Today the State Employee’s Association of North Carolina (SEANC) held a press conference touting their new report entitled: “Take Pride in North Carolina: A Budget Report Containing $10 Billion in Savings.” The report can be found here.
The report contained some good, and some not so good, suggestions. And make no mistake, very few of their recommendations involve “savings.”
On the plus side, the report aggressively goes after corporate welfare programs and targeted tax credits – something that Civitas has been addressing for years. The report also advocates for dissolving Golden LEAF and transferring its funds into the state’s General Fund. Of course, these are not actual savings, but increasing revenue. The report also recommends privatizing liquor sales – and estimates a one time windfall of $800 million to state government.
More recommendations include extending the “temporary” taxes, increasing the tobacco tax and expanding the franchise tax to LLC’s. These three suggestions are estimated to bring in nearly $2 billion in additional revenue. There is also a number of mentions for “drawing down” federal funds to set up a health insurance exchange and for additional Medicaid dollars. Unfortunately, this would involve the state spending more money in order to “draw down” federal funds – so I am not sure how that equates to savings.
The only actual significant “savings” offered up in the budget involve switching to a 4-day work week for state employees and creating a voluntary unpaid fulough program. These two measures are estimated to yield $850 million in savings and I believe should be given serious consideration by state budget writers.
Overall, the SEANC report (unsurprisingly) mostly offers up ways to enhance revenue to the state through tax increases, seizing other funds and drawing down federal funds (which North Carolinians must pay for through federal taxes anyway). Claiming in the title that the report includes “$10 billion in savings” is highly misleading. However, there are a handful of suggestions in the report worthy of consideration.