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June 23, 2000 n Issue No. 7 n The 2000 Short Session
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Appeals Court Says 'Total Disability' Means Just That
The N.C. Court of Appeals, in a decision that will be welcomed by large employers trying to contain their workers' comp premiums, has ruled that “total disability” means exactly what it says: For an injured worker to collect total disability payments he or she must be unable to return to work at any job -- his old job or some other lower-paying job.

The decision comes in the case of a worker at the Converse shoe factory in Lumberton, Michael Demery, who strained his back lifting a 50-pound basket of shoe molds in 1994. Demery was diagnosed with lumbar strain, received medical attention and told to return to work on light duty. He continued to feel back pain at work and on Jan. 2, 1995, he told his foreman that he could no longer stand his back pain. He then left work never to return.

Demery had surgery twice for a herniated disk, and his doctors said he was left with a 20 percent permanent partial disability. His doctor placed Demery on permanent work restrictions of frequent change of position, limited bending and stooping, and lifting of weights no greater than 25 pounds.

The N.C. Industrial Commission ruled that Demery was permanently totally disabled because he was unable to return to his old job or a similar paying job. The commission also awarded Demery lifetime medical expenses. Converse appealed, and the Court of Appeals, in a decision handed down on June 12, reversed the Industrial Commission in part and remanded the case.

“In the present case, the (Industrial Commission) found that plaintiff had met the burden of showing total disability because he was incapable of earning the same wages as before the injury in the same or other employment, and his incapacity to earn wages was caused by a compensable injury,” Judge Howard Hunter wrote for the court. “We disagree with the commission's interpretation of total disability.

“For the Industrial Commission to find that an employee is permanently and totally disabled, the employee must meet the burden of showing that he is totally incapable of earning wages.”

Judges James A. Wynn Jr. and John C. Martin concurred in the opinion in case No. COA99-592.

“Our review of the record does not indicate that competent evidence supports the conclusion that plaintiff is totally disabled . . . . Plaintiff has not met the burden of showing, with competent evidence, that he is totally disabled and therefore unable to earn any of the wages he was receiving at the time of his injury in the same or any other employment. Plaintiff has the burden of showing he is disabled,either partially or totally, before the Industrial Commission may award him permanent disability.”

Lawyers familiar with the case said the Appeals Court is raising an important distinction between medical disability and vocational disability. Some injured employees are unable to return to their old job or any other form of work. They are medically disabled and are entitled to total permanent disability.

Other employees injured on the job become vocationally disabled -- meaning they are unable to return to their old job or one very similar. But because it's entirely possible they could take some other kind of job, they are not automatically entitled to total disability, the Court of Appeals indicated.

Other Opinions
It's a violation of the state constitution's requirement for just compensation for the state Department of Transportation to condemn part of a tract of land for a road project and not pay for it, the state Court of Appeals ruled. The 2-1 decision written by Judge James Wynn, in which Judge Robert C. (Bob) Hunter concurred and Judge Clarence Horton dissented, involved 11.4 acres of land in Hickory taken by the DOT. The land was part of an 18-acre parcel owned by two couples. The DOT refused to pay for the 11.4 acres it condemned because it said the new road make the remaining part of the tract much more valuable than before. A jury upheld the department's decision. State law requires DOT to pay fair market value for property when it condemns an entire tract. But in cases where a portion is taken, it allows officials to weigh the benefits to the remaining property against the actual loss. "In effect, the property owner is subjected to an involuntary taking of his property while also being subjected to the injustice of receiving an amount less than what he has actually lost," Judge Wynn wrote in the majority opinion. Judge Horton said issues of just compensation weren't properly before the court and the equal protection arguments had no merit. The case is No. COA 97-1470.

