Local News

State Agencies May Have To Lay Off Employees To Solve Budget Crisis

Posted March 27, 2002

— The budget shortfall for the next budget year in North Carolina could hit $1.2 billion, which is the amount state lawmakers and Gov. Mike Easley have targeted in budget cuts.

The brunt of those targets will fall on state agencies that provide vital services. The following are agencies or services where the budget cuts could come:

  • Department of Education at $695 million
  • Department of Health and Human Services at $330 million
  • Department of Natural and Economic Resources at $30 million
  • Department of Justice and Public Safety at $125 million
  • General Government at $20 million
  • All of these agencies are under the governor's control. While state lawmakers want to start with eliminating 2,600 vacant positions, Easley is putting state employees on notice that that the budget cuts may result in some layoffs.

    The governor's office notified state employees in mailings and through department secretaries. WRAL obtained a copy of the letter from Department of Health and Human Services Secretary Carmen Hooker Odom that says:

    "In identifying options of the magnitude required, I have had to include the elimination of positions. Many of these are vacant, but some are currently filled. Unless the economy improves dramatically and quickly, it will be impossible to avoid layoffs next year."

    Proposals submitted to Easley show a budget scenario that may require state agencies to slash their spending by 11 percent. The Easley administration released the agency proposals Wednesday, a week after the Raleigh News & Observer of Raleigh had sued to obtain the documents.

    The state Department of Public Instruction cut 25 vacant jobs last year. Fifteen additional jobs will not be filled this year. Easley has said that he wants to preserve classroom services as educators look to slice the budget, but state lawmakers said that leaves everything on the table.

    The state wants to lower the class size of kindergarteners next year from 19 students to 18. The proposed change would save up to $27 million.

    The General Assembly will also determine whether teachers get a state raise this year, but the Department of Public Instruction plans to protect the $375 to $1,500 each teacher receives for ABCs awards.

    The state has already cut a full kindergarten breakfast program, saving $3 million. Free and reduced lunch students will still remain in the program. The Department of Public Education will work with local schools to find $40 million more in cuts.

    State Rep. David Redwine, D-Brunswick, claims revenue projections for the new fiscal year beginning July 1 "are certainly not good." Redwine and other top budget writers are meeting two months ahead of schedule to try to figure out how to fix a bad budget that is getting worse.

    "First, make sure that the awareness is there that we do have a problem need and to get our arms around it and our hands involved in it," Redwine said.

    This year, the state had to cope with a $1 billion shortfall. State Sen. Howard Lee, D-Orange, described the future budget predictions as dismal.

    "Well, it's hard to tell what the exact number is. We know it's beyond the $1.2 billion level," he said.

    After declaring a budget emergency in February, Gov. Mike Easley ordered 7 percent cuts in state agencies. He has also withheld payments to local governments and the state retirement fund.

    The full Legislature is scheduled to meet May 28.

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