. Magistrate Positions

Funding was provided for six new magistrates to meet the magistrate staffing levels set forth in G.S. 7A-133. These positions have an effective date of July 1, 2006, and will be assigned to the following counties: Carteret, Greene, Alamance, Robeson, Montgomery, and Gaston.




4. District Court Judicial Support Staff

Funding was provided for five new District Court judicial support staff positions (Judicial Assistant I). These positions are needed to support the recently established judgeships, expansion of family mediation, and other arbitration and mediation efforts. The effective date of these positions is July 1, 2006.




5. Expansion of Custody Mediation Program

Funding was provided for 7.75 new support staff to expand the Custody Mediation Program into the final remaining Judicial Districts, as required by G.S. 7A-494(a). The effective date of these positions is July 1, 2006.





155

6. Expansion of Drug Treatment Court

Funding was provided for statewide Drug Treatment Court operations ($49,992). Funding was also provided for three Drug Treatment Court case coordinators to replace federal grant funds that are expiring. These positions have an effective date of July 1, 2006.




7. Guardian ad Litem Positions

Funding was provided for 13 new Guardian ad Litem staff positions to address significant increases in caseloads for the program. These positions include 2 program assistants and 11 regional program supervisors. The effective date of these positions is July 1, 2006.




8. Family Court Program

Recurring funds were provided to continue the operations of the Wake Family Court. In addition, funding was provided to establish two new Family Court Case Coordinator positions: one in Cumberland County and one in Mecklenburg County. The effective date of these positions is July 1, 2006.




9. Interpreter Fee Payments

Funding was provided to increase the budget for interpreter fee payments to the level necessary to meet current needs.


10. Dispute Settlement Centers

Funding was provided to restore prior year budget cuts for the Dispute Settlement Centers and to allow for across-the-board nonrecurring increases for the centers.



11. Juror Fees

Funding was provided to increase the juror fee rates from $12 to $20 per day for days 2 through 5, and from $30 to $40 per day for any additional days. Grand juror fee rates will increase from $12 to $20 per day.


12. Drug Treatment Court for Pre-Plea Offenders

Funding was provided for Drug Treatment Courts for expenses related to treatment and case coordination services for pre-plea offenders.



156

13. Business Court Expansion

Funding was provided for a new Business Court to be located in Wake County. Included in this item is funding for two new staff positions.




Equipment and Other Reserves 1. Critical Equipment Needs

Nonrecurring funds were provided to replace essential technology and office equipment that is six years or older and to replace audio machines in District Court and telephone systems that are ten years or older. In addition, recurring funds were provided for the continued replacement of outdated equipment and systems.



2. Equipment for New Courthouses

Funding was provided for new telephone systems and LAN equipment for the new courthouses located in Clay and Harnett counties.


3. Access to Civil Justice Act Funds

Funding was provided for the North Carolina State Bar to increase the funds available to legal services programs in the state under the Access to Civil Justice Act. This appropriation shall be apportioned to the legal services programs based on the distribution of the fee income currently passed through to the Bar for this purpose.


Offices of the District Attorneys 1. Prosecutors and Support Staff

Funding was provided for 90 new Assistant District Attorneys and 9 Victim-Witness/Legal Assistants. The Assistant District Attorney positions will be allocated based on the workload formula adopted by the Conference of District Attorneys. The Victim-Witness/Legal Assistants will be allocated as specified in the budget bill. These positions have an effective date of January 1, 2007.




2. Split Prosecutorial District 19B

Funding was provided to split prosecutorial district 19B (Randolph, Montgomery, Moore) into 19B (Randolph, Montgomery) and 19D (Moore). This will realign the prosecutorial district on the same lines as the Superior Court district. The effective date for this item is January 15, 2007.




157


Receipts -



Nonrecurring


Receipts -



Total Revisions for Judicial Branch

2006-07 Recurring


Receipts -



Nonrecurring


Receipts -




158

Judicial Branch - Indigent Defense (12001)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $96,832,288 $103,515,417 6.9 %

Receipts 8,183,874 8,183,874 0.0 %

Appropriation $88,648,414 $95,331,543 7.5 %

Positions 299.000 300.000 0.3 %


Expansion 2006-07

Indigent Person Attorney 1. Attorney Fee Payments for Indigent Defense

Nonrecurring funds were provided for unpaid attorney fee applications from fiscal year 2005-06 that need to be carried over to fiscal year 2006-07 due to a funding shortfall.


2. NC Prisoner Legal Services, Inc. Contract

Funding was provided to allow for inflationary increases for the contract with Prisoner Legal Services, Inc. (PLS). Current operating costs for this contract are higher than the total contract amount, creating an operating shortfall for PLS.


3. Hourly Rate for Private Assigned Counsel

Funding was provided to increase the hourly rate for private assigned counsel in capital cases from $85 to $95 at the trial, appellate, and post-conviction levels.


Indigent Defense Services 1. Auditor Position

Funding was provided for an Auditor II position to analyze attorney fee applications and effect cost savings by preventing overbilling.




Post-Legislative Budget Summary, 2006-07 General FundJudicial Branch - Indigent Defense

159

Public Defender Services 1. New Equipment

Funding was provided for the replacement of technology and other office equipment in the Public Defenders' offices.


Sentencing Services 1. Increase in Operating Budget Funding was provided to partially restore prior year budget reductions for Sentencing Services. Appropriation - Nonrecurring $200,000


Receipts -



Nonrecurring


Receipts -



Total Revisions for Judicial Branch - Indigent Defense

2006-07 Recurring


Receipts -



Nonrecurring


Receipts -



Post-Legislative Budget Summary, 2006-07 General FundJudicial Branch - Indigent Defense

160

Department of Justice (13600)


2006-07Certified

2006-07 Revised

PercentageChange

Requirements $100,038,168 $104,745,006 4.7 %

Receipts 21,340,897 21,340,897 0.0 %

Appropriation $78,697,271 $83,404,109 6.0 %

Positions 1,257.246 1,273.246 1.3 %


Expansion 2006-07

Law Enforcement - SBI 1. SBI Staff Expansion

Funding was provided for twelve positions to address the significant demand for investigative and forensic analyses not provided by other North Carolina law enforcement agencies. These positions include five SBI Field Agents, five Non-sworn Drug Chemistry Technicians to handle the growing number of drug sample submissions, one Non-sworn Forensic Analyst for the Computer Crimes Unit, and one Non-sworn Molecular Geneticist to further expedite the processing of DNA evidence and to expand the types of DNA evidence analyzed by the Crime Laboratory. Three of the field agent positions have an effective date of July 1, 2006, and the remaining positions have an effective date of January 1, 2007.




2. Replacement of Statewide Automated Fingerprint Identification System

The North Carolina Statewide Automated Fingerprint Identification System (SAFIS) is a vital informational resource that serves over 500 law enforcement agencies. This system was last upgraded in 1998 and much of the equipment is obsolete and in need of replacement. The Governor recommended and the General Assembly approved funding to replace state and local equipment for the system. Funding was also included for one Application Development Supervisor position to support technical implementation and to provide maintenance.




Post-Legislative Budget Summary, 2006-07 General FundDepartment of Justice

161

3. Lab Expansion

Funding was provided for the purchase of two diesel generators and cubicle furniture to accommodate personnel relocating from Blount Street to Buildings 17 and 18 on the SBI's Garner Road campus.


4. Business Recovery Site

S.L. 2003-404 requires that state agencies vacate their Blount Street facilities so that the buildings may be converted to private ownership. DOJ presently houses both its primary and backup computer centers at its Blount Street offices. For security reasons, a separate business recovery site to house the backup center must be operational before DOJ moves its primary computer center to the SBI's Garner Road campus. The Governor recommended and the General Assembly approved funding for telecommunication charges and IT services charges for this business recovery site.


Legal Services 1. Attorney Positions

Caseloads for DOJ's Appellate and Law Enforcement Liaison Sections have significantly increased in recent years. The Governor recommended and the General Assembly approved funding for two Attorney positions (Attorney II and Attorney III) for the Appellate Section and one Attorney position (Attorney II) for the Law Enforcement Liaison Section to assist existing staff in handling these workload increases.




2. Sex Offender Registry Upgrade

The state's Sex Offender Registry allows residents to obtain information on the addresses of convicted sex offenders in North Carolina. Funding was approved for contractual services to upgrade the registry to include Geographic Information System (GIS) mapping of offenders and public email notification capabilities.


3. Receipt-Supported Tort Claims Positions

DOJ has seen an increase in the demand for tort claim processing services: 2,672 claims were opened by seven adjusters in the last calendar year, an average of 381 claims per adjuster. The General Assembly authorized the establishment of two receipt-supported positions to handle this increased demand and to minimize fraud and abuse related to tort claim processing. The positions, a Tort Claim Adjuster and an Attorney I, will be funded by the Department of Public Instruction.

4. NC LEAF

Funding was provided to the North Carolina Legal Education Assistance Fund (NC LEAF) to increase student loan repayment assistance for qualified law school graduates who accept positions with public or non-profit agencies.



162

5. Receipt-Supported Attorney Position

S.L. 2006-221 authorized the establishment of one receipt-supported Attorney III position to provide legal services to the Department of Cultural Resources. This position will be funded by the Department of Cultural Resources and will focus on administrative law matters involving personnel, procurement and contracting, organizational development, and historical document and artifact recovery. Attorney III - $106,570

Criminal Justice Training and Standards 1. In-Service Law Enforcement Officer Training

Funding was provided to the Criminal Justice Training and Standards Division to develop an online training and registration system that will support division efforts to provide training and certification services to the state's 29,000 law enforcement officers, 7,000 detention officers, and all 911 operators.



Receipts -



Nonrecurring


Receipts -




163

Total Revisions for Department of Justice

2006-07 Recurring


Receipts -



Nonrecurring


Receipts -




164

Department of Juvenile Justice and Delinquency Prevention (14060)


2006-07Certified

2006-07 Revised

PercentageChange

Requirements $149,663,764 $153,118,284 2.3 %

Receipts 10,790,598 10,790,598 0.0 %

Appropriation $138,873,166 $142,327,686 2.5 %

Positions 1,872.500 1,930.500 3.1 %


Expansion 2006-07

Department Management 1. Positions for Administration Division

Funding was provided for two positions to improve operations within DJJDP's Administration Division. These include one Auditor position (Auditor II) to evaluate the cost effectiveness of programs and one Departmental Purchasing Agent position (Purchasing Agent II) to provide support for purchasing and contractual functions.





Funding was provided to address increasing utility and fuel costs from prior year hurricanes and other recent events.


Department-Wide 1. Textbook Purchases

In order to ensure that all juveniles committed to DJJDP facilities are receiving an education consistent with the standard state curriculum, the Governor recommended and the General Assembly approved funding for the purchase of additional textbooks.


Post-Legislative Budget Summary, 2006-07 General FundDepartment of Juvenile Justice and Delinquency Prevention

165

Special Initiatives 1. Eckerd Wilderness Camps Contract

The Eckerd Wilderness Education System is a year-round residential wilderness camp treatment program that addresses the individual needs of adolescents, over half of whom are referred from juvenile court services. Funding was provided to increase the rate for DJJDP's 326 contracted beds from $110.41 per day to $121.77 per day. This increase partially addresses the difference between the department's contracted costs and Eckerd's current-year operating costs for its seven North Carolina camps ($135.32 per day). Funding was also provided to increase the number of contracted beds from 326 to 346.


Youth Development Centers 1. Operating Reserve and Positions for New Treatment Model

Funding was provided to establish an operating reserve for five new Youth Development Centers. Included in this reserve is funding for 56 new positions as well as training and educational assistance for existing staff ($133,875 recurring, $133,875 nonrecurring) as the department transitions to the new therapeutic treatment model.





Receipts -



Nonrecurring


Receipts -




166

Total Revisions for Department of Juvenile Justice and Delinquency

Prevention 2006-07

Recurring


Receipts -



Nonrecurring


Receipts -




167

Department of Correction (14500)


2006-07Certified

2006-07 Revised

PercentageChange

Requirements $1,079,474,513 $1,114,386,217 3.2 %

Receipts 30,982,011 30,982,011 0.0 %

Appropriation $1,048,492,502 $1,083,404,206 3.3 %

Positions 20,375.500 20,528.500 0.8 %



Prisons 1. Delayed Opening of 40-Cell Segregation Buildings

The 40-cell segregation buildings at Orange and Caldwell Correctional Centers were originally scheduled for completion in fiscal year 2006-07. These facilities are now scheduled for completion in fiscal year 2007-08, eliminating the need for the operating reserves that were budgeted for fiscal year 2006-07. Nonrecurring reductions were made as follows: 1) $380,809 for Orange Correctional Center, and 2) $523,621 for Caldwell Correctional Center.


Total Revised Continuation Recurring Requirements -

Receipts -

Appropriation -


Nonrecurring


Receipts -



Post-Legislative Budget Summary, 2006-07 General FundDepartment of Correction

168

Expansion 2006-07

Alcohol and Chemical Dependency 1. Clinical Substance Abuse Supervisor Positions

S.L. 2005-431, Amend Substance Abuse Laws, sets new certification and supervision standards for substance abuse professionals. Funding was provided for two new Clinical Substance Abuse Supervisors (Clinical Administrator IV) to assist the department in complying with these new standards.




2. Residential Substance Abuse Treatment Programs

Federal grants are expiring in fiscal year 2006-07 that support Residential Substance Abuse Treatment (RSAT) clinical staff and programs at the NC Correctional Institution for Women and Morrison Correctional Institution. Funding was provided to continue support for these staff and programs.



3. DART-Cherry Substance Abuse Positions

Funding was provided for five new Substance Abuse Worker positions at the DART-Cherry facility. A Division of Prisons audit of the staffing pattern at this facility concluded that these positions were needed to provide adequate supervision for residents on all shifts.




4. Evergreen Rehabilitation Center Treatment Beds

Funding was provided to increase the contract for private, minimum custody inmate treatment beds at Evergreen Rehabilitation Center. The total treatment beds will increase from 90 to 95, contingent upon the approval of an amended contract by the Department of Administration's Division of Purchase and Contract. This funding is effective October 1, 2006, and is for fiscal year 2006-07 only.


Community Corrections 1. Reserve for Sex Offender Monitoring

Funding was provided to implement active and passive Global Positioning Systems (GPS) monitoring for the most serious convicted sex offenders that are under some form of supervision by the Department of Correction. This funding is contingent upon the passage of House Bill 1902, Senate Bill 1204, or substantially similar legislation on GPS monitoring of sex offenders.





169

2. Increase in CJPP Operating Budget

Funding was provided for the Criminal Justice Partnership Program to restore prior year budget reductions.


3. Probation and Parole Officer Equipment Funding was provided for the replacement of body armor worn by probation and parole officers. Appropriation - Nonrecurring $385,000

4. Women at Risk

Additional funding was provided for Women at Risk, a community-based treatment program that provides an alternative to incarceration for female offenders.


Department Management 1. Medical Claims Management Position

Funding was provided for a new Medical Claims Management position (Reimbursement Officer II). This position will assist with medical claims review and with the integration of the medical claims system with the North Carolina Accounting System (NCAS).




2. Information Technology Security Positions

Funding was provided for two new IT security positions (an IT Manager and a Networking Analyst) to improve computer and network security and allow for the establishment of an IT Security Office. The 2004 Statewide Security Assessment gave the department a low rating and recommended that it have a formal IT Security Office.




3. Computer Security Equipment

Funding was provided to upgrade computer switching equipment at the department's main computer network hub at Yonkers Road offices and at the Lenoir disaster recovery site.


4. Central Engineering Technology

Funding was provided for Central Engineering to purchase automated design equipment, which will allow for more in-house design work.


5. Central Engineering Construction Equipment

Funding was provided for construction equipment needed for inmate labor construction projects, including the Orange and Caldwell 40-cell segregation buildings.



170


Funding was provided to address increasing utility and fuel costs resulting from prior year hurricanes and other recent events.


7. Information Technology Services

Funding was provided to increase the department's budget for information technology services. This appropriation will partially restore prior year budget reductions and address increasing costs for these services.



Prisons 1. Operating Reserve for Tabor Correctional Institution

Funding was provided to establish an operating reserve for Tabor Correctional Institution, which is scheduled for completion in February of 2008.




2. Capacity Increase at Minimum and Medium Custody Facilities

The Division of Prisons does not have sufficient capacity to meet the inmate population increases projected by the NC Sentencing and Policy Advisory Commission. To meet the projected capacity needs, funding was provided for 36 new positions and operating expenses that are needed to increase total bed capacity by 468 across six prisons, including three medium custody facilities (Brown Creek, Harnett, and Lumberton) and three minimum custody facilities (Dan River, Tillery, and Tyrrell). The effective date of the positions is January 1, 2007.




3. Inmate Medical Care

Funding was provided to address the recent significant increases in inmate medical care expenses, which can be attributed to higher service charges and inmate medical visit volumes.



4. Security Threat Group Unit

Funding was provided for the Security Threat Group unit to replace federal grant support that expires in fiscal year 2006-07. The Security Threat Group unit at Foothills Correctional Institution is an initiative to reduce gang violence through a series of programs that focus on cognitive behavior changes.



5. Positions for New Enterprise Janitorial Plant

Correction Enterprises is opening a new janitorial products plant at Warren Correctional Institution to replace the current plant in Harnett County. Funding was provided for eight new


171

Correctional Officers and one new Correctional Sergeant to provide the needed security for the new facility. The effective date of the positions is February 1, 2007.




