And welcome into the Carolina Journal News Hour, Charlotte's FM News Talk 107.9 FM, WBT. I'm Nick Craig. Good morning to you. Continuing our coverage of what has been a very busy week in Raleigh as lawmakers are back in the state capitol dealing with the legislative short session ahead of the July the 4th holiday when lawmakers are scheduled to wrap up the 2026 short session. A lot of legislation moving back and forth between the North Carolina House and Senate to walk us through House Bill 1173.
It's my pleasure to welcome Andrew Pomerance, CarolinaJournal.com to the Carolina Journal News Hour this morning. Andrew, great to have you. As always, a busy couple of days at the legislature. Gang violence is a major problem and discussion in many municipalities across the state of North Carolina. Typically, that is a local issue dealt by local judiciaries and local law enforcement.
However, it looks like the North Carolina general. Assembly is trying to step in on this. What are you tracking on that front? Yeah. Hey, Nick, thank you so much for having me on this morning.
It is a busy week, like you've mentioned, down here in Raleigh at the General Assembly. I'm seeing a number of bills kind of work their way through committees this week. And this is a bill that was filed back on April 30th, so just a couple weeks ago now, entitled Jalaya's Law, sponsored by Representatives John Bell and Sarah Stevens. Actually happened in John Bell's district. And so something that he talked about was, you know, the family actually came to him and said this is something that they would like to see move forward, but moved through House Judiciary II Committee late Wednesday after late Tuesday, I apologize, afternoon.
And something that we'll see was earlier calendar for House rules on Wednesday morning, but was then removed from the calendar.
So something that I think we will see come up early next week. You talked about how the family wanted and reached out to their representative to try and get moving on some legislation. And Andrew, this files a horrific story from late 2025 as a middle schooler in Goldsboro was gunned down and killed. Can you walk us through some of those details? Yeah, so on her way home walking with her little sister, she was gunned down by three fellow juveniles.
Those names have not been released because they are minors, but both, all three boys were teenage boys, were charged with first-degree murder and felony conspiracies. And so, something the family said: you know, she was only 13 years old. Our lives have been changed forever. And, you know, their goal really with this piece of legislation is to save other lives with prevention and intervention. And so a terrible story.
You know, the family talked about how the 13-year-old died in her little sister's arms, you know, on a normal walk home from school. And a lot of the details around this case are still, you know, Not being discussed because of their juvenile status of the boys who committed the crimes. But Representative Bell said this law is the result of a tragic incident that happened in our community where a beloved 13-year-old girl was murdered only four days before Christmas. Nick, I can only imagine the family. And it shocked their community.
It rocked our community, and the whole community in their area grieved. And so a very tragic situation, but the family was in attendance during the committee hearing on Tuesday asking for this legislation, obviously visibly upset and, you know. A br Rightfully so, still. And so they are looking to do something they said in a big way. Yeah, and obviously the legislation does not resolve what had happened in the past, but hopefully helping other families, other parents, other relatives and guardians across the state of North Carolina moving forward.
Andrew, you highlighted something there that I want to make sure is clear to our audience. We cover and have talked about a lot of high-profile violent situations here in North Carolina over the last couple of years, specifically when you are dealing with juveniles throughout the criminal justice and the law enforcement system. Those details can take forever if they ever are released. Again, because of the age of those individuals.
So that may be why this has not become a major topic and wasn't a major story across North Carolina when it happened in late 2025. Yeah, and this story really started to gain momentum again just two weeks ago now. The family and representatives held a press conference actually out in Goldsboro to introduce this bill and ask for it themselves. And a number of representatives were in attendance as well as local officials asking for these stricter gang-related charges and making it easier to prosecute individuals with gang-related crimes. Yeah, there are a lot of pertinent details as it relates to House Bill 1173.
Looking at your article over at CarolinaJournal.com, what are exactly some of those details as it will relate to gang violence? Yeah, so rather than focusing on a single penalty, the bill would actually look at several different aspects of criminal law, including recruitment, gang recruitment, firearm possession, sentencing enhancements, and also just how do we define criminal gang activity in the state of North Carolina? And that's something that was brought up multiple times during the committee hearing. 2008, North Carolina Criminal Gang Suppression Act required a high bar of evidence to prove gang activity leadership or membership, and just put really unrealistic expectations on prosecutors, a really high bar to prove gang crimes and that additional penalties that would come along with those. And so, this bill aims to kind of break a lot of that down.