Legislative News Briefs

Conferees Working to Assemble Final Budget Document
House and Senate conferees hope to quickly resolve differences in budget bills that have passed each chamber, setting the stage for a possible adjournment of this year's legislative session within a week or so. The only major item in disagreement is whether to give most state empl (except classroom teachers) a 5 percent pay raise, as the House wants) or a 3 percent raise, as the Senate prefers. The Senate is reluctant to go along with the bigger pay raise out of a fear that that state employees health plan is facing a huge deficit next year. Both budgets envision state spending of just over $14 billion for the year that begins July 1.

The few other substantial differences in the House and Senate budgets don't appear to be dealbreakers. The House and Senate budgets both propose a $30 million contribution to the Clean Water Management Trust Fund, but the Senate includes a provision that would increase state funding for the program to $100 million a year by 2003, with the money coming from the General Fund at the start of a fiscal year instead of from unspent money at the end of the year.

Also, the Senate dropped a House proposal to increase the N.C. Court of Appeals from 12 to 15 judges. A House plan to cut $2.7 million for UNC Hospitals was removed by the Senate, which also added $1.2 million for N.C. A&T State University to match federal funds. The Senate budget includes $2 million for the Department of Commerce's Industrial Competitiveness Fund, the same amount Hunt proposed. The House budget includes just $1 million for the fund.

Chairing the Senate conferees are Sens. Aaron Plyler (D-Union), Beverly Perdue (D-Craven) and Fountain Odom (D-Mecklenburg). Chairing the House conferees are Reps. Ruth Easterling (D-Mecklenburg) and David Redwine (D-Brunswick).

Railroad Bill Advances
After a $61 million buyout by the state of private shareholders, the North Carolina Railroad is now a publicly-owned entity, but the General Assembly is moving to allow the railroad to operate more like a private enterprise. Legislation that passed the Senate last week and is now before the House empowers the N.C. Railroad board of directors to run the business, not the state Department of Transportation or the Board of Transportation. That bill, S. 1183 NCRR Amendments, sponsored by Sen. Walter Dalton (D-Rutherford), passed the Senate 42-0. A companion House bill, H. 1515, is being sponsored by Rep. Walter Church (D-Burke). Both make the NCRR board accountable only to the General Assembly. At stake is who gets to make decisions regarding the 200-foot-wide, 317-mile-long strip rail corridor that runs from Morehead City through Raleigh and Greensboro to Charlotte. The legislation grants quick-take condemnation power to the NCRR board and the right to deal quickly with encroachments. It also gives the railroad dividends from its new lease with Norfolk Southern. Deputy Transportation Secretary David King thinks it is a good bill because it will allow the state to move more quickly to implement fast-rail service.

Bill Imposes New Restrictions on Lobbyists
The House Rules Committee on Wednesday favorably reported a Senate-passed bill that would require lobbyists to keep lists of every bill they lobby legislators and filed detailed reports after the legislature adjourns each year. The bill also would require lobbyists to report lobbying activity that occurs between legislative sessions. on amid concerns that the measure just creates more paperwork. The bill, S. 109 Lobbyist Disclosure, was introduced by Sen. Brad Miller (D-Wake) and was passed by the Senate last year. Speaking to the House committee, Sen. Miller said the increased restrictions and disclosures on lobbyists would give the public a more complete picture of how laws are made.But committee member Rep. Ed McMahan (R-Mecklenburg) said the measure would do little beyond create a mountain of paperwork for lobbyists. The measure now goes to the House floor.

Mental Health Bill Advances
The House Select Committee on Health Care Delivery on Wednesday amended and then favorably reported a bill intended to make hospitals and nursing homes take greater care with patients suffering from mental illnesses. The amendments to H. 1520 Restraints in Facilities, sponsored by Rep. Verla Insko (D-Orange), diluted several provisions of the bill opposed by hospitals and the medical community. As originally written the bill would have required hospitals and nursing homes to report all deaths of patients who had to be restrained in any way and imposed restrictions on the use of physical and medical restraints. As amended, it requires facilities to report deaths when restraints are involved, but not in cases of accidents, homicides or suicides. Also eliminated was a provision that would subject facilities to steep fines for not reporting deaths. The full House was scheduled to take up the measure Thursday.

