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Yahoo
23-05-2025
- Business
- Yahoo
Taxes, salaries, vacancy cuts make plain differences over rival North Carolina GOP budgets
The North Carolina House's reveal of its state government budget proposal makes plain the differences on taxes, salaries and job cuts between Republicans who control both General Assembly chambers, according to the Associated Press. With strong bipartisan support, the House gave preliminary approval late Wednesday to its plan to spend $32.6 billion in the year beginning July 1 and $33.3 billion the next year — the same amounts Senate Republicans agreed to for their competing two-year budget approved last month. The amounts reflect a more strained fiscal picture amid uncertainty over federal government spending, inflation and projections of flat or falling tax collections. 'We've had to tighten the belt a little bit more than we normally have,' Rep. Donny Lambeth, a top chairman of the House Appropriations Committee, told reporters. But the chambers' paths to those figures show deep areas of disagreement as they pursue a compromise they hope new Democratic Gov. Josh Stein can accept — or build enough legislative support to withstand a Stein veto. ALSO READ: Honor system is over: Make sure you report crypto on your taxes GOP leaders in both chambers agree a previously approved law reducing the current 4.25% individual income tax rate to 3.99% in 2026 should stay in place. But the House, concerned about revenue shortfalls, doesn't want to go along with the Senate proposal to reduce that rate to 3.49% in 2027 and 2.99% in 2028. The House also would make it harder to lower the rate below 3.99% by raising revenue thresholds contained in current law that state coffers must exceed before the rate automatically falls. The Senate tilts toward a more aggressive threshold, proposing a schedule that could reduce the rate one day to 1.99%. Stein has warned that the current thresholds, if left intact, could bring 'self-inflicted fiscal pain' by curbing revenues. Senate Republicans have downplayed such fears, and outside conservative groups argue the House budget actually would raise taxes — legislative staff calculate $2 billion-plus more revenue annually compared to current law. The national conservative group Club for Growth warned on X ahead of Wednesday's vote that anyone voting for the bill containing the 'tax increase in North Carolina should expect to be held accountable on election day, and kiss their political future goodbye.' The threat didn't faze House Republicans, some of whom considered it a scare tactic as talks begin with Senate counterparts. House leaders also note the plan would lower income taxes further by increasing standard deductions and eliminating tax on the first $5,000 of a worker's tips. 'Nothing on the outside of this building is going to change my belief and this (GOP) caucus' belief that this budget is ... the more fiscally conservative between the two chambers,' House Speaker Destin Hall said during a break in Wednesday's debate. The House plan would raise teacher pay well above the Senate proposal, with a focus on early-career instructors. The House proposal would increase state-funded salaries of K-12 teachers by 8.7% on average over the next two years. The Senate's proposed raises are well under half of that percentage, but that doesn't include $3,000 bonuses the Senate also approved. The House says its plan would vault compensation for first-year teachers to top levels in the Southeast. Stein's budget proposal released in March would raise teacher pay well over 10% on average. House Republicans would direct state agencies, departments and institutions to eliminate nearly 3,000 vacant positions, while the Senate version directs that 850 vacancies be eliminated. The Office of State Human Resources notes there were more than 14,000 vacancies in state agencies as of last month. About two-thirds of the House's cuts come from a directive for agencies to eliminate 20% of their vacant positions, with cost savings intended to beef up salaries to recruit and retain workers for critical hard-to-fill positions. After an expected final House vote Thursday, the budget bill will return to the Senate — a prelude to House-Senate negotiations on a unified plan to present to Stein. The goal is to have an enacted budget by July 1, but meeting that deadline has been difficult in recent years as Republicans have battled each other and the Democratic governor. Given this week's discourse over taxes, GOP intraparty negotiations could extend deep into summer. Legislative Republicans currently are one seat shy of a veto-proof majority, meaning Stein could wield some influence. For now, Stein backs the House plan over the Senate. In a statement released during Wednesday's floor debate, he praised its proposals for teacher pay, cutting taxes for working families and reducing income tax rates 'only when the economy is growing.' 'The House's proposed budget isn't perfect,' said Stein, yet while also criticizing 'the Senate's fiscally irresponsible revenue scheme.' Stein's words trickled down into Wednesday's vote. Following five hours of debate and dozens of amendments, 27 House Democrats joined all the Republicans present in voting 93-20 for the plan. VIDEO: Honor system is over: Make sure you report crypto on your taxes