It also increases punishment for recruiting others into gang activity, especially with stiffer penalties around those who are recruited under the age of 18.
Something that the 2008 Criminal Gang Suppression Act did was put a cap on the age at 15. And, you know, trying to eliminate, you know, how those recruiting of people under the age of 18, you know, lowering that threshold to make those penalties harsher. But what we've seen and we see tragically in this case is people even younger than 15 being recruited to join gang violence and gang crimes. And a lot of that is done through social media and other digital communications. And so this bill actually takes the first stand at trying to deter some of that online gang violence through stricter penalties and through increased sentencing.
And so, you know, a number of things this bill aims to do, but really tries to get to the heart of, you know, why did this situation happen and how do we make it easier going forward to prosecute individuals? in connection with gang crimes. Yeah, Andrew, it's a miserable situation, but unfortunately, many of these organized crime gangs, not only here in North Carolina, but across the nation, they do prey on young individuals in their early teens that are going through the middle or high school system in states like North Carolina, using some of those individuals. Of course, again, at very young ages, maybe not fully able to decipher the true difference between right and wrong and prey on those impressionable minds.
So a kind of a miserable situation there.
However, unlike some of some other legislation that we've been keeping an eye in Raleigh, there is some question and some criticism being drawn by the other side. Looks like Representative Deb Butler, the Democrat out of New Hanover County, thinks maybe that there's some problems here. Yeah, absolutely. And the ACLU also spoke against this piece of legislation. And Representative Butler said, what we don't want is to create a dragnet that is so broad that it targets people who are merely guilty by association, right?
Those who maybe are. Are tied up in this gang life for reasons that are unbecoming of themselves or by association. And she went on to say, to her credit, criminals need to be in jail. But we don't want to give up our civil liberties or our constitutional rights and put people in jail who are not actually guilty of those crimes yet. And that was the similar sentiment expressed by the ACLU is this fear of infringing on individual rights just because of some gang affiliation.
Quite shockingly to myself, ACLU actually said if we're going to increase the punishment for people who are in gangs, we need to be sure wearing a certain color or having a picture online flashing gang signs does not necessarily mean that they are, in fact. A member of a gang. Quite starkly there. And so, to that comment, Representative Stevens said, I believe the intention of this bill is quite clear that we must involve some kind of criminal activity, even if we're. On top of not just guilty by association here.
So interesting debate back and forth, a very emotional committee meeting. But hopefully we will see this legislation, I would assume, move quite quickly through the rules committee and into the House floor next week. Yeah, bizarre comment there from the ACLU. Unfortunately, that's not the first time we've heard something like that out of this organization. If passed, and of course, we'll be keeping an eye on that.
We know Andrew will as well. That would go into effect December the 1st of this year. We'll keep you up to date with the details over on our website, CarolinaJournal.com. We appreciate the update this morning. Andrew Pomerance joins us on the Carolina Journal News Hour.
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Batavia now is more, lots more. You're listening to the Carolina Journal News Hour, Charlotte's FM News Talk, 107.9 FM, WBT. Over the last few months here on the Carolina Journal News Hour and on our website, CarolinaJournal.com, we have been covering a very large amount of state incentive programs, predominantly those coming from the JDIG program that have fallen through. It seems like almost on a bi-weekly basis now, we're hearing about a company that previously announced they were going to be bringing a bunch of jobs, a bunch of economic investment to the state of North Carolina, only to turn around months or years later and say, actually, it's not going to be as great as we originally proposed it to be. That is another story that we are tracking this morning to walk us through some of the latest.
Katie Zender, CarolinaJournal.com, joins us on the news hour. Katie, a lot of the JDIG stories that we've covered recently deal with incentive deals that were announced three, four, five years ago in some cases. The one that you're tracking this morning as it relates to Jet Zero, that's relatively new. That announcement was only last year, right? That's exactly right, Nick.
