HB2 could put education funding at risk

CHARLOTTE, N.C. — Fallout from the Department of Justice warning on House Bill 2 could also hit local schools including K-12 and universities.

That's because DOJ said the university system is also breaking federal law by discriminating against transgender students.

The Department of Justice said Wednesday that HB2 violates federal law.

That also applies to state schools that the department said cannot treat transgender students differently by barring them from using a bathroom based on gender identity.

University of North Carolina system President Margaret Spellings received a letter from the department that said in part, "Federal law prohibits UNC from discriminating based on sex, including gender identity."

The letter said while the anti-discrimination laws allow for gender-specific bathrooms, showers and other school facilities, it's not legal to treat transgender students differently, the DOJ argues.

The letter to UNC then speaks of government action if the law is not repealed.

"If we do not receive assurances and documentation on or before close of business on May 9, 2016, demonstrating UNC has taken the actions described below or comparable steps to achieve compliance, the department will take enforcement action," the letter read.

Experts told Channel 9 that action could be withholding federal money from any Title 7 or Title 9 program that seeks to maintain equality in schools or school programs.
 
"The biggest fallout is going to be uncertainly for schools," Marshall Jones, a school funding expert at Winthrop University, said. "If that money goes away through Title 7 or Title 9, those programs could cease to exist."

Jones said that's because there are no other funding sources, because that money cannot be used for other programs.
Here's what the federal government spent in North Carolina last year.

• $961 million for K-12 schools
• $1.9 billion on higher education and adult education
• $2.3 billion in student loans

That's a total of 5.2 billion dollars but it does not include other big funding sources like federal grants.

The UNC system alone received $1.4 billion last year.

Jones said higher education could take the biggest hit because of lost grant funding and Title 9 money.

"North Carolina is under a remarkable amount of pressure at the moment," he said.

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