- [Kelly] State leaders must review the future impact of the One Big, Beautiful Bill on state spending, Senator Tillis discusses why he's leaving the Senate, and former Governor Cooper receives a Senate endorsement, and he's not running yet, this is "State Lines."

- [Announcer] Quality public television is made possible through the financial contributions of viewers like you who invite you to join them in supporting PBS NC.

[triumphant music] - Hey, welcome back to "State Lines" everyone.

I'm Kelly McCullen.

Joining me today is Michael McElroy of Cardinal & Pine.

Good to see you, Mike.

A debuting Theresa Kostrzewa of Capitol Advantage.

Welcome to "State Lines."

- Good to be here.

- Well, a lot of good topics there.

To your right, Pat Ryan, good friend of the show, PR executive.

- Thanks for having me on.

- World Traveler Mary Wills Bode, former State Senator with us, and always good to have you Mary Wills.

Hope everyone's summer's going.

I don't think I've seen any of you since the spring, at the very least, but it's been a busy spring.

It's a sleepy summer, but a lot's going on.

I mean, we are in America.

We're moving beyond this national debate over President Trump's One Big, Beautiful Bill.

It's now one big law.

North Carolina budget writers, if you're one of the few of those right now, you may be, you know, facing a problem with dealing with Congress's passage of it.

North Carolina's Medicaid Expansion program could roll back by state law as it's currently written after the '26 midterm elections.

That's when the federal government could begin paying less than 90% of the Medicaid expansion costs.

So our state law would end Medicaid expansion should the Feds cut reimbursement below that 90% threshold.

Governor Josh Stein is calling for a very conservative budget now.

I think the quote was "exceptionally conservative budget."

Pat, are we worried about things three years from now today?

- Well, let's just go back to the summer that you're talking about, Kelly.

I am sick of winning.

We have been winning so much under the Donald Trump presidency, that I'm tired of winning.

I hope all of you are too.

I'm just joking, so this.

[Michael and Kelly laughing] Mr. President, please, so much winning.

Now this Medicaid issue is a real issue.

It's gonna be a math problem, right?

There is no denying that.

To put it as simply as possible, so to pay for Medicaid expansion, providers, particularly hospitals, pay a tax, right?

And that's what funds the expansion population in North Carolina.

The One, Big, Beautiful Bill, it always puts a smile on my face to say that, caps that tax below what is necessary to fund Medicaid expansion moving forward, and it starts in 2028.

So lawmakers are going to have a hole in the budget in a couple of years that will get bigger over time, and they can either find a new revenue source to fill that hole or curtail Medicaid expansion.

Neither is, of course, a great option, right?

But all this is very fresh, maybe a week old.

The good news is they have a couple of years to sort it all out, and just speaking generally, Medicaid keeps on taking up a bigger and bigger portion of the federal budget.

I think it's doubled in the past 10 years alone.

Sooner or later, something had to be done about that.

So better now than later perhaps.

- Mary Wills, if you're a current senator now, what are you saying about this?

So there is no state budget, so we can just tack on this Medicaid budget potential challenge up with Helene, with Chantal, with any other storm that might come.

What else are we missing that's gonna blow a hole in the state budget?

- Sure, so when I was a senator, passing Medicaid expansion was certainly a highlight of my tenure.

It was a bipartisan victory for North Carolina.

After many years, we had a Democratic governor, Governor Roy Cooper, working with our Republican leadership in the House and Senate to finally get Medicaid Expansion passed in North Carolina.

With this bill that was passed, that takes a lot of that progress that almost 700,000 North Carolinians becoming eligible for health insurance.

And the stabilization of our rural hospital system wipes a lot of that progress away.

And I think it's important to note what Pat mentioned is that we were able to broker a deal with our healthcare institutions that make a lot of money off of healthcare in North Carolina.

We tax them at 6.5%.

And this national bill curtails, our ability to tax them.

And that Delta is gonna go to the taxpayers of North Carolina.

And that's a really big issue to push that money onto the taxpayers of North Carolina.

