Latest / The SEANC View / Retirement system makes huge gains, so where are the COLAs?

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Retirement system makes huge gains, so where are the COLAs? · The SEANC View

• 0:11
  Hello, and welcome to another edition of the Scenic View podcast.
• 0:14
  I'm your host, Jonathan Owens, along with Artis Watkins and Samantha Klein.
• 0:19
  Oh, I upgraded myself to host this week, so.
• 0:22
  Hey, why not? That's what you do. You host it. Yeah, I'm the host, right?
• 0:27
  So the legislature, well, the House is back in town this week, right, Artis?
• 0:34
  Yes, in it last week, House this week. But we don't expect any big news for
• 0:38
  state employees to come out of this week.
• 0:41
  They've spent a lot of their time today talking about the THC bill that's before
• 0:46
  them. We may discuss that a little bit more at the end of the show in the Gen Z moment.
• 0:51
  But for now, is there anything else we need to talk about from the legislature?
• 0:55
  Well, I mean, I think the main thing our members are concerned about with the
• 1:00
  legislature is the thing that's not being discussed down there,
• 1:03
  which is, okay, there's more money that has not been spent, the billion dollars that was set aside.
• 1:10
  And there are actually in a couple of technical corrections bills,
• 1:15
  there's a little bit more spending.
• 1:16
  There's more spending on the SBI for some vehicles and then a big chunk,
• 1:22
  I can't remember what it's for, but for the SBI to properly fund them.
• 1:26
  And then there is actually in the technical correction, some cuts to HHS positions.
• 1:33
  So there's some spending and cutting going on in these cleanup bills.
• 1:39
  The question still remains, we had all this money, the billion dollars that
• 1:42
  was set aside, what's going to happen with that?
• 1:46
  And why can't they just seize the moment?
• 1:49
  Since they passed the budget, the health care costs have gone up for state employees and retirees.
• 1:56
  You know, let's spend some of that money that was left on the employees.
• 2:00
  Because don't forget the reason we're seeing big chunks of money each year that
• 2:06
  are left over and they become reserves.
• 2:09
  In large part, that's because of the vacant positions.
• 2:14
  And those positions, as we've established umpteen times, including with agency
• 2:19
  heads in here, they're not usually vacant because they're not needed.
• 2:24
  That does happen sometimes because agency heads have said they used that money
• 2:28
  to pay bills, which is not good either.
• 2:30
  But they're usually vacant because they can't find people to take the job at what the state pays.
• 2:35
  So other people have to make up for the work of the missing person.
• 2:40
  And state employees have been doing that. They've been doing the work of more than one person.
• 2:44
  It's created money that's available, and yet that money hasn't been turned around to use on them.
• 2:50
  It's like we've said these surpluses are always built on the backs of our employees
• 2:55
  because they have to work more to make up for the people who aren't there, right? The vacant job.
• 3:00
  100%. So, yeah, that's what people wanted to see out of the legislature.
• 3:05
  There's not any talk of doing that, though.
• 3:09
  And you did touch on health care a little bit there.
• 3:12
  There's no real update from the state health plan tier structure issue right
• 3:17
  now between Atrium and the state health plan. We haven't had any updates on that.
• 3:23
  Right. So Atrium had discussions, as we said last week, with the treasurer's
• 3:27
  office that they did a joint public statement about that they're just trying
• 3:32
  to work it out to where Atrium wants to be either accessed or preferred provider tier.
• 3:37
  It seems as though Atrium has not offered a good enough deal to do that.
• 3:42
  And they're still, according to both parties, Atrium and the health plan,
• 3:47
  they're still trying to work that out and negotiating it.
• 3:51
  Now, the irony there is, I've seen even some lawmakers who seem to think that
• 3:56
  Atrium found out about the preferred provider tier a few weeks ago when we all did.
• 4:03
  But the treasurer's timeline shows they've known about it for a year.
• 4:07
  Yeah, I've seen a few videos from legislators that I don't want to call them
• 4:12
  uninformed, but it seems like maybe they're buying a little bit of atriums,
• 4:17
  what atrium's putting out, you know.
• 4:19
  And I think that's easy to do. You're getting the big PR machine,
• 4:22
  as we've talked about, is incredibly well funded by the big hospitals.
• 4:28
  Yeah. And that brings us to another point.
• 4:30
  Not all hospitals, and we say this a lot, and I noticed a comment on LinkedIn
• 4:35
  in a discussion around all of this stuff from someone who, Dr.
• 4:39
  Willis, who used to be on the Health Plan Board of Trustees.
• 4:42
  He made a comment that I think is so important. You can't say hospitals when
• 4:47
  you talk about the greed of some major health care systems.
• 4:51
  And we all tend to do that. These hospitals are just wanting to be overpaid.
• 4:56
  There are many hospitals that
• 4:58
  are barely making it, not deeply administratively, you know, laden down.
• 5:06
  They're really spending their money on doctors and nurses and care.
• 5:09
  And so I'm trying to do better about not just saying hospitals.
• 5:15
  It's like Thomas Friedman said, you know, 90 percent of the hospitals in the
• 5:19
  state are on an access or preferred plan. I mean, I'm sure not all of them are. Right.
• 5:28
  The irony is not lost on anybody, though, that the richest one,
• 5:31
  the one with the $10 billion reserves, whereas the state of North Carolina only
• 5:36
  has $4.2 billion in reserves.
• 5:39
  The $10 billion reserve hospital, Atrium, that's wanting to buy WakeMed,
• 5:44
  who's got the billion-dollar reserve, they're the ones holding out.
