Below is a high level summary and an in-depth look at the state budget for the upcoming biennium which was approved by the General Assembly this week. The section highlights are broken down by appropriation area, i.e. Education, Health and Human Services, Taxes and Economic Development, Agriculture, etc. The purpose of this special newsletter is to give you a breakdown of the major budget changes that our state will use to operate for the next two years.
I always appreciate your feedback, so feel free to reply.
—Sen. Chad Barefoot
A bipartisan General Assembly passed a roughly $23 billion state budget this week that will help dramatically increase teacher pay and improve public education outcomes, rebuild communities devastated by Hurricane Matthew and provide major tax relief to strengthen the middle class and North Carolina’s economy.
Under Republican legislative leadership, the state has seen hundreds of millions of dollars in budget surpluses – and billions in savings reserves – through tax relief and balanced budgeting that helped spur economic growth. Under previous leadership, North Carolina faced teacher pay cuts and furloughs, as well as historic budget deficits, despite Democrats raising sales tax rates in 2003, 2005, 2007 and 2009.
The 2017 compromise budget increases spending by three percent over last year’s budget and focuses that increase in key areas, like providing nearly $700 million more for public education
As a co-chairman of the Senate Education Appropriations Committee, I worked with Sen. David Curtis (R-Lincoln) and Sen. Michael Lee (R-New Hanover), as well as the co-chairs of the House Education Appropriations Committee, to craft a budget that brings the state’s total public education budget to $13.53 billion, including over $9 billion for K-12.
Senate Budget Highlights
In Education –
· Keeps the plan to dramatically increase average teacher pay from last year’s budget, investing more than $100 million in the first year alone. This is in addition to the substantial teacher pay raises legislators passed in 2014, 2015, and 2016.
· Includes a new plan to let highly-qualified new teachers begin at a higher pay grade on the salary schedule, providing financial incentive to those who accept positions in low-performing schools, are licensed in special education or STEM classes, or meet other criteria.
· Provides $35 million to substantially increase principal and assistant principal pay, including funds for performance bonuses for principals.
· Includes $10 million in additional compensation for community college employees.
· Provides a bonus for teachers with 25 or more years of experience in each year of the biennium.
· Includes roughly $25 million to expand a performance-based bonus program to top-performing 4th and 5th grade reading teachers and 4th-8th grade math teachers, based on EVAAS growth scores.
· Allocates $10 million over two years for a bonus program for veteran teachers with more than 25 years of experience.
· Fully funds K-12, community college and public university enrollment growth.
· Allocates funds for grants to economically struggling, rural counties to assist with critical public school building needs.
· Invests an additional $11 million in textbooks and digital resources and increases funding for children with disabilities.
· Restores funding for the Governor’s School.
· Restores funding to Eastern North Carolina STEM.
· Expands the teacher assistant tuition reimbursement program to 14 additional counties, which provides tuition reimbursement for up to 5 TAs per district to pursue a college degree leading to teacher licensure.
· Supports the new N.C. Teaching Fellows Program through the N.C. Education Endowment Fund.
· Reimburses graduates of a North Carolina educator preparation program for the administrative cost of obtaining a teaching license. The current fee is $70.
· Establishes the Future Teachers of North Carolina program to encourage high school students to consider teaching as a career.
· Expands the North Carolina New Teacher Support Program to include more beginning teachers.
· Protects the Read to Achieve, Teach for America, and Communities in Schools programs from being cut by the Department of Public Instruction to fund bureaucracy.
· Provides additional assistance to community colleges for workforce training programs.
· Provides for the transfer of the ApprenticeshipNC program from the Department of Commerce to the NC Community College System and increases funding for the program.
· Honors the commitment to fully fund the N.C. Promise Program, which guarantees in-state undergraduate students at three schools across the state pay just $500 per semester for tuition.
· Includes over $18 million in new funding for medical education, including funding increases to the UNC School of Medicine and to the school’s Asheville campus.
· Provides additional stabilization funds to Elizabeth City State University to help get the school on solid financial ground.
· Directs $1.5 million to the Cheatham-White Scholarship Program, which will provide state matching funds for up to 20 scholarships at both North Carolina
· Provides funds to support already-established doctoral programs at NC A&T University. These funds will support new faculty and graduate student services for the doctoral programs, including computer science, various engineering fields, energy and environmental systems, education, and rehabilitation counseling.
· Allows senior citizens to audit courses at the University of North Carolina or North Carolina Community Colleges for free, provided that they have permission from the instructor and there is space available in the course.
· Establishes the Personal Education Savings Account (ESA) Program for children with disabilities. Eligible students will receive up to$9,000 for use by the student’s parents on expenses such as: tuition and fees at a nonpublic school; textbooks; tutoring; fees for exams; educational therapies; educational technology and transportation. Eligible students with certain severe disabilities may combine an ESA award with the existing Children with Disabilities Scholarship.
In Salaries and Benefits –
· Provides a $1,000 salary increase to state employees.
