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The Devil’s in the Details: Public Education

The Devil's in the Details

This article is the first in a series contrasting budget cut options identified by NC General Assembly joint appropriations subcommittees with revenue options that would preserve decades of public investment in the economic and social advancement of North Carolina.

Legislative leaders announced their intent to cut $1.4 billion from the state’s education budget next year, which is $763 million more than all cuts proposed in the Governor’s budget. To put the legislature’s proposal in perspective, $7.9 billion of the state’s $11.9 billion education budget is spent on public schools, making the public school budget the single largest state expenditure in any given year.

The spending cuts below represent a selection of “options” under legislative consideration, which are presented to illustrate the severity of a “cuts-only” approach to balancing the North Carolina budget. A balanced approach to the budget shortfall would include raising revenue, which would save thousands of education jobs and preserve educational services for all North Carolina schoolchildren.

The legislature is considering
the following budget cuts …
… but instead of making cuts,
they could:
$332.6 million
Increase class size by two students in all grades,
cutting 6,062 education jobs
$640 million
Apply state sales tax to all consumer services and
reduce state sales tax rate from 4.75% to 3.85%
$258.6 million
Eliminate all teacher assistants except in grades K-1,
cutting 8,694 jobs
$81.0 million
Eliminate More at Four pre-kindergarten program
that serves more than 30,000 4-year-old children
statewide and is proven to improve reading comprehension
$79 million
Retain 3% personal income tax surcharge on
households with joint taxable income above $250,000
(above $150,000 for single)
$55.2 million
Cut instructional support for schools by 12%,
eliminating 893 guidance counselors, social workers,
librarians, and other school personnel
$43 million
Retain 2% personal income tax surcharge on
households with joint taxable income between
$100,000 and $250,000 ($60,000 to $150,000 single)
$9.2 million
Eliminate all Child and Family Support Teams composed
of nurses, social workers, mental health professionals
providing support in 79 high-need high schools
$10 million
Eliminate sales tax cap on expensive boats
and private aircraft
$23.9 million
Cut state support for public school students with
disabilities, reducing federal aid in the process
$22.5 million
Eliminate tax subsidy for film and television
productions in the state
Total Spending Cuts: $760.5 million
Total Public Education Jobs Lost:15,649
Total Revenue Increase: $795 million
Total Public Education Jobs Lost: Zero

— Brenna Burch and Edwin McLenaghan, Public Policy Analysts, NC Budget and Tax Center

References:

Joint Appropriations Subcommittee budget cut options for public education are available at http://www.ncleg.net/documentsites/committees/JointAppropriationsEducation2011/2011-03-08pm%20Meeting/FRD_2011PubSchBudgetReductionOptions_2011_03_08.pdf

Revenue options are based on NC Budget & Tax Center calculations, data provided by the Institute on Taxation and Economic Policy (ITEP), and the NC Department of Revenue’s Biennial Tax Expenditure Report available at http://www.google.com/url?sa=t&source=web&cd=1&ved=0CBgQFjAA&url=http%3A%2F%2Fwww.dornc.com%2Fpublications%2Fnc_tax_expenditure_report_09.pdf&rct=j&q=dornc%20tax%20expenditure&ei=Sw-KTdrjD8OCtge3uZCGDg&usg=AFQjCNE4txFtjvg3kh7URG_dMI3pPSZP7A&sig2=9Q8V_jvdSbzmCzMFx0e1Gw&cad=rja