Not to mention the fact that this bill takes away food from 600,000 hungry children in our state.

And it also implements a very onerous workplace or work requirement system that only one state in the country has done.

And it cost about $13,000 a person to administer in the state of Georgia.

And that's money that's not going necessarily to healthcare or to helping these people get off, of Medicaid and become self-insured or insured through their employer, but rather just administrative cost for overseeing the program.

And so, you know, I really wish we could have seen something, $13,000 a person going to, giving them resources to go to community college or additional support so they can be productive.

- Theresa, you can hear both sides of this.

And both, one tugs at your wallet, and one tugs at your heartstrings.

A lot of expensive items out there that we demand as taxpayers.

If you're a voter right now, are you, have you figured out yet, some of the congressional decisions will fall towards the state budget?

- Well, so it was not an accident that these folks, these 670,000 will come off the rolls after the midterm elections, right?

So if you're a Republican budget writer, you're not really concerned about the next election.

I think, and you brought this up, Mary Wills, what's more significant and what's gonna be more of a problem for the state is what's gonna happen to all those rural hospitals that have relied on that HASP money to stay afloat.

There's no doubt there will be closures.

The other thing is the legislature loves to tell UNC Health what they have to do and who they have to cover.

So I'm sure UNC Health is sitting there thinking like, okay, which hospitals in three years are they gonna make us take over?

Because they're gonna go outta business.

And to your point about the SNAP funding, that's food program for low income folks.

The cost to the state will be $420 million a year just to pay our percentage.

And if we can't come up with $420 million a year, then all of those people go off the roll.

So it's not just the 670,000, which is five and a half billion a year.

It's the money for SNAP, it's the money for the rural, sorry, the rural healthcare systems.

- Right?

- So there's just a lot of problems.

- Mike, a huge difference in state budgeting and federal budgeting.

Our state lawmakers, they can't roll out the printing press and deficit spend.

I mean, is government reached the point at which it can help all it can help?

- Well.

[Mike groaning] - Yeah, right.

Easy question for you.

- I mean the thing that jumps out at me is that what is the money doing, right?

So we say that something is expensive.

Well, what else is expensive?

Is medical care for our people, right?

So, and there's so many tangents of how this is going to affect the hospitals, the expansion, but there are Medicaid waiver programs in this state that spend a lot of money to help severely disabled children, get the care they need, the lifesaving care they need in the homes instead of facilities.

I'm writing about that now.

We've got two amazing kids, Kinsley and Emma from totally different families who have had their entire lives conditions that they need feeding tubes, they need constant care, nurses care, 24-hour care, this is not covered by health insurance.

Okay.

So even though this is a two-year timeline on some of this, you've got families that don't know, is this money gonna go away, am I gonna have to quit my job in order to stay home with my kid because there's not gonna be a home at healthcare?

Am I gonna have to send them to facilities?

So that care is super expensive.

And so when we talk about these things just as a dollar amount, which is a high amount, holy, how can any state do that, this is what that money is paying for.

It's keeping children with their families in their homes, giving them a life.

And so these are the things that are at risk.

So, yeah, can a government pay for these things?

Well, my question is, what happens if that Medicaid goes away, and the safety net goes away, and these kids fall through it into the event?

- They say the children in need, people that can't work, or sick, they are going to be fine, is what the politicians tell me.

If you're able-bodied, working, and you're single, and you're choosing not to work, we're being told they need to do something to get coverage.

And I hear that.

- No, but that might be true, but it also might not be true because again, the Medicaid waiver program, this is an optional thing so far under Federal Law.

So what's the first thing that's gonna cut?

This optional stuff.

So who knows what's going to be cut, but I'll tell you this, if they have to cut instead of finding the money, then a lot of things are gonna be cut, including potentially these children.

- Can this state even find that much money?

- Look- - They can't find billions of dollars, can't they?

- In every major policy fight, there's all this dooms-dang, there's this sort of catastrophizing that children are going to be out in the street or not be able to afford their food, or what have you.

