NC budget: Positive short-term, threatening long-term

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RALEIGH (June 22, 2017) – At first glance, the budget compromise unveiled this week by legislative leaders seems encouraging.

It would grant K-12 public school teachers an average raise of 3.3% this year and 9.6% over two years.  It would give significant raises to K-12 principals, a priority of the group BEST NC.

It would give most other state employees a flat raise of $1,000, set aside funds for growing university and community college enrollment, and partially restore the NC Teaching Fellows to offer incentives for students to become desperately needed teachers.

With a $580 million surplus this year, legislators managed to avoid further “management-flexibility” cuts to our public universities in the first year of the two-year budget.  They plan admirable investments in the UNC and ECU Schools of Medicine, but a political, punitive cut to the UNC School of Law.  They also dropped a proposal from the Senate to eliminate state funds for the Governor’s School for gifted high-school students.

Yet at a time when North Carolina still hasn’t recovered to pre-recession levels of spending per student, nearly $530 million in tax cuts would take effect the second year of the budget and could jeopardize the state’s ability to get there – as well as Gov. Roy Cooper’s efforts to raise NC teacher pay to lead the Southeast in three years and reach the national average in five.

Because of the tax cuts and restrained education spending, Cooper called the budget “irresponsible.”

He warned that the tax reductions “will blow a major hole in our budget just a few years down the road, handcuffing our ability to invest in education and the economy.”1

The budget does provide $40.6 million for raises of approximately $1,000 for university faculty and staff.  But at a time when 11 of our 16 university campuses fall below the median faculty salaries paid by their peer institutions2 and student debt among NC public university graduates is approaching the national average,3 North Carolina can do better than this.

Among other details, the budget would:

  • Increase state spending 3.1% over the 2016-17 budget, to $23.0 billion;
  • Make most tax cuts take effect in 2019. The reductions would amount to $6.9 million in 2017-18, but balloon to $521.8 million in 2018-19.
  • Provide $125 million for repairs and renovations of state buildings; 50% would go to the University system, $10 million of it reserved for renovation of West Hall at UNC Pembroke;
  • Deposit $263 million in the state’s Rainy Day Fund, bringing the total in the fund to $1.84 billion.
  • Increase University spending $92 million in 2017-18 and $116 million in 2018-19;
  • Increase Community College spending $54 million in 2017-18 and $74 million in 2018-19.4

University Items

  • $47 million for University enrollment growth in 2017-18 and $95 million in 2018-19.
  • $51 million – an increase of $11 million – to support increased enrollment at Western Carolina University, Elizabeth City State and UNC Pembroke under NC Promise, which will offer $500 tuition for in-state students starting in fall 2018.5
  • $6 million in 2018-19 to partially restore the NC Teaching Fellows – forgivable loans of as much as $8,250 per year for students who agree to teach in STEM and special education fields.
  • No management flexibility cuts to the University system in 2017-18; $7 million in 2018-19.
  • $1 million for Faculty Recruitment and Retention Fund; the UNC Board of Governors requested $3 million.
  • $500,000 (4%) cut from UNC Chapel Hill School of Law.  The Senate threatened a $4 million cut.
  • Additional $8 million in 2017-18 and $7.6 million in 2018-19 for UNC School of Medicine Asheville Campus.
  • $1 million in 2017-18 and $9 million in 2018-19 for UNC General Administration data analytics.  The Board of Governors requested $10.75 million in 2017-18 and $19 million in 2018-19.
  • $6 million in operating funds for the Beaver College of Health Sciences at Appalachian State University and other university buildings due to come online in 2018-19.
  • $5.1 million for a Food Processing Innovation Center at the NC Research Campus in Kannapolis.
  • $2 million for NC State University collaborative effort to develop biopharmaceutical manufacturing processes.
  • $2.5 million to support existing doctoral programs at NC A&T State University.
  • $4 million in recurring funds to stabilize Brody School of Medicine at East Carolina University.
  • $2.8 million in 2017-18 and $2 million in 2018-19 to stabilize Elizabeth City State University.
  • $1.5 million in 2018-19 for 20 Cheatham-White Scholarships each at NC Central and NC A&T. (Schools must match the state appropriation.)
  • $1.5 million for UNC tuition grants for 2017-18 graduates of the NC School of Science and Mathematics.6
  • $5.5 million for a Health and Wellness Facility at Fayetteville State University.7
  • In a needless move, the UNC Board of Governors may hire staff to report directly to the Board.
  • Senior citizens may audit UNC and Community Classes for free if space is available.
  • The Board of Governors will study creation of School of Health Sciences at UNC Pembroke and schools for Physician Assistants, Chiropractic Medicine and Basic Law Enforcement at Winston-Salem State.8

Community College Items

  • Community College enrollment growth funded at $5 million per year to support the equivalent of 803 additional full-time students.
  • Community Colleges receive an additional $10 million per year for salary adjustments.
  • $3.2 million in 2018-19 for Eastern Triad Workforce Development pilot apprenticeship program.9

1 http://www.wral.com/cooper-calls-budget-deal-irresponsible-/16774013/.
2 http://www.northcarolina.edu/apps/bog/index.php?mode=browse_premeeting&mid=5630&code=bog, Committee on Budget & Finance, Item 2, p. 26.
3 http://www.higheredworks.org/2017/05/nc-disinvestment/.
4 http://ncleg.net/Sessions/2017/Budget/2017/conference_committee_report_2017_06_19.pdf, General Fund Availability Statement; pp. 2-5.
5 http://ncleg.net/Sessions/2017/Budget/2017/conference_committee_report_2017_06_19.pdf, p. L8.
6 http://ncleg.net/Sessions/2017/Budget/2017/conference_committee_report_2017_06_19.pdf, pp. F39-F46.
7 http://ncleg.net/Sessions/2017/Budget/2017/conference_committee_report_2017_06_19.pdf, p. M6.
8 University provisions, http://ncleg.net/Sessions/2017/Budget/2017/S257vccr.pdf, pp. 114-144.
9 http://ncleg.net/Sessions/2017/Budget/2017/conference_committee_report_2017_06_19.pdf, pp. F29-F33.

Comments

  2. Opal Hoyle says

    Will retired State employees get a cost of living raise. We all worked hard for the state and we deserve a raise .

    Reply

  4. Fred says

    The budget says that “most other states employees getting a flat $1000 raise.” Why not ALL other state employees. Who are the state employees who are not getting the 1000 bucks? Are they getting any raise?

    Reply

    • Higher Education Works says

      The General Assembly gives the University System flexibility to establish the parameters by which it distributes raises. So raises for University employees will generally average $1,000, but not every employee will see a raise of exactly $1,000.

      Reply

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