By GARY D. ROBERTSON, Associated Press
RALEIGH, N.C. (AP) — Republican-backed adjustments to North Carolina’s budget were signed into law by Democratic Gov. Roy Cooper on Monday, ensuring state employees will get slightly bigger pay raises and that construction projects and state reserves will receive billions of dollars. more than originally expected.
The signing marks the second year in a row that he has accepted the GOP state government’s comprehensive spending plan after vetoing budget bills in 2017, 2018 and 2019. The measure changes the bill’s second year of two-year budget bill that Cooper signed last November.
Cooper said the measure included “essential investments in education, economic development, transportation and the state’s workforce.” Cooper also announced that North Carolina’s COVID-19 state of emergency will expire Aug. 15 after nearly 2½ years due to budget wording that gives its health department flexibility to respond to the pandemic.
Cooper had until Monday night — 10 days after the House and Senate gave final legislative approval to their $27.9 billion plan — to sign the bill or veto it, or he would become law without his signature.
Absent from the enacted measure, there is no reference to the expansion of Medicaid, which has been closely tied to Cooper — a big expansion booster — and budget negotiations since 2019. Both the House and Senate have approved separate and concurrent measures in June that either accepted expansion or charted a course. expansion, but no compromise was found.
“Negotiations are ongoing and we’re closer than ever to an agreement on expanding Medicaid, so a veto on this budget would be counterproductive,” Cooper added.
With more than 30 Democratic lawmakers ultimately voting for the deal, Cooper faced pressure from a veto vote by Republicans later this month, which would be successful if just five Democrats stayed with them. .
“We are delighted that Governor Cooper has signed this responsible spending plan,” House Speaker Tim Moore and Senate Leader Phil Berger said in a joint statement. “Moving forward, we are committed to working together to improve access to health care and expand Medicaid, while providing the necessary safeguards to preserve fiscal strength for the state.”
The measure, which covers the year beginning July 1, decides what to do with well over $6 billion in additional revenue by mid-2023 beyond what was projected when the budget was made. biennial.
There is no additional tax reduction beyond the income tax rate cut that the two-year finance law has already provided for this year and next year. Republicans described the measure as designed to keep the state on a solid financial footing amid inflation and worries about a recession.
Not counted among the $27.9 billion, an additional $7.7 billion in reserves and for items such as state government construction and local water and wastewater projects, as well as incentives to try to bring more businesses to North Carolina. These funds will help bring the state’s rainy day reserve to a record $4.75 billion and create a new $1 billion “stabilization and inflation reserve” that could be tapped to cope with the erosion of tax revenues and rising prices.
The adjustments will increase next year’s 2.5% increase for base state employees already in place to 3.5%, while teachers’ average salary increases for the coming school year will rise from around 2.5% to 4.2%, with first-year teachers seeing base salaries of $37,000. Cooper’s May budget proposal sought slightly higher pay increases for teachers and workers.
Also included is an additional $56 million a year in taxpayer-funded scholarships for children to attend private schools — a program Cooper strongly opposes.
The proposal actually spends $1 billion more on K-12 schools, community colleges and the University of North Carolina system than last year, or nearly $16.5 billion. But critics of Republican education policy say lawmakers haven’t fully complied with a judge-approved step-by-step plan to address the state’s education inequities. The state Supreme Court will hear arguments next month on whether courts can transfer money from state coffers to enforce what is known as the Leandro decision.
The budget bill also directs that $193 million in sales taxes be used to help build transportation projects, rather than go into the state’s general fund coffers. The share of sales tax accruing to two road funds would triple by mid-2024.
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