I don't think that's going to come to pass, number one.

And number two, it's a policy issue that lawmakers have two to three years to sort out right now.

There may be changes at the federal level as well.

The world is not going to end because there has been some changes to an increasingly expensive and unaffordable Medicaid program.

- Yeah.

Okay.

Well let's go to the next topic, which is tied to this.

This US senator, Thom Tillis, has sat down with the CNN's Jake Tapper for an interview this week.

Very interesting interview.

He discussed his reasons for not seeking reelection, but he's also asked about the potential 26th Republican primary candidates field.

And for like the second week in a row, Mark Robinson's name came up.

- I'm committed to helping the President get that candidate elected.

If it's not, well, let's say a handful of people that will never make it in a general election.

And before the revelations of many Soldier and everything came out, Mark Robinson was not on the stage any longer.

There's no way if he became the nominee in North Carolina, I could possibly support him.

Of course, I wouldn't support the Democrat nominee, I would just have to take a pass.

- All right, Pat, is the media or is it Thom Tillis tying to conjure the resurgence of Mark Robinson in 2026, and he's out there tweeting as well, and you know, he has millions of people, couple million people in this state support him.

- Yeah, well, so it's 2025, thankfully, not 2024 anymore.

We can all, I think, hopefully move on from that gubernatorial election.

I did watch the CNN interview.

I can't recall whether Senator Tillis or Jake Tapper introduced the idea of Mark Robinson.

- I think it was Tapper.

- I think it was Tapper.

- It was Tapper.

- And so I think that clip was Tillis responding to that question.

Yeah.

Look, if anybody remembers, some people wanna forget the 2024 election, Senator Tillis was very much opposed to Mark Robinson, I think, even during the primary.

So it's no surprise that he would speak forcefully in that manner, in that interview.

I haven't seen anything to suggest that a Mark Robinson campaign for US Senate is in the cards.

But it's something that, I guess reporters and Jake Tapper like to keep on going.

- Yeah, Mark is fun to talk politics and Tom Tillis will be the popular Republican on what they would call liberal news outlets.

We know how this game is played.

But Thom Tillis is moving on.

Just didn't wnat to deal with it anymore.

He used a very colorful word to describe why he left.

He was not gonna put up with that BS anymore.

Things like that, that's fun to see.

Why don't we have that candor out of these elected officials while they're elected?

- Well, because he was going to run for reelection before and now he's not.

And now he gets to be free, I guess.

- Civilian.

- Yeah, civilian.

But I will say that as soon as Tillis said he wasn't gonna run again, the media again, not me, but a media said that this race was now a tossup.

It was always going to be a tossup, especially if Cooper run.

Cooper versus Tillis would've been an intense, amazing, very close race.

But I don't Mark Robinson.

Mark Robinson is not gonna be the, not gonna be the nominee, but I will say that it does bring up like Mark Robinson and then the adjacent, 'cause the nominee is going to not be a Tillis Republican.

The nominee, almost certainly the Republican nominee almost certainly is going to be a little bit farther on the right in line with the Trump, whether it's Laura Trump or whomever.

And so it becomes what are the, what are the policies that are going to be presented for the North Carolina voters?

And it's gonna be a stark difference and the thing is the more and more we get into this current track of politics, I think the differences between the nominees are going to be more stark.

The idea of an election in which some candidates agree on one thing or maybe not.

Like, I think that might be gone for a while.

And so that is gonna be a really stark idea, I think of ideas.

- True.

- I think, I think it's gonna be so much simpler.

I mean, the nominee will be whoever Donald Trump says the nominee is gonna be.

Laura Trump gets first bid, Michael Watley gets second.

And then if neither of them, then it's up to those other candidates who are interested.

Jim Kane was in the news this week saying he'd been receiving phone calls, all the various congressmen.

So the question is, who does Trump pick?

Once Trump picks that nominee, that person is going to have to be a Trump Republican.

