RALEIGH, N.C. (WNCN) – Gov. Roy Cooper (D) said Tuesday he will sign the proposed state budget being voted on by lawmakers this week.

Cooper says the “good outweighs the bad” in the proposed bill.

“It moves North Carolina forward in important ways, many that are critical to our state’s progress as we are emerging from this pandemic,” he said. “And, while I believe it is a budget of some missed opportunities and misguided policy, it is also a budget we desperately need at this unique time in the history of our state.”

Cooper said if he vetoed the bill, he believed that action would be upheld in the Senate but he feared Republicans would walk away from this proposed budget if that happened.

“And right now, we just can’t afford that,” Cooper said.

Some Democrats had already said they planned to vote in favor of the budget before Cooper’s announcement.

“Those good things outweigh some of the bad things. It was far from a perfect bill,” said Sen. Mike Woodard (D-Durham). “The governor did give us some guidance today, and I’m just pleased that my view of the bill and the governor’s were in alignment.”

The Senate gave initial approval Tuesday in a 40-8 vote. Fourteen of the chamber’s 22 Democrats joined with the Republicans in approving it.

“The fact that a number of Democrats have indicated their support for the budget had to have had some play in (the Governor’s) decision,” said Republican Senate leader Phil Berger.

Berger thanked Cooper for talking with Republicans in the recent negotiations. While those talks led to some changes in the budget, Cooper never reached a final agreement with the legislative leaders.

New details of the budget agreement were released Monday ahead of the first vote in the Senate on Tuesday.

Click here to read the full proposed budget

Here are some of the highlights: 

  • Most state employees would receive pay raises of 5 percent over two years plus a $1,000 bonus. The bonus would be $1,500 for those making under $75,000 and for those working in: law enforcement, corrections and 24-hour residential or treatment facilities. 
  • Teachers would receive pay raises on average of 5 percent over two years plus a bonus of up to $2,800. Community college faculty raises would be 6 percent over two years. 
  • The minimum wage for all non-certified employees in public schools and community colleges would increase to $13 per hour in the current fiscal year and to $15 per hour in the next fiscal year. 
  • Retirees would receive a 5 percent cost of living adjustment bonus over two years, which is not permanent. 
  • The personal income tax rate would drop from the current 5.25 percent to 3.99 percent over six years. The standard deduction and child tax credit would increase as well. Under an analysis released by Senate leadership this year, a family of four making the median household income of $54,602 would see their tax bill reduced by $566, or 37%, when the plan is fully implemented. 
  • The corporate income tax would be phased out over six years beginning in 2025. The corporate franchise tax will be reduced as well. 
  • The rainy day fund would be increased to $4.25 billion, more than doubling the current balance of $1.98 billion. 
  • Would allocate $5.9 billion into the State Capital and Infrastructure Fund (SCIF) to build, renovate and repair buildings for state agencies, the UNC system, community colleges and other assets. 
  • Would include a limited expansion of Medicaid to cover 12 months of postpartum care. The budget does not include a full expansion of Medicaid, as Gov. Cooper has wanted. 
  • Would add Fayetteville State University to the N.C. Promise program, which sets tuition for in-state students at $500 per semester. 

Cooper said that many of the things that the budget gets right are things he had previously put forward in other budget proposals – but that the legislature didn’t get everything right. 

“Many of these were in my budget and my past budgets presented to the legislature,” he said. “But I am clear-eyed that there are ways we differed and places where the legislature got it wrong.” 

Cooper highlighted Medicaid expansion as one of the areas where the budget fails. 

“[T]his budget fails to extend health care to hundreds of thousands of people by expanding Medicaid. While a study is some progress, real action remains painfully overdue,” he said. 

Cooper also focused on other parts of the budget that he seriously disagrees with, including tax breaks that are “more toward corporations and the wealthy rather than the middle class and lower-income North Carolinians.” 

The governor also said that the budget “makes unnecessary and politically motivated missteps that I believe should and will be overturned in the courts” and that despite his pending signature, he wants to “make it clear that I do not consent to the constitutionality of these provisions.” 

The budget would total $25.9 billion this fiscal year and $27 billion next fiscal year. 

North Carolina is the last state in the country to adopt a budget. During the last two-year legislative session, Republicans and Democrats couldn’t reach an agreement. 

This time, Cooper met behind closed doors with Republicans as they tried to find a compromise out of the public eye. 

The governor called the budget “imperfect,” but said that there are too many people in need of help to not sign it. 

“However imperfect this budget is, our schools, our communities, our small businesses, our families need our help right now, especially as we recover from this pandemic,” he said. “I will sign this budget because of its critical and necessary investments and I will fight to fix its mistakes.” 

Sen. Dan Blue (D-Wake) cast one of the eight votes in the Senate against the budget Tuesday. 

He highlighted a new program that will use $100 million in state funding to pay salary supplements to teachers in lower-wealth counties. The program applies to all but five counties: Wake, Durham, Mecklenburg, Guilford and Buncombe. 

“Almost surgically targeting, surgically targeting, the districts only of Democrats,” said Blue.  

Sen. Berger said the purpose of the program is to help counties struggling to afford higher salary supplements to be able to compete with wealthier counties and potentially be able to recruit and retain teachers. 

“And, it is the best $100 million that we are spending in this budget,” he said. 

North Carolina House Speaker Tim Moore released a statement following Cooper’s press conference:

This budget represents months of hard work and good-faith negotiations between Republicans and Democrats, House and Senate, and our Governor. The result is a spending plan for the state that addresses the most critical needs of North Carolinians. North Carolina has not had a budget since 2018, and I am encouraged that Governor Cooper has promised to sign this budget and we can finally give our state a budget they can truly be proud of and one that meets the most critical needs of North Carolinians.”

House Speaker Tim Moore

North Carolina Attorney General Josh Stein released a lengthy statement regarding the budget:

I am encouraged by the legislature’s ongoing partnership to address the critical issue of untested sexual assault kits in our state. The budget provides both funding and additional scientists, which will allow us to continue to test kits and help law enforcement solve cases. Given the scale of the backlog of kits in local law enforcement custody, it will take time to eliminate, but we must continue to attack the backlog so we can deliver justice for victims, put dangerous people behind bars, and make our communities safer.

The budget also fully funds the CJ Fellows Program which pays for the education of public spirited young people who pursue a career in law enforcement. This effort will help address the shortfall of law enforcement officers across the state.

Additionally, I am pleased to see that the legislature is appropriating the funds from my office’s wins against Juul and McKinsey over improper e-cigarette and opioid marketing. These funds will go a long way in protecting North Carolinians by helping prevent and treat addiction.

Finally and unfortunately, the legislature is trampling on the separation of powers in ways that are clearly unconstitutional. In addition, the failure to restore the prior cuts they made to the Attorney General’s office undermines our capacity. All of this is contrary to the people’s interests.”

North Carolina Attorney General Josh Stein

Just after 1:10 p.m., the North Carolina Senate voted 40-8 to give preliminary approval of the state budget. The final vote in the Senate is expected on Wednesday.