6. Positions for Central Pharmacy

Prescription volumes have increased 62 percent over the last six years at the Division of Prisons Central Pharmacy with no increase in staff. To address the current staffing needs, funding was provided for three additional positions: one Pharmacy Technician, one Pharmacist, and one Stock Supervisor.




7. Nurse and Medical Records Clerk Positions

Funding was provided for 20 Licensed Practical Nurses (LPN's) and 18 Medical Records Clerks. These positions will aid the Division of Prisons in meeting the nursing standards adopted by the division. In addition, the positions will help to reduce the overall shortage of nurses in the prison system.




8. Inmate Community Work Crews

Funding was provided for six new inmate community work crews. The department is to determine the location of these work crews based on correctional center and community needs.




9. Security Cameras

Funding was provided for additional security cameras in areas such as kitchens, outside yards, and visitation rooms at various prisons.


10. Our Children's Place

Funding was provided for Our Children's Place, a nonprofit organization established to operate a program for incarcerated mothers. This funding is for contractual services, operating expenses, and a new program director position.



172


Receipts -



Nonrecurring


Receipts -



Total Revisions for Department of Correction

2006-07 Recurring


Receipts -



Nonrecurring


Receipts -




173

Department of Crime Control and Public Safety (14900)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $51,125,106 $57,074,386 11.6 %

Receipts 15,971,618 15,966,618 0.0 %

Appropriation $35,153,488 $41,107,768 16.9 %

Positions 484.500 500.500 3.3 %


Expansion 2006-07

Administration 1. Federal Grants Administration Position

Funding was provided for a Federal Grants Accountant (Accountant II) to ensure compliance with federal reporting and control requirements.




2. Information Technology Positions

Funding was provided for one Business and Technology Specialist and one Business and Technology Analyst to ensure that all IT projects are tracked properly and comply with the requirements set forth in S.L. 2004-129, Improve State IT Efficiency and Project Management.



National Guard 1. NC National Guard Soldiers and Airmen Assistance Fund

Funding was provided for the NC National Guard Soldiers and Airmen Assistance Fund, which provides emergency financial assistance to members and their immediate families who are experiencing financial hardship.


Post-Legislative Budget Summary, 2006-07 General FundDepartment of Crime Control and Public Safety

174

2. Deputy Division Director Position

Funding was provided for a Deputy Division Director for the NC National Guard. This position will assist with day-to-day operations and management of federal activities.



3. National Guard Pension Fund

Funding was provided for the NC National Guard Pension Fund. These funds will be used to increase the monthly pension benefit payment to current and future retirees from a maximum of $150 to a maximum of $160.


4. Armory Maintenance and Repair

Funding was provided for statewide armory maintenance and repair needs such as roof repairs, boiler repairs and replacement, electrical upgrades, and fire alarm systems.


Butner Public Safety 1. Operations and Maintenance

Funding was provided to support the basic operating and maintenance needs for Butner Public Safety. The budget for Butner Public Safety has been affected by previous budget cuts, inflationary increases, and overbudgeted receipts.


Receipts ($5,000)


Emergency Management 1. Planning, Response, and Recovery Capabilities

Funding was provided to enhance emergency management planning, response, and recovery capabilities by converting 11 temporary, receipt-supported positions to permanent positions. Included are one Emergency Management Assistant Director, two Emergency Management Section Managers, one Emergency Management Section Chief, five positions for Community Development Specialist II, and one Community Development Specialist I. In addition, nonrecurring funding was provided to support rent, utilities, and other operating expenses associated with the two division warehouses.




2. Urban Search and Rescue and Swiftwater Rescue Capabilities

Funding was provided for training and equipment to ensure that the state's Urban Search and Rescue and Swiftwater Rescue teams are able to meet the current National Incident Management System qualification standards. Future federal funding of emergency management operations may be jeopardized if these standards are not met this year.



175

3. HAZMAT Regional Response Teams

Funding was provided for operating expenses for the seven HAZMAT Regional Response Teams in the state. Currently, only six of these teams receive dedicated state appropriation, and all of the teams lack sufficient operating budgets for items such as rising insurance premiums and equipment replacement.


Victim and Justice Services 1. Victims Compensation

There is a continuing backlog of Victims Compensation claims due to insufficient funding and shortage of staff to properly investigate and examine claims received. To address this backlog, funding was provided for payment of claims ($1,000,000 NR) and for a new Law Enforcement Specialist position to investigate and process claims.




Governor's Crime Commission 1. Gang Violence Intervention and Suppression

Funding was provided for competitive grants for gang violence prevention, intervention, and suppression initiatives. Eligibility for these awards is limited to local governments and community organizations.


State Highway Patrol 1. VIPER Network Expansion

A nonrecurring appropriation of $10,000,000 from the Highway Fund was provided to continue the expansion of the VIPER voice radio network for public safety agencies.

2. VIPER Maintenance

A recurring appropriation of $208,892 from the Highway Fund was provided for maintenance of those components of the VIPER system that are currently in place.

3. Conversion of Temporary Positions to Permanent

A recurring appropriation of $552,501 from the Highway Fund was provided to convert 17 temporary positions to permanent positions. Included are eight positions for Tradesworker III, eight positions for Office Assistant IV, and one Aircraft Mechanic.

4. State Trooper Positions

An appropriation from the Highway Fund of $393,056 ($213,160 recurring and $179,896 nonrecurring) was provided for four new Trooper positions.


176


Receipts (5,000)



Nonrecurring


Receipts -



Total Revisions for Department of Crime Control and Public Safety

2006-07 Recurring


Receipts (5,000)



Nonrecurring


Receipts -




177


Natural and Economic Resources

General Fund

179

Department of Agriculture and Consumer Services (13700)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $74,289,632 $77,954,694 4.9 %

Receipts 23,256,748 23,338,248 0.4 %

Appropriation $51,032,884 $54,616,446 7.0 %

Positions 1,173.750 1,204.750 2.6 %


Expansion 2006-07

General Administration 1. Human Resources The General Assembly established one Personnel Technician position in Human Resources. Appropriation $97,382


2. Agricultural Review

The General Assembly increased funding for the Agricultural Review to address rising operating costs.


Research Stations and State Farms 1. Reduce Research Station Receipts

The Research Stations have transitioned the production farms to research farms, resulting in decreased receipts. The problem has grown worse due to declining commodity prices and increased costs of inputs for research. The Governor recommended replacing unrealized receipts with appropriations and the General Assembly appropriated nonrecurring funds for this purpose.

Appropriation -


Post-Legislative Budget Summary, 2006-07 General FundDepartment of Agriculture and Consumer Services

181

Emergency Programs 1. Emergency Programs Expansion

To address the current threat of diseases, such as Avian Influenza, Exotic New Castle, Bovine Spongiform Encephalopathy, and any other emerging or potential Foreign Animal Diseases (FAD), the Governor recommended converting receipt-supported positions to appropriation-supported. The General Assembly established two new positions and shifted two existing positions from receipt-support.



2. Multi-Hazard Threat Database

The General Assembly appropriated funding for operating expenses associated with the Multi-Hazard Threat Database.


Food and Drug Protection 1. Food Safety

The inspection and survey programs of the Food and Drug Protection Division are key factors in allowing our citizens to enjoy a safe food supply. With additional personnel, the division can incorporate food defense into the existing food safety programs. The Governor recommended additional staff and the General Assembly appropriated funding for 11 new positions in food protection, compliance, and regulations.



2. Distillation System

The General Assembly appropriated funding to replace the water distillation system at Constable Laboratory.


3. Pesticide Staffing Support The General Assembly established three additional positions in the Pesticide section. Appropriation $194,429



4. Lab Equipment

The General Assembly appropriated funding for the purchase and replacement of lab equipment.


5. Pesticide Disposal Program

The General Assembly restored General Fund appropriations to the Pesticide Disposal Program, reversing reductions made in FY 2005/06.



182

Meat and Poultry Inspection 1. Food Safety and Security Mandates

As mandated by the USDA, the Department of Agriculture and Consumer Services must provide on-site inspection at slaughter and processing establishments. At slaughter establishments, an inspector must be present throughout the slaughter process. At processing establishments, an inspector must be present at some period each day the plant operates. The increasing number of plants exceeds the current number of available inspectors. The Governor recommended funding new meat inspectors and the General Assembly funded six new positions.


Receipts $81,500



Veterinary Services 1. Director of Laboratory Operations The General Assembly appropriated funding for a Director of Laboratory Operations position. Appropriation $147,172


Marketing 1. Domestic Marketing

The General Assembly provided additional funding for the ''Got to be NC'' agricultural marketing initiative and established one Agricultural Marketing Specialist position.




Plant Protection 1. Export Certification Program

The Governor recommended establishing an Export Certification Specialist to respond to the increased demand for issuance of phytosanitary certificates in North Carolina. The General Assembly appropriated funding for two positions.



2. Fertilizer Receipts The General Assembly replaced a portion of unrealized fertilizer receipts with appropriations. Appropriation - Nonrecurring $100,000


183

Standards 1. Standards Inspectors

The General Assembly created two additional Standards Inspector positions to inspect retail motor fuel dispensers and retail weights and measures devices.





Receipts 81,500



Nonrecurring


Receipts -



Total Revisions for Department of Agriculture and Consumer Services

2006-07 Recurring


Receipts 81,500



Nonrecurring


Receipts -




184

Department of Labor (13800)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $27,159,328 $27,773,222 2.3 %

Receipts 12,724,403 12,724,403 0.0 %

Appropriation $14,434,925 $15,048,819 4.3 %

Positions 432.000 435.500 0.8 %


Expansion 2006-07

Administrative Division 1. Operating Funding

The Governor recommended that the Department of Labor receive additional operational funding and the General Assembly appropriated $213,894 for travel and office.


Mine and Quarry Division 1. Appropriation for Mine and Quarry Division

During the last session, the Mine and Quarry Division was changed from full appropriation to a mix of appropriation and receipts from a new fee. The fee is not bringing in enough funds to support the division. The Governor recommended abolishing the fee and supporting the division with appropriations. The General Assembly approved funding to offset unrealized fee receipts and shifted 3.5 positions from receipt to appropriation supported.



Elevator and Amusement Device Bureau 1. Receipt-Supported Positions

The General Assembly approved two receipt supported positions to inspect elevator and amusement devices.

Post-Legislative Budget Summary, 2006-07 General FundDepartment of Labor

185

Occupational Safety and Health 1. Fund Operating

The General Assembly appropriated funds for various operating line items in Occupational Safety and Health.



Receipts -



Nonrecurring


Receipts -



Total Revisions for Department of Labor

2006-07 Recurring


Receipts -



Nonrecurring


Receipts -



Post-Legislative Budget Summary, 2006-07 General FundDepartment of Labor

186

Department of Environment and Natural Resources (14300)


2006-07Certified

2006-07 Revised

PercentageChange

Requirements $280,386,294 $295,238,256 5.3 %

Receipts 111,935,205 111,935,205 0.0 %

Appropriation $168,451,089 $183,303,051 8.8 %

Positions 3,352.130 3,377.130 0.7 %


Expansion 2006-07

Aquariums 1. Operating Funds The General Assembly approved funds to provide support for the operations of the aquariums. Appropriation - Nonrecurring $2,500,000

CGIA 1. NC One Map

The General Assembly approved funds to enhance the NC One Map system to provide around-the-clock daily access and to provide technical assistance to local governments connecting to NC One Map. The funding will provide for one position.




Coastal Management 1. Coastal Habitat Protection Compliance Positions

The Governor recommended and the General Assembly approved the establishment of four Compliance Coordinator positions, one to be placed in each Division of Coastal Management district to provide compliance and enforcement services in a uniform and consistent manner. This

Post-Legislative Budget Summary, 2006-07 General FundDepartment of Environment and Natural Resources

187

request is in response to the 1997 Fisheries Reform Act, which required the Department of Environment and Natural Resources (DENR) to develop a Coastal Habitat Protection Plan to enhance and restore coastal fisheries.




DFR Forestry Field Organization 1. Forest Development Program (FDP) Funding Increase

Appropriations were provided to support additional funding to reduce the current waiting list of landowner applicants for cost-shared assistance to reforest land.


Environmental Health 1. Fund Wastewater Treatment Consultants

Funding was approved for two positions to provide technical on-site assistance to customers requesting wastewater permits for septic tanks.



2. Fund Shellfish Sanitation Positions

The General Assembly provided funds to establish three positions to monitor and classify North Carolina's shellfish growing waters and to conduct the shoreline survey.




3. Emergency Drinking Water Funds

The legislature provided funds to notify, to the extent practicable, persons aged 18 and older who reside in any dwelling unit and the senior official in charge of any business at which drinking water is supplied from a private drinking-water well that is located within 1,500 feet of known groundwater contamination.


4. Private Well-Water Safety Program

In rural areas, almost all private water-supply wells serve individual homes or groups of homes too small to be regulated under the NC Drinking Water Act. The improper location, construction, operation, repair, maintenance, and abandonment of private wells, and the improper installation and repair of pumps and pumping equipment, can adversely affect the quality of drinking water for well-users, create safety hazards, and create a conduit for groundwater contamination. Consistent with its duty to protect the public health and safety and to protect the state's resources, the Division of Environmental Health intends to regulate private wells to provide for proper location, construction, operation, repair, maintenance, and abandonment and to regulate the installation and repair of pumps and pumping equipment used with private wells. Funding was approved to establish five positions to serve as technical support and enforcement assistance to 100 counties as


188

they enforce statewide private-water-supply well-construction standards. The funding will also provide nonrecurring pass-through incentive funds to local health departments to provide start-up funds for counties that do not currently have well-construction programs.




5. Protection of Drinking Water Supplies - Fees Increase

State and federal laws require public water systems to provide safe drinking water. Existing shortfalls in staffing levels have resulted in decreasing levels of service and oversight and have threatened the ability to protect the quality of North Carolina's waters used for drinking. New fee revenue will fund nineteen additional positions for field response, inspections, technical assistance, compliance oversight, laboratory support, and review and approval of plans to protect public drinking water supplies. Positions will be funded as fee revenue is generated, with seven positions funded in FY 2006-07 and the remaining positions funded in FY 2007-08.

Land Resources 1. Restore Contractual Services

The General Assembly approved the restoring of funds to support contractual services for a county boundary program eliminated in FY 2005-06.


Marine Fisheries 1. Coastal Recreational Fishing License Implementation

Funding was approved by the General Assembly to establish two positions and operating support for the development and operations of the licensing system associated with the Coastal Recreational Fishing License (CRFL). These positions will be funded with receipts generated from the sale of CRFLs, effective FY 2007-08.



2. Shellfish Mapping and Submerged Aquatic Vegetation Mapping Program

The General Assembly approved funding to provide five additional positions and operating expenses to enable the Marine Fisheries Division to map shellfish resources and habitat as recommended by the Coastal Habitat Protection Plan.




Soil and Water Conservation 1. NC Agricultural Cost-Shared Technical Assistance

The General Assembly approved recurring funding to provide support for cost-shared funds to soil and water conservation districts and counties for technical assistance needed to install best management practices through the Agricultural Cost-Shared Program. The funds are used for salaries and operating expenses for 121 Agricultural Cost-Shared Technicians in 96 local soil and


189

water conservation districts who do the planning and oversee installations of agricultural best management practices.


2. NC Agricultural Cost Share - Financial Assistance

The Governor recommended and the General Assembly approved funding to enable the local soil and water conservation districts to assist 100 additional producers per year to install best management practices on private working agricultural lands to improve water quality.



3. Extend CREP Program to Other Watersheds

The General Assembly approved additional funding to support the expansion of the Conservation Reserve Enhancement Program (CREP) into additional watersheds in need of riparian buffers and restored wetlands. With additional watersheds eligible for enrollment, the state will be more likely to achieve the full potential for the CREP and take advantage of the $221 million of federal funding committed for CREP in North Carolina.




4. Soil and Water Conservation District Supervisor Travel

The legislature provided funding for travel reimbursement for soil and water conservation district supervisors.


5. Poultry Waste Management Best Practices

The General Assembly approved funding for new poultry waste management best practice techniques.


Water Quality 1. Fund Water Quality Monitoring on Ferry Vessels

Funds were provided for the Ferrymon Program, which evaluates water quality in the Pamlico Sound and its tributary rivers using equipment attached to three ferry vessels.


Reserves and Special Funds 1. Resource Conservation and Development Council Funds

The General Assembly approved funds to support the state's ten Resource Conservation and Development Councils. Each council will receive a grant totaling $20,000.


2. Drinking Water State Revolving Fund Match

The Governor recommended and the General Assembly approved funding to support the 20% state match requirement for drawing down the maximum available federal funds for the Drinking Water State Revolving Fund.



190

3. Increase Grassroots Science Museum Funds The General Assembly approved additional funding for the Grassroots Science Program. Appropriation - Nonrecurring $133,578

4. Wastewater Treatment Plant State Revolving Fund Match

Funding was adjusted to meet the 20% state match requirement for drawing down the maximum available federal funds for the Wastewater Treatment Plant State Revolving Fund.


5. Monitoring and Emergency Cleanup of the Texfi Site Contamination

The General Assembly provided funds for additional monitoring and cleanup of contamination at the Texfi site.



