House, Senate reach agreement on two-year state budget

Posted July 21, 2013
Updated July 22, 2013

— House and Senate leaders announced Sunday that they have reached an agreement on a $20.6 billion state budget that will end teacher tenure and allow taxpayer money to be spent for private school tuition.

A final draft of the bill and an accompanying "money report" the provides much of the detail in the budget were posted online late Sunday night.

Both chambers have previously passed their own spending plans, but Republican leaders wrangled for weeks to come to a consensus even as the July 1 start of the 2013-2014 fiscal year came and went.

Republicans took over the General Assembly in 2010 for the first time in more than a century, but did not cement full control of state government until GOP Gov. Pat McCrory took office in January.

Both the House and Senate are expected to give the spending plan at least tentative approval on Tuesday.

According to a joint news release issued Sunday evening by Senate President Pro Tempore Phil Berger's and House Speaker Thom Tillis's offices, the 2013-2015 budget increases overall state spending by 2.5 percent while instituting a previously-passed tax plan that lowers the corporate and personal income tax rates.

The plan allocates $23.6 million in funding for a measure that scraps the longstanding teacher tenure system in favor of employing educators on contracts that are renewed based on performance reviews.

Starting in 2014, it would also set aside $10 million to allow families that meet income guidelines to get state money to pay private school tuition.

The news release makes no mention of raises for teachers or employees but does provide five bonus-leave days for state employees and fully funds the state retirement system and state health plan.

Berger, R-Rockingham, and Tillis, R-Mecklenburg, touted the spending plan as one that "safeguards North Carolina's long-term fiscal health" and also "invests in core services, streamlines state government, strengthens public education and grows North Carolina’s economy."

"Together, members of the House and Senate have carefully crafted a plan that smartly invests in key priorities like education and public safety while fulfilling our shared commitment to fiscal responsibility and accountability in state government," Berger said in a statement.

Liberal groups were less pleased with the final product produced after weeks of negotiations between Republican lawmakers.

"Lawmakers chose to drain available revenues by $524 million over the next two years through an ill-advised series of tax cuts that primarily benefit the wealthy and profitable corporations," wrote Alexandra Forter Sirota, director of the North Carolina Budget and Tax Center, which has been critical of the Republican-led legislature.

"This revenue loss isn’t just a number on a piece of paper — it means fewer teachers in more crowded classrooms, higher tuition rates and elevated debt load for families, scarcer economic development opportunities for distressed communities, and longer waiting lists for senior services."

Other highlights of the budget deal:

State spending on Medicaid is increased by $1.5 billion to cover what Republicans term as cost overruns. A special provision would allow the McCrory administration to develop a Medicaid reform plan in the coming months.

The budget also supports McCrory's plan for overhauling the North Carolina Highway Trust Fund, which prioritizes and pays for transportation infrastructure projects over the next 10 years.

The plan restores funding that had been previously cut for 69 positions within the State Highway Patrol, as well as another 22 magistrates and 175 probation and parole officers.

The budget meets the state's obligation to fund the state retirement system and state health plan, while providing state employees with 5 additional days of leave. The release makes no mention of any raise for state employees, whose salaries have remained largely stagnant for years.

The budget also eliminates state funding for the nonprofit Rural Economic Development Center, which was stung by a negative audit last week, triggering the resignation of its long-time president. In its place, the legislature is creating a new division within the North Carolina Department of Commerce to focus on improving services to the state's rural counties.

Victims of a state-sponsored eugenics, or forced-sterilization, program that ended in the 1970s will receive a one-time compensation. The budget allocates a $10 million fund, which will be split between all who apply by June 20, 2015. A group set up to help victims estimated up to 1,800 were still living last year, though it had only verified 146 of them.

Approximately $230 million will be set aside for the rainy day fund to protect against future shortfalls, bringing the total to approximately $650 million.

"Once again, Republicans in the General Assembly have produced a state budget that reduces taxes and right-sizes state government," House Speaker Thom Tillis, R-Mecklenburg, said in a statement. "This budget is another crucial step in putting North Carolina’s fiscal house in order."


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  • geaton Jul 23, 2013

    It amazes me that there is money to give to women because they did NOT have babies but no money for state workers who are busing their behinds. Yes, some of do work and work hard! I agree with one of the other posts on here. Plenty of babies needing adoption. Give them one!