So if I'm Roy Cooper, that Sunday when Tillis said I'm out was my favorite day because I think this all but guarantees Roy Cooper is gonna run in this race 'cause it's much more likely he has a chance of winning against that far right Trump Republican.

- Do Republicans like Roy Cooper, or Democrats like Roy Cooper, I should say.

- Oh, over, over?

- Republicans like Roy Cooper.

I had it right the first time.

- Wait, do Republicans like?

- Is Roy Cooper popular with Republican voters?

A swath of them at least.

I misspoke on all that.

- Oh yeah, no problem.

Well, if you look at his elections and you look at who supported him, why Roy Cooper has won when other Democrats have lost is because enough Republicans would vote for him.

And then he off obviously got the independent vote, of which there are more and more all the time.

It's also, as we all know, the interim, the midterm elections for the party in power and the presidency, it's always a bad year for them.

So it just looks better.

- Yeah, like there's certainly some Trump Cooper voters in the gubernatorial elections in 2016, 2020.

There's no doubt about that.

I think a US Senate race is a bit different.

I mean, remember President Trump won the state by what, four, four and a half points in 2020, three and a half.

It was a, it was a substantial margin compared to, to previous elections right?0 And this, this US senate race will of course be nationalized and federalized.

It's not gonna be an in-state gubernatorial race right?

So I think it's a bit of a different dynamic, but there's no question that, you know, former Governor Cooper remains popular and is of course the top tier candidate for this race for many people.

- Republican voters want a populist Republican.

Mark Robinson represented blue collar people.

That's what he came, then the character attack that came as part of the, of a brutal campaign.

- Yep.

- But Laura Trump is not blue collar.

She, Michael Watley represents the party.

We got Harrigan out there, who was the third one.

I mean, so what do Republican voters want?

Do they want a Republican elitist or they want a populist?

- Certainly the like populist strain of.

of the party, even on, I think both sides of the aisle, is fairly ascendant.

And people respond to people who don't sound like they're robots and polished, buttoned up politicians just saying things to try to get elected.

I think that's the bottom line.

That's why Mark Robinson was such an appealing figure, you know, set aside the controversy.

It's why Donald Trump is such an appealing figure.

And so call it populist or establishment, I think it's really more about that style and how one presents oneself to voters.

- [Mary] Authenticity.

- Yeah.

- Sure.

- Mary Wills, you retired, or took a break from politics, much like I would think Senator Tillis is doing.

What is it like to you as a person to sit back after you've made that decision?

I'm not even going to go through the attacks.

I'm not dealing with this anymore.

What does it do to you as a person?

- [Pat] As a retiree?

- [Kelly] As a retiree.

- [laughs] In my retirement.

In my retirement era.

You know, I really... You know, I know that he has a heart for service.

I know that he has served the state for many years and it's hard to walk away from a position where you know you can serve so many people and make a difference in so many people's lives.

But I'm sure as part of that, he also feels a little bit of a sigh of relief.

It is very difficult to run statewide in North Carolina.

He has done it twice.

It was gonna be, as he mentioned in the interview, the most expensive US Senate race ever.

And his last US Senate race was the most expensive US Senate race ever.

- Yeah.

- So, you know, I know that he will find another way to serve.

There are many ways to serve.

And so, you know, I think he has, you know, certainly done his part as a Republican in elected office and, you know, I wish him well in his retirement.

- Appreciate the segue.

I wanna talk about... Well, Roy Cooper's social media accounts sort of perked up a couple of weeks ago with these benign sort of, you know, high-minded, you know, like representing family and all this on the social media.

Well, Jeff Jackson apparently stepped out this week and endorsed Roy Cooper for the US Senate race.

Of course, Mr. Cooper's not an active candidate yet.

Former US representative Wiley Nickel, he is running for the Democrats if you're a Democratic voter.

Cooper's former campaign strategist, Morgan Jackson, friend of this show says any decision on a Senate run is a personal choice for former Governor Cooper as to how he can best serve the state.

So Mike, I will start with you on this.

It seems like, to Pat's point, whoever Donald Trump picks, everybody else quits the primary and goes away.

