It's 5.05 and welcome in to a Friday edition of the Carolina Journal News Out right here on Charlotte's FM News Talk 107.9 FM, WBT. I'm Nick Craig. Good morning to you. For those that are close observers of North Carolina politics, you are likely familiar with an ongoing battle that has taken place between groups and the North Carolina legislature over funding for public education. This has been an ongoing legal challenge in a variety of different matters going all the way back 32 years.
We finally have a conclusion in the case that is called Leandro to walk us through some of those details this morning. Mitch Kokai from the John Locke Foundation joins us on the Carolina Journal News Hour. Mitch, you always talk about how long you've been following North Carolina politics. This one goes pretty far back, probably to some of your early starts in North Carolina media. Yeah.
Yes, this suit was filed when I was really in my earliest days in the North Carolina media. I got back to North Carolina in the fall of 1993, and this suit started in 1994. You mentioned ongoing, and now it's ongoing no more because the decision from the state Supreme Court basically ends the case and dismissed it with prejudice, meaning that it can't be re-filed again. This is a long-involved saga that started in 1994 with five low-wealth school systems and families associated with those school systems suing the state to get more funding for education. And over the course of three decades, the case took all kinds of twists and turns.
It's been to the state Supreme Court multiple times, and it was at last at the state Supreme Court more than two years ago. If the math from Justice Allison Riggs is correct, it was 771 days between the time of the oral argument. And the decision in this case. And what happened is, with a 4-3 decision, the state Supreme Court shut down the Leandro case. An interesting ruling supported by three of the seven justices.
Four of the seven supported the result. Three of the seven supported the lead opinion from Chief Justice Paul Newby. And it basically said that anything that happened in this case after July of 2017 was basically null and void. It was at that point that the Attorney General of North Carolina, then Josh Stein, now our governor, wrote a brief saying that the case had been transformed from its original case into a much different case. And the majority on the state Supreme Court agreed and said, yes, it is.
And the parties in the case didn't take the steps they would need to take to move forward with the case as it stood in 2017. And thus, everything that happened in the case afterward has to be thrown out. Practically what that means is the court throws out An order from 2023 that said that North Carolina would have to spend another $677 million on education programs with the prospect of potentially billions of dollars more tied to this Leandro plan that came out in 2018, 2019 from a San Francisco consultant called WestEd.
So that's the practical implication. Where we go from here, Is a matter of debate. I mentioned that three of the seven justices supported the lead opinion. The fourth Republican who was in the majority, Phil Berger Jr., agreed with the result. He said, yes, the case should be ended.
Everything that's happened since 2017 should be thrown out. But he would not sign on to Chief Justice Newby's opinion because Berger said it didn't include something it should have, and that is a language that specifically said what the state Supreme Court said in 2022 about Leandro is disavowed and cannot stand in the future. Berger predicted that if the 2022 language from the last Leandro ruling was allowed to stand, that means a bunch of other education-related lawsuits are going to come forward, and the people filing them will rely on the language of the 2022 Leandro ruling, which basically said that courts could. Order the state to spend additional money on education.
So that was one reason why you had a split. Another reason for the split, the two Democrats in the court both dissented, as did one of the Republican justices, Richard Dietz. Dietz did not want to end the case and throw it out. He basically said, look, this case can be resolved. We'd need to do some tweaks.
We'd need to change some things to deal with some of the things that previous courts have got wrong. But Dietz wanted this case to end up playing out in a different way. And for that reason, he dissented. Mitch, I want to read through part of the majority opinion in this because it gets back to maybe a larger discussion that we've had on a variety of different issues. It reads, the people did not vest the judicial branch with the power to resolve policy disputes between the other branches of government or set education policy.
Ending a quote there directly from the three that you just mentioned in that majority ruling. To me, that's really what this case boiled down to is does a court system, in this case, whether it's the appellate court or now the Supreme Court or any other courts in between, do they have the authority to compel the North Carolina General Assembly, who has the ability and does, as we see, well, maybe not this year, pass a budget and spend money on things, do they have the ability to compel them to spend X number of dollars? And according to that 4-3 decision, they do not. Yeah, and there are a couple of pieces to that to get into. One of them is compelling the General Assembly.
