State Politics

Legislative leaders set budget target that spends less than McCrory wanted

State Budget Director Andrew Heath gives details of the N.C. governor's 2016-17 state budget during a press conference Friday morning, April 22, 2016, at the North Carolina National Guard Joint Task Force headquarters in west Raleigh.
State Budget Director Andrew Heath gives details of the N.C. governor's 2016-17 state budget during a press conference Friday morning, April 22, 2016, at the North Carolina National Guard Joint Task Force headquarters in west Raleigh. hlynch@newsobserver.com

State House and Senate budget writers have agreed to a $22.225 billion spending limit for the coming fiscal year – an approach that will spend less than Gov. Pat McCrory’s proposal.

Rep. Nelson Dollar and Sen. Harry Brown announced the figure Wednesday afternoon. It represents a spending increase of 2.26 percent over the current budget. McCrory’s $22.8 billion budget would have been a 2.8 percent increase. That could make it difficult for legislators to find funding for the average 5 percent raise McCrory wants for teachers. And state employees hoping for more than the average 3 percent bonus in the governor’s plan could be disappointed.

“This fiscally sound and sustainable spending target will enable us to fund our shared priorities without repeating the excessive spending binges we saw under Democrats – and it is an important step to quickly passing a final budget,” Dollar and Brown said in a joint statement.

The House and Senate haven’t yet announced details about their budget plans. House budget subcommittees have been meeting this week, and Dollar has said he hopes to have his chamber’s proposal ready in the coming weeks.

Agreeing on a spending target early in the process could help avoid the lengthy budget impasse lawmakers faced last year, when the final budget wasn’t approved until nearly three months after the fiscal year began.

In 2015, the House passed a budget that increased spending by 5 percent, while the Senate’s budget bill had a 2 percent spending increase. It took weeks of negotiations to arrive at a $21.74 billion budget target, which was a 3.1 percent increase.

This year’s budget will bring a smaller increase in state spending, and the decision drew praise from the conservative Americans For Prosperity.

“The lead appropriations chairs, Sen. Harry Brown and Rep. Nelson Dollar, are commended for keeping spending levels low so that taxpayer priorities are funded first, preventing waste and excessive spending while sending real tax relief home to citizens and small businesses,” state director Donald Bryson said in a news release.

But the liberal N.C. Budget and Tax Center warned that the spending limit could make it difficult to adequately fund schools and other needs.

“Setting an arbitrary spending target without discussing the unmet needs in communities isn’t good budgeting or fiscally responsible,” said the center’s director, Alexandra Sirota. “The reality of what a growing state and an innovative, inclusive economy needs can’t be measured by flawed formulas but must be arrived at through careful consideration of the challenges and opportunities North Carolina must address.”

Colin Campbell: 919-829-4698, @RaleighReporter

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