- [Kelly] The move to end DEI programs from state agencies and government now turns to public schools.

The House moves to close loopholes so sheriffs must call ICE, and the bill to allow state investments in Bitcoin funds moves along.

This is "State Lines".

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[dramatic music] ♪ - Welcome to "State Lines", I'm Kelly McCullen.

Thank you for joining us.

Joining me today WUNC Radio's Capital Bureau Chief Colin Campbell.

To his right, representative Erin Pare of Wake County.

Representative Zack Hawkins of Durham County joins us for the show.

And debuting, the Chair of the North Carolina Forward party, Patrick Newton.

Patrick, welcome to the show.

- Thanks so much for having me.

- You asked for it, you got it.

[Patrick laughing] So you have a good panel here.

So a lot of power players.

You got experienced journalists, so good luck to you sir.

- I'm looking forward to it.

- Lot's of pressure.

- Pleasure to have you.

State Senate republicans are pushing to guarantee the end of DEI in North Carolina Public Schools.

It's Senate Bill 227.

It would require school administrators to certify that their districts have no DEI departments or specialized employees.

They would also vouch for their schools as not engaging in, quote, discriminatory type tactics or teaching divisive ideas.

Legislation for now appears to have no punishment mechanism for schools that do not comply.

Representative Hawkins, here we go with state agency.

Well, university started, the UNC system.

- That's right.

- And now we're adding laws and laws and laws.

Your take.

- I can't keep up with the alphabet, the buzz letter politic today.

I really can't.

And I have this conversation all the time and someone said to me, the 1960s are calling.

They want their divisive politics back.

And it's really one of those things that at the end of the day, we have to trust educators.

Educators are closest to our students.

They are not trying to indoctrinate students.

They wanna make sure that every student has the ability to live out their God-given potential in the state.

They wanna make sure that they're learning math and science.

They wanna make sure that they learn how to read and write.

They're not trying to do the things that this bill is purporting.

And in so many ways, I would love to ask parents.

Parents, what are the types of activities that are happening that would warrant a statewide ban?

- Representative Pare, there are several, it's been piecemeal legislation when it comes to DEI programs and trying to either roll those back or eliminate them.

Why not one big comprehensive bill to cover every possible contingency instead of just a bill here, a bill there?

- Right.

Well, when I think of DEI, I'm thinking of the implementation of what we're calling DEI.

And I think when I describe some of those concepts, I'm thinking of two words that are in opposition to one another.

So I'm thinking of impartiality and division.

And I think the good part about what we call a DEI implementation would be the impartiality and equality of freedom of thought, freedom of asking questions in the classroom.

Instead of division, which I think this bill is addressing where it comes into compelling someone to conform to a certain ideological concept.

So when you actually read the bill, the bill does say explicitly that it is the intent of the general assembly to make sure that equality is in the classroom, that students are able to ask questions freely, share their opinions, discuss things in an equal environment.

And I think we can all get behind that.

- Colin, the poll suggests DEI, the rollback has been popular with voters at least as of November '24.

But if you also ask those same people and oftentimes you ask them the same question in a different way, do you want equality in classroom, do you do support inclusion, they're gonna say yes as well.

So what gives with the political aspect of DEI and whether it lives or dies in North Carolina?

- I mean, I think it's been successfully branded among Republicans as a negative, and that has sort of resulted in some of the policies we're seeing.

What I struggle with in covering these things is just trying to figure out what are the concrete examples where banning what's happening in schools or state agencies now that needs to be done away with specific to an actual program, not just sort of just sort of a general concept of what's right and what's wrong.

Because I think sometimes these bills are written broadly enough.

I mean, you'll hear people say, "Well, does this mean we can't teach Black History Month?"

And I think most people would agree, you probably should be able to teach Black History Month.

So there's a lot of sort of fear about what's not allowed, what's allowed in these bills.

And not a lot of specific examples of what we're actually tackling that's happening right now in our schools or our state agencies.

