Is bipartisanship emerging in North Carolina?

When was the last time both Republicans and Democrats voted to pass a state budget?

It happened last week when the NC House passed its two-year budget.

27 Democrats voted with the Republican majority to pass the House biennium budget; even Governor Josh Stein had some nice things to say about it. House Speaker Dustin Hall (R) and Minority Leader Robert Reives (D) may not be sitting around the campfire singing Kumbaya but there is evidence they are talking and listening to each other. That’s a good sign.

Stein is on record as saying the budget bill passed earlier by the NC Senate was “irresponsible,” obviously alluding to that chamber’s continued insistence on cutting personal income tax rates further. The legislature had already determined to cut the rate from 4.25 percent to 3.99 percent next year, but the Senate budget cut the rate to 3.45 percent in the second year of the biennium. The House demurred on second year tax cuts, heeding warnings from the Office of State Budget and Management (OSBM) that projected state revenue projections for the year beginning July 1 would meet the $32.6 Billion spending level agreed to by both chambers, but would be some 100 million short of the revenue trigger in the second year, when, spending levels would be $33.3 billion.

Senate President Pro Tem Phil Berger said he doesn’t believe OSBM projections that the state is headed for a “fiscal cliff.” Curiously, ultra-conservative talking heads are claiming the House was raising income taxes by not making the second-year cuts. House leaders responded, saying their budget would lower taxes by increasing the standard deduction and eliminating taxes on the first $5,000 in worker tips. They would also bring back the popular back-to-school tax holiday.

There are other differences between the two budgets. To free up funds the House calls for eliminating 20 percent (about 3,000) vacant state employee positions. The Senate eliminated only 850. The House would give state employees a 2.5 percent pay raise. The Senate plan calls for 1.25 percent increases and two-year bonuses. The House increases pay for starting teachers to almost $50,000, the second highest starting pay in the Southeast. Teachers would receive an 8.7 pay raise over the next two years and restores salary supplements for advanced degrees. The Senate provided 2.3 percent increases for teachers and two-year bonuses. State retirees would get cost of living adjustments both years of the House plan.

The House would not agree to the DAVE program which would authorize State Auditor Boliek to create a DOGE-like organization to eliminate waste in state government. Given what we’ve seen nationally, this is a smart move.

Both the House and Senate budgets clawed back $500 million from NC Innovation, the highly lauded initiative in which that organization approves research grants to public universities. The Senate would use $400 million to build a new pediatric hospital jointly operated by Duke and UNC. The House would allocate the savings to Hurricane Helene relief.

Both chambers would shift more appointment powers from the governor. The House would reinstate the NC Actual Innocence Commission.

What happens now? A conference committee will be appointed by both the House and Senate to reconcile differences and reach a compromise budget. This will likely take some time. When reconciliation is complete each chamber will be asked to vote up or down on the agreed upon conference budget with no amendments allowed.

If history is prologue, the Senate usually prevails over the House in these negotiations. Senator Berger has experience playing hardball. But the Senate might not be in as strong a position this year. House members have renewed confidence that their positions have been praised in many quarters. We will see just how hard the House will advocate for their ideals during negotiations. And we will watch to see how Governor Stein responds to the final budget. This will be the first time Stein will be put on the spot to pass or veto a budget. Governor Cooper vetoed more bills than all other governors combined, but Stein might not want to waste political capital using the veto stamp, since both Houses will have veto-proof majorities.

There’s a clock ticking. The new fiscal year for the state begins July 1. It would be nice to have a final budget approved prior to that date, however that rarely happens.

Here’s my spin: While both budget bills have strong partisan overtones, I believe the House version is more sensible, responsible, and more acceptable to more North Carolinians. We will watch to see how adamantly the new House Speaker and his team negotiate. And perhaps I am overly optimistic but when 27 of the 49 House Democrats join in voting for a budget we might, just maybe, see some signs of legislative bipartisanship emerging.

Without question the citizens of our state would benefit from that.

Tom Campbell is a Hall of Fame North Carolina broadcaster and columnist who has covered North Carolina public policy issues since 1965.  Contact him at tomcamp@carolinabroadcasting.com