AN ACT to continue current directions and limitations on the expenditures of state funds, to AUTHORIZE THE USE OF THE SAVINGS RESERVE ACCOUNT TO BALANCE THE BUDGET, TO PROVIDE THAT THERE BE NO AUTOMATIC STEP INCREASES FOR STATE and public school EMPLOYEES, TO SET THE CONTRIBUTION RATE TO the TEACHERS' AND STATE EMPLOYEES' RETIREMENT SYSTEM, TO APPROPRIATE FUNDS FOR HEALTH AND HUMAN SERVICES BLOCK GRANTS, NATURAL AND ECONOMIC RESOURCES BLOCK GRANTS, AND FOR WORKER TRAINING TRUST FUND PROGRAMS, and TO maintain 2001‑2002 participation levels in the AIDS Drug Assistance Program.

The General Assembly of North Carolina enacts:

directions and limitations on expenditures of state funds
SECTION 1.(a) The appropriations and the authorizations to allocate and spend funds, which are set out in this act, shall remain in effect until the Current Operations and Capital Improvements Appropriations Act of 2002 becomes law, at which time that act shall become effective and shall govern appropriations and expenditures. When the Current Operations and Capital Improvements Appropriations Act of 2002 becomes law, the Director of the Budget shall adjust allocations to give effect to that act from July 1, 2002.
Except as otherwise provided by this act, the limitations and directions for the 2002‑2003 fiscal year in S.L. 2001‑424, S.L. 2001‑457, S.L. 2001‑514, S.L. 2001‑513, S.L. 2001‑496, and S.L. 2001‑487 remain in effect. Session laws that applied to appropriations to particular agencies or for particular purposes apply to the funds appropriated and authorized for expenditure under this act.
SECTION 1.(b)  If the provisions of either Senate Bill 1115, 3rd Edition or Senate Bill 1115, as it passes the House of Representatives; or both, direct that funds shall not revert, the funds shall not revert on June 30, 2002.  Unless these funds are encumbered on or before June 30, 2002, these funds shall not be expended after June 30, 2002, except as provided by a statute that becomes effective after June 30, 2002.
SECTION 1.(c)  Subsection (b) of this section becomes effective June 30, 2002.

Use of Savings Reserve ACCOUNT to Balance Budget
SECTION 2.  G.S. 143‑15.3(b) prohibits the Director of the Budget from using funds in the Savings Reserve Account unless the use has been approved by an act of the General Assembly. The General Assembly hereby authorizes the Director of the Budget to use funds that were credited to the Savings Reserve Account on or before June 30, 2002, to the extent necessary to balance the State budget for the 2001‑2002 fiscal year, and funds are hereby appropriated from the Savings Reserve Account for this purpose.

No Automatic Step increases for STATE and public school Employees
SECTION 3.  State employees subject to G.S. 7A‑102(c), 7A‑171.1, or 20‑187.3 shall not move up on salary schedules or receive automatic increases, including automatic step increases, until authorized by the General Assembly.
Public school employees paid on the teacher salary schedule or the school‑based administrator salary schedule shall not move up on salary schedules or receive automatic step increases until authorized by the General Assembly.

RETIREMENT CONTRIBUTION RATE
SECTION 4.  Section 32.21(b) of S.L. 2001‑424 reads as rewritten:
"SECTION 32.21.(b)  The State’s employer contribution rates budgeted for retirement and related benefits as percentage of covered salaries for the 2002‑2003 fiscal year are (i) three and three hundredths percent (3.03%) – Teachers and State Employees; (ii) eight and three hundredths percent (8.03%) – State Law Enforcement Officers; (iii) nine and seventy‑one hundredths percent (9.71%) – University Employees’ Optional Retirement System; (iv) nine and seventy‑one hundredths percent (9.71%) – Community College Optional Retirement Program; (v) thirteen and sixty-seven hundredths percent (13.67%) – Consolidated Judicial Retirement System; and (vi) two and thirty-five hundredths percent (2.35%) –  Legislative Retirement System. Each of the foregoing contribution rates includes two and thirty‑five hundredths percent (2.35%) for hospital and medical benefits. The rate for Teachers and State Employees, State Law Enforcement Officers, Community College Optional Retirement Program, and for the University Employees’ Optional Retirement Program includes fifty‑two hundredths percent (0.52%) for the Disability Income Plan. The rates for Teachers and State Employees and State Law Enforcement Officers include sixteen‑hundredths percent (0.16%) for the Death Benefits Plan. The rate for State Law Enforcement Officers includes five percent (5%) for Supplemental Retirement Income."

