New N.C. budget director Andrew Heath rises quickly to key post

For Andrew Heath, it has been a rapid rise.

A private attorney just out of law school in 2006 and chairman of the N.C. Industrial Commission by mid-2013, he’s now Gov. Pat McCrory’s state budget director, starting Monday.

Heath, 34, is taking one of state government’s most important jobs, translating the governor’s priorities into numbers to recommend to the legislature. What he does can affect tax policy, state employees’ pay, the size of government and more.

Heath, with an annual salary of $145,000, also will lead a state agency, the Office of State Budget and Management, which monitors revenue and expenses and is supposed to promote effective use of resources.

And supporters say that’s how Heath fits the job. Although he doesn’t have the direct financial background of his predecessors — he was a workers’ compensation attorney who applied that know-how at the Industrial Commission — backers say he has packed government leadership and results into a brief career.

“He has a significant advantage that I did not have coming in,” said outgoing budget director Lee Roberts, “which is that he is already running an agency in state government. He knows the players; he knows the lay of the land. When I started, I didn’t even know what most of the acronyms stood for.”

Roberts’ experience was mostly in banking. After roughly 18 months as budget director, he announced recently that he was returning to the private sector.

Roberts said Heath is known for getting things done.

In a recent interview, Heath opened a booklet of numbers and graphs to show action during his less than three years as chairman of the Industrial Commission, including tapered spending and an increase in penalties collected from employers who weren’t compliant with workers’ compensation coverage requirements.

“In the past, the commission only saw noncompliance after the injury occurred,” Heath said. “You don’t want it to get to that point.”

N&O reporting has spotlighted the state’s lack of policing of workers’ comp insurance in recent years. Under Heath, the commission last fiscal year collected nearly $1 million in fines from noncompliant employers, compared with $175,000 two years earlier. One hundred employers were charged with related misdemeanors.

“He’s the one who took initiative,” said Bill Rowe, general counsel with the left-leaning N.C. Justice Center, which has worked on the issue. “He’s the one who started collecting more fines and penalties and getting businesses compliant, and also was the one who took the initiative to try to find some solutions for North Carolina to try and deal with a serious problem.”

The commission has about 160 employees and a $15 million budget, with 22 deputy commissioners. Heath, as chairman, was in charge of appointing deputies, which generally were career positions until a 2014 law change made them political appointments.

After he joined the commission as chairman, Heath said, he eyed deputies’ travel expenses for cuts. Rather than send a deputy commissioner to the injured worker’s locale for a hearing, he and his team planned out regional offices for deputies. He said the subsequent productivity gains, in addition to trimmed expenses on mileage and lodging, justified the elimination of two deputies, whose salaries were about $100,000 each. Added up, the savings far eclipsed the roughly $70,000 outlay for the regional office leases, he said.

“We try to find low-hanging fruit like that and implement it here at the commission to achieve cost savings,” he said. “And that’s an example of a program that we came up with, we planned for and we executed, and I want to take that sort of model to the budget office and try to encourage programs like that across the state.”

McCrory supporter

Heath has contributed financially to McCrory in his gubernatorial bids. Campaign finance reports at the State Board of Elections show that Heath gave at least $1,225 to McCrory, mostly between summer 2011 and fall 2012.

McCrory appointed Heath to the Industrial Commission in February 2013, at which point Heath was barred from such political giving under the judicial code of conduct. He hasn’t contributed to any candidate since.

After Heath’s announcement as budget director, some took to social media to portray him as a McCrory faithful with more political alliance than experience. A posted photo showed him wearing a McCrory campaign sticker as a Cape Fear Young Republicans organizer at a 2012 fundraiser.

“I don’t think it’s a surprise that I’m a McCrory supporter,” Heath said. “I was a McCrory supporter in 2008. I was a supporter in 2012. And of course I am now. I’m a fan of the governor, and I’m a fan of what he’s doing.”

When asked why he sees Heath as qualified to be budget director, McCrory in a statement pointed to Heath’s work at the commission. The governor said he was “confident that (Heath) will continue the high standards of excellence and leadership that have been set by his predecessors” — Roberts and, before that, businessman Art Pope.

Timing may be good

Observers say Heath comes in at a good time.

A base spending plan already is in place for this fiscal year and next, and it will be nearly May before the legislature meets to discuss updates.

He has been shadowing Roberts at meetings with state department heads to get a handle on their financials and operational needs.

And, Heath says, the state is in good budgetary health. “The challenge for me is just to keep it on the same trajectory.”

Rep. Nelson Dollar, a Cary Republican and senior budget writer in the House, noted that while the budget director communicates the governor’s priorities, any state budget goes through plenty of crafting hands in the legislature. “I think that anyone who’s in that role has a learning curve,” Dollar said. “We’ll work with him. We want the budget process to be successful.”

House and Senate Democratic leaders did not respond to requests for comment.

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JANUARY 30, 2016 11:06 AM