Budget 6-15-07

Budget negotiations between the House and Senate continue, and several large issues remain unresolved. The biggest sticking points between the two chambers appear to be resolving the Medicaid relief issue for the counties and the proposed expiration of the temporary taxes.

The NC Justice Center's Budget and Tax Center released a report (pdf) this week that analyzes and compares the two competing plans and how they fare in terms of working families and fiscal responsibility. The report concludes: "The Senate Budget is all around less responsible than the House or Governor's versions. It provides less funding for programs that would benefit working families across the state. It is less fiscally responsible by relying on one-time money to pay for ongoing expenses, allowing the two temporary tax provisions to expire, and using less of the onetime to build the Rainy Day Fund, finance capital improvement projects, and payback the state pension system. It drives up the state's responsibility for paying off debt by issuing $1.2 billion in certificates of participation to primarily finance university projects."

Funding prospects on key environmental programs are looking better. The Natural and Economic Resources Conference Subcommittee on which I sit approved a budget that recommends funding at the House level ($615,000) for emergency drinking water supplies, notification, and testing for low income communities. Farmland preservation is back in at slightly less than $1 million (Governor had proposed $5 million, House- $8 million, Senate-$0). We hope to resolve this at a level closer to the House proposal. The House and Governor are committed to maintaining the State Energy Office (Senate budget had proposed eliminating the office).

Budget chairs are meeting quite frequently with the hope of resolving any outstanding issues in time to have a budget in place by July 1, 2007.