NC Budget and Tax Center

We still don’t know exactly what kind of tax and budget deal will emerge from the legislature when it wraps up business in the coming weeks, but it will likely include another round of tax cuts for large multi-state corporations. We’ve also seen an alarming push to bake further tax reductions and spending limits into the state constitution, called TABOR, which would constitutionally mandate policy that we’ve never even tested through regular legislation, and which has been a proven failure in Colorado. Against this backdrop, remember that there is no evidence that tax cuts can solve the economic challenges that we face.

Tax cuts have not improved North Carolina wages. Now that we have recovered from the worst of the Great Recession, many economists see a lack of wage growth our most pressing economic challenge. Wages in North Carolina are even more stagnate than for the US as a whole, a problem that has not been solved by tax cuts over the last few years. The average hourly wage in North Carolina is now roughly $3 less than the national average, a gap that has actually widened since the first major round of recent tax cuts passed in 2013. Tax cuts have not solved our wage problem, and there’s no reason to expect that change.

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Commentary, News

ff-825b1. Disappointing news about a budget that’s almost two months late

The news this week that legislative leaders will miss another deadline in their efforts to pass a two-year state budget that is now eight weeks overdue didn’t come as much of a surprise even though it’s disappointing and inexcusable.

Schools began Monday across the state with local education officials still unsure how many teachers and teacher assistants they will have funding for this year.

Legislative leaders keep claiming that the continuing resolutions they have passed to keep government operating fully funds school personnel while the negotiations on a final budget drag on.

That’s little consolation to schools that might find out in a few weeks that they are losing funding for many of their teacher assistants who are now busy driving school buses and helping first-graders read.

And it is not even true. [Continue Reading…]

LW-824-Forest2. Fact checking Lt. Gov. Dan Forest on GOP education spending

Lt. Gov. Dan Forest released a video last week portraying the GOP as defenders of public education who have used the past four years of Republican control of the state to pull education up from from the bottom of the barrel.

Asking anyone who cares about education to share his ‘Fast Facts’ video when they hear people making comments about the Governor and the General Assembly cutting education spending and not caring about teachers, Forest asserts that it’s the GOP who is responsible for catching the state back up on education spending, unlocking frozen teacher salaries and moving forward with proposals to bring spending levels on textbooks back up from next to nothing. [Continue Reading…]

SM-TH-redistricting3. Redistricting redux: Round three opens at the Supreme Court

It took nearly a decade for North Carolina’s 2001 redistricting plan to wind its way through the courts, resolved finally in 2009, just in time for the next census.

The plans signed into law in 2011 don’t look to be faring much better, as the parties in the legal challenge head back to state Supreme Court on Monday for a third time, this time on remand from the U.S. Supreme Court.

The question for the justices now is whether the 2011 plan survives constitutional scrutiny under the high court’s recent decision in Alabama Legislative Black Caucus v. Alabama, in which the justices held that lawmakers should not apply mechanical racial formulas when drawing voting lines.

For the parties challenging North Carolina’s 2011 plan, the court battle has been a bit like pushing a rock up a hill. Nearly every effort at relief from the state’s highest court has been rejected. [Continue Reading…]

Fennebresque-807A-4004. As UNC system looks for new leaders, more information coming out about Tom Ross dismissal

As a slate of appointed leaders get closer to appointing a new head of North Carolina’s higher education system, details continue to trickle out about the January decision to get rid of its current president, Tom Ross.

John Fennebresque, the chair of the University of North Carolina’s Board of Governors was adamant during a January press conference following Ross’ renegotiated contract that the move to dismiss Ross had nothing to do with politics or Ross’ performance.

He continues to say that state political leaders had no role in the decision.

“I didn’t talk to anybody, other than a few members of the board, and very few,” Fennebresque said in a recent interview with N.C. Policy Watch. “I didn’t want to get into it, for Tom’s sake.”[Continue Reading…] A growing national movement comes to a key battleground state
NAACP “Journey for Justice” to make timely arrival in North Carolina this weekend

In case you hadn’t noticed, something new and important is afoot in the country. It’s often messy and unscripted and at times downright disorganized, but it’s also genuine, born of the grassroots, brimming with potential and very likely to be around for a while.

The subject, of course, is the newly energized civil rights movement that is fast emerging across post-Ferguson America. Spurred initially by the power of modern technology and, in particular, the ability of smartphones to document the terror that so many people rightfully and tragically experience with respect to the law enforcement officers who are sworn to serve and protect them, the movement is fast branching out to merge with other extant social justice causes like the fight for living wages, voting rights and the effort to save public education. [Continue Reading…]


It’s certainly not the highest-profile issue, but the new $21.74 billion state budget (whenever it does get passed) could usher in a new approach to higher education in the state.

Earlier House and Senate versions of the budget endorsed giving Western Governors University, an online-based higher education system, a bigger footprint in the state, and one propped up with taxpayer money.

At this point, there are more questions than answers about what will end up in the final state budget, with House and Senate lawmakers now two months behind issuing a budget for the next two years.


WGU headquarters in Utah

Western Governors University, or WGU, is a non-profit online college, started in 1995 by a bipartisan group of governors in the western part of the country. It specializes in reaching out to “part-way home” students, those that had taken some college courses but because of life or family choices before obtaining a degree.