Yeah, so this announcement was made last year, I believe in June, so not quite a year, and they're already announcing delays in the hiring timeline.
So, yeah, this announcement was made in 2025. Jet Zero is an aerospace manufacturer startup that is based out of California, and they're supposedly supposed to be bringing their first manufacturing plant to Greensboro at the Triad International Airport there. And they have already requested delays that were approved by the Department of Commerce to their hiring timeline. And the big issue with these JDIG programs, as we've continued to cover them, or these JDIG incentives, as I should say, is that these are, in a lot of cases, Katie, very large hiring goals, sometimes thousands, five, six, seven thousand employees, billions of dollars worth of private investment. They're very lofty goals.
And unfortunately, this track record over the last couple of years shows that either, A, the projects don't happen at all, as you're talking about now, the timeline can be delayed pretty significantly, or in some cases, they pare down the hiring so much, sometimes cutting it by 80 or 90 percent, that it's nowhere near the deal that was originally announced. Yeah, that's exactly right, Nick.
So with this project, their overall hiring goal was 14,000 jobs by 2036. That deadline has now been pushed back to 2037. And then they had some smaller hiring goals that have been shifted a little bit.
So their original hiring goal for 2027, which is next year, was just over a thousand jobs. They have now changed that timeline to be no hires in 2027, but they're accelerating the hires in 2028 and 2029.
So they're still trying to meet their initial hiring targets for 2029 of 3,020 jobs. They just won't be making any hires in 2027 and then increasing their hires in 2028 and 2029. And then they're pushing back their entire timeline one year from the end of 2036 to the end of 2037. Katie, we're talking about a lot of jobs here. We're talking about a lot of investment.
This was a major announcement over at the Triad airport when this was originally announced back in 2025. And obviously, it'd be great to have 14,000 new jobs here in North Carolina, billions of dollars worth of additional private investment. But I would imagine a lot of folks hearing this original announcement: oh, yeah, we're only pushing it back a year. We're going to continue with our goals as they're stated out right now. It might be a little bit of PTSD because we've seen this similar story with a lot of these other J Dig companies as well.
That's exactly right, Nick. In fact, we just saw it here recently in the last month with VinFast. And Teresa Opega, you know, has covered that, been covering that story for the last couple of years. And so, Brian Balfour, he's the VP of research here at the John Locke Foundation. He said, This is already beginning to resemble the VINFAST debacle.
This project's failure began with requested delays, and it seems like barely a day goes by without another announced delay or failure of a JDIG project. In fact, he also posted on Twitter this morning: he said, Will this become the VinFast of the sky? Yeah, again, we hope that's not the case because, again, we're talking about a lot of really great paying jobs, a lot of folks in and around the Piedmont area of North Carolina having the ability to work for this employer. A lot of economic impact from this. But even outside of this, Katie, I was reading another story this week about a window and door manufacturer that was supposed to open a facility in Johnston County.
They've completely scrapped that project. It's unfortunate because when these projects are announced, it is unfortunately so many years down the road that we find out these jobs aren't coming to fruition. And a lot of people don't even remember exactly what the original deal was, what the original announcement was.
So you take this kind of victory lap before anything has even begun, only to find out two, three, four years down the road that the project is completely scrapped or it's pared back so much, it doesn't even resemble what it was originally intended to be. That's exactly right, Nick. And so the reasoning with Jet Zero for this delays is they are blaming the tie-up with the state budget and the delays in the state budget for the needed delayed timeline. And so both the deputy chief of staff on both the House and Senate side have commented on this. Demi Dowdy, who's Speaker Hall's Deputy Chief of Staff of Communications and External Affairs, she said, we have fully funded year one of the project and have passed necessary technical corrections to facilitate Jet Zero's construction process and are committed to funding year two of the project by the start of the fiscal year.
And then Lauren Horsch, who's the deputy chief of staff for Senator Berger, Senate Leader Phil Berger, she said the Senate remains committed to fully funding the project and securing the $133.9 million necessary for this upcoming fiscal year in the state budget.