Receipts -



Nonrecurring


Receipts -




191

Total Revisions for Department of Environment and Natural Resources

2006-07 Recurring


Receipts -



Nonrecurring


Receipts -




192

DENR - Clean Water Management Trust Fund (14301)


2006-07Certified

2006-07 Revised

PercentageChange

Requirements $100,000,000 $100,000,000 0.0 %


Positions - -

Post-Legislative Budget Summary, 2006-07 General FundDENR - Clean Water Management Trust Fund

193

Department of Commerce (14600)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $88,275,553 $126,743,036 43.6 %

Receipts 51,547,288 53,647,288 4.1 %

Appropriation $36,728,265 $73,095,748 99.0 %

Positions 442.930 451.930 2.0 %


Expansion 2006-07

Division of Policy and Research - Economic Development 1. Additional Staffing for Policy, Research, and Strategic Planning

The Governor requested additional staffing for the division in order to strengthen North Carolina's ability for strategic research and planning for economic development. The General Assembly appropriated funding for three new positions.



MIS Division 1. Additional Staff for MIS

The Governor recommended and the General Assembly appropriated funding for a position that will develop and maintain a better Web site for the department. This will allow business and decision makers doing research via the Web to access up-to-date information.




Post-Legislative Budget Summary, 2006-07 General FundDepartment of Commerce

194

Local Planning and Management 1. Small Town Main Street Program - Expansion into Western NC

Recent economic changes have led to vacancies and general decline in the downtown core of many smaller towns throughout the state. The Governor recommended that a Community Development Planner be added to assist western NC communities, and the General Assembly appropriated $71,965 for one position. The program already exists in eastern NC with the help of a Z. Smith Reynolds grant.



2. 21st-Century Communities Program

The Governor recommended expanding the NC 21st-Century Program, which identifies communities that are experiencing challenges relative to economic stability and helps them become more competitive in the global economy. The General Assembly appropriated $244,699 for this program.



Administrative Services 1. Pass-Through Monitoring Position and Administrative Support Cost

The Governor recommended an additional staff position and an increase in operating expenses to assist the department in monitoring pass-through funds. The General Assembly appropriated recurring and nonrecurring funds totaling $150,000 for this purpose.




Industrial Commission 1. Replace Electronic Document System

The Governor recommended and the General Assembly appropriated funding to aid in the replacement of the failing Electronic Document Management system. The system is 25 years old and is a legacy mainframe database program.





195

One North Carolina Fund 1. Industrial Recruitment Competitive Fund

The Governor recommended funding for the One NC Fund, and the General Assembly appropriated $15.0 million in nonrecurring funds. Funds will be used to offset the cost of developing infrastructure and other permissible costs associated with newly locating or expanding, high growth, high value operations throughout the state.


One North Carolina Small Business Program 1. Small Business Innovation and Technology Incentive Program

The Governor recommended funding the federal Small Business Innovation Research (SBIR)/Small Business Technology Transfer Research (SBTTR) matching program, and the General Assembly appropriated $5.0 million in nonrecurring funds for this purpose. The program is incentive funding to encourage small, innovative NC businesses to apply for federal small business innovation grants.


Marketing and Customer Services 1. Promoting North Carolina as a Business Destination

The Governor recommended increased advertising dollars to market North Carolina. The General Assembly appropriated $1.0 million for this purpose. These funds will pay for traditional advertising in business publications, public relations outreach, marketing materials, national and international industry trade shows, and conference participation.



2. Furniture Market Advertising

The General Assembly appropriated funding for the High Point International Home Furnishings Market Authority Corporation to promote the International Home Furnishings Market.



Tourism, Film, and Sports Development 1. Motor Sports Program

The Governor recommended funding to help promote motor sports in North Carolina, and the General Assembly appropriated $100,000 for this purpose.


2. Marketing Reserve The General Assembly appropriated $1.0 million for a statewide marketing reserve. Appropriation $500,000



196

3. Promote Film Industry The General Assembly appropriated $250,000 to expand and promote the film industry. Appropriation - Nonrecurring $250,000

Reserves and Transfers 1. Economic Development Reserve Fund The General Assembly appropriated reserve funds for economic development projects. Appropriation - Nonrecurring $10,000,000


Receipts -



Nonrecurring


Receipts 2,100,000



Total Revisions for Department of Commerce

2006-07 Recurring


Receipts -



Nonrecurring


Receipts 2,100,000




197

Commerce - State Aid to Non-State Entities (14601)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $47,358,087 $56,561,225 19.4 %


Positions - -


Expansion 2006-07

North Carolina Biotechnology Center 1. Funding for NC Biotechnology Center

The Governor recommended converting $1.5 million in nonrecurring funds to recurring and the General Assembly appropriated $1.5 million in recurring funds and $500,000 in nonrecurring funds for the center.



2. Support of Regional Offices

The Governor recommended and the General Assembly appropriated funding to support the Biotechnology Center's regional offices. The regional offices allow staff to provide direct assistance and to strengthen community capabilities for biotechnology research, education, company development and recruitment, and job creation.


Rural Economic Development Center 1. Transfer the e-NC Authority

The General Assembly transferred funds from the Rural Center's fund code to the Department of Commerce's State Aid to Non-State Entities.


Post-Legislative Budget Summary, 2006-07 General FundCommerce - State Aid to Non-State Entities

198

e-NC Authority 1. Transfer the e-NC Authority

The General Assembly transferred funds from the Rural Center's fund code to the Department of Commerce's State Aid to Non-State Entities fund code.


Advanced Vehicle Research Center 1. Advanced Vehicle Research Center The General Assembly appropriated funding for the construction and operation of this center. Appropriation - Nonrecurring $3,750,000

Land Loss Prevention Project 1. Land Loss Prevention Project

The General Assembly increased funding for the Land Loss Prevention Project to aid in the legal representation of financially distressed small farmers and rural landowners.



North Carolina Association of Community Development Corporations 1. NCACDCs

The General Assembly increased funding for the North Carolina Association of Community Development Corporations.


Minority Support Center 1. Minority Support Center

The General Assembly appropriated funding for the Minority Support Center to support the Generations Credit Union and the Latino Community Credit Union.


Community Development Initiative 1. CDI The General Assembly appropriated funding for the Community Development Initiative. Appropriation - Nonrecurring $500,000

North Carolina Institute of Minority Economic Development 1. NC Institute of Minority Economic Development

The General Assembly appropriated additional funding for the NC Institute of Minority Economic Development.



199


Receipts -



Nonrecurring


Receipts -



Total Revisions for Commerce - State Aid to Non-State Entities

2006-07 Recurring


Receipts -



Nonrecurring


Receipts -




200


Transportation

Highway Fund

Highway Trust Fund

201

Department of TransportationOverview

Highway Highway Department FederalDepartment of Transportation Fund Trust Fund Receipts Funds Total

Administration 84,305,914$ 7,761,140$ 311,000$ -$ 92,378,054$

Division of Highways Administration 30,632,164 23,120,989 486,112 - 54,239,265 Construction 179,189,500 938,723,584 - 838,880,000 1,956,793,084 Maintenance 881,699,706 - - - 881,699,706 Planning and Research 4,280,000 - - 17,120,000 21,400,000 OSHA Program 425,000 - - - 425,000

Ferry Operations 22,264,811 - - - 22,264,811

State Aid Municipalities 94,089,500 62,690,874 - - 156,780,374 Public Transportation 75,866,447 - - 10,000,000 85,866,447 Airports 15,295,066 - - 15,478,062 30,773,128 Railroads 20,299,903 - - - 20,299,903

Governor's Highway Safety 293,118 - - 4,609,283 4,902,401 Division of Motor Vehicles 97,354,838 4,396,910 4,212,093 4,053,680 110,017,521 Other State Agencies 226,323,399 400,880 - - 226,724,279 Reserves and Transfers 61,420,634 - - - 61,420,634 Transfer to General Fund - 57,486,602 - - 57,486,602 Uncommitted Trust Fund Admin. - 6,049,021 - - 6,049,021 Total Operating 1,793,740,000 1,100,630,000 5,009,205 890,141,025 3,789,520,230

Grand Total1 1,793,740,000$ 1,100,630,000$ 5,009,205$ 890,141,025$ 3,789,520,230$

North Carolina Transportation Program2006-07

Table 9

1 Highway Fund total includes $17.6 million transfer from the General Fund to hold the Highway Fund harmless from capping the variable component of the Motor Fuels Tax at the January 1, 2006, rate for 2006-07.Highway Trust Fund total includes $5.7 million transfer from the General Fund to hold the Highway Trust Fund harmless from capping the variable component of the Motor Fuels Tax at the January 1, 2006, rate for 2006-07.

Funds totaling $3.8 billion for 2006-07 are required to support North Carolina's transportation program. Approximately $1.7 billion, or 47%, will be provided from the Highway Fund. The Highway Trust Fund will add approximately $1.1 billion or 29% this fiscal year.

Departmental receipts will add an additional $5 million with federal funds totaling $890 million. The General Fund will provide $23.3 million if required to hold the Highway Fund and Highway Trust Fund harmless from capping the variable portion of the Motor Fuels Tax at the January 1, 2006 rate for 2006-07.

Summaries of the total transportation program showing the source of funding and activities supported appear below. Details about funding from the Highway Fund and the Highway Trust Fund follow the summary.

Post-Legislative Budget Summary, 2006-07 Transportation

203

Figure 14

Funding SourcesNorth Carolina Transportation Program

2006-07

Highway Fund47.3%Department

Receipts0.1%

Federal Funds23.5%

Highway Trust Fund

29.0%

Figure 15

AppropriationsNorth Carolina Transportation Program

2006-07

Maintenance 23.3%

Construction 52.2%

Other Programs 0.1%

Ferry Operations 0.6%

Administration 4.0%

Division of Motor Vehicles 2.9%Reserves 1.6%

Transfers to Other State Agencies

7.5%

State Aid 7.8%


204

Figure 16

Highway Fund Appropriations2006-07

Transfers to Other State Agencies

226,323,399 14%

DOT Administration $114,938,078

6%

Maintenance, 881,699,706

50%

Construction, 183,469,500

10%State Aid to Municipalities 94,089,500

5%

Other Programs and Reserves

62,138,752 3%

Division of Motor Vehicles

97,354,838 5%

Public Transportation 111,461,416

6%

Ferry Operations 22,264,811

1%Total : $1,793,740,000

Figure 17

Highway Trust Fund Appropriations 2006-07

Instrastate System 597,492,253

54%

Administration 41,728,940

4%

Transfer to General Fund

57,486,602 5%

Urban Loops System

241,600,983 22%

Secondary Roads 99,630,348

9%

State Aid to Municipalities 62,690,874

6%

Total: $1,100,630,000


205

General Fund Budget Changes - Transportation (14222)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $0 $0 Receipts - - Appropriation $0 $0 Positions - -

Post-Legislative Budget Summary, 2006-07 TransportationGeneral Fund

206

2005-06 2006-07 Changes Per 2006-07Appropriated Previously Certified Senate Bill 1741 Revised Certified

Availability

Beginning Credit Balance Appropriation Reversions 10,490,000$ -$ 26,600,000$ 26,600,000$ Overrealized Revenue - - - - Subtotal 10,490,000 - 26,600,000 26,600,000

Transfer from General Fund1 - - 17,600,000 17,600,000 State Highway Fund Revenue 1,627,520,000 1,697,940,000 51,600,000 1,749,540,000

Total Availability 1,638,010,000 1,697,940,000 95,800,000 1,793,740,000

Expenditures and Commitments Expended and Reserved 1,638,010,000 1,538,908,929 254,831,071 1,793,740,000

Ending Credit Balance -$ 159,031,071$ (159,031,071)$ -$

Table 10

Condition of the Highway Fund 2006-07

1 Transfer being made to hold the Highway Fund harmless from capping the variable component of the Motor Fuels Tax at the January 1, 2006, rate for 2006-07.

Post-Legislative Budget Summary, 2006-07 TransportationHighway Fund

207

2005-06Appropriated

2006-07Previously

Certified

Changes PerSenate Bill

1741

2006-07Revised Certified

DOT-General Administration 82,254,119$ 81,805,914$ 2,500,000$ 84,305,914$ Highway Division Administration 30,621,612 30,632,164 - 30,632,164 Federal Aid Match - Planning and Research 4,280,000 4,280,000 - 4,280,000

Construction Program State Secondary System 91,910,000 92,650,000 1,439,500 94,089,500 State Urban System 14,000,000 14,000,000 - 14,000,000 Discretionary Funds 15,000,000 15,000,000 - 15,000,000 Spot Safety Improvements 9,100,000 9,100,000 - 9,100,000 Access and Public Service Roads 2,000,000 2,000,000 - 2,000,000 Small Urban Construction 35,000,000 7,000,000 38,000,000 45,000,000 Total Construction Program 167,010,000 139,750,000 39,439,500 179,189,500

Maintenance Program Primary System 124,750,498 124,750,498 - 124,750,498 Secondary System 214,243,652 214,243,652 - 214,243,652 Urban System 40,079,682 40,079,682 - 40,079,682 Contract Resurfacing 186,208,316 186,208,316 88,317,347 274,525,663 System Preservation - - 78,589,071 78,589,071 General Maintenance Reserve 239,432,391 149,511,140 - 149,511,140 Total Maintenance Program 804,714,539 714,793,288 166,906,418 881,699,706

Ferry Operations 21,264,811 21,264,811 1,000,000 22,264,811 State Aid to Municipalities 91,910,000 92,650,000 1,439,500 94,089,500 State Aid to Railroads 17,308,153 17,101,153 3,198,750 20,299,903 State Aid for Public Transportation 66,466,447 89,866,447 (14,000,000) 75,866,447 Airports 11,634,198 13,295,066 2,000,000 15,295,066 Asphalt Plant Cleanup 425,000 425,000 - 425,000 Governor's Highway Safety Program 293,118 293,118 - 293,118 Division of Motor Vehicles 96,047,914 95,468,137 1,886,701 97,354,838

Total Department of Transportation 1,394,229,911 1,301,625,098 204,370,869 1,505,995,967

Transfers to Other State Agencies Agriculture 4,115,930 4,234,921 37,160 4,272,081 Revenue 4,873,784 4,877,766 - 4,877,766 State Treasurer - - - - Public Instruction-Driver Education 31,867,200 32,059,200 457,971 32,517,171 CCPS - Highway Patrol 175,534,211 166,804,276 11,154,449 177,958,725 DENR - LUST Trust Fund 6,010,286 6,337,313 (187,160) 6,150,153 DHHS - Chemical Test 546,826 547,503 - 547,503 Total-Other State Agencies 222,948,237 214,860,979 11,462,420 226,323,399

Reserves and Transfers Salary Adjustment 650,000 650,000 1,000,000 1,650,000 Minority Contractor Development 150,000 150,000 - 150,000 State Fire Protection Grant 150,000 150,000 - 150,000 Stormwater Discharge Permit 500,000 500,000 - 500,000 Weigh Station Improvements - - 12,824,782 12,824,782 Reserve for Visitor's Centers 400,000 400,000 - 400,000 Global Transpark 1,600,000 1,600,000 - 1,600,000 Reserve for Administrative Reduction - - (2,500,000) (2,500,000) Reserve for Legislative Increase 10,364,000 10,364,000 26,334,000 36,698,000 Reserve for Health Insurance Adjustment 5,070,000 6,661,000 - 6,661,000 Reserve for Disability Income Plan 13,500 13,500 - 13,500 State Employee Reserve 842,658 842,658 - 842,658 Employer's Contribution to Retirement 1,037,494 1,037,494 1,339,000 2,376,494 Employer's Contribution to Death Benefit 54,200 54,200 - 54,200 Total Reserves 20,831,852 22,422,852 38,997,782 61,420,634

Total Current Operations 1,638,010,000 1,538,908,929 254,831,071 1,793,740,000

Capital Improvements - - - -

Total Highway Fund Appropriation 1,638,010,000$ 1,538,908,929$ 254,831,071$ 1,793,740,000$

Table 11

Changes to the Highway Fund BudgetFY 2006-07


208

Highway Fund Budget Changes (84210)


2006-07Certified

2006-07 Revised

PercentageChange

Requirements $2,493,335,476 $2,748,166,547 10.2 %

Receipts 954,426,547 954,426,547 0.0 %

Appropriation $1,538,908,929 $1,793,740,000 16.6 %

Positions - -



Mandated Adjustments 1. Statutory Adjustments to Leaking Underground Storage Tank Fund

In accordance with G.S. 105-119.18(a) and (b), the Governor recommended and the General Assembly approved an adjustment to the appropriation for the Leaking Underground Storage Tank Fund to bring the allocation in line with current Highway Fund revenue projections for the gasoline inspection fee.


2. Statutory Adjustment to Aid to Municipalities Allocation

In accordance with G.S. 136-41.1, the Governor recommended and the General Assembly approved an adjustment based on the estimated gallons of motor fuel sold to bring the allocation for state aid to municipalities in line with current revenue projections.


3. Statutory Adjustment to Secondary Roads Construction Allocation

In accordance with G.S. 136-44.2A, the Governor recommended and the General Assembly approved an adjustment based on the estimated gallons of motor fuel sold to bring the allocation for secondary roads construction in line with current revenue projections.



209


Receipts -



Nonrecurring

Requirements -

Receipts -

Appropriation -


Expansion 2006-07

Maintenance 1. Contract Resurfacing

The Governor recommended and the General Assembly approved an increase in the funds for contract resurfacing to address growing needs for highway asphalt overlays as pavement conditions continue to degrade due to increased lane mileage and vehicle miles traveled. An increase in the cost of highway construction materials has reduced the number of miles resurfaced each year.


2. System Preservation

The Governor recommended and the General Assembly approved funds for highway maintenance activities that preserve and extend the life of infrastructure assets, including pavements, bridges, and traffic signal systems.


