Local News

State's Economic Outlook May Be On Upswing

Posted December 4, 2003 6:03 a.m. EST

— The jolly mood of most holiday shoppers is fueling an improving outlook for North Carolina's state budget. A recently-released fiscal report shows tax revenues stayed strong for three straight months putting the state right on target through November.

Last year, there was nothing but gloom and doom coming out of the state Legislature with a projected $2 billion budget shortfall. This year, there is a lot more cautious optimism.

"I can tell you the worst is over in terms of the state's fiscal crisis. Does that mean all our problems are solved? No," said Dan Gerlach, Gov. Mike Easley's advisor for fiscal affairs.

While Easley's staff points to sound fiscal management for weathering past budget problems, his Republican challengers have stayed relatively silent on the issue.

"I think it's a strategic mistake to be so quiet at this point in the process," GOP political consultant Jack Hawke said.

Hawke said Republicans should be hammering away on recent textile job losses and tax increases.

"It will probably be one of the most important topics because it will be a question about how we have handled our budget," Hawke said.

Since various costs such as pay raises are not included in next year's budget, some experts still project a gap of anywhere from $500 million to $1 billion. They hope to get a better handle on the state's fiscal situation after revenue reports in January and May.