by Paige Terryberry
Senior Analyst for Fiscal Policy, John Locke Foundation
North Carolina is one of the few U.S. states left without a budget for the current fiscal year. It is also one of just a few states with a Republican legislature and Democrat governor.
This divide has led Gov. Roy Cooper to veto every budget presented to him in his tenure as governor. In 2018, the legislature was able to override Cooper’s budget, which marks the last time a budget bill was enacted.
In Wisconsin, one of the few other states with a partisan split between the legislature and governor, Democratic Gov. Tony Evers signed the budget (with minor changes) presented to him by the GOP-controlled legislature. Gov. Evers is now lauding his action as “one of the largest tax cuts in Wisconsin state history” just weeks after calling the legislature’s budget “inadequate.”
In North Carolina, Gov. Cooper should follow suit and accept the legislature’s budget and the tax cuts, investments, and savings that accompany it. Compromise is possible, as Evers showed.
This year, an unprecedented combination of surplus funds and federal aid allows for more of everything. Cooper should be excited in particular about the increase in capital spending and the raises to state employees in the Senate and House budget plans – items he used as reasoning for his budget veto back in 2019.
Indeed, Cooper could brag about bringing substantial tax relief to middle-and lower-income households, tax cuts that generate larger percentage breaks to the working class than to high-income households, as well as sizeable salary increases and bonuses for teachers.
If Gov. Cooper chooses to not sign the budget – North Carolina will continue on a recurring budget. Further complications will ensue as we expect a patchwork of “mini budgets” that address specific spending priorities to be rushed through the process to account for the failed budget bill.