Tue July 1, 2014
Happy Fiscal New Year! Do We Have Anything To Celebrate Yet?
Today is July 1. The 182nd day of 2014. To most of us, it’s just another Tuesday. But to those North Carolinians more in tune with a fiscal calendar than a Gregorian one – state lawmakers, for example – today is also the first day of 2015. And that means the budget is passed and the short legislative session is over. Right?
Not so fast.
Happy fiscal New Year everybody! Did you go out last night? Watch the fireworks?
Hear the band play that special New Year song?
Wish your fellow party-goers a "Happy Fiscal New Year?" A salutation only accountants could love?
No? Don’t worry - no lawmakers in Raleigh did either.
Despite the speed with which the House and Senate passed their respective versions of a $21 billion budget set to begin today, the chambers have yet to reach a final deal. "Even if they don’t play well with each other," says political scientist Michael Bitzer, "there’s still going to be a budget and state government is still going to operate."
That budget was passed last year. This short session, like all the others, is there to make tweaks to the budget, add or subtract items, not create a budget whole cloth, says Bitzer. "What they’re trying to do is make adjustments and include state government employees and especially teachers – a pay raise that was not included in last year’s budget."
Both the House and the Senate preach the need to increase teacher pay. How much and how they pay for it is very different. The House wants a 5 percent increase paid for with more lottery money. The Senate wants 11 percent, but only for those teachers willing to sign away their tenure.
And even though both the House and Senate are controlled by Republicans, there are real ideological differences as well, says Bitzer. "By far the state Senate is much more conservative when it comes to the GOP conference versus their colleagues over on the House side."
House speaker Thom Tillis and Governor Pat McCrory have tried to bridge that divide. Last week they held a joint press conference where Tillis announced the House would take their teacher pay plan, change how they funded the raise and make it a stand-alone bill.
At the press conference Tillis said, "We can continue to talk about the budget and we’re hopeful that we’ll do that but lets just go ahead and take this off the table, fulfill this promise and then move on to completing the budget and getting out of town."
This new bill, dubbed the mini-budget, passed the House unanimously. But its received not so much as a peep from the Senate.
"I think really what it was was political maneuvering not a serious budget," says Sarah Curry, Director of Fiscal Policy Studies at the conservative John Locke Foundation.
And she has an idea to break this political logjam: reverse log rolling.
In essence, each department and division takes a look at their spending levels laid out in the House and Senate budget. Where the two numbers are different they should go with the lower amount.
This way, says Curry, "Neither chamber gets everything they want, essentially their little pet projects or what we like to call 'pork.' And so by taking the lower amount we have more for those necessary increases in state government."
It’s a novel approach. Even Curry doesn’t know if it’s been used on this scale before. But it’s exactly what the governor asked departments to do in a recent budget memo. Reverse log rolling seems to be the plan b if the Senate and House can’t reach agreement on a budget. Until they do – or they walk away – the short session will continue to go long.