Proposed $22.2B state budget clears NC House

The vote was identical to the tally recorded Wednesday evening when the House gave preliminary approval to the spending plan, which includes raises for teachers and state workers and starts phasing in an increase to the standard deduction on state income tax returns.

Although House Minority Leader Larry Hall opposed the budget, he urged the Republican House majority to fight for more when negotiating a final budget with the Senate, noting that several House priorities in previous years have been removed by the time a final budget was approved.

"If we keep repeating what we've done in the past, we'll keep getting what we've been getting, which is rolled," said Hall, D-Durham. "I'm challenging you to do better and to stand up to the Senate and ensure we have the proper investments in our future."

The budget provides an average 4 percent raise for teachers, with the largest increases provided for those in the middle of their careers. Lawmakers have focused the past two years on raising the salaries of beginning teachers.

Other state workers would receive an average 2 percent raise in the House budget, although some targeted groups would see bigger bumps to help agencies recruit and retain the best people. State retirees would receive a 1.6 percent cost-of-living adjustment.

House and Senate leaders set the $22.225 billion spending limit for the budget weeks ago, and some Democrats criticized that as an arbitrary cap, noting that it leaves $128 million on the bottom line.

"As members of this body, we should focus on efficiency in government, effectiveness of government programs and providing for the needs of our state," said Rep. Darren Jackson, D-Wake. "Agreeing to a number that you're going to spend before even discussing what those needs are, in my opinion, is not responsible governing."

Rep. Paul Luebke, D-Durham, said the budget should have devoted more money to higher salaries for both teachers and state workers instead of continuing to cut taxes.

The House budget calls for a $2,000 increase in the standard deduction for couples filing jointly, phased in at $500 a year over four years, and a $1,000 increase for single filers, phased in at $250 a year during that same period. Senate leaders say they want a two-year phase-in of the increase.

"You cannot have a budget without taxes," said Luebke. "We're taking off the table a lot of potential revenue to meet the needs of the state."

Rep. Susan Fisher, D-Buncombe, blamed 2013 tax cuts that largely benefited the wealthy for constraining current spending, and said the additional cuts will exacerbate the problem while doing little to help lower-income people.

"This appears to me to be nothing more than an election year band-aid on a state that has lost economic development opportunities, and seen teachers and state employees fall further and further behind in their ability to make ends meet," Fisher said, "even students using old, out-of-date textbooks – sharing them in fact, not even being able to take them home. I submit to you that North Carolina can do better than this."

But Republican leaders credited their tax cut program for the state's economic recovery.

"The tax policies that so many members of the Finance committee and others have been working on have been successful. Our revenues are growing," said Rep. Nelson Dollar, R-Wake.

Dollar, the chief budget writer in the House, responded that the budget invests in various areas to help the state economy grow and that the spending limit had no effect.

"We are utilizing every dollar of recurring money that is available to us," Dollar said. "The spending cap was no impediment whatsoever to being able to do what we could do this year with respect to salaries."