Governor Perdue’s budget proposal kind to counties

• Perdue's recommended budget presentation (PDF)

Governor Bev Perdue released the first budget proposal of her administration March 17, and the proposal continues allocating the lottery and ADM corporate income tax school construction dollars to counties for the upcoming biennium. Mental health community services would receive additional monies to purchase local psych beds. Federal stimulus dollars and state appropriations would make significant personnel improvements in probation and parole. And to reassure counties, the budget did not interfere with the final phaseout of the Medicaid relief swap.

Overall, the governor’s proposed $21 billion general fund budget is $360 million below authorized levels for 2008-09. Federal stimulus dollars and a recommended increase in sin taxes would help close the projected $3.4 billion budget gap, along with $1.3 billion in spending cuts each year of the biennium. Much of these cuts result in budgeting state salaries at historic spending levels. No across-the-board salary increases are recommended for state employees, although teachers would receive a one-step increase, or 1.8 percent on average.

Despite considerable cuts in state spending, including 20 programs recommended for elimination or reduction, the budget did not contain major cuts to county governments and county programs. Generally, any state aid to non-state entities such as the Criminal Justice Partnership Program and the Juvenile Crime Prevention Council is subject to a 7 percent reduction. The Clean Water Management Trust Fund would be cut 25 percent, or $25 million, in both years of the biennium, to be restored to its statutory level of $100 million in 2011-12. State aid to counties for social services administration of $5.5 million would be eliminated each year in the biennium, to be restored as a recurring appropriation in out years. (The State Office of Budget and Management did guarantee that the federal stimulus dollars for additional food stamp administration ($9 million) and foster care services ($3.5 million) would be passed down to counties to offset these cuts.)

Public schools are asked to identify $144 million in local cuts based on a reduction in per average daily membership – schools are encouraged to use additional federal stimulus dollars to offset classroom impacts. Central office allotments would be cut by 5 percent.

Governor Perdue did recommend the closing of seven high-cost state prison facilities.

NCACC staff will be combing through the seven volumes of the governor’s budget proposal to more closely identify county and community impacts. After a joint full appropriations meeting to hear the budget proposal in general outline, appropriation subcommittees begin the review in earnest March 18.