McCrory directs budget cuts

Posted June 23, 2014

Gov. Pat McCrory

— As the June 30 budget deadline looms with no legislative deal in the works, Gov. Pat McCrory is instructing state agencies to prepare for what, for many, would be the worst-case scenario.

According to a budget guidance memo sent out Monday from the Office of State Budget and Management, agencies should plan to budget for July as if the lesser amount of funding in either the House or the Senate plans has been put in place.

McCrory makes one exception to that rule: The 7,400 teaching assistants that would be cut under the Senate plan are not being cut.

McCrory spokesman Josh Ellis pointed out that overall, budget spending is up slightly, especially in areas such as the Department of Health and Human Services, so not every area will see less funding. He suggested that larger departments could shift spending to absorb some changes in the short term.

However, agencies are directed to begin the termination process for any state employee whose job would be cut by the House and Senate proposals. 

Teachers and state employees will see no pay increases under the guidance memo.

No expansion items, from additional pre-kindergarten slots to extra money for medical examiners, are to be implemented. 

Each agency would have to adjust overall spending to match the lesser of the two spending plans. While they would not have to take exact line-item cuts proposed by either plan, the dollars will come out on the bottom line. 

The cuts they may have to prepare for include: 

  • The Department of Public Instruction would have to prepare for a funding cut of 30 percent plus 70 fewer school nurses.
  • The University of North Carolina system would see an additional $19.8 million cut. 
  • DHHS would receive less in Medicaid funding - the Senate cut $32 million from coverage for 15,000 aged, blind, disabled and medically needy people. 
  • The Department of Public Safety may need to prepare to close two women's prisons: Fountain in Nash County and North Piedmont in Davidson County.  

House and Senate leaders have been hinting that, should they fail to reach a deal, they could walk away and leave the current budget in place.

McCrory's directive takes it one step further by beginning the process of enacting the lowest number proposed by either chamber, essentially calling their bluff. 

Spokesman Josh Ellis took issue with that characterization, saying it's no different than in any year in which lawmakers don't appear close to a budget deal by the deadline.  

Asked why the governor was instructing agencies to prepare for cuts that haven't yet been approved, Ellis said it's McCrory's job to prepare for the upcoming fiscal year, noting that schools and local governments are trying to plan as well.

The changes are not necessitated by budget constraints, he said, noting the state is beginning the year with a higher unreserved balance than last year. 

"We certainly hope a budget compromise will be reached," Ellis said. "In case an amended budget isn't passed by June 30, we're trying to get the process in place."

Senate leader Phil Berger's spokeswoman, Amy Auth, wouldn't comment on how negotiations are going, except to say that negotiators "must receive the real numbers on Medicaid and the lottery we requested from DHHS and OSBM to move forward on the budget."


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  • Carl Keehn Jun 25, 2014
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    View quoted thread

    In fairness to the Governor, the Governor can only make a recommended budget, one that reflects his priorities. It is the responsibility of the Legislature to craft a working budget, one which may or may not take the Governor's proposed budget into account. In this case, the two houses of the legislature can't agree on which form of their own budget they wish to adopt.

    As North Carolina has a biennial budget, the basic budget was established a year ago. During the off year, the legislature has the opportunity to amend the budget to reflect changing expectations and needs. Technically if they fail to do so, the 2014-16 budget remains in effect. Until they can reach agreement, the Governor and Budget Director are instructing agencies to plan for next year, based on the most limiting of budget proposals, with the idea that when a budget is established it should be better.

  • Phil Larson Jun 24, 2014
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    Too bad he can only direct cuts, what about "action", can he not direct action to help the citizens of NC? Maybe he doesn't have time, after all that could distract him from only helping corporate interest.

  • Alan Baker Jun 24, 2014
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    Perhaps I'm misinformed, but as far as I know the President has remarkably little control over whether the NC General Assembly can manage to pass a budget but it certainly looks like they could use his or some other competent lawmaker's help.

  • Jump1 Jun 24, 2014

    But if you look you will see that NO lawmaker at any level or supervisor took and cut it their pay.

  • mike275132 Jun 24, 2014

    Welcome to Year Five of this Booming Obama Economy !

  • Garry Spears Jun 24, 2014
    user avatar

    McCrory's salary goes up...your salary goes down. You can't explain that.

  • David Collins Jun 24, 2014
    user avatar

    Instead of budget cuts, the legislature should spend and invest more wisely.

  • Thomas Williams Jun 24, 2014
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    Why, what do you want to do, turn the state back over to the Democrats who ran it since the civil war ended, and now you want it fixed in two years?

  • Jun 24, 2014

    Political games. With real citizen's lives at stake. "I want!" "No, I want, you can't have!" "I'm gonna hold my breath till I pass out!" "Oh no you WON'T!" "Oh YES I WILL!". Toss in a few right wing buzzwords like "entitlement, lazy, welfare, immigrants, security, guns, prayer and values" and you've got the recipe for destruction of the middle class.

  • European American Jun 24, 2014

    McCronie only stated what Pope told him to do.