- [Kelly] Governor Stein offers his first state of the state address as the Senate passes bills to further limit Jeff Jackson's lawsuit abilities against Donald Trump.

This, State Lines.

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[upbeat music] ♪ [upbeat music continues] - Welcome to State Lines.

I'm Kelly McCullen.

Joining me today, former North Carolina State Senator, Mike Woodard.

Representative, Howard Penny Jr. of Howard and Johnston County's debuts.

Mr. Penny, welcome to the show.

Always give everyone a warm welcome to State Line.

- I'm so glad to be here.

I'm a long time viewer and the first time on here and I'm so, as we would say in Johnston County, I'm so proud to be here.

- [Kelly] We're glad to have you and you got a good team with you.

Representative Sarah Crawford of Wake County is here.

Good to see you as well.

- Great to be back.

Hope spring is treating you well.

And Brooke Medina joins us.

You got a new group.

Who are you affiliated with these days?

- I am with the State Policy Network.

- [Kelly] And what are they?

- So the State policy network is a convener of think tanks from all across the country.

So John Locke Foundation based in North Carolina, is a part of that network, but we serve 62 different affiliates from across all the 50 states.

- Oh, so you get a touch all around America now.

Previously from John Locke, who was also good friends of this show with their analytical expertise, Mr. Woodard.

- Absolutely.

- Well let's kick off with the state of the state address where North Carolina's new governor Josh Stein, had his first crack at giving one this week.

The entire room agreed with him on Helene recovery efforts.

And then the governor discussed middle class tax cuts and education spending and, you know, issues the Republicans have an opinion on.

- We can cut taxes to make childcare more affordable.

We can cut taxes on working families to put more money in their pockets, lift children out of poverty and stimulate local economies.

These three targeted tax cuts are what being pro-family looks like.

- We've cut taxes, leaving more money in the hands of working families and entrepreneurs.

We've cut red tape that chokes small businesses and drives up housing costs, because every North Carolinian should have the opportunity to get a good job and afford a home.

- All right, Mike caught us peeking at the monitor and joy in the little clip of the speech, but Josh Stein's tone and Destin Hall's tone.

You saw both things.

What'd you make of it?

- Great bipartisan tone in both speeches and let's hope that some of that bipartisan feeling we had will carry on through the session.

Kudos to the governor for keeping the speech under two hours, unlike other state of the unions that we heard recently, about 40 minutes, half of it was Helene, which I think we all expected.

And for me, one of the news items that came out of it was the governor's proposal for the $4 billion school bond.

I know we've been kicking that one around the General assembly for some time and we'd love to see some action on that.

The capital needs in our schools are pretty severe and it'd be a great way to address it.

- We got two house votes here, at least we can talk about that.

But Representative Penny, the speech, Josh Stein laid it out.

I didn't think he was attacking Republicans.

I think he challenged the Republican caucus and oftentimes I saw Republicans clapping for education spending.

So where did Mr. Stein get it right with your caucus and where does he have some work to do to reach across the aisle?

- Well, obviously he's very, very new in the job so far, but particularly, [clearing throat] excuse me, I'm on the Hurricane Helene Relief large committee and so far I personally, and I think most of my colleagues are very impressed by the caliber of his appointees that he's brought in because of the situation we had with Matthew and Florence and the loss of money there.

And so far I, you know, I'm looking forward to working with our governor.

- Representative Crawford, he's not the first Republican, and not on this show, off-camera, say you can do business with Josh Stein.

And so far, Republicans are giving him a pass.

Polls out from John Locke Foundation.

54, 55% approval for Stein.

- Yeah.

- So, we had a State of the State Address.

We all know, it's just a nice speech.

It keeps you at work into the night some nights.

But your take on it, North Carolina had a chance to see their governor and to see the new House Speaker.

- I think Governor Stein is off to a great start.

To your point, the numbers are in and they show it as well.

And I thought the speech really did a great job of striking the right bipartisan balance.

You know, I sit over on the side of the House where the Democrats sit, and I was very happy to look over at my Republican colleagues multiple times, standing up with us, clapping.

I think Josh has done a good job reaching across the aisle, and I hope that we can get some of these things done.

Teacher pay is critical, and we've already seen some bills be introduced on that.

- Brooke, the tone of that room was different than the State of the Union.

And we did a little live show here in between the two speeches.

There were no gimmicks.

There was no showboating.

Republicans were polite.

