NC House can choose a different future for North Carolina

Yesterday, NC House members began releasing details of their budget proposal in committees. Without a transparent view of how these pieces fit together and other considerations that factored into the plan, we will have to wait for a full assessment of the path that the House will take.

More than a month has passed since the Senate passed its budget and the start of the new fiscal year — July 1. However, preliminary information from yesterday’s committee review suggests there is still time to choose a better path for North Carolina.

House leaders agreed to an arbitrary spending limit with the Senate before the start of the process, but the sheer scale of need demands more careful consideration of public input and more responsible stewardship of public resources than the Senate put forward.

As was evidenced in a number of committee reviews yesterday, the House budget misses committing long-term to community needs by making small-scale allocations rather than bolstering public systems, as well as using one-time money rather than recurring resources.

House leaders appear poised to accept the Senate tax plan that would slash income tax rates for the wealthiest and profitable corporations. The personal income tax changes alone would deliver 74% of the net tax cut to the richest 20% of North Carolinians.

The standard deduction and lower flat rate that Senate leaders propose actually excludes hundreds of thousands of North Carolinians with low incomes who carry a heavier sales and property tax load. The Senate proposal also provides just half the tax reduction, when calculated as a share of income, to North Carolinians with income below $66,000 (those in the bottom 60% of the income distribution) than is provided to the richest 1%.

The House can afford to choose a different future for North Carolina — one that advances the well-being of all people rather than focuses on tax cuts for the rich and profitable corporations as the Senate did. By establishing the systems and structures that strengthen communities and the economy for the long-term, lawmakers can help families move past the pandemic to sounder footing.

The North Carolina Justice Center delivered a letter to the House two weeks ago detailing some of the areas for public investment. This list of recommended appropriations — while not exhaustive — would fall well within the resources the state has available today.

The list of recommendations includes commitments for the next two years to providing a sound, basic education to every child, increasing affordable housing development, stabilizing the early childhood system, helping people access health care, and ensuring that people re-entering communities are supported for success.

Redirecting 40% of dollars that the Senate proposed for tax cuts and for additional allocations to savings reserve and the state capital and infrastructure fund in the first year, and 60% in the second would be more than sufficient to meet these recommendations.

North Carolina leaders committed to helping people could go even further to advance the well-being of us all right now.

We need our elected leaders to choose a different path — one that helps people and makes sure our state can be ready to support people’s well-being for the long haul. It is the best path to a brighter future for North Carolina.

Alexandra Forter Sirota is Director with the Budget & Tax Center, a project of the NC Justice Center.

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