Measure Helps Towns Pay for Sewer Projects
The state Senate gave final approval Monday to a bill that would make $200 million in state bond money available to towns as grants to improve their water and sewer systems. The measure, S1381 Reallocate Water Bond Funds, sponsored by Sen. John Kerr (D-Wayne), reallocates the money from the $800 million water and sewer bonds approved in a 1998 voter referendum. Under Kerr's bill, $146 million in bond proceeds would be transferred to programs providing water and sewer grants to local governments. The remaining $54 million would go to the Rural Center for Economic Development for grants for sewage projects. Sen. Kerr said the change from a loan program to outright grants will mean an increase of 150 water and sewer projects begun by local governments. The bill now goes to the House.

Toll Roads Bill Stalls
The state House balked Tuesday at the idea of private toll roads, voting 105-8 to return to the Finance Committee a bill that would allow three private and three state-owned toll roads as pilot projects. The action came on a floor vote on H. 1630 Toll Roads, sponsored by Rep. Jim Crawford (D-Granville). Several questions arose over granting private developers the use of state condemnation powers. The vote all but killed the bill for this year.

Legislation on Video Poker Machines Moves
With South Carolina's ban on video poker machines about to take effect, legislative leaders in North Carolina are expressing support for bills that would limit the number, location and pay-off of video poker machines that might migrate across the state line. A Senate bill, S. 1542 Video Poker Machines Illegal, sponsored by Sen. Allan Wellons (D-Johnston), makes it illegal to have more than three poker machines at one location and creates a $100 privilege tax per machine. A House proposal also sets a three-machine limit but imposes a $1,000 privilege tax and annual licensing fees. The three-machine limit is intended to exclude video poker parlors. South Carolina has banned video poker parlors effective July 1. Senate President Pro Tem Marc Basnight said he wants to outlaw pay-offs, which now are capped at $10 worth of prizes or coupons.

UNC Projects Clear Hurdle
The House Finance Committee on Tuesday favorably reported a bill authorizing the construction and financing, without appropriations from the General Fund, of several self-liquidating projects proposed by the UNC System. The legislation, H. 1853 UNC Nonappropriated Capital Projects, allows the UNC System to proceed with these projects:

Appalachian State University
New Dining Hall - Supplement $9,569,744
Steam Distribution/Return System-Reconstruction $3,109,200

East Carolina University
Diabetes Building - Planning $500,000
West End Dining Hall - Supplement $5,089,700

North Carolina School of the Arts
Technology Infrastructure - Residence Halls $1,000,000

North Carolina State University
Expansion of Parking Facilities $9,000,000
Centennial Campus Infrastructure $18,780,000
Centennial Campus Tenant Upfits $6,750,000

The University of North Carolina at Asheville
New Residence Hall - Supplement $3,720,800

The University of North Carolina at Chapel Hill
Sonja H. Stone Black Cultural Center $9,000,000

The University of North Carolina at Charlotte
Alumni Center $3,300,000

The University of North Carolina at Greensboro
Parking Deck $11,000,000

The University of North Carolina at Pembroke
Dining Hall Addition $750,000.

State Government News

Everett, Hunt to Lead Business Summit for Education
Hundreds of the state's top business and education leaders will join Gov. Jim Hunt and Mac Everett, President of First Union Mid-Atlantic, co-chairs for the event, on June 27 for the N.C. Business Summit for Education 2000. The event is designed to tap ideas and to develop workable strategies to improve family, community, and business support for North Carolina’s public schools. The Summit, a follow up to a similar statewide meeting held in 1997, is a key component of Hunt's goal to make North Carolina's schools First in America by 2010.

