Friday, March 16, 2007

Budget Update

Members of the House and Senate continue their discussions this week about the two-year state budget, which will set spending levels for state programs such as our public schools, universities, community colleges, health care system, and roads. As a reminder, the House and Senate will pass their own budget proposals over the next few months, in hopes of working out the differences and passing a final budget before the start of the new fiscal year on July 1, 2007. We are currently considering spending recommendations by Governor Easley, individual lawmakers, and advocacy groups. We are also going through the various state programs to determine what can be eliminated or made more efficient.

Members of the House and Senate finance committees also received a briefing from State Treasurer Richard Moore, who described his office's debt affordability study and urged lawmakers to keep North Carolina's high bond rating and financial security by issuing bond funding conservatively. Several legislators and groups across the state have called for passage of bond packages related to school construction, water and sewer improvements, protecting land and open spaces from development, and road construction. During questioning, Moore told lawmakers they can issue more than the report's recommended $384 million in new debt each year over the next decade if they find a way to match any increase with new revenues that maintains the recommended 4 percent ratio of debt service to revenue.

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