Budget Outline Includes 7-Percent Teacher Pay Raise | Eastern North Carolina Now

    Publisher's note: The author of this post is Barry Smith, who is an associate editor for the Carolina Journal, John Hood Publisher.

$21.3 billion General Fund plan also raises salaries for state employees

    RALEIGH     Senate and House leaders on Tuesday rolled out specifics in their $21.3 billion General Fund budget, including an average 7 percent pay increase for teachers that would not eliminate teacher assistant jobs. It also provides $1,000 pay increases, plus benefits, for state employees. Most state employees also will receive five bonus vacation days.

    Senate President Pro Tem Phil Berger, R-Rockingham, said the budget was the culmination of three years of work following the 2010 elections, when Republicans took over the General Assembly and put the "state back on solid financial footing."

    "Responsible budgeting decisions and pro-growth economic policies have also enabled legislative Republicans to offer at this time the largest teacher pay increase in state history," Berger said.

    House Speaker Thom Tillis, R-Mecklenburg, agreed that the groundwork for this year's teacher pay increase was laid in 2011.

    "The way that we got to the point we are today is because of difficult decisions we had to make in 2011 to get the fiscal house in order," Tillis said. "Now we're in a position to provide these historic pay increases, to provide pay increases to state employees and teachers, to fulfill a promise we made to the educators back in February."

    Legislative leaders note that the $282 million price tag for the teacher pay increase is the largest dollar amount in state history, although lawmakers have previously given higher percentage salary increases.

    The 7 percent pay increase averages $3,500 per teacher, Berger said. He said the pay increase would move North Carolina teachers from 46th in the nation to 32nd in the nation in average teacher pay.

    The Senate originally had proposed an 11 percent increase for teachers who gave up tenure. The House proposed a 5 percent pay increase with no tenure strings attached. In the end, teachers were not required to surrender tenure to get a 7 percent raise.

    Superintendents would continue to have broad flexibility in spending, Berger said.

    Tillis said the increases include efforts to boost starting pay for teachers.

    Berger said that setting the base pay higher leaves future legislatures in a better position to make further changes to teacher compensation.

    "We now have a platform that we can build on to do things such as master's supplements, such as paying teachers additional amounts for teaching in hard-to-staff areas or in hard-to-staff schools," Berger said. "Those are things that will come in the next session and the next session."

    Budget writers also made room for film incentives in the 2014-15 spending plan, but not for historic preservation tax credits.

    The budget includes a $10 million film grant program that would replace the film production tax credit, which expires Dec. 31. Nor did the tax credit for renovating historic structures make it into the final budget. "It's inconsistent with the principles of tax reform," Tillis said, noting that investors are able to make a return on their investment.

    Berger also said the budget makes room for a new $20 million "closing," or job catalyst fund if the General Assembly approves Senate-backed legislation creating and expanding those programs for business incentives.

    Other provisions in the budget agreement include:

• A 5 percent to 6 percent pay increase for state troopers.
• An additional $800,000 for Opportunity Scholarships allowing children from low-income families to attend private school. The money adds to a $10 million program approved last year. The extra money will help more children attend private school than originally planned.
• Converting the current 37-step teacher pay system into a six-step schedule.
• An across-the-board, $500 pay raise for public school teaching assistants.
• Preserving current Medicaid eligibility. The Senate proposal originally would have made some disabled patients ineligible for Medicaid.
• Maintaining current funding levels for the state's university system.
• Reducing Medicaid spending by cutting payments to providers.

    Gov. Pat McCrory had suggested he might veto any budget including a teacher raise of more than 6 percent. However, Berger said that legislative leaders discussed the budget Sunday night over dinner with McCrory and tried to address the governor's concerns.

    Tillis said he thought McCrory was doing his job as governor in making sure that the General Assembly is funding the operations of the state. "Hopefully, we can secure the governor's support for a good budget," Tillis said.