· Offers experienced-based step increases to teachers, State Highway Patrol troopers, clerks and magistrates.
· Provides $10 million in the biennium toward hard-to-hire positions across state government, such as health care technicians and nurses.
In Health and Human Services –
· Provides more than $27 million over two years to add 3,525 new pre-K slots – eliminating 75% of the waitlist for at-risk children.
· Upgrades the Controlled Substance Reporting System that will use advanced analytics to detect and fight prescription drug abuse.
· Allocates $15 million over two years to community health centers, rural health centers, free clinics and other health services providers in rural and underserved areas that assist the uninsured.
· Invests $18 million to improve North Carolina’s child welfare program, including new training and prevention programs, and nearly $4 million to improve accountability and oversight of the system.
· Earmarks close to $3 million to provide support for additional foster children in the system.
· Continues preparing for the transition to Medicaid reform by allocating $75 million over two years to grow the Medicaid Transformation Reserve.
· Includes more than $12 million for 400 new innovation waiver slots for people with intellectual and other related developmental disabilities that are at risk for institutional care.
· Designates $10 million for opioid and substance abuse treatment statewide.
· Allocates $19 million from the sale of the Dorothea Dix property to fund behavioral health beds.
In Justice and Public Safety –
· Strengthens laws against human trafficking and funds signage to increase awareness of the warning signs of trafficking.
· Funds needed additional positions in the state court system, including new deputy clerks of court and assistant district attorneys.
· Provides more than $4 million for law enforcement training for North Carolina officers.
In Taxes and Economic Development –
· Reduces the tax burden on North Carolina families and small businesses by cutting the personal income tax rate from 5.499 to 5.25 percent in 2019, and by increasing the amount of income that is exempt from state income tax.
· Lowers the corporate income tax rate from 3 percent to 2.5 percent in 2019, continuing the business tax reforms that have helped create more than half a million new jobs since Republicans took control of the state legislature in 2011.
· Simplifies and reduces the franchise tax on small businesses by cutting what is effectively a statewide property tax on small businesses and creating a flat $200 tax on the first $1 million of a business’s net worth.
· Provides over $4 million to support tourism advertising as well as domestic and international advertising to promote economic development.
· Allocates close to $4 million for revitalization grants in towns and cities across the state.
In Agriculture and the Environment –
· Increases funding for the Clean Water Management Trust Fund, the Tobacco Trust Fund and the Agricultural Development and Farmland Preservation Trust Fund.
· Expands support for the aquaculture industry and provides additional funding for dredging to ensure valuable economic activity at the North Carolina coast can continue.
· Allocates over $750,000 to expand international marketing of North Carolina agricultural products.
· Provides funding for engineers to improve dam safety and review emergency action plans to help prevent catastrophic flooding.
· Sets aside $2.3 million to purchase a new firefighting aircraft in the wake of devastating wildfires in Western North Carolina.
· Provides $250,000 to the Department of Agriculture to continue fighting against federal overreach in the form of the new Waters of the United States definition after the Cooper Administration withdrew from the federal lawsuit challenging this unprecedented land grab.
In Transportation –
· Increases funding for the Strategic Transportation Investments Program (STIP) by $320 million over two years, which will allow 100 new highway projects to be added over a ten-year period.
· Includes $241 million to improve structurally deficient bridges across the state, adds $143 million to improve the condition and safety of existing roads, increases contract resurfacing by $20 million and increases funding for pavement preservation by $30 million, extending the life of thousands of miles of roads.
· Invests $100 million to fund immediate need construction projects across the state that improve mobility and safety, reduce congestion and spur economic development.
· Includes $208 million over two years for a Roadside Environmental Fund dedicated to ensuring the safety and beautification of the state’s highways.
· Modernizes the state’s transportation network by providing additional funding to airports across the state for infrastructure improvements, and to the State Ports Authority for infrastructure and dredging needs.
· Brings the rainy day fund to $1.838 billion, or 8.2 percent of last year’s budget – the largest dollar amount and percentage in state history.
· Adds $125 million to make needed repairs and renovations to state and university facilities.
· Helps preserve North Carolina’s military operations by allocating $2 million for the next Base Realignment and Closure (BRAC).
· Continues the commitment to improving government transparency by funding a website that makes every state agency, county, and local school district budget available for citizens to view online.
· Aims to make government operations more efficient by investing in a fully-consolidated statewide Enterprise Resource Planning system.
· Helps the office of the State Auditor conduct more specialized audits and allocates funding to assist the state Department of Revenue in identifying and preventing tax fraud.
Senator Chad Barefoot represents District 18 containing Franklin County and portions of Eastern and Southern Wake County. Senator Barefoot is a Chairman of the Education Appropriations and Education Policy Committees and also serves on the Appropriations/Base Budget, Finance, and Rules and Operations of the Senate Committees.
From The Office of NC Senator Chad Barefoot
NC Senate * 300 N. Salisbury Street, Room 406 * Raleigh, NC 27603-5925 *
919-715-3036 * chad.barefoot@NCLEG.NET