And now you get this vibe that if Roy Cooper enters the race, Wiley Nickel's not supposed to try very hard or is supposed to step aside.

Why can't we get a nice bruising primary?

- [stammering] Well, I don't know.

I don't know.

Do we love bruising primaries?

I think they're exhausting.

- Party folks don't.

They've told us that on this show.

- I mean, here's the thing.

I think that Wiley Nickel is a strong candidate.

If there were no go Governor Cooper, it would make a lot of sense for Wiley Nickel to.

I mean, he won in a Republican, or a slightly more conservative district.

People didn't think he would and he says that all the time.

And he won.

He was gerrymandered out.

So he's a strong candidate.

But if Cooper, but I mean, obviously I think he'll probably stay in for a little bit.

They'll talk.

I think they kind of overlap on a lot of ideas too.

So they probably have the same viewpoints on a lot of things.

So at some point they're kind of the same candidate maybe.

But Cooper is going to be the nominee most likely if he runs.

- I mean, it's good for what I do, for a living, for lots of candidates to run and offer competing ideas.

And it turns, it does appear that people are just in a hurry to quit.

I mean, Jeff Jackson takes himself out of the race by endorsing a candidate who doesn't exist yet as a candidate, Theresa.

What do we make of this?

- Well, so first of all, times have changed, right?

So the amount of money, what are they estimating?

Like $800 million or something for that US Senate race, all in, all the private money, all the c4s, et cetera, et cetera.

So it's gonna be a huge monumental undertaking just to run the race itself.

And so if I'm Wiley Nickel, I'm thinking, "Bye-bye."

Cause' I, I think Cooper would trounce him.

- Why not get trounced though, Pat?

Why not at least get a shot?

Republicans are lining up.

Some smaller candidates are already in this race, but as you say, it looks like Donald Trump gets to pick who represents North Carolina.

Why should North Carolina voters be satisfied with that if they're on the GOP side?

- Well, I think North Carolina voters will by and large on the Republican side support whoever President Trump says he wants to be the nominee.

And so I think they'll be satisfied just by the very nature of they support him and they will support whoever he supports.

Both parties have a major interest in winning this race and winning this race is harder if there is a really divided and expensive primary, I think that it's, you know, it's for the greater good for each party that somebody like President Trump can almost coordinate a nominee and they can have a Clyde path to the nomination.

And it's really similar on the Democratic side.

I mean, former Governor Cooper is going to clear the field if and when he announces because he's, he's popular, he's well known, and he's just the biggest candidate that they can possibly find for this race.

- Well, I think there's - a little bit of a difference between us.

You know, I can't, I'm not a Republican voter so I can't speak, but this idea that we're okay with the President of the United States picking our nominee and we don't want the voters to decide, and we kind of just lay that at the altar of President Trump really should concern folks.

People are gonna get behind Governor Cooper because we have voted for him many, many times.

North Carolinians have voted for that candidate.

He's won 13 elections in North Carolina.

He's won statewide six times.

We know what we're gonna get.

He been before voters and made his case many times as opposed to someone flying up to DC or down to Mar-a-Lago and kissing the ring.

And I think that we should, we should demand more out of our election process as voters.

And we should say we get to decide, not somebody else.

- In three years, we'll be able to.

- North Carolina's lottery commission's reporting that North Carolinians, you like the sports bet.

We, the people, if you will, have helped sports betting achieve a three year revenue goal in the first year.

Bettings been legal in this state.

The state earned $116 million, Theresa, off six and a half billion dollars in sports bets.

What's interesting is the bookies or the books, as they call 'em, have paid out 89% of the bets in winnings.

The state betting revenue is distributed across UNC system campuses in part, just not the UNC Chapel Hill or North Carolina state.

But changing that and increasing collegiate funding is part of the now stalled budget bill.

Pat, you're, you have a client that is involved in sports betting.

It's a wide reaching PR and lobbying effort.

And I don't know your, your engagements as well, Theresa, however.

- None - Good.

