Uncategorized

$1 billion budget (sink)hole facing NC in ’09

Much as we hate to be the bearer of bad news here at the NC Budget & Tax Center, we feel obligated to share with you, our progressive allies, our latest calculations about the fiscal situation facing our state budget next year. Think of this more as a call to action for all of us to work together for comprehensive tax reform and to make our collective budget priorities clearer to the rest of the world.

So here is what is facing state budget-writers next year. They will need to have enough revenue to cover the following items before they can even consider pay raises or other new investments.

1) Recurring items in current budget paid for with non-recurring revenues = $156 million

2) Non-recurring items in current budget historically funded as recurring = $220 million

3) Implementation of two tax reductions (EITC and gift tax cut) = $39 million

4) First year of payments on the new non-voter approved debt = $52 million

5) Growth in continuation budget needed to maintain current services = $500 million

Grand Total = $967 million

Tax revenues would have to increase by 4.75% in order to have this much available revenue which is greater than the current rate of growth. Also, please note that our numbers do not include any pay raise for state employees and teachers so add an additional $125 million to the hole for each 1% pay raise you want to assume.

Yes these numbers look dire, but it didn't seem right to calculate them and then not share them with the broader community. We must work together to address what really ails the state budget if we as progressives want to be able to progress rather than simply play defense when it comes to state budget and tax policy.

2 Comments


  1. […] $1 billion budget (sink)hole facing NC in ‘09Much as we hate to be the bearer of bad news here at the NC Budget & Tax Center, we feel obligated to share with you, our progressive allies, our latest calculations about the fiscal situation facing our state budget next year. … […]

  2. […] state, in case you missed it, will not have a ton of cash sitting around in […]

Check Also

A public success story: North Carolina’s older adults are far less likely to live in poverty

According to data released last week by the ...

Top Stories from NCPW

  • News
  • Commentary

North Carolina has less than a year of transition time as it raises the age of juvenile jurisdiction [...]

Sheila Holman, assistant secretary of the the North Carolina Department of Environmental Quality, wh [...]

“Is this person a citizen of the United States?” To some that might seem like a simple question to p [...]

Many Robeson County residents have drinking water that is more acidic than strong black coffee, whil [...]

Donald Trump does not and cannot act alone. Notwithstanding his serial dishonesty and raging narciss [...]

The post The NC Legislature wishes a happy birthday to MLK appeared first on NC Policy Watch. [...]

Same-sex couples in North Carolina won the freedom to marry in 2014, but LGBTQ people continue to be [...]

At long last, we’ve learned who UNC Chancellor Carol Folt is, just in time to say farewell. Folt’s i [...]