N.C. budget OK’d

Published 9:26 pm Thursday, June 21, 2012

RALEIGH, N.C. (AP) — The North Carolina Legislature on Thursday approved the final Republican-penned state government budget for next year, a plan that doesn’t raise taxes but fails to trim public school cuts to the level sought by Gov. Beverly Perdue and fellow Democrats.

After separate debates, the House and Senate voted for the $20.2 billion spending plan, which adjusts the second year of the two-year budget approved in 2011. Perdue will now have 10 days to decide whether to veto it or let it become law. She vetoed a two-year budget last year, but the veto was overridden.

Thursday’s votes — 71-45 in the House and 30-15 in the Senate for the final plan — would exceed the three-fifths majorities required in each chamber to overcome her veto. Several lawmakers didn’t vote or were absent. Additional override votes would be required.


Perdue spokesman Mark Johnson said she was reviewing the budget but didn’t say what she would do. She canceled a scheduled speech in Raleigh to study the legislators’ plan. Perdue’s leverage could be weakened this year because there’s a budget already in place and GOP legislators have suggested they could go home for the year early next month without the adjustment in place.


The plan was developed from competing House and Senate plans after less than a week of formal negotiations. They noted the bill provides the first pay raise for public school teachers and state employees since 2008 and calculate there’s $251 million more money to K-12 compared to what the two-year budget had allowed.


“We answered the governor’s call to invest in education and other priorities, and we look forward to her signing this budget,” said Senate leader Phil Berger, R-Rockingham, said.


But Democrats balked at the $251 million figure, pointing out the amount incorporates the teacher pay raise. And the $503 million that school systems were expected to return to the state next school year was reduced by $143 million. The House spending plan had cut the $503 million by more than $330 million.


When the loss of $259 million in federal money used to hire 5,400 local school personnel is taken into account, the 115 districts combined would have $189 million less to work with next year, according to data provided by the General Assembly’s nonpartisan fiscal staff. Democrats said the decline is the equivalent of 3,400 education positions.


House Minority Leader Joe Hackney, D-Orange, urged Perdue to veto the budget. He said North Carolina citizens would be unhappy if legislators left town without working through contested budget adjustments with Perdue.


“It certainly would be on their heads if that happened,” Hackney said.


Other cuts within the University of North Carolina and community college systems that began last year weren’t restored, and neither were 20 percent reductions to Smart Start and North Carolina Pre-Kindergarten early childhood initiatives, said Sen. Josh Stein, D-Wake.


“We are turning our backs on our commitment to the young children,” Stein said in the debate.


Republicans countered that Perdue and Democrats would have raised the sales taxes for the coming year to make up for cuts — the last thing families need as the economy continues to sputter.


They said most of the required school district reductions were approved during Democratic rule in the Legislature before 2011 and that job losses never met the Democrats’ dire predictions of 10,000 or 15,000 this past year.


“If you don’t like this budget, what’s your answer?” asked Rep. Bryan Holloway, R-Stokes. “More tax increases?”


The bill also sets aside $27 million mostly for literacy efforts in early grades and tries to control Medicaid spending problems that vex legislators annually in part by setting aside $100 million in reserves for potential cost overruns.


“Budgeting conservatively is the right approach,” said Rep. Nelson Dollar, R-Wake, co-chairman of the House Appropriations Committee.


The budget provides 1.2 percent pay increases to state-paid public school personnel and state employees. Universities and community colleges can offer differing pay based on performance or bonuses.


The budget bill spends $727 million less than what Perdue offered in her budget proposal last month. She included a three-quarter cent increase in the sales tax, which her office said would have generated $760 million in the coming year.


Five Democrats joined 66 Republicans in voting for the plan. One of the five, Rep. Marian McLawhorn, D-Pitt, hadn’t voted last month for the House budget. She said she changed her mind because public employees in her region have been lobbying for a raise. The Senate budget vote was on party lines.


The House and Senate versions of the budget provided several hundred thousand dollars to tap into more than $4 million federal matching funds to maintain voting machines and early voting sites and train poll workers. The money was absent, however, in the final budget.