Senate Passes Final Budget Compromise Investing in Core Priorities, Delivering Dramatic Teacher Pay Raise and Middle Class Tax Cut | Eastern North Carolina Now

    Raleigh, N.C.     State Senator Bill Cook (R-District 1) voted today in support of the final bipartisan state budget compromise with the House of Representatives and Governor Pat McCrory. The $22.34 billion balanced compromise plan cuts taxes, controls the growth of government spending, bolsters the state's savings, dramatically increases teacher pay - while also providing a 1.5 percent permanent pay increase and a 0.5 percent one-time bonus for state employees, and a 1.6 percent cost of living bonus for retirees. The budget increases education funding by $512 million and fully funds teacher assistant positions.

    Highlights of the final budget on coastal issues include:

• Increases appropriations to the N.C. Ferry Division by approximately 20% - and halts the Board of Transportation from instituting any tolls on ferry routes that presently do not have a toll - identical to Senate Bill 812 (Ferry Tolling/Replacement Funds) sponsored by Senators Cook and Norman Sanderson. Essentially, the budget establishes recurring funding for a new system-wide reserve account for the replacement of ferry vessels.
• Earmarks $3.6 million of the N.C. Ferry Division appropriations be allocated for the passenger-only Hatteras-Ocracoke ferry route. According to a NCDOT Passenger Ferry Feasibility Study determined several benefits: shorter wait times for car ferries, direct passenger route to Ocracoke Village, reservations for scheduled departure times, relieve vehicle traffic in Ocracoke, increased capacity/visitation for Ocracoke.

    "This budget puts an end to the ferry tolling debate once and for all. Since getting to Raleigh, I have been opposed to any type of a ferry tax, and along with Senator Sanderson, we have sponsored several bills to protect our citizens from ferry tolls - this is a victory for the citizens of Eastern North Carolina as well as the millions of visitors traveling to the area each year," Cook said.

• Appropriates an additional $1 million for oyster sanctuaries, $149,000 for 2 positions in the Division of Marine Fisheries to promote shellfish production and oyster shell recycling and an additional $300,000 for cultch planting. In 2015, the N.C. General Assembly reformed the shellfish cultivation leasing process by cutting the fees, reducing the regulatory barriers, and established over $2 million of funding to stimulate the expansion of the oyster aquaculture industries.
• Establishes a stakeholder working group to study and advance efforts to ecologically restore the resource and achieve economic stability of the shellfish aquaculture industry. The stakeholder panel shall include representatives of the commercial and recreational oyster harvesting industries, the North Carolina Division of Marine Fisheries, the Marine Fisheries Commission, nature conservation entities, and experts in the fields of marine biology and marine ecology.
• Establishes a crab pot removal pilot program and appropriates $100,000 to be administered by North Carolina Sea Grant at North Carolina State University for the removal of derelict crab pots in state waters.
• Provides an additional $8.6 million to the $18.3 million recurring budget of the Clean Water Management Trust Fund.
• Expands and clarifies the allowable uses of the aquatic weed control funding from state lakes to all waters of the state. Broadening this language allows the Albemarle region to address the invasion of noxious aquatic weeds that often have a detrimental effect on our water resources.
• Appropriates $94,340 to the City of Washington of Beaufort County for a downtown revitalization project.
• Authorizes $7.5 million of the appropriations for the N.C. State Ports Authority be allocated for dredging needs at the State Ports in Wilmington and Morehead City. Phosphate and sulfur products from PotashCorp located in Beaufort County represent 68 percent of total tonnage handled by the Port of Morehead City.
• Authorizes the Department of Natural and Cultural Resources to use the Historic Roanoke Island Fund to provide the 1/3 match to dredge the access canal around Roanoke Island Festival Park (RIFP). This provision will allow for the state to fulfill the commitment of providing a navigable access canal around RIFP. The other 2/3 will come out of the state's Shallow Draft Dredging Fund.
• Continues to appropriate approximately $20 million to the state's Shallow Draft Dredging Fund.
• Provides an additional $300 thousand to support the Eastern 4-H Center in Tyrrell County.
• Permits the N.C. Wildlife Resources Commission to use up to $200,000 for advanced planning of completion and renovations of the Lake Mattamuskeet Lodge and to develop a public/private partnership to facilitate the future operations of the Lodge.
• Appropriates an additional $1 million of funding to the Economic Development Partnership of North Carolina (EDPNC) for tourism advertising - increasing the revised net appropriation to EDPNC is $19.0 million. Currently, for every $1 invested in paid media advertising by Visit North Carolina (a unit of the Economic Development Partnership of North Carolina), the state receives $184 in new visitor spending, $9 in new state taxes and $6 in new local taxes. In 2015, North Carolina's tourism industry outpaced the national growth rate and achieved record performance - domestic travelers spent a record $21.9 billion up from $21.3 billion in 2014.
• Directs the Division of Coastal Management and the Department of Environmental Quality to study and provide an executive summary of readily available data on the physical and economic, storm mitigation, and public safety benefits of beach nourishment. Directs the County Tax Office of each covered county along our state's 320 miles of coastline to identify all privately owned beachfront property, and determine the county residence of the property owner.
• Instructs the Department of Commerce to study and provide an executive summary of readily available economic data related to the coastal economy of the state for the purpose of quantifying the contribution of the coastal economy to the economy of the state as a whole.

