(The Center Square) – The North Carolina Supreme Court heard arguments Monday on whether the General Assembly violated the state's constitution when it appropriated three federal block grants contrary to how Gov. Roy Cooper intended the funds to be used.
Cooper believes he should have had the final say in how the federal funding for community development, substance abuse and maternal and child health should have been spent because Congress designated the funding.
After losing the argument in lower court, Cooper has asked the state's highest court to review the General Assembly's legal authority behind its decision.
Cooper laid out his plan for the aid in 2017 in his spending proposal, but lawmakers passed the budget with $17 million in grants distributed differently.
Cooper filed the lawsuit against House Speaker Tim Moore, R-Cleveland; Senate Leader Phil Berger, R-Rockingham; North Carolina Industrial Commission Commissioner Charlton Allen; and former vice chairperson of the commission, Yolanda Stith.
Cooper's legal team alleges the allocations violated the state's separation-of-powers rules.
The appellate court ruled in favor of the General Assembly in December based on a state law that says: "[N]o money shall be drawn from the state treasury but in consequence of appropriations made by law."
Cooper's attorney, Jim Phillips, argued Monday although other parts of the constitution reference General Assembly appropriations, that particular provision does not limit them to only the Legislature.
The federal grants were "custodial funds" already appropriated by Congress, Phillips said. By appropriating the funds differently, Phillips said the Legislature overstepped its authority.
Defense attorney D. Martin Warf argued the state, not separate entities of the state, were the recipients of the grants, and, by law, the General Assembly is in charge of appropriating state funds.
Warf said federal law does not explicitly block legislative allocation of the grants, and state law only dictates the rules for money passed through the state treasury.
"Third, our state constitution and laws divide the responsibility for enacting a budget of anticipated revenue and proposed expenditures of the state, between the legislative and executive branches," Warf said. "This has been the status quo since the current constitution was enacted."
Warf said Congress appropriates the money to federal agencies, and then agencies disburse the money to states after applying for it, according to federal law.
"That's where Congressional appropriations end," he said.
Cooper also sued the state, Moore and Berger on Friday for more authority over the Rules Review Commission, one of many legal power battles the Democratic governor and Republican-led Legislature have pursued against each other.