Chris Fitzsimon
Just a few weeks ago, the conventional wisdom in Raleigh was that lawmakers could face a budget shortfall of a billion dollars next session. Others thought it might reach $1.5 billion. Behind the scenes lawmakers were being told that a $2 billion hole was possible.
The $2 billion figure is now the conventional wisdom. Rep. Jim Crawford, a House budget chair in the 2007-2008 session, used that number in a recent candidate forum when he was asked about the state fiscal situation.
Legislative economists released figures last week showing that state revenues came in $230 million short of projections in the first quarter of the state fiscal year. There are now projections behind the scenes that the shortfall could approach $2.5 billion if lawmakers give teachers and state employees any pay raise at all.
Last month Governor Mike Easley directed state agencies to reduce their budgets by two percent, but exempted public schools and Medicaid. Now agencies are scrambling to cut three percent instead of two and the impact of the reductions is already being noticed.
Wake Technical Community College has a hiring freeze on administrative positions and no out-of-state travel will be allowed. Mitchell Community College has frozen all hiring, travel and equipment purchases. This at a time when enrollment at community colleges is growing rapidly and state leaders are hailing the community college system as a vital part of the state’s economic development strategy.
The budget was a major topic of discussion at the recent meeting of the UNC Board of Governors. UNC campuses are already scrambling to cut their operating budgets by four percent as mandated by the budget passed by the General Assembly last session.
UNC officials expect more cuts to come. UNC- Greensboro has put off construction of a new School of Education Building. And it’s not just higher education that’s feeling the pinch.
Officials with the Iredell County Partnership for Children say the cuts will make it difficult to provide salary supplements to child care workers and to continue open enrollment for insurance reimbursement. Local officials in Wilmington who oversee services for people with a mental illness or disability haven’t yet adjusted to the latest twists in the state system and worry that the new round of budget cuts on top of the uncertainty will mean families who need services will be ignored.
There are dozens of similar stories across the state and they will only increase as next session approaches when lawmakers will have to fill that $2.5 billion hole. The stories are crucial to the debate.
There is certainly waste in state government that needs to be eliminated, but most of the taxpayers money pays for programs and services that people depend on, people who ought to be on legislators’ minds when suggestions come for deep across the board budget cuts.
When House and Senate budget writers gather in the corner room of the Legislative Building the last few weeks of every legislative session to hammer out a final budget agreement, they bargain and barter and throw around funding numbers for programs like they are betting on a football game. But the numbers represent people’s lives, their ability to get a job and take care of a son with a disability or find affordable child care so they can go to work.
The 2009 General Assembly session may still be three months away but the biggest challenge facing members of the House and Senate has already been decided: how to balance the state budget without making things tougher on the people who are already struggling.
That will mean cutting programs that aren’t as high a priority, and raising revenue from people who can afford to pay more, and closing tax loopholes for corporations. It also ought to mean looking at every pot of money, from Golden Leaf to the Health and Wellness Trust Fund to every other dedicated source of revenue.
The state budget is ultimately a list of priorities. Next year will not be the time to set money aside and then use what’s left over for schools and services for children and the disabled. Everything needs to be on the table before the numbers starting flying in the corner room next July.
Chris Fitzsimon is the director of NC Policy Watch.