Yahoo
22-05-2025
- Business
- Yahoo
NC House passes its budget with a prediction of tough negotiations ahead
Getty Images/iStock The state House gave final approval to its budget proposal Thursday, with one of its lead authors predicting a hard road to passage of a final spending plan. The budget passed with a bipartisan 86-20 vote. Some Democrats who spoke Thursday said they hoped House negotiators would be able to keep the items they liked in the final version in negotiations with Senate Republicans. The House and Senate budgets are marked by glaring differences that must be resolved before both chambers vote on a compromise that will go to Democratic Gov. Josh Stein for his consideration. The chambers are far apart on how much to raise teacher pay and on future cuts to individual income tax rates. 'Do we have a long road? Absolutely. We all know this is a process and this is a first step,' said Rep. Donny Lambeth (R-Forsyth), a House senior budget writer. 'We will not be intimidated,' he said. 'We're going to hold strong.' The state's 2023 budget built in up to three automatic personal income tax cuts in tax years 2027 to 2034 that depend on the state meeting revenue targets. The House budget changes those revenue targets, meaning the state would need to bring in more money to trigger a reduction in the personal income tax rate, likely delaying a cut. The Senate budget goes in the opposite direction, adding more future cuts. Talking with reporters Thursday, Senate leader Phil Berger (R-Rockingham) said it seems that the House wants to reopen negotiations on a tax policy that was settled in 2023. 'We had an understanding and an agreement in 2023 as to what the progression of tax policy would be over the years and the House budget goes in a completely different direction than that,' he said. Earlier this week, the conservative Club for Growth threatened House members who voted for the budget, based on the tax changes. All House Republicans who were present voted for the budget. Rep. Abe Jones (D-Wake) said he felt good voting for a budget with big teacher raises. The House budget proposes to increase new teacher pay from $41,000 a year to $48,000 for the next school year, and to $50,000 the following year. Jones said he wanted to strengthen the House negotiators' position when members sit down with senators. 'I wanted our team to go in with a strong hand,' he said. 'Y'all defend what we've done here. I hope we can come out strong with most of what we have painfully, thoughtfully put in. It deserves to be defended.' Meanwhile, Democrats who voted for the budget said it contained good ideas but could have been better. The sums Republicans have socked away to pay for private school vouchers continued to come in for pointed criticism. Rep. Lindsey Prather (D-Buncombe), who voted for the budget, said the state could do more if it stopped prioritizing private schools and corporations instead of people. The legislature is phasing out the corporate income tax. It will hit zero by 2030. 'I hope that this budget gets much, much better in conference,' she said.
Yahoo
21-05-2025
- Business
- Yahoo
North Carolina representatives debate $65B+ budget
RALEIGH, N.C. (WNCN) — On Wednesday, debate continues in the General Assembly over how to spend more than $65 billion in your tax money. Democrats attempted to make dozens of amendments to the Republican-drafted budget, including a failed amendment to only lower the corporate tax rate if and when the personal income rate is lower. 'Under this budget, the corporate rate continues to raise unbridled toward zero, and that is just fundamentally unfair,' Representative Deb Butler said. Republicans, who hold a majority in the House and Senate, also rejected an amendment to keep money in a fund for Medicaid recipients, something Democrats pushed to do because of uncertainty about what the federal government will do with Medicaid. 'We'll deal with them once we know what those federal issues are,' Representative Donny Lambeth said. In a statement, Governor Josh Stein says the budget isn't perfect, but, 'Importantly, the House budget cuts taxes for working families while recognizing that North Carolina is a growing state and reduces personal income tax rates after this year only when the economy is growing.' After being passed, the budget will head back to the Senate and then go into conference meetings to draft a final version for the Governor. Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
Yahoo
15-05-2025
- Business
- Yahoo
NC House begins advancing GOP budget, with votes set for next week. Here's what's in it.