• 5:48
  And another thing that Thomas talked about, I wonder if Atrium does negotiate
• 5:54
  a favorable price for everyone, how does that affect like Novant and UNC,
• 5:59
  who have already signed contracts to be preferred?
• 6:03
  You know, would you want to, you know, they kind of did that with the understanding
• 6:06
  that they would be the preferred provider.
• 6:09
  Yeah, I don't know. Atrium just steps in and, you know, at least access. And they're so big.
• 6:14
  I don't know. It just seems at this point, it's probably too late to do something like that.
• 6:20
  And this goes on. Don't forget, y'all, if you haven't called the Wake County
• 6:24
  Commissioners, they've not had their vote yet on the merger of Atrium and Wake
• 6:29
  Med. And, you know, the health plan was very clear at the time.
• 6:34
  That merger would cost every single person in the health plan over $100 more
• 6:40
  a year out of your pocket.
• 6:42
  It doesn't matter where you live. You can live far away from Atrium or Wake Med.
• 6:47
  It would make every member of the state health plan have to pay more than $100
• 6:51
  more a year if they were to merge.
• 6:54
  And Sammy, you said you saw some signs around where you live, right? Yeah.
• 6:58
  Seeing more and more people upset. Yeah, they just keep popping up around Glimwood Avenue. What signs?
• 7:03
  The signs that are saying no atrium takeover and WakeMed, our community hospital.
• 7:11
  Yeah. Those seem to be popping up more and more along Glenwood Avenue and those
• 7:15
  main streets where people are driving every morning, very heavy traffic,
• 7:20
  every morning and afternoon.
• 7:22
  Yeah, there is a grassroots effort that's pretty strong out there. Yeah.
• 7:26
  So no news from the state health plan, but another topic that state treasurer
• 7:31
  Brad Briner is heavily involved in is obviously the pension system and the teachers
• 7:37
  and state employees retirement system.
• 7:39
  Board of trustees met on Friday of last week.
• 7:43
  We did not get to talk about it because we published on Friday,
• 7:45
  but we do need to revisit that and see and just talk about kind of what came out of it.
• 7:51
  I guess the top line is the system earned $17 billion in the last fiscal year ending on June 30th.
• 7:59
  And that's a return of 12.4%. So that's good news.
• 8:06
  That's great news, yeah. I think our five-year average is what,
• 8:10
  I know when Treasurer Bronner was here, or when we were at his office talking to him, he mentioned,
• 8:15
  they have to look at everything in the retirement system in terms of five-year,
• 8:20
  what they call smoothing.
• 8:22
  And that's still biting us because the five-year results are not fair.
• 8:28
  You had mentioned that you don't like It's the smoothing. I hate the smoothing.
• 8:33
  Chief Investment Officer Kevin Segrist said the main message out of this is
• 8:39
  we're closing the gap, which is one of our objectives over time,
• 8:43
  and materially and expeditiously improve the returns of the retirement system.
• 8:48
  I think the unstated goal there is to hopefully get a COLA for our members in
• 8:53
  the future, and they've actually said as much.
• 8:56
  But, you know, you see $17 billion in returns in a year, and retirees can't
• 9:02
  help but wonder, well, why do we not get a COLA from that? Right.
• 9:06
  I mean— And I think that's a valid question. It's a smoothing. Yeah.
• 9:11
  Well, we did poorly, you know, three years ago. And to me, it's—I get it,
• 9:16
  the accounting technique that smoothing is.
• 9:20
  But there's never, what happens is that makes it to where there's never a good time for retirees.
• 9:26
  Oh, yeah, it's not a good time because we had a bad year three, four years ago.
• 9:29
  And then. You're always going to have a bad year. Right. Because.
• 9:32
  One of those four years. Exactly. And, you know, Treasurer Brunner even acknowledged
• 9:37
  that. Yeah, it's very rare that you have five amazing market years in a row, right? Yeah.
• 9:42
  So I do have concern that that's part of the problem.
• 9:47
  And then the other issue is just going to be the fact that as more positions
• 9:53
  have been cut in state government, that's even less positions putting money into the system,
• 9:58
  which puts more pressure on the General Assembly to do a larger employer contribution.
• 10:04
  Are they going to take up the slack of the positions they cut,
• 10:07
  which in part defeats the purpose of losing those public services that were
• 10:12
  needed in the first place? Yeah.
• 10:15
  Or are they not going to increase their funding on the employer side,
• 10:20
  meaning you would still go behind and need an even greater return on the investments?
• 10:26
  And if you just hire the workers, you get the economic impact of that.
• 10:29
  Exactly. You know, of new people having jobs. Oh, it's a no-brainer.
• 10:33
  Yeah. So you'd rather invest in employees than throw all your money at the retirement
• 10:38
  system, which you'll have to do, right?
• 10:41
  And speaking of having to do that, this Carolina Journal story states that after
• 10:46
  a meeting, they spoke with Reiner about the pension system,
• 10:50
  and they brought up this report from the Committee for a Responsible Federal
• 10:54
  Budget that says that Social Security will be experiencing a 22% shortfall in
• 11:00
  the next six years unless Congress acts.
• 11:04
  And so, Reiner answered that, you know, there's no math where we can make retirees whole.
• 11:11
  Because of that, you know, we can't pick up the slack of that big of a.
• 11:15
  Yeah, should that happen? Yeah.
• 11:17
  Now, you said that you that North Carolina is unique in that.
