2015 Fiscal Year State Budget, Falling Behind in NC, NC Budget and Tax Center

This week the Budget & Tax Center released a new report on North Carolina’s 2015 fiscal year budget. While other states across the country are beginning to reverse the worst cuts made during the Great Recession, North Carolina continues to underfund crucial public investments in order to pay for tax cuts that took effect this year. Lawmakers failed to provide a high-quality education for all children, protect natural resources, support community-based economic development, or provide adequate health and human services to North Carolina residents.

Under the final budget, state investments are 6.6 percent below pre-recession levels five years into the official economic recovery. The new budget for the 2015 fiscal year is the 7th budget enacted since the Great Recession hit, and North Carolina has yet to bounce back to its pre-recession investment level. This is in contrast to spending during previous economic recoveries – spending did not dip after the 1981 and 2001 recoveries and state lawmakers restored investments to the levels that were in place when the 1990 recession hit within three years. Read More

2015 Fiscal Year State Budget, NC Budget and Tax Center

The final budget for fiscal year 2015 – which runs from July 2014 through June 2015 – includes a pay raise for public school teachers for the first time in several years. What the pay raise translates into regarding additional dollars in teachers’ paychecks is unclear based on differing comments by the governor and state lawmakers. Whereas Governor McCrory proclaims an average pay increase of 5.5 percent for teachers, state lawmakers tout a 7 percent average pay raise.

Beyond the on average presentation of the teacher pay raise by state policymakers, the amount of additional money teachers will see in their paychecks varies greatly – particularly among early-career teachers compared to more experienced teachers.

Not all teachers are provided a long-awaited, meaningful pay increase under the new teacher pay structure. The new six-step pay structure for teachers included in the final budget replaces the existing 36-step pay scale – these steps are based on years of teaching experience and determine when a teacher gets a pay increase. Reducing 36 steps down to six entailed much maneuvering by state lawmakers, resulting in some teachers getting a boost in pay at the expense of other teachers.

Under the new pay scale, the starting pay for early-career teachers jumps to at least $33,000 from $30,800 under the old pay schedule—a 7.1 percent increase. However, salary increases for more experienced educators are much lower. In fact, some teacher would actually earn less under the new pay scale compared to the old pay scale; these teachers will continue to earn salaries based on the old pay scale for the 2013-14 school year along with a flat annual $1,000 bonus. Read More

2015 Fiscal Year State Budget, NC Budget and Tax Center

Each year public schools across the state experience changes in their student enrollment levels – some see an increase, others a decline, while enrollment in some schools remain steady. A policy change included in the budget approved by state lawmakers for the current fiscal year 2015 means schools experiencing growth in student enrollment are no longer guaranteed to receive full state funding for the additional students when state lawmakers create a budget for the next school year.

The new provision in the budget no longer includes enrollment adjustments for public schools as part of the baseline budget, also referred to as the continuation budget. Prior to this policy change the state’s budgeting process took enrollment adjustments into account when determining how much state funding is required to maintain education service levels. Doing so more accurately reflect the actual level of state funding that should be invested in K-12 education.

Public schools that experience an increase in student enrollment from one year to the next must now wait until state lawmakers finalize a budget for the next fiscal year to know if enrollment growth is fully funded. Many public schools across the state could potentially feel the impact of this deceptively subtle policy change. Read More

Falling Behind in NC, NC Budget and Tax Center

As North Carolina continues to recover from the Great Recession, most of the jobs that have been added pay low wages, making affording even basic necessities difficult for many hard-working North Carolinians. Raising the state minimum wage and reinstating a state Earned Income Tax Credit (EITC) are two policy tools that North Carolina state lawmakers can use to help boost wages, widen the path out of poverty, and reduce income inequality, a report released this week by the Center on Budget and Policy Priorities (CBPP) highlights.

Wages for the least paid workers are no higher than they were 40 years ago, the CBPP report highlights. Yet evidence shows that lifting the income of families earning low wages provides a range of benefits, including improved learning and educational attainment and higher future earnings in adulthood for low-income young children. Furthermore, raising the minimum wage and an enhanced state EITC together works to put families and individuals on a path to financial stability and self-sufficiency. Read More

Back to School Series, NC Budget and Tax Center

This is part of a Back to School blog series that highlight various issues to be aware of as the 2014-15 school year kicks off. (See Part 1, Part 2, Part 3, and Part 4)

Little things can make big differences in children’s lives. Something as simple as arriving to class with food in your stomach can enhance a child’s learning experience. Many schools across North Carolina recognize this and are offering breakfast and lunch to all of their students at no charge this school year.

As part of the nationwide Community Eligibility Program (CEP), high-poverty schools in at least 36 school systems across North Carolina will provide breakfast and lunch to all students free of charge. This effort not only aims to help end childhood hunger – one in five American schoolchildren can’t count on getting enough nutritious food at home – but also aims to enhance the classroom experience of students. Ensuring that children show up in classrooms each day fed and ready to learn increases the chances of students being more focused, attentive, and engaged.

The school year marks the first year in which eligible schools nationwide can participate in CEP. With all students provided breakfast and lunch free of charge, participating schools are no longer required to collect school meal applications, which reduces administrative costs. These cost savings can now be directed towards covering the cost of the school meals that are provided. Read More