Weigh Station Improvements 1. Automated Weigh Stations

The Governor recommended and the General Assembly approved partial funding for weigh station improvements identified in a 2005 statewide feasibility study. The study concluded that $97.4 million is required between 2006 and 2013 to implement the proposed recommendations.

Appropriation -



210

Small Construction 1. Economic Development

The Governor recommended and the General Assembly approved additional nonrecurring funds for economic development, spot safety, and transportation improvement projects. An additional $10 million was approved for statewide projects.


Ferry Division 1. Ferry Maintenance The General Assembly approved additional funds for the ferry maintenance facility. Appropriation - Nonrecurring $1,000,000

Public Transportation 1. Reduction in New Starts Program Funding

The Governor recommended and the General Assembly approved a reduction in public transportation funding for the state's New Starts program for 2006-07. The reduction represents decreased expenditures for the Triangle Transit Authority's commuter rail project.

Appropriation -


2. Statewide Grant Program

The Governor recommended and the General Assembly approved an increase in state funding for public transportation to match increased federal funds provided through the latest federal transportation reauthorization bill. Federal funds cannot be utilized without committed state and/or local matching funds.



3. Urban and Regional Program

The Governor recommended and the General Assembly approved an increase in funds for the State Maintenance Assistance Program (SWAP), to provide operations assistance to regional, urban, and small urban transit systems. The funds will be used to match the Federal Transit Administration's Section 5307 Urbanized Area Formula Program and Section 5309 Capital Program grants.


4. Urban/Regional Bus and Facility Program

The Governor recommended and the General Assembly approved an increase in funds for the Urban/Regional Bus and Facility Program to assist local governments in matching federal transit administration grants authorized through the latest federal transportation reauthorization bill.



211

Aeronautics 1. Rural Airport Development

The Governor recommended and the General Assembly approved funding to expand the current State Aid to Airports Program to provide assistance to rural airports for capital improvement projects.


Rail 1. Piedmont and Carolinian Operations

The Governor recommended and the General Assembly approved an increase in funds to cover the operational costs of the state-sponsored Piedmont and Carolinian passenger trains. This is a nonrecurring increase and will allow the Transportation Oversight Committee to analyze the benefits and make a recommendation about future funding.


2. Short-Line Railroads

The Governor recommended and the General Assembly approved funds for the grant program supporting short-line railroad companies. The funds are used as rehabilitation project grants to strengthen North Carolina's short-line infrastructure.


Division of Motor Vehicles 1. Closure of Thirteen Driver License Offices

The General Assembly approved a reduction in the budget for local driver license offices. Four offices have already been closed and an additional nine will be closed in December 2006. The savings represents disconnecting the data lines for the offices.


2. Customer Traffic Management System

The Governor recommended and the General Assembly approved funds to install automated queuing systems in 32 additional driver license offices. The systems allow for improved customer service and have already been installed in 27 high-volume driver license offices.



3. License Plate Recall

The Governor recommended and the General Assembly approved funds to replace old license plates that are often in poor condition and provide limited visibility to law enforcement officers. License plates were last recalled in 1990.



212

4. Driver License Mobile Units

The Governor recommended and the General Assembly approved funding to purchase two additional driver license mobile units. The mobile units provide licensing and vehicle registration services to areas where population and transaction volumes do not warrant full-time offices.



5. Online Dealer Registration

The General Assembly eliminated funding for development of an online dealer registration system.


Information Technology 1. Department of Transportation Information Technology Requests

Highway Fund appropriations were approved for the following information technology projects that have been reviewed and approved by the State CIO.

1. Server Consolidation

The Governor recommended and the General Assembly approved funds to consolidate and replace existing servers with larger-capacity servers to create an enhanced environment for server operations and management. 1,000,000

2. Microsoft Office Enterprise Agreement

The Governor recommended and the General Assembly approved funds to replace MS Office 97 with a newer version to facilitate consistency with external customers and partners. 1,500,000


Reserves and Transfers 1. Reduce Administrative Expenses

The General Assembly approved a reduction in the administration budget for the department.


2. Retirement System Contributions

The Governor recommended funds to increase the state's contribution for 2006-07 to provide a 3.7% cost-of-living adjustment to retirees of the Teachers' and State Employees' Retirement System. The General Assembly approved a 3.0% increase



213

3. Salary Increase

The Governor recommended funds to provide a 4% annual salary increase for all full-time permanent employees in the Department of Transportation and other state agencies whose positions are funded by the Highway Fund. The General Assembly approved a 5.5% annual salary increase.


4. Salary Adjustment Reserve

The Governor recommended and the General Assembly approved an increase in funds for the salary adjustment reserve for the Department of Transportation as allowed by Section 29.15 of S.L. 2005-276, as amended by Section 22.15 of SB 1741.


5. Driver Education Funding

The Governor recommended and the General Assembly approved an increase in the Highway Fund transfer to the Department of Public Instruction for driver education to allow for a projected increase in Average Daily Membership (ADM) in the ninth grade for 2006-07.


6. Leaking Underground Storage Tank Fund Reduction

The General Assembly approved a reduction to the Leaking Underground Storage Tank Fund to support a newly created Retail Motor Fuel Device Inspector position within the Department of Agriculture and Consumer Services. The funding for this program is provided by revenue generated from the gasoline inspection fee.


7. Department of Agriculture and Consumer Services

The General Assembly approved funding for the support of a newly created Retail Motor Fuel Device Inspector position. The funding for this program is provided by revenue generated from the gasoline inspection fee.


8. State Highway Patrol - New Permanent Positions

The Governor recommended and the General Assembly approved funds to establish 17 permanent positions that are currently temporary. Included are eight Tradesworker II positions, pay grade 61; eight Office Assistant IV positions, pay grade 59; and one Aircraft Mechanic position, pay grade 68. The Governor recommended funding for ten additional State Trooper positions. The General Assembly approved funding for four additional State Trooper positions.



9. State Highway Patrol - VIPER Maintenance

The Governor recommended funds to provide two additional personnel to support and maintain the Voice Interoperable Communications Plan for Emergency Responders (VIPER) infrastructure. The General Assembly approved funding to contract for the maintenance of the portion of the VIPER system currently in place.



214

10. State Highway Patrol - VIPER Network Expansion

The Governor recommended and the General Assembly approved funding for the continued development and building of the Voice Interoperable Communications Plan for Emergency Responders (VIPER).



Receipts -



Nonrecurring


Receipts -



Total Revisions for Highway Fund Budget Changes

2006-07 Recurring


Receipts -



Nonrecurring


Receipts -




215

2005-06 2006-07 Changes Per 2006-07

Appropriated Previously

Certified Senate Bill

1741 Revised Certified

Availability

Beginning Credit Balance Appropriation Reserves -$ -$ -$ -$ Highway Trust Fund Revenue 1,093,230,000 1,135,940,000 (41,010,000) 1,094,930,000 Transfer from General Fund1 - - 5,700,000 5,700,000 Total Availability 1,093,230,000$ 1,135,940,000$ (35,310,000)$ 1,100,630,000$

Expenditures and Commitments

Expended and Reserved 840,671,883 883,276,991 159,866,407 1,043,143,398 Transfer to General Fund2 252,558,117 252,663,009 (195,176,407) 57,486,602 Total Expenditures and Commitments 1,093,230,000$ 1,135,940,000$ (35,310,000)$ 1,100,630,000$

Ending Credit Balance -$ -$ -$ -$

2005-06 2006-07 Changes Per 2006-07

Appropriated Previously

Certified Senate Bill

1741 Revised Certified

Department of Transportation Maximum Allowance for Administration 41,295,740$ 42,918,720$ (1,189,780)$ 41,728,940$

Construction Allocation Intrastate System 472,112,366 496,924,658 100,567,595 597,492,253 Urban Loop System 190,902,579 200,935,637 40,665,346 241,600,983 Secondary Roads 86,825,599 90,358,988 9,271,360 99,630,348

State Aid to Municipalities 49,535,599 52,138,988 10,551,886 62,690,874

Transfer to the General Fund1 252,558,117 252,663,009 (195,176,407) 57,486,602

Total Highway Trust Fund 1,093,230,000$ 1,135,940,000$ (35,310,000)$ 1,100,630,000$

1Transfer required by G.S. 105-187.9 (includes reduction of $115 million to allow for repayment of outstanding loan balance from 2002-03).

Table 12

Condition of the Highway Trust Fund2006-07

Table 13

1Transfer being made to hold the Highway Trust Fund harmless from capping the variable component of the Motor Fuels Tax at the January 1, 2006, rate for 2006-07.2Transfer required by G.S. 105-187.9 (includes reduction of $115 million to allow for repayment of outstanding loan balance from 2002-03).

Highway Trust Fund Appropriations2006-07

Post-Legislative Budget Summary, 2006-07 TransportationHighway Trust Fund

216

Highway Trust Fund Budget Changes (84290)


2006-07Certified

2006-07 Revised

PercentageChange

Requirements $1,135,940,000 $1,100,630,000 (3.1)%

Receipts - - Appropriation $1,135,940,000 $1,100,630,000 (3.1)%

Positions - -



1. Reduce Transfer of Funds to the General Fund

The Governor recommended and the General Assembly approved a reduction to the transfer to the General Fund authorized by G.S. 105-187.9 by $115 million. This amount is the outstanding balance on the $125 million loan made from the Highway Trust Fund to the General Fund in 2002-03.


2. Reduce Transfer to the General Fund

The Governor recommended and the General Assembly approved a reduction to the transfer to the General Fund by $80 million. The $80 million transfer was implemented to recognize the growth that would have occurred in the sales tax on vehicles that was repealed when the Highway Trust Fund was created in 1989.


3. Reduction in Transfer of Funds

The Governor recommended and the General Assembly approved a reduction to the transfer to the General Fund consistent with statutory formulas to reflect revised revenue estimates for the Highway Trust Fund for 2006-07.


4. Funds for Intrastate System

The Governor recommended and the General Assembly approved an adjustment to the funds for the Intrastate System consistent with statutory formulas to reflect revised revenue estimates for the Highway Trust Fund for 2006-07 and changes in the amount transferred from the Highway Trust Fund to the General Fund.




217

5. Funds for Urban Loops

The Governor recommended and the General Assembly approved an adjustment to the funds for urban loops consistent with statutory formulas to reflect revised revenue estimates for the Highway Trust Fund for 2006-07 and changes in the amount transferred from the Highway Trust Fund to the General Fund.


6. Funds for Aid to Municipalities

The Governor recommended and the General Assembly approved an adjustment to the funds for aid to municipalities (Powell Bill) consistent with statutory formulas to reflect revised revenue estimates for the Highway Trust Fund for 2006-07 and changes in the amount transferred from the Highway Trust Fund to the General Fund.


7. Funds for Secondary Roads Construction

The Governor recommended and the General Assembly approved an adjustment to the funds for secondary roads construction consistent with statutory formulas to reflect revised revenue estimates for the Highway Trust Fund for 2006-07 and changes in the amount transferred from the Highway Trust Fund to the General Fund.


8. Funds for Program Administration

The Governor recommended and the General Assembly approved an adjustment to the funds for program administration consistent with statutory formulas to reflect revised revenue estimates for the Highway Trust Fund for 2006-07.



Receipts -

Appropriation -


Nonrecurring


Receipts -





218

Total Revisions for Highway Trust Fund Budget Changes

2006-07 Recurring

Requirements -

Receipts -

Appropriation -


Nonrecurring


Receipts -





219



General Fund

221

Capital Improvements - General Fund (19600)


2006-07Certified

2006-07Revised

PercentageChange

Requirements $0 $1,270,928,585 Receipts - 842,356,096 Appropriation $0 $428,572,489 Positions - -

Expansion 2006-07

General Government 1. Administration - Veterans Affairs Nursing Homes

The Governor recommended and the General Assembly approved capital funds for the design and construction of two 100-bed nursing homes to serve veterans in the state. One home will be sited in the eastern part of the state and one home in the west. The specific sites for these homes have not been selected. North Carolina currently has two nursing homes for veterans in Fayetteville and Salisbury. These funds provide a 35% required match to secure federal grant funding. The total cost for constructing these facilities is $24,438,096.




2. Administration - State Facilities Master Plan

The General Assembly approved capital planning funds for the development of a new facilities master plan for state government operations in Wake County. To the extent that funds are available, the scope of the master plan may be extended to operations outside of Wake County.


3. Cultural Resources - North Carolina History Education Center

The General Assembly approved capital planning funds to design the History Education Center at Tryon Palace Historic Sites and Gardens. The total projected cost for this project is $31,881,525.


Post-Legislative Budget Summary, 2006-07 General FundCapital Improvements

223

Natural and Economic Resources 1. Agriculture - Rollins Laboratory-Bio-Security Level 2 Conversion

The General Assembly approved $250,000 to convert a chemistry lab in Rollins Laboratory into a Bio-Security Level 2 lab. This conversion will allow Rollins Laboratory to securely handle certain infectious diseases affecting animals.


2. Agriculture - Oxford Complex Planning and Design

The Governor recommended and the General Assembly approved capital planning funds for property acquisition and necessary capital improvements to establish a new laboratory in Oxford. The U.S. Department of Agriculture has proposed conveying a tobacco research facility to the state for the purpose of establishing the lab. The future purpose of the facility would be to develop a public research laboratory, potentially for avian flu research. The Department of Agriculture and Consumer Services will also explore the potential for establishing a biotechnology incubator at this lab facility. The proposed facility would also provide a permanent home for the state's insect laboratory, currently located in Cary.


3. Agriculture - Tidewater Research Station Improvements

The General Assembly approved capital funds from timber receipts for land acquisition and capital improvements at the Tidewater Research Station.



Appropriation - Nonrecurring -

4. Agriculture - Plant Conservation Program

The General Assembly approved capital funds from timber receipts for land acquisitions and related activities for the Plant Conservation Program. Authorized uses also include a study of the program's management of conservation preserves. The legislature authorized $30,000 in timber receipts for this purpose.




5. Agriculture - Senator Bob Martin Eastern Agricultural Center Improvements

The General Assembly approved capital funds from timber receipts for planning and capital improvements at the Eastern Agricultural Center.


224

6. North Carolina Ports Authority - Container Cranes

The Governor recommended and the General Assembly approved $7,500,000 in capital funds for the purchase of four container cranes for the Port of Wilmington. The General Assembly appropriated $9 million to the Ports Authority in FY 2005-06, of which $6,648,000 was used for a down payment on the four cranes. The Ports Authority anticipates crane delivery in December 2006. The total cost for the project is $33,244,000, and the balance will be covered by revenue bonds issued by the Ports Authority.




7. DENR - Water Resources Development Projects

The Governor recommended $18,500,000 and the General Assembly approved $20,000,000 for the state share of civil works projects for navigation, flood control, drainage, and beach protection. The costs for these projects are shared by statutory formula with the federal and/or local governments. Projects are specified in S.L.2006-66 Section 23.3(a).




8. DENR - Hickory Nut Gorge Expansion

The Governor recommended and the General Assembly approved capital funds for land acquisitions and necessary improvements to expand the Chimney Rock tract of Hickory Nut Gorge State Park. The total planned expansion is 2,000 acres at a total cost of $30 million. DENR proposes funding the remaining land acquisitions with Clean Water Management Trust Fund, Natural Heritage Trust Fund, and Parks and Recreation Trust Fund monies.


9. DENR - Zoo - Exhibit Storage Shed

The Governor recommended and the General Assembly approved capital funds for the construction of a 17,000 square foot steel storage shed to store supplies, equipment, and construction materials that are currently stored in the open. The shed will also secure equipment and materials from theft.


10. DENR - Forest Resources District 9 Headquarters Complex

The Governor recommended and the General Assembly approved capital funds for the design and construction of office, workshop, storage, and refrigerated facilities in Sylva.


Justice and Public Safety 1. Crime Control and Public Safety - Emergency Management Operations Center

The Governor recommended and the General Assembly approved capital funds for the design and construction of a new Emergency Operations Center (EOC) that will be located in the lower level of the proposed National Guard Readiness Center. The Readiness Center received federal funds in federal FY 2005-06 for planning and design. The National Guard expects to secure federal construction grants in federal FY 2006-07 to complete the $30


225

million project. The Emergency Operations Center will consolidate most Raleigh-based Division of Emergency Management personnel in one building.


2. Crime Control and Public Safety - Marion Transportation Center Motor Fleet Lot

The Governor recommended and the General Assembly approved capital funds to perform site preparation and expand the parking lot to house the Marion Transportation Center's full fleet of trucks. Currently, the center stores part of its motor fleet at a Department of Correction facility. The National Guard will soon lose access to the Department of Correction's property.


University of North Carolina System 1. Appalachian State University - College of Education Building

The General Assembly approved capital planning funds for the proposed construction of the College of Education Living Learning Academic Building. Total projected cost for the facility is $35,000,000.


2. Fayetteville State University - Science and Technology Complex

The General Assembly approved capital planning funds for the proposed science and technology complex, which will include laboratory, instruction, research, and office space. The total projected cost for the complex is $22,000,000.


3. NC A&T - General Classroom Facility

The General Assembly approved capital planning funds for the proposed general classroom/instructional facility. Total projected cost for the facility is $20,000,000.


4. NC School of the Arts - Library

The General Assembly approved capital planning funds for the proposed new library. The total projected cost for the facility is $24,200,000.


