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North Carolina Senate Passes Nation’s Lowest Flat Tax, Blocks Cap-And-Trade

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North Carolina Senate Passes Nation’s Lowest Flat Tax, Blocks Cap-And-Trade


Lawmakers in North Carolina, the state that has been an inspiration and model for tax reform efforts in so many other states, are once again taking action to make their tax code even less burdensome and more conducive to job creation. On May 18, the North Carolina Senate passed a new budget that speeds up already-codified income tax relief and schedules further rate reduction, bringing the state income tax rate down to 2.49% by the end of the decade.

As the latest example of significant tax relief receiving bipartisan support, more than a third of Democratic caucus in the North Carolina Senate voted for this new budget, which would give North Carolina the lowest flat income tax rate in the nation, a title currently held by Arizona’s 2.5% flat tax. North Carolina already has the lowest corporate income tax in the nation and that tax will be phased out entirely by 2030.

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Governor Roy Cooper (D) released an executive budget earlier this year that would halt the phaseout of the North Carolina’s corporate tax. As expected, that proposal was rejected by the General Assembly, where Republicans now hold supermajorities in both the Senate and House thanks to the party switch announced by Representative Trisha Cotham (R) last month.

The North Carolina House passed their version of the budget in April, which speeds up already scheduled income tax rate reduction that was approved as part of the budget signed into law in November 2021. Aside from the income tax relief, there are other parts of the House and Senate-passed versions of the budget that conservatives will like. Both the House and Senate budgets, for example, would protect North Carolinians against efforts to impose a cap-and-trade program for carbon emissions with a provision stipulating that “No state agency, governor, or the Department of Environmental Quality, may require certain public utilities to engage in carbon offset programs.”

Critics of cap-and-trade point out that it has the same effect as a carbon tax, resulting in higher gas prices and utility bills. Cap-and-trade is part of the reason why the price of gasoline in California is typically much higher than the national average. The inflationary effect cap-and-trade has on the price of gas is also a key reason why the Transportation and Climate Initiative (TCI), a proposed regional cap-and-trade program focused on transportation emissions, folded after receiving a cold reception from lawmakers in every blue state where it was pitched save for Massachusetts. That did not deter Governor Cooper’s administration from voicing support for TCI.

The move to block imposition of cap-and-trade without legislative approval in North Carolina follows a series of cap-and-trade-related developments in other parts of the country. Governor Glenn Youngkin (R) is now working to remove Virginia from the Regional Greenhouse Gas Initiative (RGGI), another regional cap-and-trade program, because of the inflationary effect it has on utility bills. Meanwhile in New York, Governor Kathy Hochul (D) recently authorized a new cap-and-trade program as part of the $229 billion budget signed into law in early May.

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Governor Hochul tasked the state Department of Environmental Conservation and the New York State Energy Research and Development Authority with studying the potential effects that cap-and-trade would have on energy prices in New York. They found that cap-and-trade could inflate the price of a gas by 62-cents per gallon and raise the cost of natural gas by 80%, which would adversely affect the 60% of New Yorkers who heat their homes with gas.

“We began running the numbers on that, based on some of the metrics being used by Washington state and some of our own, and revealed some…potentially extraordinary costs affiliated with the program,” New York Department of Environmental Conservation Commissioner Basil Seggos said about the potential effect of cap-and-trade back in April.

“New York’s budget outlined broad details about how the revenues would be spent, creating a ‘climate action fund’ that would direct two-thirds of revenues toward ‘transitioning to a less carbon-intensive economy,’ while channeling other money to ‘industry small businesses’ and consumers,” Energy & Environmental News reported about the Empire State’s cap-and-trade program. “But the state still has to hash out which polluters will be able to buy allowances and contribute revenues to the program — a question that promises to be highly contentious.”

Though TCI has ceased to exist and details for the implementation of New York’s cap-and-trade program are not expected to be released until later this summer, RGGI is still alive and Governor Cooper has signaled his interest in the possibility of having North Carolina be a part of that cap-and-trade pact. In 2021, a spokesman for Governor Cooper confirmed that joining RGGI “is a policy option under consideration.” Under the cap-and-trade-blocking provision in the state House and Senate-passed budgets, however, Governor Cooper can consider joining a regional cap-and-trade program as much as he wants, but he and any future governor must get approval from the General Assembly in order to impose such a policy in North Carolina.

