A Few Big Questions about McCrory's Budget

by Chris Fitzsimon, NC Policy Watch and NC SPIN panelist

Governor Pat McCrory and his State Budget Director Art Pope will release their proposed state budget for the next two years Wednesday morning.

The release will do at least two important things. It will frame the budget deliberations in the General Assembly as legislative leaders develop a spending plan for schools, human services, criminal justice, environmental protections, transportation, and other vital public investments that affect every person in North Carolina.

And it will further define the McCrory Administration that so far has surprisingly operated mostly in the background as House Speaker Thom Tillis and Senate President Phil Berger have dominated the policy debate and the political headlines in Raleigh.

When McCrory took the oath of office in January, it wasn’t entirely clear who the voters elected last November, the man who served as the reasonably moderate mayor of Charlotte for 14 years or the right-wing candidate who appeared at tea party rallies and voiced robocalls for Americans for Prosperity.

The first three months of this year have done little to answer that question. McCrory’s budget is his next and maybe most important opportunity to set the tone for his Administration for the next four years.

Here are a few of the many questions to ask about McCrory’s budget when he releases it Wednesday morning.

Will the budget recognize that state spending is at a four-year low as a percentage of state personal income and avoid deep and unwise across the board cuts? The N.C. Budget & Tax Center reports that overall General Fund spending is 11.4 percent less than when the Great Recession began.

That reduction comes as almost 20,000 more children are enrolled in school and more people are eligible for Medicaid and other services because of the effects of the recession. Teachers and hospitals cannot continue to do more with less. They can only do less with much less.

Will McCrory address North Carolina’s low-ranking in education funding and teacher pay by increasing investments or simply stick by his statement that there is no new money available for schools?

A bizarre music video press advisory released by McCrory’s office Tuesday included clips from McCrory talking about his commitment to education. But recent reports have ranked North Carolina 48th in the country in per pupil expenditures and 46th in teacher pay with starting teachers working 14 years to earn $40,000.

Superintendents, principals, and teachers recently came to Raleigh to talk with House leaders about the impact of the massive cuts in the last four years. Classes are larger, teacher assistants have been laid off and there’s no money for supplies or textbooks.

Will the misinformation and attacks on Medicaid continue? McCrory continues to draw criticism for his decision not to expand Medicaid under the Affordable Care Act to provide health care coverage to more than 500,000 low-income adults.

His response has been to claim that Medicaid is broken even though much of the overspending cited in a recent audit was the result of unrealistic cost savings included in the budgets passed by the General Assembly in the last two years even after lawmakers were told the savings were impossible to achieve.

As several Republican lawmakers have pointed out, Medicaid spending in North Carolina increased at a lower rate than any other state for the last several years. Medicaid is again running slightly over budget in the current fiscal year and McCrory has cited that fact to paint a dreary budget picture.

Will the war on environmental protections continue? The Republican General Assembly not only significantly weakened the regulatory authority of the Department of Environment and Natural Resources in the last two years, lawmakers slashed its budget too with an staggering 49 funding cut in agencies and programs in the NER budget area.

Will the far-right proposals for tax reform and arbitrary spending limits be reflected in McCrory’s first two-year spending proposal?

Senate leaders and the think tanks funded by State Budget Director Art Pope have called for radical tax reform that would raise taxes on low-income and middle class taxpayers while giving corporations and millionaires huge tax cuts. The proposals would also raise less revenue for the General Fund, forcing budget cuts to keep the budget balanced.

The Pope groups have also called for a misnamed Taxpayer Bill of Rights to limit state spending based on a rigid and ridiculous formula that would also sharply reduce state spending in future years, threatening education and human services.

And finally, is this McCrory’s budget or Art Pope’s? There are reports that Pope may leave the budget director post in the fall, making this his one shot at writing the state budget himself to make the deep cuts and ideological decisions he has long advocated personally and through the right-wing groups he bankrolls.

It shouldn’t be too hard to recognize Pope’s fingerprints if they are there. The Locke Foundation for example has in the past called for things like abolishing Smart Start and the Housing Trust Fund, significantly raising university tuition and slashing Medicaid services for seniors and the disabled.

McCrory was no liberal as mayor but he believed in public investments for the public good. It stands to reason that version of McCrory would bristle at the massive disinvestments advocated by Locke and the rest of the Pope empire.

But is that the McCrory who will be unveiling his first budget this week? Or has he bought into the hard right tea party philosophy or at least turned over the reins of his administration to people who do?

We will find out soon enough.