"In recent years, North Carolina has made tremendous progress thanks to the commitment and leadership of our business community," Hunt said. "If we can come this far, there's no reason why we can't make our schools First in America by 2010. That's what this summit is about -- building an even stronger business/education partnership, and asking the tough questions about what more needs to be done. Many of our state’s top business and education minds are coming together to develop specific ways to reinforce family, community and business support in our schools, which is one of the most important things we can do to give our young people the kind of education they deserve."

The summit, hosted by IBM and Glaxo Wellcome, will take place from 8:30 a.m. - 3:30 p.m. on Tuesday, June 27, at the IBM Employee Activity & Fitness Center in Research Triangle Park. Both companies are at the forefront of improving the quality of public education in the state.

"The quality of our state’s future workforce will be determined, to a large degree, by the quality of education we provide for our children," said Everett, who also is this year's NCCBI chairman. "First Union firmly recognizes that fact, and is committed to doing its part to further our state’s education goals. I am personally excited and proud to join forces with Governor Hunt, the visionary leadership at IBM and Glaxo Wellcome, and other North Carolina business leaders and educators to achieve real progress at this year’s event."

North Carolina was the first state to launch a Business Summit for Education three years ago following the 1996 National Education Summit, which brought together governors and business leaders from more than 40 states to jumpstart a national effort to raise academic standards.

In recent years, North Carolina has made more progress in its public schools than any other state in America by focusing on early childhood education, excellent teachers, high academic standards, safe schools and business and community support. Last year, Hunt challenged North Carolinians to take that progress even further by making their public schools the best in the nation. North Carolina is the only state in America that has set a goal of making its schools the best, and measuring its progress against that of other states.
Strategies and solutions coming out of the day-long Summit will be compiled and presented to Gov. Hunt, who will then charge his Education Cabinet – made up of the state’s top education leaders and which oversees the First in America effort – with implementing them. NCCBI President Phil Kirk, chairman of the State Board of Eduction and a member of the Education Cabinet, also will speak.

For more information about the NC Business Summit for Education 2000, or the state's efforts to improve schools, contact April White in the Governor’s office at (919) 733-5612, or Randy Williamson at Capital Strategies: (919) 932-8631.

Unemployment Rate Inches Up
North Carolina’s seasonally adjusted unemployment rate increased in May by three tenths of one percent, said ESC Chairman Parker Chesson. The jobless rate for the period rose to 3.3 percent, up from 3.0 percent in April (chart, right). In May 1999, North Carolina’s jobless rate was estimated at 3.1 percent. North Carolina’s unemployment rate remains below the U.S. rate, which also rose in May to 4.1 percent. North Carolina’s labor force was estimated at 3,930,900 in May. "We have nearly 59,000 more people at work now than a year ago," Chesson said. "Overall, North Carolina's employment picture remains quite healthy."

Durham Elections Board Rejects New Election
The Durham County Board of Elections voted 2-1 Wednesday to fire Elections Director Carol Booth in the wake of the botched primary elections in the 23rd House District . The board also voted 2-1 to dismiss 13 complaints calling for a new Democratic primary in the district. In the primary, veteran state Rep. George Miller (D-Durham) lost to challenger Paul Miller by 1,352 votes. But reports quickly came in that 4,600 voters had been moved to other precincts without first notifying them and that another 732 voters had been improperly moved into or out of the district. George Miller (picture, left) was one of the 13 petitioners asking for a new election. The whole matter is expected to end up in the lap of the State Board of Elections.

NCSU Spending Worries Bond Backers
N.C. State University's Public Safety Department possibly misspent $2.2 million in unused salary money for campus cops on expensive electronic gadgets, according to a story in the Raleigh News & Observer. Concerns immediately arose that the flap would weaken voter support for the $3.1 billion in higher education facilities bonds on the fall ballot. The General Assembly last year gave UNC System campuses greater budgetary control over how state-appropriated money is spent and accounted for.

