The General Assembly's 2010 short session starts this week with more budget cuts topping the agenda. Revenues from existing taxes continue to sag as people earn less and spend less. The nonprofit N.C. Budget and Tax Center estimates that if state services were the same as before the recession, the proposed 2010–11 budget would be $23.1 billion. Instead, Gov. Bev Perdue's budget calls for $19.1 billion, and with federal stimulus funds added her budget totals $20.8 billion.
Overall, the tax center reports state spending has been reduced by 10 percent since the recession began two years ago.
Behind the numbers, there are real cuts to programs. For example, there were funded salaries for 4,700 fewer teachers last year than in 2008, according to June Atkinson, the state Superintendent of Public Instruction—the first time she can remember that happening. (The number dropped from 86,447 teachers statewide to 81,746.) This year, more pain is in store as Perdue seeks to lop another $315 million out of K–12 school budgets—about 4 percent of the more than $7 billion the state spends on public schools.
Public schools, the community colleges and the UNC system account for 60 percent of state spending. They've borne the biggest reductions. But health and human services programs (21 percent of state spending) and the courts, prisons and law enforcement (11 percent) have been hit, too.
In every area, a dollar (or $1 million) cut from the budget today may cost more in the future: The teacher not paid can mean students not helped; the environmental officer eliminated can mean a polluter not cited; the community nonprofit not funded to help ex-offenders can translate to more crime—and more repeat offenders who end up behind bars at taxpayers' expense.
Perdue is well aware that programs like Harriet's House in Raleigh, a re-entry program for ex-offenders, are worth supporting. In fact, her StreetSafe Task Force is studying how to start more such programs. But in the current crunch, Harriet's House, which in previous years received $275,000 in operating support from the state, was zeroed out by the governor—and is fighting for its life with legislators.
The 2010 election—and the aftermath of the Citizens United Supreme Court decision—is a prime time to examine campaign finance and ethics reform. A bill addressing public financing of elections is a holdover from last session; expect ethics reformers to pressure lawmakers to curb the influence of money on policy making.
Other bills are expected to sprint through the short session, if not to pass, then at least to get in line for next year: a telecom-backed measure that would prohibit communities from building their own broadband networks and a bill that would crack down on puppy mills by requiring inspections of certain facilities. In light of the BP disaster in the Gulf, a committee analyzing the impacts of offshore drilling will issue its findings this month. In an election year, it is unlikely that lawmakers will raise taxes. However, they are mulling whether to regulate and tax Internet sweepstakes cafés—essentially video gambling joints with fax machines that have found a loophole in the law—instead of banning them.
The Indy will be monitoring these bills—and more—over the next two months.
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