The July 1 deadline marking the start of North Carolina’s fiscal year is quickly approaching, but the General Assembly still does not have a budget. Despite Republican control of both the state House and Senate, the two chambers cannot reach an agreement on spending for the upcoming year.
Normally, each chamber puts forth a budget, then, along with the Governor’s Office, all three negotiate to create a final conference budget. This year, the Senate was slated to put forth its proposal first, but before that proposal, Senate Republicans wanted to agree on a total spending number with House Republicans. That number, however, has still not been reached.
The Senate wants to spend $25.6 billion in 2021-2022 and $26.4 billion in 2022-2023. Meanwhile, the House wants to spend $25.9 billion in 2021-2022 with no current offer for 2022-2023.
The two chambers have been exchanging counteroffers since March, having gone through at least five rounds of negotiations.
Orange County State House Representative Graig Meyer said Republicans in each chamber are refusing to negotiate with one another.
“No one would be surprised if there was a breakdown between the Republican legislators and the governor,” Meyer said. “Here the breakdown is between Republican legislators in each chamber. Nobody saw this coming and it’s not exactly clear why. It just seems like they’re playing a game of chicken and it’s at the cost of the people of North Carolina.”
Governor Roy Cooper has his own budget proposal to spend $27.4 billion in 2021-2022 and $28.5 billion in 2022-2023. Meyer said Governor Cooper’s increased spending is necessary to make a bigger impact.
“The governor has put forth a quite ambitious proposal that says look we are coming through a time of unprecedented need,” he said. “We have an unprecedented budget surplus that won’t last forever so let’s make some investments now that would pay long term dividends.”
While it is possible for the state to go without a finalized budget, which it’s has done in years past, if the chambers do not agree by July 1, the state will continue operating at previous spending levels until new a budget is passed.
North Carolina has operated on that continuation budget for the past two years, but Meyer said that needs to change if the next budget is going to address current problems.
“There is about $5 billion that we have in cash reserves that should have been spent over the last two years. It could’ve been spent on teacher pay raises, it could’ve been spent on community needs during COVID,” Meyer said. “If we don’t have a budget, that money will still be sitting in the bank.”
Meyer said there is a lot of uncertainty about what will happen with the budget, which likely means this stalemate will last well beyond the summer.
“My guess is that we are probably, more likely months away from having a budget rather than weeks away when the new budget should go into effect July 1,” he said.
Governor Cooper addressed the budget stalemate last week, urging all General Assembly chambers to work together. He called budget negotiations a “three-way street.”
Featured photo via Travis Long at The News & Observer
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