When the N.C. General Assembly goes back to work next month, its members face some ugly terrain.
The smooth fiscal pavement of the past few years has turned into a craggy, potholed landscape. Those reliable revenue surpluses that made budgeting a just-say-yes experience in recent years have done something worse than disappearing. They have reversed, creating a deficit. Possibly an unprecedented deficit.
Some General Assembly financial gurus are talking about a revenue shortfall that could run anywhere from $800 million to $1.6 billion for this fiscal year, which ends in June. Some legislators say it could hit $2 billion. Gov.-elect Beverly Perdue’s office said Monday that it could be a lot worse — maybe as much as $3 billion.
If the shortfall is that big, it will hit us all. Unlike the federal government, our state can’t indulge in deficit spending. If we’re $3 billion short, lawmakers and the governor have to cut that much spending.
Cuts of that magnitude will hit us all, in places that hurt. Business as usual isn’t possible when a budget anticipating a $21 billion cash flow falls $3 billion short. That’s nearly a 15 percent gap.
If, like physicians, our lawmakers vow to first do no harm, they need to be brave. They will have to cut some pet projects. They will have to cut some constituents’ pets, too. The budget for the next fiscal year can’t be funding teapot museums, or sending the state’s first couple off to Europe on lavish business-wooing jaunts. (more…)