NC Perdue will veto bipartisan $20.2 billion budget adjustment

Gov. Beverly Perdue announced today her intention to veto the General Assembly’s bipartisan $20.2 billion budget adjustment that invests in many key priorities after we refused several unreasonable demands to hike taxes by nearly a billion dollars, raid critical dollars for Medicaid, or use budgetary gimmicks that would result in a massive revenue shortfall for the next governor and General Assembly to address.

Gov. Perdue used apocalyptic language to explain her veto, and yet the difference between the dollars she demanded and what we budgeted is a fraction of one percent of the total budget. The fact that she would reject hundreds of millions in additional state funding for public schools and Medicaid, a cut to the state gas tax and a raise for teachers and state employees proves she’s more interested in winning a political battle than in doing what’s right. She turned her back on North Carolina’s children today, and I will work to override this irresponsible veto.

The governor’s desperate attempt to score political points with her liberal base will have real consequences if the House of Representatives cannot muster enough votes to override her veto. Should that happen, the two-year budget enacted last year will remain in place. The consequences of Perdue’s veto will be:

· $255 million in additional state funds will not go to public K-12 education. This includes $126.9 million to fill in the discretionary cut for the 2012-2013 fiscal year, $16.4 million in lottery funds, a $27 million education reform program to strengthen student literacy and improve graduation rates, and $85 million for a 1.2 percent raise for public school teachers.

· In addition to public school teachers, state employees will lose a 1.2 percent raise. This will be the fifth consecutive year they go without a salary increase. State retirees will lose a 1 percent cost of living adjustment increase.

· The state’s Medicaid program will run out of money during the fiscal year, causing doctors to go unpaid and patient care to suffer.

· Programs for needy families and the state’s at-risk population will not receive $900 million in federal block grants.

· The state’s gas tax will not be cut.

· North Carolina’s college students will lose $18.6 million in additional money for need-based scholarships and financial aid.

· Regional Economic Development Commissions will not receive the additional $1.3 million they need to continue to recruit new employers to North Carolina.

· More than a dozen state programs under continuation review – including UNC-TV and family courts – will not have their funding restored and will be eliminated.

· The Division of Employment Security will lose the ability to transfer $20 million to operate offices around the state, creating greater hardships for the unemployed.

· Tens of millions of dollars in mortgage settlement and Tennessee Valley Authority settlement funds will be left unspent.

· Dozens of state buildings, representing hundreds of millions of dollars in infrastructure investment, will either be closed or unable to open, including libraries, research facilities, and hospitals.

Given the potential consequences of her veto, it is clear Gov. Perdue knowingly turned her back on the children of our state and rejected a step towards a brighter future for all North Carolinians. Our state deserves better.

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Senator Phil Berger

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FOR IMMEDIATE RELEASE

Contacts: Amy Auth (Berger), 919-301-1737

Brandon Greife (Berger), 919-301-1735

Jordan Shaw (Tillis), 919-733-3451

Perdue Pulls Fast One on N.C. with Accounting Gimmick

Raleigh, N.C. – Gov. Beverly Perdue today threatened to jeopardize North Carolina’s future financial stability by attempting to use tax over-collections and other one-time funds on recurring priorities. The unexpected increase in collections is largely the result of taxpayers failing to make adjustments to their estimated payments after the General Assembly passed a tax credit for job-creating businesses last year.

Below is a joint statement from Senate President Pro Tempore Phil Berger (R-Rockingham) and House Speaker Thom Tillis (R-Mecklenburg).

“Gov. Perdue is pulling a fast one on North Carolina. The truth is our state does not have an additional $117 million to spend now. The governor is using an accounting gimmick to spend next year’s money this year, which would create a massive revenue shortfall for the next governor and General Assembly to address. This is the equivalent of going on a spending spree with your credit card – it creates the illusion of prosperity in the short run, but you’re left with a huge bill when the interest payment comes due. This stunt may seem acceptable to a lame duck governor who won’t have to deal with the consequences of her actions, but we are committed to creating long-term solutions.”