And courts have in the past compelled the General Assembly to spend money on this or that, but then Things end with that order. The court says, you must spend this. And if the General Assembly agrees, it'll do it. If the General Assembly doesn't agree, it'll say, Okay, thanks for that order. We're going to do what we're going to do anyway.
One thing that had come out of Leandrew that was especially disturbing to people who are interested in the constitutional separation of powers is that a lower court and the old Supreme Court ruling basically suggested that not only could a court order the money to be spent, but then it could bypass the General Assembly and order state executive branch officials, the head of the Office of Budget and Management, the Comptroller, and the Treasurer, order them to move the money without any authorization from the General Assembly. That prompted a legal challenge from the state controller. And by ending the case, that legal challenge ends as well.
So, yes, basically, one of the things that the majority said is this is the type of debate that belongs in the political branches, especially the General Assembly, but also a role for the governor to make some recommendations about the budget and to. Complain and cajole the General Assembly if they don't do what he wants to do. But it's not really the court's role to say that the state needs to spend this or that amount of money on this or that education program. That that is not what the court is supposed to do. And now after 32 years, the court is finally saying we're going to be done with it.
One of the interesting things in the dissent, especially the dissent from Allison Riggs, was this notion that perhaps this is a sign to voters that if they're concerned about this issue, that they should elect a new state Supreme Court. She didn't come out and say it exactly that way, but basically suggested that if voters don't like what they see from this Leandro ruling, they definitely have to have a way to deal with it. They'd have to think about it for a while because the only seat on the state Supreme Court that is up for grabs this year is one held by one of the dissenters, the other dissenter, Anita Earls. But of course, All of the rest of the justices are, in fact, up for election at some point, and at least three of their seats, now held by Republicans, will be up for grabs in 2028. Yeah, great point in the dissent there.
Mitch, you mentioned something a couple of minutes ago I want to dive back into. You talked about how this case has morphed. And I think that's an important kind of backstory to all of this as you led in with your setup. This was originally filed against one and then a couple of other small school districts in North Carolina, again, trying to compel the North Carolina General Assembly to spend some more money on public education. But this has really morphed into a statewide discussion where now every single school district, in one way or the other, and definitely for political activist groups on the left, they have run around school board meetings now, Mitch, for the last decade talking about how Leandro needs to go forward.
The General Assembly is starving public education of the money that it is required to give in the state constitution. This is no longer just a couple of rural school districts. This is a major education political battle taking place in the Tarheel State. Trevor Burrus, Jr.: Yes, and that's one of the things that has been a downside of Leandro is that it has become a talking point where folks who are advocates of more education spending, most of them on the political left, have said, fully fund Leandro, fully fund Leandro. And they don't always know exactly what they're talking about because I remember one of the last news conferences that was related to this was spend the $1.75 billion that the judge called for on Leandro.
Well, that's an outdated number. More than a billion of that was already funded in the last state budget.
So the actual number that a judge had compelled that had not been funded was $677 million, far less than the $1.75 billion. But beyond just the basic numbers, those who have been saying fully fund Leandro. Basically, I think their idea is the General Assembly isn't spending enough. Leandro would tell them to spend more, so let's support it. But they really haven't gotten into the details of what this Leandro spending plan is all about.
The fact that the plan from which this extra spending comes from was written before COVID and it is well out of date. In fact, it was done as an eight-year plan. We're almost near the end of the eight years.
So even if they got the funding, we would be almost past the end of the plan. And so what happens then after that runs out? All of those questions have been out there. And going back to a point you made just a while ago, this started with some. Families.
And some low-wealth school districts, five of them. And then some larger school systems got involved very early on. And the cases had made multiple trips to the state Supreme Court, but very important: the first Leandro ruling in 1997, and then the second ruling, which some refer to as Leandro II and others as Hope County I, depending on which side of the political divide you're on. Both of those cases were, the rulings from the state Supreme Court were very careful not to order new spending. They dealt with whether the state was meeting its constitutional obligations, but they didn't say.
Now you got to have to you have to spend more money. Basically, the idea was the state needs to meet these obligations, but it didn't say that that translated into spending more money. And as the case morphed, The advocates who looked back at these earlier rulings were trying to suggest that they meant spending more money when if you looked at those actual rulings, they did not and were very clearly not calling for more money. They were just calling for the state to meet its obligations. We'll continue the conversation on the Leandro legal challenge as it relates to public education funding coming up after this.