So according to both Lauren and Demi, this project is fully funded for the first two years. CGA is fully committed to funding this project. Patr Patrice. Geist Bethia also commented on this. She is the Deputy Communications Director for the North Carolina Department of Commerce.
And she also said that these kind of modification requests are not uncommon. And the state often grants these modifications, as they did in this case. This was approved by the Economic Investment Committee of the Department of Commerce on Tuesday. She said they usually grant these if it's believed that the company is acting in good faith. Yeah, and of course, that question over good faith does remain relatively unknown as of right now, as we're still in the very early phases of this project.
But Katie, it is interesting to see Jet Zero say, hey, this fact that the state and the North Carolina General Assembly didn't pass a budget when the new fiscal year started July the 1st of 2025, that's the reason we're pulling this back. And then to hear from both corner offices and the North Carolina General Assembly saying, hey, we've passed your technical bills. We've already set the money aside. Kind of an interesting rift seemingly already beginning between the state and this company. Right, right.
So yeah, we'll definitely be keeping an eye on this, Nick, and just keeping everyone up to date with this story as it progresses. And yeah, hopefully we don't see another VinFast debacle here. Yeah, no question about it. The VinFast story has been an unmitigated disaster. We encourage our audience to go read more about JetZero.
Katie's got the story on that over on our website, CarolinaJournal.com. And of course, we've got continuing coverage of VinFast and other J-Dig announcements that have not come to fruition here over the last couple of months and years. All those details, CarolinaJournal.com. We appreciate the information this morning. Katie Zender joins us on the Carolina Journal News Hour.
Welcome back to the Carolina Journal News Hour, Charlotte's FM News Talk 107.9 FM. WBT, I'm Nick Craig. Good morning to you. We continue our coverage this morning of what we are expecting to be a very busy month of June in the North Carolina General Assembly. If you'll remember back just a couple of weeks ago, we got an announcement from both the North Carolina House and Senate that lawmakers were, in fact, moving forward on a budget framework.
That was the middle of May. And as we turn the calendar into June and watch what happens in the General Assembly over the next couple of weeks, we are patiently awaiting a budget deal from state lawmakers to walk us through some of the main priorities that Republicans should be focusing on. It's my pleasure to welcome the Senior Vice President of Research over at the John Locke Foundation, Brian Balfour, back to the Carolina Journal News Hour this morning. Brian, fingers crossed, waiting a year plus for a state budget at this point. You've got a great article over at the John Locke Foundation about some of these priorities.
Walk us through some of them if you would. Yeah, yeah, great. Thanks for having me on today. Appreciate it. Yeah, so we're looking forward over the next month to see what sort of a budget deal gets worked out.
And so I figured I'd put down on paper kind of a 20,000-foot view of a handful of priorities that we at the Locke Foundation are hoping these legislators keep in mind as they work on this budget process. And kind of starting obviously with. Let's try to keep spending in check. Governor Stein put out his budget proposal a little while ago, and that. showed an eleven percent increase year over year in spending.
Double digit percentage increase is just completely uncalled for and unsustainable. It would mark a twenty seven percent increase in spending over just the last four years.
So let's kind of dial that back, have some more realistic total spending goals. A couple other things that I'd like to look at is This whole shell game that they started a few years ago of putting money into special reserve funds. And then they withdraw the money out of that reserve into the spend into the general fund, but it's not counted under the general fund spending because it's considered, they classify it as a receipt-supported expenditure because it's supported by a receipt from that reserve fund that they just dumped the money into. And we looked back at the last actual full budget bill they passed in 2023. They did this to the tune of $7 billion, moving these monies into these various reserve funds.
And there was 30, a total of 30 of these reserve funds. That they had to choose from, basically, 20 of which had been created just since the year 2020.
So, this was kind of a new, really emerging trend that really obscures any sort of budget transparency and kind of hides the The true nature of the full spending of the general fund.
Well, let me ask you about that.
So, let's say that the final budget is $30 billion. Let's just use that as a benchmark number. They transfer $7 billion from these rainy days, the technology fund, all these other reserve funds. The final spending is $37. But as you're saying, what the people are seeing and what the final announcement is, is only a $30 billion budget, which I guess is, in this case, with $7 billion worth of additional funding, Brian, is nowhere near the final total.
