Local Politics

Gov. Perdue to sign $19B state budget

Posted August 4, 2009

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— The House and Senate gave tentative approval Tuesday to the $19 billion spending plan crafted in recent days, and Gov. Beverly Perdue said she plans to sign the budget into law after Wednesday's final vote.

State lawmakers give preliminary OK to $19B budget Lawmakers give preliminary OK to budget

The budget was due July 1, but differences over spending priorities, where to cut and how to raise new revenue to erase a projected $4.6 billion deficit created an impasse between the House and Senate.

The two sides negotiated on and off for weeks before agreeing to a tax plan last Thursday – an earlier version collapsed after Perdue objected to it – and then to spending decisions on Friday.

Copy machines churned out copies of the 300-page state budget proposal Tuesday morning to give lawmakers a chance to look through it before it was brought to the floor for a vote.

The Senate quickly approved the measure by a 27-17 vote. The House followed suit late Tuesday afternoon with a 65-52 vote.

Perdue said late Tuesday that she expects to sign the spending plan but will do so with "serious reservations.” She also said that lawmakers had "gone as far as they are willing to go."

Governor Beverly Perdue holds news conference on state budget Perdue holds news conference on state budget

Perdue expressed concern over cuts to mental health services, not enough funds for public safety and no additional monetary help for working families, such as an increase in the earned income tax credit.

"We know this has consequences for people who need services and the people who are state employees," House Speaker Joe Hackney said.

"The kind of things we've done in this budget, I think, protects the very essence of North Carolina. It will allow us to move forward as times improve," Senate Majority Leader Tony Rand said.

Republican leaders quickly panned the proposal.

"If a baby is unloved this bad, it should be put up for adoption," House Minority Leader Paul Stam said.

Sen. Bob Rucho, R-Mecklenburg, said the state is quickly becoming known as "North Taxolina."

The budget proposal includes a one-cent increase in the state sales tax rate, raising it to 7.75 cents in most locations. It also would impose a 2 to 3 percent surcharge on the income tax liability owed by individuals with a state taxable income of $60,000 or more and couples with a state taxable income of $100,000 or more.

"This is a tax on (people's) tax liability," Senate Minority Leader Phil Berger said. "I had someone come up to me and say, 'Well, I guess they've run out of other things to tax that now they're taxing taxes.'"

Perdue said late Tuesday that a one-cent sales tax hike was better than raising income taxes across-the-board for working families.

Taxes on tobacco and alcohol also would be raised, and the state would claim a bigger share of alcohol taxes, holding onto some money previously distributed to municipalities.

On the spending side, lawmakers agreed to preserve class sizes in kindergarten through the third grade. Districts will have flexibility in reducing spending, but the budget directs schools to preserve the classroom as much as possible in grades 4 through 12.

Previous proposals called for increasing the average class size by two to three students, which would have eliminated thousands of teaching jobs.

“This is one of the most challenging budget years on record in North Carolina, and I want to applaud Gov. Bev Perdue and the General Assembly for their efforts to protect public school classrooms and to maximize educational opportunity,” state Board of Education Chairman Bill Harrison said late Tuesday in a statement.

Lawmakers also managed to spare state workers from another pay cut or mandatory furloughs. Both measures were used in the spring to balance the 2008-09 budget.

The budget proposal cuts the Department of Health and Human Services budget by 29 percent and cuts education spending by almost 10 percent. About 725 state workers will lose their jobs under the budget, and another 1,318 vacant positions will be eliminated.

"There is no pork in this budget for those of you who worry about such things," Hackney said.

"We made cuts in our budget, but we tried to protect education, health care, job creation and public safety. The process has been hard. We made some tough choices," said. Sen. Linda Garrou, D-Forsyth.

Hackney shot back at GOP critics, saying simply cutting everything wouldn't have been a prudent approach to balancing the budget.

"They are not up to governing in a recession, when decisions are hard and when things get tough," he said.

157 Comments

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  • Chevelle Mackaroy Aug 5, 2009

    I wish the they would raise everyones taxes even more than they are proposing at the local, state and federal level. Maybe then the teachers can make $150,000 a year while having a class size of 10 students.