• 11:21
  Well, not unique, but one of the few states where retirees also get Social Security benefits.
• 11:27
  Yeah, I don't know if we're one of the few, but we are one of the states.
• 11:30
  Some states have a higher benefit, a higher check that goes to their state retirees
• 11:35
  than North Carolina based on a formula that's much, much higher than our formula.
• 11:41
  But in those states, some of those states don't allow Social Security to go to those employees.
• 11:49
  So our system allows Social Security. So would that mean that,
• 11:53
  you know, the formula would have to increase to pick up that slack? Right, wouldn't you?
• 11:58
  Yeah, like, okay, so take, when we say formula, when you retire,
• 12:02
  the average pay of your last four years wages is taken.
• 12:07
  And it's multiplied and there's a formula that's applied to it.
• 12:11
  In North Carolina, that formula is 1.82%.
• 12:16
  The average among the states is 2.00.
• 12:21
  To put that in perspective, each of those clicks from 182, 345 on up to 2.0
• 12:28
  is worth about four-tenths of 1% of a cost of living adjustment.
• 12:35
  So if you look at it that way, our retirees start out making 9% less based on
• 12:42
  the calculation of their retirement check than about half of the states.
• 12:47
  Now, some of those states, though, don't have Social Security going to their retirees. We do.
• 12:53
  So Social Security is, as I think the point the treasurer was trying to make
• 12:57
  is, Social Security is a very, very vital part of the retirement.
• 13:04
  Of a retired worker that worked for the state of North Carolina because,
• 13:08
  you know, we're counting on them having that. If we didn't, as he said,
• 13:12
  we would never be able to make it whole. We could never backfill that much money.
• 13:16
  So the second part of that quote from Briner is, but that's never going to happen,
• 13:21
  because lawmakers are never going to allow Social Security to lose,
• 13:26
  to have a shortfall like that. They'll just put more money into it, which is also a problem.
• 13:31
  But what do you think? I mean, at some point, do we have to reform Social Security or?
• 13:38
  I mean, they've already done a few little things. Wasn't all that long ago that
• 13:42
  your full Social Security age was 65. Obviously, it's been 67 for a while now.
• 13:47
  And the talk on Capitol Hill has been,
• 13:51
  Even from the director of Social Security, and he had to pull it back,
• 13:56
  his statement, but there's been talk of moving it to 69, 70.
• 14:00
  Some people even want it over 70 to get full Social Security.
• 14:04
  And that obviously would buy you a lot more time.
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  The other thing would be to cut the benefits.
• 14:11
  Literally cut those Social Security benefits by a fairly substantial amount.
• 14:15
  It would be the 22, 23 percent amount.
• 14:19
  That's one option. The other thing is to increase that amount at which we stopped
• 14:24
  taking Social Security out. I think it got moved this year to $183,000, somewhere in there.
• 14:31
  If you make more than that, once you make more than $183,000,
• 14:35
  we stopped taking Social Security out.
• 14:38
  Yeah. And so, what if you took Social Security out for somebody making $4 million?
• 14:44
  Obviously, there'd be a lot more money in the system. That's true.
• 14:48
  Yeah, that's a very good point. That was going to be my other point was the
• 14:52
  other option is to raise taxes to people who can afford to pay tax.
• 14:58
  You don't even have to. I mean, just everybody put into Social Security for
• 15:02
  their whole check. I mean, that's definitely one of the things. And so, they moved it.
• 15:06
  I don't know. I think about, they moved it up about $8,000.
• 15:10
  But people, a lot of people are asking, why would we cap it at all?
• 15:14
  Yeah, why do you cap that? I mean, the people who make that much money can't afford to pay.
• 15:19
  Yeah, well, one would think, right? And with an aging population,
• 15:23
  this is a tangent, but, you know, I just see so many, you know,
• 15:27
  the baby boomers are aging so, there's going to be so many of them in the next
• 15:32
  five or ten years, you know.
• 15:34
  So I think I read that more than half the country will be above a certain.
• 15:40
  Yeah, I mean, right now, 20% of the population of North Carolina is on Social Security.
• 15:48
  So that's a lot. That's a huge economic driver and hindrance if it's not going
• 15:54
  well. Well, the whole system was set up so that you, kind of like our retirement
• 15:59
  system for state employees, you fill it as you go.
• 16:02
  And so you have some people drawing the check who spent their career putting
• 16:05
  in, and then you have other people who are putting in with the implicit promise
• 16:10
  that one day they'll be able to draw.
• 16:13
  And what we've got right now is a dwindling number of people who are putting
• 16:19
  in because of the demographics. We just don't have as many young people as we
• 16:23
  have older generations.
• 16:25
  So there's really no question that at some point, and I think Treasurer Briner's
• 16:30
  right when he said, this is going to end up falling on the younger generations
• 16:33
  one way or the other. Now, does it have to? No.
• 16:36
  No, there's so many things you could do. You know, when we're having discussions
• 16:40
  over whether to spend another $300 billion on a war, I think it's pretty obvious
• 16:46
  there's other things we can do.
• 16:48
  It depends what we decide to prioritize. That's all. It's all about that,
• 16:52
  even at the state level. Well, in 1983, Social Security was almost broke.
• 16:58
  That's what everybody was told, right and left.
• 17:00
  It's going broke. It'll be broke soon, very soon.
• 17:03
  And what Treasurer Briner was saying about politicians won't have the wherewithal
• 17:07
  to actually make devastating cuts to it.
• 17:11
  That was true then. I don't know if I feel as confident now.
