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Art Pope Slams UNC System’s Budget ‘Needs’ For 2014-15

The push and pull of budget negotiations between Raleigh and Chapel Hill has begun again as 2014-15 budget talks have begun, and the state’s budget director, Art Pope, says the UNC system is asking for too much.

The Board of Governors sent the legislature a budget request 11.3 percent greater than that of the 2013-14 fiscal year. Pope replied saying that “it simply is not (a) realistic” request. He also said the request made by UNC was based on needs when it should have been a true budget. However, President Tom Ross said he and the University had a statutory duty to present the needs.

In December, the Office of State Budget and Management sent out a budget instruction letter asking all state agencies to submit a budget reduction and expansion request. In that, it needed to “equate to a net savings of a minimum of two percent of the agency’s 2014-15 certified appropriation.”

Pope said the Board of Governors should reconsider its request and submit a “more realistic proposal.”

To read the response by Pope to the Board of Governors, click here.


NC Ahead Of Schedule In Paying Off Federal Debt

RALEIGH – North Carolina Department of Commerce officials say the state is ahead of schedule in paying off its debt to the federal government.

“It’s been a good year in terms of paying off the debt,” says Division of Employment Security assistant secretary Dale Folwell. “We’re almost $100 million ahead of expectation.”

That’s important, he says, because “as long as this debt’s outstanding, employers in North Carolina–or future employers who are thinking about coming here–have to pay a higher federal unemployment tax.”

Following the recessions of 2001 and 2008, North Carolina borrowed heavily from the federal government to pay state unemployment benefits. By January of this year, the resulting debt had reached $2.5 billion—third highest in the nation behind only New York and California.

Governor Pat McCrory made paying off the debt a priority, and researchers estimated that the debt would be reduced to about $2 billion by the end of the year—but Folwell says it’s now even less than that, about $1.87 billion.

The focus on debt reduction came at the expense of other programs, but Folwell says the debt puts North Carolina at a competitive disadvantage when it comes to attracting new businesses or retaining existing ones, so paying it off is important—and it’s equally important to prevent it from happening again.

“Paying off the debt–we can’t stop there,” he says. “We have to build a surplus, so that no one ever gets in this situation again.”

If the latest projections hold, the state will pay off the debt in full by November of 2015.


House GOP Conservatives Help Propel Budget Bill

WASHINGTON — A sweeping vote by conservative Republicans controlling the House and President Barack Obama’s Democratic allies has sent a bipartisan budget agreement to the Senate, where it will encounter stronger but probably futile resistance from the GOP.

The modest package passed by the House would ease the harshest effects of another round of automatic spending cuts set to hit the Pentagon and domestic agencies next month. Supporters of the measure easily beat back attacks on it from conservative organizations that sometimes raise money by stoking conflict within the Republican Party.

Democrats who were upset that the bill does not extend jobless benefits for the long-term unemployed suppressed their doubts to advance the measure to the Democratic-led Senate, where Obama’s supporters appear set to clear it next week for his signature.


House Republicans Get Behind Budget Agreement

WASHINGTON — House Republicans are rallying behind a modest budget pact that promises to bring a temporary halt to budget brinkmanship in Washington and ease automatic budget cuts that would otherwise slam the Pentagon and domestic agencies for a second straight year.

President Barack Obama and Senate Democrats also are praising the measure negotiated with House Budget Committee Chairman Paul Ryan, the Wisconsin Republican who has morphed, however briefly, from an uncompromising small-government stalwart into a dealmaker eager to claim a partial victory on the budget.

The deal Ryan negotiated with Senate Democratic counterpart Patty Murray would preserve the bulk of tough agency spending cuts the GOP won in a 2011 showdown with Obama, while reducing the chances of a rerun of the partial government shutdown.

It’s set for a vote Thursday.


GOP, Obama Line Up Behind Modest Budget Deal

WASHINGTON — Top Republicans and President Barack Obama are lining up behind a modest but hard-won bipartisan budget agreement that seeks to replace a portion of tough spending cuts facing the Pentagon and domestic agencies.

The deal to ease those cuts for two years is aimed less at chipping away at the nation’s $17 trillion national debt than it is at trying to help a dysfunctional Capitol stop lurching from crisis to crisis.