Democrats were also very polite.

Enthusiastic, of course.

What do you make of the tone of this?

How are Raleigh politics, for all its partisanship, different than what we're seeing on the cable news networks out of Congress?

- Yeah, I think it's healthier.

I mean, you're more inclined usually to be able to get along with your neighbors and more incentivized to do so.

And here in North Carolina, despite the wide disagreement sometimes on certain policy issues, there is a genuine love for North Carolina that is infused within public policy across the state.

And also there's an ability to call balls and strikes in ways that I don't think at the federal level there's just a lot of showboating.

There is a lot of political circusing.

And at the state level, I think lawmakers know they've got to get their job done.

They can't just continue to grandstand like at the federal level.

So to me, that's a healthier thing and it's encouraging to see.

- Mike, I'm gonna make this segment way too long for our purposes, the producers will be going crazy, but you brought up that $0.4 billion education bond.

We'll start there.

I want to move to the tax cut package, but $4 billion.

I remember a day in time when Republicans would argue when you pass a balanced state budget and when you do a bond, you're deficit spending.

- You know, you borrow to buy a house.

You borrow to buy a car, oftentimes.

There are capital needs sometimes that are not gonna be able, you're not gonna be able to put into the state budget.

We used to call it "PAYGO", pay-as-you-go.

You know, I know a school in Granville County where that I used to represent.

They have to replace a roof on the elementary school.

It's a $7 million expense to replace the roof on the school.

- [Kelly] Wait, the school?

A school?

- A school.

One school.

One elementary school in Granville County is a $7 million repair to replace the roof.

They don't have that kind of capital just sitting around.

They're spending it on buses, and lunches, and books, and all kinds of things.

So, you know, bond funding can help.

We've seen it.

North Carolina has a AAA bond rating.

We have the Local Government Commission in place.

There can be good borrowing.

And I think the governor's right.

I think it's time for us to invest in our public schools.

We've undercut them so often.

I saw, I think I saw Representative Penny stand up when we talked about community college instructor salary.

- Absolutely.

- And you have been a champion of that as a new community college trustee.

Those are things we can invest in.

- What's the conservative play on education funding?

I heard Pare stood up as well and she's got a bill to raise teacher pay.

It seems like, I won't say people are moving left in the conservative caucus, but.

- Forward.

- Representative Penny, you're sandwiched, I hate to tell you.

- No, not a problem.

I was County commissioner chair prior to coming to the legislature and coming from a rural county without having a good bond rating and having be able the ability to borrow monies and to help the LGC like he was saying, and then Dun and Bradstreet, tell us what we could, our debt affordability, in a rural county, we would not have been able to build the buildings we have built.

So what's the difference going forward at the state level to do the same thing?

In my opinion, we're woefully behind across this state in school buildings.

- Is bonds a good way to do that from your perspective?

- Again, if I had to do it as a county commissioner chair, I don't see what the difference is doing as a legislator.

Now, my colleagues in the house leadership may not agree, but I don't personally have a problem with it.

- Representative Crawford, there was mixed applause for a bond, other things, perceived cheers, no cheers for $4 billion in state debt for this, whether it's schools or roads or anything else.

- Well, again, I'm gonna be with Senator Woodard and I'm still gonna call him Senator forever.

I'm gonna be with Senator Woodard on this.

I think we have got to make these critical investments in our infrastructure and we've gotta figure out how to do it.

And what I will say, we have made some decisions over the last several years that have hurt our state budget.

We've seen the revenue projections, the forecast for this coming year, and we're gonna have some tough years ahead of us.

And that's because of giving handouts to the wealthiest corporations in the states.

So we need to freeze some of that and move forward and help our middle class, help our schools.

- Go, Brooke.

[panel chuckling] - The federal government on the tails of COVID lockdowns sent the state of North Carolina $6 billion for education.

Only 10% of that money had to go toward learning loss.

Where did the rest of the money go?

So why do states, we don't even know.

Why does the state still ask for more money when it still has possibly billions of dollars still sitting there of federal COVID relief money that was not properly accounted for.

There was not proper accountability measures in place to ensure that that funding was prepped properly.

So to incur more debt for taxpayers that increases their taxes, I do not think is a wise use of taxpayer money, especially given where the economy's at right now.

- We could not have a more perfect segue where State House speaker representative Destin Hall, has released some online videos, I guess a Twitter, I dunno if he's on TikTok or not, supporting a house, DOGE-style subcommittee.

