Those who were hoping the 2008 General Assembly would address some of the state's major challenges – such as devising a new revenue system or formulating an aggressive transportation program to handle a growing population – are in for a disappointment.
As House and Senate leaders have made clear, they have modest goals in this year's supplemental appropriations bill, the key legislative document that guides state policy. Last week the House rejected Gov. Mike Easley's proposed tax hikes on cigarettes and alcohol and adopted a plan that boosts state spending by 3.2 percent, a comparatively small sum compared to recent years. That's one reason why it attracted support from Republican legislators, passing on a 104-10 vote on final passage.
The House bill includes a 3 percent pay raise for teachers, but not as much as Gov. Easley wanted to boost average teacher pay to the national average. The governor had proposed a 7 percent increase for teachers and a 20-cents-per-pack cigarette tax hike plus higher levies on alcohol.
The tobacco tax hike would have made the state's excise tax on cigarettes 55 cents per pack, still far less than the national average, but lawmakers were not in a higher-tax mood. On the other hand, they did favor raising certain fees, including a $20 increase in the fee for divorce proceedings. The bill includes an increase in the earned-income tax credit for working families.
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While the House budget had bipartisan support, Gov. Easley complained that it was “stiffing the teachers” and also left education programs with an insufficient sum. For example, the House approved only a $45 million increase in funding for his pre-kindergarten program. And the House did not fully fund enrollment increases in the UNC system, while leaving intact a controversial feature that allows athletes from out-of-state to attend UNC-CH and N.C. State at in-state rates. That saves booster clubs a ton of dough but it doesn't do much for taxpayers who subsidize those out-of-state students.
But there's some gamesmanship going on here. The Senate likely will restore some of the missing education funding in its version of the budget. It should also fund Gov. Easley's proposals for additional occupational safety nurses and industrial hygienists to inspect poultry plants. A recent Observer series highlighted how the poultry industry discourages workers from getting proper health care and how plant practices often lead to debilitating worker injuries.
With a slowing national economy, many states have been forced to significantly cut programs. North Carolina has a small revenue surplus to work with because it made conservative estimates a year ago. That has enabled the state to pursue some key goals, including programs to fight an abysmal school dropout rate. The Senate should renew its emphasis on education and improve a good House bill.