NORTH CAROLINA: Obama Administration Considers Cutting Off Billions In Funding Over Anti-LGBT Hate Law

The New York Times reports:

The Obama administration is considering whether North Carolina’s new law on gay and transgender rights makes the state ineligible for billions of dollars in federal aid for schools, highways and housing, officials said Friday.

Cutting off any federal money — or even simply threatening to do so — would put major new pressure on North Carolina to repeal the law, which eliminated local protections for gay and transgender people and restricted which bathrooms transgender people can use. A loss of federal money could send the state into a budget crisis and jeopardize services that are central to daily life.

Although experts said such a drastic step was unlikely, at least immediately, the administration’s review puts North Carolina on notice that the new law could have financial consequences. Gov. Pat McCrory of North Carolina had assured residents that the law would not jeopardize federal money for education.

But the law also represents a test for the Obama administration, which has declared that the fight for gay and transgender rights is a continuation of the civil rights era. The North Carolina dispute forces the administration to decide how aggressively to fight on that principle.

North Carolina Lt. Gov. Dan Forrest remains defiant: “It would be wrong — even illegal — to single out North Carolina for unfavorable treatment. I’m confident that we will continue to receive this federal money despite the threats from a few in Washington, D.C.”