- Associated Press - Friday, September 18, 2015

RALEIGH, N.C. (AP) - The long-delayed North Carolina budget finally neared enactment as the House gave its final approval early Friday to a two-year spending plan that Republican leaders took all summer to hammer out. Gov. Pat McCrory has promised to sign the bill into law.

The House voted 81-33 just after midnight for the budget, a margin similar to the chamber’s initial approval late Thursday night following four hours of debate. The Senate already signed off on the plan Wednesday, so essentially all that’s left is McCrory’s signature.

The measure, which spends $21.7 billion this year and a little more next year, pays for experience-based raises for public school teachers and confirms raising minimum teacher salaries to $35,000. All state employees and teachers also will get $750 bonuses at the end of the year. Other state workers in targeted fields will get permanent raises.

There also is $600 million set aside this year for emergency reserves and government building repairs.

“This is a commonsense, affordable budget,” said Rep. Dean Arp, R-Union, one of the budget negotiators.

McCrory told reporters earlier Thursday he decided he would sign it because all the things he wanted that are in the legislation outweigh the items he dislikes. Among them are two new Cabinet-level departments, funding for mental health and the revival of a tax credit for historic building preservation.

Eleven Democrats ultimately joined all Republicans in voting for the final measure, a departure from the first budget bill the House passed in May, when more than 30 Democrats voted yes.

Among the Democrats who switched was Rep. Tricia Cotham, who said she couldn’t vote for the final budget because education funding and bonuses are just not good enough. North Carolina used to be the Southeast’s leader and innovator in education, she said. The earlier House budget had sought to spend $421 million more than the final negotiated plan and offered across-the-board raises.

“The budget doesn’t strive for the best,” said Cotham, D-Mecklenburg. “It signals that adequacy is the new norm for North Carolina.”

McCrory told The Associated Press last weekend he had concerns about budget provisions that would expand the number of transactions subject to the sales tax to include car repairs and appliance installations. Local tax proceeds largely would be distributed to assist about 80 mostly small and rural counties. McCrory had threatened in late July to veto an earlier sales tax redistribution proposal.

In an interview Thursday, the GOP governor said he still doesn’t like the expanded sales tax, which he previously called a tax increase.

A veto would have led to a showdown with the legislature, which has already passed three temporary spending measures since the budget was unfinished by July 1. The third stopgap law expires Friday night. A veto could have left state government without fiscal direction to operate.

Given the positives in the overall spending plan, McCrory said, “there’s no way that I’m going to as governor shut down government or our schools because of some disagreements within a $21 billion budget.”

House Republicans point out public school spending increased in the budget by more than $410 million compared to last year, with more funds for textbooks and Wi-Fi. Funding for teacher assistants and driver’s education was preserved. Early-career teachers had a $30,800 minimum salary just two years ago.

Division of Motor Vehicles fees also would go up largely from 25 percent to 33 percent, including driver’s license and registrations. But the bill also cuts the personal income tax rate in 2017 and expands sooner the standard deduction for all tax filers, allowing Republicans to call the overall budget a net $384 million tax reduction through mid-2017.

Democrats said GOP colleagues could have invested more in education if the income tax rate cut hadn’t occurred and a $445 million surplus last year was used wisely.

The budget “just continues a plan that hurts families and will cost the North Carolina economy for years to come,” said Rep. Susan Fisher, D-Buncombe.

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