- 4.7 percent raise for teachers, 1.5 percent raise for state employees
- Lowers tuition at select universities to $1,000 per year for in-state students and $5,000 per year for out-of-state
- Adds $10 million to the Disaster Relief Fund.
Republican legislative leaders have hailed the $22.34 billion budget agreement reached over the weekend.
Senate Leader Phil Berger (R-Rockingham) and House Speaker Tim Moore (R-Cleveland) said that the compromise budget includes a 2.8 percent spending increase and “achieves both chambers’ shared goals with Gov. Pat McCrory of prioritizing teacher pay raises, cutting taxes on the middle class, controlling the growth of government spending and bolstering the state’s savings.”
The budget offers a relatively small increase in spending compared to previous budgets, giving conservatives more to be happy about than past budgets did.
“I am grateful to members of the Senate and House for reaching a compromise that continues the discipline and conservative principles of spending responsibly, taxing sparingly and saving wisely that have turned North Carolina’s fiscal outlook around from multi-billion-dollar deficits to significant budget surpluses,” Berger said. “This budget keeps our promises to support our public schools and raise teacher pay above $50,000, let families and small businesses keep more of their hard-earned money, and control the spiraling costs of college.”
“This budget is the embodiment of what can be accomplished when common sense, conservative ideas are put to work,” Moore said. “We are cutting taxes, reinvesting in the state’s infrastructure and saving money. I am particularly happy that, in addition to teachers, we were able to deliver pay raises to our state employees and provide a one-time payment to our much-deserving state retirees.”
The budget will boost average teacher salaries to $50,186 next school year and to nearly $55,000 within three years, moving average teacher pay above $50,000 for the first time in state history.
Under the budget plan, teachers will get pay raises averaging 4.7 percent, and state employees will get raises averaging 1.5 percent.
The budget also includes a 1.6 percent cost-of-living raise for state retirees.
The budget agreement provides more than $550 million in salary and benefit changes for state workers. but even with the increases in spending for salary adjustments the overall increase in the budget is less of a jump than those passed in years without large salary increases for state employees.
The budget includes the targeted raises the Senate was seeking, including experienced-based step increases to valuable teachers, assistant principals, principals, State Highway Patrol troopers, clerks and magistrates and correctional officers and provides a 4.5 percent pay raise to assistant district attorneys, public defenders and other judicial branch workers.
Providing salary increases for high-performing employees has been a goal of conservatives in the past and with this budget the state is moving closer to that goal.
In education the budget includes provisions to help make college far more affordable by lowering tuition to $1,000 per year for in-state students and $5,000 per year for out-of-state students at Elizabeth City State University, University of North Carolina at Pembroke and Western Carolina University.
The budget also provides for no in-state tuition increases for a standard undergraduate college term at all North Carolina public universities as well as freezing student fees at all North Carolina public universities at current levels.
The budget also limits future increases to student fees to no more than 3 percent per academic year.
The move to lower state tuition originally included some of the state’s historically black colleges and universities, but pushback from critics who claimed the degrees would be devalued killed that part of the proposal.
For K-12 education, legislators provided funding for the hiring of an additional 450 first-grade teachers to reduce class sizes.
For the Opportunity Scholarship Program, championed by conservatives, lawmakers are setting aside a $34.8 million grant for need-based scholarships.
The budget also maintains the 2014-15 levels for teacher assistant funding.
The spending plan includes an increase in the standard income tax deduction to $17,500 over the next two years, reducing the amount of income that is taxable each year.
The budget would put another $475 million in the Rainy Day Fund. That would bring the fund close to equaling 8 percent of yearly spending. The idea is to buffer North Carolina from the fiscal shock of the next recession.
The budget also invests nearly $500,000 for Zika Virus prevention and detection in the state.
One move that may dismay conservatives: The budget repeals the $500,000 cap on state funding for light-rail projects.