• 17:14
  There's so many politicians who've been very kind of brazen about saying people
• 17:21
  should work longer and they shouldn't expect as much from their Social Security.
• 17:25
  And I'm thinking, oh, my goodness, if you've put into it at that point 50 years.
• 17:31
  I guess you do expect. It's not that Social Security makes you rich either.
• 17:35
  It's a pretty nominal check.
• 17:37
  I mean, it's like I shared with you. My dad is almost 80, and he still has to
• 17:43
  work. I mean, and he gets a Social Security check, and he really lives off that.
• 17:47
  You know, that's very important to him, and it's just a real mess.
• 17:51
  But it's a massive issue. It's a massive issue in terms of payroll tax.
• 17:55
  It affects the state. What the federal government decides to do with Social
• 17:58
  Security does affect the state on a number of levels.
• 18:02
  And so I'm glad the treasurer's keyed into that and paying attention to that
• 18:06
  because he really would have a mess on his hands that he could never fix if they changed that.
• 18:12
  Well, other statewide news. I saw this story about the Department of Health
• 18:17
  and Human Services are tracking cases of cyclosporiasis.
• 18:23
  Cyclosporiasis. There you go. I am impressed that you can say that.
• 18:26
  They've got a lot of health anxiety. I learned these things.
• 18:30
  Me too. It makes it useful. Yeah. So there's two,
• 18:33
  cases reported. Well, this is a Watauga Democrat story. So that's the name of
• 18:37
  the newspaper, not just some dude. It's a Democrat in Watauga County.
• 18:41
  The Watauga Democrat. Yeah. So this story from them says there's two cases reported in Watauga County.
• 18:47
  There's been cases, I guess, pretty much all over the state.
• 18:51
  And the DHHS has created a dashboard that tracks all of them.
• 18:56
  There have been 728 cases in North Carolina this year alone.
• 19:00
  And it's updated on Tuesdays. And you can go to this URL and see it. But another dashboard.
• 19:07
  I honestly think that ever since COVID, people take any parasite sickness and
• 19:13
  kind of blow it out of proportion. Because cases and sicknesses like this,
• 19:17
  this is a parasite that has existed in the past.
• 19:20
  Things like this happen every single summer because you are growing more fresh
• 19:25
  produce and people are consuming more fresh produce during the summer.
• 19:28
  Yeah. And I think just since COVID, people blow more and more of these things
• 19:33
  out of proportion because before they didn't talk about it nearly as much.
• 19:37
  It was like, yeah, there's a stomach bug going around.
• 19:42
  I do think, though, we're a little more nervous because we know there's less.
• 19:46
  Oversight. Yes, because some of the cuts at the federal level were to people,
• 19:51
  looking into our food safety.
• 19:53
  And I think that's made some of us really talk about getting paranoid.
• 19:57
  And I'm sorry, girl. They said explosive diarrhea. Like, that's all I had to
• 20:02
  hear. I am not having any lettuce. Nothing. But there is also people who are
• 20:06
  searching for it because they want to lose weight.
• 20:09
  Oh, my gosh. Yeah, I've seen that, too. Like, this is, I don't think that's
• 20:12
  how that works. That would not be a good way to lose weight.
• 20:15
  No. Ridiculous. Just take lots of, I don't know, something that makes you do that.
• 20:21
  Yeah. It's the word explosive. I can't get past. Yeah.
• 20:26
  Oh, yeah, that just sounds. They say it lasts for like three weeks. Holy cow. Yeah.
• 20:31
  It also another thing with this is some people don't get symptoms or anything
• 20:35
  until about a week or two later. So you could go through it and be like,
• 20:38
  I have no idea what I ate two weeks ago that could cause this. Yeah.
• 20:43
  It seems like people want to blame Taco Bell, too. People always want to blame
• 20:47
  Taco Bell. I think it's because there was something about there were Taco Bell's
• 20:51
  certain locations that were pulling all their lettuce and cilantro. row.
• 20:55
  Yeah. Almost like a, oh, it could have been our stuff. Yeah. Oops.
• 21:00
  I saw a tweet that was like, how do you know if it's explosive diarrhea from
• 21:05
  this or just regular diarrhea? Or if it's just normal Taco Bell.
• 21:09
  I had Taco Bell food poisoning one time. Oh. I'll say it would be hard to know the difference. Yeah.
• 21:15
  But I don't know. I think tracking it does sound kind of Really almost impossible.
• 21:21
  Nobody remembers where they ate yesterday. But it's cool that HHS has got this
• 21:27
  dashboard. I think that's helpful. And for folks who have health care anxiety,
• 21:31
  that's maybe helpful. Maybe not, though. Yeah.
• 21:35
  For some of us, it just makes us avoid a lot more foods. Because,
• 21:39
  like, in past cases, it's been linked to berries. It's been linked to lettuce.
• 21:44
  It's been linked to fresh herbs. Y'all know where it comes from, right?
• 21:50
  Well, not having adequate toilet facilities. It only comes from human things,
• 21:54
  right? So this was a huge issue, again, in the 80s. It seems like the 80s are
• 21:59
  coming around in every way again.
• 22:01
  And I remember it. My aunt called it the peat on lettuce because they were telling
• 22:06
  everybody in Texas in the 80s to stay away from the lettuce.
• 22:09
  And what happened was...
• 22:11
  The farmers weren't providing appropriate toileting facilities for field workers,
• 22:16
  and they had nowhere else they could go.
• 22:19
  So they're going to the field. And I did see that Taylor Farms,
• 22:23
  which has been named and come out and said that that's not true,
• 22:26
  and it's been a whole thing.