North Carolina Legislative Building (Photo: Galen Bacharier/NC Newsline) Republicans in the North Carolina House began unveiling their plan for the state budget Thursday, laying out a spending proposal separate from the Senate's in a series of committee meetings. Senate Republicans approved their own version of the budget weeks ago, sending it to the House. But as is standard practice, the House will pass a budget of its own, requiring budget writers from both chambers to sit down and hammer out a compromise. Rep. Donny Lambeth (R-Forsyth), a lead House budget writer, remarked that the proposal developed by him and his GOP colleagues was 'better than the Senate's.' But he said concerns about the national landscape, as well as a busy few weeks that also included the 'crossover' deadline, complicated matters. 'Are there cuts in here that I don't like?' Lambeth said. 'Absolutely. But we're up against a really challenging time economically … we've just had to balance out a lot of priorities.' The rapid process Thursday drew frustration from Democrats, who did not have access to the budget's hundreds of pages until just prior to committee hearings. And their ability to amend the budget was limited by a series of watertight legislative rules that prevented almost all substantive changes. 'With respect, we should really have more time — at least a day,' said Rep. Phil Rubin (D-Wake). Early next week, larger committees will approve the budget before it heads to the full floor for debate. The House budget is widely expected to include raises to teachers, principals and school staff, much like the Senate's. But the specifics of those raises aren't yet known; details will come next week. Lawmakers have debated different variations on cell phone restrictions for K-12 classrooms this session. A version is included in the House education budget that would require all districts to eliminate or severely restrict phone access. School boards would also be required to adopt guidance for policing how students can access the internet. They would be limited to 'age-appropriate subject matter,' and wouldn't be able to access social media through school-provided internet. And $10 million would be earmarked yearly to train teachers on the 'science of reading,' a method for teaching literacy in schools championed by the last two state Republican superintendents. The UNC System would be hit with funding reductions — $61 million in the first year of the budget, and $69 million in the second. The Board of Governors would be asked to prioritize cuts to the system office and systemwide initiatives before making cuts to individual campuses. Tuition rates would also likely go up. Lawmakers are asking the system to generate at least $30 million from tuition in new revenue in fiscal year 2026-27. The system has not raised tuition in nine years. On the chopping block under the House's budget for the Department of Health and Human Services is the Office of Health Equity. The office, which describes itself as working to 'eliminate health disparities,' is eliminated under the plan. Legislative staff said the cut would mean the removal of three full-time positions, and save around $3.2 million. Lawmakers are also aiming to cut long-empty positions, tasking HHS with cutting $10 million worth of vacant roles. That would roughly equate to 200 cut positions. The state's expanded Medicaid program would also see major changes under the budget. Like the Senate version, House lawmakers are moving to attach work requirements to Medicaid coverage. House Republicans in Washington are working to include similar requirements in the federal budget. The budget would also end coverage of weight management drugs like Ozempic and Wegovy for Medicaid enrollees. And the House plan takes a slightly different tack than the Senate on child care, but still aims to increase the subsidy reimbursement rate. The House declined to follow the Senate's lead in eliminating the Innocence Inquiry Commission, which investigates post-trial claims of actual innocence. Instead, it proposes to rename the program to the 'Postconviction Review Commission.' Budget writers in the House are also proposing to make the State Bureau of Investigation an independent agency, removing it from the purview of the Department of Public Safety. Lawmakers made a similar move with the highway patrol last year — a measure currently being challenged in court. Republicans are also making a number of changes to judgeships — removing them from some counties and adding them to others. Those changes drew Democratic opposition, with Rep. Marcia Morey (D-Durham) filing an unsuccessful amendment to reverse the removal of a judge from her district. The House budget also amps up funding for the Center for Safer Schools, providing $50 million in school safety grants. The Senate plan allotted $35 million. Like teacher pay, details on raises for state workers — which are expected to be higher than in the Senate's budget — were not included in the draft budget Thursday. North Carolina's State Board of Elections would see major changes under the House plan. It creates seven new 'exempt' (politically protected) staff positions for the board, a $1.5 million litigation fund for the hiring of private attorneys and $2 million to move the board into the same building that houses the state auditor's office. The board recently came under new, Republican-appointed leadership after the legislature passed a law shifting governance of the board to Dave Boliek, the Republican state auditor. Amendments offered by Rubin, a Democrat, to remove or delay the provisions were shot down by Republicans. The House is also proposing a new self-insurance system for state agencies, designed to replace a current system to protect state property. It would cost $200 million. House budget writers also included a laundry list of bills introduced this session to adopt new state symbols, including a state star, cookie and television show. And they set aside money to keep the legislative building's snack bar open later than usual when lawmakers remain in session. As has been the pattern for several years under Republican legislative leadership, the House proposal targets the Department of Environmental Quality for cuts to funding and programming Among other things, the proposal would eliminate the Office of Environmental Education, three positions assigned to the Environmental Justice initiative, and four positions in the Facilities and Health Services and Public Information Office sections. The proposal also axes funding used to support a pathologist position at North Carolina State University's Center for Marine Sciences and Technology. In contrast, the Department of Natural and Cultural Resources would realize some modest funding increases. This includes exhibit updates at state historic sites, as well as positions and operating costs for the expanded visitor center and grounds at Fort Fisher State Historic Site and North Carolina Transportation Museum. The budget allows funding to add a conservator, a museum park director, and a curator of Judaic art at the North Carolina Museum of Art, as well as additional funds for the North Carolina Symphony. The proposal also proposes more funding for costs associated with renovating and expanding the Fort Fisher Aquarium, and the new Asia complex at the North Carolina Zoo.