That committee is formed, it's with Republican representatives, Keith Kidwell and John Torbet as co-chairman, governor Stein now has proposed a DOGE-style committee under his executive branch.

Of course he's not gonna call it DOGE, it's so much more enlightened.

And I've checked in with senate leaders and their colleagues and I have been reminded, Brooke, our state elects an auditor, and we already have a joint legislative oversight committee that predates DOGE and has been looking at government operations for decades or years at least.

Teed you up for that one, you set me up for that one.

DOGE in North Carolina, it's very interesting and is popular depending on how you define it.

- Yep, and I think right now this is a PR sort of play, which is, even though the state does have the auditor, there are elements that are already in place here in North Carolina.

The public consciousness is on DOGE.

They're thinking about that.

We're seeing it sweep across the state.

South Carolina is doing this, Alabama's doing this, Louisiana is, North Carolina, focusing on it, I think is smart, especially when there is uncertainty at the federal level with congressional budget talks.

What is the state going to have to do on the Medicaid front?

What are some costs that they're going to incur regarding that?

So when you can eliminate fraud, waste, and abuse within government, that's best, and the voters support it.

So here in North Carolina, according to that "Carolina Journal" poll that was released yesterday, overwhelming number of North Carolina voters give a thumbs up to DOGE.

- Representative Crawford, I've seen the memes already, Democrats are down on the lawn.

Protesting DOGE right before Governor Stein goes out and says, "I want my impact committee to look at government spending with a scalpel, not a hammer."

Oh, that ruins the party.

- Well, look, we have had so many opportunities.

I am all about, all for government accountability and transparency.

And I think what we need to do is, in this moment, as we're talking about these DOGE-style subcommittees, we really need to remember that we've had a few protections in place already, as you mentioned, but we had some protections in place that North Carolina Republican leadership took away.

And that includes transparency laws around what's public record.

They exempt themselves, lawmakers, from having any of their emails, any of that be a part of public records, FOIA requests.

No longer do we have to respond to those.

That takes away transparency and accountability.

We also...

I think it was in 2021.

Republican lawmakers did away with the non-partisan Program Evaluation Division.

This was a non-partisan group that had the responsibility to be the fiscal dog watch, fiscal watch, for the taxpayer money.

And they did away with that and they replaced it with a Gov Ops partisan group that has just, you know, really a lot of authority that they shouldn't have.

- Representative Penny, this DOGE idea wasn't cool until all of a sudden it became really popular and really popular for both sides of the aisle.

How does this work and is there something wrong with what Dave Boliek's trying to do?

Why do we need all these committees?

- Well, I personally like Dave Boliek, and I think we've empowered him to do a lot.

- [Host] Okay.

- Obviously he's one man, so I've been carefully watching who he's put on his team.

But a few facts I'd like to bring out.

If you had a million dollars in $100 bills, they would be about as tall as this table right here.

So let's talk about the trillion dollars in debt this nation has got.

That's enough $100 bills, stacked horizontally, to reach from Raleigh to Disney World.

And so think about our debt.

It's $36.5 trillion.

That's enough to go past the moon into outer space.

And so where I'm going with all this, regardless if we're Republicans, Democrats, whatever we are, it's an American problem that our grandchildren, great-grandchildren, are going to inherit.

So whatever we can do, either statewide or nationally, to get our debt down.

We've got to live within our means.

Is what has been happening at the national level very drastic?

Probably.

Does it have to be done?

More than likely.

So this committee that's been formed, and I'm sure Representative Crawford would tell you the same thing, and the senator, there's lots of committees that's appointed in the House and the Senate.

You're given a title.

I've served on plenty of them.

Basically, you do your report, you report it back to the leadership, and you may see it in the budget or you may never hear from it again.

So I hope we're looking at this as North Carolinians and looking to solve a serious problem that we do have.

- Mike, this is an efficiency play.

The state must pass a balanced budget.

We don't have deficit spending in North Carolina.

- Right.

- So Josh Stein's DOGE committee could find quite different priorities than, I would think, Representative Kidwell and Representative Torbett in the House.

- I hope these two efforts can come together around the GE part of this: government efficiency.

Governor Stein I think got his dig in.

He said he wanted this to work with a scalpel, not a chainsaw, a clear shot across the bow at Elon Musk and the props that he used at a recent CPAC meeting.

And I hope that's the way we'll look at this, as government efficiency.