- This Forward Party, Patrick, you're the chair of it.

It's not Republican, not Democrat.

And your party, to me, positions itself as being able to split hairs politically, split this hair of DEI.

- I'll do my best.

So one of the things we talk about is the distinction between values and policy.

So diversity, equity, inclusion, I mean, I think those are things we can all agree make our communities richer and stronger, both in the private sector and in the public sector.

But when you get into policy, that's where things can come a little unglued.

So there's certain programs, and I think language is so important, but those words, on their surface, again, something we could all hopefully support.

But it's become such a lightning rod at this point.

I think of woke, for example.

I mean, honestly, the first time I heard it, I aspired to be woke.

I thought it sounded great, right?

It's an awakening.

I'm gonna be more engaged, more aware.

Like hey, I hope people call me woke.

And now you fast forward today, somebody walks in the room and calls you woke, it's, hey, watch yourself.

So it's really about the language and what it represents.

I love what everybody said too, like give us some specific examples.

What is it in these programs that are upsetting people?

And as you point out with the parents, right?

I mean, these are their children in these schools, so let's get some feedback from them and let's try to find some common ground.

- Yes, well I think when you look at the bill and you go through what the bill actually lays out about the principles that we're trying to express in what DEI should not be, we're trying to keep the train on the rails.

We don't want to get off track here and start getting into compelling people to conform to certain concepts.

I mean, I think that's where you get into the problem area.

When you're talking about equality of discussion and questioning and thoughts in the classroom, I have a little anecdote.

When I was in high school, one of the most vivid memories I have as a teacher that gave us a question that the class could discuss, and it was actually after the Oklahoma City bombing, and he said, "Tell me about whether you believe that it should be legal for there to be books in a public library that tells you exactly how to build a bomb to that level of the destruction that we had just seen a few years before."

And I had no idea if that teacher was a Republican, a Democrat, I didn't know where he stood on the issue, but I learned a lot just from the back and forth of the discussion in the classroom.

And I think that is the right perspective of implementation of the correct version of DEI, and I think that's what this bill is trying to express to the public.

- Yeah, and I have to ask, what part of DEI do you disagree with, the diversity, the equity, or the inclusion?

Because I grew up in a very similar way.

My teachers really valued the individuality that I brought to the table.

They saw me as a whole student.

They wanted to make sure that I could be my best self, but that included ensuring that there were operations and opportunities for me to be who I was and I think that's what's wrong with this bill.

That's what's wrong with this national narrative.

And for those who are in the Republican party here, I want them to be original.

Let's talk about things that are moving students forward, student outcomes.

Let's not get drowned out by this national narrative because North Carolina can chart its own path of education that doesn't include some national narrative.

- The bill's just filed going through the Senate.

It's got a long way to go.

Do you think you'll get those questions?

I would think in public discourse you'd be owed that, right?

- Oh, absolutely.

We definitely will get that question.

And it's a hot topic no matter where we go.

- North Carolina House speaker representative, Destin Hall is pushing to require all sheriffs, all 100 counties to call I.C.E.

if they're releasing an undocumented or illegal immigrant who's being held under a detainer request.

Mecklenburg County Sheriff apparently was holding immigrants under detainer requests, then he would release them if I.C.E.

didn't call his department and that 48 hour detainer timeline expired, other sheriffs in North Carolina are contacting I.C.E.

once they execute a detainer request, representative Paré.

Just loophole closed loophole loophole closed loophole.

What is it about state law that's confusing?

- So I think we passed House Bill 10 last session, which required North Carolina sheriffs to cooperate with I.C.E.

on detainer requests.

And then we saw that implemented differently with some sheriffs across the state.

As you mentioned, the sheriff in Mecklenburg County, instead of alerting I.C.E.

to this individual with a detainer has been in custody for almost 48 hours and he's going to be released, that sheriff just basically released that individual instead of making that additional phone call to I.C.E.. And I think that is the loophole that is getting closed with House Bill 318.