- Objective.

- Yeah.

- I'm totally objective.

- I sports bet.

I've got the app on-- - Let me get my Draft King app out.

- I've got my app, I have done it.

I've won some, I've lost some.

Amazing.

You legalize it and all these people, I bet a lot of conservatives are betting on the football game.

- Oh, there's no doubt.

So the thing that some, so it has, it has over succeeded right?

- Right, I mean-- - The revenue projections are, - were way wrong.

Many more North Carolinas are betting.

And so, what's also in the budget that has not been resolved is that the Senate put doubling the tax rate from 18% to 36%.

And if you look at statistics in the country and actually throughout the world, when you start increasing that tax rate, you end up setting more, sending more betters off books or offshore, which then cuts into revenue.

- So better odds, right?

- Yep.

- 'Cause they get better odds of winning.

So yeah, so that is going to be one of the interesting fights between the House and the Senate.

And then the other piece you already mentioned was giving money to UNC, Chapel Hill and to NC State.

I think that's inevitable now in the days of NIL, you, it just, yeah.

- And don't, - East Carolina App State and Charlotte do great under this bill if they can ever get a budget bill passed.

Pat, so that's what happens if Republican budget writers double the tax on sports betting, we're gonna get worse odds and betters are gonna lose more often.

Is that right from your perspective representing?

- I think that seems like a reasonable sort of conclusion.

- [Kelly] Okay.

- Right?

If a larger chunk of sports betting revenue is going to the government in the form of taxes, there's of course, less that can be paid out to betters in the form of winnings.

And that impacts the odds, right?

And so if people have worse odds, or if they feel like they have to send too much of their winnings to the government in the form of taxes, they're gonna go back to the black market.

- [Theresa] Yep.

- And there's plenty of overseas websites that, you know, don't really play by the rules, but that can probably offer slightly better odds in an environment of really high taxes.

- [Theresa] Yeah.

- And so I think the story of sports betting in North Carolina is you have American headquartered companies doing things the right way and playing by the rules and paying reasonable taxes in North Carolina, at least they have been so far, which is good.

It's everybody's winning from that, right?

- Mary Wills, you're not lobbying for gaming, are you?

I mean, you're just, you're still retired and everything.

- I'm not, and I actually didn't vote for this legislation, You know?

- Well, it's a source of revenue.

If you double the tax, we need hundreds and billions and billions of dollars coming up.

Why not just tax gamblers?

- Yes, and at what cost?

So once we've gotten folks addicted to mobile sports wagering, we're gonna send them offshore to, as Pat mentioned, places that aren't playing by the rules.

And it's a much more Wild West situation.

And so, you know, I was unconvinced.

I spent a lot of time studying this issue.

I looked at other countries that have mobile sports wagering, and many of those places have since rolled a lot of that back, because, particularly with young men, it has been catastrophic.

And they are spending more and more of their wages on mobile sports wagering.

- Okay.

- And, you know, it just doesn't end well.

- 45 seconds, Matt.

Adults are adulting on this case.

They're putting their discretionary income into the sports and making some money for the state.

Can we fill some real budget holes?

- Well, from my understanding, and please correct me if I'm wrong, the the money, the revenue generated from these taxes is kind of earmarked for the colleges and institutions.

It's not.

- [Theresa] Only up to a certain amount.

- The amount, okay.

- So the rest spread and it can be changed.

- Anywhere.

- Of course, the budgets can change.

- All right.

Well then, I mean, I say, great, we need the money.

So as long as we can continue to keep people from being addicted all the time, then I think that's great.

We need the money.

- We have to hurry to get out of that.

We're out of time and you were worried that you'd be the last person speaking and not get us outta the show on time.

You did a great job, Mike.

Thank you.

Theresa, welcome to the show.

- Thanks.

- Hope you'll come back.

Pat, good to see you.

Mary Wills, as always.

Email me at statelines@pbsnc.org.

We'd love to hear your comments.

I'm Kelly McCullen, thanks for watching.

I'll see you next time.

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