I think Auditor Boliek has correctly called out that he has a job to do.

He was elected by the people to do it.

I think he will be a good auditor.

But he's already said, I need some more positions if you want me to do this.

And so, I hope you all will find a way to fund the auditor and let him do his job.

Let these committees advise, and let's work for government efficiency.

- Amen.

- Brooke, in the video, Representative Hall says, or Speaker Hall says that they're gonna look into local government and local government operations.

Why is it any business of a state legislator to look into a city's finances beyond just what the state government gives them in funding?

- Well, we know that there are some cities in North Carolina or small townships that have almost gone underwater before.

It is important for the sake of, those people are North Carolinians too.

And so it should be a two-way street where local governments are also holding accountable the state level officials and vice versa.

That's the core of federalism.

That's really important for that to be a two-way street.

And so taxpayers are all for accountability.

That's what North Carolinians want.

They wanna see their government very competent.

So to me, that's a good thing.

- From a philosophical perspective, should legislators who write the state budget, therefore funding the animal if you will, should they be the ones in charge with finding the efficiencies in the creature they feed and create, versus an executive branch like Donald Trump and Elon Musk, where that committee answers to the executive of the state who oversees operations?

- Well, I'm a big believer in separation of powers, but I also believe they should be holding each other accountable.

So if both of them wanna work on it and make us more efficient, all for it.

- I can't wait to see the reports.

We'll have other things to talk about in other shows.

Only about 40 more to do this calendar year, Senate Republicans have passed their bill to stop Attorney General Jeff Jackson from joining lawsuits against President Donald Trump's executive orders.

A similar bill is sitting over in the State House, so the process is still quite early.

Democrats say Attorneys General should have the freedom to represent the people that elect the AG.

Even Attorney General Jackson says, Representative Penny, this bill prevents him from challenging Trump executive orders including those that will cut billions of dollars from our state universities through research grants that have now been clipped, and, well, the bill's coming your way, or you can do your own bill and negotiate it.

But Jeff Jackson not being able to challenge executive orders and in his mind, saved billions of dollars if he could.

- Well, you hit it correctly.

This came in from our colleagues in the Senate.

The House has not took an opinion were we even going to consider it or not, but I understand the frustration that our voters have in the AG focused on fighting Trump.

We've got enough internal problems.

We've got fentanyl problem in this state.

We've got illegal aliens in this state.

We've got all sorts of things going on in this state.

To me, I want my attorney general to be focusing on North Carolina.

I didn't say if our federal government gets outta whack that he does not need to defend us there.

But I think we need to focus on inside of our state borders.

- Mike, is there a focus issue with these state attorneys general, even across America trying to give themselves an elevated brand name by going after Donald Trump when they have governors and legislators they could be working with?

- You know, remember when we're elected, we all take an oath of office to support the constitution, not to support one elected official, one level of government, The Constitution.

Attorney General Jackson took that same oath of office and I think that the AG is looking at some of these executive orders and saying, I'm not sure these are constitutional.

You know, particularly when, I'm glad to hear Brooke say she likes the executive branch of government because when the legislative branch starts, or when the executive branch starts taking legislative branch power, which some of these executive orders have done, then I think it's time for attorneys general, whether they're Republican or Democrat across the country to step up and say these are unconstitutional, and they hurt my state and the people who elected me and that I represent.

And so I'm supportive of the efforts when the Attorney General, whatever party they may be, whatever state they represent, step up and say, "I don't think this is constitutional."

And just this week, within the last 24 hours, we've seen two judges step in at the federal level and tell the Trump administration, "What you're doing is not constitutional.

Hire people back.

Turn on these funds again that you've taken away."

- Brooke, on this one, I've been around legislature a while, I've never seen so many bills that go to remove power incrementally from one office.

I know it's happened historically.

The Lieutenant Governor of North Carolina lost a lot of power back in the late '80s.

This is not unprecedented, as much as people want us to believe, but have politics changed where the Attorney General's position needs to have a well-defined role as prescribed by law, according to Republicans?

- Yeah, it needs to follow whatever the constitution of that state outlines.

- [Kelly] Well, North Carolina, let's think of state lines as North Carolina.

- And so it is within the purview of the General Assembly to help define those contours and bring that to the voters if they're gonna be changes later down the road.

But I think what is at the crux of this is what you said, the role of Attorney General has changed so much over the years, and so there is a lot of political grandstanding that has started to happen with state AGs on both sides of the aisle.