DHHS block grants
SECTION 5.(a)  Appropriations from federal block grant funds are made for the fiscal year ending June 30, 2003, according to the following schedule:

COMMUNITY SERVICES BLOCK GRANT

01.	Community Action Agencies	$ 14,160,375

02.	Limited Purpose Agencies	979,017

03.	Department of Health and Human Services
to administer and monitor
the activities of the
Community Services Block Grant	500,000

TOTAL COMMUNITY SERVICES BLOCK GRANT	$ 15,639,392

SOCIAL SERVICES BLOCK GRANT

01.	County departments of social services	$ 22,895,663

02.	Allocation for in‑home services provided
by county departments of
social services	2,101,113

03.	Adult day care services	2,155,301

04.	Department of Administration
for the N.C. State Commission of Indian Affairs
In‑Home Services Program for the Elderly	203,198

TOTAL SOCIAL SERVICES BLOCK GRANT	$ 27,355,275

LOW‑INCOME ENERGY BLOCK GRANT

01.	Energy Assistance Programs	$ 8,092,113

02.	Crisis Intervention	5,795,825

03.	Administration	1,984,934

04.	Weatherization Program	2,684,116

05.	Department of Administration – 
N.C. State Commission of Indian Affairs	39,765

06.	Heating Air Repair and Replacement Program	1,252,588

TOTAL LOW‑INCOME ENERGY BLOCK GRANT	$ 19,849,342

MENTAL HEALTH SERVICES BLOCK GRANT

01.	Provision of community‑based
services for severe and persistently
mentally ill adults	$ 5,192,826

02.	Provision of community‑based
services to children	2,378,540

03.	Comprehensive Treatment Services
Program for Children	1,500,000

04.	Administration	783,911

TOTAL MENTAL HEALTH SERVICES BLOCK GRANT	$ 9,855,277

SUBSTANCE ABUSE PREVENTION
AND TREATMENT BLOCK GRANT

01.	Provision of community‑based
alcohol and drug abuse services,
tuberculosis services, and services
provided by the Alcohol and Drug Abuse
Treatment Centers	$ 14,501,711

02.	Continuation of services for
pregnant women and women
with dependent children	6,007,303

03.	Continuation of services to 
IV drug abusers and others at risk 
for HIV diseases	5,209,934

04.	Provision of services to children
 and adolescents	6,839,190

05.	Juvenile Services – Family Focus	774,414

06.	Comprehensive Treatment Services Program	700,000
		
07.	Administration	2,423,049

TOTAL SUBSTANCE ABUSE PREVENTION 
AND TREATMENT BLOCK GRANT	$ 36,455,601

CHILD CARE AND DEVELOPMENT FUND BLOCK GRANT

01.	Child care subsidies	$148,343,839

02.	Quality and availability initiatives	17,259,661

TOTAL CHILD CARE AND DEVELOPMENT FUND
BLOCK GRANT	$165,603,500

TEMPORARY ASSISTANCE TO NEEDY FAMILIES
(TANF) BLOCK GRANT 

01.	Work First Cash Assistance	$114,181,958

02.	Work First County Block Grants	92,018,855

TOTAL TEMPORARY ASSISTANCE TO NEEDY FAMILIES
(TANF) BLOCK GRANT	$206,200,813

MATERNAL AND CHILD HEALTH BLOCK GRANT

01.	Healthy Mothers/Healthy Children
Block Grants to Local Health
Departments	9,838,074

02.	High‑Risk Maternity Clinic Services,
Perinatal Education and Training, 
Childhood Injury Prevention,
Public Information and Education, and
Technical Assistance to Local Health
Departments	2,012,102

