RALEIGH, N.C. (AP/WNCN) — North Carolina Democratic Gov. Roy Cooper is proposing a spending and borrowing spree that he said is critical to fulfilling education, health care, and infrastructure demands evident before the pandemic but exacerbated since.
Cooper pitched his two-year state budget plan on Wednesday.
He said the spending proposal is affordable and ensures North Carolina continues a vigorous recovery from the COVID-19 recession.
It includes large pay raises and bonuses for educators and a $4.7 billion bond package.
It’s the job of lawmakers to draw a budget bill that they hope he will sign.
Republican legislators and Cooper failed to enact a conventional budget two years ago.
“The people of North Carolina elected us again, so we’re back in the same situation that we were. And, we owe it to them to do the best that we can to find a path forward,” Cooper said. “Everything is on the table. Everything is up for negotiation.”
Cooper’s proposal does not raise taxes. It would spend $27.4 billion in the first year and $28.5 billion in the second year.
Though Cooper and Republican lawmakers could not agree on expanding Medicaid previously, he said three things have changed since the previous budget stalemate. He pointed to the pandemic causing people to lose their employer-sponsored health insurance, the most recent stimulus bill providing financial incentives to states that have not yet expanded Medicaid and changes that will take effect in July to how North Carolina manages the Medicaid system.
“We must get health care to more working people. And, the best way to do that is to expand Medicaid,” Cooper said.
Sen. Paul Newton (R-Cabarrus/Union) said he thinks the top priority should be cutting taxes.
“We think the number one thing we should do is reduce taxes. We clearly are collecting more revenue than we need to from North Carolinians,” he said, pointing to recent surpluses the state has experienced.
Newton proposed cutting the income tax rate from 5.25% to 4.99%. He also wants to increase the standard deduction, which would lead to more people paying no state income tax, and increase the tax deduction for children. His proposal also cuts corporate franchise taxes.
“We think people, individuals, North Carolinians, know how to best spend their money. Government is a poor substitute for you deciding how you want to spend your dollars,” Newton said.
CBS 17 asked Cooper about that proposal.
“I have concerns with it because I think it mostly benefits the wealthy. They’ve proposed an increase in the standard deduction, which I like better, because that helps more middle-income people,” Cooper said. “I think we can find some areas of negotiations in cutting taxes for people. We would rather help people that are on the margins and in the middle class.”
Here are additional highlights of the governor’s budget proposal:
- Provides K-12 teachers 10 percent raises over two years.
- $2,000 bonus for educators in May 2021.
- Ensures all non-certified school employees receive a minimum of $15 per hour.
- 7.5% pay increase for UNC and community college employees over two years plus $1,000 bonuses in Oct 2021 and Oct 2022.
- 5% raise for state employees over two years plus $1,000 bonuses in Oct 2021 and Oct 2022.
- $10.2 million to improve building security, including at the Department of Revenue and the state Supreme Court.
The $4.7 billion bond package would require approval from voters. Cooper wants the bond to be on the ballot this fall, but there’s uncertainty over how elections this year will unfold. The U.S. Census Bureau is delayed in getting data to states to draw electoral districs, potentially pushing elections to 2022.
The bond Cooper proposed includes the following:
- $2.5 billion for public schools to address the over $8 billion in documented needs
- $783 million for the UNC System, including $295 million for health and safety projects
- $500 million for the Community College System
- $430 million for Health and Safety projects across State Government
- $460 million for Parks, Zoos, Museums, and Historic Sites