On Wednesday, May 30, the North Carolina state Senate, by a 36-to-14 vote, gave initial approval to the 2018-2019 budget, which includes pay raises for teachers and state employees and tax cuts for citizens and corporations.
The initial Senate vote on the budget passed with all Republicans and one Democrat voting in favor.
The budget is expected to pass both the state Senate and state House by Friday.
It would appear to be a budget everyone could support, but it will most likely pass the state Senate and state House on mostly party line votes, be vetoed by Gov. Roy Cooper and then the state Senate and House will override the veto and the short session of the legislature will pretty much be over.
In odd numbered years, the state legislature passes a two-year budget, and in even numbered years, the legislature goes back to Raleigh for a short session where the two-year budget is revised, but not rewritten.
The good news about this budget is that while lowering taxes the state continues to raise more money, which means the state could give more raises and fund more programs. If there were any fairness in the world, the mainstream newspapers in the state would be running huge apologies on the editorial pages, but don’t expect to any apologies or corrections, even though there is now proof that the Democrats and their colleagues in the mainstream media were wrong about taxation and the Republicans were right.
When the Republicans took over the state government in 2011 and announced they were going to cut corporate and personal tax rates drastically, the Democrats, including their colleagues in the mainstream media, said that huge spending cuts had to be made to make up for the lost revenue.
The Republicans said that the tax cuts would result in more, not less, revenue, because the tax cuts would spur economic growth. The increased economic activity would result in more people paying more taxes even with the lower rates because they were making more money.
At the corporate level the lower tax rate according to Republicans would attract new industry and cause existing industries to expand so their would be more revenue because more corporations would be paying the lower taxes and the corporations that were here would pay more because they were making more money.
The Democrats accused the Republicans of using trickle down or voodoo economics and said that lower tax rates would result in the state not having enough money to pay its bills.
The Republicans turned out to be right and the Democrats wrong. This budget proves that the Republican economic plan to lower taxes and create increased economic activity has been wildly successful.
In this new budget, teachers will receive an average of a 6.5 percent raise, which means, since 2013-2014, teacher salaries have increased an average of 20 percent. Under the much higher taxes of the previous Democratically controlled government, teacher salaries were lowered twice. It doesn’t make any sense that the teachers’ union supports Democrats that lowered their salaries and opposes Republicans that have given them a 20 percent raise in the past five years.
State employees are getting a 2 percent raise, and all full-time and benefitted state employees will have a yearly salary of over $31,000, which is $15 an hour. The Democrats on the Greensboro City Council have made a huge deal out of raising city employees to $15 an hour. But the Republicans in the legislature are doing the same thing without all the fanfare.
One of the factors that led to the Democrats lowering teacher salaries is that under the Democrats the state spent everything as fast as it came in the door, so when the economy took a downturn there was nothing to fall back on. The Republicans have not only paid off the billions in debt that the Democrats had run up, but the state now has over $2 billion in a rainy day fund to help the state make it through tough economic times without resorting to taking money away from teachers.
Teachers marched on Raleigh to protest against the Republicans who were giving them a 6.5 percent salary increase. Can you even imagine what teachers would do if the Republicans cut teacher salaries like the Democrats did?
The state budget also provides more money for school safety. The total budget for textbooks was raised by $12 million to $74 million. That is an increase of $71 million from the last budget passed by the Democrats.
The starting pay for the North Carolina Highway Patrol has been raised to $44,000 and state correctional officers received a 4 percent increase.
And then there are the tax cuts. Personal income tax will be lowered in 2019 from 5.5 percent to 5.25 percent. The goal is to continue to lower personal income tax in the state until it is eliminated.
Corporate income tax is being lowered in 2019 from 3 percent to 2.5 percent.
It’s worth noting again that the money for raises and increased spending in education was the result of lowering the personal and corporate tax rate and increasing economic growth. Under the Republican tax plan North Carolina was recently rated by Forbes as having the best business climate in the country.
To further that economic development the budget also creates a special tax incentive plan for corporations who invest at least $1 billion in the state.
The budget allocates $10 million to deal with the GenX water contamination problem and $3.5 million to improve the state’s wastewater and drinking water infrastructure. That $3.5 million will result in $15 million in federal funding coming to the state.
In the $24 billion budget it’s barely a drop in the bucket, but Jamestown, Pleasant Garden, Oak Ridge and Summerfield all received $50,000 for downtown and economic development.
Oak Ridge Town Councilmember George McClellan said that the $50,000 would be a big boon to Oak Ridge and added that District 27 State Sen. Trudy Wade was responsible for getting that funding in the budget. He said, “We have Trudy Wade to thank for this.”
Guilford County also received $50,000 for a pilot program on the opioid problem.