RALEIGH, N.C. — Gov. Roy Cooper on Thursday called for freezing tax cuts supposed to take effect next year for businesses and wealthy individuals to free up money to give every public school teacher in North Carolina a raise of at least 5 percent.
The proposal was part of Cooper’s $24.54 billion state budget for the fiscal year that starts July 1.
Republican legislative leaders immediately rejected the plan in favor of their own, which would spend less money overall and includes smaller raises for teachers. They have pointed repeatedly to phased-in tax cuts, which are set to continue unless Cooper has his way, as an important part of North Carolina’s economic upsurge.
“What we are hearing appears to be more of an unserious attempt to score political points in an election year than a responsible, sustainable budget for 10 million North Carolinians,” Senate President Pro Tem Phil Berger and House Speaker Tim Moore said in a joint statement.
“There’s a lot of things in this budget they should adopt if they want to do the things they talk about,” Cooper said during a news conference to roll out his proposal.
The governor’s budget would also expand Medicaid, another idea that’s dead on arrival at the GOP-controlled legislature. He included 2 percent raises for state employees, or $1,250, whichever is larger, plus an extra $1,000 raise for law enforcement officers and people who work in institutional settings, such as mental hospitals.
That’s 33,000 people, including correctional officers and others working in the state’s prison system. Cooper said the $300 million package for employees would be the largest raise they’ve had in a decade.
State retirees would get a 1 percent cost-of-living adjustment.
“The governor’s decisive action is a significant and long overdue step toward lifting many public employees out of poverty wages, especially those who serve our most vulnerable citizens or protect us from harm,” Robert Broome, executive director of the State Employees Association of North Carolina, said in a statement.
Cooper’s plan calls for an average 8 percent raise for teachers, with some getting up to 14.8 percent. The General Assembly’s plan includes teacher raises more in the range of 5 to 6 percent, on average.
The biggest difference between the two is for teachers with 25 years of experience or more. Cooper’s plan would include these educators, who make up 13 percent of the statewide teaching force, and the governor said the GOP plan doesn’t include raises for them.
Moore, R-Cleveland said Monday that veteran teacher salaries are something the legislature needs to look at, but he didn’t promise action. Berger, R-Rockingham, said teachers may see other “revenue enhancements” added to the budget legislators will write in the coming weeks, but they’re more likely to be “of the bonus variety … for specialized situations.”
Freezing the corporate income tax rate at 3 percent and the individual rate at 5.499 percent for incomes above $200,000 a year would free up $110 million next year and $260 million the following year to cover the raises, Cooper and his budget director, Charles Perusse, said. Perusse said 75 percent of the benefit in corporate tax cuts goes to out-of-state companies.
“It’s tax fairness for teacher pay,” the governor said.
The corporate tax rate is scheduled to drop to 2.5 percent in 2019, while the individual rate is set to drop to 5.25 percent. Perusse said 95 percent of North Carolinians would fall into the 5.25 percent bracket under Cooper’s plan, and that wealthy people would still get some tax relief because all income up to $200,000 would be taxed at the lower rate.
In addition to the across-the board raises, Cooper called for $385 bonuses for veteran teachers and a $150 allowance per teacher for school supplies. Principals would be in line for an 8 percent raise, he said.
“North Carolina should treat educators like the professionals they are,” Cooper said. “They shouldn’t have to take to the streets to get the respect they deserve.”
An estimated 15,000 teachers are expected to march on the Legislative Building next Wednesday when the General Assembly reconvenes. Republican Superintendent of Public Instruction Mark Johnson said Thursday that he was “pleased with many of the education items in Gov. Cooper’s budget request,” including $25 million Cooper requested for new textbooks and digital learning. Johnson called the teacher raises Cooper proposed “very similar” to the General Assembly’s plan and said the “developing bipartisan consensus” would surely lead to a fifth straight year of raises.
Cooper previously rolled out his plans for $130 million to address school safety and youth mental health, and on Thursday, he urged lawmakers to put a $2 billion school construction bond on the November ballot.
“His plan puts more textbooks in the hands of our students, enhances the well-being of our students with more school nurses, social workers, and counselors, and puts us back on track to get educator pay and per-pupil funding to the national average,” North Carolina Association of Educators President Mark Jewell said in a statement of Cooper’s proposal.
Cooper wants to restructure the Unemployment Trust Fund, which he said would lower the rate businesses pay into the fund and would free up the $60 million he has said he wants for workforce development programs.
He also wants $20 million set aside to expand broadband service in rural areas, another $140 million for Hurricane Matthew recovery and $14.5 million to address GenX contamination and water quality.
The governor would boost the state’s film incentives program in his budget, create new teams in the Department of Public Safety to address safety issues in state prisons, includes $2.1 million to address the backlog on sexual assault test kits, and restore some of the cuts legislators made last year to the Attorney General’s Office.
Cooper also included $1.8 million in the capital budget to design and build an African-American monument on the State Capitol grounds, something discussed for years.
The governor would also re-dedicate proceeds from the deed stamp tax to various trust funds, instead of that money going straight to the state’s general fund. Conservation and affordable housing programs would get a boost under that plan, which drew praise Thursday from the N.C. Sierra Club.
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