    In Agriculture, the budget:

• Allocates $500 thousand for international marketing of North Carolina agricultural products.
• Provides $3 million for a firefighting plane & heavy equipment for the NC Forest Service.
• Provides $1.12 million for the Tobacco Trust Fund and $1 million to the Agricultural Development and Farmland Preservation Trust Fund for military buffers.
• Includes an additional $500,000 for AgWRAP (Agricultural Water Resources Assistance Program).

    "Our state's agricultural sector grew by 10 percent from 2013 - while the overall national average of growth was only at 2.2 percent. In essence, our state is blessed with well over 52,200 farmers, who are the backbone of our state's number one sector - contributing $84 billion to the state's economy and representing approximately 17 percent of the state's income," Cook said.

    In Taxes and Economic Development, the budget:

• Provides an immediate $145 million tax cut this year and an additional $205 million tax cut next year, mostly benefitting middle class families and small businesses.
• Increases the zero percent tax bracket over the next two years - ensuring all North Carolina taxpayers, regardless of income, pay no state income taxes on more of their earnings.
• Creates a new international job recruiting office in the Department of Commerce focused on opportunities in Asian markets and designates close to $4 million for job recruitment advertising in domestic and international markets.
• Enhances rural economic development and job recruitment by placing an economic developer in each of the state's eight regional Prosperity Zones.

    In Salaries and Benefits, the budget:

• Lays the foundation to dramatically increase average teacher pay from $47,783 to $54,224 over the next three years, which will provide North Carolina public school teachers an average $4,700 permanent pay raise over the same period and propel the state to the top of regional rankings. This is in addition to the generous teacher pay raises legislators passed in 2014 and 2015.
• Includes a 1.5 percent permanent pay increase and 0.5 percent one-time bonus for state employees, over $80 million for merit-based bonuses, and a 1.6 percent cost of living bonus for retirees.
• Offers experienced-based step increases to teachers, assistant principals, principals, State Highway Patrol troopers, clerks and magistrates, appropriates $16 million to boost pay for correctional officers, and provides a 4.5 percent pay raise to assistant district attorneys, public defenders and other judicial branch workers.
• Includes $10 million for a pilot program to provide performance-based bonuses of up to $6,800 for third grade reading teachers. $5 million would be available for the top 25 percent of teachers in each school district based on EVAAS growth scores, and an additional $5 million would be available to the top 25 percent of teachers on a statewide basis.
• Establishes performance-based bonuses for Advanced Placement (AP) and Career and Technical Education (CTE) teachers when students are successful in completing AP exams and earning industry-recognized certifications and credentials.

