Legislative Report

Report 09-01
January 30, 2009

Legislature Begins a Difficult Session

The North Carolina General Assembly convened at 12:00 Noon on Wednesday, January 28, 2009 for what may prove to be the most challenging session since the Great Depression. Rising unemployment has had a significant impact on state revenue collections, especially the personal income tax, the state’s largest revenue source. The estimates of the revenue shortfall for 2009-10 range from slightly less than $2 billion to $3 billion.

We expect the General Assembly to begin the review of the budget to identify potential reductions as soon as committee appointments are complete. Both the General Assembly and Governor Beverly Perdue will keep a close watch on the progress of the Federal economic stimulus legislation that now is before the U.S. Congress. Federal financial aid will be a major factor in this year’s state budget deliberations.

Major Challenges for Retirees

Our top priority for the 2009 Session is the stability of the State Health Plan. As you know, the General Assembly learned in June 2008 that the Plan faced a deficit in 2009. We expect the General Assembly to transfer monies from the state’s “Rainy Day” Fund to cover shortfalls for the remainder of the 2008-09 fiscal year.

We learned yesterday in a preliminary discussion with Senator Rand that the General Assembly likely would consider legislation to restore the fiscal stability to the State Health Plan early in this session. The Senator said that the process would involve NCRGEA and other stakeholders with the aim to obtain legislative approval of necessary changes to the Plan by early April. This would allow any changes to benefits, co-pays, and deductibles to be in place by July 1, 2009.

The General Assembly web page is the most accurate source of current contact information for your legislators. The information for each legislator includes phone number, mailing address, and e-mail address. The web page can be accessed at
www.ncga.state.nc.us.

Legislative Report Schedule

The regular Legislative Report will be sent out every Friday afternoon during the 2009 Session. Special Reports will be sent out as needed to keep members informed and active on fast-breaking issues. We appreciate your support.