It would set the stage for action in January on a $1 trillion-plus spending bill for the current budget year.

The measure unveiled by House Budget Committee Chairman Paul Ryan and Senate counterpart Patty Murray of Washington blends $85 billion in spending cuts and fees to replace $63 billion in cuts to agency budgets over the coming two years.


David Price Live at 8:30 a.m. — Budget Talks Continue In D.C.

WASHINGTON, D.C. – Budget talks continue in D.C. as another deadline approaches, and another deadline has been missed.

Congress had an informal deadline set for a week ago Monday to set the foundation for a budget deal that will help avoid another shutdown January 15, but no agreements were made. One of the lead budget negotiators, Maryland Democratic Rep. Chris Van Hollen, told the Washington Times that these discussions should be moving at a faster pace. Some members wanted the formal deadline December 2.

On October 1, a 16-day partial government shutdown began when an agreement on the debt limit—among other things—could not be reached as Republican and Democrat ideas didn’t align.

The half-month shutdown was halted when an extension to January 15 was made, but if a plan is not in place by that date, it all begins again.

U.S. Congressman David Price of North Carolina’s 4th District joins Ron Stutts on the WCHL Tuesday Morning News at 8:32 a.m. to discuss the progress of the talks in Washington.

Price is also currently active on the issue of the Iran interim nuclear agreement. He says he’s opposed to Congress imposing additional sanctions at this time. Tune in for his thoughts on that topic as well.


Senate Set To OK Budget Bill, But Fight Not Over

WASHINGTON – The Democratic-led Senate is ready to approve legislation averting a government shutdown Tuesday. But House Republican leaders are unwilling to accept the bill, ensuring that the nasty congressional squabble will spill into the weekend and possibly right up to the deadline – and maybe beyond.

The Senate scheduled votes today on the measure. Senators are expected to approve it after defeating a conservative effort to derail the bill and removing House-passed language stripping money from President Barack Obama’s health care law.

The battle has already produced plenty of drama, and not only between Democrats and Republicans.

After two conservative GOP senators blocked the Senate from completing its bill Thursday, Republican Sen. Bob Corker of Tennessee said they were delaying that vote so their followers could watch Friday’s debate on TV.


UNC Strategic Plan Hurt By Budget Cuts

CHAPEL HILL – The University of North Carolina’s five-year Strategic Plan took a big hit with the approval of this year’s budget by the N.C. Legislature.

However, System President Tom Ross says the way in which the cuts were handed out will allow the individual campuses to protect its most vulnerable areas.

North Carolina saw a permanent funding reduction of $115 million and a $64 million net funding reduction. The cuts also include the elimination of all funding for UNC’s School of Medicine, as President Ross announced $15 million was allocated last year.

President Ross says the fact that enrollment increases and building improvements were approved as well as tuition hikes for out-of-state students being confined to undergraduates all helped the budget struggle.

To read President Ross’ statement released on the budget, click here.


CHCCS Officials Already Worried About “Loss Of Jobs” In 2014

CHAPEL HILL – As your kids prepare to go back to school on Monday, Chapel Hill-Carrboro City School officials say they’re preparing for another tough budget cycle in the coming year–and they say it’s not going to be pretty.

“If additional funding doesn’t come in from Raleigh, we’d need to find the equivalent of about 30 teacher positions within our current operations,” says CHCCS assistant superintendent Todd Lofrese. “(That) would likely mean loss of positions, loss of programs, perhaps loss of jobs.”

School officials are already sounding the alarm about 2014 because they say the district’s fund balance has dried up. CHCCS has used that balance for several years to help offset the effects of state-level budget cuts–but Lofrese says that isn’t an option anymore.

“We’ve reduced our budget by $8 million, and we’ve absorbed over $4 million in cost increases over the past five years,” he says. “It would’ve been even worse if we hadn’t utilized our fund balance to help buffer these reductions–(but) we’ve now used all of our available fund balance.”

And so, heading into the budget development process for 2014-15, Lofrese says “we’re beginning with what we estimate to be a $2.2 million hole.”

