Local News
5:34 pm
Tue July 15, 2014

NC Agencies Spend Cautiously As Budget Haggling Continues

It’s already two weeks into the fiscal year and North Carolina’s budget is still up in the air. The state Senate today proposed a new compromise with House lawmakers that would offer eight percent average pay raises for teachers. That’s down from the Senate’s original eleven percent proposal. The House and Senate have also disagreed on Medicaid funding. It all means state agencies are currently spending money with caution. 

WFAE’s Lisa Miller joins All Things Considered host Mark Rumsey.

MR: Lisa, how do departments know how much they can spend right now?

LM: The state has a budget. We’re currently in the second year of a two year spending plan. Lawmakers are working on tweaking that second year budget.  Well, it’s more than tweaks. There are some big items like how to fund teacher raises and who is eligible for Medicaid. So Art Pope, the state budget director, has advised departments to look at spending levels laid out in the House and Senate plans.  Whichever plan has the most cuts, he tells them to expect that much money. 

MR: Okay, but what about all those teacher assistant positions the Senate budget would eliminate to pay for teacher raises?

LM: That’s actually the one exception. So the North Carolina Department of Public Instruction has taken that out of the calculation. When you do that, the House budget has the bigger cuts. For example, house leaders chose to fund the teacher raises by not adding extra second and third grade teachers which had been the plan under the two year budget passed last year. 

MR: How much of a headache is it for agencies to budget with all this uncertainty?

LM: Well, I thought Philip Price would be in a good position to know. He’s the budget guy for the state Department of Public Instruction. Here he is:

PP: It’s certainly manageable, but it is better to have a budget in place, than it is to go through this exercise. 

LM: In March he sent out a notice to school districts to expect to hire more second and third grade teachers, because lawmakers provided money for that when they approved the two-year budget a year ago. Now, he’s had to get the word out to scrap that unless the Senate gets its way, which would mean districts would then have to scramble to hire teachers. He’s also mentioned drivers ed. That’s making administrators nervous because the Senate budget pretty much cuts funding for that. So that students and parents would have to pay up to $300 for courses, instead of the $55.  But he’s going ahead and telling school districts to charge $55. But he’s also trying to give districts some security and letting people know the state will have to provide that subsidy for those students.  So here he is:

PP: I have been letting them know we’ve been spending the money and that they can’t cut it all out because then we have nothing to cover those expenditures.

LM: Who do you let know that?

PP: Anyone who will listen to me actually.  But I do most of my conversations with fiscal analysts and the general assembly. 

LM: They then relay that to lawmakers.

MR: Thanks, Lisa.

LM: Thank you.