    In Education, the budget:

• Increases education funding by $512 million over the enacted 2016-17 budget.
• Funds K-12 enrollment growth, community college enrollment and public university enrollment.
• Continues the commitment to lower class sizes in the early grades - a step research has repeatedly shown is key to academic success - by hiring close to 450 additional first grade teachers.
• Protects the Read to Achieve, School Connectivity, Teach for America, and Communities in Schools programs from being cut by the Department of Public Instruction.
• Establishes an opportunity scholarship grant fund reserve of $34.8 million to award more need-based scholarships to children from working families and provides forward funding to add 20,000 children to the program over the next ten years.
• Creates a teacher assistant tuition reimbursement pilot program in Anson, Franklin, Moore, Richmond, and Scotland Counties, which will provide tuition reimbursement of up to $4,500 annually for 25 local TAs to pursue a college degree leading to teacher licensure.
• Fully funds teacher assistant positions at the 2014-2015 level.
• Provides that school performance grading (A-F school grades) will continue to utilize a 15-point scale for the next three school years.
• Allocates $10 million to support teacher professional development and technology infrastructure improvements.
• Directs $3.5 million in additional funds to grow the Principal Preparation Program to meet the demand to train new and aspiring public school principals.
• Requires eight public universities with educator preparation programs to open and operate a lab school for K-8th grade students in a school district where 25 percent or more schools are identified as "low performing."

    "Improving educational outcomes for our children is a responsibility I take very seriously. My goal for education is every educator's goal - I want our students in North Carolina to have the best education possible. Boosting teacher pay, increasing the number of classroom teachers and reducing class size will serve our students well," Cook said.

• Authorizes an increase in the base budget for the UNC system of up to $40 million to fund the Access to Affordable College Education Act.
• Guarantees no in-state tuition increases for a standard undergraduate college term (usually 4 years) at all North Carolina public universities, not only providing certainty to families who are budgeting for college costs and taxpayers who heavily subsidize tuition, but also additional incentive to students to complete their degrees on time. This tuition guarantee would also apply to active members of the military based in North Carolina.
• Freezes student fees - often used to fund non-academic expenses - at all North Carolina public universities at current levels and limits future increases to no more than three percent per academic year.
• Lowers tuition at select universities from the mountains to the coast to $1,000 per year for in-state students and $5,000 per year for out-of-state students, ensuring all North Carolinians have an affordable option. This would also help attract new students to universities with lower enrollment, make those schools more stable and competitive and stimulate struggling regional economies that sometimes transcend the state's borders. The reduced tuition would apply to the following schools beginning in the Fall of 2018:
• Elizabeth City State University
• University of North Carolina at Pembroke
• Western Carolina University
• Directs $300,000 on a recurring basis to administer the new Cheatham-White Merit Scholarship Program for students at North Carolina Central and N.C. A&T Universities.
• Provides a community college tuition and registration fee waiver to firefighters, EMS, and rescue and lifesaving personnel at military installations for courses that support their organization's needs.
• Expands an internship program for students at the state's Historically Black Colleges and Universities.

    "Higher education is an invaluable resource for dependable leadership within our communities, state and nation. Holding college tuition and fees down while fully funding our state's institutes of higher learning will ensure the growth and contribution of our colleges for many years to come," Cook said.

    In Health and Human Services, the budget:

• Repurposes a more than $300 million surplus in the Medicaid budget, made possible by Republican-led reforms that have gotten the chronically troubled program back on track.
• Builds a stronger Controlled Substance Reporting System that will use advanced analytics to detect and fight prescription drug abuse.
• Directs proceeds from the sale of the Dorothea Dix property go toward services for the mentally ill, including $2 million to establish child facility-based crisis centers and $18 million to expand inpatient behavioral health beds targeting rural areas. In addition, the budget also appropriates $20 million for recommendations from the Governor's Task Force on Mental Health and Substance Abuse.

    "Back in February, I met with several local county Sheriffs along with the administration of Sentara Hospitals in Northeastern North Carolina to discuss how the state can assist in alleviating issues surrounding individuals who suffer from mental illness and substance abuse disorders. After receiving feedback, it became very clear, we (state) need to expand services available in the field of mental health and addiction. This budget will improve the lives of individuals who suffer from mental illness and substance abuse disorders. Included in this plan is funding for additional behavioral health beds in rural areas and facility-based crisis centers, increased counseling services, and money for preventative public health programs to address the growing heroin and prescription drug abuse crisis," Cook said.

• Contact: Jordan Hennessy
•     jordan.hennessy@ncleg.net