Medicaid, Corrections Pay, Incentives: Gov. McCrory Details Parts Of $21.5B Budget

Mar 6, 2015

Governor Pat McCrory is proposing raises for new teachers, tax incentives for corporations and a cut to the University system. On Thursday morning, the governor laid out his budget proposal for the next fiscal year.

Governor Pat McCrory wants raises for corrections officers, new teachers and an $82 million allocation for mental health and substance abuse services. He detailed the $21.5 billion budget yesterday, along with budget director Lee Roberts.
Credit Governor's Office

Governor McCrory detailed his spending blueprint for the fiscal year that begins July 1st. His 298-page, $21.5 billion proposal is just the first step in a long process.

"It’s a conservative budget. It’s a disciplined budget. It focuses on careers and on jobs and on making jobs on more efficient and more accountable," touted state budget director Lee Roberts. He replaced Art Pope last fall.

Roberts and the governor shared a podium Thursday, detailing parts of this proposal. The largest slice of the budget pie belongs to education. It follows up on the Governor’s long standing promise to increase teacher compensation for some.

"When it comes to teacher pay there’s really four elements without getting to far into the weeds … You have an increase in the minimum salary to $35,000. And then you have the movement along the pay scale – and that’s not something to be overlooked. The previous administration froze the movement on the pay scale," Roberts said.

Governor Bev Perdue did freeze the teacher pay scale. And Governor McCrory kept the freeze in place for another two years. On the other two elements of the teacher pay changes – a minimum for experienced teachers, ensuring they don’t face a salary cut and some performance based compensation- McCrory hopes to implement a performance philosophy for all state employees:

"And this is a major change in the culture of state government where we want to reward the high performance and improve those who are performing at the level we expect."


At the university level, funding would be cut by 1.2 percent under the governor's proposal. Another part of the budget puzzle that is expected to face scrutiny is incentives.

"The administration has been clear that nobody like incentives. In an abstract world, we’d all prefer not to have them. We don’t’ live in an abstract world. We live in the real world. And to not have them would be tying both of our hands behind out backs as we try to create new jobs in North Carolina," Roberts said.

This budget proposal calls for $99 million to fund the NC Competes Act, filed in the House last week. Hours after McCrory unveiled his budget, House lawmakers approved the incentives bill and sent it to the Senate for further consideration. One more key theme to this year’s legislative session is what changes might happen with Medicaid which provides healthcare for low-income individuals. This proposal adds $287 million to keep up with growth in Medicaid enrollment. As the Affordable Care Act is again challenged in the nation’s highest court, the governor reiterated his desire to create a state exchange.

"We’re not just stopping, waiting for the Supreme Court case, but we recognize the Supreme Court case could have major ramifications on everything related to healthcare, including Medicaid."

Republicans and Democrats from both chambers did not have many comments about the plan, saying they had not yet had enough time to digest the hefty proposal. In a statement, Senate Leader Phil Berger said he appreciated the governor’s hard work, looks forward to reviewing the plan in greater detail and finding common ground.

Lawmakers in the House and Senate will each write their own budget proposals. Then the sides will work to compromise on a final plan. The goal is completion of a budget by the end of June.