Shortly after midnight this morning, the N.C. House approved its 2010-11 budget proposal. You can read the bill language here, and the money report here.
A few preliminary observations:
- The media is reporting that the House spending plan totals $18.9 billion. This is misleading and does not represent actual spending on state programs. The $18.9 billion does not count $1.04 billion in American Recovery and Reinvestment Act (ARRA) – or the federal stimulus act – already embedded as cuts via last year’s two-year spending plan. That is money counted as a “cut” in the state budget, but backfilled by the federal dollars. The House’s recommended adjustments for 2010-11 include another $579 million in “cuts” that are also merely funding shifted to the feds. The $579 includes $490 million in Medicaid dollars not yet approved by the U.S. Congress, so that money may not actually materialize. All told, the spending on state programs including the federal funding comes to about $20.5 billion.
- Due to a current year shortfall, the 2009-10 budget year will likely see actual appropriations (including federal funds) of about $20 billion. Thus, the House proposal would mark a half billion dollar increase in year-over-year spending, or about 2.5%. So much for all the “drastic cuts” we keep hearing about.
- The House plan would raid $127 million in additional lottery funds to reportedly preserve 1,600 teacher positions.
- Teachers and state employees would see their salaries frozen
- The House plan also raids 8 “special funds” in order to help balance their budget
- $70 million in non-voter approved new debt is authorized in the House budget for “repairs and renovations” for state buildings
In related budgetary news, the Senate approved its $451 million bond package, and it now moves on to the House for approval. Read more about why this is an irresponsible move here.
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