And I think that that's necessary because the message that we're sending here as a body is that if you are here illegally and you are committing crimes, you have to go.

And I think that this is a needed bill in order to achieve that.

I also would say that maybe under reported that there are some additional offenses that are added to this House Bill 10, lesser offenses that would require a sheriff to determine whether an individual in custody for these lesser offenses is their legal status.

So that's like embezzlement and fraud and drunk driving.

So it actually does add additional offenses that would require sheriff to determine that individual's legal status that's part of the bill too.

- Representative Hawkins, when it comes to these bills having to go into policies that are pretty easy to understand, let's be honest, this is common sense, right?

Now you're passing state laws, getting into the nitty gritty.

it doesn't get better from here, if you ever took power, you'd be doing the same thing 'cause you'd have to, I think, these sheriffs and anybody who just didn't wanna follow your rules.

- Again, it really leans into a national narrative that we are anti-immigrant, that we're anti anything that's not what we say as a typical American.

And that's the, really, that's the thing that's not, that doesn't feel good about North Carolina to be completely honest.

And it strikes fear across communities because they think whether they're illegal or not, they potentially may be caught in this ring.

And so the one thing about the bill and the bill previously, anytime that you want sheriffs or anyone to do what you're asking 'em to do, you need to be clear the first time.

And so that's why we're here because the bill was a knee-jerk reaction to what was happening outside of North Carolina and did not give the clarity to those sheriffs.

And so they did follow the law.

And so that's what we have to give them credit for is that we're following the law.

And it also is a bit of a burden on our local sheriffs because no more resources are coming from the federal government.

They are having to use their time and hold these folks in excess of waiting for ICE.

to come which sometimes that's not determined within a 48 or even a week's time period.

- Patrick, something about this whole debate of our great republic is local governance.

The Sheriff in Mecklenberg County interpreted state law and locally governed in such this case.

Now the law can change.

Are we in a bigger philosophical debate than immigration?

- Yeah I think, you know, it's important to think about discretion in law enforcement.

- [Host] Right.

- So someone's going a few miles an hour over the speed limit, I think most people want that police officer to have the discretion to say, "Hey, they're a threat and then need to receive a ticket."

Or you know, a warning, slow down, you know, "Improve your behavior."

And you know again, I think most people want that discretion, but in this case, I mean, the General Assembly's been very clear.

And with our sheriffs being elected officials, you know, they're up for office.

They can make it clear what their policy recommendations are, where they stand on the issue, what they think should be enforced.

But to go against the, you know, what is clear law at this point, that again many people seem to support, that's when it seems like maybe they've gone too far.

- Colin, Sheriff will say, "I'm doing what my voters elected me to do."

These legislators are saying they're doing what their voters told them to do.

What to do?

- Yeah I mean, that's what happens when you have sheriffs like at the county level, and the counties are often very blue counties, and a legislator that leans very much Republican at the statewide level.

Sheriffs are sort of the power unto themselves in a lot of these counties.

They don't necessarily answer the County Commission.

So they don't tend to take kindly at being told what to do, so they're gonna look for kind of the legal loophole and see if they can get around that, and then you're gonna have another round of legislation.

So none of this is terribly surprising how this is played out.

- So this is...

Legislating is sometimes a multi-step process.

So you can pass a bill that you think is perfect, and it's gonna work out exactly the way you think it's gonna work.

But sometimes it doesn't, and you have to come back and close those loopholes, or fix the law.

So that's what we're seeing here.

About a narrative, though...

The narrative, the correct narrative here is to, is about the rule of law.

And upholding the rule of law.

And I think that's what we're trying to do in North Carolina to make sure that laws are followed, and people who are not supposed to be here are not here.

- And good point, Colin.

I never met a sheriff that did not like being... [all chuckling] To stay with you, Mr. Campbell, State House is moving legislation that would give future State Treasuries and even the current one, Brad Briner, the option to partially invest in cryptocurrency investment funds.