You're listening to the Carolina Journal News Hour. Uh It's 21 minutes past the hour. Welcome back to the Carolina Journal News Hour, Charlotte's FM News Talk, 107.9 FM, WBT. We are talking about a major decision out of the North Carolina Supreme Court, a 4-3 ruling tossing the Leandro public education funding case. Mitch Kokai with the John Locke Foundation continues with details.
Mitch, let me ask you a political question on this because it is, of course, obviously a very political issue. We've seen this play out with things like opportunity scholarships and a lot of education policy over the last dozen or so years here in North Carolina. This has become, as you mentioned, kind of a much larger talking point, particularly those on the political left claiming that the Republican-led General Assembly is not meeting the constitutional requirement of providing a basic sound education. Mitch, I've often seen individuals that are against this Leandro case saying, well, hey, Democrats, prior to 2010, you guys were in control of the North Carolina General Assembly. This court case, as you know, goes all the way back to 1993.
Why was Leandro not funded in the 15 plus years that you were controlling the North Carolina General Assembly and the governor's mansion? Yeah, the first 16 years of this case basically were taking place while Democrats were in control. And one of the things that happened was that after the initial ruling from the state Supreme Court on Leandrew in 1997, the case went back to a trial judge, Howard Manning, who then spent. A couple of decades basically calling education bureaucrats. Headed up by Democrats in the Department of Public Instruction and berating them for not dealing with the Leandro issues.
And so this has not been a case that's been all about Republicans don't want to spend enough money on education. The case started with concerns about legislature that was led by Democrats not funding the state adequately. And then Republicans took over the case and I think took over the General Assembly. And I think when they first did, they weren't too worried about Leandro because it was basically still a case of one judge calling in some education bureaucrats and reading the Nariot Act every once in a while. The Republican General Assembly really got involved in this case once it turned out that there was this Leandro plan that they had nothing to do with, and then that the courts were going to say that the state would spend money without the General Assembly having any input.
That's when they stepped in and said, whoa, wait a minute, this is not something that. We're going to sit by and allow to happen. The other thing that I think is worth mentioning from your point about the politics of this is we saw. I believe it was last year that the State Board of Education came up with a new major education plan. And that to me signaled that perhaps they realized they weren't going to get what they wanted from Leandro.
And so they needed to look elsewhere. And then one of the things that Chief Justice Paul Newby mentioned near the end of the more than 100 pages that he wrote about this topic and his major lead opinion is that there's a new Blue Ribbon Commission on Education, Governor Stein, the legislative leaders. And basically, Newby said, now that this is back with the political branches where it belongs, we can all hope they will come up with a good plan to deal with education. It's something that the legislature and the governor should be dealing with, not something for the courts to deal with. Mitch, I've got a question for you that I think some of our audience probably has this morning as well.
You mentioned that this case originally filed all the way back in the early 90s, the first ruling on it in 1997. Mitch, how does a court case like this in various forms go on for 32 years? How is something like that even possible?
Well, the main reason and the simple answer is because no one stopped it. I mean, the state Supreme Court has stopped it now and could have in the past. I mean, one of the things that has cropped up from this ruling is the idea that anything that's happened in this case since 2017 shouldn't have happened because the case morphed from one challenge to another type of challenge, and the courts let it happen, and all of the players in the debate let it happen as well. Part of that. Being because the plaintiffs and then eventually some of the defendants kind of were on the same side, that they wanted the courts.
To order more spending because then, if you were the plaintiffs, you got the more spending that you wanted. If you were the defendants, you could say, Well, you know, our hands are tied, we've got to do this because the courts have told us we have to do this. And so, there was a sense that even though This could have been shut down long ago. There were some people involved in this case who really had a reason to want it to continue.
Now, I think one of the things that happened that allowed this to go forward was the original ruling that came down in 1997 from the state Supreme Court basically said that there is a state constitutional right for the opportunity to access a sound basic education. And then it sent it back to a trial court to sort of deal with that pronouncement. And then it was up to Judge Howard Manning to decide what to do. He held the trial in Hope County, which is the only trial that's been ever held in this case. He issued an order about what to do after that trial.
