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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 and Part 2)

This week, more than 1.5 million North Carolina’s students headed back to school to underfunded classrooms. For yet another school year, teachers will do their best to prepare today’s students to grow into critical thinkers and succeed as workers in a demanding 21st century economy with too few resources available. Legislative leadership and the Governor approved a budget that fails to make up lost ground in public education, keeping spending below the last budget that was in place before the Great Recession.

In fact, when the pay raises for teachers are properly placed in the salaries and reserves section of the General Fund budget and not the public education section—a practice that has long been in place—public education spending in the new budget is below last year’s spending levels (see graphic below). This certainly is not progress, but rather sliding backwards with a budget trick used as cover.

Five years into the recovery from the worst economic downturn since the 1930s, catching up and keeping up with the needs of North Carolina’s students is stalled due to the fact that lawmakers chose to enact a tax plan last year that keeps the state from replacing the most damaging cuts to public investments. The 2013 tax plan is draining available resources—$5.4 billion over five years—that is needed to regain lost ground and reinvest in the building blocks of a strong economy. The tax plan’s impact is evident throughout the final budget for fiscal year 2015. Read More

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Tillis_McCrory_Berger-400You know…the day that North Carolinians can finally say adieu to the 170 members of the 2013-14 General Assembly? As has almost always been the case with the current crop of state lawmakers, the signals are mixed and confusing.

News reports this morning indicate that even as legislative leaders  look for ways to append a badly needed fix onto the terribly flawed budget that was just passed a few days ago, they’re once again playing political games with each other and the citizenry.  If this is how things end — with a critical provision to help schools made contingent upon a new corporate giveaway scheme — it will be a fitting conclusion to a remarkably ineffective and discombobulated session.

As Charlotte Observer columnist Fannie Flono notes this morning:

Perhaps it’s only fitting that the N.C. legislature comes to the end of its long short session in a squabble over how and when to end it. It hasn’t mattered much that the Republicans are in charge of everything – the state House and Senate and the governor’s office. GOP infighting and House vs. Senate power plays – along with a little muscle-flexing or attempts at it by Gov. Pat McCrory and his staff – have been constant backdrops during the session that began May 14.

In the plaintive words of Rodney King, paraphrased: Can’t they all just get along? Or at least agree to close down the shop and get out of town? And save us taxpayers the $50,000 a day it typically costs for them to be in session?

Of course, there’s a very good chance this will not be THE day. Having apparently failed to fashion a coal ash clean up plan in the more than six months that have passed since the Dan River disaster, the General Assembly may return yet again after the fall election for a rare “lame duck” session. If that happens, at least a couple of things appear to be certain:

1) It won’t be the first time the adjective “lame” will be used in the same sentence with the 2013-14 legislature and  2) Coal ash will be far from the only mess that will be left behind for future General Assemblies to clean up.

/www.charlotteobserver.com/2014/08/14/5106886/legislative-session-was-a-squabble.html#.U-3lMKMf6So#storylink=cpy

 

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People_16_Teacher_BlackboardThe verdict on the confusing new pay structure enacted by the General Assembly and the Governor’s office continues to draw, at best, mixed reviews. As Raleigh’s News & Observer noted — somewhat charitably — last week:

Once again, the inexperience of Republican leaders is showing. Their teacher pay plan does address the need to pay less-experienced teachers more, and that’s good. But more experienced teachers aren’t getting much, which is going to encourage more of them to retire, and that’s not good.

Even if one gives state leaders credit for bumping up the pay for some of the state’s teacher workforce from its bottom-of-the-barrel status, however, it’s becoming increasingly clear that their stubborn adherence to implementing new tax cuts is forcing the raises to be purchased at a very high price.

For the latest example of this troubling phenomenon, check out Lindsay Wagner’s story this morning over on the main PW site: “N.C. Department of Public Instruction forced to eliminate more than 50 jobs that serve struggling schools, technology infrastructure.” As Lindsay reports:

The agency tasked with implementing the state’s K-12 public school laws and policies is coping with a 10 percent funding cut handed down by lawmakers last week by eliminating more than 50 jobs, many of which are devoted to helping struggling schools.

