Tag: state budget

Budget Preview: North Carolina’s Justice and Public Safety budget requires adequate funding to fulfill responsibilities

March 15, 2013 at 5:13 pmCategory:NC Budget and Tax Center

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The safety and quality of life of communities across the North Carolina rely in part on investments in our judicial and public safety systems. Significant funding cuts to the Justice and Public Safety (JPS) budget in recent years have challenged various JPS agencies to take on more responsibilities with fewer resources. Since FY2009, net appropriations for the JPS budget have been cut by more than $218 million.

In recent years, cuts in funding to the JPS budget have also resulted in increases in court costs and fees. However, the Fiscal Research Division reports that court costs collections are down about 10 percent. The legislature closed four minimum custody programs in order to reduce costs in 2011. Furthermore, state funding has been completely cut for some divisions within JPS, which are now mandated to operate as fully-receipt funded operations. Read More…

Budget Preview: North Carolina’s transportation budget faces long-term $60 billion shortfall

March 14, 2013 at 5:36 pmCategory:Falling Behind in NC | NC Budget and Tax Center

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North Carolina’s transportation system helps form vital social and economic structures by connecting people to services, jobs, and other opportunities across the state and beyond. Although North Carolina has been known as the Good Roads State, its transportation system is under considerable pressure due to aging infrastructure, increasing demand, and declining revenue sources that are failing to keep pace with rising costs to maintain and improve the system.

Just last August, the North Carolina Department of Transportation confirmed that there is a large and growing gap between transportation needs and funding. They released a report estimating that the state is facing a $60 billion shortfall for transportation improvements through 2040, and that the state needs to come up with $32 billion just to keep the status quo. Ultimately, legislators control the purse strings as well as revenue options so solving this budget shortfall is largely up to them. Read More…

Funding Cuts to Public Education Threaten State’s Leadership Position Among Southern States

February 27, 2013 at 3:25 pmCategory:Falling Behind in NC | NC Budget and Tax Center

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This week has been deemed Education Week by legislative leaders, who have invited superintendents, principals and teachers from across the state to Raleigh to discuss public education issues. As education leaders and teachers share their thoughts and concerns regarding public education, funding has been a key part of that conversation.

With consistent improvement in proficiency rates, National Assessment of Educational Progress (NAEP) scores, and graduation rates over the past 20 years, North Carolina has long been recognized for its commitment to public education – both K-12 education and higher education. However, significant cuts made to K-12 and higher education in recent years threaten to erode the leadership position the state has achieved among southern states. As lawmakers work to craft and approve a biennial budget for FY 2014-15, investment in public education will be a central part of the budget debate.

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Report highlights that taxes and spending are not out of line in North Carolina

February 25, 2013 at 1:42 pmCategory:NC Budget and Tax Center

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A report released by the Program Evaluation Division within the NC General Assembly highlights that North Carolina ranks in the middle of the pack, or better, among states for various taxes and spending metrics. For FY2009-10, metrics for which North Carolina ranked in the top half of states include:

  • Per capita state expenditures (12th lowest among states);
  • Per capita state and local taxes (17th lowest among states);
  • State and local taxes as a percentage of personal income (23rd lowest among states); and
  • Per capita state taxes (24th lowest among states).

These rankings disprove the claim that state spending and taxes in North Carolina are out of line. Our state ranks in the middle of the pack or on the lower end among states. Read More…

Protecting the state budget: Yet another reason to include new federal revenues in a sequestration fix

February 22, 2013 at 10:00 amCategory:NC Budget and Tax Center

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The looming federal sequestration cuts have been all over the news recently, as the clock ticks down to the March 1 deadline imposed by the fiscal cliff deal.  While most media accounts have focused on the negative consequences these across-the-board spending cuts will have on defense programs and military communities, the cuts to federal non-defense domestic programs will also have profoundly damaging—if often underreported—impacts on the North Carolina state budget. In light of these impacts, Congress needs to repeal sequestration and replace these indiscriminant, automatic spending cuts with a balanced approach that includes at least one dollar in new revenues for every dollar of smart spending reductions and that protects the state budget.

Enacted in the Budget Control Act of 2011, these sequestration spending cuts were intended to automatically reduce funding for national defense and domestic programs like K-12 education, job training, Head Start, food inspects, and research and development by $1.2 trillion over the next decade if Congress could not find another way to reduce the federal budget deficit before December 31, 2013. Congress postponed that New Year’s deadline to March 1, and if Congress does not resolve this issue in time, North Carolina will experience $85.3 billion in sequestration cuts in 2013 alone.

According to a wide range of analysis conducted over the past two years, sequestration is expected to inflict significant damage on North Carolina’s economy and state budget. On the defense side, the cuts to Pentagon spending are estimated to cost North Carolina at least $1.5 billion in defense contracts and as much as 12,000 in job losses.  At the same time, the non-defense cuts are also expected to harm the state’s economy by reducing North Carolina’s Gross State Product by as much as $2 billion and contributing to more than 17,000 in job losses.

In a new twist on an old problem, the economic impact of these federal cuts would be magnified by the negative fiscal impacts on the state budget.  Specifically, the non-defense cuts will reduce the state’s Department of Health and Human Services budget by $35 million and education spending by $84 million—reductions that come on top of the steep cuts to state funding already enacted by the General Assembly in state FY 2011-13.

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