5. NCSU - Engineering Complex III

The Governor recommended and the General Assembly approved capital funds for the design and construction of the third phase of relocating the School of Engineering to Centennial Campus. The 166,700 square-foot facility will house the Departments of Mechanical and Aerospace Engineering and Biomedical Engineering. Total cost for this project is $69.7 million. The General Assembly appropriated $8.7 million to this project in FY 2005-06.


6. UNC-Chapel Hill - Genomics Science Building

The General Assembly approved capital funds for planning and site preparation for a Genomics Science Building in the Science Complex South. The 210,000 square foot facility has an estimated total cost of $145,000,000.



226

7. UNC Hospitals at Chapel Hill - Master Facilities Plan

The General Assembly approved capital funds for UNC Hospitals and the UNC School of Medicine to develop a comprehensive master plan.


8. UNC-Greensboro - Academic Classroom and Office Building

The General Assembly approved capital planning funds for the proposed new general classroom and office building. Total projected cost for the facility is $43,827,470.


9. UNC-Pembroke - Residence Hall

The General Assembly approved capital planning funds for a proposed 360-bed residence hall. The projected cost for the facility is $20,000,000.


10. UNC-Wilmington - School of Nursing

The Governor recommended and the General Assembly approved capital funds for the design and construction of an 80,000 square foot building for the School of Nursing. The General Assembly appropriated $500,000 in FY 2004-05 and $2,600,000 in FY 2005-06 for planning.


11. Western Carolina University - School of Health/Gerontology Building

The General Assembly approved capital planning funds for the School of Health and Gerontological Science building at WCU. The total projected cost for this project is $46,200,000.


12. Winston-Salem State University - Student Activity Center

The General Assembly approved capital planning funds for a proposed new student activities center. Total projected cost for this facility is $14,773,560. The amount of receipts available to offset the cost of construction is not known at this time.


13. Dental School Planning

The General Assembly approved capital planning funds for the expansion of the School of Dentistry at UNC-Chapel Hill and the establishment of a School of Dentistry at East Carolina University.


14. Reserve for Capital Cost Overruns

The General Assembly approved reserve funds for capital projects in the UNC System that lack sufficient available funds to award a construction contract. Priority shall be given to Focus Growth institutions.



227

Repair and Renovation Reserve The Governor recommended $200,000,000 and the General Assembly authorized $222,229,189 for the FY 2006-07 Repair and Renovation Reserve Account.

1. OSBM - Repair and Renovations Reserve

Of the funds in the Repair and Renovations Reserve, the Governor recommended $108,000,000 and the General Assembly authorized $120,003,762 (54%) be allocated to the Office of State Budget and Management for repairs and renovations pursuant to G.S.143-15.


2. UNC Board of Governors Repair and Renovations Reserve

Of the funds in the Repair and Renovations Reserve, the Governor recommended $92,000,000 and the General Assembly authorized $102,225,427 (46%) be allocated to the UNC Board of Governors for repairs and renovations pursuant to G.S.143-15.


State Facilities Financed with Special Indebtedness (COPs), Session Law 2006-66 1. Cultural Resources - NC Museum of Art Expansion

The Governor recommended $40,000,000 in capital appropriations and the General Assembly authorized the issuance of certificates of participation to complete the planning and construction of a 126,000 square foot expansion of the NC Museum of Art in Raleigh. The expansion will increase exhibit space and visitor services. The total cost of the expansion is $67 million. The legislature appropriated $2.2 million in FY 2004-05 and $10 million in FY 2005-06. The City of Raleigh and Wake County have jointly committed $15 million towards the expansion. The expansion will house the Auguste Rodin gift from the Iris and B. Gerald Cantor Foundation. The total debt authorized is $40,000,000.




2. DHHS - Public Health Laboratory/Office of Chief Medical Examiner

The Governor recommended and the General Assembly authorized the issuance of certificates of participation to complete the planning and construction of a 205,000 square foot facility to house the State Public Health Laboratory and Office of Chief Medical Examiner. The new facility will be located in Raleigh. The total debt authorized is $101,000,000.





228

3. DHHS - Central Regional Psychiatric Hospital

The General Assembly authorized an additional $20,000,000 in certificates of participation to complete construction of the Central Regional Psychiatric Hospital in Butner. Proceeds will fund the purchase and installation of information technology infrastructure as well as other construction needs to finish the project. The General Assembly authorized $110,000,000 in certificates of participation in S.L. 2003-314 for this facility.




4. DHHS - Eastern Regional Psychiatric Hospital

The General Assembly authorized the issuance of certificates of participation for the planning and construction of a 304-bed psychiatric hospital to replace Cherry Hospital in Goldsboro. The debt, totaling $145,500,000, is authorized in installments over three separate fiscal years.




5. DHHS - Western Regional Psychiatric Hospital

The General Assembly authorized the issuance of certificates of participation for the planning and construction of a 382-bed psychiatric hospital to replace Broughton Hospital in Morganton. The debt, totaling $162,800,000, is authorized in installments over two separate fiscal years. The first installment of $20,000,000 is not authorized until July 1, 2008.




6. Correction - Regional Medical Center and Mental Health Center

The Governor recommended and the General Assembly authorized the issuance of certificates of participation for the planning and construction of a new 120-bed Regional Medical Center and a 200-bed Mental Health Center to serve prisoners in the state prison system. The facilities will be located at Central Prison in Raleigh. Total projected cost for the construction of the medical and mental health centers is $151,864,137. The Department of Correction anticipates $7,864,137 in receipts to devote to this capital project. An additional amount of $11,800,000 in 2006 repair and renovation funds is dedicated for site development activities. The debt, totaling $132,200,000, is authorized in installments over four fiscal years.




7. Information Technology Services - Secondary Statewide Data Center

The Governor recommended $24,841,300 in capital appropriations and the General Assembly authorized the issuance of certificates of participation for land acquisition,


229

planning, and construction of a 45,000 square foot data center in Rutherford County. The center will provide data recovery services for state agencies in times of disaster. The center will also provide additional capacity for IT operations across state agencies. ITS currently contracts for disaster recovery services. The total debt authorized is $24,841,300.




8. UNC-Charlotte - Center City Classroom Building

The Governor recommended $45,827,400 in capital appropriations and the General Assembly authorized the issuance of certificates of participation for the planning and construction of a 150,000 square foot classroom building to house graduate and professional programs. Belk College of Business, the College of Architecture, and Lee College of Engineering will move to this uptown facility. The total debt authorized is $45,827,400.




State Facilities Financed with Special Indebtedness (COPs), Session Law 2006-231 1. Administration - New Parking Deck

The Governor recommended and the General Assembly authorized the issuance of special indebtedness to finance the costs of a new parking deck to be constructed in downtown Raleigh.




2. Juvenile Justice - Five Youth Development Centers - Supplement

The General Assembly amended S.L.2004-179 to increase the authorization of special indebtedness from $35,000,000 to $42,000,000, effective January 1, 2007, in order to construct up to five youth development centers totaling up to 224 beds.





230

3. Wildlife Resources Commission - State Game Land Acquisition

The General Assembly authorized the issuance of special indebtedness to finance the costs of purchasing land to be administered by the Wildlife Resources Commission as state game lands.





Receipts -

Appropriation -


Nonrecurring

Requirements $1,270,928,585




Total Revisions for Capital Improvements - General Fund

2006-07 Recurring

Requirements -

Receipts -

Appropriation -


Nonrecurring

Requirements $1,270,928,585





231



Non-General Fund

233

Capital Improvements - Non-General Fund (404xx)

Expansion 2006-07

Appalachian State University 1. Central Dining Facility - Phase II Requirements - Nonrecurring $4,850,000

Less Self-Liquidating Sources $4,850,000

Appropriation -

East Carolina University 1. Mendenhall Student Center and Ledonia Wright Cultural Center - Expansion and Renovation Requirements - Nonrecurring $39,000,000


Appropriation -

2. Todd Dining Hall - Renovation Requirements - Nonrecurring $2,100,000


Appropriation -

3. Brody School of Medicine - Renovations Requirements - Nonrecurring $1,200,000


Appropriation -

Post-Legislative Budget Summary, 2006-07 Non-General FundCapital Improvements

235

4. Brody School of Medicine - Health Science Campus Requirements - Nonrecurring $6,000,000


Appropriation -

Elizabeth City State University 1. Residence Hall - Heating, Ventilating, and Air Conditioning Improvements Requirements - Nonrecurring $1,500,000


Appropriation -

North Carolina State University 1. Derr Track - Renovation and Expansion - Phase II Requirements - Nonrecurring $2,500,000


Appropriation -

2. Partners VI Building and Parking Deck Requirements - Nonrecurring $40,000,000


Appropriation -

3. Centennial Campus Infrastructure Requirements - Nonrecurring $10,000,000


Appropriation -


236

4. Residence Halls - Renovation - Supplement Requirements - Nonrecurring $11,500,000


Appropriation -

5. Thompson Theater - Renovation and Expansion - Supplement Requirements - Nonrecurring $4,500,000


Appropriation -

University of North Carolina at Chapel Hill 1. Food Services Facilities - Renovation and Expansion Requirements - Nonrecurring $3,500,000


Appropriation -

2. Research Resource Facility - Phase II Requirements - Nonrecurring $12,400,000


Appropriation -

3. Science Complex - Phase II Requirements - Nonrecurring $92,200,000


Appropriation -

4. Carmichael Auditorium - Renovation and Expansion Requirements - Nonrecurring $15,000,000


Appropriation -


237

5. Residence Halls - Improvements Requirements - Nonrecurring $2,000,000


Appropriation -

6. Woollen Gymnasium - Renovation Requirements - Nonrecurring $4,500,000


Appropriation -

7. Boshamer Baseball Stadium - Improvements Requirements - Nonrecurring $14,000,000


Appropriation -

8. Cogeneration Warehouse Requirements - Nonrecurring $500,000

Less Self-Liquidating Sources $500,000

Appropriation -

9. Steam Infrastructure Improvements Requirements - Nonrecurring $55,700,000


Appropriation -

10. Electrical Infrastructure Improvements Requirements - Nonrecurring $29,530,000


Appropriation -


238

11. Bell Tower Development - Phase I Requirements - Nonrecurring $10,000,000


Appropriation -

12. Global Education and International Studies Center - Improvements Requirements - Nonrecurring $2,500,000


Appropriation -

13. Residence Halls - Improvements - Supplement Requirements - Nonrecurring $2,500,000


Appropriation -

14. Botanical Garden Visitor Education Center - Supplement Requirements - Nonrecurring $5,000,000


Appropriation -

15. Education Foundation Office Building - Supplement Requirements - Nonrecurring $12,000,000


Appropriation -

16. Cobb Residence Hall - Renovation - Supplement Requirements - Nonrecurring $5,116,000


Appropriation -


239

17. Residence College - Phase II - Supplement Requirements - Nonrecurring $8,000,000


Appropriation -

18. Rizzo Center - Expansion - Supplement Requirements - Nonrecurring $5,300,000


Appropriation -

University of North Carolina at Charlotte 1. Prospector Hall - Renovation - Phase II Requirements - Nonrecurring $4,000,000


Appropriation -

2. Residence Halls - Phase IX Requirements - Nonrecurring $38,800,000


Appropriation -

3. Student Union - Supplement Requirements - Nonrecurring $10,000,000


Appropriation -


240

University of North Carolina at Greensboro 1. Residence Hall Acquisition Requirements - Nonrecurring $29,500,000


Appropriation -

2. Parking Deck Addition Supplement Requirements - Nonrecurring $1,000,000


Appropriation -

University of North Carolina at Pembroke 1. University Center Expansion - Supplement Requirements - Nonrecurring $2,000,000


Appropriation -

University of North Carolina at Wilmington 1. Residence Halls - Improvements Requirements - Nonrecurring $4,900,000


Appropriation -

2. University Union Building - Expansion and Renovation - Supplement Requirements - Nonrecurring $12,000,000


Appropriation -


241

Western Carolina University 1. Residence Hall - Renovation and Expansion Requirements - Nonrecurring $1,000,000


Appropriation -

2. Dodson Cafeteria Replacement - Supplement Requirements - Nonrecurring $12,250,000


Appropriation -

3. New Student Recreation Center - Supplement Requirements - Nonrecurring $6,200,000


Appropriation -

Winston-Salem State University 1. Residence Hall - Renovation Requirements - Nonrecurring $4,500,000


Appropriation -


242


Reserves, Debt Service, and Other Adjustments

General Fund

243

Reserves, Debt Service, and Other Adjustments - General Fund (190xx)


2006-07Certified

2006-07 Revised

PercentageChange

Requirements $1,214,742,725 $1,998,470,056 64.5 %

Receipts 64,500,000 64,500,000 0.0 %

Appropriation $1,150,242,725 $1,933,970,056 68.1 %

Positions - 56.750


Debt Service 1. Adjust Debt Service Requirements

Reduces General Fund appropriations for debt service due to revised cash flow requirements as well as updated estimates for principal and interest payments.



Receipts -

Appropriation -


Nonrecurring


Receipts -



Post-Legislative Budget Summary, 2006-07 General FundReserves, Debt Service, and Other Adjustments

245

Expansion 2006-07

Employee Benefits 1. State-Funded Employee Compensation Increases

Provides funds to support salary increases for employees of state agencies, departments and universities, community college institutions, and public schools. Public School Salary Increases - includes certified teaching, school-based administrators, and noncertified personnel in local public schools, state agency-based public schools, and the N.C. School of Science and Math.

1. Teachers and Instructional Support - Provides funds to support an experience-based step increase for teachers and instructional support personnel (average salary increase of 1.86%) and a flat annual increase in the teacher salary schedule of $2,250 for fiscal year 2006-07 (total average increase of 8%.)

2. Principals and Assistant Principals - Provides funds to support an experience-based step increase for school-based administrators (average salary increase of 1.75%) and a flat annual increase in the school-based administrator salary schedule of $2,250 for fiscal year 2006-07 (total average increase of 7%). School-based administrators who are at the top of the experience-based salary schedule will receive a one-time lump-sum bonus equivalent to 2%.

3. All Other Public School Personnel - Provides funds to support a 5.5% annual salary increase.

Community College Salary Increases

1. Faculty and Professional Staff - Provides funds to support a 6% annual salary increase and a 2% one-time bonus for full-time permanent community college faculty and professional staff.

2. All Other Community College Personnel - Provides funds to support a 5.5% annual salary increase.

University Salary Increases

1. EPA Faculty and EPA Non-Faculty - Provides funds to support a 6% annual salary increase for full-time permanent EPA faculty and EPA non-faculty.

2. All Other University Personnel - Provides funds to support a 5.5% annual salary increase.

State Agency/Department Salary Increases - Provides funds to support a 5.5% annual salary increase for full-time permanent employees of agencies and departments.




246

2. Additional Step to Public School Teacher Salary Schedule

Adds a 30+ step to the public school teacher salary schedule. The 30+ step is 2% higher than the current 29+ step.


3. Fair Minimum Wage for Noncertified Public School Employees

Provides funds to support a minimum salary of at least $20,112 for all permanent, full-time, noncertified public school employees and to support proportionate increases to permanent full-time employees working schedules requiring less than 12 months' service per year.


4. University of North Carolina Faculty Recruiting and Retention Fund

Establishes a Faculty Recruiting and Retention Fund under the Office of the President of the University of North Carolina system to be used, at the discretion of the president, for salary increases for the purpose of recruiting and retaining faculty members as necessary at constituent institutions.


5. Retirement System Contribution - COLA for Retirees

Increases the state's contribution for fiscal year 2006-07 to provide a 3% cost-of-living adjustment for retirees of the Teachers' and State Employees' Retirement System. This adjustment is funded in part with actuarial gains within the retirement system.


6. Retirement System Payback

Provides funds to continue the repayment of funds withheld from the Retirement System in fiscal year 2000-01 due to the budget crisis. This is the fourth installment of the five-year payback period.


Information Technology 1. BEACON - HR/Payroll System Replacement

Funds were provided in 2005-06 to begin replacing the state's aging personnel and payroll systems. This appropriation supports phase one of the project, which includes funds for system integration, staff training, software maintenance, and ITS data charges.




2. Information Technology Attorney Positions

Provides funds to establish two attorney positions to assist with complex information technology procurements.




247

Statewide Reserves 1. Establish State Emergency Response Account

Provides funds for the State Emergency Response Account, a new reserve in the General Fund. Funds may be used for disaster preparation and response programs in accordance with G.S. 166A-6.02.


2. Reserve for Legal Expenses

Provides funds to pay legal expenses of the state, when in accordance with G.S. 147-17, the Attorney General advises the Governor that it is impracticable for the office to provide legal services, for litigation requiring specialized expertise, or where a conflict of interest prevents the Attorney General's office from representing the state.


3. Reserve for Heating and Cooling Assistance

Provides funds to assist needy families with heating and cooling bills associated with higher utility and fuel costs.


4. Pending Ethics Legislation Provides funds to implement House Bill 1843 and House Bill 1844. Appropriation $537,673



Trust Funds 1. MH/DD/SAS Trust Fund

Provides funds to the trust fund for mental health, developmental disabilities, and substance abuse services for bridge funding needs as outlined in G.S. 143-15-3D.



