The Senate and House have both passed the state budget, and Governor Perdue has signed it into law — on time and in place for the start of the new Fiscal Year for the first time since 2003. I believe the budget is a thorough blueprint for our state as we come out of this awful recession and keeps us on track for the recovery. It helps small businesses, protects classroom teachers, supports our community colleges and universities, and prepares us for the future.

First, let me tell you what’s not in it: no pay cuts or pay raises, no mandated furloughs, no mass layoffs, and no new tax increases. In the aftermath of the Great Recession and historic budget shortfalls, that was quite a feat.

CUTTING SPENDING
This budget takes us back to 2006-2007 levels at under $19 billion. We have made difficult cuts — we’ve cut spending by $800 million in this budget and we’ve identified another $518 million in cuts if Congress does not come through with their federal health care matching funds. In all, the budget has been cut by around $3 billion over the last two years without even taking into account the federal recovery funds that helped us protect education and health care for the needy.

SUPPORTING SMALL BUSINESSES AND CREATING JOBS
The budget includes a tax credit for 125,000 small businesses (most of which have less than 10 employees) that employ 500,000 people in our state. It lowers the cost of maintaining and adding jobs in North Carolina for the next two years by allowing a refundable income tax credit to a small business equal to 25% of the amount it paid in unemployment insurance tax on wages paid to employees.

The budget also includes:
• Loans to help small businesses keep their doors open and funds to help small businesses leverage federal entrepreneur grants
• Restores funds for Small Business Centers at 58 community colleges, which supports the development of new businesses and the growth of existing businesses by being a community-based provider of training, counseling, and resource information
• Builds the “In-source NC” database to help NC companies find and use other NC companies for supplies and services

PROTECTING EDUCATION

The budget works to protect classroom teachers and minimize cuts to K-12 education. We were able to protect an estimated 1,700 teaching positions by adjusting the Education Lottery receipts budgeted for classroom teachers.

It also:

• Provides funding for handheld diagnostic devises, giving teachers a high-tech tool for measuring student progress.
• Preserves recurring funding for dropout prevention grants
• Fully funds enrollment growth at community colleges, which has grown by over 30,000 students this year alone
• Fully funds enrollment growth at universities, and removes any proposed cap on enrollment
• Provides $33 million for community colleges to purchase vital health, science, engineering, and technology equipment

PROVIDING FOR THE PEOPLE OF OUR STATE
• Helps working families with health insurance costs; adds 2,750 more kids to Health Choice for a total of 137,789 children
• Restores damaging cuts to the mental health system
• Continues North Carolina’s landmark per year investment in cancer research
• Statewide expansion of CJLEADS, a new data system to track probationers

We have worked well with our counterparts in the House, and this is truly a compromise budget where, in most cases, we met in the middle. In North Carolina, we have a long tradition of being a state where people want to live and work, to raise their families, and to retire. The priorities we fund help shape that quality of life. Even in the toughest of times, we have come together to craft a budget that is, I believe, a strong and appropriate plan to lead our state into brighter days.

The full budget is here:
http://www.ncleg.net/Sessions/2009/Bills/Senate/PDF/S897v8.pdf

The spending and reduction summaries:
http://www.ncleg.net/sessions/2009/budget/2010/SB897_Joint%20Conference%20Committee%20Report%2006-28-10.pdf

As always, please don’t hesitate to let me know your thoughts on the budget or any other issue you feel is important and thank you for the opportunity to serve you in the Senate.