Dale Folwell wants NEW TAXES.

I soooo hoped that this is some of that fake news that our state drivebys are so fond of concocting. But it isn’t.  

I don’t know how much more back-stabbing and selling-out I can stand.  

From what I know of Dale Folwell personally, and from what I’ve seen of his work in the General Assembly and at Employment Security, that headline makes NO SENSE.  I’d believe Folwell desiring more fiscal restraint, or less spending, before new taxes.

But, that is the headline the drivebys are presenting us with.  Here are some of the highlights of the interview with Folwell.

One of the biggest and most under-reported problems in the state right now is happening at the state treasury department.

As far as pots of money go, the North Carolina Treasury is the big dog in the state by a distance. By one recent ranking, it’s the 26th largest pool of public money in the world.

And right now, that $110 billion fund is in big trouble.

“The 28th Treasurer of North Carolina is going to face financial challenges with the pension and the health care plan that the state has never seen before,” said Dale Folwell, CPA — North Carolina’s 28th State Treasurer. “It just has to do with the math.”

Folwell likes when reporters tag that “CPA” on the back of his name. He’s a certified public accountant and he says now, more than ever, that means something.

“The Folwell Administration is going to be focused on not emotion, not politics but mathematics,” he said.

Here’s the problem as Folwell broke it down. The state pension plan – currently about $90 billion – is underfunded by about $15 billion and the state health plan is unfunded (you read that right) by $32 billion.[…] 

That’s about irresponsibility on the part of our, um. “leaders” on Jones Street.  It’s NOT an opportunity to raid my already nearly-depleted wallet.  MORE: 

“I can tell you that if we don’t attack and solve these two particular issues,” Folwell said. “The things that your viewers care about, which is the core functions of state government, are going to be impacted.”

How did the state find itself with a hole that big? Here’s how Folwell explained it, at least as it relates to that $32 billion hole in the health plan.

“As health care costs ballooned and the number of people employed by the state increased as a result of the population increasing, as all of those things have happened, the state health plan is on what’s called a “pay-go” basis. When we are presented a bill from a doctor, hospital or pharmacy, we pay that bill, so we’re on a pay-go basis. The pay-go is going to require almost 3 billion dollars a year, every year, at least. Starting right now. And that’s only going to be increasing,” he said.

And Folwell said a big problem with an unfunded health plan is that it begins to implode on itself.

“Beginning teachers, beginning troopers, beginning state employees, who are protecting us from crime, educating our children, and who are involved in the state health plan; they can afford the individual coverage but they can’t afford the family premiums. So what’s happening is, we’re not attracting young, healthy people to the state health plan. And you cannot have an insurance company where you don’t have young, healthy people in it,” he explained.

“These two items, just the pension and health care, are going to require over $4 billion a year out of the General Assembly in the next 15 years. Just to fund the health care and pension liability of these two plans,” he said.

Folwell continued, saying the only way to get there is to raise taxes.


Um, NO IT IS NOT.   THAT is the big-government lover’s answer.   THAT is the statist, control-everybody type’s answer.  THAT is the answer you expect from the folks we kicked to the curb in 2010.

How about trying a little fiscal restraint, first?  Just a little?  Cut off the solar and wind people.  Defund half to three-quarters of the Department of Administration.  “Cultural Resouces,” anyone?  That’s just for starters.   

He said the first thing, however, is ramping up efficiency.

“Find ways to cut out waste, fraud and abuse,” Folwell said. “Only after I’m satisfied that I’ve found all I possibly can, then will I be going to the General Assembly and the taxpayers.”

Folwell said he’ll also find the state extra money in reductions to fees paid to Wall Street money managers.
“The state pension fund last year paid over $500 million in fees to Wall Street to manage the state pension fund,” said Folwell.

Fees which he says have ballooned from $50 million to $500 million in just the past 15 years.

“We’re going to cut those Wall Street fees by at least 100 million dollars,” he offered.

A big part of the reason fees have soared is the Treasury’s move to put more money in high risk investments, or “alternative funds.” Former Treasurer Janet Cowell shifted approximately 40% of investments to these higher risk accounts but, as critics point out, never achieved higher returns on those investments than the state could have gotten in more standard funds.

Another area Folwell says he intends to depart from Cowell’s administration is transparency. Cowell faced fierce criticism over the secrecy she allowed to surround much of the money in the state pension and health plans. Folwell says that won’t happen on his guard.


How many of you would have voted for this guy if you KNEW he felt like this prior to November?

10 thoughts on “Dale Folwell wants NEW TAXES.

  1. I would have. I share his profession and respect his ability to analyze the misdeeds of the past. The only choices are to continue down the same irresponsible path or find a solution to a disguised problem.
    Raising taxes should be the last resort. Personally I believe the state employees are not paying a fair amount for their premiums. Taxpayers are paying for their bill. The article is correct – family coverage is enormous but so is everyone else’s.
    It’s a complicated problem when all sorts of promises are made to employees and we push the explosion to our grandchildren. Same is true with SS and Medicare etc. but they are not funded at all. Shameful government policies are being exposed in a clear, understandable way. I think if people had been listening Mr. Folwell spoke to some of this in the campaign. Can’t quote anything specifically but this issue is no shock to me.

  2. He may be speaking the truth in a sense. Before we raise taxes though, consideration of lowering some benefits and having employees pay their fair share need to be visited as well. All companies in this day and age have been decreasing their contributions to the employee benefits…and the state needs to do the same. The next consideration needs to be directing some funds away from other areas of government too. All of these perks like Medicaid and other welfare may need to be decreased some…heck we paid up several billion to the Feds when we re-jiggered the unemployment insurance…why not find a way here?

    After all of the above…maybe a tax increase.

  3. Dale is the one politician I trust. I’d pay more taxes if he says we need to do it, but the money has to be guaranteed to go where he says it should go.

  4. The NC General Assembly has FULLY funded the pension plan plus millions of extra each year for the last 4 years. I will be going to the NCGA and the taxpayers explaining how we got here : not to ask for a tax increase. We didn’t do it, we discovered it and are going to fix it. Thanks,

    Dale R Folwell,CPA
    NC Treasurer

  5. The question for Dale is where else can we cut as a Government? I have known and trusted him for a long time , hopefully this is the first of many discussions with him.

  6. It’s a no brainier, state employees, if they want this benefit, should step up and pay for it. We don’t need the best and brightest going into taxpayer-subsidized service employment but, out here with the rest of us holding down real jobs. Drive thru any nice neighborhood and note the homes owned by government employees. Go into a high priced restaurant and see how many diners are government employees. THEYCAN PAY THEIR WAY.

  7. As a state employee I had not even come close to total compensation as private sector did or the military. Pensions do need to go. But I do know some state employees are overworked with unrealistic timelines and underpaid while others are a freggin’ cake walk.

  8. Mr. Folwell proves the old adage, “The bit dog always barks”, by snowflaking his denial on this site. Mr. Clifton is a real stand-up guy for posting it, but none of us are quite convinced.

  9. The way big corporations do it is ask the employees where the waste is first. They know. They would whistle blow if they knew it wouldn’t put their jobs in jeopardy. Managers traditionally don’t like their employees finding better ways to do things. They don’t want anyone poking around in their turf. Cost savings and cost avoidance must be mandated before anyone gets raises or before any new people are hired. One means is Six Sigma. It is common sense and it works.

    Thank you Dale for being transparent. We support your candor.

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