The bill stalled Tuesday over the house Commerce Committee in Raleigh before House Speaker Dustin Hall stepped in, lobbied in support of it, and somehow, Colin, it just seemed to pass on Wednesday.

[panel chuckling] The plan wouldn't allow the Treasurer at his discretion to invest up to, I think 10% last I checked, into a state's investment portfolio into a Bitcoin investment fund not directly buying Bitcoin.

The Treasurer is not required by law to invest in any crypto.

And Brad Briner says, "You know what?

"This technology, I'll take it, and I'll support the bill."

I've gotten emails from folks that are worried about that state putting money into Bitcoin, and I wanna be very clear with the words I choose.

It's partial investment in investment funds- - Yeah, I think mutual funds, I guess, for cryptocurrency is how I've been describing it.

- And I've seen on the partisan basis, some of the tweets and social media, people are, I think, actively misleading on what this bill actually is.

If I had to interpret this as a reporter.

- Yeah and I think one of the thing is, I think made the difference on this bill between the first hearing where it kind of stalled out, and the second hearing where it passed the Committee was, that this totally on the discretion of the State Treasurer, who is now Brad Briner.

Who, Republican, worked for Michael Bloomberg at managing his investment portfolios.

So there's a lot of trust that Briner is going to, if he even uses this tool, do it in a way that's fairly cautious and conservative and doesn't put the state's pension plan on the line.

What's interesting is we see the State Employee's Association coming out very strongly against this.

Saying, "This is, you know, too risky an investment "for something as crucial as people's pensions."

So I think that seems to be the big tension here.

Obviously for House Speaker Dustin Hall, it's the first bill he's sponsored as Speaker.

He's putting his political capital behind it.

We haven't heard from the Senate side, I think we've asked Senate Leader Phil Berger about it, but he seems a little bit more lukewarm on the idea.

There may be some generational splits here, a lot of different opinions about cryptocurrency and, y'know, where it's headed and, y'know, whether people are really gonna understand what it is and what you're investing in.

- Patrick, under previous treasurers, the investment strategy was very conservative, almost only in treasury bills, and, as a result, the current treasurer says the pension plan is underfunded, the health plan is way into a deficit, headed towards a billion dollar deficit, based on, quote, "not so risky investing."

So what gives here with cryptocurrency and its future as a possible state asset?

- Well, and I think not just so much crypto as just some creativity, right?

I think, y'know, being open-minded and looking at different investments that can enhance the portfolios of the State.

The alternative is to increase taxes, right?

I mean, we have to raise money one way or another.

So what I like about this bill though is that there are limits on it, right, with the 10% cap and that it's at the discretion of what Briner thinks is an appropriate investment.

So, y'know, crypto seems to be here to stay and if we're gonna put our toe in the water and see where it takes us as a state, I think most people are supportive of that.

- Representative Hawk, is there any ban against investing in crypto if you're the Treasurer?

As it is, I never heard of a law banning him from doing anything.

- No, - We won't force land all sorts of investments as part of the treasury.

- Y'know, and diversifying portfolio is always important, right, making sure that the state, as he mentioned, has every possible option.

The thing that I like about it is it gives them the discretion to follow the market.

If it looks like it's tanking, then we pull out, right, we don't invest as heavily, but if it looks like it's promising it can have great yield, then we have the opportunity to continue to lean in.

And so that's the part that I appreciate and that's why I'm sort of, y'know, continuing to wait to see how it develops.

But right now, on its surface, I like the discretion that he's given.

- Right, I would just add that, y'know, this is giving the option.

It's not requiring anything.

And I think in Treasurer Briner, he has a great background for this.

He's actually a brilliant person.

But I think that you're also seeing in Treasurer Briner somebody who wants to set up more of a board sort of environment to make decisions like this too.

So he's kind of one that's stepping away from the "I make every decision".

