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. Read more

Environment, Governor Roy Cooper, Legislature

DEQ budget still meager, cuts 16.75 jobs, but includes money for pet projects

“Reorganization Through Reduction”: George Orwell couldn’t have said it better.

The spirit of George Orwell must have been hovering over House and Senate conferees when they drafted the state environmental budget. “Reorganization through Reduction” is the very gentle term budget writers used to tell NC Department of Environmental Quality Secretary Michael Regan to do a very dirty job: Find $1.9 million in savings over two years — somewhere.

Lay off employees, scale back programs, use fewer paper clips, whatever it takes.

At $77 million in the first fiscal year, the DEQ conference budget, unveiled yesterday at 11:10 p.m. by the House and Senate conference committee, is more generous than the Senate version — a low bar, indeed. It is stingier than the House‘s and it falls far short of the $84.8 million appropriation that Gov. Roy Cooper had recommended.

The second fiscal year is even leaner for DEQ, just $76.8 million, after the Reorganization program concludes.

“The budget cuts core functions beyond the bone,” said Grady McCallie, policy director for the NC Conservation Network. “And it will leave our rivers, lakes and drinking water sources exposed to more pollution while threatening the ability of DEQ to adequately inform the public about environmental health risks.”

The DEQ budget also contains a policy report, which also places further fiscal limitations on the agency.  This document includes restrictions on the allocation of Volkswagen Settlement Funds. North Carolina is due $87 million — certainly not chump change — from a federal lawsuit against the car maker because it cheating on its diesel emissions tests. The state can use the money on projects that will reduce air emissions from cars, trucks and trains. But the conference budget requires the General Assembly, not DEQ or the Department of Transportation, to approve distribution of those funds. Lawmakers, undoubtedly, will want some of that money spent directly in their districts on pet projects.

Speaking of pet projects, the budget’s big winners: SePro, the chemical company whose powerful lobbyist Harold Brubaker has convinced lawmakers to spend $1.3 million on a sketchy algae-killing treatment for Jordan Lake. The City of Havelock,  inexplicably jumps to the front of a very long line of needy projects and receives $1 million to “repurpose” the old Phoenix recycling site.

The budget’s semi-winners: Oysters, which will receive $1 million in recurring funds for necessary sanctuaries. Twenty-nine DEQ employees, including Chief Deputy Col. John Nicholson, whose jobs were saved from the Senate guillotine. NC A&T and Appalachian State universities, who can keep $200,000 each for energy research. (Check back on Thursday for a larger story about rearrangements to the state energy office and general provisions to the energy portion of the budget.)

The budget’s losers — and this is just the short list: NC State University’s energy program, whose funding was eliminated. The myriad other ways DEQ touches North Carolinians lives: fortifying coastal communities’ response to climate change, consistently monitoring water quality in the sounds, protecting people — usually low-income and minority neighborhoods — from contamination in old landfills. And the 16-plus DEQ employees, including seven in the vital regional offices, where much of the permitting takes place. They will have to pack their desks if the cuts survive the full House and Senate votes. Not to worry, lawmakers say, it’s only a reorganization.

News

Gov. Cooper: “It may be the most fiscally irresponsible budget I’ve ever seen.”

Gov. Roy Cooper speaks at a press conference Tuesday, expressing disappointment with the budget proposed by legislative leaders.

Gov. Roy Cooper will push for both Democrats and Republicans to vote against the state budget proposed by legislative leaders this week.

“It may be the most fiscally irresponsible budget I’ve ever seen,” Cooper said in a press conference Tuesday.

Cooper said the compromise version of the budget released late Monday was worse than either the House or Senate versions of the budget.

“In comparison, their overall spending is higher than the two budgets but teacher pay is lower than the two budgets,” Cooper said. “That is a demonstration of priorities that are out of line.”

“To put it simply, this budget prioritized tax breaks for the wealthy and corporations and short-changes education and economic development,” Cooper said. “It does pick winners and losers – the wealthy win, but the average middle class family loses. Education loses. Economic development loses. People struggling with opioid abuse lose.”

Cooper said he was surprised and disappointed to see significant funding for combating the opioid problem – something on which there seemed to be bipartisan agreement – left out of the version of the budget released this week.

“It actually makes cuts in mental health, which is going to hurt the fight against opioids,” Cooper said. “So I’m deeply concerned about that.”

Cooper also criticized the tax plan outlined by the budget.

“Under this budget a person earning a million dollars or more per year will get a tax break that is 85 times larger than what a working family gets,” Cooper said. “Think about that for a minute. Eighty-five times larger. The tax plan in this budget will blow a major hole in our budget just a few years down the road, handcuffing our ability to invest in education and the economy, handcuffing our ability to make teacher pay the highest in the Southeast in three years and at least to the national average in five years.”

But the largest problems are with the deficiencies in the budget that will hurt North Carolinians now, Cooper said – including no more money for teachers who pay for materials out of their own pockets and a short-changing of early childhood education.

“And while public schools are in so much need, this budget drains money from the public school system to pay for private school vouchers,” Cooper said.

The governor stopped short of saying he would veto the budget.

“If this budget does pass – I look forward to a strong debate – I’ll let you know as soon as it hits my desk,” Cooper said. “But as you can see right now, I think this budget is wrong for North Carolina.”

News, Tracking the Cuts: The Dismantling of Our Public Schools

N.C.’s compromise budget: Teacher pay raises, voucher boom, DPI cuts, school grading and more

North Carolina state lawmakers unveiled a compromise budget package Monday that bundles a new round of teacher pay raises amid steep cuts for the state’s top K-12 agency and support for school choice favorites like vouchers and education savings accounts.

