Government Reform

Once a popular off-Hollywood venue for filmmakers before state film tax incentives, North Carolina is now one of the leaders in a race to the bottom among other states and nations in giveaways to movie production companies. The incentives show that state leaders know that lower taxes and regulations attract industry. So why play favorites with industries? Why not just lower taxes and regulations altogether?

North Carolina’s Unemployment Insurance (UI) administrators have vastly outspent revenues and generated a debt of $2.6 billion with the federal government—the third-highest in the nation, on a per-capita basis. This report proposes five ways for legislators to address this rapidly growing problem.

North Carolina forcibly sterilized approximately 7,600 individuals in the 20th Century as part of its eugenics program. Many eugenics victims are still alive in North Carolina. This report offers five ways that North Carolina should compensate the victims before it is too late.

County governments all over North Carolina are saving money by privatizing services. In an effort to assist in the exchange of information about these activities, the John Locke Foundation conducted a survey of all 100 counties asking county managers to tell us about governmental activities that they currently supply privately. We also asked them if they had problems in the past with a privatized activity that had caused them to return the activity to government provision.

State agencies should not be allowed to issue regulations that exceed federal requirements, and cost-benefit analysis should be required for all agencies. These two regulatory reforms should have a positive impact on the economy, but they are first and foremost about promoting good government.

North Carolina’s auto insurance system is unfair to low-risk drivers because it overcharges them in order to subsidize some of the state’s more risky and dangerous drivers. Every insured driver pays a hidden tax, and private insurance companies are guaranteed a profit. This report recommends reforms to improve the system.

North Carolina has one of the most expensive Medicaid programs in the Southeast, and Obamacare will expand enrollment from 1.3 million people to potentially over 2 million people in 2014. Without Medicaid reform or tighter eligibility, North Carolina will need to cut some services and payments to doctors. Both options will mean worse care for every person on Medicaid. Gov. Bev Perdue and the General Assembly need to push Washington for exemptions from Medicaid restrictions and greater ability to innovate with premium support and encourage patient control of their own care.

This budget proposal would spend $18.4 billion and return spending to the same levels, adjusted for population and inflation, as in the mid-1990s. In addition to ending the temporary sales tax and income tax surcharges, this budget would reduce the tax rates on personal and corporate income, setting the stage for future tax reform.

The North Carolina Education Lottery was sold as a way to boost education spending, but N.C. boasts the same problem found in other lottery states: a declining rate of spending for education, especially in comparison with the rest of the state budget. Furthermore, poverty, unemployment, and property tax rates remain the best predictors of lottery sales.

There is optimism that an eminent domain amendment will pass this upcoming legislative session. This Spotlight explains how to craft the amendment carefully to best protect property owners.