North Carolina Senate’s 2-year budget advances through committees, with floor votes next

RALEIGH, N.C. (AP) — A two-year state government budget proposal penned by North Carolina Senate Republicans advanced through several committees on Tuesday with little resistance from Democrats, who remain opposed to a lot of what’s in it.
The budget bill directs how $29.8 billion would be spent during the fiscal year that begins July 1 and $30.9 billion the following year — the same amounts that were agreed to by House Republicans when they passed their budget plan last month.
But the two chambers’ plans differ on line-item expenses, such as salary increases for teachers and state employees and the depth of income tax cuts, as well as on policy decisions not directly related to spending.
Once the Senate budget is approved by the full chamber later this week, House and Senate Republicans will negotiate a final plan to vote on and present to Democratic Gov. Roy Cooper.
Sen. Brent Jackson, a Sampson County Republican and chief budget-writer described the Senate’s passage of a budget as the second leg of a three-leg race toward enacting a spending plan before the next fiscal year begins July 1.
“And we will get there to the end here shortly, we hope, in the next few weeks,” Sampson told the Senate Appropriations Committee, which recommended the Senate plan unveiled on Monday after approving two amendments.
The Senate’s tax-writing and pensions panels also OK’d the budget proposal later Tuesday. The first of two required floor votes is set for Wednesday.
The Senate budget would offer smaller average raises for public school teachers and smaller raises for rank-and-file state employees compared to what the House proposed.
But the Senate plan would offer sizeable raises to the top elected executive branch officials, including next year alone a nearly 20% raise for the governor and 7.5% pay increase for Council of State members.
On taxes, the Senate wants to ratchet down further the individual income tax rate that current state law will reduce over time to 3.99% by 2027. The Senate plan would reach 3.99% in 2025 and lower it further over time to 2.49% in 2030. The House just wants to tweak current law so that the planned rate in 2024 would be slightly lower. House Republicans also want to increase standard deductions.
Both chambers would set aside billions of dollars for reserves, construction projects and local infrastructure grants.
The Senate proposal also makes a big splash by setting aside $1.425 billion for a proposed endowment operated by the nonprofit organization called “NCInnovation” that would seek to turn research produced at University of North Carolina System campuses into commercial successes, particularly in rural areas.
Legislators have leeway with spending, tax cuts and reserves thanks in part to an estimated $3.1 billion in revenue overcollections this fiscal year.
Senate Democrats questioned some policy and spending provisions in Tuesday’s committee meetings but didn’t offer amendments.
Cooper, who would be asked to sign a final budget bill into law, criticized earlier this week the Senate’s proposed teacher raises as “pitiful” and a large expansion of the state’s program to give taxpayer dollars to families for K-12 students to attend private schools “disastrous.”
With Republicans now holding veto-proof seat majorities, Cooper has less leverage than during the previous four years to influence the ultimate state budget.
And there’s a requirement in a separate Medicaid expansion law that Cooper signed with great fanfare in March that the new health care coverage can’t occur unless a budget is enacted. That may force him to accept spending and policies he dislikes to ensure a budget is approved.