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Dear Together NC Members & Allies:
Today the Governor released her budget for the 2011-13
biennium. From a big-picture standpoint, overall the Governor heeded
our calls and took a relatively balanced approach to the state budget
by including some revenue and maintaining some core public investments.
It's also very important to acknowledge that the cuts proposed
by the Governor will be deep and painful, particularly those to state
workers.
On the revenue side:
Gov. Perdue proposed partially extending the temporary
sales tax package ($0.75 of the 1-cent temporary sales tax increase
added in August 2009), which will bring in an estimated $826 million
in additional revenue next year.
The Governor's decision to extend part of the temporary
tax package, we believe, shows leadership that she should be
commended for.
But she also proposed cutting the corporate income tax
rate by two percentage points, which will result in a loss of around
$400 million in revenue next year as well as letting the temporary
surcharge on upper income earners expire.
On the spending (i.e. public
investments) side:
Governor Perdue did a decent job in protecting public
investments like health services, early childhood and community
colleges from draconian cuts. For example, the Governor's
budget proposes:
* keeping
state-supported K-12 teachers and teacher assistants in the
classrooms
* bolstering
funding for critical mental health services by adding $75 million to
the NC Mental Health Trust Fund
* fully funding
enrollment growth in community colleges and universities
* maintaining
open enrollment for NC Health Choice, the state's low-income kids
health insurance program
* minimizing
cuts to early childhood programs like Smart Start and child care
subsidies
However, areas like K-12 education still saw large cuts that
could still result in layoffs and additional pressures on
already-saddled county and city budgets. The university system
was hit particularly hard.
Two state parks are to be closed and 14 state agencies
are to be consolidated into 8. And within Medicaid, cuts are
proposed based on anticipating savings from efficiencies and fraud
reduction that may not be realized.
Governor Perdue's budget proposes cutting 10,000 state
jobs, although the state budget director reports that 7,000 of those
are vacant positions. The loss of these jobs, permanent or
vacant, could have a deep impact on services, local economies, and
families.
The Budget & Tax Center
will release a comprehensive analysis of the Governor's budget but
you can check it out for yourself here.
And here is the press statement we released in response.
Again, the Governor's budget is far from perfect and if
enacted, would impose some deep cuts and pain in many places of our
state. We wish she had looked at more reform-minded revenue options
as well. However, we are pleased to see that she chose to take
a largely balanced approach to the state budget as a cuts-only
approach would have been far worse.
We'll keep you posted with developments. Now our
work turns to the legislature.
Many thanks and onward,
Louisa, Rob, & Clayton
Rob
Thompson Louisa
Warren
Clayton Brooks
(919) 649 2449
(919)
856-2183 (919)
861-2069
rob@nccovenant.org
louisa@ncjustice.org
clayton@togethernc.org
Many thanks
and onward!
Louisa, Rob,
and Clayton
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