The $14 billion budget calls for more money to reward teachers, more money to expandSmart Startto every county, and a strong endorsement for theUNC bond package.
Hunt also identified and redirected $334 million to balance the budget.
Hunt's budget proposal calls for a 3 percent pay raise for state employees -- the average pay raise they received in the '90s. Many state employees marched down to the Capitol to rally for more.
State employees gathered between the legislative building and the Capitol to demonstrate for an 11 percent pay increase.
They say if the state does not start compensating its employees, it risks losing its best and brightest to the private sector.
"I believe that the state should be paying their people equal to any other position that exists in industry. If not, they are losing their people," said Webmaster Ron Still.
Many of the employees earn less than $26,000 a year and took a vacation day to attend the rally in support of better pay and better benefits.
The governor is making one concession toward workers in his budget proposal; his plan would set aside state money to help pay rising health care costs for state employees.
"I understand how they feel and I appreciate them very much. I hope that we can do more in the future," Hunt said.
Hunt also presented the idea of floating a $240 million bond to pay a settlement on the state intangibles tax.
"It isn't just a matter of, would you rather pay it out of recurring money and money you've got right now. The question is, we don't have the money right now to meet our obligations to our children and our schools and to do these other things, and thus I'm recommending that bond approach," Hunt said.
Not everyone was comfortable with the recommendation. Several key Democratic lawmakers have already voiced their opposition to the plan.
"Instead of trying to make real investments, we're just trying to duct tape ourselves together and move to next year with all sorts of hopes based on the ifs of the budget forecast," said policy analyst Kim Cartron.
Hunt says in the coming years, North Carolina will not have to deal with the revenue problems caused this fiscal year by the winter snowstorm andHurricane Floyd.
North Carolina is in the second year of a two-year budget.
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