But I think the process here, where it didn't go so well the first time, and then the committee the second time, you're just seeing people kind of hit the brakes and go, "I don't fully understand this, but I have to vote on it, I have to cast a vote on record for it, so let me just take another round so I can try to understand a little bit better from the Speaker."

- Can you blame any legislator for if they don't fully understand...

I mean, I can understand you want to support the Speaker of the House, but you don't understand the bill.

Which is more risky, bucking Destin Hall or voting for something you don't understand?

And that's a fair question.

- Well, no, it is a very fair question.

I think you can do both and, right?

Because at the end of the day, both of us have to go back to our voters and we have to be in the grocery store, we have to have town halls, and people are gonna ask us those questions.

And so by better understanding the bill, we can better support the Speaker, if that makes sense.

And I do also, one thing about this bill too is, as Representative Pare mentioned, is the community of the board.

It's very in line with what endowments do in systems across the country, and so having the ability to have more smart people who understand that landscape and investing is super smart.

- But Colin, if the legislators approve this for Brad Briner and then we put 10% in and it tanks, who owns that, Brad Briner or legislators?

- Probably a mix of both, I would think, if it comes to that.

But ultimately this does differ...

Some other states have tried mandating their state Treasurer make these investments and that's where the bills have gotten a little bit more tricky.

But this is, again, part of a national movement.

Cryptocurrency advocates would like to see state and federal government investing in crypto, 'cause that's good for the cryptocurrency market, so that's sort of the push and pull here.

- Yeah, the Treasurer's Office is usually fairly sleepy, Patrick, but this show, we're gonna get our year's quotient out of the way.

A lot has happened.

Let's talk about this state health plan, Patrick.

Covers nearly 700,000 state employees and their families.

It's facing a $500 million deficit, so state employees, including myself, Colin, facing a near doubling of our monthly insurance premiums.

State health plan premiums have been steady for nearly a decade.

The fact is they were not increased during the inflationary years earlier this decade.

A Treasury report says consolidation of healthcare providers, Patrick, sparked cost increases that legislative funding can't seem to keep up.

Backdoor into that certificate of need were the closed market and consolidation is rising prices causing the Treasurer to say state employees, pony up.

- Yep, so this got me thinking about just the budget as a whole.

I mean, it's in excess of 30 billion at this point, right?

So I did some math and certainly would love to have people double check it 'cause I did it about 10 times, 30 billion divided by 365's over $80 million a day that we're asking you as part-time employees to manage for us, right?

So that's just some mind-boggling numbers, but specifically to this topic, it's a challenge and we really need to find a way to address it.

One of the questions I would have is why there haven't been increases along the way, and I've spoken to some experts in this field, rates have been going up steadily, 5% to 6% for the last few years, and again, the people I've spoken with say there's really no realistic expectation that that's gonna slow down or come to an end.

So I think it might've been some good intentions by the general assembly to not pass on those increases, and I think it's always been kind of a perceived value to state employees, maybe not having the strongest salaries as they would have in a private sector, but, quote unquote, "Good affordable benefits."

But the reality is it's time to pay the piper, so I'm hoping we can find some creative ways.

We spoke in the green room about efficiencies, right?

We've all unfortunately seen examples of bureaucracy in the state level and the federal level, and again, with a scalpel, maybe not a chainsaw as we've seen in some cases, but can we find some efficiencies and some savings so that we can invest in the people that are in this program?

- Representative Hawke, as Brad Reiner says that he's not gonna ask or recommend the legislature do anything in its budget to boost the state health plan.

That a good call?

- It's he's playing the cards that he's dealt, and I think there should have been decisions all along.

We should not have waited until we got into this situation that he's having to inherit.

- Voters elected that, so we can start from there.

They've elected a new Treasurer and a new path forward.

- Correct.

- So at the end of the day, voters selected these policies.

- Correct.

