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Carolina Journal Radio No. 745: Double standard exists involving profit and public schools

Carolina Journal Radio / Donna Martinez and Mitch Kokai
The Truth Network Radio
August 28, 2017 12:00 am

Carolina Journal Radio No. 745: Double standard exists involving profit and public schools

Carolina Journal Radio / Donna Martinez and Mitch Kokai

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August 28, 2017 12:00 am

Gov. Roy Cooper recently announced a statewide drive to collect classroom supplies for public schools. Terry Stoops, the John Locke Foundation’s vice president for research, examines Cooper’s proposal and discusses a curious double standard about private companies profiting from public education. North Carolina state government has been dealing with budget surpluses in recent years. But State Treasurer Dale Folwell is highlighting a long-term budget challenge. Folwell says unfunded liabilities for state retiree pension and health benefits will consume billions of dollars from the budget in the coming years. Folwell wants to see structural changes that will help North Carolina deal with those costs. The UNC system’s Board of Governors recently heard advice from the head of the group that offers accreditation to the system’s campuses. Belle Wheelan, president of the Southern Association of Colleges and Schools Commission on Colleges, explained what her group expects from an oversight board. Wheelan urged board members to avoid micromanagement. You’ll hear her comments and BOG reaction. A group called NC MedAssist has provided free medication and health care advocacy to low-income and uninsured North Carolinians since 1997. Board chairman Sidney Bernstein explains NC MedAssist’s goals and explains how the group offers an alternative to programs funded entirely by taxpayers. North Carolina has scrapped more than 1,400 state government rules since adopting a process that requires those rules to face a periodic review. That’s about one out of every eight rules subjected to the review process. Jon Sanders, John Locke Foundation director of regulatory studies, analyzes the latest numbers. Sanders also explains how a proposed legislative change could subject even more rules to extensive scrutiny.

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Cherokee ticker attack from the largest city to the smallest and from the statehouse into the schoolhouse Carolina Journal radio your weekly news magazine discussing North Carolina's most public policy events and issues welcome to Carolina Journal radio at Muskoka during the next hour Donna Martinez that I will explore some major issues affecting our state. North Carolina has been happy to see state budget surpluses in recent years, but the new state treasurer is offering a warning about a long-term budget challenge is linked to government retirees. University of North Carolina has a board of governors oversees the statewide UNC system. The board recently heard some advice about what that oversight means a group called NC med. Assistance worked for 20 years to provide free medication and healthcare advocacy for low income and uninsured North Carolinians, you learn why that will hear an update on efforts to scrap unnecessary state government rules.

Those topics are just ahead. First, Donna Martinez joins us with the Carolina Journal headline as hundreds of thousands of school-age kids are back in a North Carolina classroom or headed there very soon. Gov. Roy Cooper has made a public plea for donations of school supplies. His request comes at the very same time that he and others are criticizing companies that operate public charter schools.

These two stories are related as our next guest, Dr. Terry stoops is the vice president for research. The director of education studies for the John Locke foundation is been following both of these stories carry welcome back. Thank you.

Before we get into these two stories are North Carolina teachers really needing to spend their own money for school supplies or are they doing this just because they want to enhance the classroom. We have a little bit of both, you have teachers that are spending their own money because they need to, but a lot of the time, you have teachers that want to decorate their classroom and so they're going to the classroom supply store and their buying border and their buying and construction paper to make the classrooms look nice. There's no one compelling them to buy things to make their classrooms look nice. In other instances, there are teachers that are buying books and pencils and other items that will be used for classroom instruction. So you see both things happen. The governor wants us all to go buy some supplies and donate them to our local school. Good idea that I is fond of parents are contributing to their local public school.

I mean certainly nothing wrong with them going and buying supplies for those who can buy them for themselves. But what is often missing from this picture is that parents are buying supplies and are spending a lot of money on supplies. The average family spends $114 per child on school supplies and that's only for one child. If you have multiple children obviously are spending a lot more than that. And that's because families whenever you enter into a Walmart store any sort of store like that will see stacks of papers with lists on them on the list contain multiple items that the teachers believe are needed for the classroom are not just talking about pens and pencils were talking about tissues and sometimes food items so it's very expensive for parents to provide these things. I think parents that can afford him, go ahead and and fill out those checklists, but otherwise there's no nothing compelling those parents buying school supplies for the school. We know that within the state operating budget that there is a huge percentage of the operating budget that goes to K-12 education is some of that money for supplies you absolutely assume there's a there's a good amount for supplies but it's not quite clear what supplies are.