“We’re abolishing approximately 54 positions out of roughly 450 state-funded staff positions,” said Dr. June Atkinson, State Superintendent of Public schools and head of the N.C. Department of Public Instruction.

It’s a 10 percent funding cut to DPI, the largest reduction to any state agency, said Atkinson.

And while defenders of the DPI cuts will argue that they’re all about slashing “bureaucracy,” the hard truth is that they are far from the only new “belt tightening” measures enacted in this year’s education budget. In other words, the pay raises remain essentially a fig leaf for what remains an ongoing, long-term war on public education waged by people committed to privatizing the single most important function of state government.

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Drone 2As Sarah Ovaska reported this morning in her story on some of the hidden gems in this year’s state budget bill, North Carolina now has – with virtually no meaningful public discussion — a new and flawed law on the use of those cute little aerial spying machines known as “drones.”

Unmanned aircraft, also known as drones, can no longer be used by people or state agencies to conduct surveillance without landowners’ consent. The law carves out some exceptions for law enforcement and media covering news event, and makes adding a weapon to a drone a felony. Outdoorsmen and outdoorswomen need to pay attention: using a drone to hunt or fish is now a misdemeanor. Some of the wording in the budget still leaves questions about how to legally use drones, and the new rules may make it difficult to use drones to take photographs or video for artistic purposes, said Sarah Preston, of the ACLU of North Carolina. “There’s still a lot of stuff that’s left up in the air,” she said.

One of the state’s most active and engaged critics of drone use and the backroom efforts of politicians with connections to the drone industry is Asheville activist/advocate Barry Summers. Yesterday, Summers authored a forceful critique of the new law in the Asheville Citizen-Times. As Summers notes:

During the final days of the budget train wreck in Raleigh, H1099 (Unmanned Aircraft Regulation) was slipped anonymously into the 2014 budget. This is the perfect, shameful and shabby end to a process where the GOP-led NCGA has failed to protect our civil liberties. Read More

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A new report from the Robert Wood Johnson Foundation and Urban Institute shows the financial folly of rejecting Medicaid expansion. Currently 24 states are refusing federal funds to cover more of the uninsured, although that number is quickly dwindling as more governors and legislators get approval to implement state-specific expansion plans. If North Carolina does not act soon we will find ourselves in lonely company.

Here are the numbers. On average, the Urban Institute finds that every $1 invested in Medicaid expansion will bring $13.41 in federal funds to the state. In North Carolina the 10-year cost to expand Medicaid is $3 billion, although the savings and cost offsets mean that the state would actually save money in the budget over that timespan. At the same time our state is losing nearly $40 billion over 10 years by not expanding Medicaid. Hospitals in our state stand to lose $11.3 billion over 10 years, which is why we are seeing layoffs and closures at hospitals across North Carolina.

This financial picture has convinced even rock-ribbed Republican governors across the country to champion expanding coverage in their states. Many of these political leaders from Arkansas to Iowa, Indiana to Utah, are proposing to increase coverage by applying for a Medicaid waiver that allows these states to use federal funding to craft creative alternatives to traditional Medicaid expansion.

Arkansas led the charge on this front by using expansion funds to buy private insurance coverage for low-income individuals and families in that state. And we see that Gov. Mike Beebe certainly hasn’t suffered by doing the right thing. He currently enjoys a 60 percent approval rating compared to 23 percent who disapprove of his policies. Despite being a Democrat his ratings are even above water with Republican voters. Compare this with Gov. McCrory who is having trouble cracking 40 percent in his approval ratings.

Gov. McCrory could add some polish to his image by expanding health coverage to 500,000 more people, bringing $40 billion in federal funds to the state, and boosting hospital bottom lines by $11 billion. Who knows, it may even help the legislature pick its approval ratings up off the floor.