It went back to the state Supreme Court. The state Supreme Court agreed with a lot of what Judge Manning said, but they threw out his order for mandatory pre-kindergarten. But then they didn't end the case there either. They basically sent it back and said, all right, well, you got some of it right, some of it wrong. And then they allowed Judge Manning to continue doing what he was going to do, calling in the education bureaucrats and sort of berating them every few months or so.
And the courts could have stepped in and said, okay, this case is done. This is not an active controversy anymore. We're basically just allowing politics to enter into this rather than treating it as a legal issue. But they didn't. They basically allowed this case to continue to move forward.
And not until the General Assembly stepped in and said, wait a minute, the courts don't have subject matter jurisdiction, did anyone really put forward this idea that this case had gone on too long and needed to end? You mentioned earlier that this has now been tossed out, dismissed by the North Carolina Supreme Court in that 4-3 decision with prejudice.
So as I understand that, Mitch, there will not be allowed to be another legal challenge. I guess specifically looking at this constitutional obligation as it relates to the sound basic education and the money that the General Assembly is spending on that. Because again, this is such a broad case and there's so many different opinions on it. How exactly does a prejudice work in something like this?
Well, this particular complaint ends. That's what it means.
So the Leandro plaintiffs can't. File a case basically asking for what they originally asked for, or even really what they've been asking for in recent years once the case morphed. But that does not mean an end to education lawsuits. And in fact, I mentioned that Phil Berger Jr. did not want to sign on to the opinion that the other three Republicans in the majority signed on to because he was concerned that there could be a whole rash of education lawsuits that basically try to use the reasoning.
that the previous Democrat majority state Supreme Court had in 2022 when they said that the courts could force more funding on education. And so Phil Berger Jr., in his concurrence, warned that there could be a whole rash of lawsuits dealing with this same issue that rely on what the state Supreme Court said in 2022. And Berger said that he would have signed on to the opinion that the rest of the Republicans in that 4-3 majority signed on to if it had said, we're going to say that everything since 2017 is void and we expressly disavow what this court said in 2022. Since they didn't do that, there's a possibility that you could have a number of other suits that say that there's not been enough education spending and the courts should force the state to spend more money. Fascinating that something like this goes on as long as it did.
I guess maybe Mitch, we'll wait and see if another legal challenge comes forward, and we'll talk about it in about 25 or 30 years, and we'll keep you up to date with all of that. We've got a lot of extensive coverage on this Leandro challenge going back to the early 90s over on our website this morning. CarolinaJournal.com. We really appreciate the information and insight. Mitch Kokai from the John Locke Foundation joins us on the Carolina Journal News Hour.
Ah. It's 5:37. Welcome back to the Carolina Journal News Hour, Charlotte's FM News Talk 107.9 FM, WBT, and some other statewide news. This morning, the Local Government Commission, also known as the LGC, and officials as part of that entity this week, agreed to postpone a potential state takeover of Rocky Mountain, North Carolina's finances. This is contingent on the city complying with specific requirements laid out by the LGC.
The city was recently the subject of a 257-page performance audit released this month by state auditor Dave Bollock in his office. The report said that the lack of oversight and due diligence within the city led to serious financial distress, including the mismanagement of millions of dollars. State Treasurer Brad Briner, who oversees the local government commission, said that they have taken Taken over 12 towns out of the state's 1,100 municipalities in the 94 years that the local government commission has existed. And noted that if something like this happens, it is usually because something is in a terminal condition. With Brianer being pretty blunt at the meeting, saying it's usually because a business has moved or a large population base has left and is not going to be fixed.
This is not that. This is simply a failure of will, and we are here to help impose that will today.
So, that to me is the simple punchline. I appreciate the leaders of Rocky Mountain being here, but we need to get to a place where this is where you will fix a very, very serious problem. The audit stated that all of Rocky Mount's financial woes could have been possibly avoided if the city council had vetted its pick for city manager back in 2023. Leading up to that process, the city hired an executive firm and spent $38,000 to recruit the now former city manager without conducting any reference checks. Dave Bollock said, what we found was red flag after red flag, including the fact that he, referring to the previous city manager, had previously been the town manager of Dumfries, Virginia.
