RALEIGH, N.C. (WNCN) – Republicans in the General Assembly are moving forward with votes this week on a state budget that will cut taxes for people and businesses and give pay raises and one-time bonuses to state workers, as Gov. Roy Cooper (D) weighs whether to sign it.
New details of the budget agreement were released Monday ahead of the first vote in the Senate on Tuesday.
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 COLA bonus over two years, which is not a permanent COLA.
-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.
The budget would total $25.9 billion this fiscal year and $27 billion next fiscal year.
“It really does show a lot of compromise on all sides, folks meeting in the middle and getting to a place where most feel comfortable,” said Rep. Jason Saine (R-Lincoln County).
Suzanne Beasley, government relations director for the State Employees Association of North Carolina, said some state workers have grown frustrated waiting for this process to get resolved. Some are even leaving state jobs, she said, as private companies offer enticing incentives.
“Everybody’s tired of waiting. It’s been a long time since they’ve had any kind of pay increase. They’ve worked through the pandemic,” she said. “It’s more important than ever that the legislature and Gov. Cooper go ahead and get a budget done.”
North Carolina is the last state in the country to adopt a budget. During the last two-year legislative session, Republicans and Democrats never could reach an agreement.
This time, Gov. Cooper has met behind closed doors with Republicans as they’ve tried to find a compromise out of the public eye.
They never did come together on a budget proposal that Cooper would sign. The governor said last week he hasn’t made up his mind whether to sign the budget lawmakers are likely to send him this week. He noted the talks led to increased funding for education but not Medicaid expansion.
Cooper could sign the budget, veto it or allow it to become law without his signature.
In response to various questions about the budget plan, Cooper spokesperson Jordan Monaghan said, “The Governor and his staff are reviewing the budget.”
Republicans believe they have enough support from Democrats to override a veto if Cooper issues one.
“To me, it reminds me of a Democratic budget in the 90s,” said Rep. Billy Richardson, a Democrat from Cumberland County who’s going to vote in favor of the budget passing. “It’s asinine for a legislature to be so at odds with each other and so unwilling to compromise that we not have a budget.”
The budget plan also includes a new salary supplement for teachers that is paid by the state. It’s targeted to “low-wealth” counties, aiming to help them compete with larger counties in recruiting and retaining teachers.
To see a county-by-county breakdown of how the program would work, click here.
The program would not apply to the following counties: Wake, Mecklenburg, Guilford, Durham and Buncombe.
Sen. Wiley Nickel (D-Wake) reiterated many of the concerns he’s had throughout the last several months as the General Assembly debated the Republicans’ budget proposals.
“They want more money for tax cuts for corporations and the wealthy. And, they want to take that money off the table for the next decade,” he said. “And, if we give away all that money for tax cuts we don’t have enough money for our kids and our schools.”
The budget plan also includes some policy-related provisions that have been controversial recently. Among them, there would be limits on the governor’s emergency powers beginning in 2023. The governor would have to seek concurrence from the Council of State for emergencies lasting longer than 30 days. The council is currently made up of six Republicans and four Democrats, including Gov. Cooper.
Atty. Gen. Josh Stein (D) would also be limited in his ability to enter into certain legal settlements, such as the one that changed the rules of the 2020 election. Gov. Cooper has vetoed bills dealing with those issues.
The budget does not include some school-related policy provisions that Republicans in the House had sought, including that teachers be required to post their lesson plans online so they can subject to scrutiny by the public.
The Senate will vote on the budget Tuesday and Wednesday, with the House expected to take votes Wednesday and Thursday.
The full budget document has not yet been posted online.