• 22:28
  They get a lot of their lettuce from Mexico. And that just opens up a whole
• 22:33
  other issue with the whole immigration and the lack of farm workers here. And I don't know. Yeah.
• 22:39
  And I mean, I know the Department of Labor in North Carolina does have people
• 22:44
  who inspect farms and make sure that there are appropriate facilities because
• 22:49
  it honestly, it does become a public health issue.
• 22:52
  Seems like there'd be something you could spray on the lettuce to kill it all. I don't know.
• 22:57
  But maybe that would be do more harm than good, right? But there's also the
• 23:00
  issue that, you know, your workers should be entitled to have a facility.
• 23:04
  Well, it is also some of the products that they label organic,
• 23:08
  they can't spray those kinds of things and pesticides on them.
• 23:11
  Otherwise, it's no longer organic and they can't charge you an arm and a leg,
• 23:15
  for said organic products.
• 23:17
  And you said that two people have died from it here, right? Yes,
• 23:20
  not here. I believe it was in Michigan or Minnesota or something.
• 23:24
  Yeah, it was Michigan. One of those M states. I think it was Michigan.
• 23:27
  But, I mean, if it can last as long as you say, I can see that this is a gross
• 23:32
  conversation for a podcast. No, but like dehydration. I would think,
• 23:35
  yeah, you could, if you were ill or just too skinny.
• 23:38
  I'll tell you what, I've been severely dehydrated before, just in general.
• 23:43
  It is not a comfortable feeling. Yeah. It's very scary.
• 23:48
  Well, very scary. Yeah. The only other story that I saw anywhere,
• 23:53
  the only other story noticed was Wake County Schools.
• 23:57
  There's a story in the News and Observer that Wake County Schools is facing
• 24:01
  a $17.6 million in budget cuts this year.
• 24:05
  And part of the reason I think had to do with the state budget and raises maybe
• 24:10
  being higher than they expected.
• 24:12
  Is that what you saw, Samantha? Yeah, what I'm seeing is that they built their
• 24:17
  budget around the projection that they would provide a 3% raise, and now
• 24:22
  there's 3% raise for non-certified staff, but there is an average of an 8% raise
• 24:27
  for the teachers, with the biggest raises going towards beginning teachers,
• 24:32
  making the new state-based salary range from $48,000 to $59,000.
• 24:39
  Yeah, and so the county picks up part or whole of that raise for some teachers,
• 24:44
  right? So they would be on the hook for that.
• 24:48
  I know that Wake County has a much larger supplement than surrounding counties.
• 24:52
  I know when I worked for the newspaper in Sanford, that was a big problem that
• 24:56
  we lose all of our teachers every year to Wake County.
• 24:59
  Yeah, it has traditionally been a very generous supplement. So maybe that may
• 25:05
  not be as much the case moving forward. I don't know. I didn't see any mention
• 25:10
  of that in the story, but...
• 25:12
  And I think that that's what we're going to see more and more stories about,
• 25:15
  those type of things, because...
• 25:17
  I've talked to a lot of folks from cities and counties who said,
• 25:20
  whew, there's stuff because of the budget that is putting pressure on them.
• 25:25
  There's also ways in which the state budget alleviated little pockets of pressure.
• 25:29
  I know that we have some state employees who are still complaining that part
• 25:33
  of the budget was to allocate money towards paying for law enforcement increases for local government.
• 25:41
  Which seemed so strange to them. Yeah. But I think we're going to see a tremendous
• 25:47
  number of stories as people work through the budget.
• 25:50
  Certainly if the General Assembly, either between now and the end of the year
• 25:55
  or when they come back in January, if they do anything with property taxes for
• 26:00
  the local government's goodness, you're going to really see.
• 26:03
  A lot of different budgeting issues for them.
• 26:07
  So to wrap up that story, it says Wake County will need an additional $17.1
• 26:12
  million in local funds, $13.7 million for the teacher raises,
• 26:17
  and $3.4 million for the bonuses that are in the state budget.
• 26:21
  They'll also need another half a million for state health plan hospitalization contributions.
• 26:27
  So the budget, the state budget was obviously...
• 26:30
  Disruptive for local budgets as well. Yeah, I mean, it's a good thing to have
• 26:36
  the increases for the teachers, but yeah, it does put pressure on people.
• 26:42
  You said you had another story? Yeah. The other story I wanted to mention wasn't
• 26:45
  really a story. It was a television show on Spectrum that the DMV commissioner,
• 26:51
  Paul Tine, was a guest on In Focus. It's the name of the show, In Focus.
• 26:56
  And he was talking about, you'll love it, John. I mean, the show was just Sunday,
• 27:03
  so you probably hadn't had a chance to see it yet, but he talks about technology
• 27:07
  and how they're really investing heavily in upgrading their technology.
• 27:12
  He also talks about the workers they've gained. They've gained even more workers
• 27:16
  this year through the budget.
• 27:18
  As we talked about last year, after
• 27:21
  years and years of begging the General Assembly for more folks at DMV,
• 27:25
  They finally did that to a large degree, not to the degree DMVs always said
• 27:30
  they needed, but they got a big chunk of the way there.
• 27:33
  And then in this budget, I think there's 35 more that have been added.
• 27:39
  I see that episode is available on their website. I'll share it on our Facebook page.
• 27:43
  Okay, cool. That's pretty neat, yeah. And then he talks about how they've tried
• 27:46
  to open more offices in areas, like rural areas.