It's oh we have the general categories. When we talk about the budget and so what is considered supplies can be any number of different things and so it's not quite clear what types of supplies, schools and teachers are apparently running short of, or the ones supplies and schools are providing is supposed stop providing so you know there's a lot of questions when you look at those budget numbers about what kind of supplies are actually being used and what kind of supplies need to be Terry you have been writing about some comments made by folks on the left side of the spectrum, who been very critical in these comments of some of the operators of public charter schools tell us what the argument is and why this really catch your attention more than usual. This comes down to the question of who can make a profit off of public schools who is who gets a pass, and who is getting blamed for making a profit from public schools, so here's what happens. A charter management company will come in and operate help operate a charter school, and in exchange for those services.

The charter school will pay that charter school management company or organization and yes they can make a small profit from it.

That's the part that a lot of the left objects to that there are charter management companies that help run charter schools to make a small profit and is a very small profit off of running charter schools, but they will say nothing when a computer giant comes into a school and sells them thousands of computers at a profit, or when a school supply company comes into a district and provides them copy paper and makes a large profit socially. This double standards.

The left has with who can and can't make a profit off of public schools and forcing alike charter schools so they're the ones that always get blamed for making a profit off of public schools when in reality these other kind of companies. The computer companies. The supply companies are making billions. I also wonder about the deconstruction of a public school.

I don't think we have a state agency to build schools do not get that way but yes everything that goes into a school it's for profit contractors using for-profit companies to buy materials and you start thinking about the classroom. The desks, the blackboards of the books and then you look outside you see buses and fuel and all the items that go into making a school work. Most of those items are purchased from for-profit companies. The only person that really doesn't make a profit is the personnel and that's the case in any sort of business or enterprise and yet the comments that are made at rallies and and things like that from folks are on the left side of the spectrum are very effective. There are many people who will shout back or hold a placard and say that's right we shouldn't be making money off of our kids, but is there a rational discussion to be had at this point on, something like that. I think that there is, but I don't see it happening just because it's been such an effective talking point for the left to talk about these for-profit charter schools, and it gets that knot in your stomach when you think of someone making a profit off of kids. What long before we have charter schools. We had companies making profit off of kids and this is really the important point that we need to come together and ask ourselves why is there a double standard. Why can some make a profit off of public schools and other canned others can't.

And why are we pinpointing one and not the other. Why are public charter schools unpopular in some quarters.

They are part of the public school system. Well, it's because they have flexibility to be able to do things that are traditional public school can't and because it's not run by a school board and not really subject to much of the governance that comes down from the state and federal bureaucracy. And so they like to be have as much control the institutions possible.

What charter schools do is they read decoupled the school from the traditional ways of management for school, which is the school board. The state Board of Education on the in the bureaucracy and they really just like that.

Plus they dislike that they're so popular that people are flocking to them because they don't really want to give parents choice don't really want kids have a choice. They believe that they all should go to the public school of their design are charter schools held accountable for how their students perform absolutely.

They take state tests and so that means a lot of charter schools actually end up using the state curriculum so we know how charter schools are to perform and in fact the beginning of September the state test scores are going to come out so will have the state announcing how students did for the 2016, 17 school year we really have no indication at this point how the students are going to do with graduation rates, but more importantly will get that comparison between charter schools and district schools because in the past. Charter schools outperform district schools and I expect the same to happen this year Cemetery windows progressive activists who don't like the concept of charter schools say well it's because they get public money and then they aren't held accountable any validity to that at all. Absolutely not there held accountable not only by the state, but by the parents who choose them, and if parents choose not to send their children there that will schools shut down for lack of funds or if they don't perform up to state standards the state Board of Education will close it. That is real accountability you don't have that kind of accountability in the traditional system. A school can fail year after year and still exist. We been talking with Dr. Terry stoops. He is the John Locke foundation's vice president for research. Thank you. Say with as much more Carolina journal radio to come in just a moment government plays a key role in your life affecting your paycheck the way you educate your kids the way you do business. How can you tell if government is doing a good job making the right choices. Spending tax dollars wisely.

