State budget wins final legislative approval

lbonner@newsobserver.comJuly 25, 2013 

The House and Senate gave their final approval to a $20.6 billion budget Wednesday, sealing changes to state education, health care and economic development.

Democrats were united against the budget. Some House Republicans didn’t want some of the provisions on education – namely ending teacher tenure and phasing-out extra teacher pay for advanced degrees – but voted for it anyway.

The final Senate vote was 32-17. The House approved it 65-53.

Rep. Nelson Dollar, a Cary Republican and a lead budget writer, called it “reasonable and responsible.”

“I do believe this budget does achieve the state’s goal of a well-educated, healthy and safe citizenry,” he said.

Sen. Martin Nesbitt, an Asheville Republican, hammered on education changes, saying they run counter to Senate leader Phil Berger’s goal of having all children reading at grade level by the end of third grade.

Democrats said the budget will hurt education and prompt teachers to leave the profession.

“We’re going to lose a lot of good professionals because they believe now that we really don’t respect what they do,” said Rep. Alma Adams, a Greensboro Democrat.

Two legislators questioned a $1.3 million provision in the budget that calls for a sole-source contract that appears to be written for one company to test equipment to clean up Jordan Lake.

“I do think that what this bill does in this piece is provide state funds to one vendor,” said Rep. Charles McGrady, a Hendersonville Republican. He worried that the budget contained other special provisions for specific companies.

“There are many very good things to recommend to you in the budget,” he said. “ … There are some very disturbing things in this budget, too.”

House Speaker Thom Tillis rarely speaks on bills, but he used the budget debate to chastise Democrats for sitting silent in years when there were Medicaid cost overruns. Democrats in charge of the legislature, he said, could have used the extra money to raise state employee and teacher salaries.

“Does anybody really think that I came down here to harm teachers?” asked Tillis, a Republican candidate for U.S. Senate. “That’s absurd. This is about a different means to the same end.”

About the money

The budget is about $400 million more than the budget for the 12 months that ended June 30. The legislature has more money to spend because it squirreled away about $213 million from last year and state agencies returned about $225 million they didn’t spend. Tax collections were about $458 million higher than anticipated.

The state budget is late this year because slow negotiations on tax cuts delayed passing a spending plan. Since July 1, the state has run on a stop-gap budget that expires at the end of the month.

What the budget does:

Education: Spends on new innovation grants, safety measures and the Excellent Public Schools Act. It phases-out teacher tenure and will no longer raise pay for teachers who earn advanced degrees. Provides for a voucher program to start in the 2014-15 school year for families that meet income guidelines.

Increases community college tuition by $2.50 per credit hour, or a maximum of $80 per year for degree students.

Increases tuition for out-of-state undergraduates in 2014-15 by 12.3 percent at the UNC School of the Arts, N.C. A&T State, UNC-Chapel Hill and UNC-Wilmington; 6 percent at other campuses.

Health and Human Services: Keeps pace with expected growth in Medicaid spending while reducing funding for the AIDS Drug Assistance Program, cutting 15 positions in the oral health section of the state Department of Health and Human Services. Three state drug abuse treatment centers will stay open, but will see their budgets cut 12 percent. The perennially endangered Wright School in Durham will remain open. Pregnant women will not be moved from Medicaid to private insurance offered through a new health exchange, as the Senate wanted.

Justice and Public Safety: Provides $2 million for community substance abuse treatment programs for high-risk offenders.

Closes prisons in Duplin, Robeson, Bladen and Wayne counties, converts the prison in Johnston County to minimum security and closes the Western Youth Institution. It spares the Orange County prison, which was on the target list.

Commerce: Spends $11.35 million to create a Rural Economic Development Division, a grant-making entity that will replace the Rural Center. Spends $800,000 to develop a branding strategy to promote the state.

Transportation: Caps the state gas tax at 35.7 cents per gallon, levies a $100 annual fee on plug-in cars and a $50 fee on non-plug-in hybrid cars.

General government: Provides $10 million to compensate victims of the state’s defunct eugenics program. The living victims must come forward by June 2015 for verification. So far, 177 living victims have been verified, according to the state Department of Administration.

What’s next

The budget goes to Gov. Pat McCrory for his signature. It has been a few years since a North Carolina governor has signed a budget. Former Democratic Gov. Bev Perdue vetoed the past two.

Bonner: 919-829-4821

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