Perdue's tax push comes with political risks

Perdue held two of her "Save Education" rallies in Wilmington and Greenville Monday to press lawmakers to find $1 billion to $1.5 billion in additional revenue for education as they struggle to erase a projected $4.6 budget deficit.

"I've been so troubled by the proposed cuts to public education," Perdue said at her kickoff rally in Raleigh last Wednesday. "We cannot increase class size. We cannot lay off teachers. We will not sacrifice North Carolina's economic future."

Trying to sell tax increases in a down economy is a politically risky proposition for Perdue.

"The governor's clearly in a no-win situation. She's having to spend political capital pushing an idea that the public has question marks about," Democratic political consultant Brad Crone said.

Polls show Perdue's popularity has dropped in recent weeks, Crone said. In addition to her tax push, she also cut the pay for state workers in an effort to balance the 2008-09 budget.

"If you're going to drive the legislature, you've got to have public support and public sentiment behind you," he said.

Crone, who also consults for the Entertainment Group of North Carolina, a coalition of video gaming businesses, has suggested that the legislature repeal the ban on video poker and use the machines as a source of revenue for the state.

The governor also has been criticized because, other than alcohol and tobacco taxes, she hasn't offered specifics on how to raise the money. She said it's up to lawmakers to figure out the best mix of taxes and cuts in the budget.

A Senate plan would tax dozens of services, from lawn care to car repairs, but would lower the state rates on sales and income taxes. Meanwhile, the House budget calls for a quarter-cent increase on the sales tax and higher income taxes on couples making more than $200,000 a year.

"I just think now's not the time to be raising taxes on anyone," said taxpayer Mike Donnelly of Bunn.

Some taxpayers said they would be willing to support upper-income taxes and higher surcharges on tobacco and alcohol.

"I'd just as soon it not be necessary, but there's a funding shortage for all things that make our quality of life better. So it's got to come from somewhere," said taxpayer Ed Spencer of Raleigh.

"(We need to raise) what is needed to support an educational program in North Carolina that the state is going to be proud of," said taxpayer Lindsay Reed of Raleigh.

Even with such support from voters, Crone said, Perdue is fortunate that she doesn't face re-election for another three years.