Yeah. Yeah, exactly right. And and kind of budget uh nerds like myself, insiders, uh they call that above above the line, uh, that money that they move into reserves like that. Um and and so it's Considered not available for spending, but then it's withdrawn from the reserve fund immediately, and it's counted, as I said, as receipt supported, which then does not count against the general fund total. And that was a recent phenomenon, like I mentioned.
And I look back even just a handful of years ago, even monies that they would put into the Rainy Day Fund, the Savings Reserve Fund, that would count. Against the general fund total.
So they were counting all those monies being put into reserve funds, and that shifted just in the last handful of years, really.
So I, you know, I. I just think that's a really bad budgetary practice, especially to what it does to transparency. It just does not fully express the amount of funds that are being appropriated by the state budget. Yeah, I mean, it's a large sum. We're not just talking about a couple hundred thousand dollars squeaking out here or there, Brian.
We're literally talking about, in some cases, could be 15, 20% of the budget, depending on what some of those final numbers look like.
So, some big time dollars there. Before you get into a couple more of your bullet points, I want to go back to the first thing you mentioned. You know, the state of North Carolina, no question about it, over the last 15 years, has really been exploding in terms of growth. A lot of folks moving here, a lot of businesses being here. Brian, we're seeing something different than in other states.
Florida, for example, has seen similar amounts of population growth. Their state budget has actually gone down year over year with the leadership of Governor DeSantis and their Republican-led legislature. We have not seen that here in North Carolina. The budget continues to creep up each and every year. Or is it maybe a fairy tale or a fantasyland dream here to believe that we can get to a period of time in which we continue to see that growth, but spending actually goes down here in the state of North Carolina?
I think that's going to be real difficult. And one of the biggest challenges is the recent expansion of Medicaid. We've seen Medicaid expenditures explode in the last few years since we expanded. I think there's. 700 creeping up on 800,000 people now that have signed up on the expansion part of Medicaid.
And that just becomes really unsustainable. And so. Just that and all the other pressures, the majority, when you stop and think about it, the majority of the money that the general fund, that the state budget spends, is paid. Paying employees, right? Salaries.
Benefits and retirees, their pension benefits and health care benefits. That's the overwhelming majority.
So, until we take a closer look at that, there's no way we can really kind of rein in spending.
So, what we mean by that is agencies looking at how can they become more efficient, how can they do more with less and still provide the services that they're duty-bound to provide to the North Carolinians, and also look for ways maybe that they could. outsource the labor, contracting with third parties where they just pay a flat fee and therefore the state's not on the hook for these benefits and retiree benefits and pensions for decades to come. Yeah, I mean, you can pay somebody $50,000 or $100,000 a year. You, of course, incur all of those extra fees associated with that versus going to an outside party who, by the way, also could be located here in the state of North Carolina, Brian, pay them $100,000 and not have to deal with any of the retirement, the health care, all of the other things associated with having an employee on the payroll.
Some interesting work that could be done there by some of these agencies. All right, back to your list over at the John Locke Foundation. A couple of other major priorities. You do highlight the importance of setting aside dollars, dealing with the Rainy Day Fund, of course, coming off, almost hitting the two-year anniversary, the devastation of Hurricane Helene in western North Carolina. That's something that the state did not have 15 years ago after 100-plus years of Democratic control.
The state was, for all intents and purposes, practically broke. Yeah, yeah, exactly right. And even going back to 2008 when the economic recession hit. The Democrats had control. They were not setting aside money into the Rainy Day Fund, even though revenues were growing pretty dramatically year over year.
They just They just spent it as soon as they got it in. It was very short-sighted. And so North Carolina was caught really flat-footed when that recession hit and revenues dipped. They didn't have any savings to dip into.
So right now we're up at $3.6 billion in the Rainy Day Fund. There's another $800 million in a stabilization and inflation reserve fund.
So almost $4.5 billion right there. But I'd like to see them continue to try to aggressively put some money aside, maybe get up more closer to like $6.50 to $7 billion in reserves. As I mentioned in the article, I'm in good economic times. They don't last forever.
