Local Politics

Perdue meets with lawmakers to discuss budget back-up plan

Posted June 15, 2010 4:53 p.m. EDT
Updated June 15, 2010 7:05 p.m. EDT

— Gov. Bev Perdue met with legislators on Tuesday to discuss a back-up plan for the state budget if federal stimulus funds don’t materialize.

Last month, the U.S. House passed a jobs bill that deleted $24 billion in support for cash-strapped states. North Carolina lawmakers had planned to use the money to plug holes in the Department of Health and Human Services after taking money from programs there to spend elsewhere.

Without those federal dollars, North Carolina's budget shortfall jumps to $1.2 billion dollars and could cause thousands of jobs to be eliminated, Perdue said.

By law, the state must approve a budget for the 2010-11 fiscal year by June 30.

“We know that’s looming and it’s something we’re going to have to handle,” House Majority Leader Hugh Holliman, D-Davidson, said.

Perdue asked state lawmakers to plan for the chance that Congress does not provide further help to the states.

Perdue said budget writers need to “lay out the plan to do the cuts it will take to make sure North Carolina’s budget is balanced.”

House and Senate leaders said they are counting on the funds for now, but won't pass a budget that includes those funds if they're not in hand.

“I would pass a budget and say, ‘If we get the money this is what we’ll do with it. These are the spending items that will go with it,’” said Linda Garrou, D-Forsyth, a senior budget writer in the North Carolina Senate.

Garrou believes the painful cuts should be made on the front end.

“We’re on the same page with that and we hope we don’t have to make those cuts because they will be deep cuts,” Holliman said.

Holliman believes they should pass a budget based on money in hand.

“It’s incumbent upon us to make sure our budget is realistic,” he said. “We’ll make a decision based on the facts as we know it.”

Democrats in the U.S. Senate are working to put the funds back in the federal bill. A vote could be held on Wednesday. If passed, it goes back to the House.