North Carolina Governor Perdue Announces 2009-2010 Budget Proposals

3/17/2009 -- North Carolina Governor Bev Perdue today announced her 2009-2010 proposed budget. Despite facing the most challenging budget situation in decades, her budget increases per-pupil spending, invests in job creation and protects public safety through probation, mental health and anti-gang initiatives.

“I am stepping up to the plate to help our citizens when they need it the most,” Gov. Perdue said. “Despite our nation’s tough economic situation, I stand ready to strengthen our middle class, improve public education and public safety, and ensure that government works smart for our citizens.”

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Gov. Perdue’s budget closes a $6.4 billion cumulative gap and reduces spending by $2.6 billion over the next two years. Her budget also utilizes $2.9 billion of federal recovery funds to support critical services and recommends a $1.3 billion revenue tax change for tobacco products and alcohol.

Gov. Perdue stresses recurring savings rather than one-time actions, asks agency heads to take a targeted approach to identify reductions, and eliminates or reduces 20 programs that are inefficient, duplicative or costly.

Governor Perdue’s Proposed Budget

ECONOMY

$50 million to maximize federal resources for infrastructure projects
$7 million to revitalize downtown areas through Main Street Solutions
$2 million to the Small Business Innovation Research matching grant program
$2 million to promote North Carolina as a business and tourist destination and to better market agricultural products
$5 million to encourage growth of green technology through the Green Business Fund
$36 million in tax relief for small businesses
$10 million for the UNC-Chapel Hill Biomedical Imaging Center
$18 million to Jobs Now initiative:
$5 million to hire additional faculty to help reduce the backlog for nurses
$3 million to support technical education programs in transportation, industrial, military and green technology sectors
$5 million to address equipment and technology needs throughout community colleges
$5 million in federal recovery funds to support displaced workers with child care, tuition and transportation costs while they pursue job training services
1.5 percent increase in earned income tax credit to provide tax relief

EDUCATION

· Increase in K-12 per-student spending, from $5,597 to $5,736

· $4.7 million to implement diagnostic testing, saving $2 million by ending duplicate testing

· $64 million to experience-based salary step increase for teachers

· $118 million overall increase in spending, including federal recovery dollars

· $7 million in recurring funds for innovative dropout prevention programs

· $3.5 million to support underperforming schools

· $3 million reserve for community colleges that see spike in enrollment

· $2.6 million to create 12 early college high schools

· $23 million increase to need-based financial aid

· No reductions, redirections or transfers of any lottery or corporate income tax receipts from the Public School Building Capital Fund

HEALTH AND HUMAN SERVICES

$4.3 million increase to S-CHIP, which will be able to cover 8,000 more children for the next two years
$12 million to add 111 local inpatient mental health beds
$3 million to retain 36 beds at Dorothea Dix Hospital
Limit reductions in direct services and does not displace persons currently served by Medicaid. Many provider reimbursement rates have been frozen, but base service rates have not been reduced

COMMUNITY SAFETY

$12 million increase to probation system for 29 supervisor and 117 officer positions
$10 million in federal recovery funds to invest in gang-related programs

Source: North Carolina Governor