McCrory to focus on economy, education, efficiency

In his first State of the State address, McCrory said North Carolina cannot rest on its laurels as an education pioneer and economic powerhouse, noting many other states – and some foreign countries – have caught up and passed the state. He called on everyone to put aside partisan differences and pull together for the good of the state.

"None of this can be about politics, power, legacy, turf or who gets the credit. Who cares?" he said. "This is about the people of North Carolina."

Tax reform, which has been widely discussed among lawmakers in recent months, is just one tool "to make the economy ignite again," McCrory said, but it was the first avenue he mentioned as he turned his speech toward what he calls North Carolina's "broken economy."

Some Republican lawmakers have suggested eliminating personal and corporate income taxes and replacing them with an increased sales tax rate that applies to more things, such as services and groceries. McCrory didn't provide details of his tax plan, saying only that he wants lower rates and fewer loopholes and that it must be revenue-neutral.

In addition to tax reform, the governor called for a more aggressive energy plan, noting the royalties from oil and natural gas production could be used to finance infrastructure, education and other needs. He also called for an infrastructure plan to address North Carolina's transportation, communication, water and energy needs.

McCrory said he will work to expand overseas exports of North Carolina products and plans to tweak the incentives the state offers to recruit new and expanding businesses so they reflect measurable results. Also, the Department of Commerce will create a "small-town strategy" to better sell potential employers on rural areas with high unemployment.

"No one, no one will outwork this governor or our team ... in our effort to grow, recruit and retain North Carolina jobs," he said. "We will be on the road, and we're going to sell our great resources that we have."

Citing statistics on North Carolina's dropout rate and the number of students who need remedial help with math or reading, McCrory said the state's public schools are in desperate need of reform.

Schools need to teach "both knowledge and skills" so students are better prepared to fill jobs that are available now and in the future, he said. The "four silos of education" – pre-kindergarten, K-12, community colleges and the University of North Carolina system – need to work together on a strategic plan, he said.

"We can all agree on the importance of improving education because our competitive future depends on it," he said. "We must begin to change the debate on education. Instead of focusing the debate only on the budget, we now must demand results."

McCrory called for increasing technology in the classroom and that the North Carolina Education Lottery should be reformed to pay for it. Lottery administrative and advertising costs could be trimmed to free up money for technology, and school districts should be given the chance to spend some of their lottery proceeds on digital and virtual learning, he said.

"This is the future. Why don't we be ahead of the curve instead of behind the curve," he said.

Even before he took office last month, McCrory repeatedly referred to a "broken" state government that he wanted to fix through a "culture of customer service." He says his administration already has taken a few steps toward that:

But the governor also pulled out a stack of reports filed by the Department of Health and Human Resources to ask lawmakers to ease up on his staff to give them time to reform the state Medicaid program, which has been criticized in two recent audits for overspending and mismanagement.

McCrory said he plans to include money in his budget proposal to repair and upgrade government buildings and to better track the state motor fleet, and he asked lawmakers to pass bills that he believes will improve the productivity of state workers.

"We want to reward our talented state employees, but seat-warmers must be a thing of the past," he said.

McCrory acknowledged that his efforts would step on people's toes, but he said it's not in order to cause pain. North Carolina needs to wake up and get moving so it can regain its economic and education superiority, he said.

"We obviously have a lot of work to do, but my team and I chose to look at these challenges as opportunities," he said. "These are opportunities for every one of us."