The $23 billion spending plan is expected to move swiftly through the legislature. State senators are expected to hold the first of two votes on the budget deal Tuesday afternoon, while the House is expected to schedule votes later this week.

Some of the deal’s most controversial provisions are likely to emerge in its public education provisions, which include unpopular reforms to the school performance grading system and rapid expansion of the private school voucher program without the accountability requirements included in the House budget passed last month.

Here’s a round-up of the top public school components of the legislature’s budget deal:

  1. Teacher pay: Includes an average 3.3% raise in first year. In its inclusion of raises for most steps on the salary scale (with the biggest raises bound for teachers on steps 17-24), the plan is closer to the House salary schedule than the Senate’s proposal, which focused its raises on mid-career teachers. GOP budget writers say their goal is to reach average pay of $55,000 by 2020.
  2. Department of Public Instruction (DPI): The compromise plan softens the staggering, 25-percent budget cuts for the state’s K-12 bureaucracy included in the Senate budget, although it retains major reductions for an agency that focuses its intervention and training efforts on low-income and low-performing school districts. The new plan includes 6 percent reductions in the first year (about $3.2 million), followed by a 13.9 percent cut in the second year (about $7.29 million), all while adding 24 new reporting requirements for the agency. This does not include the budget’s plan to chop 11 positions in the agency, including three filled jobs, a loss of another $900,000 or so in funding.
  3. DPI audit: After years of allegations of wasteful spending in DPI, the budget includes $1 million for GOP Superintendent of Public Instruction Mark Johnson to commission an audit of the agency. Interestingly, the second year of the spending plan includes a $1 million DPI cut based on “anticipated savings” from that audit. The spending plan also includes $29 million in non-recurring funds over two years for a “modernization” of DPI financial accounting, a plan GOP lawmakers say will allow for increased transparency in the agency.
  4. School districts’ central offices: In keeping with the legislature’s clear skepticism of K-12 administrators, the budget includes a 7 percent cut to the state’s central office allotment for school districts in the first year, and an 11 percent cut in the second year, both a modest reduction from the Senate’s earlier proposal.
  5. Vouchers: As expected, the legislature retains a $10 million annual expansion of the so-called Opportunity Scholarship Program, which provides public funds for low-income children to attend private schools. The program, which is slotted for $44.8 million in funding in 2017-2018, is a lightning rod for public school defenders, who point out private schools lack the same accountability and non-discrimination requirements of public schools. And, with a report this year suggesting the state’s voucher students are not being helped by enrollment in private schools, the final budget deal eschews House calls for an independent study of voucher student performance and the requirement that voucher students take one nationally standardized test for comparison purposes.  However, it allows for a task force to mull ways to evaluate voucher student performance, with a report expected next March.
  6. Personal education savings accounts: Labeled “vouchers on steroids” by critics, this program allows for the state to divert public funds to the private accounts of parents who seek to enroll their children in private schools. While it limits participation to parents of children with disabilities this year, it’s likely a first step in opening the door for greater access in the coming years, despite widespread questions about private school accountability and allegations of misspent cash in other states.
  7. School performance grades: The compromise deal nixes House proposals to reform a long-criticized method for assessing school performance. Advocates say student growth—rather than the school’s overall performance—should play a greater role in determining the score. Currently, the score is determined by 80 percent performance, 20 percent growth. A House proposal to establish separate grades did not survive conference committee negotiations. In addition, the deal announced this week also moves to a more stringent 10-point grading system in 2019-2020, rather than the 15-point scale preferred by advocates for school districts.
  8. Textbooks and classroom supplies: Amid myriad plans for boosting the state’s oft-criticized funding for classroom supplies, the conference committee emerged with a fairly conservative proposal, allocating about $11.2 million in a non-recurring boost to the allotment in the coming year. Critics say the state continues to fall far short of the necessary funding levels for this allocation, forcing teachers and school districts to spend to provide for updated classroom materials.
  9. Children with disabilities: One of the few bright spots of earlier budget proposals, according to some education advocates, the compromise increases the funding cap for children with disabilities, slotting another $6.3 million in recurring funds.
  10. Teaching Fellows: The plan, as expected, uses $6 million in cash from the state’s Education Endowment Fund to fund a new version of the teacher scholarship plan controversially scrapped by GOP lawmakers in 2011. The new version will focus on science, engineering, math, technology and special education, offering university scholarships for prospective teachers in exchange for a commitment to work in North Carolina. Lawmakers say they are hoping to address a well-documented drop in UNC students seeking teaching degrees in recent years.
  11. Superintendent’s office: With the state’s newly-elected GOP Superintendent of Public Instruction Mark Johnson mired in a battle with the State Board of Education over the hiring powers of his office, state lawmakers are getting involved. The budget includes a House proposal to allocate $700,000 for Johnson to create up to 10 new positions that report solely to him. The proposal had earlier earned the rebuke of the GOP chairman of the state board, who says the positions and funding are needed for other roles in DPI.
  12. Governor’s School: The compromise deal bypasses a Senate proposal to ax state funding in 2018-2019 for the five-week, summer program, which focuses on academics and arts.
  13. Advanced teaching roles: The budget will spend an additional $7.1 million in non-recurring funds next year, bringing the total to $8.2 million, on a three-year pilot program aimed at offering incentives for so-called “teaching leaders” in school districts.
  14. Eastern N.C. STEM: The deal restores funding for a summer science, math and technology program that’s primarily served low-income, black youth in eastern parts of the state. GOP budget writers in the Senate stripped funding from the program in an early-morning cut that seemed a retaliatory strike against Democratic critics of the Republican budget. 

Keep checking back with Policy Watch for updates and feedback from top education advocates.