Receipts -




248

Nonrecurring


Receipts -



Total Revisions for Reserves, Debt Service, and Other Adjustments -

General Fund 2006-07

Recurring


Receipts -



Nonrecurring


Receipts -




249

Appendix

251

Post-Legislative Budget Summary, 2006-07 AppendixTable 1A

Table 1ACondition of the General Fund, 1974-75 to 2005-06

(Includes Federal Revenue Sharing and Anti-Recession Revenues)

Beginning Transfers Total EndingFiscal Balance from Net Appropriation Reserve BalanceYear July 1 Reserves Collections Expenditures Transfersa June 30

1974-75 108,532,052$ -$ 1,597,146,807$ 1,721,068,968$ -$ 56,609,891$ 1975-76 56,609,891 - 1,710,532,207 1,698,673,699 - 68,468,399 1976-77 68,468,399 - 2,018,349,566 1,935,935,992 - 150,882,006 1977-78 150,882,006 - 2,196,552,943 2,162,483,376 - 184,951,573 1978-79 184,951,573 - 2,486,968,295 2,484,341,660 - 187,578,208 1979-80 187,578,208 - 2,842,041,456 2,744,651,008 - 284,968,657 1980-81 284,968,657 - 3,023,812,433 3,154,154,198 - 154,626,892 1981-82 154,626,892 - 3,229,540,752 3,275,619,875 - 108,547,769 1982-83 108,547,769 - 3,405,116,476 3,440,694,342 - 72,969,903 1983-84 72,969,903 - 3,957,447,438 3,775,487,080 - 254,930,261 1984-85 254,930,261 - 4,527,147,566 4,401,980,073 - 380,097,754 1985-86 380,097,754 - 4,910,870,016 4,971,858,475 - 319,109,295 b

1986-87 319,109,295 - 5,392,076,697 5,349,003,039 - 362,182,953 1987-88 362,182,953 - 5,804,527,342 5,773,774,887 - 392,935,408 1988-89 392,935,408 - 6,154,529,607 6,409,558,219 - 157,048,576 1989-90 157,048,576 - 6,988,406,667 6,923,212,860 - 222,242,383 1990-91 222,242,383 - 7,207,815,194 7,429,617,079 - 440,498 1991-92 440,498 - 7,817,050,946 7,652,318,443 c 41,593,253 123,579,748 1992-93 123,579,748 - 8,292,796,568 7,879,046,057 191,332,565 345,997,694 1993-94 345,997,694 178,000,000 9,102,334,828 9,003,619,540 215,678,246 407,034,736 1994-95 407,034,736 269,932,954 d 9,970,738,717 9,967,684,132 387,411,138 292,611,137 1995-96 292,611,137 153,100,000 e 10,090,225,385 9,809,354,769 320,445,592 f 406,136,161 1996-97 406,136,131 1,595,394 g 10,933,860,552 10,466,775,861 556,126,043 h 318,690,202 1997-98 318,690,202 174,544,955 11,727,128,530 11,436,138,797 268,994,402 515,230,488 1998-99 515,230,488 227,844,930 12,753,272,488 12,961,718,694 237,927,186 296,702,026 1999-00 296,702,026 722,299,954 13,136,080,241 13,853,708,453 301,373,769 (0) i

2000-01 (0) i 620,729,850 j 13,451,860,973 13,445,510,386 627,080,436 0 i

2001-02 0 i 703,038,110 k 13,157,882,906 13,741,135,020 116,000,000 3,785,996 2002-03 25,000,000 l 136,859,298 14,110,717,770 13,855,522,493 166,510,735 250,543,840 2003-04 250,543,840 245,656,143 14,690,826,574 14,704,184,520 193,463,425 289,378,612 2004-05 289,378,612 0 16,326,481,563 15,798,359,545 338,991,684 478,508,946 2005-06 478,508,946 0 17,874,348,531 17,065,090,604 538,380,820 749,386,052

a. Reserve transfers for Savings Reserve, Repair and Renovations Reserve, Reserve for Tax Relief, and other.b. Includes a reserve of $28,600,000 required by the June 1986 General Assembly Session in accordance with the 1985 Session Laws, Chapter 791, Section 44.c. This number excludes $400,000 transferred to the Savings Reserve account for 1991-92 as appropriated.d. This number includes $209,932,954 for the Reserve for Disproportionate Share and $60,000,000 for Repairs and Renovations.e. This number includes $28,100,000 for the Reserve for Tax Relief and $125,000,000 authorized for Repairs and Renovations.f. The number includes $130 million for Repair and Renovations, $77,342,025.97 Savings Reserve, $25 million Federal Retiree Refund, $1.2 million Federal Retiree Refund Administration, $47.1 million Clean Water Management, $39,519,567 capital improvements, and $284,000 library grants.g. Reserve for Disproportionate Share.h. This number includes $115,510,195 for Disaster Relief, $174,260,955 for Repair and Renovations, $49,354,893.26 for Clean Water Management, $156 million for Intangible Tax Refunds, and $61 million for the Railroad Purchase Reserve.i. Zero in parentheses represents a negative value that rounds to zero. Zero without parentheses represents a positive value that rounds to zero.j. This number includes $308,401,820 for the Easley Executive Order #3 Reserve and $312,328,030 Disaster Relief Reserve.k. This number includes $440,915,625 for the EEO #19 Reserve, $347,763,108 Shortfall BC 19979, $4,359,377 capital improvement transfers, and ($90,000,000) authorized transfer to Savings Reserve from Revenues.l. Section 2.2.(a) of Session Law 2002-126 established a beginning unreserved credit balance of $25 million.

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Post-Legislative Budget Summary, 2006-07 AppendixTable 1B

Table 1BCondition of the Highway Fund, 1974-75 to 2005-06

(Includes Federal Aid Participation)

Beginning Total EndingFiscal Balance Net Appropriation BalanceYear July 1 Collectionsa Expenditures June 30

1974-75 110,948,079$ 672,255,228$ 628,849,033$ 154,354,274$ 1975-76 154,354,274 493,536,624 550,259,908 97,630,990 1976-77 97,630,990 692,175,363 623,935,040 165,871,313 1977-78 165,871,313 613,161,176 676,460,378 102,572,111 1978-79 102,572,111 698,424,160 681,582,831 119,413,440 1979-80 119,413,440 688,864,174 696,345,679 111,931,935 1980-81 111,931,935 666,935,631 612,035,936 166,831,612 1981-82 166,831,612 729,968,258 674,034,180 222,765,690 1982-83 222,765,690 862,394,389 762,384,819 322,775,260 1983-84 322,775,260 918,012,956 945,996,357 294,791,859 1984-85 294,791,859 1,053,678,404 1,041,253,080 307,217,183 1985-86 307,217,183 1,016,891,045 1,031,831,352 292,276,879 1986-87 292,276,879 1,190,806,504 1,169,873,310 313,210,073 1987-88 313,210,073 1,232,282,636 1,222,631,851 322,860,858 1988-89 322,860,858 1,409,839,386 1,315,847,645 416,852,599 1989-90 416,852,599 1,232,848,473 1,345,684,467 304,016,605 1990-91 304,016,605 1,399,958,822 1,351,535,540 352,439,887 1991-92 352,439,887 1,605,877,793 1,528,101,820 430,215,860 1992-93 430,215,860 1,697,651,523 1,770,759,812 357,107,571 1993-94 357,107,571 1,752,701,588 1,747,469,878 362,339,281 1994-95 362,339,281 1,619,505,085 1,748,159,076 233,685,290 1995-96 233,685,290 1,851,464,315 1,773,223,724 311,925,881 1996-97 311,925,881 2,310,485,801 2,429,520,589 192,891,093 1997-98 192,891,093 2,206,983,140 2,099,049,223 300,825,010 1998-99 300,825,010 2,301,524,041 2,142,510,030 459,839,021 1999-00 459,839,021 2,458,253,201 2,467,131,526 450,960,697 2000-01 450,960,697 2,535,313,224 2,452,760,524 533,513,397 2001-02 533,513,397 2,684,784,992 2,722,939,943 495,358,446 2002-03 495,358,446 3,905,749,064 2,736,727,380 1,664,380,130 2003-04 1,664,380,130 3,437,047,830 2,374,362,841 2,727,065,119 2004-05 2,727,065,119 2,817,543,977 2,615,335,066 2,929,274,030 2005-06 2,929,274,030 2,931,337,147 2,314,562,645 3,546,048,532

a. Includes local aid participation and interfund transfers.

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Post-Legislative Budget Summary, 2006-07 AppendixTable 1C

Table 1CCondition of the Highway Trust Fund, 1989-90 to 2005-06

ContractingTotal Authorization

Beginning Revenue from Total Ending Fiscal Balance and Other Future Years Appropriation BalanceYear July 1 Sources Cash Flow Expendituresa June 30

1989-90 -$ 243,893,008$ -$ 204,692,423$ 39,200,585$ 1990-91 39,200,585 286,946,282 137,223,500 434,021,519 29,348,848 1991-92 29,348,848 537,809,797 (79,055,757) 428,739,384 59,363,504 1992-93 59,363,504 574,157,887 (37,617,743) 501,440,081 94,463,567 1993-94 94,463,567 645,111,384 45,600,000 648,731,304 136,443,647 1994-95 136,443,647 689,536,522 50,150,000 771,874,365 104,255,804 1995-96 104,255,804 813,462,828 45,800,000 718,955,090 152,963,542 1996-97 152,963,542 1,011,488,313 119,185,000 943,081,732 102,185,123 1997-98 102,185,123 935,138,876 62,740,759 828,875,931 145,707,309 1998-99 145,707,309 803,338,157 30,421,905 760,821,140 218,646,231 1999-00 218,646,231 936,444,582 (38,513,690) 895,301,189 221,275,934 2000-01 221,275,934 968,998,273 (26,981,351) 841,958,656 321,334,200 2001-02 321,334,200 1,194,186,165 86,323,105 1,186,268,479 415,574,991 2002-03 415,574,991 1,150,573,168 5,995,280 1,221,468,357 350,675,082 2003-04 350,675,082 1,473,132,995 79,302,827 1,737,991,663 165,119,241 2004-05 165,119,241 1,475,311,921 145,551,538 1,905,874,013 (119,891,313) 2005-06 (119,891,313) 837,522,911 (217,758,541) 897,601,023 (397,727,966)

a. Expenditures include all interfund transfers for both the Highway and General Funds.

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Post-Legislative Budget Summary, 2006-07 AppendixTable 1D

Table 1DSchedule of the Savings Reserve Account Balance, 1990-91 to 2005-06

Beginning Authorized EndingFiscal Balance Authorized Reserve for BalanceYear July 1 Transfer Current Year June 30

1990-91 141,000,000$ (141,000,000)$ a -$ -$ 1991-92 400,000 - 41,193,253 41,593,253 1992-93 41,593,253 - 134,332,565 175,925,818 1993-94 175,925,818 (121,000,000) b 155,678,246 210,604,064 1994-95 210,604,064 146,305,569 66,700,000 c 423,609,633 1995-96 423,609,633 - 77,342,026 500,951,659 1996-97 500,951,659 - - 500,951,659 1997-98 500,951,659 - 21,568,903 522,520,562 1998-99 522,520,562 - - d 522,520,562 1999-00 522,520,562 (485,965,824) e 967,311 37,522,049 2000-01 37,522,049 - 120,000,000 f 157,522,048 2001-02 157,522,048 (247,522,048) 90,000,000 g - 2002-03 - - 150,000,000 150,000,000 2003-04 150,000,000 391,343 116,666,064 267,057,407 2004-05 267,057,407 (153,541,447) h 199,125,000 312,640,960 2005-06 312,640,960 - 316,151,631 628,792,591

a. The General Assembly appropriated $141.0 million; the reserve was used to balance a revenue shortfall in 1990-91.b. The 1993 Session of the General Assembly authorized the transfer of reserves to support the appropriation for the June 30 payroll restoration.c. The 1993 Session of the General Assembly (1994 Regular Session) appropriated $66.7 million to the reserve.d. The 1999 Session of the General Assembly fixed the balance of the reserve for 1998-99 only at the previous year's level. e. The 1999 Session of the General Assembly authorized the use of the Savings Reserve account to pay the first installment of the intangibles tax liability. The December 1999 Special Session of the General Assembly authorized the transfer of $285,965,824 to provide funds for the Hurricane Floyd Reserve.f. The 2000 Short Session of the General Assembly appropriated $120 million to the reserve.g. The 2001 Session of the General Assembly directed the State Controller to "credit" the Savings Reserve account with $181.8 million from the General Fund, but only $90 million was credited.h. Amount transferred to the Disaster Relief Reserve for the 2004 hurricane season recovery, per Senate Bill 7.

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Post-Legislative Budget Summary, 2006-07 AppendixTable 2

Table 2Total Authorized North Carolina State Budget, 1984-85 to 2006-07

(In Millions)

Local TaxFiscal Capital Reimbursements BudgetYear Operating Improvements and Other Stabilization Total

1984-85 7,203.6 234.1 - - 7,437.7 1985-86 8,102.5 298.0 - - 8,400.5 1986-87 8,622.3 a 334.1 a - - 8,956.4 1987-88 9,467.1 257.1 - - 9,724.2 1988-89 10,093.5 316.9 - - 10,410.4 1989-90 11,387.1 377.6 231.7 - 11,996.4 1990-91 12,027.2 294.6 b 476.8 141.0 12,939.6 1991-92 12,892.7 242.6 c 474.6 0.4 13,610.3 1992-93 13,997.3 274.6 236.8 - 14,508.7 1993-94 16,130.8 d 374.0 e 236.8 - 16,741.6 1994-95 17,320.5 d 412.6 236.8 - 17,969.9 1995-96 17,600.6 456.0 - - 18,056.6 1996-97 f 18,662.2 1,118.0 - - 19,780.2 1997-98 g 19,923.4 1,201.4 - - 21,124.8 1998-99 g 21,300.7 883.5 447.4 - 22,631.6 1999-00 h 22,784.3 877.1 629.0 - 24,290.4 2000-01 i 23,927.7 424.0 30.0 l 120.0 24,501.7 2001-02 j 25,763.0 762.9 40.0 l - 26,565.9 2002-03 k 26,205.0 881.2 66.5 l - 27,152.7 2003-04 27,801.7 1,533.3 62.0 l - 29,397.0 2004-05 29,625.4 1,534.1 62.0 l - 31,221.5 2005-06 33,195.9 1,243.7 100.0 l - 34,539.6 2006-07 35,344.9 1,316.1 100.0 l - 36,761.0

a. Includes emergency appropriation for the Department of Correction.b. Includes $75 million from legislative bonds.c. Includes $45 million from legislative bonds and $112.5 million from prison bonds.d. Includes $214.2 million for June 1994 payroll restoration (1993-94) and $120 million for teacher payroll restoration (1994-95).e. Includes $87.5 million from prison bonds.f. Includes $4.7 million for community colleges from the 1997 Session of the General Assembly.g. Includes public school bonds and highway bonds ($700.0 million in 1997-98 and $450.0 million in 1998-99).h. Includes $450 million for public school bonds in 1999-00 and $200 million for clean water and natural gas bonds.i. Includes $300 million for clean water and natural gas bonds.j. Includes $250 million for clean water and natural gas bonds, $55 million for public school bonds, and $300 million for university and community college bonds.k. Includes $250 million for clean water and natural gas bonds and $600 million for university and community college bonds.l. Clean Water Management Trust Fund appropriation.

