Raleigh, N.C. — With the stroke of a pen, Gov. Mike Easley approved a new budget Tuesday, which includes a $1 billion increase in education spending.

At the budget-signing ceremony, Easley focused on how the new $20 billion spending plan will benefit North Carolina's education system.

“We have put reality behind the vision of an affordable, debt-free education from pre-kindergarten to an undergraduate degree at a state university. Out of this budget, North Carolina emerges a leader in education on the national scene," Easley said. "History will note the courage and foresight of those who did not just make easy promises, but did the hard work to keep those promises and stand up for the future of our state."

The Earn and Learn program, for example, will allow students to take community college courses while still in high school.

"Every child in every corner or every county in North Carolina, regardless of their economic status, can get a college education in North Carolina now," he said. "The best-skilled work force in the United States is going to be found within the borders of North Carolina."

Easley also talked about providing online access for all 405 high school campuses in the state in the coming years.

State lawmakers in both houses gave final approval to the spending plan on Monday. All state employees will receive a 4 percent raise, while teachers and judges will see their pay go up by 5 percent.

The plan makes permanent a temporary 0.25 percent sales tax increase adopted in 2001, raises the tax on cigarettes by 10 percent to fund cancer research at the University of North Carolina at Chapel Hill and gives counties the option to raise sales or land transfer taxes. It will help county governments by providing new tax options and Medicaid relief.

Easley said he was pleased the controversial transfer tax option was approved. He had previously chided lawmakers as being afraid of the real estate lobby, but he said he understood the pressure they faced.

"Anytime you have a special interest spending $1 million in efforts to scare off legislators, they have to fight back, and they're concerned," he said.

Some people in Wake County wanted more Medicaid money in the budget. But Easley said large counties can handle the rising cost of Medicaid, and he wanted the Medicaid concerns addressed in the budget to focus on the state's 85 rural counties.

"This budget expands local government options to deal with growth while relieving low-wealth and other counties of their costly Medicaid burden. It gives our state more weapons to compete successfully in the global economy and to provide a bright future for all our citizens," he said.

With the budget complete, lawmakers have to tackle several other issues, such as a renewable energy bill and a landfill moratorium, before the General Assembly wraps up later this week.

Lawmakers also hope to pass a bill that would make ethics hearings open to the public.