Posted on May 17th, 2022
Like clockwork, a long session of the General Assembly is followed by the short, but what does that even mean? And, most importantly, what is North Carolina going to spend its money on in 2022-23?
We’re here with your short session preview of all things K-12, early childhood, and community college. We’ll get into it, but first, where did we leave off?
Any context for the short session budget requires some understanding of what happened with the long session budget. An agreement on that budget was reached in November 2021 — five months after the end of the fiscal year, when the state actually wants to have a new budget in place.
Cooper vetoed the previous budget in 2019, and Republican General Assembly leaders didn’t have the votes to overturn him. So, the budget passed in November 2021 was the first in several years. Also, going into the long session, the state had a surplus of $4 billion, which grew to more than $9 billion in unreserved funds by October 2021.
Because there had been no budget in several years, Republican leaders agreed to negotiate with Democratic Gov. Roy Cooper over what was to be in the budget. That may sound like a reasonable state of affairs, but in North Carolina it’s anything but. In recent years, the governor has generally been shut out of budget negotiations, and that’s even more true since Cooper took office after the tenure of Republican Gov. Pat McCrory.
Ultimately, negotiations between Cooper and legislative leaders fell apart last year, but had advanced far enough that Cooper got enough of what he wanted and ultimately signed the budget. Here are some of the highlights:
The short session is different from the long session in that there are limits to what lawmakers can consider. This document lays out what those limits are, but let’s go through some of them.
Bills related to or affecting the budget can be taken up. Basically, the biennium budget included funding that covers two fiscal years: 2021-22 and 2022-23. During the short session, revisions can be made to that second fiscal year because the state has a better handle on revenues and how much money is actually available.
Beyond the budget, a big thing to consider is that any bill that passed at least one chamber during the long session is open for consideration, as are any bills that were vetoed by Cooper.
That’s right. That means we could see another appearance of the bill that would have forced schools and districts to make available to the public information on what instructional materials and activities are being used in classrooms. It passed the House but wasn’t really ever taken up in the Senate.
Also possibly up for consideration is controversial legislation that many took to calling a “critical race theory” bill, even though nothing in the bill explicitly addressed critical race theory or called it that. The bill that ultimately passed the legislature included various concepts that teachers weren’t allowed to “promote.” Cooper vetoed the bill, but the legislature never tried to overturn his veto.
And that brings us, finally, to second year revisions to the biennium budget. But first, consider the process: The governor releases his proposed budget first and then the Senate and the House take turns presenting their proposals depending on the year.
In the long session, the Senate went first, so this year, the House will kick things off.
Earlier this month, Cooper released his priorities. Next, we can expect the House to present its plan and then the Senate. The Senate and House will haggle over differences and arrive at a final budget proposal, which will likely pass the legislature and go to Cooper for consideration.
But what can we expect to be in this budget? We’re almost there, but first we need to know…
A consensus revenue forecast dropped recently, and according to it the state will have a roughly $4 billion surplus for the current fiscal year and almost $2 billion for the next one. That’s one-time money, which can’t really be used for recurring expenses, but it does give lawmakers and the governor some wiggle room.
Lawmakers have indicated their plan when it comes to these dollars.
“It is crucial that we continue on this track of responsible and disciplined spending in light of the potential for a recession as we begin the short session budget process,” said House Speaker Tim Moore, R-Cleveland, and Senate President Pro Tem Phil Berger, R-Rockingham, in a statement.
Cooper himself doesn’t seem to be taking the forecast as an opportunity to go on a spending spree — his budget recommendations include about $1.5 billion in unallocated money for 2022-23.
We’ll get into Cooper’s recommendations, but first let’s discuss priorities of two powerful groups: The State Board of Education and Department of Public Instruction (DPI).
The State Board voted on joint budget priorities between itself and DPI at its most recent meeting. These include nearly $14 million for literacy coaches and 115 early learning specialists, as well as additional funding to cope with rising fuel costs.
Generally speaking, DPI and the State Board are also together in wanting pay increases for teachers, particularly given rising inflation.
But the State Board is separately asking for a couple of items of its own, including advocating for $15 million to fund 115 social workers for school districts and $18 million for 51 positions for DPI’s efforts in turning around low-performing schools.
State Superintendent of Public Instruction Catherine Truitt advocated against those options at the recent meeting, arguing that now wasn’t the time to ask for them, particularly given the amount of federal COVID-19 money left over and accessible to districts. She also said the DPI group responsible for turning around low-performing schools isn’t ready to expand its operation.
Cooper’s budget proposal reflects the joint budget ask from DPI and the State Board, giving them the money for the literacy positions and increased funding to deal with fuel costs, among other priorities.
While the governor’s budget doesn’t explicitly grant funding for the 115 social workers the State Board is asking for, it does include $70 million for 850 instructional support positions, which could include social workers, but also school counselors, nurses, and psychologists.
The governor’s budget also asks for $57 million and $20 million for students with disabilities and English Language Learners, respectively. These items are aimed at removing the cap on funding for these students and providing additional funding. Currently, the state caps funding as a percentage of total students in the district at 13% for students with disabilities and 10.6% for English Learners.
In 2016, the General Assembly’s Program Evaluation Division conducted an evaluation of K-12 funding and found (among 10 other things) that:
“The allotment for children with disabilities fails to observe student population differences and contains policies — intended to limit overidentification — that direct disproportionately fewer resources to LEAs with more students to serve (the allotment at that time was capped at 12.5%); and
“The allotment for students with limited English proficiency lacks rationale and fails to observe economies of scale, resulting in illogical and uneven funding.”
Since that report, Cooper has proposed removing the caps twice without success. His current ask is included among other Leandro compliance line items. Don’t worry, we’ll get to Leandro in a bit, but first…
Of course, the biggest ticket item in any budget is salary increases.
The long session budget guaranteed teachers an average 5% pay increase over two years — 2.5% in both years. So, with an additional 2.5% average in the second year, that increase goes up to 5% in 2022-23 under Cooper’s plan.
The governor also wanted more bonuses, including roughly $3,000 more for teachers and some other personnel. Basically, every state employee would get a $1,500 bonus under Cooper’s plan. An additional $500 would go to any state employee making less than $75,000. And then teachers, instructional support staff, and administrators would get another $1,000.
And don’t worry, part-timers — you would get a prorated amount for bonuses you are eligible for based on how much you work.
In addition, Cooper is proposing $500 million for public school construction and $75 million — on top of a previously budgeted $100 million — to fund local teacher supplements.
While we don’t know yet what legislators will do on teacher pay or bonuses, we do have a clue about how at least one powerful legislator feels. Rep. John Torbett, R-Gaston, chair of both House education appropriations and education committees, made his feelings on teacher pay clear recently.
“We shouldn’t thump our chest on a 5% pay increase to teachers when you have inflation at eight and a half percent, you have fuel costs over a 100% increase, you have rental charges going up 20%, you have health care going up 14%, and the list goes on,” he said while presiding over a House committee on the future of the state’s education system. “So the 5% pay increase is really a negative by the time everything else comes out.”
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