• 27:52
  Where people have been, they had been pulling people from some of these rural
• 27:55
  offices to try to help with offices where there had been tremendous traffic. So, yeah.
• 28:01
  To avoid having to do that, they've moved some staff into those offices.
• 28:05
  So it's an interesting interview.
• 28:07
  I wasn't sure about the part where
• 28:08
  he says we've moved people so that he mentioned Garland, for instance.
• 28:13
  They've opened one up in Garland. And I thought, well, that's good if somebody lives around there.
• 28:19
  But I kind of wondered, did somebody have to move from working in Charlotte to go work in Garland?
• 28:23
  You know, I don't know the answer to that. But yeah, I know that when we were
• 28:27
  trying to get my son's driver's license, he was like right during the COVID
• 28:31
  era and it was like impossible to find a place.
• 28:35
  I know that we would go anywhere to get it, you know, and I bet that's still
• 28:39
  the case. You would go you would drive an hour away if you could get an appointment.
• 28:44
  Yeah, that was the question the reporter asked him was, look,
• 28:47
  are people still driving?
• 28:49
  Yeah. And he said, you know, the goal is for them not to have to do that.
• 28:53
  And they're hopeful that some of these changes will fix it.
• 28:57
  When I was in college and I got my updated ID once I had turned 21,
• 29:02
  there was someone in there.
• 29:04
  Because I waited in a long line. Like, I was the last person let in that day,
• 29:09
  before they said, hey, everyone behind her gots to go.
• 29:13
  Go home. And I remember hearing someone in the line. I don't know if they were
• 29:18
  ahead of me or in front of me or behind me. I don't remember. Yeah.
• 29:21
  But I remember hearing someone say, I drove three hours from Charlotte because
• 29:25
  this was the only place that wasn't making me. Because at the time,
• 29:31
  it was 2021, so it was after dead of COVID time.
• 29:34
  And they weren't making you at that DMV. They weren't making you do appointments.
• 29:40
  So it was like the only place within the distance that that person,
• 29:43
  they had to drive from Charlotte to Silva, North Carolina.
• 29:47
  Well, it seems like, to me at least, that, you know, the DMV hasn't approved
• 29:51
  dramatically since then. Oh, yeah. It seems like.
• 29:54
  Yeah. I just went to the license plate agency earlier this year,
• 29:58
  last year, last year, and I got in and out in maybe 10 minutes.
• 30:03
  Yeah, we tend to fund them pretty
• 30:05
  well. But it was also 8 o'clock in the morning as soon as it was opened.
• 30:09
  Yeah. Well, and I think it brought to mind, though, that we've talked about it several times.
• 30:14
  And I know we invited him, but we need to invite him again, Commissioner Tine,
• 30:17
  to come and talk. I think that DMV issues never go away as issues of interest,
• 30:23
  even though things are a lot better.
• 30:25
  People always want to talk about or hear about DMV. And speaking of invites,
• 30:29
  and it kind of ties in with this, with DMV, but I'm still searching for someone
• 30:34
  to talk to me about AI and how it will affect state employees and state jobs.
• 30:39
  I've reached out to several different agencies, haven't had any luck yet,
• 30:42
  but I'm still working on it. So hopefully if you hear this and you know anything
• 30:46
  about it, give me a call. Let's do a podcast.
• 30:49
  Tell you what, my opinions on AI get stronger and stronger every day.
• 30:53
  Because I'm at the point where I'm like, why am I seeing so many commercials
• 30:56
  promoting AI? If you are having to force feed me propaganda to make me believe
• 31:01
  that it's a good thing to put these data centers near my house, it's not good.
• 31:05
  I think because it's mainly the data center commercials that I'm seeing.
• 31:09
  It's not the actual AI brand. Just have faith. At the end of all of this,
• 31:13
  none of us apparently have to work.
• 31:15
  The government will just give us money. That's what I keep hearing. Yeah.
• 31:20
  Did you see the Elon interview? Yeah, where he's like, yeah,
• 31:23
  no one will have to work. And the lady was like, well, how are you going to
• 31:26
  pay for that? Are you going to raise your taxes because you'll have all the money?
• 31:30
  And he's like, oh, no, no, we don't want to do that. Yeah, I was like.
• 31:33
  Wait, what? But he's inferring that we get money. So where it would come from
• 31:38
  other than the government, I don't know. But anyway, it's going to be great,
• 31:40
  Sammy. And he said. We're just going to be like Wally. We're going to just exist.
• 31:46
  He said that. That sounds awful. Anyway, so Gen Z moment.
• 31:51
  We talked a little bit about what's going on at the legislature this week,
• 31:54
  and a big part of that is the debate over THC products.
• 31:59
  I think there's a bill to pretty much do away with all of them, right?
• 32:03
  It caps the amount that they can include in it, which does kind of restrict.
• 32:08
  And it does for a lot of companies and brands.
• 32:11
  It basically puts them out of business overnight because while hemp farming
• 32:17
  is legal at the national level, it restricts how much they can include in their products and products.
• 32:25
  Messes with their formulas so they can no longer essentially produce some of
• 32:29
  the products that they were producing.
• 32:31
  And not to just be stereotypical and put this in Gen Z moment,
• 32:36
  but you had some statistics on that, right? Yeah.
• 32:40
  Gen Zs have definitely changed their habits when it comes to drinking versus THC consumption.
• 32:50
  And Gen Zs' statistics show that 69% of adults between the ages of 18 to 24,
• 32:57
  favor THC over booze, and 56% have actively replaced alcohol with cannabis.