(Click here to read a previous article about WGU’s foray into North Carolina.)

It costs students approximately $3,000 for unlimited classes during a 6-month period and uses a competency-based model, where students can get credits for classes if they already know the material and can pass a test showing that.

Here in North Carolina, Gov. Pat McCrory is in favor of bringing WGU to the state, and had a meeting at the Executive Mansion in November with Robert Mendenhall, the CEO of the Utah-based University.

In their proposal, House members suggested letting students attending WGU to tap into a $90 million pool of state money used for need-based aid to students attending private colleges in the state.

The Senate took a different approach, and would give the Utah-based college $2 million in state money to set up shop here, with the possibility of drawing down $5 million more if private funds are also raised.

As expected, WGU has both proponents and critics.

It’s hailed by supporters as a fairly low-cost way for older students who may be busy working to finish their degrees, while critics say it offers an inferior education and undermines existing offerings at universities and community colleges.

The $6,000 annual cost for a year at WGU is much lower than what for-profit online colleges like the University of Phoenix and Strayer University can cost.

But it is on par, or close to what UNC system institutions charged this year in tuition and fees, which range from $4,655 a year at Elizabeth City State University to $8,407 at N.C. State University for the 2015-16 school year.

WGU currently has a six-year graduation rate of 38 percent, a rate they hope to increase, which is much lower than the 63.1 percent that graduate from UNC institutions in six years.

Not everyone’s thrilled at the prospect of WGU coming to the state.

John Fennebresque, the chair of the University of North Carolina’s Board of Governors, says the state’s existing higher education institutions can do more for North Carolina-based students than WGU can.

He attended the November meeting McCrory had with WGU in November.

“We can do all that within the (UNC) system,” Fennebresque said in an interview this week with N.C. Policy Watch. He added, “I saw nothing that they offer that we don’t or can’t do.”


taborThe latest warning about the proposed Taxpayer Bill of Rights comes from the editorial board of the Fayetteville Observer.

Editors warn in Friday’s paper that the proposed constitutional amendment (that must still pass the House) might sound alluring, but would have many unintended consequences:

The concept is a lot like mandatory sentencing, which took away judges’ discretion, resulted in overcrowded jails and took away opportunities to rehabilitate offenders before they became career criminals. The concept ignored unintended consequences, which have been costly.

There is similar naivete at work in the Taxpayer Bill of Rights. State Treasurer Janet Cowell says the measure could imperil North Carolina’s triple-A bond rating and boost the cost of borrowing.

But the fallout could be much worse than that. For hints, we can look at Colorado, whose voters approved a similar amendment more than two decades ago.

An official of the Colorado Fiscal Institute says his state has found the bill of rights to be “a complete and unmitigated disaster.” Tim Hoover told the Public News Service that “The only good news to come out of it is that Colorado has served as an example of what not to do.” One of the biggest problems there has been with education funding. The tax-increase limits have led to a decrease in per-pupil spending in education and dropped the state to 50th in spending on higher education. Doesn’t North Carolina already have enough problems with education funding?

Like many across-the-board spending limits (federal budget sequestration comes to mind), the formula in the bill of rights is simplistic and inflexible. It considers average population growth, but doesn’t consider growth in segments of the population, like children or the elderly, that might have more costly needs.

What we really need to do is let our lawmakers do the jobs we pay them to do – to run the state effectively and efficiently, and to appropriate what it takes to get it done. They stand for a performance review every two years and that’s where we should make decisions about their spending plans.

The full editorial can be read here.


This morning’s North Carolina news media “must read” comes from Greensboro News & Record  columnist Susan Ladd. In her column, Ladd explains exactly why the latest manufactured smear campaign against Planned Parenthood is just that:

“Because of its nationwide network of providers, Planned Parenthood is the largest provider of abortion services in the country, but abortions amount to only 3 percent of the health services this group provides.

The most recent attacks on Planned Parenthood were videos purporting to show the group’s ‘procuring baby parts for profit.’

The Center for Medical Progress, which shot these heavily edited undercover videos, is not a medical organization but a political one, founded to create inflammatory ‘sting’ videos of Planned Parenthood.

David Daleiden, the project leader for the videos has a history of creating deceptively edited videos. One of CMP’s board members is Operation Rescue President Troy Newman, who in 2003, called the murder of an abortion doctor “a justifiable defensive action.”

Abortion rights groups and some U.S. senators are asking that CMP be investigated for false representation and misleading the IRS when it applied for tax-exempt status….

But the smear campaign hasn’t abated. CMP continues to release more of its videos, and politicians continue to site them over and over in trying to sway opinion and public policy.

I’m sad to say that some of our local elected officials, including U.S. Rep. Mark Walker (R-Guilford) and Senators Thom Tillis (R-NC) and Richard Burr (R-NC) are among them.

Unfortunately, a lie repeated often enough still will persuade some of the people — especially those who want to believe it. And the truth, determined over time by impartial investigations, never has the shock value or leaves quite as much of an impression as those sensational videos.”

Fortunately, the lies aren’t achieving their intended objective -harming Planned Parenthood. As Ladd notes:

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