Carolina journal.com tackles those questions every day. The John Locke foundation publishes Carolina journal in print each month and on the web each day@carolinajournal.com you'll find exclusive investigative reports on topics. No one else is covering what else a rundown of the best new stories, editorials and opinion columns in North Carolina.

John Hood's daily Journal news stories and important public events@carolinajournal.tv and the voices of the newsmakers themselves. Carolina journal radio in print on the air and on the web. You can find the information you need@carolinajournal.com welcome back to Carolina journal radio why Michiko got North Carolina has made plenty of promises over the years promises to state employees, teachers, law enforcement officers, firefighters, and many others. Regarding the state pension and healthcare plans will those promises have a price joining us now to discuss that price is Dale Falwell North Carolina State Treas. Thanks for joining us. Thank you for having me.

These are some promises that go back many many decades.

Our day. They are, and it's very important as we go through the next few minutes to differentiate with your listeners.

The difference between the pension promises in the healthcare promises book there's one thing that overrides both of those topics and that is the these are invisible things you people things that people don't wake up and think about every day, but we are at a mathematical point in our state's history where the things that people do wake up thinking about for example roads in education and public safety in the solution.

The Portsmouth state parks.

This will be negatively impacting them over the next two decades. Why is that the reason is is that the state pension in the health plan are going to consume over $4 billion of the annual state budget every year for the next 15 years that's before debt service us before any of the other core functions of state government. The reason is twofold. On the pension plan. It's the result of lower interest rates, which is resulted in the pension plan not earning its required rate of return on average the last 15 years. It's also associated with the blessedness of expected of increased life expectancies which the pension plan never anticipated on the health plan is the result of firm for decades and decades.

We were we are and still continue to be on a Prego basis. Where no money was ever put aside for people to be eligible for lifetime healthcare and now that bills coming due in a very rapid way. In some respects, it sounds as if North Carolina is facing at the state level. Some of the same challenges the federal government is facing with wings like Social Security and Medicare. All of these promises building up over time and now this. Bills coming due right but the difference in the in this topic and the federal topic is that they don't have Gatsby standards that they have to live under. They don't have sort of what we call First, the audited financial statements. The accounting standards Board are requiring not only the state but for your listeners. Every county every city, every school district. Every governmental entity is now going to have to account for these long-term invisible liabilities going forward.

Plus, we can't print money and run deficits. Gambling, yes I did want to bring up the bond glimpsed the office because those are both very true, so setting out that issue and how much the these obligations are going to cost what is it that that that you're trying to bring the attention of policymakers about what we need to be doing to address these things well number one is that were trying to get to the bottom of it.

And sometimes when you think you're at the bottom of something you're really not. And obviously that's what I'm finding out at the treasurer's office. The second thing is is that we didn't do these things I've been working on this for 10 years so I feel like I have some ownership in discovering them. But now I have the responsibility of fixing them, and that's a that's a that's a tall order.

What were trying to do is were trying to reduce complexity and build value on the start of the pension plan. We have 175 money managers managing 360 different phones charging us over $600 million in fees every year.

So were trying to reduce the complexity by making sure that if were paying somebody to actively manage our pension plan that were getting value over and above what we could get if we were in an index file which cost nearly nothing on the state health plan. I think we have enough time this interview to talk about how I'm reducing complexity and billing value, but there there's there's one tragedy in all this and is a strong word to use on a financial topic that is absolutely true. We have prison guards and beginning troopers and teachers. Another beginning state employees who, if they choose family coverage this year had to work five days out of work month just to pay the family premium. Now I say tragedy because the largest purchaser of healthcare. North Carolina is the state health plan and the fact that we can do it better more efficiently on behalf of beginning teachers, troopers and state employees to me is a tragedy and mathematically it's the reason we have problems in our system because it's made up of people my age and above who just take the individual coverage so we have literally driven out away all of our young healthy people of the state health plan so it's made up of people like me and my point of telling you that is working to reverse that and so were don't do that by reduce complexity and building value. We are chatting with Dale Falwell who is North Carolina's state treasurer you been raising these issues since before your days as treasury when you were a member of the Gen. assembly. Also during your work for the poor administration to get the sense that that enough people who are in positions to make decisions about these things, realize this, but this is a problem you want to do something about it or do we really need to sound the alarm bell to a greater extent.

