Today’s Durham Herald-Sun includes my piece discussing two items I believe should be at the top of state lawmakers’ priority list. A slice:
If the new majority is serious about controlling spending they will first adopt what is commonly known as a Taxpayer Bill of Rights, or TABOR. The basic premise of a TABOR is to tie the annual growth of state spending to equal the rate of inflation plus population growth.
If such a built-in spending restraint had been in place during the past few years — instead of desperately grasping at billion-dollar tax hikes and billions more in federal stimulus funds — North Carolina budget writers would have been asking “what budget gap?”
The second piece of legislation desperately needed to get North Carolina’s fiscal house in order is a legal requirement to ensure that all new state debt receives voter approval. Thanks to a funding mechanism known as Certificates of Participation (COPs), the state has been able to circumvent voter approval for new state debt since 2000.
Unsurprisingly, without this accountability measure North Carolina’s state debt has exploded. Per-capita state debt has more than doubled in less than a decade, annual payments to pay down the debt have more than tripled, and the State Treasurer’s Office has warned that the state’s bond rating is in jeopardy if it continues to skirt voter approval for new debt.
Certainly, an examination of North Carolina’s long-term spending growth suggests there needs to be some legally-imposed restraint put upon the spending appetites of state lawmakers. They surely haven’t proven they can restrain themselves.
Furthermore, the idea of issuing state debt without consent of the voters (the very ones who will have to pay back the debt) is insulting. Lacking any accountability, state lawmakers have embarked on a reckless borrowing spree – even during years the state was raking in billions in surplus revenue.
Both of these measures would only be effective as amendments to the state constitution – which would mean they would ultimately be decided on a vote of the people. Past Civitas Institute poll results indicate strong public support for both of these measures. The Dec. 2009 poll revealed that voters supported a TABOR amendment by a margin of 54% to 24%. And when asked in the May 2008 poll, a whopping 77% of respondents said the General Assembly should not be allowed to issue new state debt without voter approval, compared to only 14% who said they should be allowed.