  • kliberto Jul 22, 2013

    If they really want to save money on the state-sponsored eugenics program, why don't they give these victims the unwanted babies they plan to force women to have with their anti abortion laws.
    And if anyone thinks the voucher system is to better our education, then I'm sure you will still vote republican if your living in a box under a bridge. This money is going to the corporations that own the schools and own the GOP representatives. Once again ALEC wins NC, and the decline of NC continues.

  • tropicalgirl Jul 22, 2013

    What about state employees and merit pay? While there's a small chance for teachers to earn merit pay next year, no money was put in the budget for state workers to do so - instead they're paying a million to "study" state employee pay. This budget effectively means that state employees have no chance for a raise for the next TWO years, on top of the 5-6 that have already passed.

  • midnightclay Jul 22, 2013

    Glad to see the teacher tenure plan scrapped and implementing a plan based on PERFORMANCE. Hopefully they won't fudge on the merit system when reviewing teacher performance. GREAT - IT"S ABOUT TIME.

  • BIlzac Jul 22, 2013

    It is instead a guarantee that you cannot be summarily dismissed in the middle of a school year unless you have broken one of 15 standards of conduct, including everything from poor performance to poor moral character or not paying your bills.

    The fact that it is so seldom used is a failing of administrators who are too lazy to use the evaluation system the way it is supposed to be used. North Carolina has the most comprehensive teacher evaluation process I have seen in 17 years of teaching. One area with a poor rating puts you on an action plan for the next year, and if that area does not improve, you can be let go, tenure or not.

    If some administrators tolerate poor teaching, then they should do their jobs better. North Carolina is NOT a union state for teachers. The NCAE is little more than a lobbying organization for teachers here. And I say this because I have worked in a union state, and this is definitely not one.

  • BIlzac Jul 22, 2013

    Would you choose a doctor who was fresh out of medical school to perform a delicate operation? Or would you want an experienced doctor with vast amounts of continuing education to his or her credit?

    How about a lawyer? Or a mechanic for your car? Or carpenter for your home improvement project?

    The U.S. military, considered to be one of the best in the world, operates under a seniority system that emphasizes time in service and keeping your nose clean, at least until higher ranks are reached. Then performance begins to matter. Of course in the military, if one of your troops is choosing to do a poor job, you can simply have them discharged.

    So often those who crow the loudest about the poor quality of our teachers and our schools know very little about either. They are simply regurgitating what they have heard other anti-public education voices say.

    The talk about tenure is a prime example of falsehood in advertising. Tenure is not "a job for life" as so many suggest.

  • georgegray Jul 22, 2013

    "if a teacher is a bad teacher with tenure in NC, they can definitely be fired with just a little bit of documentation.......georgegray

    How many teachers have been fired just in Raleigh and Durham for poor performance in the last five years?" - yankee1

    The point of my comment, had you chosen to read it all, was that bad teachers CAN be fired now as long as administrators take the initiative to show that they are bad teachers. Let's assume you're right and there are all these bad teachers out there and administrators are choosing not to fire them. Doing away with tenure will not change that. However, it will make it easier for administrators to fire the kind of teachers that you probably don't want to get fired -- the ones who refuse to give good grades unless students earn them, the ones who challenge students to think for themselves, i.e. the ones who are often a pain in a principal's neck.

  • Citizen7265 Jul 22, 2013

    ""Why are parents of kids going to private school having their tax money used to support failing public schools??"

    Tell me why are those of us who have no children are paying taxes for any of your children to go to school private or public?"
    Gidder Dun

    Tax payers are not paying for an education for anyone, they are supporting their society and community by providing services for everyone in their society including health departments, roads, water, sewer, etc. They still have fees to pay for these services in spite of the money they pay in taxes. Tax payers support the politicians in their society regardless of whether they like them or not. It is the same with schools. Public schools are a small investment in the future of our society that we may choose to attend or not. If you choose not to, then you spend additional funds to provide the education you want.

  • Dukefan1 Jul 22, 2013

    "the reason why you are only hearing about teachers is because most are now on a two month vacation, they have plenty of time to complain."

    A break that we do NOT get paid for. It's not like we are sitting at the pool and getting paid! I think you are just jealous!

  • mpheels Jul 22, 2013

    "So -- these five days - will they roll, or will we lose them if not used?"

    I skimmed through the full text of the budget to find that answer. The budget says to treat the FY2014 bonus leave the same as the FY2002 leave, so as far as I can tell, this leave will never expire and can be paid out at the end of state service.