03/05/07 — Legislators pick apart proposed '07 budget

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Legislators pick apart proposed '07 budget

By Matthew Whittle
Published in News on March 5, 2007 1:56 PM

Local legislators began diving into Gov. Mike Easley's proposed 2007-09 budget this week as his staff presented the details to a joint meeting of the House and Senate appropriation committees Tuesday and the individual sub-committees Wednesday and Thursday.

This year, the House is responsible for beginning the General Assembly's budget process, and now that representatives have the governor's proposals in hand, they're ready to get down to work.

"We're starting today," Rep. Russell Tucker, D-Duplin, said Wednesday.

"This is a long process," Larry Bell, D-Sampson, added. "What we're going to be doing right now, is sort of prioritizing (the governor's line items)."

And so far, Wayne and Duplin's legislators said, even though they're still trying to wade through the proposal, there are several items that have caught their attention.

"It's like any budget," Rep. Van Braxton, D-Lenoir, said. "There's some good things in it and there's some things I disagree with in there."

Among those eye-catchers were proposals to keep the temporary quarter-cent sales tax and the temporary quarter-cent income tax on the highest earners on the books.

Both were originally temporary two-year taxes passed in 2001. The sales tax was set to expire on July 1, 2007, and the income tax in 2008.

"I think it's wrong to suggest a sunset on a tax and then not do it," Braxton said.

He added that he doesn't mind a higher sales tax, but that income taxes should then be cut accordingly.

"Higher income people buy more expensive items, so their share is more. Lower income people don't buy as much, so their portion is less," he said. "But if you're going to (raise the sales tax) you need to back off the income tax."

There is a proposal in the governor's budget to reduce income taxes for about 12,500 poor families.

However, the cap on the state's gasoline tax also is set to end on July 1. If it does, that tax will increase from 29.9 cents per gallon to 30.4 cents per gallon.

And while Rep. Louis Pate, R-Wayne, thinks it's likely the cap will be extended, he noted that there are no guarantees.

But Pate was happy to see Easley's budget continuing to fund education -- public schools, community colleges and universities -- at high levels. For him, education is a main concern.

As part of that, however, the governor wants to redirect a larger portion of lottery revenues away from school construction and scholarships to pre-kindergarten programs like More at Four and class-size reductions in the early grades.

For many, that is not a popular proposal.

"My idea in the beginning about the lottery money was to do capital outlay for our schools and I had to swallow part of that in the compromise to get it passed," Tucker said. "I do not want to vote to change the distribution methods and the programs it goes to."

Fellow Duplin County delegate, Sen. Charlie Albertson, also said he would be opposed to any changes to the lottery system, including larger payouts in an attempt to get more people to play.

"I don't like going back and doing more things to entice people to play the game. I'd be opposed to that," Albertson said. "Probably the best thing to do is to leave it alone."

Others areas of education that House members will be focusing on, Pate and Bell added, are the governor's proposals regarding increased grants for students in families living under 300 percent of the poverty level, school technology and connectivity funding, the literacy coaches introduced into the middle schools last year and school construction.

"My main concern is education," Pate said.

And with about $11.6 billion devoted to schools, he and others said, it seems to be a strong education budget.

Other areas of local concern that made it into the budget were water and sewer infrastructure for Sen. John Kerr, D-Wayne, prisons for Braxton and farmland conservation for Albertson.

Right now, about $250 million has been budgeted to help pay for the state's water and sewer infrastructure needs.

"It's a start. We need to do better," Kerr said. "That was my No. 1 thing -- to keep the fire burning on water and sewer because we've got serious problems in eastern North Carolina.

In terms of the state's prisons, Braxton noted that while Neuse Correctional Facility is scheduled to receive a dozen new staff members, what it really needs is another dormitory.

He also said he was disappointed in the lack of Medicaid relief for the counties in Easley's budget.

"I think the legislature will have to do something about that," he said.

Local legislators also were disappointed to see money being taken once again out of the Highway Trust Fund to pay for general budget line items.

"We did it before and we've been paying back what we got from it," Albertson said. "I'd be opposed to us doing that again."

And really, he added, it's the responsibility of the General Assembly to be coming up with a budget in the first place.

But, Kerr said, with the ink still wet on the governor's proposals, such differences of opinion aren't unusual or surprising.

"We're a well-run state and I think this is an aggressive budget and a balanced budget," he said. "We'll get with the House and the governor and just try to figure it out and work with each other.

"A lot of these negotiations are just posturing. This is just the first round. Don't get too concerned -- all's well that ends well. We can't do everything, but I hope we can deliver on what the state needs."