by Ran Coble, Executive Director, N.C. Center for Public Policy Research, January 19, 2011 for the N.C. Center for Nonprofits’ Public Policy Forum
I. THE NEW POLITICAL LANDSCAPE IN NORTH CAROLINA: The New Republican Leaders and New Demographics of the Legislature
Let’s look at the new political landscape. On November 1, the day before the elections, Democrats in the state Senate held a 30-20 majority. The next day, voters gave Republicans a 31-19 majority. That is more than 3/5 of the Senate – enough to override a Governor’s veto. Republican Phil Berger, an attorney from Eden, will become Senate President Pro Tem and the leader of the state Senate. As the new leader, Berger will appoint all Senate committee chairs and make all committee assignments. He already has announced many of his committee chairs, and I’ve listed those in a handout for you.
Again the day before election day, the Democrats held a 68-52 majority in the state House. The next day, voters gave Republicans 67 seats. One unaffiliated candidate was also elected, and he has said he will join the Republican caucus, so Republicans will end up with a 68-52 majority in the House – an exact reversal. But Republicans in the House are short of the 72 votes needed to overturn a Governor’s veto.
The House Republicans elected Thom Tillis to become the new Speaker of the House. Tillis is a former IBM management consultant from Charlotte who quit his job to mastermind the Republicans’ takeover of the House. With Tillis, there’ll be an emphasis on jobs and the state budget. Tillis wears a red-and-black wristband that says, “Think jobs.” He handed them out to GOP candidates during the campaign, telling them to snap themselves if they were tempted to talk about anything other than the economy.
Interestingly, there’s a statement on Tillis’ Website about nonprofits that says, “We should have a tax code that helps families own a home and that fosters broader support for charity in North Carolina.”
Another thing that should be of interest to nonprofits, is that there are 13 legislators who work in nonprofits or have nonprofit connections, and that can be a new line of communication for you. I’ve listed those in a 2nd handout for you.Overall, the new 170-member legislature will have:• about 48 people with business backgrounds,• 38 lawyers,• about 29 retirees,• 38 female legislators,• 25 African Americans,• 2 Hispanics – one each in the House and Senate, and• 44 new legislators who weren’t there last session. That’s one-fourth of the legislature.
II. THE REPUBLICANS’ AGENDAA. The First 100 Days AgendaNow I want to sketch out some of what Republicans have said they want to do in the 2011 legislature.I’m going to start with the 8 things that Republicans promised to do in their first 100 days.(1) First, exempting North Carolina from the President’s national health care reform act.(2) Second, keeping our Right-To-Work or anti-union laws;(3) Third, reducing regulations on small businesses;(4) Fourth, funding education in the classroom, not administration;(5) Fifth, eliminating the cap on the number of charter schools allowed (100) in North Carolina;(6) Sixth, requiring a valid photo ID in order to vote;(7) Seventh, passing a constitutional amendment to prevent government from using eminent domain powers for economic development purposes; and(8) Eighth, ending pay-to-play politics and restoring honesty and integrity to state government.So that’s what Republicans have said they want to do in their first 100 days.
B. A Constitutional Amendment To Ban Gay MarriageThough it’s not in their First 100 Days agenda, I think the new Republican majorities also are likely to pass a proposed Constitutional amendment to ban gay marriage and put it on the statewide ballot in 2012.
C. Three Big Areas of Focus for Republican LegislatorsI think there’ll be 3 big areas of focus for Republicans in the 2011 legislature.The first area they’ll focus on is redistricting of all legislative districts and all Congressional districts. The maps they draw will be the ones used for the next 10 years. Any party’s ability to carry out its agenda for 10 years begins with redistricting. The U.S. Census Bureau will send the census data to the state in February or early March, and that’s when the process will start. Remember that North Carolina’s Governor cannot veto a redistricting bill.
The second area of focus will be the economy and increasing in the number of jobs. That’s what got them elected and if they don’t produce on that, they’ll be thrown out themselves in 2 years. As David Gergen, an advisor to 4 Presidents, put it, “Both parties are now on probation.”