Yahoo
01-04-2025
- Health
- Yahoo
NC Republicans renew their support for Medicaid work requirements, while Democrats say ‘no'
Legislators were divided Tuesday over a move intended to smooth the way for North Carolina to require people who gained health insurance though Medicaid expansion to work. Republicans on the House Health Committee voted in favor of House Bill 491, which its sponsor, Rep. Donny Lambeth (R-Forsyth) described as a signal to Washington decisionmakers that state legislators support work requirements. Nearly all Democrats on the committee voted no. Rep. Carla Cunningham (D-Mecklenburg) abstained. Rep. Garland Pierce (D-Scotland) said after the committee meeting the bill wasn't 'fully vetted.' Rep. Becky Carney (D-Mecklenburg) said the bill 'wasn't ready for prime time,' though Lambeth 'did what he thought was right.' North Carolina's 2023 Medicaid expansion law already includes a provision requiring the state Department of Health and Human Services to pursue work requirements if it seems federal administrators will allow them. The federal government sets baseline requirements for Medicaid coverage and pays most of the bill. States must ask permission before changing their Medicaid programs. Under President Donald Trump's first administration, state requests to impose Medicaid work requirements were approved. Courts overturned some of those approvals and President Joe Biden's administration later rescinded others. Congressional budget-cutters are now considering work requirements as a way to save money in the Medicaid program. Along with work requirements and other cuts, Congressional Republicans are also considering a reduction in the 90% in funding support the federal government currently provides to states for people covered under Medicaid expansion. North Carolina's Medicaid expansion law includes a trigger that would end Medicaid expansion, which would withdraw health insurance from more than 600,000 people, if the federal government's support falls below 90%. None of the money for people insured under Medicaid expansion comes from state coffers. Lambeth's bill requires the state Department of Health and Human Services to tell the legislature how much money is needed to implement a work requirement and says it would be imposed regardless of another state law on income thresholds and eligibility categories. 'It basically reiterates what the current expansion bill already says, signaling to the folks in Washington we'd be supportive of that if we got to that point,' Lambeth told the committee. 'I'm hoping by signaling we're okay with a work requirement, they will get off the idea of changing our funding formula. If the funding formula is changed, even a small tenth of a percent, one percent, it is a major impact to North Carolina, and we hope we don't have to go down that path.' Lambeth has stated previously that a reduction in federal support would be 'a disaster.' Rep. Sarah Crawford (D-Wake) co-sponsored a bill that would get rid of the trigger. Under that bill, Medicaid expansion in North Carolina would be spared if the federal government's financial support falls below 90%. Crawford voted against the work requirement bill. 'There is no evidence that work requirements actually increase work participation,' Crawford said after the committee meeting. Most adults who use Medicaid as their insurance and are able to work already do. 'About eight percent of people on Medicaid who are able to work are not working, so it's a relatively small number of people. Those individuals typically have a number of barriers to employment that include a whole host of things — where they live, their health, access to transportation. All that we've seen in the past, when other states have tried to implement work requirements, it actually leads to be people being left without coverage.' Arkansas imposed a Medicaid work requirement for less than a year in 2018 before a judge ended it. About 18,000 people lost their health insurance, according to a study, and the work requirement did not lead to increased employment. Arkansans were not able to report their work hours due to lack of internet access, didn't know about the requirement, or didn't think it applied to them, a 2019 study said. Stateline reported Tuesday that between 4.6 million and 5.2 million adults ages 19 to 55 could lose their health care coverage under an emerging congressional Republican plan to impose Medicaid work requirements nationwide. Lambeth said after the meeting that the work requirement would cover people who gained insurance under Medicaid expansion. In that case, people with disabilities who are insured under special Medicaid programs would be exempt. Lambeth worked for years to extend Medicaid coverage to more adults, and for a long time he was one of the few Republicans in the legislature openly supporting it. He sponsored bills that were precursors to the 2023 Medicaid expansion law that included work requirements. Including the requirement for at least 90% federal funding in the 2023 expansion law was one of the conditions for winning greater Republican support, he said. 'The only way we got that bill approved was to have triggers in there,' Lambeth said. The 90% trigger and work requirements were necessary to 'cobble together enough Republican votes.'