• 33:05
  So some of the reasons behind it is the health and wellness,
• 33:09
  and it's perceived as a cleaner, more predictable way to unwind without physical
• 33:14
  illness or heavy hangovers.
• 33:16
  Social media mindset, Gen Z is more conscious about their public image,
• 33:20
  and they do not want to post or record messy videos of them drinking and being seen in public as messy,
• 33:29
  intoxicated, embarrassing kind of.
• 33:32
  As well as social and financial factors.
• 33:35
  It's cheaper for them to consume an edible or a THC-infused,
• 33:40
  beverage or share a vape that includes THC limits in it, rather than going bar
• 33:46
  hopping and clubbing and paying for drinks and going about that.
• 33:50
  To be clear, though, marijuana is still largely illegal in North Carolina,
• 33:55
  except for on the Cherokee Reservation.
• 33:58
  Yes. And hemp-derived products, not marijuana-derived products.
• 34:03
  So, like, hemp products like Delta H and other THC products. Yes.
• 34:08
  It is THCA and Delta 9, Delta 8 products is what the Gen Zs are using.
• 34:16
  Okay. Is that what they call weed?
• 34:18
  No, this is the legal, what they are allowed to farm and legally produce.
• 34:24
  Okay, so you wouldn't. Okay.
• 34:26
  There is no legal repercussions of consuming THCA, Delta 9, Delta 8 products.
• 34:33
  So this is a huge economic fight. It really is.
• 34:37
  Really, it's a total economic. Every gas station you go in has a bunch of that stuff.
• 34:42
  And, you know, there's all these vape shops and things.
• 34:45
  And I'm not even saying it's a bad thing, like, you know, but it is an economic driver.
• 34:51
  I mean, there is an element of that. And based on a national survey on drug
• 34:57
  use and health, last year it was recorded that there are 21.4 million daily or near,
• 35:03
  daily THC users in the U.S.
• 35:06
  While in comparison, there is only 17.2 million who consume alcohol on a daily basis.
• 35:13
  And that's just Americans. That's not a matter of Gen Z's. That's just in general.
• 35:19
  Again, this is boiling down to a fight. Clash of the Titans,
• 35:25
  the liquor industry, alcohol industry.
• 35:28
  Yeah, they're like, why are you dragging us into this?
• 35:31
  Yeah, I bet they love being drug into this.
• 35:35
  And it's even gotten to the point where there are a lot of, especially in North
• 35:38
  Carolina, local bars and restaurants who have started incorporating THC ciders and seltzers
• 35:45
  into their menus because Gen Z's and some of the younger generations are choosing,
• 35:51
  to drink that over alcohol.
• 35:53
  And so their sales were declining with alcohol. So they found a way to bring people back in.
• 35:58
  That's fascinating. Yeah, hundreds of protesters have packed the legislature.
• 36:03
  Sure. Yeah, we're recording this on Tuesday, by the way, and so that's going on right now.
• 36:07
  So this is kind of becoming the shrimper issue of 2026.
• 36:13
  I hope they're as strong as the shrimpers. I mean, it's fascinating,
• 36:17
  the things that will bring everybody out.
• 36:19
  Yeah. And this seems to be the biggest I've seen since the shrimpers.
• 36:23
  So this bill passed the Senate last month, and then House Speaker Destin Hall
• 36:28
  declined to bring it up until now.
• 36:31
  So we'll be watching. Is there a state employment angle to this?
• 36:36
  Like, can it bring in revenue? Well, I mean, all of it can be taxed.
• 36:41
  But it is a good question, like how you tax it.
• 36:44
  That's been a knockdown drag out. I remember we were dealing with a Tabor law
• 36:49
  a few years back, and that was kind of one of our examples that,
• 36:53
  you know, Colorado had so much trouble with the Tabor law that they had to—,
• 36:58
  Start selling marijuana. No, the issue was Colorado, you had legal marijuana
• 37:05
  in Colorado you could buy.
• 37:07
  And they had a Tabor law, which put a maximum on the revenue.
• 37:12
  They put a cap on their revenue.
• 37:14
  And so when it was over 5% over a certain number, anything above that,
• 37:20
  a check went back to the public.
• 37:21
  Well, a lot of the proceeds were coming in from the tax on sale of marijuana.
• 37:26
  So little old ladies were getting checks because they were drug dealers, basically.
• 37:31
  That's how they saw it in many cases. Because the state was a drug dealer.
• 37:35
  Yeah. And so there were literally some people saying, I don't want this check,
• 37:40
  because it's drug money.
• 37:42
  It was a whole thing. I think I just found our solution to the retiree COLA problem. Sell drugs.
• 37:49
  Open up marijuana sales. You can't make a fraction off of that compared to what
• 37:54
  you make off of pharmaceuticals.
• 37:55
  Or hospitals, right? You know, it's all a big circle. It all comes out.
• 38:00
  Yeah, okay. Or hospitals.
• 38:01
  I saw somebody today, Duke Energy's quarterly,
• 38:07
  earnings report came out, and it was like a billion that their profits are up
• 38:12
  11%, and they made a billion in profits in quarter two of 2026.
• 38:18
  And so people are like really mad because the power company made a billion dollars
• 38:22
  in profit in quarter two. But that's where it's fascinating to me that your
• 38:26
  nonprofit hospital can have $10 billion sitting to the side. You're cool with that.
• 38:31
  But your power company making money.
• 38:34
  It's interesting where people draw the line. Same with alcohol and hemp.
