2018 Fiscal Year State Budget, NC Budget and Tax Center

Final budget fails to strengthen the foundation of North Carolina’s public schools

The final budget that lawmakers have proposed fails to strengthen the foundation of North Carolina’s public schools. While the public schools area of the budget seems to have a lot going on – one could argue that a lot of special pet projects made it into the final budget – the reality is that little is achieved in ensuring that every student receives a high quality education, regardless of where they live in the state. Consequently, educators will embark upon the upcoming school year with the familiar challenge of doing more with fewer and inadequate resources.

Here are some highlights of the public schools budget that reflects the austerity budget approach state leaders continue to pursue despite an improving economy.

  • Additional state funding teacher and school personnel pay increases represents the bulk of new spending in the budget, a total of $204 million for fiscal year 2018. Beyond this funding, lawmakers do little to move the needle forward in boosting resources available to schools in other areas of the public schools budget. Total spending for public schools for fiscal year 2018 will be only 1.82 percent above 2008 pre-recession spending when excluding the funding for teacher and school personnel pay increases that is included in the budget.
  • The budget includes $11.2 million in one-time funding for textbooks and digital learning materials. Under the final budget, for fiscal year 2018, state funding per student for textbooks and digital resources is 49 percent below peak 2010 level when adjusted for inflation.
  • The final budget foregoes boosting investments in the classroom beyond funding included for teacher pay increases. State funding for classroom materials and instructional supplies, for example, is around half its peak 2009 investment level when adjusted for inflation. Furthermore, the budget does not include any of the $293 million needed by schools to meet the state-mandated class size reduction requirements – creating an unfunded mandate that passes the buck down to local communities.
  • The budget continues to cut state funding for the Department of Public Instruction (DPI) – a $3.2 million cut for fiscal year 2018 and another $4 million the following year. A total of 10 vacant and filled DPI positions are eliminated under the budget, even as the department is charged with more responsibilities.
  • It increases reliance on lottery dollars to fund public education services. The budget replaces $11.6 million of state funding with the equivalent amount of lottery dollars for non-instructional support – this area of the public schools budget would now be solely funded with lottery dollars. The budget also makes a largely one-time cut of $43.3 million in state funding for transportation services and replaces it with lottery dollars.
  • The budget increases state funding for a private voucher program (Opportunity Scholarships) by $20 million for fiscal year 2018 and an additional $10 million the following year. State funding is also included, in another section of the final budget, to establish an NC Personal Education Savings Account Program that will provide scholarship grants for education services to eligible children with disabilities. Both these programs divert limited state funding available for traditional public schools.

Lawmakers’ appetite for more and more tax cuts comes at the expense of ensuring that public schools have adequate resources to provide a high quality education to all students, regardless of where they live in the state. The final budget includes more tax cuts that largely benefit the wealthy and profitable corporations, reducing available revenue by nearly $530 million over the next two years. This budget is a reflection of how little lawmakers prioritize the education of our students, and consequently a tale of under-investing in the state’s future.

Cedric D. Johnson is a Public Policy Analyst for the Budget & Tax Center, a project of the North Carolina Justice Center.

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