So, I think legislators would be far more responsible to continue to prepare for that rainy day that's going to come so that. When it does hit They don't have to get take desperate measures like quote unquote temporary taxes or anything like that, then they have a nice, healthy cushion to buy them some time and absorb the drop in revenues when a recession hits. And so I think they would be well served to continue to stock that rainy day fund. Yeah, great points there. And you mentioned some of these temporary taxes that we have seen in the past during some of these economic issues or natural disasters, whatever the issue might be that has the state on the hook for potentially billions of dollars.
You do, however, highlight that lawmakers do need to continue their process over the last 15 years of reducing the tax burden on not only individuals, but corporations across the state of North Carolina. Brian, this has been all the rage in North Carolina politics over the last couple of weeks, a real ideological battle between the political left and right. Why do you think lawmakers should continue down the path they have been walking the last couple of 15 years or so? Sure, yeah, absolutely. I mean, a few important reasons.
Number one, just look at the economic success that is brought to North Carolina. Economic growth, income growth, job growth have been really bolstered by these tax cuts, making North Carolina a far more attractive place for investors and job creators. Secondly, other states are being more aggressive. Neighboring states like South Carolina, Georgia, other states like Louisiana are getting more and more aggressive about cutting their taxes.
Some even having discussions about eliminating their state income taxes altogether.
So, if North Carolina stands still, we have you know we risk getting passed over by other regional states like that. And thirdly, all the warnings-we've been hearing the warnings for nearly 15 years now about how tax cuts are just going to starve the state budget. We're going to be facing constant shortages, but the opposite has actually been true. We've enjoyed massive surpluses basically year in, year out, for the last dozen years, significant surpluses, revenues come. Coming in far ahead of what expectations and projections are because those projections always overstate the decrease in revenues from tax rate decreases.
But that doesn't happen. The additional economic activity that the tax rate reductions encourages creates more revenue than they anticipate.
So we want to continue to do that. And then, lastly, again, when and if we do hit a recession, we'd be far better poised to absorb that if. Our tax burden is lighter on workers and businesses. It has very much become a boy who's cried wolf situation as it relates to the impending fiscal cliff, Brian, that we have been apparently looking over over the last 15 years here as Republicans have consistently, and in some cases, more than cut the tax rate in half as it relates to the personal income tax that everybody and most small businesses, I'll note, pay here across the state of North Carolina. Your final out of your five priorities for state lawmakers is something that we've been keeping a very close eye on over at CarolinaJournal.com and at the John Locke Foundation, a group that I don't think a lot of people actually know the name of, NC Innovation.
We're not talking about a couple dollars here, Brian, as well. Half a billion dollars worth of state funding just a couple of years ago. Yeah, if you had half a billion dollars to NC Innovation, and for those who are unfamiliar, this was a new group that was formed basically to try to fund research ideas taking place in universities across North Carolina and try to take those ideas and new innovations and bring them to the market, commercialize them to a commercial product. But that's. Taking taxpayer dollars.
and putting it into basically a venture capital fund. And that's not the role of state government. Taxpayers shouldn't be on the hook for these kinds of often risky investments. Of course, the taxpayers aren't themselves going to get any sort of return on that investment. It's going to be the private companies, if they are successful, that get that return on any sort of investment.
So it's just outside of the realm of what state government should be doing with our taxpayer dollars. And somewhat surprisingly, Governor Stein has even recognized this. And in his budget proposal, he proposed to claw back that half a billion dollars from NC Innovation and put it towards other uses.
So in this, this could be a very unique opportunity for the state legislature and Governor Stein to be in lockstep on a policy proposal, and the Locke Foundation would certainly support it as well. Yeah, we don't often see a lot of bipartisanship as it relates here in the state of North Carolina between some members of the executive branch, including Governor Josh Stein and the Republican-led legislature. An interesting marriage on this issue of NC innovation. As I mentioned at the top, we are expecting a lot of movement on many of these priorities and more from Republican lawmakers in Raleigh over the next couple of weeks. You can read more on Brian's story by visiting our website this morning at johnlocke.org.
