Carolina Journal reports on where we stand with negotiations over a new General Fund state budget for the fiscal year that begins Tuesday, July 1.
The two chambers of the General Assembly have been unable to agree on their budget adjustments for the 2014-15 fiscal year, which begins Tuesday. Until they do, the administration of Gov. Pat McCrory has employed a fiscal tool also endorsed by the John Locke Foundation as a way for state agencies to move forward until a deal is completed.
McCrory’s budget director, Art Pope, on June 23 directed most state agencies to prepare for the new fiscal year by adopting a budget technique, known as “reverse logrolling,” which had been outlined a week earlier in a John Locke Foundation Spotlight report. “Logrolling” is a budgeting technique under which each chamber negotiates with the other to include specific line items in the final spending plan — choosing the higher spending level enacted by each chamber.
As outlined in a memo from Pope to department heads and fiscal officers, each state department and agency would reverse the logrolling process, operating under the lower of the two chambers’ previously approved figures for individual budget line items. Unlike the status quo, which would allow state government to operate at 2014-15 budget levels agreed to during last year’s budget debate, reverse logrolling would impose immediate cuts to agency and department budgets.
The General Assembly last year passed a budget that will keep state government operating until June 30, 2015. But during this year’s budget adjustment (or short) session, McCrory and legislative leaders have proposed a number of fiscal measures requiring new legislation, led by pay increases for K-12 public school teachers and state employees. Until the General Assembly and the governor enact that legislation, Pope’s directive will take effect.
Pope’s memo notes that vacant state positions that would have been cut in the proposed 2014-15 budget would not be filled, and teachers and other state employees would not receive pay raises or step increases.
Moreover, unless or until a new budget becomes law, the University of North Carolina system faces a $19.8 million budget cut and the Department of Public Instruction may lose 30 percent of its funding.
In an exception to the reverse-logrolling practice, the memo said the McCrory administration would restore 7,400 teaching assistant positions that were eliminated in the Senate’s budget plan.