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Months after approval, new tax law mired in questions

The sweeping tax overhaul approved in July is leading to mounting questions months later.

A N.C. Department of Revenue official told a legislative oversight committee Tuesday that it is still trying to determine how to interpret a variety of provisions in the tax bill Gov. Pat McCrory signed into law in July.

Morning Memo: Democrats hit GOP on education in new ad campaign

SEE IT HERE FIRST: N.C. Democrats launch ad campaign hitting GOP on education: The headline "Republican leadership has failed teachers in North Carolina" is hitting newspapers across the state this week in full-page advertisements paid for by the N.C. Democratic Party. The ads target 17 legislative districts (eight Senate, nine House) and criticize Republicans for not increasing teacher pay, forcing class size increases, eliminating some teacher assistants, ending the back-to-school tax holiday, cutting money for textbooks and supplies, taking away the graduate school bonus for (future) teachers and allowing private school vouchers.

"We’re putting Gov. McCrory and Republican legislators on notice that their assault on public education is not going unnoticed," said Robert Dempsey, the party's executive director.

***See the ad and get a list of the targeted lawmakers below in today's Dome Morning Memo.***

Document(s):
AD.pdf

Morning Memo: Another DHHS hire raises questions; FEC chides Tillis camp

ANOTHER HIRE RAISES QUESTIONS AT DHHS -- Unadvertised job goes to former tea party member: The state Department of Health and Human Services has filled a newly created $95,000 senior planner position with a Greenville woman who was a medical school lecturer for three years but who has been absent from the health care labor force since 2002.

Margaret "Mardy" Peal, 42, has been hired as part of the "Partnership for a Healthy North Carolina," Gov. Pat McCrory’s initiative to allow private insurance companies to run the government’s health care program for the poor in North Carolina.

Peal gave $1,250 to the McCrory campaign in 2012. She helped organize the Eastern North Carolina Tea Party in 2010. The job was not posted, which prevented others from applying. Department officials declined to provide a job description or list Peal’s duties. Read more here.

***More on Peal and news from the U.S. Senate race below in the Dome Morning Memo.***

Morning Memo: The recasting of Gov. McCrory? Unraveling his shifts

PAT McCRORY LINKS MEDICAID REFORMS TO TEACHER PAY HIKES -- Governor pledges big announcement in coming months: Speaking at the Cary Chamber of Commerce's annual banquet Wednesday evening, Gov. Pat McCrory promised "controversial" proposals to change the state's Medicaid system. Overruns in Medicaid costs are a huge burden on the state and have drained funding for education, he said.

Citing issues with federal regulations, "a lack of waivers from the feds, and frankly, some of the politics within Raleigh here," McCrory said he wanted to change the state's implementation of the federal health program for people with low income.

"I'm going to have to bring up some fairly controversial proposals to change Medicaid, or we're going to continue to have some very, very serious issues here in North Carolina," McCrory told the crowd. "That's coming in the next three, four months. I'll probably introduce them while the legislature's out of town, between now and May," he said, drawing laughs. Changes to Medicaid, he said are " the way we're going to get raises to the teachers."

***McCrory appears to be charting a new course, but the administration is backtracking on a different education announcement. Read it all below in today's Dome Morning Memo***

Morning Memo: NCGA studies Colo. school choice; DHHS execs see pay bump

NCGA STAFF EXAMINES COLORADO SCHOOL CHOICE: Three employees of the General Assembly went to Douglas County, Colo., for nearly a week in June to examine that county’s school funding model and determine the feasibility of trying something similar in North Carolina.

The Douglas County school district, the third largest in Colorado, is known for its emphasis on school choice and has pursued major – and often controversial – education reforms in recent years. Read more here.

***Get a full wrap on North Carolina political headlines below in the Dome Morning Memo. Send news and tips to dome@newsobserver.com.***

Morning Memo: Arizona Gov. Jan Brewer to attend Wake fundraiser

JAN BREWER TO ATTEND WAKE GOP FUNDRAISER: The Wake County Republican Party announced Arizona Gov. Jan Brewer will attend a Sept. 14 fundraiser in Raleigh for the local party's fall candidates. The announcement email includes the now infamous photo of Brewer, a Republican, wagging her finger upon meeting President Barack Obama at an airport tarmac. The top ticket for the fundraiser is a $5,000 VIP package and a single ticket is $75. The party expects the event to sell out.