257


Table 3ATotal North Carolina State Budget by Function, Department, and Source of Funds, 2006-07

General Highway FundBudget General and HighwayCode Function Fund Trust Fund Other Federal Total

Education13510 Public Education 6,719,751,118$ 32,517,171$ 14,692,445$ 887,957,922$ 7,654,918,656$ 16800 Community Colleges 831,455,913 - 184,398,645 16,271,397 1,032,125,955 160xx University System16010 UNC General Administration 46,906,173 - 18,000 - 46,924,173 16011 UNC Institutional Programs 283,704,874 - 25,697,333 - 309,402,207 16012 UNC Related Education Programs 111,882,369 - - 1,778,477 113,660,846 16020 UNC at Chapel Hill Academic Affairs 210,315,080 - 155,788,164 246,671 366,349,915 16021 UNC at Chapel Hill Health Affairs 163,914,060 - 36,337,758 - 200,251,818 16022 UNC at Chapel Hill Area Health Education 44,743,422 - - - 44,743,422 16030 NC State Univ. Academic 291,489,372 - 143,798,481 200,000 435,487,853 16031 NC State Univ. Agric. Research Services 45,346,634 - 2,372,514 8,016,973 55,736,121 16032 NC State Univ. Agric. Extension Services 35,668,328 - 443,600 14,683,685 50,795,613 16040 UNC at Greensboro 108,407,940 - 45,836,708 111,798 154,356,446 16050 UNC at Charlotte 117,877,753 - 67,082,104 100,000 185,059,857 16055 UNC at Asheville 27,372,414 - 10,202,946 10,400 37,585,760 16060 UNC at Wilmington 66,436,900 - 42,763,775 71,575 109,272,250 16065 East Carolina Univ. Academic 150,584,434 - 77,771,873 145,900 228,502,207 16066 East Carolina Univ. Health Services 43,971,394 - 2,502,000 - 46,473,394 16070 NC Agric. & Tech. State Univ. 74,789,650 - 39,872,757 58,714 114,721,121 16075 Western Carolina Univ. 59,535,063 - 20,959,932 148,874 80,643,869 16080 Appalachian State Univ. 92,431,431 - 43,875,352 77,725 136,384,508 16082 UNC at Pembroke 38,580,141 - 10,550,300 42,968 49,173,409 16084 Winston-Salem State Univ. 42,807,846 - 10,804,011 74,805 53,686,662 16086 Elizabeth City State Univ. 26,225,776 - 5,665,593 48,400 31,939,769 16088 Fayetteville State Univ. 38,740,661 - 11,859,002 109,202 50,708,865 16090 NC Central Univ. 53,297,914 - 24,891,928 108,431 78,298,273 16092 NC School of the Arts 20,715,128 - 8,862,253 14,550 29,591,931 16094 NC School of Science and Mathematics 14,365,642 - 808,189 - 15,173,831 16095 UNC Hospitals 38,944,579 - 593,010,688 - 631,955,267

Total UNC System 2,249,054,978 - 1,381,775,261 26,049,148 3,656,879,387 Total Education 9,800,262,009 32,517,171 1,580,866,351 930,278,467 12,343,923,998

General Government14100 Administration 62,193,012 - 66,451,796 6,701,151 135,345,959 18210 Office of Administrative Hearings 3,251,079 - 54,859 - 3,305,938 13300 State Auditor 10,898,482 - 50 - 10,898,532 18025 State Board of Elections 5,855,927 - 39,500 - 5,895,427 14160 Office of State Controller 10,044,511 - 27,680 - 10,072,191 14800 Cultural Resources 68,338,163 - 1,946,992 6,109,262 76,394,417 14802 Cultural Resources - Roanoke Island 1,783,374 - - - 1,783,374 11000 General Assembly 47,003,716 - 984,600 - 47,988,316 13000 Governor's Office 5,444,528 - 204,156 - 5,648,684 74660 Information Technology Services (ITS) - - 141,535,413 - 141,535,413 13005 State Budget and Management (OSBM) 5,431,733 - 500 - 5,432,233 13085 OSBM - Special Appropriations 6,464,682 - - - 6,464,682 13010 NC Housing Finance 22,188,445 - 1,231,250 44,623,825 68,043,520 13900 Insurance 28,566,428 - 29,196,167 343,608 58,106,203 13901 Insurance - Worker's Compensation Fund 4,500,000 - 2,495,814 170,725 7,166,539 13100 Lieutenant Governor 841,470 - - - 841,470 14700 Revenue 81,953,032 4,877,766 390,516 - 87,221,314 13200 Secretary of State 9,677,898 - 424,659 - 10,102,557 13410 State Treasurer 8,577,627 817,221 - 9,394,848 13412 State Treasurer - Retirement/Benefits 9,165,457 - - - 9,165,457

28101-07 Special Boards and Commissions - - 23,666,925 8,521,831 32,188,756 Total General Government 392,179,564 4,877,766 269,468,098 66,470,402 732,995,830

258



Health and Human Services14410 Central Administration 63,717,683 - 719,662 89,627,562 154,064,907 14411 Aging 35,031,025 - 9,877,960 38,488,611 83,397,596 14420 Child Development 296,418,707 - 776,000 326,299,398 623,494,105 14424 Education Services 35,278,678 - 434,484 151,860 35,865,022 14430 Public Health 168,949,738 547,503 80,682,979 356,860,544 607,040,764 14440 Social Services 206,361,849 - 514,755,918 693,390,028 1,414,507,795 14445 Medical Assistance 2,643,659,159 - 600,448,697 6,369,552,851 9,613,660,707 14446 Child Health 51,882,902 - - 144,985,535 196,868,437 14450 Services for the Blind 9,756,220 - 1,554,778 14,298,373 25,609,371 14460 Mental Health/DD/SAS 662,795,012 - 53,306,167 94,826,182 810,927,361 14470 Facility Services 16,159,466 - 4,195,135 26,103,500 46,458,101 14480 Vocational Rehabilitation 42,142,193 - 6,390,905 71,635,433 120,168,531

Total Health and Human Services 4,232,152,632 547,503 1,273,142,685 8,226,219,877 13,732,062,697

Justice and Public Safety14500 Correction 1,083,404,206 - 92,096,383 - 1,175,500,589 14900 Crime Control and Public Safety 41,107,768 177,958,725 8,826,313 12,636,367 240,529,173 12000 Judicial 372,852,122 - 616,948 - 373,469,070 12001 Judicial - Indigent Defense 95,331,543 - 8,183,874 - 103,515,417 13600 Justice 83,404,109 - 6,551,138 1,698,412 91,653,659 14060 Juvenile Justice 142,327,686 - 7,635,746 - 149,963,432

Total Justice and Public Safety 1,818,427,434 177,958,725 123,910,402 14,334,779 2,134,631,340

Natural and Economic Resources13700 Agriculture and Consumer Services 54,616,446 4,272,081 23,171,318 6,650,790 88,710,635 14600 Commerce 73,095,748 - 46,852,452 302,264,504 422,212,704 14601 Commerce - State Aid 56,561,225 - - - 56,561,225 14300 Environment and Natural Resources 183,303,051 - 79,166,755 52,553,379 315,023,185 14301 Clean Water Management Trust Fund 100,000,000 - - - 100,000,000 13800 Labor 15,048,819 - 4,997,827 6,794,079 26,840,725

Total Natural and Economic Resources 482,625,289 4,272,081 154,188,352 368,262,752 1,009,348,474

14222 Transportation1 - 2,525,511,527 5,009,205 890,141,025 3,420,661,757

Net Agency 16,725,646,928 2,745,684,773 3,406,585,093 10,495,707,302 33,373,624,096

19600 Capital Improvements 206,343,300 - - - 206,343,300

Debt Service19420 General Debt Service 569,291,140 91,198,625 46,091,140 - 706,580,905 19425 Federal Reimbursement 1,616,380 - - - 1,616,380

Total Debt Service 570,907,520 91,198,625 46,091,140 - 708,197,285

Reserves and Adjustments19001 Contingency and Emergency Reserve 5,000,000 - - - 5,000,000 19003 Compensation Increase Reserve 912,794,519 - - - 912,794,519 19004 Salary Adjustment Reserve 14,094,294 - - - 14,094,294 19006 Reserve for UNC Faculty

Recruiting/Retention5,000,000

5,000,000 19008 Retirement System Payback 30,000,000 - - - 30,000,000 19013 Job Development Incentive Grants (JDIG)

Reserve 12,400,000 - - - 12,400,000 19014 Reserve for Heating/Cooling Assistance 10,000,000 - - - 10,000,000 19020 Reserve for Pending Ethics Legislation 582,673 - - - 582,673 19024 Contingent Appropriation Reserve 85,000,000 - - - 85,000,000 19027 ITS Rate Restructuring Reserve (2,300,000) - - - (2,300,000)

259



19028 Longevity Service Adjustment 41,411 - - - 41,411 19030 Military Morale, Recreation, and Welfare

Reserve1,000,000

1,000,000 19031 Reserve for State Emergency Response 20,000,000 20,000,000 19033 Reserve for Lawsuits 1,065,710 1,065,710 19037 State BEACON Project 44,313,403 - - - 44,313,403 19040 Minimum Fair Wage Reserve 750,000 - - - 750,000 19043 Health Plan Reserve 142,728,000 - - - 142,728,000 19044 IT Initiative Reserve 5,798,826 - - - 5,798,826 19047 Retirement Rate Adjustment Reserve,

Disability Income Plan, Death Benefit 60,403,700

- - - 60,403,700 19049 Mental Health/DD/SAS Trust Fund

Reserve14,390,000

- - - 14,390,000 Total Reserves and Adjustments 1,363,062,536 - - - 1,363,062,536

Total Budget 18,865,960,284 2,836,883,398 3,452,676,233 10,495,707,302 35,651,227,217

General Obligation Bonds and Certificates of Participation 453,500,000 - 656,290,000 - 1,109,790,000

Grand Total Budget Including General Obligation Bonds and Certificates of Participation 19,319,460,284$ 2,836,883,398$ 4,108,966,233$ 10,495,707,302$ 36,761,017,217$

1. Transportation excludes $57,486,602 of Highway Trust Fund transfer to General Fund.

260


Table 4Trends in the Total State Budget, 1982-83 to 2006-07(In Millions)

Fiscal Public Higher Community HumanYear Education Education Colleges Resources Transportation Correction

1982-83 1,798.5 856.4 232.0 1,462.2 626.8 176.1 1983-84 1,906.6 944.4 261.7 1,601.3 864.3 190.5 1984-85 2,170.4 1,058.9 288.2 1,719.6 893.4 212.7 1985-86 2,501.4 1,219.8 304.7 1,945.6 908.1 244.3 1986-87 2,660.6 1,300.7 337.1 2,032.8 1,005.7 261.7 1987-88 2,939.7 1,414.4 358.9 2,251.2 1,086.1 306.0 1988-89 3,230.8 1,483.2 364.7 2,435.8 1,111.7 343.1 1989-90 3,468.2 1,662.2 403.2 2,695.5 1,399.1 380.8 1990-91 3,672.0 1,700.0 433.5 3,012.3 1,378.5 428.0 1991-92 3,688.6 1,647.3 410.7 3,661.6 1,512.3 484.8 1992-93 3,829.0 1,728.9 476.8 4,244.2 1,614.3 517.2 1993-94 4,128.2 1,850.9 504.0 5,289.4 1,727.9 577.4 1994-95 4,417.1 1,932.9 534.6 5,616.5 1,850.1 732.5 1995-96 4,477.5 2,035.1 546.1 5,910.1 1,917.5 815.4 1996-97 4,783.6 2,121.3 576.6 6,324.4 1,987.6 833.3 1997-98 5,191.6 2,262.6 610.6 6,955.9 2,106.4 831.0 1998-99 5,549.9 2,321.1 659.9 7,604.9 2,125.4 859.0 1999-00 6,033.2 2,473.6 681.5 7,814.7 2,492.9 899.2 2000-01 6,366.8 2,555.3 724.1 8,213.6 2,635.8 883.0 2001-02 6,635.5 2,781.0 772.1 9,567.5 2,808.3 933.3 2002-03 6,534.6 2,814.1 825.6 10,404.5 2,598.5 890.6 2003-04 6,995.3 3,016.8 832.9 10,581.2 2,800.8 950.7 2004-05 7,118.6 3,103.5 880.6 11,553.0 2,831.3 959.1 2005-06 7,541.9 3,480.3 997.1 13,025.8 3,336.3 1,122.1 2006-07 7,654.9 3,656.9 1,032.1 13,732.1 3,420.7 1,175.5

Fiscal General DebtYear Government Service Reservesa Capitalb Otherc Total

1982-83 640.7 114.2 11.4 72.4 - 5,990.7 1983-84 698.4 117.8 2.9 116.0 - 6,703.9 1984-85 755.1 114.5 6.3 234.1 - 7,453.2 1985-86 843.4 114.2 21.1 298.0 - 8,400.6 1986-87 909.9 98.2 15.8 334.0 - 8,956.5 1987-88 972.4 111.9 18.7 265.3 - 9,724.6 1988-89 1,012.7 108.9 2.6 316.9 - 10,410.4 1989-90 1,270.4 107.6 - 377.6 231.8 11,996.4 1990-91 1,289.8 108.7 147.3 292.5 476.8 12,939.5 1991-92 1,375.7 117.9 0.9 242.6 468.0 13,610.4 1992-93 1,437.0 127.0 (5.4) 274.5 232.4 14,508.7 1993-94 1,701.9 129.6 221.5 910.1 236.8 17,277.7 1994-95 1,859.3 142.5 235.0 592.6 236.8 18,149.9 1995-96 1,735.0 157.0 6.9 456.0 - 18,056.6 1996-97 1,764.2 135.4 135.6 1,118.0 d - 19,780.2 1997-98 1,693.5 167.2 104.6 1,201.4 d - 21,124.8 1998-99 1,759.0 200.4 221.1 883.5 d 447.4 22,631.6 1999-00 1,922.5 244.1 222.6 877.1 d 629.0 24,290.4 2000-01 1,904.8 270.0 494.3 424.0 d 30.0 24,501.7 2001-02 1,949.5 302.6 13.2 762.9 d 40.0 26,565.9 2002-03 1,841.3 301.2 (5.4) 881.2 d 66.5 27,152.7 2003-04 1,907.6 438.1 278.3 1,533.3 d 62.0 29,397.0 2004-05 1,973.7 561.1 644.4 1,534.2 d 62.0 31,221.5 2005-06 2,452.3 676.9 563.2 1,243.7 d 100.0 34,539.6 2006-07 2,601.4 708.2 1,363.1 1,316.1 d 100.0 36,761.0

a. Includes funds transferred to the reserve for budget stabilization.b. Includes the repair and renovation reserve.c. Includes the local government transfer and appropriated reserves.d. Includes general obligation bonds.

261


Table 5Total Authorized State Budget by Source of Funds, 1976-77 to 2006-07

(In Millions)

FederalFiscal General Revenue HighwayYear Fund Sharing Fund Federal Other Total

1976-77 1,922.4$ 67.1$ 414.6$ 776.8$ 282.9$ 3,463.8$ 1977-78 2,158.0 66.9 433.1 967.9 351.4 3,977.3 1978-79 2,515.4 62.5 461.8 1,042.7 328.5 4,410.9 1979-80 2,787.7 57.0 497.6 1,240.5 448.8 5,031.7 1980-81 3,216.4 28.4 506.1 1,296.5 395.7 5,443.1 1981-82 3,435.0 - 535.0 1,312.7 470.0 5,752.8 1982-83 3,623.6 - 555.6 1,322.3 485.9 5,987.4 1983-84 3,872.6 - 664.0 1,597.4 584.9 6,718.9 1984-85 4,516.6 - 713.6 1,655.8 551.7 7,437.7 1985-86 5,130.5 - 735.5 1,838.1 696.4 8,400.5 1986-87 5,531.3 - 839.4 1,887.4 698.3 8,956.4 1987-88 5,977.9 - 882.4 2,026.8 837.1 9,724.2 1988-89 6,586.1 - 918.7 2,117.4 788.2 10,410.4 1989-90 7,360.0 - 1,236.6 2,366.8 1,033.0 11,996.4 1990-91 8,149.6 a - 1,223.8 2,616.8 949.4 12,939.6 1991-92 7,983.0 a - 1,323.3 3,127.8 1,176.2 13,610.3 1992-93 8,209.5 - 1,318.4 3,617.6 1,363.2 14,508.7 1993-94 9,405.4 - 1,363.3 4,516.4 1,456.5 16,741.6 1994-95 10,268.4 - 1,480.9 4,639.9 1,580.7 17,969.9 1995-96 10,055.5 - 1,553.4 4,664.4 1,783.3 18,056.6 1996-97 11,252.6 b - 1,622.5 4,917.3 1,987.8 19,780.2 1997-98 12,015.3 c - 2,025.5 5,220.4 1,863.6 21,124.8 1998-99 13,561.6 c - 1,807.6 5,465.3 1,797.1 22,631.6 1999-00 14,561.7 c - 1,878.8 5,951.1 1,898.8 24,290.4 2000-01 14,350.1 c - 2,058.8 6,134.4 1,958.4 24,501.7 2001-02 15,135.3 c - 2,121.1 7,066.3 2,243.2 26,565.9 2002-03 15,205.1 c - 1,900.0 7,676.5 2,371.0 27,152.6 2003-04 15,930.8 c - 2,477.7 8,465.8 2,522.7 29,397.0 2004-05 17,107.3 c - 2,469.6 8,967.1 2,677.5 31,221.5 2005-06 18,033.9 c - 2,744.7 9,972.0 3,789.0 34,539.6 2006-07 19,319.5 c - 2,836.9 10,495.7 4,108.9 36,761.0

a. Includes legislative bonds for capital improvements.b. Includes $4.7 million from the 1997 Session of the General Assembly and general obligation bonds.c. Includes general obligation bonds.