I am very satisfied that that these issues are current top of brain and top of mind for for all elected officials. Not only this statement. Other states. These new accounting standards are for putting biblically speaking, or putting light on the subject.

So number one, number two, I got a very, very careful to always say that our pension plans.

One of the best funded United States, but our pensioners keep a big power with how well-funded something is that the payment cash and so how well I want to make sure it's 100% funded because I'm the key for the public purse. Secondly, Arab eyes as his eyes glaze over will start on the $42 billion unfunded healthcare liability are soon ready to return, but these things manifest itself because it the funding for these two programs then thereby become competition for funding for other things that people think about is a core function of the state government. All were trying to do is figure out what Troy get it right and keep her right and that's my job as the keeper of the public purse. We are good have time to get into the details of this but I understand one of the complicating factors in trying to make positive changes. Here is there are a number of court orders that have come out over the years that basically say North Carolina government. You can do this but you can't do this in this cut ties the hands of it has but yours is the keeper the public purse of I've applied for this job in this very important media_the word apply because too often people run for public office, and they put one thing on your job application and then when I go to do the job they do something different. I've applied for the job to be the keeper. The public person you know with that comes the responsibility to to be honest with the people of North Carolina because inside this person's mind that wants to Republicans, independence Democrats, people from the east, and people from the West, so the. The court cases obviously are having a big impact on on us but but it does not deter me from figuring out what's right. Getting it right and keeping it right and that's what I intend to do for as long as I'm treasurer North Carolina in the very brief time we have remaining. If North Carolina does nothing about these issues, we just sat back and said oh work itself out.

We don't need to take any special action.

What would be the negative consequences. The negative consequences is that our AAA bond rating would be more in jeopardy it's it's were now one of 12 states that have a AAA bond rating while me just lost its AAA and one fourth one. The rating agencies, and regardless of what political party or member of the fact is, when we are able to borrow money at lower interest rates. That's more classrooms us more asphalt. That's more crap that's more everything will be no one person is going to be watching this issue very closely during his term as state treasurer is still follow. Thanks much for doing this. Thank you for having me in enlightening the people will have more Carolina journal radio full-color throughout every issue more visual storytelling. We've revamped Carolina journal to make it easier to read a new look and a new feel. But one thing hasn't changed and it never will.

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Read the monthly print edition of Carolina journal.

Then check in several times a day, Carolina journal.com that's where you'll find fresh stories, opinion pieces and updates on government politics and your money. Carolina journal. We hold government accountable to you. North Carolina is changing not just day-to-day but outward to our minute to minute.

Even 2nd to 2nd, how can you keep up with the changes, especially the ones that affect you, your family, your home, your job, make the John lock foundation and Carolina journal part of your social media diet on Facebook like the John Locke foundation like Carolina. Journal follow us on Twitter at John Locke in the sea and at Carolina journal news, insights and analysis you'll find nowhere else.

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It's the same Amazon you know same products same prices is much better. Amazon donates .5% of the price of your eligible purchases to pass the John Locke foundation to try and be sure to designate the Locke foundation is a nonprofit, you want to support. It's that easy. So now not only will you enjoy what you buy. You'll also support freedom. Don't forget log on to smile.amazon.com today by something nice and help defend freedom. Support the John Locke foundation. Welcome back Carolina journal radio amateur co-kind of board of governors oversees the University of North Carolina system. But what does oversight mean Bill Whelen heads up the regional accreditation group that deals with southeastern universities. She offered the UNC board. A recent presentation. There are three things that we ask boards to do. We ask you to make policy not to administer policy but to make policy to put a policy in place for what you want to see done.

We ask that you hire, evaluate, and if necessary fire the CEO and we ask you to have fiduciary responsibility for the institutions that is all. When boards start micromanaging its use you stepping out of your lane and it gets my attention and then I have to come back in a different capacity. Okay, I have been a board member is tough as nails to sit back and let somebody else decide how to do something when you know that you can do it differently and better.

I understand that but I'm hopeful that you have full-time jobs or some else to keep you busy that you don't feel the need to do that. What the rules say about academic freedom. I tell faculty all the time. This does not mean that you can say anything you want to say that is not what academic freedom is, but it does mean that you may disagree with something that a faculty member is teaching in their course because they are the faculty and you hired them as a subject area expert again unless you have a policy that precludes it, then you have to live with it. Board member Marty Cota's offered a word of caution about academic freedom is a fine line. I think between freedom and religious persecution out there.