- That resulted in the investment strategy, so Brian reviewed how, by the Democratic caucus in general?

What kind of dude is he?

- I mean, he's treasurer, which for most parts, I mean, I know it's a partisan, race, but really no different than the way that Janet Kyle was seen, is she wasn't necessarily a partisan when she was in that seat, and we don't see him the same way.

We just want him to do what's best for the state health plan and the investments for North Carolina.

- Representative Pare, a lot of people in Wade County will be affected by premium increases, but they also like insurance and everyone understands inflation, So I'm not sure how this falls out politically 'cause it seems understandable if a bit more expensive on people who work for the universities and schools and such.

- Right, yeah, I would just say that I don't think anybody wants to do this.

I mean, nobody wants to be raising people's rates at this time when medical costs are going way up though, and so you just have to understand that that's maybe just a natural order of things, especially since there hasn't been any perpetual increases in so long, so I think that that's probably just going to have to be a necessary move at this time, unfortunately.

- Yeah, sorry, but it can't happen all at once.

- Are you being lobbied by the State employees Association?

Usually they're really loud about such things.

I have not seen much.

Now, they're loud about crypto, but have they said much about this insurance deal?

- Not yet.

Not yet.

But to be sure, we're early in the session - And 'cause I know you guys listen if they call, they do.

[group chattering] - Well, and maybe if there's having been increases for so long, I mean, I think doubling anybody's premiums is difficult to swallow.

Maybe we come up with a creative solution where we can stagger that over a period of time so people can adjust and the state can help subsidize that, at least to get us where we need to be.

'Cause it's been ignored frankly, for such a long period of time, to address it overnight could be a lot.

- Colin, when we say doubling, it could be 25 to 40 or 50 bucks, not 300 to 600 bucks.

So let's keep the facts where they are here-- - Yeah, and that's the thing I'm really watching and selfishly I'm watching it for myself as someone who's on the state employees health plan.

It's a great deal for the employees themselves.

It's not so great a deal once you start covering your spouse or your kids.

So I'll be interested in what the increase is for those covering multiple family members 'cause that's where you could really see a financial hit.

If you go from 25 to 40 bucks a month for yourself, I mean it's not great, but it's not terrible.

- I wanna ask the other leaders this question with our last two minutes.

Brinders said, "A restriction in market."

So that means the market is getting smaller, therefore prices get higher.

It's an economic play, but yet this state fights and will not allow new hospitals to come in as the market would demand you go through a mechanism that is lobbied and politicized.

Does this open the door to certificate of need debate?

Because in theory, if it restricts and prices go up, if you expand, wouldn't prices go down for competition?

I know I'm setting you up for that, but I hear, we talk about certificate of need on this show.

Most folks don't follow it.

But yeah, I mean, do we need a bigger market for healthcare?

- We have-- - No one's even answering.

[group laughing] - No, we have a decent market for healthcare.

I don't know if it will open the door for a certificate of need.

I'm very doubtful.

- And what about the pension plan?

Which ones politically you think is gonna be harder to fix, Colin?

Get the premiums right, close the deficit for the health plan or moving towards the retirement pension for state employees.

There needs some investment.

- Retirement may be easier just because it's been so conservatively invested for years that I think Brinder can make some strides in that direction.

Health care is just so complicated.

I mean, we rank really highly among the states in this country for the cost of healthcare.

And there's a lot of different ways that are percolating around the legislature to get that cost down.

But they're all opposed by one healthcare lobbying group or the other, which is why a lot of these things have stalled the past few years because the healthcare lobbyists are some of those powerful people in that building.

- Certainly.

Well, that concludes the show.

Thank you so much for being on.

Thank you for coming back.

Good to see Representative Poirier.

Patrick, nice debut sir-- - I survived.

[group laughing] - It's always good to see you.

First of all, thank mostly to you folks.

Email us your thoughts and opinions on "State Lines" at pbsnc.org.

I'm Kelly McCullen.

See you next time.

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