The third area of focus for the new Republican majorities will be putting together a balanced budget that the Governor won’t veto.
III. THE BUDGET REALITIES FOR THIS LEGISLATIVE SESSIONA. The State Budget SituationRight now, here’s what we know about next year’s budget. About $1.6 billion in federal stimulus money that came to the state each of the last 2 years will end in July. And I can’t imagine any scenario where Congress would renew that aid to the states, so that already puts us $1.6 billion in the hole.
Then, two years ago, when the Great Recession began, the General Assembly enacted about $1.3 billion in temporary tax increases that also are scheduled to expire in July. And, about $300 million in recurring expenses were paid for with non-recurring money last year. All this adds up to a total deficit of at least $3.2 billion next year, and probably more like $3.7 billion. That’s close to a fifth (19.6%) of our total ($18.9 billion) state budget.
As bad as this is, it’s not like California, whose deficit ($18 billion) is almost as big as our budget, or Illinois, Nevada, New Jersey, Arizona, and Maine, whose deficits are more than a third of their state budgets.
Will the Republicans here extend the temporary tax increases? I doubt it. Or, will they make up all that shortfall in cuts? I think so. Will they pass tax cuts, making the shortfall even bigger? I don’t know.But, $3.7 billion is a lot of money. Let me give you an example. Even if the state stopped spending all money on prisons and shut down the whole Medicaid program – which federal law wouldn’t allow – those cuts would barely fill a $3.7 billion hole. Even if the state cut the whole University system and the community college system, that would barely fill the $3.7 billion hole.
High on the Republicans’ list of targets for cuts will probably be the Medicaid dental program for the poor, reading aides in the first 3 grades, the UNC system, and both cuts and a merger of the Smart Start and More at 4 child care initiatives.
Governor Perdue already held back 1% of every state agency’s funds in August. She cut another 2½% in December. She also froze hiring and clamped down on pay raises, purchases, and travel. She’s also asked every agency to prepare plans where they’d cut 5%, 10%, or 15% from their budgets. And, she recently proposed reorganizations and efficiency savings.
Next year’s budget decisions will probably be the biggest area of conflict between the Republican legislature and a Democratic Governor who has veto power.
B. The Budget Environment for NonprofitsThat’s the big picture look at the budget. But what’s the budget picture for nonprofits that receive money from the legislature or contract with state government to provide services?
The last 2 years already have been tough for nonprofits. The N.C. Center for Nonprofits released a study last fall that shows that 70% of nonprofits receiving state grants and contracts in 2009 already saw a decline in support from the state.
And, the N.C. Budget and Tax Center found that nonprofits got cut more than 25% in 2010.These state budget cuts come at a time when many nonprofits are severely stressed. Here, two studies by the Center for Nonprofits found that:• In both 2009 and 2010, about half of the nonprofits surveyed operated at a deficit, and this was especially true at small nonprofits (expenditures of $100-$250K).• In 2010, 62% of nonprofits froze or reduced salaries, 46% cut staff, and 32% cut health insurance, retirement, or other benefits.• And, for those nonprofits that contracted with government in 2010, more than three-fifths said government agencies changed the terms in the middle of the contract. Another 60% said the state was late in paying for services, and that’s up from 41% in 2009.
So, this is a challenge for all the nonprofits in North Carolina that contract with government or receive grants from state government to deliver services – perhaps a third year of budget cuts, at a time when many nonprofits are already under severe stress.
But there’s also some good news about relationships between nonprofits and the executive branch. The Center for Nonprofits has been asking the Governor to ask agency heads to meet with nonprofits and work together. I want to tell you about one recent development I’m really impressed with.