The we need to be mindful of and there's an opportunity for professors to over stop and take away rights from others. So I think there's this line out there again that sometimes happens in free-speech overall where you may have rights I may have rights but there's this balance out. There is one side or the other. Curtis also asked Whelen how she's addressed faculty complaints about the UNC board. I did get a letter from faculty Senate collectively from your institutions and I asked them to please let me come make this presentation to you first because I was not convinced that you all were familiar enough with who we are to understand what requirements we have that directly impact the board.

There were some things over which I have no control because I don't accredit legislators, our legislatures, and the other things that the governor and the legislature did that.

You know, didn't have any choice over, things so I've not done anything with those complaints yet, other than come here today.

That's Bill Whelen of the accreditation group that oversees the UNC system schools. She recently offered a list of do's and don'ts to the systems board of governors will return with more Carolina journal radio in a moment real influence. You either have it or you don't and at the John Locke foundation. We do, and that's not bluster in a private survey of more than 250 North Carolina political insiders 87% said we influence them either a great deal a good amount. So while others talk and complain.

We get to work providing research solutions and help our team analyzes the pressing issues of the day jobs, healthcare, education, and more. We look for effective ways to give you more freedom, more options, more control. Our goal is to transform North Carolina into a growing, thriving economic powerhouse that is the envy of every other state. Our research is actually help policymakers make decisions and ensure you keep more of what you earn. Expand your choice of schools for your kids. Widen your job opportunities and improve your access to doctors. The recipe for stability and a bright future. The John Locke foundation were dedicated to making North Carolina first and freedom were dedicated to you will get back to Carolina journal radio amateur co-guy since 1997 a group called C med assist has worked to provide free prescription medications healthcare advocacy and related educational services to low income and uninsured North Carolinians joining us to discuss and C med assist is its board chair Sid Bernstein thanks for joining us. Thanks and very happy to be here and appreciate your talk with you to tell us. I gave a very brief description. But what is that the main intention and goal of NC medicines.

There are two really mean goals. One is to work with uninsured North Carolinians, of which there were about 500,000 about 84% of our patients are working poor, which means that there are at 100% or below the federal poverty level and along with providing free medication. We are interested in creating cost avoidance for the state of North Carolina. So every dollar that we provided medication contributes probably another dollar and cost avoidance of by cost avoidance referring to decrease in emergency room visits, decreases in hospitalization, keeping people off the.

The welfare rolls, unemployment, etc. etc. so we work every humanitarian mission, both for the patients who received the free medications, and for the taxpayers you mentioned the cost avoidance for state government, and I would imagine that that is one of the first things that caught people's interest is there listening to us because they think okay uninsured people, low income people. This is probably a program that has something to do with government.

But what you're talking about is something that's outside of the government programs the ones that are costing taxpayers.

That's correct. It's a completely private not-for-profit, we do receive grants from the state of North Carolina and Mecklenburg County and but most of our funding comes from private foundations and individuals. So it is a nongovernmental institution. We partner I should say collaborate really with the pharmaceutical industry which is the provider the principal provider of the free medications in the current fiscal year which will end in the end of this week will of provided about $42 million in free medications to 15,000 N. Carolinians. How does it work coming we know how government programs work. Someone goes to their local Department of Social Services. They sign up for program and if they're eligible they get assistance.

How would someone get involved with NC medicines very often they're coming in through the 101 free clinics that are located throughout the state of North Carolina to provide medical care, medical attention to the uninsured. We collaborate with them and they actually act as a port of entry. Make us aware of their patients. Then the patients do go through qualification enrollment process.