262


Table 6Highway Fund State Tax and Nontax Revenue, 1974-75 to 2006-07

(In Millions)

Motor Licenses, PercentageFiscal Fuel Fees, and Treasurer's Total Change fromYear Taxes Other Revenue Investments Revenue Previous Year

1974-75 265.8$ 95.2$ 23.9$ 384.9$ 10.0%1975-76 286.4 103.8 15.1 405.4 5.3%1976-77 298.3 106.5 11.9 416.6 2.8%1977-78 312.0 114.2 9.9 436.2 4.7%1978-79 322.8 120.5 21.7 465.0 6.6%1979-80 304.0 125.7 17.9 447.6 (3.7%)1980-81 291.2 130.0 13.9 435.1 (2.8%)1981-82 380.8 151.7 22.3 554.8 27.5%1982-83 388.6 161.1 28.5 578.2 4.2%1983-84 411.8 200.0 30.2 642.0 11.0%1984-85 421.7 212.7 33.3 667.7 4.0%1985-86 438.7 219.7 26.5 684.9 2.6%1986-87 569.3 234.3 26.2 829.8 21.2%1987-88 612.2 250.5 33.9 896.6 8.1%1988-89 625.8 257.2 30.7 913.7 1.9%1989-90 619.7 257.9 26.6 904.2 (1.0%)1990-91 629.4 252.6 21.4 903.4 (0.1%)1991-92 650.6 273.6 19.6 943.8 4.5%1992-93 648.8 275.9 17.6 942.3 (0.2%)1993-94 677.6 283.8 18.4 979.8 4.0%1994-95 681.1 295.6 19.7 996.5 1.7%1995-96 709.2 320.4 19.7 1,049.3 5.3%1996-97 742.8 320.2 13.1 1,076.1 2.6%1997-98 774.5 328.4 10.1 1,113.0 3.4%1998-99 775.5 340.0 15.5 1,131.0 1.6%1999-00 793.5 352.5 18.6 1,164.6 3.0%2000-01 880.8 364.3 15.4 1,260.5 8.2%2001-02 901.3 379.7 17.2 1,298.2 3.0%2002-03 861.9 379.4 18.8 1,260.1 (2.9%)2003-04 949.6 400.9 11.5 1,362.0 8.1%2004-05 975.1 423.3 9.5 1,407.9 3.4%2005-06 1,108.6 a 558.0 14.1 1,680.7 19.4%2006-07 1,188.8 a 552.7 8.0 1,749.5 4.1%

a. Authorized

263


Table 7Highway Trust Fund Tax and Nontax Revenue, 1989-90 to 2006-07

(In Millions)

PercentageFiscal Gasoline Highway Other Treasurer's Total Change fromYear Tax Use Tax Revenue Investments Revenue Previous Year

1989-90 184.9$ 164.7$ 51.5$ 7.4$ 408.5$ - 1990-91 206.6 231.1 55.4 20.8 513.9 25.8%1991-92 213.4 242.4 58.4 23.1 537.3 4.6%1992-93 212.4 273.3 62.2 24.1 572.0 6.5%1993-94 222.0 330.5 68.1 22.5 643.1 12.4%1994-95 223.0 364.6 77.1 28.7 693.4 7.8%1995-96 232.7 396.0 76.7 32.7 738.1 6.4%1996-97 243.7 407.6 85.7 35.7 772.7 4.7%1997-98 254.6 453.3 87.0 40.9 835.8 8.2%1998-99 254.7 489.5 90.3 39.3 873.8 4.5%1999-00 260.7 545.3 93.2 37.4 936.6 7.2%2000-01 289.6 545.2 90.6 41.4 966.8 3.2%2001-02 296.3 555.3 90.7 31.5 973.8 0.7%2002-03 283.1 552.7 90.9 11.7 938.4 (3.6%)2003-04 310.8 578.4 95.9 8.9 994.0 5.9%2004-05 320.4 580.1 97.0 6.5 1,004.0 1.0%2005-06 a 366.5 577.2 106.1 1.5 1,051.3 4.7%2006-07 a 391.3 590.4 110.7 2.5 1,094.9 4.1%

a. Authorized

264


Table 8General Fund Tax and Nontax Revenue, 1974-75 to 2006-07

(Excludes Federal Revenue Sharing and Federal Anti-Recession Funds)

(In Millions)

Percentage Tax and PercentageFiscal Tax Change from Nontax Change fromYear Revenues Previous Year Revenuesa Previous Year

1974-75 1,451.2$ 6.85% 1,544.1$ 7.99%1975-76 1,571.8 8.31% 1,648.1 6.74%1976-77 1,870.0 18.97% 1,952.6 18.48%1977-78 2,060.5 10.19% 2,134.8 9.33%1978-79 2,337.2 13.43% 2,430.3 13.84%1979-80 2,639.2 12.92% 2,785.3 14.61%1980-81 2,846.0 7.84% 2,995.4 7.54%1981-82 3,077.7 8.14% 3,229.5 7.82%1982-83 3,279.0 6.54% 3,403.8 5.40%1983-84 3,814.4 16.33% 3,957.3 16.26%1984-85 4,336.7 13.69% 4,527.1 14.40%1985-86 4,694.5 8.25% 4,910.9 8.48%1986-87 5,180.6 10.35% 5,392.1 9.80%1987-88 5,551.3 7.16% 5,804.5 7.65%1988-89 5,928.5 6.79% 6,154.5 6.03%1989-90 6,561.4 10.68% 6,988.4 13.55%1990-91 6,692.5 2.00% 7,207.8 3.14%1991-92 7,438.4 11.15% 7,817.0 8.45%1992-93 7,883.0 5.98% 8,292.8 6.09%1993-94 8,516.8 8.04% 9,102.3 9.76%1994-95 9,365.8 9.97% 9,969.9 9.53%1995-96 9,458.8 0.99% 10,090.3 1.21%1996-97 10,239.1 8.25% 10,933.9 8.36%1997-98 11,092.4 8.33% 11,727.1 7.25%1998-99 11,965.3 7.87% 12,753.3 8.75%1999-00 12,391.0 3.56% 13,135.0 2.99%2000-01 12,573.1 1.47% 13,451.9 2.41%2001-02 12,444.7 (1.02%) 13,510.0 0.43%2002-03 13,117.2 5.40% 14,246.1 b 5.45%2003-04 13,830.7 5.44% 14,936.5 b 4.85%2004-05 15,477.6 11.91% 16,326.5 9.31%2005-06 c 17,020.5 9.97% 17,874.3 c 9.48%2006-07 c 17,432.1 2.42% 18,116.6 c 1.36%

a. Nontax revenue includes transfers from the Highway Fund and Highway Trust Fund plus capital improvement appropriations returned to the General Fund.b. Includes a transfer of $136.9 million of federal fiscal relief funds.c. Authorized budgeted revenues.

265


Table 9Authorized General Fund Appropriations, 1976-77 to 2006-07

(Including Federal Revenue Sharing and Anti-Recession Revenues)

(In Millions)

Percentage PercentageFiscal Change from Change fromYear Operating Previous Year Total Previous Year

1976-77 1,944.4$ 10.7% 1,989.5$ 11.5%1977-78 2,193.5 12.8% 2,224.9 11.8%1978-79 2,451.9 11.8% 2,577.9 15.9%1979-80 2,760.3 12.6% 2,844.7 10.3%1980-81 3,140.9 13.8% 3,244.8 14.1%1981-82 3,404.8 8.4% 3,435.0 5.9%1982-83 3,557.8 4.5% 3,623.6 5.5%1983-84 3,797.8 a 6.7% 3,857.6 6.5%1984-85 4,304.0 13.3% 4,516.6 17.1%1985-86 4,877.0 13.3% 5,130.5 13.6%1986-87 b 5,233.7 7.3% 5,531.6 7.8%1987-88 5,813.1 11.1% 5,977.9 8.1%1988-89 6,302.4 8.4% 6,561.1 9.8%1989-90 6,883.0 9.2% 7,360.0 12.2%1990-91 7,249.5 5.3% 8,074.6 9.7%1991-92 7,350.5 1.4% c 7,825.5 (3.1%)1992-93 7,877.5 7.2% c 8,209.5 4.9%1993-94 8,674.5 10.1% 9,317.9 13.5%1994-95 9,662.2 11.4% 10,268.4 10.2%1995-96 9,793.1 1.4% 10,031.6 (2.3%)1996-97 d 10,450.4 6.7% 10,607.6 5.7%1997-98 e 11,258.5 7.7% 11,585.8 9.2%1998-99 12,333.5 9.5% 13,111.6 13.2%1999-00 13,381.6 8.5% c 14,237.7 8.6% c

2000-01 13,785.1 3.0% 14,050.1 (1.3%)2001-02 14,372.4 f 4.3% 14,530.3 3.4%2002-03 14,323.9 (0.3%) 14,355.1 (1.2%)2003-04 14,835.6 3.6% 14,863.2 3.5%2004-05 15,873.2 7.0% 15,918.4 7.1%2005-06 17,126.4 7.9% 17,181.4 7.9%2006-07 18,659.7 9.0% 18,866.0 9.8%

a. Includes $25.8 million transferred to the Highway Fund.b. Includes $240,101 for Department of Correction emergency appropriation for operating budget and $15,125,690 for capital improvements.c. Percentage revised in 2003.d. Includes $4.7 million for Department of Community Colleges appropriation for operating budget.e. Includes $20.5 million for SIPS for the Year 2000 project.f. Effective July 1, 2002, the General Assembly established an annual General Fund appropriation for the Clean Water Management Trust Fund. Funding for this program is included in total current operations.

266


Table 10General Fund Operating Appropriation for Public Schools, Community Colleges, and Higher Education, 1985-86 to 2006-07

(Includes Carryforwards for Encumbrances)

General Fund Percent ofFiscal Total Current TotalYear Operationsa Amount Percent Amount Percent Amount Percent Education Other

1985-86 4,877,060,744$ 2,185,803,123$ 44.8% 281,875,727$ 5.8% 840,311,094$ 17.2% 67.8% 1,569,070,800$ 1986-87 5,233,578,633 2,346,139,866 44.8% 307,102,490 5.9% 909,134,150 17.4% 68.1% 1,671,202,127 1987-88 5,805,245,729 2,639,237,658 45.5% 326,296,294 5.6% 980,746,492 16.9% 68.0% 1,858,965,285 1988-89 6,302,733,865 2,930,643,886 46.5% 332,064,381 5.3% 1,039,510,499 16.5% 68.3% 2,000,515,099 1989-90 6,883,003,393 3,134,428,205 45.5% 365,537,274 5.3% 1,109,917,895 16.1% 67.0% 2,273,120,019 1990-91 7,249,549,110 3,329,171,720 45.9% 387,611,956 5.3% 1,143,216,957 15.8% 67.0% 2,389,548,477 1991-92 7,350,501,134 3,293,699,663 44.8% 344,131,858 4.7% 1,121,976,740 15.3% 64.8% 2,590,692,873 1992-93 7,881,908,182 3,435,634,234 43.6% 398,689,471 5.1% 1,170,947,533 14.9% 63.5% 2,876,636,944 1993-94 8,674,510,752 b 3,632,087,114 41.9% 423,253,702 4.9% 1,229,449,670 14.2% 60.9% 3,389,720,266 1994-95 9,595,509,023 b 3,962,959,317 c 41.3% 455,651,184 4.7% 1,296,558,991 13.5% 59.6% 3,880,339,531 1995-96 9,793,062,378 3,998,978,216 40.8% 470,880,697 4.8% 1,301,040,079 13.3% 58.9% 4,022,163,386 1996-97 10,450,411,229 4,301,626,282 41.2% 501,802,184 4.8% 1,385,611,961 13.3% 59.2% 4,261,370,802 1997-98 11,258,582,548 4,697,892,305 41.7% 534,873,175 4.8% 1,489,866,397 13.2% 59.7% 4,535,950,671 1998-99 12,327,025,974 5,068,634,951 41.1% 587,542,475 4.8% 1,628,888,154 13.2% 59.1% 5,041,960,394 1999-00 d 13,441,610,285 5,497,075,780 40.9% 589,634,008 4.4% 1,682,143,914 12.5% 57.8% 5,672,756,583 2000-01 e 13,785,142,760 5,851,733,197 g 42.4% 651,456,631 4.7% 1,778,278,150 12.9% 60.1% 5,503,674,782 2001-02 f 14,309,884,168 5,922,505,768 g 41.4% 650,089,707 4.5% 1,802,904,395 12.6% 58.5% 5,934,384,298 2002-03 e 14,323,937,462 5,946,490,760 g 41.5% 669,281,390 4.7% 1,768,097,109 12.3% 58.5% 5,940,068,203 2003-04 14,835,621,783 6,114,518,997 e g 41.2% 665,027,719 4.5% 1,792,141,661 12.1% 57.8% 6,263,933,406 2004-05 15,873,167,528 6,287,744,646 e g 39.6% 691,811,541 4.4% 1,878,813,497 11.8% 55.8% 7,014,797,844 2005-06 17,126,460,791 6,721,053,466 e g 39.2% 817,427,539 e 4.8% 2,126,803,399 12.4% 56.4% 7,461,176,387 2006-07 18,659,616,984 7,096,499,112 e g 38.0% 893,085,886 e 4.8% 2,365,613,366 12.7% 55.5% 8,304,418,620

Note: Figures in all categories include compensation increases.a. Operating budget excludes capital and local government appropriations.b. Data exclude $214 million (1993-94) and $120 million (1994-95) for payroll restoration.c. Data include $42 million for education technology equipment.d. Data include all appropriations as of June 30, 2000.e. Amounts include a compensation increase reserve.f. Amounts include a compensation increase, health plan increase, and retirement rate adjustment.g. Encumbrance carryforwards for the eleventh and twelfth months are no longer included.

Public Schools Community Colleges Higher Education

267


Table 11North Carolina's Bond Indebtedness, 1968-69 to 2005-06

Bond Indebtednessa

Fiscal General Highway Per Year Fund Fund Total Capitab

1968-69 210,270,000$ 189,200,000$ c 399,470,000$ 79.80$ 1969-70 198,740,000 282,200,000 d 480,940,000 95.56 1970-71 186,910,000 253,000,000 439,910,000 86.12 1971-72 174,780,000 240,000,000 414,780,000 79.74 1972-73 208,360,000 217,000,000 425,360,000 80.30 1973-74 194,995,000 199,000,000 393,995,000 73.17 1974-75 215,370,000 181,000,000 396,370,000 72.54 1975-76 305,870,000 163,000,000 468,870,000 84.66 1976-77 418,900,000 145,000,000 563,900,000 100.73 1977-78 530,600,000 127,000,000 657,600,000 115.90 1978-79 507,200,000 164,000,000 671,200,000 116.82 1979-80 533,300,000 201,000,000 734,300,000 126.43 1980-81 574,750,000 179,000,000 753,750,000 128.19 1981-82 544,200,000 219,000,000 763,200,000 128.15 1982-83 582,700,000 323,000,000 905,700,000 150.48 1983-84 630,900,000 306,500,000 937,400,000 154.25 1984-85 589,200,000 290,000,000 879,200,000 142.62 1985-86 548,500,000 272,500,000 821,000,000 131.26 1986-87 508,000,000 254,000,000 762,000,000 120.51 1987-88 525,500,000 250,000,000 775,500,000 121.06 1988-89 481,410,000 226,750,000 708,160,000 109.23 1989-90 457,698,902 202,730,000 660,428,902 100.54 1990-91 412,038,903 175,965,000 588,003,903 88.66 1991-92 441,378,903 148,635,000 590,013,903 87.44 1992-93 548,678,902 118,695,000 667,373,902 97.67 1993-94 493,678,902 87,055,000 580,733,902 83.59 1994-95 936,191,005 55,285,000 991,476,005 140.40 1995-96 990,245,681 29,445,000 1,019,690,681 141.90 1996-97 940,252,373 4,895,000 945,147,373 129.32 1997-98 1,508,215,259 - 1,508,215,259 202.97 1998-99 1,867,480,343 250,000,000 2,117,480,343 280.56 1999-00 2,212,108,040 233,325,000 2,445,433,040 319.64 2000-01 2,286,848,925 216,650,000 2,503,498,925 305.82 2001-02 2,832,409,153 199,975,000 3,032,384,153 370.42 2002-03 3,274,944,986 183,300,000 3,458,244,986 415.65 2003-04 3,892,442,828 166,625,000 4,059,067,828 479.99 2004-05 4,881,651,426 811,430,000 5,693,081,426 673.21 2005-06 4,977,910,995 756,755,000 5,734,665,995 660.90

a. The State Treasurer's Annual Report and Official Statement of the State Treasurer as of June 30 for the following fiscal year.b. Based on July 1 population estimates.c. Includes $60 million from bond anticipation notes.d. Includes $120 million from bond anticipation notes.

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Table 12Total North Carolina Budget for Debt Services, 1968-69 to 2006-07

Authorized BudgetFiscal General Highway PerYear Fund Fund Total Capita1

1968-69 17,780,948$ 34,106,500$ 51,887,448$ 10.37$ 1969-70 17,774,223 40,401,067 58,175,290 11.56 1970-71 17,757,503 25,599,500 43,357,003 8.49 1971-72 18,631,260 32,617,500 51,248,760 9.85 1972-73 21,466,030 25,749,000 47,215,030 8.91 1973-74 48,147,042 25,083,000 73,230,042 13.60 1974-75 - 24,415,500 24,415,500 4.47 1975-76 34,870,615 23,776,500 58,647,115 10.59 1976-77 40,024,500 23,156,000 63,180,500 11.29 1977-78 49,202,210 27,522,500 76,724,710 13.52 1978-79 53,000,000 29,596,000 82,596,000 14.38 1979-80 55,341,050 29,292,661 84,633,711 14.57 1980-81 62,173,700 30,329,757 92,503,457 15.73 1981-82 65,062,550 30,062,040 95,124,590 15.97 1982-83 75,020,500 38,772,567 113,793,067 18.91 1983-84 79,525,500 38,288,000 117,813,500 19.39 1984-85 76,077,250 38,401,500 114,478,750 18.57 1985-86 75,781,250 38,445,500 114,226,750 18.26 1986-87 64,506,250 38,445,500 102,951,750 16.28 1987-88 73,929,627 32,453,812 106,383,439 16.61 1988-89 71,636,370 37,295,105 108,931,475 16.80 1989-90 69,083,445 38,491,163 107,574,608 16.38 1990-91 71,259,383 37,392,600 108,651,983 16.10 1991-92 79,683,770 38,227,230 117,911,000 17.47 1992-93 89,020,478 38,018,250 127,038,728 18.59 1993-94 92,263,558 37,359,875 129,623,433 18.66 1994-95 114,837,478 27,631,295 142,468,773 20.17 1995-96 131,836,603 25,133,780 156,970,383 21.84 1996-97 129,326,640 4,978,215 134,304,855 18.38 1997-98 165,973,573 - 165,973,573 22.34 1998-99 199,286,633 28,357,925 227,644,558 30.16 1999-00 242,910,930 27,607,550 270,518,480 41.66 2000-01 268,834,550 26,857,175 295,691,725 36.12 2001-02 301,428,690 26,106,800 327,535,490 40.01 2002-03 300,016,860 25,356,425 325,373,285 39.11 2003-04 403,285,920 33,706,050 436,991,970 52.52 2004-05 489,914,203 69,589,925 559,504,128 66.16 2005-06 581,837,505 93,449,000 675,286,505 79.85 2006-07 615,382,280 91,198,625 706,580,905 81.43

1. Based on July 1 population estimates.

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