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Posted by : Thursday, June 27, 2013 1 Comment In Falling Behind in NC, NC Budget and Tax Center

This is the fourth post of a week-long blog series that seeks to uncover just how far behind North Carolina’s current services levels are compared to pre-recession levels as well as how far behind the state would fall if the House and Senate tax plans were implemented. Previous posts are available here, here, and here.

North Carolina’s revenues are slowly recovering but still deeply damaged by the recession. Regaining the ground that we have lost will be more difficult in the coming years because state lawmakers are pursing deep and lopsided tax cuts that will put at risk the critical public services that help build the engines of long-term economic growth.

There is much ground to be regained in North Carolina’s public education system, which prepares our children for the jobs of the future and participation in civic engagement.

North Carolina is investing less in public education than when the recession began. Total state funding declined by 10 percent since the 2008 fiscal year while enrollment increased by 2 percent—a modest but steady rate. This means that there are $883.1 million fewer dollars (adjusted for inflation) in state funds available today for education compared to 2008 despite having 31,000 more students to educate. Read More

Posted by : Wednesday, June 26, 2013In Falling Behind in NC, NC Budget and Tax Center

North Carolina’s revenues are slowly recovering but still deeply damaged by the recession. Regaining the ground that we have lost will be more difficult in the coming years because state lawmakers are pursing deep and lopsided tax cuts that will put at risk the critical public services that help build the engines of long-term economic growth.

It is unquestionable that there is a lot of ground to be regained—especially when it comes to investing adequately in the health, safety, education, and economic security of families and children. The current state budget for health and human services (HHS) is proof. Read More

Posted by : Wednesday, June 26, 2013 3 Comments In Falling Behind in NC, NC Budget and Tax Center

For more than a century, North Carolinians have pooled their resources to invest in great achievements, including a statewide K-12 system, the oldest public university system in the country, transportation infrastructure and a lot more. Taxes matter for the economy and society that we all enjoy so how the state government raises the billions of dollars that fuel the state budget is very important.

And, the ability of the state tax system to grow with the economy and keep up with the cost of public services and the changing needs of the population is critical. Yet, this continues to be a missing part of the debate over the impact of tax plans under consideration

Senate and House leadership say that their plans merely slow the rate of state spending to around 3 percent and 4.5 percent, respectively, compared to the long-run average of 4.8 percent. A 1.5 percentage point drop and a .3 percentage point drop in the revenue growth rate sound innocuous at first glance, but further analysis shows just how devastating this would be. Read More

Posted by : Tuesday, June 25, 2013 9 Comments In Uncategorized

Phil BergerIt’s funny how a little water under the bridge and a change of jobs can alter one’s perspective on public events.

This is from a 2009 News & Observer “Under the Dome” story about then-Senate Minority Leader (and current Senate President Pro Tem) Phil Berger slamming budget negotiations between House and Senate leaders — mind you, this was during a period of profound budget crisis in which the Great Recession was pummeling the state’s economy and tax revenues:

“Senate Republican leader Sen. Phil Berger said it’s another example of Democrats’ incompetence that the state doesn’t have a budget 14 days into the fiscal year.

‘For the average person, when they have a deadline and they need to get something done, they are held accountable,’ said Berger, an Eden Republican, at the weekly Republican news conference.”

Now flash forward to 2013. This is from a “Dome” story posted this morning: Read More

Posted by : Tuesday, June 25, 2013 1 Comment In NC Budget and Tax Center

As expected, the Senate Appropriations Committee passed a stop-gap measure this morning that will keep the state government running during the first 30 days of the next fiscal year that starts on July 1st. The closed-door negotiations over the tax plan continue to hold up the budget process, prompting legislators to miss the June 30th deadline for passing a two-year spending plan.

The resolution permits state agencies to spend up to 95 percent of their authorized budgets from the current fiscal year. The Office of State Budget and Management is tasked with determining how to trim the other 5 percent. Budget writers claim that a reduction is required to make up for a projected spike in Medicaid checkwrites resulting from a switch to a new payment system that will begin on July 1st.  In an unusual move, the measure also appropriates additional dollars to address the Medicaid shortfall by using unspent dollars, overcollections, agency reversions, and a portion of the TANF block grant. Read More

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