Recently, Lanier Cansler, the Secretary of the N.C. Department of Health and Human Services, met with nonprofits that contract or work with that department on a regular basis to allow them to have input on policy decisions. He told them, “Help me make the best decisions on the budget and save money where I can. Help me improve services, and let me know where we’re not providing good services and can improve.” At his request, the Center for Nonprofits set up a task force of nonprofits and his policy staff to do this. Putting that process in an Executive Order covering all state agencies could be a huge opportunity for everyone in this room.
IV. TIPS ON MESSAGING THAT NONPROFITS CAN USE IN BEING EFFECTIVEADVOCATES IN THE 2011 LEGISLATURE
The best argument for any advocate in this legislative session is that your proposal will create jobs.On the budget, another good argument this year is that your proposal will save money now. To legislators this year, it means “What can I cut?” Remember that they’ve got to cut about a fifth of the budget this year, so a lot of people in this room are likely to be targets of budget cuts.
If you find yourself in that situation , the best advice I can give you is to focus on the impact of a budget cut on your clients, on the people you serve, in their district. Take your clients to the legislature so that the impact of a budget cut has a face on it. And, when the legislators are home – usually on Mondays, Fridays, and weekend – take them to see what you’re doing and whom a budget cut would affect. Visiting a foster home or talking to foster children or foster parents will stick in their minds a lot longer than a piece of paper.
One of the things I’m most proud of in my career is helping get legislation passed that gave children with disabilities a right to an education in North Carolina – 2 years before the federal law passed. I think it passed because we took legislators to visit programs serving children with different kinds of disabilities and to see that those children were capable of learning and being productive citizens.
If you can’t get legislators to go see a program, use the power of stories. Public policy issues have faces. I’ve seen people afflicted with spina bifida visit the General Assembly to talk to lawmakers. People in wheelchairs made the problem more real. And nonprofits have good stories to tell.
V. 13 WAYS TO CREATE GOOD LUCK IN THE LEGISLATURENow I’m going to share what I call 13 Ways To Create Good Luck in the Legislature. These are tips for how to be effective in any legislative session.
1. First, be specific on what you want from a legislator, county commissioner, or an official in the executive branch. This is a better session to be asking for changes in law rather than asking for more money. If it is money – even if it’s the same amount you got last year – say exactly how much and what it’s for. If it’s a law or regulation you want, try to say or write in plain English how you think the law should read.
When I worked as a legislative staffer in the Fiscal Research Division, I had a legislator come to me with a letter from a constituent because he couldn’t figure out what bill the constituent was talking about, or who the sponsor was, or even what the problem was. The legislator wanted to help, but the constituent hadn’t been specific in what she wanted.
2. Second, work at the committee level, and always talk to the committee chair and the committee staff. If you wait until a decision is made on the floor by the full House or Senate or by the head of a department, you’ve waited too long, you have less chance of affecting policy, and you’ve narrowed your options.The staff in a part-time citizen legislature are key. And they’re among the most talented people in state government.
And, the power of committee chairs is a very important lesson. I worked on a health care bill one time and worked hard to get a good sponsor. The day the bill was introduced, it was not referred to the Health Committee but to the Banking Committee. I immediately ran to the sponsor and asked him what the problem was. He said, “There’s no problem at all. I’m the Chairman of the Banking Committee, and we’re assured of getting a favorable report there and getting it to the floor.” He was right; the bill passed in 5 minutes.
3. Third, put your position and what you want in writing. The process of writing it down will actually refine your own thinking and help the policymaker. But don’t use jargon or acronyms from your own field – this is most nonprofits’ biggest weakness. And, keep what you write for the policymaker brief – to one page if you can.
4. Fourth, do your homework on your facts and your opponent’s facts, and find out more about the people in the legislature. What’s their background? What does their spouse do? Check out their Website. Produce a fact sheet that supports your position and check behind yourself.
Never lie, and do not try to hide facts that cut against your position; you’ll lose the trust of the public official. Your credibility is your most effective asset in advocacy or lobbying.
