SEEING RED

After all, it was on Valentine’s Day when Gov. Beverly Perdue presented her “State of the State” speech to the North Carolina General Assembly. Dressed in red and standing in the well of the House Chamber, Gov. Perdue looked over an assembly that included all Republican men representatives in bright red neckties. They could have been signaling North Carolina is now a red state.

The governor said she her budget is about $2.5 billion less than that adopted in 2010. Then she surprised the senators and representatives by announcing her budget reduces the corporate tax rate to 4.9 percent, the lowest in the Southeast and third lowest in the United States. Loud cheers from the men in red ties. But the governor did not spell out where offsetting revenue will be found. In addition, she said cuts to education will be modest and will not jeopardize classroom personnel–teachers and assistants. This brought cheers from Democrats.

On Thursday, Legislators received the budget. The one-cent state sales tax, set to expire this June, would be extended, but reduced to three-fourths of a cent. To the fury of State Employees groups, 10,000 state workers would go: 1,000 with buyout agreements, 4,000 with retirements, and 5,000 layoffs due to merging of departments.

Republican leaders immediately attacked the governor for maintaining the sales tax. They also charged her budget does not adequately fund the $60 billion state pension account. Liberal Democrats cringed at reducing taxes for corporations while maintaining the sales tax paid mostly by poor and middle class consumers.

Gov. Perdue probably recalls the words of N.C. depression-era Gov. O Max Gardener of Shelby: “Sometimes I lie in bed at night and wonder about how I let my personal ambition lead me to this job.”

HERE WE GO…IT STARTS NEXT WEEK

Although appropriations committees have been meeting for three weeks, the agenda have been background sessions from staff members. Calm, few questions, mainly from newcomers to the Legislature. Next comes the presentation of the Governor’s budget, with its specific line-item cuts. A rare new program is the proposed Career College program that allows high schools students to obtain a two-year Community College degree at no cost…provided passing grades are maintained.

The Mobility Fund budget in the Department of Transportation would be maintained, using funds to invest in highly congested areas. Industry-recruiting funds also would be maintained.

IN…FOR NOW

The Manufacturing Solutions Center a.k.a Hosiery Technology Center is in the Governor’s budget at the 2010 level of funding. For now, that is. The majority party insists the sales tax is a no-starter so heavy chopping will be done to make up over $1 billion in lost revenue. Our work has just begun.

The Textile Technology Center is presumed to be included as same level funding in the Gaston College appropriation. The N.C. Community Colleges budget overall has a small increase for now, mainly to cover the Career Colleges initiative.

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