And during his time there, we found reoccurring issues of poor management and poor decision making, including a pattern of unqualified IRS questionable salary increases without council approval, inadequate segregation of duties, and structurally unsound budgeting. Those deficiencies in that community ultimately resulted in a $1 million overspend by the city manager. Yet Rocky Mount City Council voted unanimously to hire him. This now former city manager was left unchecked from August of 2023 to August of 2025. For those doing the math at home, that is two full years.
During that time, the city's cash and investment balances declined by approximately $80 million, falling from about $100 million to just over $21 million in the span of 24 months, a 78% drop. At Wednesday's meeting, city officials, including Rocky Mountain Mayor Sandy Robertson, said that they had been making cuts, hired a new financial director, and that the city's monthly reports matched revenue projections. But according to Denise Canada, who is the director of the state and local government commission's finance division and secretary of the local government commission, she said that she was very concerned about the city being able to make its debt service payments and not default on the debt that it currently has outside. standing. She said during the LGC meeting this week, as Treasurer Breiner has said, we have not had a default in 80 years, and it's not going to happen now.
Staff have regularly talked with the city manager and the finance officer since the fall, trying to track the progress, making budget cuts and tracking revenues, and those sorts of things. I had originally believed that things were more or less on track, but then maybe about two months ago, the city raised concerns that they have the potential to run out of cash. Obviously, that is hugely worrisome, and I became much more involved with the city at that time. Rocky Mount officials said that they have and that they had enough funds to get through the rest of the year, but Canada raised questions that the available cash in the general fund for the city continues to decline and will likely be depleted by the month of July.
However, according to the finance director for the city, Cheryl Speevey, she said while that is true, they should return to levels that they were at at June in terms of tax revenue. Officials said that they anticipate a possible tax hike and fee increase, with Robertson stating that the hikes and hiking those rates and expense reductions are, quote, on the table, noting that they have already reduced the number of people on the city's payroll. Elton Daniels is the new city manager and said that they are also looking to increase utilities by about $45 per month, noting that they already have one of the lowest utility charges anywhere in the eastern half of North Carolina. with state treasurer Brad Breiner telling city officials that one of the first things they need to do is get rid of excise assets with Daniels saying that they are looking at doing that and have already eliminated grants to third parties which is a pretty common practice for local government Robertson told the local government commission that city officials quote have seen the light end quote and are ready to move forward with their team that is currently in place noting we have certainly gotten the memo and we certainly understand the serious of seriousness of this i didn't run for mayor to come before y'all and to have this situation that is certainly embarrassing for the city State officials, including state treasurer Brad Breiner, however, remain very skeptical that the current elected body within Rocky Mount has the ability to turn things around. With Breiner saying during the meeting, as Ronald Reagan said, trust but verify.
So I don't think we collectively, and please correct me if anyone thinks differently, feel like we have a lot of trust for the city of Rocky Mount right now. Secretary of State and local government commission member Elaine Marshall, who is one of the longest-serving public officials in North Carolina, stated that she was the longest-serving member of the board and already had a very thick file on Rocky Mount and has continued questions about the culture of the city's finances and arrangements and have asked those questions repeatedly. She also questioned in the past the city's avoidance of getting high-ticket items approved by the local government commission. She also called it a failure of leadership, unfortunately, which she noted could affect the entire state's AAA bond rating if not fixed. State Auditor Dave Bollock, who also sits on the LGC board, said that if Rocky Mount doesn't turn things around, quote, it would certainly be the largest failure of a municipality in the history of the state of North Carolina.
With Bollick, similar to Breiner, being very blunt at the meeting, noting, if the local government commission finds itself in a position Position to have to assume control of the day-to-day finances and management of the city of Rocky Mount. And again, I'm speaking for myself, not this board, but I view that as a failure of the politically elected leadership and layout.
So, if we get to the point that the folks who signed up to run, the council members who signed up to run and put your name on the ballot to make those hard decisions, and the LGC ultimately has to come in and take over, my recommendation and my expectation would be that you would have a mass resignation of city council members because it's not fair to the people who elected folks to represent them and make tough decisions. Very strong commentary there from state auditor Dave Bollock, with Treasurer Brad Breiner noting that this is the most severe-level warning that can be given to a local government unit, with the next step being taking control of the city's finances. The board voted to have the city provide the local government commission with bi-weekly. Reports. And if anything is questionable, if anything looks out of line, if local individuals within the LGC are not happy with what they are getting from Rocky Mount, then a meeting will be convened and the state will likely, or I should more accurately say, the local government commission will take over.