DOT Creates Advisory Panels to Guide Spending
State Transportation Secretary David McCoy has appointed one statewide advisory panel and three regional councils help decide how North Carolina will spend $22 million under the federal Transportation Enhancement Program. The money comes from the Transportation Equity Act for the 21st century for non-traditional projects such as beautification projects, bike paths and refurbishing historic transportation facilities. The regional councils will decide how to spend $17.6 million of the grant while the state council will allocate $4.4 million. The Eastern Council will get $5.1 million for projects in Bertie, Camden, Chowan, Currituck, Dare, Gates, Hertford, Hyde, Martin, Northampton, Pasquotank, Perquimans, Tyrell, Washington, Beaufort, Carteret, Craven, Greene, Jones, Lenoir, Pamlico, Pitt, Brunswick, Duplin, New Hanover, Onslow, Pender and Sampson counties. The Central Council will get $7.9 million for projects in Bladen, Columbus, Cumberland, Harnett, Robeson, Alamance, Caswell, Guilford, Orange, Rockingham, Chatham, Hoke, Lee, Montgomery, Moore, Randolph, Richmond, Scotland, Anson, Cabarrus, Mecklenburg, Stanly, Union, Durham, Franklin, Granville, Person, Vance, Wake and Warren counties. The Western Council will get $4.6 million for projects in Alleghany, Ashe, Avery, Caldwell, Surry, Watauga, Wilkes, Yadkin, Alexander, Catawba, Cleveland, Gaston, Iredell, Lincoln, Buncombe, Burke, Madison, McDowell, Mitchell, Rutherford, Yancey, Cherokee, Clay, Graham, Haywood, Henderson, Jackson, Macon, Polk, Swain and Transylvania counties.

Education Board Plans Hearings on Policy Changes
The State Board of Education is proposing to make several policy changes as outlined below. A public hearing has been scheduled for Friday, June 30, to receive comments on the following rule changes to the North Carolina Administrative Code:

* 16 NCAC 6G .0310 Repeal Annual Performance Standards Grades 9-12
* 16 NCAC 6G .0305 Rewrite to combine all performance standards in a single rule. The rewrite also moves high schools to a prediction formula.

A second hearing has been scheduled for Monday, July 31, beginning at 9:30 a.m. to receive comments on the following rule changes to the North Carolina Administrative Code:

16 NCAC 6D .0503 State Graduation Requirements. This rule is being republished to include a change to the college/university prep course of study. The Board asked that the requirements for this course of study be consistent with the University System's admission requirements. This means that entering 9th graders for fall 2000 will be required to pass two credits in the same second language. In addition, a fourth course of study, Occupational, has been added and is presented for public comment. Both hearings are scheduled to begin at 9:30 a.m. in Room 224, Education Building, 301 N. Wilmington Street, Raleigh. Comments may also be e-mailed to the attention of Harry Wilson at hwilson@dpi.state.nc.us , faxed to 919/715-0764, or mailed to: Department of Public Instruction, 301 N. Wilmington Street, Raleigh, NC 27601-2825.

Federal News

N.C. Likely Won't Join Other States in Major Expansion of Unemployment Insurance

North Carolina -- which historically has run one of the nation's most progressive unemployment insurance programs -- apparently will not be among states participating in a new federal program that allows states to use unemployment insurance money to provide workers with up to 12 weeks paid leave after a birth or adoption in their families.

The new program, proposed by President Clinton earlier this year, was finalized in U.S. Department of Labor regulations published in the June 13 Federal Register. Click here to read a text of the DOL regulation.
The National Association of Manufacturers and the U.S. Chamber of Commerce are promising an all-out court battle to block the new regulation, which is a major expansion of the 1993 Family and Medical Leave Act. FMLA already provides workers with 12 weeks of unpaid leave from the jobs after a birth or adoption in the family.

The U.S. Chamber said it's “one of the most ludicrous proposals to emerge in years” to use unemployment insurance money to pay workers to stay home after a birth or adoption. "If there ever was a case of robbing Peter to pay Paul, this is it,” said Patrick Cleary, NAM vice president for human resources policy. “Under the guise of helping working families, the Clinton Administration is raiding the unemployment trust fund that serves as a safety net for unemployed workers so he can score political points during a booming economy," Cleary added.

