NC Budget and Tax Center

New report: Reliance on piecemeal budgeting is harming NC

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A new report from N.C. Budget & Tax Center analysts Leila Pedersen and Suzy Khachaturyan (“No final budget, no accountability: Piecemeal budgeting neglects community priorities”) offers a scathing assessment of the General Assembly’s failure to pass an adequate and timely state budget.

This is from the introduction:

Budgets are moral documents. So what values are reflected when the state fails to pass a budget? For the first time in recent history, North Carolina has failed to pass a comprehensive budget. Because the General Assembly refused to adequately fund health and education, North Carolina broke the state budget up into dozens of “mini-budgets,” at least 20 of which have been signed into law (see Appendix). This piecemeal approach caused many pressing priorities to slip through the cracks, leaving working families to pick up the pieces.

State budgets set priorities for how to spend our collective tax dollars. Decisions about how to invest public dollars determine who has access to the goods and services people need to live healthy, productive lives. Since 2013, North Carolina’s self-imposed tax cuts for big corporations and wealthy individuals have slashed revenues, causing communities to fight over smaller pieces of a shrinking pie. The General Assembly’s scarcity mindset has resulted in inadequate funding for many communities’ most pressing needs. With a fairer tax code, North Carolina could adequately fund Medicaid and teacher pay — the very issues that resulted in the 2019 budget veto.

Presently, piecemeal spending decisions largely neglect the needs of communities without wealth and access. Annual budgets provide clarity about state priorities. A piecemeal approach to budgeting fails to provide the certainty that agencies need to be effective, the direction local governments need to plan sustainably, and the opportunity to hold lawmakers accountable to the people they were elected to serve.

The report goes on to present damning details of how the 2019 budget failure is harming three vital areas in particular: public schools, health care, childcare assistance. It concludes this way:

North Carolina cannot let the dangerous precedent of piecemeal budgeting become the new normal. For a state budget to reflect the values of all communities, it must be clear, comprehensive, and transparent. We need to hold our lawmakers to account by urging them to put the public interest ahead of partisan power struggles. In 2020, lawmakers should prioritize:

  • Investing in public schools, specifically school construction, teacher pay, and closing the achievement gap in light of the Leandro report.
  • Increasing access to health care by fully funding Medicaid expansion and closing the coverage gap.
  • Expanding child-care assistance to families without accessible, affordable, quality options.
  • Building affordable housing stock by streamlining funding streams and targeting additional resources to communities at risk of displacement.
  • Protecting our environment by ensuring all communities have the resources they need to keep the air and water clean for current and future generations.

Without a comprehensive budget, it is even more important that we hold our lawmakers accountable. The best way to ensure that state legislators put the public interest ahead of private interests is to ground policy solutions in community needs. Public investments in education, child care, health, housing, and the environment are the stepping stones toward a more equitable and prosperous North Carolina.

Click here to read the full report.

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