A conference committee will soon convene to hash out the differences between the House and Senate budgets over the next few weeks. The following chart from the John Locke Foundation, a Raleigh-based think tank, illustrates some of the key differences between the North Carolina House and Senate budgets.

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The details of the final North Carolina budget deal won’t be public until the conference committee releases them, which will likely occur in June. Yet Governor Cooper already knows he’s likely to receive a new budget that includes additional income tax relief he does not want, proceeds with the corporate tax phaseout that he has asked to halt, and prevents him from implementing cap-and-trade in North Carolina.

Despite all that, there are two key reasons why Governor Cooper may still end up signing the budget that the GOP-run General Assembly sends to him. The first is that he knows his veto will be overridden. The second is that Medicaid expansion, which has long been a top priority for Cooper, is contingent upon enactment of this new budget. As such, by July 4, North Carolina could be on track to have a 2.49% flat personal income tax and no corporate tax by the end of this decade.



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Risant Health plans to acquire North Carolina hospital system

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Risant Health plans to acquire North Carolina hospital system


Risant Health, the new organization founded by Kaiser Permanente, is planning to add its second hospital system.

Risant has announced plans to acquire Cone Health, based in Greensboro, North Carolina. Cone includes four acute care hospitals, a behavioral health facility, a health plan, and an accountable care organization caring for nearly 200,000 patients. Risant and Cone announced the plans late last week.

The move comes just a couple of months after Risant announced it had completed the acquisition of Geisinger Health in Pennsylvania.

In announcing its plans, Risant Health CEO Dr. Jaewon Ryu lauded Cone Health’s commitment to value-based care.

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“Cone Health’s impressive work for decades in moving value-based care forward aligns so well with Risant Health’s vision for the future of healthcare,” Ryu said in a statement. “Their longstanding success and deep commitment to providing high-quality care to North Carolina communities make them an ideal fit to become a part of Risant Health.”

“We will work together to share our industry-leading expertise and innovation to expand access to value-based care to more people in the communities we serve,” Ryu said.

The organizations will need to secure the approval of regulators to complete the deal.

Under the plans, Cone Health will operate independently but will take advantage of resources and support from Risant Health.

Cone Health will retain its name and brand identity, along with its current leadership team and board of directors, the organizations said. Cone employs 13,000 workers and has 1,800 physicians.

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Dr. Mary Jo Cagle, president and CEO of Cone Health, said joining Risant Health “presents a unique opportunity to shape the future of healthcare in the Triad, the state, and across the nation.”

“As part of Risant Health, Cone Health will build upon its long track record of success making evidence-based healthcare more accessible and affordable for more people. The people across the Triad will be among the first to benefit,” she said.

Risant has said its goal is to acquire community-based hospital systems focused on providing value-based care.

A nonprofit organization, Risant is based in Washington, D.C. Greg A. Adams, Kaiser Permanente’s CEO, is the chairman of Risant Health’s board and stressed the need for moving away from fee-for-service care.

“Risant Health has put a stake in the ground that care focused on evidence, equity, population health and improved outcomes must be the future of healthcare,” Adams said in a statement. “Models like that of Kaiser Permanente, Cone Health and Geisinger will help make that possible.”

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After completing its acquisition of Geisinger in the spring, Risant reiterated its plans to acquire “4 to 5 additional leading community-based health systems over the next 4 to 5 years.”

Cone Health serves an area with strong growth and benefits from a favorable payer mix, with Medicaid and self-pay accounting for less than a fifth of its 2022 revenue, according to Fitch Ratings. Fitch has given Cone Health a stable outlook. Cone Health’s Triad market also boasts some big employers, and Toyota recently announced plans to invest nearly $8 billion and add nearly 3,000 jobs to a battery production plant.

Mae Douglas, chair of the Cone Health board of trustees, said the North Carolina system’s leadership weighed the prospect of joining Risant for more than a year.

“Through this agreement, we will continue to improve upon our long tradition of providing health and well-being to those we serve,” Douglas said in a statement.

Cone’s flagship hospital, Moses H. Cone Memorial Hospital in Greensboro is a teaching hospital with 628 beds. Alamance Regional Medical Center in Burlington has 238 beds, Wesley Long Hospital has 175 beds, and Annie Penn Hospital offers 110 acute care beds.

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Kaiser Foundation Hospitals, a division of Kaiser Permanente, is designating up to $5 billion “to support core Risant Health capabilities, technologies, tools, and future investments,” according to financial documents filed last year.