They coalition together and they start to try to make political statements, rather than being their state's chief attorney.

And I think that there is a properly delegated role to the General Assembly to curtail some of that political grandstanding and actually get the job done, and hold them to get their job done as well.

- Don't want to put you on the spot, but there are these think tanks out there on the left and the right, and do they influence these groups of State Attorneys General to get together?

And other legislative issues as well, is that part of the job of the left and right to influence at the state level like this?

So someone's telling Jeff Jackson, "This is a great idea," and someone's telling Republicans "Stop this!"

- Mm-hmm, yeah, I mean, think tanks are part of a bigger, broader movement, a political advocacy that looks in a lot of different ways, depending on the state that it's in.

So here in North Carolina, there is a more left-leaning think tank, the North Carolina Justice Center, and then the right-leaning one is John Locke Foundation, and they have their own public policy advocacy strategies and focuses, but I can speak for, at least on the John Locke Foundation side, having just come from there, it is focused on limited government fiscal conservatism and making sure that things abide by the rule of law as delegated by the Constitution.

That should make sense.

- Representative Crawford, Jeff Jackson's in the job, most famous Attorney General already after a month and a half.

I've never seen so much noise outside and inside that building.

He knew this was coming, he had to!

- Well, y'know, I think, look, Attorney General Jeff Jackson is very smart, and having served with him in the Senate for a couple years, I'm not surprised at all that he is among the most famous, or the most famous, as you have said, Attorney General in the country.

Y'know, I think he probably did know that this was coming, right?

I mean, y'know, we knew it.

But his job is to defend the Constitution of the United States and the Constitution of North Carolina, and he is a very important, his role, the Attorney General's office, whether it's Jeff Jackson or somebody else, that role plays a really important role in our process of checks and balances and making sure that we protect the people in North Carolina.

- Stay right there, coming back to you, 'cause I want to talk about the Republican vote in the Senate to end DEI.

The officers, the job positions, the academic curricula from North Carolina public schools.

This Senate bill would ban teaching of concepts like, as I read it, one race being inherently superior to another or that one race of people is inherently racist, sexist, or oppressive.

Teaching students that they are responsible for actions of their ancestors would also be banned.

University system phased out.

DEI programs and offices in 2024 as a policy change.

And as a matter of transparency, PBS North Carolina is part of the UNC system.

Always have to say that.

Another brick removed from the DEI movement as it pertains to North Carolina government and policy.

- Yeah, again, I think no surprise here that this was coming.

It did pass the Senate earlier this week, as you said.

And it is a very troubling step backwards.

You talked about some of the "divisive" issues that are included in this bill, but let's talk about what DEI is and what it is not.

DEI is really about making sure that our students are prepared for the world, that they understand their history so that we don't repeat it.

That is why we learn history, so that we can learn from it, don't make mistakes of the past.

This bill is not about protecting our students.

It's about protecting comfort zones.

And there's a really important piece in here that goes beyond these "divisive" issues.

There's a piece in here that says teachers are banned from getting education on diversity issues that make their classrooms more inclusive, that help their classrooms, their students feel more included, and I just don't know why we would put ourselves in a position of banning that.

This is like saying... You know what?

Banning DEI is like saying, "We're gonna stop teaching students to stand up to bullies because it makes the bullies feel bad."

And, you know, I don't think anybody here wants to do that.

We cannot move forward, you know, without learning about our past.

We can't just sweep history under the rug because it makes us uncomfortable.

- Representative Penny, a popular issue with Republicans and both Republican caucuses.

We have about one minute left.

I'll give maybe the final word to you, sir.

- Well, this is a bill that obviously came here from the Senate.

We've not really looked at it yet, but I think we need to have a healthy conversation.

I think that's what my colleague has just said.

We need to have a healthy conversation about it.

But in my 30+ years in all sorts of local government, I believe in hiring the most qualified person.

I don't think race, skin color, ethnicity should ever come into it.

I think we should always hire the most qualified person.

- And I'll let that be the final word.

Mike, representative, representative, good to have you on the show.

Great debut, sir.

We'll have you back.

Brooke, always good to have you.

Even better to have you watching this program and listening to us.

Email your thoughts and opinions to statelines@pbsnc.org.

We'll read every email, send a few to this crowd if they're really good.

I'm Kelly McCullen.

Thank you so much for watching and I hope to see you next time.

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