- Associated Press - Friday, August 1, 2014

RALEIGH, N.C. (AP) - The state House closed in Friday on finalizing a $21 billion budget full of trims, creative accounting, policy shifts and an average raise for public school teachers of about 7 percent.

The spending plan for the fiscal year that started a month ago won preliminary approval from the state House hours after the Senate passed it earlier Friday. The document was negotiated among Republicans, who hold large legislative majorities in both chambers.

A final vote is expected in the state House on Saturday. Gov. Pat McCrory said he would sign it into law.

The state budget holds overall spending flat in part by committing $153 million of one-time money and tapping $620 million in savings from the previous year. Student-to-teacher ratios in kindergarten and first grade will be smaller, but child care subsidies are being reduced and Medicaid provider payments cut.

Teachers, now among the nation’s lowest-paid, get raises ranging from 3 percent for the most senior educators to nearly 19 percent for those in their fifth year. School administrators will receive about $800 more while office workers and other non-certified staff receive $500. Most other state employees will get a $1,000 pay raise and five extra vacation days.

With the spending plan all but settled, the debate over whether it helps or hurts people - and by how much - was already underway Friday.

The budget and other work of the General Assembly will be hotly debated because House Speaker Thom Tillis is the GOP nominee in a nationally watched U.S. Senate race against incumbent Democrat Kay Hagan. Republicans began legislating last year with majorities so large that Democrats and a veto threat from McCrory, a fellow Republican, could not change their direction as long as lawmakers stayed together.

“Out in the mountains they’ve got a saying. They say, ‘when they learn us they like us.’ When they (the public) learn this budget, they’re going to like it,” said Tillis, emphasizing that he was speaking to an audience outside of his House colleagues.

Republicans are banking on income and corporate tax cuts they approved last year stimulating job growth and tax revenues. The individual income tax cuts are now estimated to diminish the state’s annual income by $680 million this year and may hit $5.3 billion over five years because of the lagging wages of North Carolina workers, according to the General Assembly’s non-partisan fiscal research division.

Democrats warned that cutting services and culling together pots of one-time money won’t prepare the state to recover from the Great Recession.

“It’s a duct-tape budget. One that is strewn together and that is for the future fiscally irresponsible and unsustainable,” said Rep. Rick Glazier, D-Cumberland.

Last year’s tax cuts favored wealthy families and corporations and they are starving a recovering state economy of the educated workforce and other elements needed to grow, he said.

“Budgets are not merely numbers we arrange on a piece of paper. They have real effects on real people,” Glazier said.

House Minority Leader Rep. Larry Hall, D-Durham, called the spending plan “a 90-day budget” designed to give Republicans a platform for November’s election. Lawmakers return two weeks after the elections to tackle changing the Medicaid program that provides health care to the poor and disabled.

There were pros and cons to the spending plan, as there are every year, said Rep. Bryan Holloway, R-Stokes, one of the House budget writers.

“In the ten years that I’ve been here, I’ve never, ever seen a budget that you couldn’t find a something in there that you didn’t like,” Rep. Bryan Holloway, R-Stokes.


Emery Dalesio can be reached at https://twitter.com/emerydalesio



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