5. Fifth, use your numbers of people – your clients, your members, and your volunteers. Nothing impresses a policymaker like large numbers, and numbers are most nonprofits’ main strength. There are 4 main resources in policy and politics – money, talent, credibility, and people. Nonprofits don’t usually have money and can’t legally contribute to campaigns, but they do have talent and credibility, and they often have large numbers of people –your clients, your volunteers, your peers in other communities.The most effective groups have as many of their members, board members, clients, or volunteers call as many legislators in as many districts as possible.
Also, don’t concentrate all your calls on one person because then you’ll get one vote. Call as many members of the committee or policymaking group as possible. Call the opponents on the committee last, but do call them; this may make them more willing to compromise or at least keep them from being so vocal.
6. Sixth, form an alliance or coalition with other groups with the same concerns. There is strength in numbers, but greater strength in greater numbers.
7. Seventh, don’t ever threaten elected officials – saying, for example, that you’ll see that they won’t get re-elected! It makes them do the opposite of what you want. Some people have unrealistic expectations about how fast change happens in the legislature.
8. Eighth, go visit the decisionmakers in person. The “system” in North Carolina is still remarkably open. Ask the legislators or policymakers point-blank – but diplomatically – if they support your position. It is much harder for a policymaker to say “no” to a person than to a sheet of paper. Don’t be intimidated; they are people just like you.
The lobbyists that I think are really effective will usually keep a tally sheet after visiting with legislators, and it’ll have 5 possibilities to record: For your positionLeaning forUndecidedLeaning against, orAgainst.Then, once the vote occurs, they’ll check how the legislator actually voted so they can learn from their mistakes. Being a good vote counter is the highest level of skill in lobbying.
9. Ninth, meet with your opposition and see if you can reach a compromise. Having both sides present a compromise or consensus position is a very powerful tool for getting something passed. In effect, it solves legislators’ problems of not wanting to make somebody unhappy. Even if you can’t reach a compromise, talking to the other side will at least prepare you for what their arguments will be.
10. Tenth, look out for the words, “We need to study this a little more.” You’re about to get sent to the graveyard of a subcommittee that will never meet or to a study commission that may never get appointed.
11. Eleventh, take advantage of pivotal events that happen and that present an opportunity to put your issue on the public agenda. For example:• A tragic shooting with an unregistered gun might be an opportunity for a gun control group;• A scandal in government might present an opportunity for a reform group advocating for campaign finance or ethics reform;• A manufacturing plant that got state tax incentives to locate in North Carolina and then closed up gave Bob Orr and the Institute for Constitutional Law a chance to highlight his arguments against this practice.• A hurricane, an ice storm, a flood, or some other natural disaster might present an opportunity for relief groups or for advocates for new floodplain maps;• A fire at a poultry plant in Hamlet or an explosion at a storage facility for hazardous chemicals in Cary can lead to reforms in workplace safety or stricter rules on storing of hazardous waste;
12. Twelfth, be prepared for the 4 questions public officials ask most frequently:(1) What will it cost?(2) Has it been tried in other states?(3) How do you know it will work?(4) Who else is for it and who is against it?If you think the answer to the cost question is $0, you probably need a self-administered dose of truth serum. It’s rare that somebody’s money, resources, or time isn’t involved.
On the question about where else this has been tried, legislators are especially interested about what’s happened in other Southern states. That’s why in the debates about whether the state should start a lottery in 2005, one of the arguments used by proponents was that N.C. was surrounded by states with lotteries, and one of the arguments used by opponents was that studies in other states (like Florida) showed that lotteries often didn’t really end up increasing the total amount of money going to education.
13. And the 13th way to create good luck in the legislature is that when you get help or get what you want, thank the official. Praise them in a letter to the editor (but not as a campaign endorsement). Give them an award. Let your members know who helped them, and ask them to thank the official also. Public officials usually only hear from people who are dissatisfied or unhappy. And, to keep them on your side, you have to let them know that their action is helping someone. Tell them what happened as a result of that bill being passed. Thanking someone is often the best form of advocacy.
Thank you for letting me be with you today.