NCCBI is the state affiliate of both the NAM and the U.S. Chamber.

Business groups estimate extending paid leave for births and adoptions would drain as much as $14 billion a year out of state unemployment insurance trusts funds if all 50 states participated. The U.S. Labor Department estimates it would cost just $196 million if only the 15 states that so far have expressed interest participate.

The 15 states that have indicated they will participate in the program are California, Florida and those in the industrial Northeast.

David Clegg, deputy commissioner of the N.C. Employment Security Commission, said he had talked informally with the seven ESC commissioners and heard little interest from them in participating in what's called the BAA-UI program (for Births And Adoptions, Unemployment Insurance). He said it was possible that a formal vote by the full commission on the issue could come during the commission's scheduled June 29 meeting. “I haven't perceived any sentiment that they (ESC commissioners) want to get involved,” Clegg said.

Clegg also pointed out that, even if the ESC commission voted to participate in BAA-UI, it would require approval from the General Assembly before the ESC could proceed.

“North Carolina has historically been at the forefront of unemployment insurance social issues,” Clegg said. He noted that the state, which provides the highest unemployment insurance weekly benefit in the Southeast, has a provision which allows workers to receive unemployment benefits if they miss work as the result of domestic violence. North Carolina also has a provision which allows for the payment of benefits if a worker has to change the shifts he or she works and the change causes problems with child care.

“We feel that we have taken the lead nationally and have addressed issues such as this,” Clegg said. “This has not been one of them.”

Clegg said there is a concern that BAA-UI would imperil the solvency of North Carolina's unemployment insurance trust fund, which now stands at $1.2 billion. “That sounds like an incredible amount of money, but with the growth of North Carolina's labor market, if we were to experience a recession like we had in the late `80s and early `90s, that $1.2 billion would last us about 18 months.”

The NAM's Cleary said the idea is a radical change in the whole concept of unemployment insurance. "Unemployment insurance isn't for people who have jobs; it should be reserved for the unemployed, particularly in light of the Department of Labor's disclosure that, even today, some 25 states currently have insufficient unemployment insurance reserves,” he said.

"While it is our view that the Clinton Administration's so-called `Baby UI' proposal violates both the Federal Unemployment Tax Act and the Family and Medical Leave Act, at the very least it is back-door rulemaking at its worst,” Cleary concluded.

Pay Gap Narrows Between Men, Women
Women still aren't paid as much as men who work in the same job, but the gap is narrowing, the U.S. Department of Labor said in a report. Women's earnings as a percent of men's earnings have risen from 62.5 percent in 1979 to 76.5 percent in 1999, the report said. The pay gap is worse for black and Hispanic women whose earnings have grown very little. More women are working in occupations that pay well, but even within those occupations they still make less than men. In each of the top 10 occupations with the highest earnings for women, there is at least a 9.5 percent pay gap. However, the overall condition of the American worker continues improving. Unemployment is less than half of the rate in Europe. Among those with a college degree, that rate is an astonishing 2.1%. Other statistics:

* Since 1991, the U.S. economy has created 15.6 million new jobs. Of these, 12 million have been in such high-skilled, higher-knowledge occupations as systems analysts, accountants and computer engineers.

* Total compensation (salary plus benefits) is at an all-time high. In 1997, the average total compensation was over $40,000 per year – $48,000 per year in manufacturing.

* Over 99 percent of manufacturers provide health care benefits to their employees; 78 percent contribute to 401 (k) and pension plans; 54 percent have bonus plans and 35 percent have pay-for-performance incentives.

* Today’s workers are also becoming today’s owners. In 1975, only .28 percent (one-quarter of one percent) of those employed nationwide were involved in some form of employee ownership. Today, 16 million workers -- 12.4 percent of civilian employment in the U.S.– are offered employee ownership plans.