  • pbjbeach Aug 5, 2009

    MACKOII

    thanks for the post to explain your eariler coment mangament just doesn't like people that have got the guts to stand up to them an their crooked dealings as thing have been taking place within the ncdot with regards to contracting procdures an the enforcement of the ncdot state specificiations. you mention what happened to one of your reletives way back when well what about what happened to the state employee with the feery' s division down in carrette county based on what i read in the N& O i will never personnely believe that it was sucide as they have said it was . for he to was a whistleblower. i have never wanted to be a whistleblower but when all you get from mangament is the statement of do what you got to do an then the employee actual takes them at their word an does what he has to do asa stated then mangament gets all pis--y an want to punish you the employee for just telling the truth an actually trying to do your job as it is stated to be done thank you

  • dohicky Aug 5, 2009

    to xxxxxxxxxxxxx. The difference in state/government workers is that all the other workers pay their salary and when there are less and less other workers, well you figure it out. Also, other workers are getting pay cuts, benefit cuts and the work hour cuts.

  • diesel Aug 5, 2009

    They need to get rid of everyone of them in raleigh and all of the district reps and congressmen.

  • xxxxxxxxxxxxx Aug 5, 2009

    "Reducing state employee pay is off limits, but reducing the disposable incomes of middle-class families by 3% a year during a recession is perfectly acceptable..."

    News flash - state employees ARE middle-class families. Do you think we're some sort of abstract separate species?

    "Asking families to surrender another 3% of shrinking personal income during a recession to bolster state employee payrolls is outrageous!"

    State employee payrolls are hardly being "bolstered." Hundreds of state employees are losing their jobs and the rest of us have already been told that we won't see a raise again for YEARS.

    ""Well, they have already cut state employees salaries retroactively." not exactly - if they had done it retroactively, the teachers would have had to give money BACK to NC."

    Well, actually, we DID give money back. They took a percentage of our 12 month ANNUAL salary back from us over our last two paychecks.

  • Art216 Aug 5, 2009

    Bake Sale?

  • Here kitty kitty Aug 5, 2009

    WHY ARE WE HAVING TAX FREE WEEKEND???

  • NCPACKER Aug 5, 2009

    I'd feel pretty safe to say that if the politicians would let us review their expense reports that we could just trim those down and not even have to raise taxes. Again, government getting bigger and dumber instead of wising up and controlling costs.

    It sound that BeV Perdue is VERY disliked in NC. Jeez, she's just got into office and look at the dissatisfaction with her. She needs out of there. Where I work incompetent people get fired. Why doesn't she?

  • russellanddiane Aug 5, 2009

    time4real wrote:
    come on you Neal Boring Boortz supporters, let's hear more about the Boortz tax plan that will NEVER HAPPEN! Rich boy will have to pay more and he'll get over it or hopefully move over seas!
    ++++++++++++++++++++++++++++

    Are you for real?! Yeah that's a great idea, have the top 5% of wage earners move overseas and not pay any US taxes. The top 5 percent pay well over half the income taxes. Meanwhile, the bottom 50 percent—those below the median income level—now earn 13 percent of the income but pay just 3% of the taxes. Just imagine what kind of cuts you'd see if tax revenue dropped by over 50%. You should be much nicer to the folks who really pay taxes in this country and not just think their your piggybank.

    Libs are just brillant!

  • time4real Aug 5, 2009

    ncmidteacher,
    i'm down and SO happy to hear at least 16 of you had a clue and didn't listen to the NCAE! Those blind liars should be kicked out of THEIR office!

    As for state waivers, don't count on them continuing to get a free pass there, I hope and pray they say, nope, gotta figure out another way. will they EVER figure out how many millions they'd save if all the buses stopped refueling and running! Again, nope, admin, Chuck, Del and this school board are TOO STUPID! I feel for you teachers because no matter how bad i needed a check I would've walked long ago. Your hearts, most of you, are in the right place, but reality dictates that it's time for an uprising from you all!

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