• 38:40
  I think it's because we use energy on a daily basis. Like, a lot of people do
• 38:44
  use their health care on a very regular basis. But energy is an every single
• 38:48
  day kind of thing. And we see those bills every single month going up.
• 38:53
  It's outrageous. There's no question.
• 38:55
  But should nonprofit hospitals make the kind of profits? They should not make a profit.
• 39:02
  They should not make a profit. I had that conversation with my dad and one of
• 39:06
  his work buddies and mentioned to him how much the atrium CEO makes on the phone.
• 39:11
  And he was like, that's stupid.
• 39:14
  I was like, I'm aware, dad, I know.
• 39:17
  And his work buddy, his work buddy will be sitting in the car with him and he'll
• 39:21
  get so interested in some of the things that I bring up that he starts asking
• 39:25
  me all these questions. And I'm like, exactly. You're having these conversations
• 39:28
  with the military. Yeah.
• 39:30
  So it's time for my question of the week.
• 39:40
  Question of the week. I am going to the happiest place on earth this weekend, apparently.
• 39:47
  I'm not very happy about spending the money to get there or, but you know, whatever.
• 39:52
  It's like, it's like I always said, I heard a joke one time that,
• 39:56
  when the family goes up to the, you know, they get through the gates at Disney
• 40:00
  World, like Mickey comes up behind the dad and points a gun at him and says,
• 40:04
  give me all your money. And that's basically what happens.
• 40:08
  So my question is, who's your favorite Disney character? And the only right answer is Donald Duck.
• 40:13
  So, who is your favorite? I never got into it as a kid. Oh, okay.
• 40:18
  Do you have a favorite cartoon character then?
• 40:21
  I know Sammy. Yeah, Sammy. I got two. Okay. I got two. Belle, Beauty and the Beast.
• 40:27
  Well, yeah, Todd Trax. Rear, love it.
• 40:31
  And Rapunzel from Tangled, particularly. I can't believe you didn't say Stitch
• 40:35
  from Lilo and Stitch. I love Stitch.
• 40:38
  I love him. He's my favorite animated character. But, like, my favorite Disney
• 40:42
  characters overall are those two Disney princesses.
• 40:45
  Rapunzel mainly because she's just great. They're all animated.
• 40:49
  Animated in the sense of not human. Yeah, not human. That's a generational thing.
• 40:56
  Yeah. What about you, Artis? Give us something. I just love Snoopy.
• 41:00
  But he's not Disney at all. No, he's not. How did he survive? Like, how did he?
• 41:04
  He's the best. He's so cool. How did he make it over the powerful Disney overlords?
• 41:10
  You know, how did he survive? Who's your, so yours is Donald?
• 41:13
  Donald, definitely Donald. Donald's the only one of the main five or six with
• 41:16
  like a real personality. Like he's angry. He's mean. He's like, he's got real emotions.
• 41:23
  Mickey's just always like, you
• 41:25
  know? Yeah, when my kids would watch that stuff, the noise is just nuts.
• 41:29
  I think it's funny how people love to make fun of the fact that after all this
• 41:33
  time of Donald and Daisy together, He still hasn't proposed. Yeah.
• 41:38
  Are Mickey and Minnie married? Yeah. I don't think they got married.
• 41:41
  I think that would be. Oh. Did they? Did they?
• 41:44
  We need to know. Did Kermit and Miss Piggy get married? That was a somewhat
• 41:48
  abusive relationship. That's a whole other issue.
• 41:52
  You know, the Muppets are now Disney, too, right? Yeah, they're married.
• 41:54
  Let's talk about something while we're on it.
• 41:58
  Mickey and Minnie, they decided in 19...
• 42:00
  Mickey and Minnie really did get married? They decided in 1933,
• 42:04
  an interview, Walt Disney explained that he and the studio decided that they
• 42:10
  were married behind the scenes. Okay. So they're married.
• 42:13
  Wow. Donald's just too he's a loner he don't need to be married but he's in
• 42:18
  a relationship with Daisy he's in a long term relationship she's the only other talking duck I know.
• 42:26
  Love is love. What were you going to say, Arniss? I was more of a Looney Tunes
• 42:30
  kid when it came to the animated stuff, so I was more of like a Daffy Duck kind of kid and Bugs Bunny.
• 42:38
  I was going to say the messaging sometimes can be.
• 42:41
  Disney, the first Disney movie I ever saw was Bambi, and I think we can all
• 42:45
  agree that was traumatic.
• 42:47
  I mean, if we want to talk about the trauma that they, one of my favorite characters,
• 42:52
  Belle, Stockholm Syndrome. Yeah.
• 42:55
  I mean, that's a lot of regrettable things in its past, for sure.
• 42:59
  And then, I know this wasn't Disney, but Rudolph the Red-Nosed Reindeer,
• 43:05
  there's a lot of poor, poor reindeer. Are you talking about the cartoon where
• 43:09
  the kid who wanted to be a dentist? Yeah. Yeah.
• 43:12
  And remember, Rudolph, the coach, was like awful to them.
• 43:18
  He would have been fired from any school.
• 43:23
  There's so much In Rudolph It's fascinating And Frosty That's a whole other issue But Yeah
• 43:29
  I digress Okay Well There's so many childhood shows That are just traumatizing
• 43:33
  When you look back at them I'll look for We'll do a whole episode I'll look
• 43:36
  for some sort of Disney puffin,
• 43:39
  Maybe there's something Maybe they could redeem themselves If they had a puffin,
• 43:43
  All right That's our show this week Thank you for joining us.