We appreciate the information. Brian Balfour, the senior vice president of research at the John Locke Foundation, joins us on the Carolina Journal News Hour. Out here, if you're doing nothing, you're doing everything right. Though on a cruise with Norwegian, even if you're doing nothing, you're still basking in the warm sun, enjoying the peaceful ocean waves. You're breathing.
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See store for details. Delivery available on qualifying orders. I'm not sure if I can do it. Good morning again and welcome back to the Carolina Journal News Hour, Charlotte's FM News Talk, 107.9 FM, WBT. Following up on some details out of our most recent Carolina Journal poll, as we just chatted with David Larson about that, the North Carolina Senate Health Care Committee has advanced legislation that would roll back parts, not all, but parts of the state's certificate of need law, CON, continuing a years-long push by Republican lawmakers and free market health care advocates to loosen the state's restrictions on medical facilities and services.
The Senate Health Care Committee favorably reported and gave a favorable report to Senate Bill 1040, which is called the Repeal Con for ASC, an Inpatient Rehab Act that happened on Wednesday with the bill sponsored by state representatives Michael Lee, the Republican from New Hanover, Benton Saury, the Republican from Johnson, and Jim Bergen. The Republican from Harnett. It was re-referred to the Senate Appropriations/slash Base Budget Committee, where it sits right now. Certificate of need laws do require health care providers to obtain state approval before developing or expanding certain medical services, adding facilities, beds, or equipment. With critics arguing that the process raises costs, restricts supply, and allows competitors to block new entrants into the market.
And while Senate Bill 1040 would not repeal the entirety of North Carolina's Certificate of Need Law, instead, it targets two areas: specifically looking at inpatient rehabilitation services, facilities, and beds, and also dealing with ambulatory surgical facilities. The bill also requires the Department of Health and Human Services to develop a plan to phase out the state's remaining certificate of need laws, making the proposal both a targeted repeal bill and a potential roadmap for broader reform across state government. Donald Bryson, the president and CEO of the John Locke Foundation, said that this bill signals that lawmakers are treating targeted reform as a step towards a full repeal. With him saying in part, by repealing North Carolina's certificate of need requirement for those inpatient rehabilitation facilities and other surgical centers, lawmakers are directly attacking the regulatory barriers that inflate health care costs and restrict patient access. The bill's inclusion of dedicated funding for a comprehensive plan to phase out the state's remaining con laws signals that this targeted reform is not an endpoint, but a deliberate first step towards full repeal.
The North Carolina General Assembly is clearly building momentum for this kind of pro-competition, pro-patient overhaul that North Carolina desperately needs. During the committee meetings, State Senator Michael Lee said that Senate Bill 1040 fits into a broader debate on health care affordability, saying in part, We need to find a way to move forward in the area of health care. There's a lot of other affordability efforts going on, site-neutral fees, and all the other stuff that's been worked on with this. This is just one piece of the puzzle that we've got to move forward to help patients, consumers, and constituents on the health care front with access and affordability. Senator Brenton Sawyer added that repealing certificate of need requirements for some surgical centers would have a direct impact on health care costs, saying in part, as we continue to talk about billion-dollar rebates and the largest line items, one of the top two or three increases in rebates is hospital procedures.
This is real dollars to the state, and this is something meaningful that we can do to save taxpayer dollars and drive down health insurance premiums. State Senator Ralph Heist, the Republican from Mitchell County, framed the issue around whether providers should be allowed to take their own financial risks when expanding care, as he said that North Carolina should welcome providers that are. Willing to build new facilities, particularly in areas of the state where access does remain a main concern. Telling his fellow lawmakers if facilities want to build in western North Carolina, the answer should be yes. Thanks for coming in.
If you think you have a capacity to build a 150-bed facility and you're taking that risk, have at it. Certificate of need remains a top of discussion and conversation here in North Carolina. We're keeping an eye on the progress right here on the Carolina Journal News Hour. And that's going to do it for another edition of the Carolina Journal News Hour. WBT News is next, followed by Good Morning BT.
We're back with you tomorrow morning, 5 to 6, right here on Charlotte's FM News Talk, 107.9, WBT.