Last week the NC General Assembly took a spring recess, during which many members took the opportunity to put their ideas for the state on paper, leading to 248 bills being filed. Since the Senate's bill filing deadline was last Tuesday, 214 of those were Senate bills. Expect budget negotiations to get off the ground within the next several weeks, as last week Chairs of the Appropriations Committees in the House and Senate began to meet and discuss their priorities.

The state has continued to move in a positive direction with combating the coronavirus pandemic, but key indicators have peaked since the Easter holiday. The seven-day rolling average of positive cases is slightly higher than it was three weeks ago, but there are fewer confirmed hospitalizations today than one week ago.

As of Thursday morning, in the state of North Carolina, there were 2,359 confirmed cases of the coronavirus, 1,020 individuals hospitalized, and sadly, 12,359 confirmed deaths. There have been 6,164,243 doses of the vaccine distributed in NC.

As we all continue to feel the effects of the global pandemic and adjust to a new normal, we want to highlight a few ways our clients across North Carolina have worked to support residents and make this time a little easier for those throughout the state. Read more about what our clients are doing to help by clicking here.

For more information on COVID-19 in North Carolina, click here to visit the Department of Health and Human Services website, and be sure to stay up to date on the latest federal guidelines issued by the Centers for Disease Control and Prevention (CDC) by clicking here.

Opportunity Scholarships

A bill to expand the Opportunity Scholarship Program, a program designed to help parents afford private-school tuition for their children, passed the N.C. House on Wednesday after a lengthy floor debate. The bill, HB32: Equity in Opportunity Act, would remove the current $4,200 cap on scholarships, and instead create a formula based on the state’s per-pupil funding. Recipients would initially be eligible to share in 70% of the funding the state allocates for per-pupil funding in the 2022-23 school year, and in the 2023-24 school year, the rate would be raised to 80%. Additionally, it would allow a county to provide up to $1,000 in additional supplements to scholarship recipients, on top of the state’s allocation. Beyond Opportunity Scholarships, the bill would also combine the Special Education Scholarship for Children with Disabilities and the Personal Education Savings Account into one program to provide qualifying students with disabilities with up to $17,000 in scholarships.

The Opportunity Scholarship Program is intended to assist low income families seeking a private education. In order to qualify, a family’s household income cannot exceed 150% of the amount required to qualify for the free or reduced-price lunch program. The bill’s primary sponsor, Rep. Dean Arp (R-Union) argued that the bill would eliminate discrimination in school choice. “This bill would ensure North Carolina treats all students equally, regardless of disability or income level.” But Democrats on the other side of the aisle disagreed. Rep. Raymond Smith (D-Wayne) argued for increased public school funding, saying, “We are allowing low-wealth families to attend substandard public schools, and operate in segregated school environments.”

Democrats have long been opposed to the Opportunity Scholarship Program on the basis of accountability. Rep. Rachel Hunt (D-Mecklenburg) offered an amendment which would implement testing and reporting requirements at nonpublic schools that receive Opportunity Scholarship money, but it failed after several Republican Representatives argued that there are already nationally recognized tests occurring in private schools. Democratic Governor Roy Cooper has also been a stalwart opponent of private school vouchers and the Opportunity Scholarship program. In the Governor’s budget recommendations, he proposed eliminating the program altogether.

COVID-19 Tax Changes

On March 17, 2021 the Internal Revenue Service (IRS) extended the federal income tax filing due date for individuals for the 2020 tax year from April 15, 2021 to May 17, 2021. In March, the Secretary of Revenue, Ronald Penny, announced that the Department of Revenue would extend the tax filing and payment deadline of state taxes to mirror the IRS changes. However, the Secretary did not have the statutory authority to waive or prevent the accrual of interest on late payments. Without a change in the law, tax payments received after April 15 would be charged accruing interest until received by the Department.

Representatives filed HB279: COVID-Related Tax Changes to make this statutory change, which would provide for the nonaccrual of interest on taxes due this year. The bill also makes a change to property tax exemptions based on income. Current law governing elderly or disabled homestead exclusions, or the homestead circuit breaker program, states that income for purposes of qualifying for one of these programs could include the federal COVID-19 stimulus payments. HB279 also seeks to rectify that issue by exempting stimulus payments from income qualifications.

The bill passed the full House on Thursday and now goes to the Senate.

School Calendar Flexibility

For years, legislators and school board members from across the state have tried to give local officials the authority to decide when students in their counties start and end the school year. Since 2004, the state’s school calendar law has required every school district to begin the school year no earlier than the Monday closes to August 26 and end no later than the Friday closest to June 11. In 2019, legislators floated several bills to give specific counties the authority to change their calendars in response to recent hurricanes and snowstorms, but they were met with significant opposition by the travel industry. In a 2019 report, the NC Travel Industry Association called the summer season “North Carolina’s most precious tourism industry national resource,” and they lobbied to prevent those efforts to allow school districts from beginning the school year any earlier.

This session, legislators in the House are pushing similar calendar flexibility bills, in response to learning loss caused by the COVID-19 pandemic. On Tuesday, the NC House Education Committee approved 17 bills to give districts the authority to alter their school year. And on Wednesday, the House approved bills to give this flexibility to Cumberland, Franklin, Lenoir, Nash-Rocky Mount, Pitt, Chatham, Edgecombe, Martin, Surry and Union County schools, and to Mt. Airy and Elkin City Schools.

The bills easily passed the House, but one vocal opponent, Rep. Frank Iler (R-Brunswick) spoke against the bills. “I think it should be labeled child abuse to send anybody back to school before Labor Day,” said Iler.

In 2019, the calendar flexibility bills passed the House, but they were stalled in the Senate. This year, it seems like there is a chance they could see the same fate. On Tuesday, Senate leader Phil Berger (R-Rockingham) said in an interview that if the bills were like those in the past, “I don’t know that there will be any different reaction, as far as the Senate is concerned.”

Interlocking Ignition Bill

Recently released data from the AAA Foundation for Traffic Safety shows that North Carolina has experienced a 75% uptick in fatalities from wrong-way car crashes over the past few years. Nationwide, there has been a 32% increase. These crashes can mostly be blamed on drivers impaired by alcohol. The same study showed that more than 60% of wrong-way drivers had BACs above the legal limit. According to the NCDOT, more than half of the 129 wrong-way crashes from 2000-2013 involved an impaired driver.

For years, advocates for safer driving have recommended increasing the use of ignition interlocking devices to cut down on the number of impaired drivers. An ignition interlock device requires an individual to breathe into the device to start the vehicle; if the individual’s breath alcohol concentration is outside the acceptable range, the vehicle will not start. Currently, the devices are installed at the expense of the driver, and a driver must go through DMV to waive installations on additional vehicles. Current law mandates DMV to require these devices for certain drivers whose licenses are restored following conviction of impaired driving.

This year, state lawmakers have introduced legislation to reform North Carolina’s ignition interlock laws. SB183: Begin Modernizing Ignition Interlock Laws would reduce the amount of time required to have an interlock device installed, and allow an individual to avoid placing interlocks on every car they own. The bill would also expand the current waiver for financial hardship to those at or below 150% of the federal poverty level.

The bill moved through the Senate this week and passed out of the Rules Committee on Thursday. There is also a companion bill in the House, which passed the Judiciary 2 Committee on Friday.