Those standards are really established by the pharmaceutical industry which provides the bulk of her medication and they must be basically uninsured. So we have to verify that the furniture that they don't qualify for Medicare or Medicaid that their income is is 200% or below the federal poverty level and that that valve that's validated. The one thing that we don't do or not able to do and shouldn't say we don't do we like to do it is we really can't validate the authenticity of Social Security numbers, so there are probably a number of illegal aliens that slipped through the cracks, but I would say the vast majority probably greater than 95% of our patients or our citizens qualify for the services that we provide, and most of them as you were saying access the say start off going to a free clinic. Yes, you find about out about then they find out about that crisis were speaking with Sid Bernstein was board chair for NC med assist some people might be listening to us and saying why have this program is the government taking care of. This is our art, our tax dollars already going to this. Why is important have something like this. That is a private, not-for-profit, alternative it really speaks to the issue of the inefficiency of government meeting the needs of this society and the culture and individuals. We we do this because they North Carolina. There are 500,000 uninsured North Carolinians who are not qualify for Medicaid or they do not qualify for Medicare. They certainly are poor cannot afford private insurance so they fall outside of the safety net were basically safety net to the safety net and in and in so doing, because this is not going through government are there some efficiencies that we see with NC medicines that we would not normally see with that with a government program.

Absolutely, we operate with a budget of about $2.7 million this year and probably closer to three without $3 million. Employing a staff of 25 people were able to distribute 41, $42 million in free prescription medications. Another 2 million in over-the-counter medications. I should mention there as well that with over-the-counter meds like Tylenol, Robitussin, diuretics and things like that are anti-diuretics. Actually, we provide six dollars and cost avoidance because very often those simple easy to treat medications keep people out of the ER, which is the probably the most expensive place to receive medical care so the the efficiency really is that on a $2.7 million budget $42 million in free prescription meds $2 million in over-the-counter meds and $56 million in cost avoidance. You mentioned just, and alluded to it earlier, but we see some positive health outcomes from from having this type of arrangement as compared to the standard government way of doing this interestingly many patients that are Medicaid recipients have health outcomes that are really not better than someone who's uninsured.

Our patients self-report and this is hard to validate that their compliance to the medication is 97% and that there are now able to buy food and have their medicine very often.

It's a choice.

One or the other. So the overall outcomes simply are the people are able to maintain their jobs, are able to provide for their families, albeit to a limited degree, and essential stealth welfare rolls in the limited time that we have left you mentioned that this is does have a couple of grants from government agencies but is primarily philanthropic. Yes, why do people who support the organization. See, this is a valuable use of their resources.

I think exactly that there probably two main reasons.

The Shirley humanitarian component that's very very important to many people. And very often the cost benefit. The fact that we are saving the state of North Carolina money and taking care of a nest of a needy population so those with the two primary motivators. While certainly a very interesting program NC med assist. It's been around since 1997, and as we just learned helping save the state taxpayers by serving a function for low income and uninsured North Carolinians who otherwise art served. The chairman of the board of NC med assist his Sid Bernstein. Thanks much for joining us very happy to be here. Thank you moron Carolina Journal if you love freedom we got great news to share with you now. You can find the latest news, views, and research from conservative groups all across the state. All in one place North Carolina conservative.com one-stop shopping for North Carolina St. movement had North Carolina conservative.com. You'll find links to John Locke foundation blogs on the days news Carolina Journal.com reporting and quick takes Carolina Journal radio interviews TV interviews featuring CJ reporters and Locke foundation analyst plus opinion pieces and reports on higher education.

All of that from the Pope Center for higher education policy commentary and polling data from the Cintas Institute and news and views from the North Carolina family policy Council. That's right, all of that, all in one place North Carolina conservative.com that's North Carolina spelled out conservative.com North Carolina conservative.com. Log on today. Welcome back to Carolina Journal radio and Donna Martinez too much bureaucratic red tape to many onerous rules. It's not an empty complaint from North Carolina business owners and any North Carolinians actually tried to navigate state government. In fact, in North Carolina there are an estimated 22,500 state rules. It's a number so high that it got the attention of state legislators in 2013.

That's when they began an effort to actually clean up this maze of rules. John Sanders is the director of regulatory studies for the John Locke foundation. He follows this issue very closely and is here to give us an update. John welcome back. Next, who would be impacted by one of these 22,500 rules, businesses, individuals, nonprofits, pretty much everyone across North Carolina. Depending on what field therein pendant contractors.

People who are doing people who are setting themselves up as self-employment going into business for themselves. Even in people might be surprised if they're just trying to transact business in the state or apply for a license or do something like that that there typically would be some sort of paperwork or rule or regulation that they have to comply with they may not even know it.

Probably not.

In some cases, now back in 2013. As I mentioned them state legislators really decided that they wanted to take a look at all of this because 22,500 is a pretty high number I what were they concerned about John when they decided to look at this. It was part of an ongoing effort that still ongoing. Cutting out regulations and red tape. It was one of the more important reforms, sunset provisions, with periodic review of basically what that is, every time a new regulation is promulgated by an agency by an executive state agency.