THE MUMMIES RETURN: From columnist Rob Christensen-- "We have seen this before in North Carolina – the reign of the green-eyeshaded men who thought low taxes trumped all, and if there were any coins left in the till at the end of the day they would throw it into the education pot.

"It was called the 1800s. And Walter Hines Page had a name for them. He called North Carolina’s leaders “the mummies” as in very old, well-wrapped, very dead Egyptians because of their complacent conservatism." Read his full column here.

***Get more North Carolina political news below in the Dome Morning Memo.***

Morning Memo: Tillis dodges shutdown questions; McHenry pressed on Obamacare

TILLIS DODGES GOVERNMENT SHUTDOWN QUESTION: Republican Thom Tillis is emphasizing his opposition to the federal health care law in his campaign for the U.S. Senate but at the same time he's avoiding answering some questions on the issue. A Democratic Party operative recently asked the Republican House speaker about whether he agrees with Texas Sen. Ted Cruz and others who suggested shutting down government to defund the federal health care law.

While walking to a recent D.C. fundraiser, Tillis didn't offer a direct answer -- even though if elected he may face similar circumstance. "It's not my decision to make but anything we could do to slow down or eliminate Obamacare would be good for the nation," he said in a video posted online. (Watch above.)

Does Tillis agree with North Carolina Sen. Richard Burr that a shutdown is the "dumbest idea" ever? Again no answer. "I'm going to leave that to the duly elected senators but i think we can do to stop Sen. Hagan and President Obama from creating all the uncertainty and cost that comes with Obamacare it would be a good thing," he said. Expect both questions to return soon.

***See the Tillis video below in the Dome Morning Memo, along with another video from Republicans punking people at the "Moral Monday" rally.

Morning Memo: GOP not united on budget; Tillis explains abortion vote

REPUBLICANS SCRAMBLE TO PASS THEIR OWN BUDGET: Ten House Republicans voted against their party's $20.6 billion spending plan, including one of the chief budget writers. GOP leaders held an extra lengthy caucus meeting Tuesday to whip members to vote for the bill but hours before hand lobbyists reported that it looked like it could fail.

The House passed the budget on a 66-52 preliminary vote. … It’s somewhat unusual for the majority party to lose more than a handful of its members’ on a budget vote. It’s even rarer for a budget committee leader to vote against the budget as did Rep. Linda Johnson, a Kannapolis Republican.“I was not pleased with the education budget,” Johnson said. (More below.)

THOM TILLIS SETS HIS ABORTION VOTE STRAIGHT: Every move House Speaker Thom Tillis makes is viewed through the prism of his U.S. Senate campaign in 2014. And for weeks the Republican's rationale for supporting the House's much-debated abortion measure remained quiet. Asked about it Tuesday, Tillis said "it happens to be something that I support and I thought if I didn't, they'd say, 'Why didn't you?' so I thought would solve the question by making it very clear where I stood on the bill." It puts Tillis, who is considered a moderate Republican, in the same position as Rick Santorum. (Read why below.)

***Keep reading for more North Carolina political intelligence in today's Dome Morning Memo. Send news and tips to dome@newsobserver.com.***

Gov. Pat McCrory signs tax bill into law

Gov. Pat McCrory signed a major tax cut bill into law Tuesday, saying it will help ease the state's economic pain.

The measure cuts personal and corporate income taxes to the lowest levels of neighboring states and limits future states spending. McCrory and Republican leaders say it will give a break to every taxpayer but legislative analysis suggest some families, retirees and small business owners may see a tax hike.

$100 penalty for filing taxes late approved in committee

People who file taxes late could owe a flat $100 fee under a bill the House Finance Committee approved Tuesday.

Rep. Paul Stam, an Apex Republican, amended the bill, aiming to alleviate concerns for low-income taxpayers. The amendment says the new penalty applies to individuals’ income taxes if the net amount of tax due is greater than zero. The “net amount of tax” included is only what is imposed after credits and tax payments. So, if there is a refund due, the penalty would not be imposed.

For personal income taxes, the late filing penalty would be $100. For all other taxes, including sales tax, the penalty would amount to 5 percent of the tax amount.

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