* Unfortunately, the burden of higher taxes on the average worker has created a very real sensation of "working more for less" in spite of their relative prosperity. Since 1949, the FICA tax rate alone has increased 520 percent.

Four N.C. Cities Win Grants for Airports
Federal Department of Transportation grants totaling $7.7 million are being handed out to four North Carolina communities to upgrade and maintain safety at their airports, said U.S. Sen. John Edwards (D-N.C.). Moore County will receive $2,611,111 to improve runway safety areas, expand the terminal building, install new lighting and rehabilitate runways. Charlotte will receive $2,533,425 to repair lighting and expand ramps to handle growth in commuter traffic at Charlotte-Douglas International Airport. the Greensboro-High Point Airport Authority will get $1,345,000 to relocate a road to accommodate construction of a runway safety area at Piedmont Triad International Airport. Onslow County will get $1,242,439 to rehabilitate a runway at Albert J. Ellis Airport.

Death Tax
When you get two-thirds of the House to vote for a bill to repeal the death tax, you've done a good job telling your side of the story. That's what happened in June, as a bill to eliminate the death tax roared out of the chamber. H.R. 8 passed 279-136. A whopping 65 Democrats supported it. The bill would phase out the death tax, reducing the rates down to zero over 10 years. The Administration opposes the bill, arguing the tax adds progressivity to the tax code and doesn't affect more than a few families. But small manufacturers and family farmers carried the day. During debate on the bill, the Administration, which has actually proposed raising estate taxes, threw its support behind a legislative fig leaf offered by Rep. Charles Rangel (D-NY). That measure failed 222-196. With polls showing that nearly 80 percent of Americans support repeal, you'd think the bill would be a slam-dunk in the Senate. Senate Democrats may try to bottle it up to avoid an embarrassing veto. Stay tuned.

Ergonomics
If the House has its way, OSHA won't be able to spend a nickel to implement its proposed ergonomics rule. The ban cleared the House 220-203 and is now part of the Labor Department spending bill for FY 2001, which begins 10/1. The President is threatening to veto it. And if he gets his way, OSHA will have a green light to issue the most expansive workplace rule ever. It would trigger an OSHA-scripted ergonomics program at your plant if just one employee reports a repetitive-motion injury caused by or aggravated by work. Injured employees would immediately qualify for extended time off at 90 percent disability pay. The agency wants to publish the final rule this year -- no matter what. This means, absent a legislative ban, the courts may be our last resort. OSHA says it expects lawsuits from industry -- and from organized labor, which, believe it or not, thinks OSHA's proposal isn't tough enough! With sound science on our side, we expect to prevail, if not in Congress, then in court. In the House vote, North Carolina's seven GOP members of Congress voted to sustain the ergonomic ban and were supported by one Democrat, Mike McIntyre. The Senate followed through and upheld the House position, with Sen. Jesse Helsm (R-N.C.) supporting the NCCBI position and Sen. John Edwards (R-N.C.) opposed. The seven Republican members of North Carolina's Congressional delegation all voted to uphold the ergonomics funding ban and were joined by one Democrat, Mike McIntyre. The Senate followed through and side with the house to block OSHA on ergonomics. In that vote, Sen. Jesse Helms (R-N.C.) supported the ban and Sen. John Edwards (D-N.C.) opposed the NCCBI position.

Health Care
True to form, Sen. Ted Kennedy (D-MA) tried to pull a fast one in June. Not satisfied with the progress of a House-Senate conference committee working on a final managed health care bill, he surprised many by springing a House-passed bill that would expose manufacturers to employee lawsuits. The bill, which was offered as an amendment to unrelated legislation, was voted down 51-48. In the end, all but four Republicans voted to stop Kennedy. No Democrats crossed party lines. The House-passed "patients bill of rights" is loaded with coverage mandates and an explicit, broad employee right to sue. Managed care providers and employers would immediately be vulnerable to malpractice and other health-care suits. Though Kennedy's amendment failed, other attempts to force a vote in the Senate could emerge.