City officials are also being required to come to LGC meetings in both May and June to see what progress has been made. This is a major financial problem unfolding in the city of Rocky Mount. We've got a link to the 257-page performance audit that was released last month by state auditor Dave Bollock's office in the month of March, as well as some of the quotes and details from this very fiery local government commission meeting, LGC meeting that happened on Wednesday of this week. All those details are available this morning over on our website, CarolinaJournal.com. Our friend Teresa Paika's got the headline: LGC delays Rocky Mount Takeover sets conditions.
Conditions for city. Um Good morning again. It's 553. Welcome back to the Carolina Journal News Hour, Charlotte's FM News Talk 107.9. WBT continuing our coverage of a major decision from the North Carolina Supreme Court on Thursday, dismissing the long-running Leandro school funding case.
We talked and went through some of the legal side of it with Mitch Kokai from the John Locke Foundation earlier in the program. We'll now get into what the reaction has been from individuals that support the decision from the North Carolina Supreme Court and those that do not. We'll start off on the supporters of this decision. We'll hear from Donald Bryson, the CEO of the John Locke Foundation, who said, quote, for decades, this case drifted far from its original purpose, evolving into an effort to have courts manage statewide education policy. Today's decision restores constitutional boundaries and reinforces the conversation where it belongs on accountability, resilience, Results and fulfilling the state's duty to guard and maintain every child's right to the privilege of an education.
Republican leaders echoed that same sentiment, noting that the state constitution grants lawmakers sole authority over appropriations or spending. With Senate Leader Phil Berger writing in a statement: For decades, liberal education special interests have improperly tried to hijack North Carolina's constitutional funding process in order to impose their policy preferences via judicial fiat. Today's decision confirms that the proper pathway for policymaking is the legislative process. He went on to say, today North Carolina's children have access to world-class education opportunities because of this legislature's commitment to improving education outcomes. As we prepare for the short session, Senate Republicans will continue our ongoing efforts for increasing parental involvement and educational opportunities for students across the state.
Similar comments also coming in from House Speaker Destin Hall, who said today's decision recognizes the constitutional role of North Carolina's General Assembly since the state constitution entrusts sole appropriation authority to the legislature. House Republicans remain committed to investing in public education, including through our budget proposal to raise starting teacher pay to $50,000 and provide 8.7 percent average raises to our public school teachers. That is what the supporters of this decision have to say, plenty disagreeing and dissenting with that, including Democrat Governor Josh Stein, who said in a statement yesterday. education opens the doors of opportunity for children. But today, the courts slammed them in a slammed them in their face of students who deserve the right to a sound basic public education.
The Supreme Court simply ignored its own established precedent, enabling the North Carolina General Assembly to continue to deprive another generation of North Carolina students of the education promised by our Constitution. In recent years, the General Assembly has dropped North Carolina to 49th in the country in peer-pupil investments and made our teachers among the worst paid in the nation. Four Supreme Court justices believe that that is okay, but they are wrong. Their decision is contrary to the plain language of our Constitution and this Court's past rulings. House Democratic leader Robert Reeves said in a statement as well, for three decades, Republicans and Democrat judges have recognized and attempted to enforce the right to a sound basic education for everyone.
Today, four Republican justices nullified that constitutional right, overruling a bipartisan minority on the court. The children of our state of North Carolina deserve better. We've got more reaction as well. Including from members of the U.S. Congress, Representative Deborah Ross, other members of the North Carolina General Assembly, as well.
All those details over on our website this morning, CarolinaJournal.com. Look for the story with the headline: Leandro supporters, critics respond to the end of 32-year-old case.
Well, that's going to do it for a Friday edition of the Carolina Journal News Hour. WBT News is next, followed by Good Morning, BT. Have a great Easter weekend. We are back with you Monday morning, 5 to 6, right here on Charlotte's FM News Talk, 107.9 WBT.
