By Chris Fitzsimon
The full Senate budget proposal was on display Tuesday in the Senate Appropriations Committee and there were few surprises in it, as many of the key decisions were released in sparsely attended subcommittee meetings late Monday afternoon.
There wasn’t much of a debate Tuesday either. Most of the two-hour budget committee meeting was filled with explanations of the bill that most senators got their first look at sometime Monday night.
After a handful of mostly minor amendments, the committee approved the plan. No passionate speeches by folks upset about cuts to children’s health care programs or the meager investments in affordable housing.
No Republican critics blasting the plan for too much spending or borrowing. No one said much of anything, continuing the odd malaise surrounding the budget process this session.
The Senate pay raises track the House plan, three percent for teachers, 2.75 percent or $1,100 for state employees, whichever is greater. The Senate provides more money for the university system, fully funding enrollment increases and rejecting a House plan to direct UNC President Erskine Bowles to find $18 million in budget cuts.
The Senate spends $41 million on Gov. Mike Easley’s More at Four program, almost double what the House budget includes. There are significant differences in the Senate’s list of construction projects, particularly on university campuses, and how to pay for them.
There are dozens of other issues between the two budgets that must be resolved, some involving thousands of dollars, others millions, and almost all vitally important to people who need help.
But the most heated battle ahead in the push toward a final budget agreement isn’t likely to come over More at Four or the UNC budget or even children’s health care. The fight will be about tax policy, which taxes to cut and what tax credits to establish.
The House budget includes a package of tax changes, most notably an increase in the State Earned Income Tax Credit (EITC) to help the working poor and an extension of the tax credit for small businesses that provide health benefits to their employees.
The Senate budget sets aside $50 million for tax reductions, but includes no specifics, which reportedly is not sitting well with House leaders, who expected to be negotiating the budget and tax plans together.
The Senate is not expected to approve an increase in the EITC and has already passed a repeal of the state gift tax that will cost $18 million and a reduction in the sales tax on home heating fuel that will cost $25-30 million.
That takes most of the Senate reserve for tax cuts and doesn’t include anything for the small-business credit for health coverage or the House proposal for a break on property taxes for veterans.
Both the House and Senate budgets make plenty of wise investments in education and some in human services, but neither budget invests enough in programs to help families who are struggling to find housing or child care they can afford.
Neither invests enough in the sputtering mental health system, instead cutting the community support program and using the money elsewhere instead of redirecting it to mental health services.
Neither budget breaks out of the narrow frame of election-year politics and raises revenue to make the overdue big investments in prison alternative programs or the embattled probation and parole system. Neither stops multi-state corporations from shifting profits to avoid state taxes, a move that would raise enough money to make the investments.
Unless things change dramatically in the next few days, those big battles are over, though there are important programs at stake, like children’s health care.
But the question now is, who will get the tax breaks, the people who always get them, folks who can afford to give tens of thousands of dollars away every year, or people who barely make enough to pay their rent and buy their family food?
If lawmakers aren’t willing to make bold investments to help the working poor this year, the least they could do is send a little tax break their way.