It has to come up for review within 10 years or it automatically sunsets and the way that the reviews work is the agency can determine what we really don't need this rule anymore so it's called unnecessary, and it's immediately repealed or they would say it's necessary, and then see if they take any public comment on it. There would be a public comment.

So if they receive comments that are on point, you know, instead of someone just kind of waving a cane and saying I don't like it then it would be necessary if they got a comment on it will be necessary with substantive comment and they would have to that those rules would have to go back through the rulemaking process as if it were a new rule and if no one said anything about it, and the agency called unnecessary. It would immediately re-as necessary without substantive public interest. It sounds as if the goal here John would be to make sure that if there is a legitimate need for some sort of a ruler right regulation that it either is instituted as a new rule or it continues to exist, but if something for any reason is unnecessary or that the whole mission.

Her goal was outdated, that I should give it yes and and then happens is talking about how businesses and people don't know some the things that affect them. These rules get lost on some of them just kind of fall through the cracks and in memory over time, and some may have nothing to do with modern waves of doing things. So it's good to pull these things out of the out of the toolshed, sort of, so to speak and dust them off and see if you're still needed. We've got an example that I asked you to bring that to this interview because I wanted to give our listeners a chance just to have some sort of idea about what were talking about here.

There is a rule that has been removed and had to do with drinking water to the Reader's Digest version of that. Basically there's a package of rules that the Department of environmental quality has regarding a federal safe drinking water plan and in the state on the reading through it all. It's you know like a lot of rules. It's quite it's quite involved, but the gist of it is the federal government. Prematurity does it and the state rules are obsolete and there's no need to hold onto them any longer. So they've they have repealed a whole package rules that are duplicative and obsolete. This particular package of rules, then, is among those that you been monitoring that have been cleared from the books. Where are we on that we start out with 22,500 rules.

How many been removed. I just looked at the numbers for August 2017 and were about halfway through the process was done a little over 11,300 some rules and where we are in the process is about 18 them have been repealed. So we've already repealed 1/8 of all the rules of been looked at another about one fourth, 25% have been added to the re-examine through the rulemaking process again so necessary with substantive public interest and then 62% are have been automatically re-upped. John it I think it makes common sense to people that if something is no longer needed that you would wipe it off the books but there are even more involved reasons relating to the economy that we would want to take a look at all these rules and regulations. Every now and then explain the relationship between red tape and rules and prosperity in an economic growth.

The book of economic literature looking into regulations find it. They have a depressive effect on the economy.

They there there basically a deadweight loss on because they require time be spent in satisfying strictures on paperwork things like that. Instead of going to productive endeavors and so there's a trade-off as to whether these are important and whether they are simply simply annoying I guess would be one way of putting it.

So it's always good to take another look at the sorts of things, and in fact some some research by Makeda scholars has found that the sunset provisions with periodic review have a very substantive effect on reducing regulation and also on helping the state's economy.

Unlike a lot of other review processes.

This one actually works and that's an important point because one of the things that you have written very recently is that when the state legislature started looking at this whole question in 2013 they did make their decision just willy-nilly is okay, let's just start looking at all these rules actually went to some research to find out what's the most effective way to do this and this periodic review is an effective way and it seems to be proving up here in North Carolina and that's what I'm encouraged with now.

With that in place we can start doing what I call sunrise provisions and so address the problem. On the other side of it on the rulemaking side of it so that we are putting in the place several good things in that way, and what types of recommendations are you making in that area will one would be sort of a rain Zach for North Carolina, where if it's an extremely burdensome role that the Gen. assembly has some say over with instead of just granting the executive agency carte blanche to put through there could be have alternatives or a cost-benefit analysis. A strong cost-benefit analysis put through something that the trump administration is doing that is also been done in British Columbia in the UK and having survey of regulatory budget. Where an agency if they want provide a new rule they have to get rid of an ruler to show this week.

Thank you for listening on behalf of Mitch and Donna Martinez come back again next week for another edition of the Carolina Journal radio Carolina Journal radio is a program about the job lot to learn more about the John Locke foundation, including donations that support programs like Carolina Journal radio send email to development John Locke done.

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