03.	Services to Children With Special Health
Care Needs	5,078,647

TOTAL MATERNAL AND CHILD
HEALTH BLOCK GRANT	$ 16,928,823

PREVENTIVE HEALTH SERVICES BLOCK GRANT

01.	Statewide Health Promotion Programs	$3,061,182

TOTAL PREVENTIVE HEALTH SERVICES BLOCK GRANT	$3,061,182

SECTION 5.(b)  Decreases in Federal Fund Availability. – If the United States Congress reduces federal fund availability in the Social Services Block Grant below the amounts appropriated in this section, then the Department of Health and Human Services shall allocate these decreases giving priority first to those direct services mandated by State or federal law, then to those programs providing direct services that have demonstrated effectiveness in meeting the federally and State‑mandated services goals established for the Social Services Block Grant.  The Department shall not include transfers from TANF for specified purposes in any calculations of reductions to the Social Services Block Grant.
If the United States Congress reduces the amount of TANF funds below the amounts appropriated in this section after the effective date of this act, then the Department shall allocate the decrease in funds after considering any underutilization of the budget and the effectiveness of the current level of services. Any TANF Block Grant fund changes shall be reported to the Senate Appropriations Committee on Health and Human Services, the House of Representatives Appropriations Subcommittee on Health and Human Services, and the Fiscal Research Division.
Decreases in federal fund availability shall be allocated for the Maternal and Child Health and Preventive Health Services federal block grants by the Department of Health and Human Services after considering the effectiveness of the current level of services.
SECTION 5.(c)  Changes to the budgeted allocations to the block grants appropriated in this act and new allocations from the block grants not specified in this act shall be submitted to the Joint Legislative Commission on Governmental Operations  for review prior to the change and shall be reported immediately to the Senate Appropriations Committee on Health and Human Services, the House of Representatives Appropriations Subcommittee on Health and Human Services, and the Fiscal Research Division.
SECTION 5.(d)  The appropriations and the authorizations to allocate and spend funds, which are set out in this section, shall remain in effect until the Current Operations and Capital Improvements Appropriations Act of 2002 becomes law, at which time that act shall become effective and shall govern appropriations and expenditures.  When the Current Operations and Capital Improvements Appropriations Act of 2002 becomes law, the Director of the Budget shall adjust allocations to give effect to that act from July 1, 2002.

maintain AIDS Drug Assistance Program (ADAP)
SECTION 6. Notwithstanding Section 21.90 of S.L. 2001‑424, eligibility for participation in the Aids Drug Assistance Program between July 1, 2002, and August 1, 2002, shall continue at the levels established for the 2001‑2002 fiscal year in S.L. 2001‑424.

NER BLOCK GRANT PROVISIONS
SECTION 7.  The Director of the Budget shall continue to allocate federal block grant funds at the levels provided in Section 5.2 of S.L. 2001‑424 and as otherwise provided by law, and appropriations from federal block grants are hereby made.

WORKER TRAINING TRUST FUND APPROPRIATIONS
SECTION 8.  The Director of the Budget shall appropriate funds from the Worker Training Trust Fund at the levels provided in Section 20.6 of S.L. 2001‑424 and as otherwise provided by law.  If the funds available for appropriation from the Worker Training Trust Fund in the 2002‑2003 fiscal year are less than those appropriated from the Fund in the 2001‑2002 fiscal year, then every program receiving an appropriation from the Fund in the 2001‑2002 fiscal year shall receive an appropriation in the 2002‑2003 fiscal year that is reduced by the same percentage as the reduction availability in the Fund.

EFFECTIVE DATE
SECTION 9.  Except as otherwise provided in this act, this act becomes effective July 1, 2002, and expires July 31, 2002.
In the General Assembly read three times and ratified this the 27th day of June, 2002.

	s/	 Beverly E. Perdue
	 President of the Senate

	s/	 James B. Black
	 Speaker of the House of Representatives

	s/	 Michael F. Easley
	 Governor

Approved 1:33 p.m. this 27th day of June, 2002