Foreign Sales Corporation (FSCs)
"Thanks, but that's not good enough." That's what the European Union (EU) is telling U.S. trade negotiators after an offer was made to replace a U.S. tax provision that helps American firms of all sizes ship goods abroad. The issue at hand is foreign sales corporations (FSCs), which the WTO says are an illegal export subsidy. The U.S. must now rewrite the FSC tax rules or face retaliatory trade sanctions. Billions of dollars are at stake. FSCs allow up to a 15 percent tax reduction on gross export income. Smaller manufacturers stand to lose, as many participate in what's called a "shared FSC." The replacement regime offered by the U.S. to the EU seeks to maintain the tax benefits of FSCs and stay within the guidelines of WTO trade rules. Even though the EU rejected the U.S. proposal to replace FSCs, the U.S. apparently will stick with it and work to see it enacted into law before Congress adjourns. The EU would then be forced to rechallenge the tax regime under WTO dispute rules.

OSHA Schedules Hearing on Ergonomics Rules
OSHA will hold a public hearing in Atlanta on July 7 to receive comments on the economic impact of its proposed ergonomics standard on railroads, state and local governments and the U. S. Postal Service. The hearing will begin at 9:00 a.m. in Conference Rooms B&C of the Sam Nunn Atlanta Federal Center at 61 Forsyth St., S.W., Atlanta, Ga. 30303.

Names in the News

*Joseph McGuire of Asheville received the Distinguished Leadership Award from the National Association for Community Leadership. McGuire, an Asheville attorney and partner in the firm of McGuire, Wood & Bissett, is past president of the Leadership Asheville Forum, the alumni association for Leadership Asheville and Leadership Asheville Seniors. He is the 1999 recipient of Leadership Asheville Forum's Circle of Excellence.

*Jeff Lane, an aide to Senate Democratic Minority Leader Tom Daschle, D-S.D., has been hired by Sen. John Edwards (D-N.C.) as his new chief of staff. He replaces Karen Robb, who resigned in January to work for the White House. Lane is a Duke law school graduate who had been Daschle's administrative assistant. He'll start in July.

* Miss Topsail Island -- UNC-Pembroke senior Lorna McNeill of Lumberton, was crowned Miss North Carolina last week. McNeill, 23, believes she is the first Lumbee Indian to win the title.

* State Rep. Steve Wood of High Point, one of only three incumbent legislators to lose in the May party primaries, said he is leaving the Republican Party and will run as a Reform Party candidate this fall to try to keep the seat he's held for 14 years. Wood was expelled from the House Republican caucus last year after voting with most of the Democrats in election for House Speaker, which Jim Black won by a single vote. Elections officials were trying to determine whether Wood can legally get on the November ballot for his House seat.

* Dan Shephard, 41, was elected vice president and treasurer of Martin Marietta Materials Inc.Shephard, who has been with the Raleigh-based company since 1989, currently serves as president of the Magnesia Specialities unit and have ovesight responsibility for the comapny's information systems function.

* The Democratic Party of North Carolina announced the names of the delegates who will attend the national party's nominating convention. Attending will be 75 Gore delegates, 13 Bradley delegates and 13 alternates. The 15 super delegates will be state party Chairman Barbara Allen of Raleigh; Gov. Jim Hunt, U.S. Sen. John Edwards (D-N.C.), Cong. Eva Clayton (D-1st), Cong. Bob Etheridge (D-2nd), Cong. David Price (D-4th), Cong. Mike McIntyre (D-7th), Cong. Mel Watt (D-12th), Sen. Frank Ballance (D-Warren), Rep. Dan Blue (D-Wake), Revenue Secretary Muriel Offerman, Mandy Carter of Durham, Jeanette Council of Fayetteville, Everett Ward of Raleigh and Jim Young of Greenville.