That $2.2 million represents the money the district pulled out of the fund balance this year to avoid having to cut teacher positions. Without it, Lofrese says they may have to cut 30 positions in 2014. Teacher assistant positions could also be at risk: Lofrese says the district lost state funding for 25 TAs, and managed to preserve those positions in 2013 only by dipping into its own pocket. (Should that come to pass, Lofrese says the district would seek to cut vacant positions first—but layoffs are not entirely off the table.)

And Lofrese says the situation would be even worse, were it not for the strong support the district receives from county government.

“We’re very fortunate (that) we live and work in a community that has strong support for public education,” he says. “Our county commissioners continue to demonstrate that by providing the district with $4 million in additional funding this year.”

Lofrese says that funding enabled the district to fully staff the new Northside Elementary School while preserving existing programs–and even managing to reduce class sizes in fourth and fifth grade. Future county-level funding will also allow the district to preserve a few of the 40 teacher positions cut at the state level, even without the fund balance.

But the specter of state-level cuts still looms—and while Republicans in the General Assembly insist that this year’s budget actually increased funding for K-12 education, Lofrese says that simply wasn’t the case in Chapel Hill-Carrboro.

“Even after accounting for the elimination of the discretionary reduction, our district received less money from the state this year than we did last year, despite our enrollment increase,” he says. “I know there’s a lot out there in the media about whether public schools are getting more money this year or less money this year–we received less state money this year.”

(Other districts did see an increase in state funding, but Lofrese says even that increase wasn’t enough to keep up with the growth in the number of students.)

The effects of the budget cuts aren’t only felt in the loss of positions. Teachers in North Carolina have received only one small raise in the last five years, and this year’s budget also cuts pay increases for teachers with master’s degrees—and as a result, Lofrese says districts across the state are finding it harder to recruit and retain quality teachers.

That includes Chapel Hill-Carrboro.

“Just a few weeks ago we lost a great math teacher to Kentucky,” Lofrese says. “That teacher’s making $10,000 more in Kentucky than they would have made here, on the North Carolina salary schedule. We have a great local supplement, (but) despite our local supplement they’re making $6,000 more in Kentucky than they would have if they’d joined our district.

“That teacher would have had to work in North Carolina for 16 years to make the same amount of money they’re making in Kentucky this year.”

And in spite of the slowly improving economy, Lofrese says he doesn’t see the school funding situation getting better in the future.

“I don’t see the tenor changing anytime soon,” he says, “so we’re planning that budgets are only going to get worse at the state level.”

Still, as schools across town prepare to reopen on Monday–and Northside Elementary prepares to open for the first time–Lofrese says there’s still much to be grateful for.

“We’re excited to welcome kids back and to begin that whole process of teaching and learning that starts on Monday,” he says. “Monday’s a great day for a lot of folks across our community–especially the little ones.”

Monday marks the first day of school for CHCCS; the budget development process for 2014-15 begins in about a month.


ProgressNC Says McCrory’s “Stretching The Truth” About Education Budget

RALEIGH – Progress NC Executive Director, Gerrick Brenner says Governor Pat McCrory’s comment that this year’s education budget is the largest in North Carolina history isn’t fair to say.

“Well there’s a couple of things, one he’s not taking inflation into account, and two he’s not taking enrollment growth into account” said Brenner.

In an email, Communications Director for Gov. McCrory, Kim Genardo says the $7.86 billion for K-12 Education in this year’s budget referrers to the appropriated budget. An email sent out by ProgressNC on Thursday said, “Gov. Pat McCrory mislead the public once again about the education budget he signed into law.” It went on to say that $7.91 billion for K-12 education in ’07-’08 and $8.19 billion in ’08-’09 were greater.

However, Genardo said those numbers are actual budget, which includes additional reserves.

Still, Brenner says, taking inflation into account, the praise of the budget was misleading.

“Actually this education budget is about half a billion dollars less than it was in 2007-2008” Brenner claimed.

Some K-12 schools that received cuts to their budget have tried alternative ways to raise money. Brennar says he heard of a school in PolkCounty that held a fundraising breakfast to go towards school supplies. He also claims that this not an isolated incident.

“All you have to do is do a quick Google search and you can see news stories filtering in from across the state of counties having to cut teachers and teaching assistants” Brenner said.

Brenner says he doesn’t agree with the education budget along with other bills that the Governor passed. He says he thinks that the Governor is “twisting the truth” and is beginning to “stretch credibility.”