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News Franklin Mayor endorses Governor Perdue’s sales tax proposal

Mayor Joe CollinsSenator Davis says no way.

First-term North Carolina Governor Beverly Perdue (Democrat), who announced last week that she will not seek a second term in office, recently proposed a 3/4 cent sales tax increase in order to prevent deeper cuts to public schools for the 2012/13 fiscal year. A one cent sales tax hike was previously enacted by the 2009-2010 General Assembly as a way to offset declining revenues caused by the Great Recession. The GOP campaigned on killing the tax increase during the 2010 electoral season, and eventually swept into office for the first time in more than a century.

Inevitably, Republican legislators sparred with the Governor when she proposed to keep 3/4 of the sales tax increase intact in her proposed 2011-2013 state budget last year. However, with the help of five House Democrats, Republicans passed their own budget, which let the temporary one cent sales tax increase and income tax surcharges sunset. By gaining the support of a few Democrats, Republicans were able to override the Governor’s veto, and set into motion a Republican budget plan for the first time since the Reconstruction era.

Now, after $250 million of federal stimulus money has dried up for the state’s public school system, Perdue is calling on the legislature to increase the state’s sales tax rate from 6.75 cents to 7.50 cents for the second time in less than a year. The Governor believes the measure would raise approximately $850 million for public schools in dire need of additional funding.

After Perdue announced her proposal on Jan. 18, 53 town mayors from across the state, including Franklin Mayor Joe Collins, signed a letter endorsing her proposal. “As mayors, we know that education is the key to our children’s future and to North Carolina’s economic future. Investing in education is central to our ability to attract new jobs and businesses to our state. When companies talk about moving here or expanding, their first question is whether we have the educated, skilled workforce they need,” reads the letter signed by the 53 municipal leaders.

“The legislature’s budget has hurt education at all levels — from pre-k all the way through higher education — and has led to higher class sizes and the loss of teacher and teaching assistant positions right here in our local schools. With their budget forcing even more teacher layoffs next year, we must act to prevent these additional cuts. We owe it to our children and our state to stop these cuts to our schools and make education a priority again — a fraction of a penny for progress,” concludes the letter.

There are over 540 towns in North Carolina, which may or may not demonstrate the letter’s overall representation of North Carolina’s mayors. No information was given on how the letter was configured.

Nevertheless, Mayor Collins believes education is a top priority that state lawmakers cannot ignore when they reconvene for their short legislative session in May. “A good, quality education is an absolute necessity for our children,” said Collins when asked about the Governor’s proposal and his endorsement. “If the money is going towards our schools then I’m for it. I think supporting our school system is essential for the future of this state and the economy,” he said.

According to the state’s Department of Public Instruction, 2,148 public school employees from prekindergarten through 12th grade were laid off in the 2011-12 school year. More than 530 teachers were given pink slips. However, unlike many school districts across the state, Macon County Schools (MCS) have kept all of their employees on the payroll thus far. Yet, without federal stimulus dollars for the next fiscal year, school board officials will be facing some tough decisions this spring when they put their 2012/13 budget together.

Macon County Commissioners have agreed that keeping teachers and teacher assistants in the classroom is a top priority going into the next fiscal year. Commissioner Chairman Kevin Corbin was explicit about this priority at the county’s continuation meeting on Jan. 14. Furthermore, county manager Jack Horton told board members that they may have to provide some additional funding for the school system in next year’s budget, depending on what happens at the federal and state level in the upcoming months.

The odds that the tax increase will be implemented are slim to none. Republican Senate leader Phil Berger stated that Perdue’s proposal was “dead on arrival.” Given the Republicans’ large majority in the legislature, Berger’s assertion will likely be the outcome, although Perdue has said that she is more than willing to take on the GOP in another round of budgeting debates.

Western North Carolina state Senator Jim Davis (R-50) shares Bergers’ sentiment about Perdue’s tax proposal. “When we reconvene for our short session we are going to reevaluate the revenues coming into our state and go from there,” said Senator Jim Davis. “We’ve got to look at some Medicaid expenses that are going to be difficult to deal with, and that is just one of our problems. This is still a fragile environment. This economy is very tenuous and I don’t think raising taxes is the answer,” he said.

Davis explained that his main educational priority for this year will be to keep investing in grades 1-3. “Research shows that if a child is not reading and learning at grade level by the fourth grade, they are much more likely to fail later on. So we have to keep that in mind when we examine our education budget,” he said. More than half of North Carolina’s budget supports public education, so budget reductions had to be enacted last year if the legislature was going to submit a balanced budget, explained Davis. “We couldn’t use budgeting gimmicks to hide our shortfall with federal dollars,” he said. “Our fiscal house was a mess and tough decisions were necessary. We still have a lot of work to do.”

Davis said that he does not envision a sales tax increase this year, no matter how hard Perdue and the Democratic minority lobby for the hike. “These are tough times. I do believe that a lot of regulations need to be streamlined and we need to eliminate a lot of the bureaucracy that exists within our state government, but it’s not easy. It never is. I didn’t go to Raleigh wanting to cut programs, but we’re broke. We had to balance the budget without federal stimulus dollars and without raising taxes, and we did. But we have to face the economic reality and the consequences of the actions of past General Assemblies if we’re going to fix this problem. I think it’s immoral to pass on so much debt to our children,” said the Senator.

Senator Davis recently met with MCS Superintendent, Dr. Dan Brigman, to talk about this year’s budget, and what MCS needs for the 2012/2013 school year. “We met and talked about the district’s needs, and we continue to speak periodically,” said Davis.

Dr. Brigman believes Perdue’s proposal should be considered by state lawmakers, saying the state “must access additional revenues to support education and the future of our children,” he said. “We shouldn’t be satisfied with being 49th in the nation in per pupil spending for education,” he said. “Our children deserve our support, and it is absolutely essential for the economy, jobs, and for our future leaders to have access to a quality education.”

Dr. Brigman thinks state Republican lawmakers should reconsider their stance on not raising taxes, especially since they let the state’s gasoline tax increase by four cents going into the new year. “I find it difficult to comprehend why they would let taxes rise to support our roads, but they can’t raise taxes by 3/4 of a cent to support our children and public education in North Carolina,” he said. “We have a tremendous obligation to our children, who will be the future leaders of our communities and state,” he said.

Local public school districts have to send $503.1 million back to the state to comply with this year’s budget reversion. Macon County Schools’ share of that reversion is $1.4 million, and school board officials and MCS administrators will be meeting on Feb. 2-3 to discuss how they are going to handle the shortfall.

The state Department of Public Instruction claims that $250 million of federal funds is supporting 5,000 jobs for the present school year. That money will be gone by June. If Perdue’s claim that her proposal would raise $850 million for next year is accurate, it would more than make up for the shortfall.

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