STATE
LEGISLATIVE ACTIVITY
GOVERNOR EASLEY RELEASES BUDGET PROPOSAL
Governor Easley released his 2005-06 budget proposal today. With
a $1.2 billion budget shortfall, most of today’s discussion
focused on the Governor’s revenue proposals. Easley’s
budget maintains the ½ cent sales tax, which is set to sunset
at the end of this year, but proposes allowing the top income tax
bracket on the top 1% of income earners to end. In addition, the
Governor proposes an increase in the cigarette tax of 35 cents
this September and 10 cents more next year. Health care advocates
who have fought for a cigarette tax increase say this is too little
of an increase to stop children from smoking. “This level
of increase spread out over a year is just a regressive tax; it
is not a public health measure,” according to Adam Searing,
Director of the Justice Center’s Health Access Coalition.
There is no mention of the lottery. Overall, the Governor’s
revenue plan places a disproportionate burden on middle and low
income households.
The Governor’s spending plan focuses especially on education.
He would double funding for the Disadvantaged Student Supplemental
Fund, half to be recurring and half one-time moneys. He also proposed
teacher pay raises and a new nurse/social worker program to identify
at-risk students and families. Easley’s budget fully funds
university enrollment growth. He provides $17.4m more to keep the
NC Health Choice program open and $5m for the Mental Health Trust
Fund. More budget analysis will be included in next weeks Justice
Center Legislative Update.
JUSTICE CENTER 2005 ECONOMIC RECOVERY LEGISLATIVE AGENDA
The Justice Center’s 2005 Economic Recovery Legislative Agenda
puts forward a road map for extricating North Carolina from its current
downward spiral of billion dollar budget shortfalls, dropping median
income and increasing poverty. The agenda proposes strong steps that,
if implemented, would go a long way toward addressing the unmet needs
of North Carolina’s unemployed, underemployed and low-wage
workers. It also calls on public officials to make tax code changes,
investments and planning to address the long-term issues facing the
state.
BUDGET AND TAX CENTER EXPLAINS BUDGET SHORTFALL
The Justice Center’s Budget and Tax Center provides a summary
of the causes for the state’s $1.2 billion revenue shortfall
for 2005-06.
It’s Baack…PAYDAY
LENDING RETURNS TO THE NC LEGISLATURE
Few issues have so divided state legislators as the question of
whether and how to legalize payday lending. As it is currently
practiced,
most payday loans are “rollover” transactions where
consumers are “flipped” multiple times. This results
in many consumers paying more than 400% in interest. Learn more
about the issue and a possible compromise solution in the latest
Justice Center Policy Brief, Payday Lending in 2005.
RULES,
HOUSE COMMITTEE APPOINTMENTS, more…
The House appointed committees last week creating several new committees
and only somewhat changing the full Appropriations Committee chairs.
House
Resolution 318, the House rules, has not yet been passed and
was last referred to the House rules committee for further work.
Senate Resolution 1, the Senate rules, was passed the first day of
session. Both are available on line and include information on how
and by when bills must be filed.
Appropriations
Committee has continued to hear presentations from staff on the
current state of various parts of the budget. All are
available on line at www.ncleg.net. Today the Governor’s staff
presented his overall budget plan and tomorrow HHS Secretary Carmen
Hooker Odom will present about that portion of the budget.
FEDERAL ACTIONS
BUSH BUDGET WOULD CUT BILLIONS FROM NC PROGRAMS TO FUND TAX CUTS
Bush’s budget proposal would cut $214 billion from federal
funding going to States over the next five years according to a new
report by the Center on Budget and Policy Priorities. These funds
currently go to a wide range of “domestic discretionary” (non-entitlement)
programs run by States and local governments. $27 billion would be
cut from natural resources and environmental programs alone. These
domestic discretionary spending cuts are in addition to cuts to food
stamps and Medicaid. The Bush plan would cut $1.4 billion from North
Carolina’s Medicaid program PLUS from 2006 to 2010 North Carolina
would also lose:
- $292
m in K-12 Education
- $166
m in Vocational and Adult Education
- $18
m in WIC Supplemental Nutrition Program, causing 18,400 fewer persons
to receive services
- $208
million in Community Development Block Grants(CDBG), Community
Services Block Grant (CSBG) and 16 other community development
funding streams
- 14,400
child care subsidy slots would be lost in 2009
- $3.1
million cut from Low Income Home Energy Assistance
- $1.7 billion in federal “grants in aid” to
States and Localities
The cuts are proposed as an effort to curtail the explosion in federal
deficit spending; however, 48% of federal spending in 2005 is the
result of tax cuts made since 2001 and only 15% is due to the domestic
programs like those being cut. The remaining 37% of 2005 spending
will be for defense and homeland security. If the Bush tax cuts implemented
in 2001 and 2003 are made permanent this will add another $10 trillion
to the budget deficit, regardless of program cuts.
TELL CONGRESS NOT TO CUT THESE CRITICAL PROGRAMS
And Don’t Make Tax Cuts Permanent
Congress is currently debating its “budget resolution” which
will set overarching limits on spending and tax cuts. The “budget
resolution” process, expected to be complete by March 7, could
force Congressional committees to make the cuts proposed by Bush.
This is the first – and perhaps most important - of several
critical moments in the federal budget process. This could determine
everything to follow.
CONTACT
NC SENATORS DOLE AND BURR NOW
Tell
them North Carolinians say:
- No to federal spending cuts
- No to shifting costs to the states when we are already struggling
- No to permanent tax cuts causing the federal deficit
Senator
Burr’s
phone number: 202-224-3154,
Senator Dole’s
phone number: 202-224-6342
TAKE ADDITIONAL ACTION TO SAVE MEDICAID
The
Justice Center’s Health Access Coalition has convened
health care, older adult, children’s and other associations
and coalitions to make their voices heard. This group has come up
with two more ways you can respond to the proposed cuts to Medicaid.
WRITE
A LETTER TO THE EDITOR:
Especially if you live outside the
Triangle area, write a letter to the editor of your local paper explaining
why Medicaid is important to all of us here in North Carolina. You
may want to include facts about how important Medicaid is for families
facing huge nursing home costs or how Medicaid helps families when
health insurance is lost because of job loss.
Writing
a letter using our listing of papers and addresses is easy – just
click here.
BACKGROUND INFORMATION ON NC MEDICAID:
See
the NC Health Access Coalition newsletter on how the federal
government is trying to save money by shifting costs to NC.
See
five talking points on the importance of NC Medicaid.
See
the latest official Medicaid information prepared for the
NC General Assembly.
SIGN
ON TO OUR LETTER TO CONGRESS: Before March 1, have your organization
sign
on to the new Coalition for Medicaid letter to our Congressional
delegation opposing the at least $1.4 billion in cuts to North Carolina
for Medicaid proposed in President Bush’s budget. Health costs
don’t go away just because the federal government decides to
cut NC Medicaid funding. These cuts aren’t a cost savings but
really a cost shift down to North Carolina from Washington.
See
the letter and get the sign on form.
See
Governor Easley’s letter to President Bush opposing
these Medicaid cuts.