Geisinger, which operates 10 hospital campuses and 134 healthcare sites, has kept its identity since being acquired by Risant Health.

Ryu served as president and CEO of Geisinger Health for five years before becoming the first CEO of Risant Health. Geisinger named Terry Gilliland, MD, as its new president and CEO.



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NC Senate gives initial approval to bill affecting mail-in voting, AI and local elections

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NC Senate gives initial approval to bill affecting mail-in voting, AI and local elections


RALEIGH, N.C. (WNCN) – The state Senate gave initial approval to a bill Tuesday with significant changes to the state’s elections, as Democrats accused Republicans of a “blatant power grab” when it comes to local elections.

The bill has a variety of provisions that also affect mail-in voting and the use of artificial intelligence in political ads.

The passed its second reading on 26-18 party-line vote. It’ll require an additional vote before it goes to the House.  

The legislation aims to address the use of generative AI to deceive or mislead voters by requiring disclosure of the use of that technology in political advertisements. The proliferation of “deepfakes” and deceptive videos is a chief concern to state election officials.

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Karen Brinson Bell, executive director of the NC State Board of Elections, recently said she worries about someone using her voice to create false messaging about the date of the election or other key information.

“I don’t know that there’s any state law that can 100 percent address that, but we need to try. We need to try to figure out a way to keep this kind of deceptive information from affecting our elections,” said Ann Webb, policy director of Common Cause North Carolina

The disclosure would be required when an ad is created entirely or in part with generative AI and: depicts a real person doing something that didn’t actually happen; was created to injure a candidate or deceive voters regarding a ballot issue; or provides false or misleading information to a voter.

Webb said she thinks the provision also should apply to digital ads.

Failing to comply would be considered a misdemeanor. That part of the law would go into effect July 1. However, Sen. Warren Daniel (R-Burke) said conversations are still underway with Republicans in the House, so the General Assembly may not take final action on the legislation until next year.  

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Republicans also want to move forward with requiring the state conduct signature matching of mail-in ballots to try to verify people are who they say they are.

They previously authorized a 10-county pilot study, which still is not done. NC State Board of Elections spokesman Pat Gannon said Tuesday the agency has contracted with BizTech Solutions to work with the counties on the pilot.

The technology aims to match someone’s signature on their absentee ballot envelope with the signature on file with the state.

Sen. Daniel (R-Burke) said even though the results of that pilot are still not available, he still wants to move forward with implementation. It would not take effect until 2025, meaning the first use would occur in lower-turnout local elections that year.

“Rather than kind of wait on the bureaucratic churn of that process, we’re going to go ahead and authorize that to be done in 2025 and beyond,” he said. “Here we are this long in the future waiting on the data from the Board of Elections. Probably most of us thought this would be implemented for this election.”

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North Carolina already requires people to either have two witnesses attest that someone is indeed the person who filled out a mail-in ballot or a notary public.

Sen. Dan Blue (D-Wake) questioned the need for the additional verification. He asked, “And you’re letting a machine that’s unproven basically say that that notary lied?”

Democrats objected to another part of the bill that would give the General Assembly greater ability to determine how county and city leaders are elected.

“It is one of the more blatant power grabs that we’ve seen,” said Sen. Julie Mayfield (D-Buncombe), adding that she thinks Republicans are likely to target heavily Democratic communities to potentially redraw local districts.

Sen. Daniel said Democrats aren’t being consistent in their arguments for proportional representation.

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The bill now goes to the House. Senate leaders say they don’t plan to hold any more voting sessions after this week regardless of whether Republicans can reach a compromise on issues like changes to the state budget.



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BJ’s Wholesale Plans New Clubs In New Jersey, North Carolina

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BJ’s Wholesale Plans New Clubs In New Jersey, North Carolina


BJ’s Wholesale Club is expanding in New Jersey and North Carolina.

BJ’s Wholesale Club is expanding in the east with new stores in the works in New Jersey and North Carolina.

Slated to open in early 2025, the warehouse club will open its 25th club in New Jersey’s Hanover Township. Its 10th North Carolina store will be located in Southern Pines.

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“We are excited to deliver the unbeatable value our membership offers to even more families in New Jersey and North Carolina,” said Bill Werner, executive vice president of Strategy and Development at BJ’s Wholesale Club. “As we continue to expand our footprint along the East Coast and beyond, we look forward to helping more families save up to 25 percent off grocery store prices every day.”



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