Despite warnings from fiscal analysts and Republicans that the COVID-19 pandemic is stretching financial resources, Gov. Roy Cooper’s fiscal 2021 amended budget proposal includes $2,000 in bonuses for teachers and principals as well as bonuses for school support staff and higher education employees.
About $85 million of that $360 million in bonus payments would be taken directly from the state’s private school voucher fund, which provides scholarships to lower-income students to attend private schools.
“The budget I propose takes on the challenges of today while building for the promise of tomorrow,” Cooper said. “We have to rise to the occasion of this pandemic response now and focus on ways to emerge from this crisis stronger than before.”
The plan immediately received backlash from Senate Republicans, who have been at odds with Cooper over state spending.
Sen. Deanna Ballard, R-Watauga, who co-chairs the Senate Education Committee, said Cooper’s plan to appropriate unused funds from the private school voucher program reduces the chances for lower-income children to receive a better education.
“Under the governor’s ‘equity’ plan, only the wealthy can attend private school,” Ballard said.
Cooper last June vetoed North Carolina’s biennium budget, causing the General Assembly to allocate one-time expenses through piece-meal legislation, while recurring costs were funded at previous levels.
Lawmakers plan to return to the General Assembly next week to review the fiscal 2021 plan, and significant changes are expected.
Cooper’s amended budget also includes another attempt at Medicaid expansion, which in part led to last year’s budget standoff, with Republicans sternly opposed.
Cooper also wants to spend a $457 million windfall from last fiscal year that came after more people payed their income taxes in fiscal 2020 than expected after a three-month tax payment deadline extension during the pandemic.
But analysts warned the windfall would not be recurring.
“This amount would not be recurring, and it may put negative pressure on the 2020-21 [revenue] forecast,” fiscal analysts said.
The Senate’s chief budget writer, Sen. Harry Brown, R-Onslow, said Tuesday that spending the money would be “irresponsible, reckless and negligent.”
A similar move by former Gov. Bev Perdue after the last recession led to layoffs and pay cuts for teachers, Republicans said.
State budget director Charlie Perusse said Wednesday he was not concerned that future cuts will result from Cooper’s amended budget.
“We have a balanced budget in fiscal year 2021. We’ve had one based on the actions taken by the Legislature in May and June,” Perusse told reporters. “When we do a revised consensus forecast, we anticipate – hopefully – it might be a little bit better than we originally anticipated.”
Among other things, Cooper’s plan allocates $86.5 million to match federal relief funds for local areas affected by recent natural disasters.
Cooper also proposed increasing weekly state unemployment benefits from $350 to $500 and from 12 weeks to. He also laid out a plan for the remaining $900 million in the state’s Coronavirus Relief Fund.
Hoping to take advantage of the low-interest rates during the current economic climate, Cooper also recommends the state invests in a $988 million limited obligation bond to support health care advances, including vaccine development. He also proposed placing a $4.3 billion bond referendum on the 2021 November ballot for schools, higher education, infrastructure projects and affordable housing.
