North Carolina budget protects teacher assistants, driver's education

RALEIGH (WTVD) -- House and Senate Republicans announced the details of their final North Carolina budget proposal for the next two years Monday afternoon.

Click here to read the budget bill

The budget was supposed to be in place July 1, but negotiations have dragged through the summer. The first year of the plan spends more than $21.7 billion.

"We're concerned about the length of time, but the more important thing is that we get it right," said Senate leader Phil Berger.

Senator Berger and House Speaker Tim Moore said the compromise worked out by the House and Senate includes a 2.1 percent spending increase and protects teacher assistants, driver's education, historic preservation tax credits, and a tax deduction for medical expenses. They were all things that were cut in previous versions of some House and Senate plans.

The proposal raises early teacher pay from $33,000 to $35,000 a year and reduces class sizes to a 1-to-16 ratio - a Senate priority. Teachers will also get a one-time $750 dollar bonus along with all other state employees.

But some teachers who spoke with ABC11 said they had hoped for more.

"I feel a little confused and concerned because I thought there were going to be some better things coming from this budget," said Durham County teacher Dov Rosenberg.

Rosenberg has been in the classroom for 15 years and says his colleagues deserve better.

"I think we all deserve a cost of living adjustment from 2008," said Roseberg.

While protecting teacher assistants and driver's ed, the budget proposal mandates that school districts use money earmarked for those uses on those items.

The plan also expands the state's new Read to Achieve program which helps kids who are behind in the first and second grade.

The budget also includes tax changes. It offers $400 million in tax relief by lowering the personal income tax rate, but it expands the tax on things that are currently not taxed like some services.

The budget spends an additional $705 million over two years on transportation projects, in part by ending a $216 million transfer from the Highway Fund to the General Fund.

"The provisions in there have been much debated, much discussed, much talked about and I don't think there's anything in there that anyone will be surprised by," said Berger.

"Throughout this process, the House has remained firm on its priorities to reward our teachers and State personnel, preserve Driver Education, continue to employ valuable Teaching Assistants, find innovative ways to improve our education standards and to invest in North Carolina to strengthen our future. We can never afford to stop looking for ways to improve our State," stated Speaker Moore

Both the House and Senate must vote twice in favor of the compromise before it goes to Gov. Pat McCrory.

Through his spokesperson, the governor said he was looking at the details.

"The governor would like to thank the members of the General Assembly for their hard work and public service. The governor and his team will thoroughly review the proposal to ensure it is fiscally responsible and aligns with our state's priorities in key areas that the governor has championed including job creation, education, healthcare and transportation," said Communications Director Josh Ellis.

Here are some bullet points:

In Salaries and Benefits

• Allocates $313 million in the first year alone for compensation increases to state employees, including a $750 bonus for all teachers and state workers.
• Offers experienced-based step increases to teachers, assistant principals, principals, State Highway Patrol troopers, clerks and magistrates.
• Sets aside funding for pay raises to community college employees.
• Allocates funds for a 3 percent market-based salary increase for all sworn members of the State Highway Patrol and raises starting salaries from $35,000 to $36,050 per year.
• Funds Gov. McCrory's recommendation to invest more than $38 million over two years to boost salaries for correctional officers.
• Funds Gov. McCrory's plan to provide additional targeted, market-based pay raises to attract and retain highly effective workers.

In Education

• Increases funding for public education by more than $530 million in the first year alone.
• Reduces class size in first grade to a 1:16 teacher-student ratio in the second year - a step research has repeatedly shown is key to academic success.
• Enhances textbook and digital learning resources funding to ensure that students across the state receive the tools they need to succeed.
• Expands the Read to Achieve summer reading camps in to first and second grades.
• Increases support for the opportunity scholarship program by $14 million over two years to award more need-based scholarships to children from working families.
• Provides for comprehensive data collection and study of driver education to improve the program and help ensure better student outcomes.
• Fully funds teacher assistant positions at the 2014-2015 level and includes language to protect those jobs.
• Allocates funding to the School Connectivity Initiative to bring better broadband and WiFi access to all North Carolina schools.

In Taxes and Economic Development

• Cuts the personal income tax rate to 5.499 percent beginning in 2017.
• Increases the zero percent tax bracket in 2016 - ensuring taxpayers married filing jointly pay no state personal income tax on their first $15,500 of income.
• Encourages job creation and private investment in North Carolina by moving to calculate corporate income tax on the basis of a single sales factor over the next three years.
• Provides new local tax revenue to support education and economic development in counties with insufficient local sales tax dollars. The additional local revenue must be used to support public schools, community colleges or economic development in those counties.
• Maintains the existing system for allocation of local sales tax revenue, where 75 percent is allocated based on the county where a sale takes place and 25 percent is based on population - ensuring no local government will lose revenue under the changes.

Elsewhere

• Provides $225 million over two years to begin the process of restructuring and reforming the state's chronically troubled Medicaid program.
• Increases funding for essential court system needs - like interpreters, expert witnesses and juror fees - and operations at the Administrative Office of the Courts.
• Lays the groundwork to give voters the opportunity to pass a $2 billion bond referendum to support improvements across state government.
• Adjusts fees at the Division of Motor Vehicles for the first time in more than a decade to support additional transportation needs. The change in fees will be more than offset by the major tax cuts also found in the budget.
• Adopts the governor's proposal to create the Department of Information Technology, which is expected to save $30 million over the biennium by reducing duplicative spending and increasing consolidation.
• Implements the governor's recommendation to establish a more efficient state Department of Military and Veterans Affairs and provides close to $1.7 million to support military installations.