
                         THE VIRGINIAN-PILOT
                 Copyright (c) 1994, Landmark Communications, Inc.

DATE: SUNDAY, June 19, 1994                    TAG: 9406160194 
SECTION: CAROLINA COAST                     PAGE: 50    EDITION: FINAL  
SOURCE: Medium 
DATELINE: 940619                                 LENGTH:

MAKING CHOICES

{LEAD} A letter written by Mr. John Sams appeared in The Carolina Coast on June 4th. He has some ideas about taxes and how they should be spent and that is good. But I would like to give him a chance to answer some tough budget questions that we often face in Raleigh.

For the record, I agree with Mr. Sams on his suggestion for some tax relief. That is one reason why the Senate has proposed a permanent tax cut of $24 million from the budget by repealing the intangibles tax.

{REST} Could we offer higher tax cuts now, Mr. Sams? Well, maybe. But my question is which of the following items would you cut because many people in your own community think of these as very important. Let's take a look at the numbers.

There is talk of a billion dollar budget surplus, but the statement is inaccurate. The state has a surplus of $512 million of recurring revenue that we expect to continue in coming years as well as $551 million that is only available this year. These are one-time moneys.

In 1991, North Carolina had a $1.2 billion budget shortfall. As you may recall we cut $600 million from the budget and raised taxes $600 million to avoid bankruptcy. Since we do not want that situation to occur again, the state has adopted several measures to ensure fiscal integrity.

In the Senate budget over $160 million of the non-recurring funds will be saved in a rainy day fund.

Furthermore, $120 million is being allocated to uncook the books and pay all of our salary bills in the same year. In 1991 our administrators put off some bills to the next year by only paying salaries for 11 months and shifting the twelfth month of salaries to the 1992 budget. We need to correct this bookkeeping trick.

An additional $60 million will be set aside for maintenance cost on state-owned buildings. That means $340 million is set aside in the non-recurring budget to maintain North Carolina's fiscal integrity.

North Carolina is one of only four states to have a AAA bond rating and that is because of our fiscally conservative budgets.

In the Senate budget teachers and state employees are to receive a 4% pay raise and 1% performance bonus. I think we should adequately compensate those who support our state and teach our children. The raise is also necessary just to keep salaries ahead of inflation. Would you cut the pay raise for teachers?

Also in the Senate budget is $10 million that will support low wealth and small schools. I understand that you have a place in Tyner. Chowan County receives a portion of the low wealth funds. Is the low wealth school funding the item you want to cut out of the budget?.

The Senate budget provides for over $3.6 million for instructional supplies and materials and another $22.6 million for replacing old school buses. Would you cut supplies and new school buses out of the budget?

Maybe you would like to cut the $2 million that is needed simply to purchase books for our community colleges. Or maybe you would cut the $12.3 million that will be invested in ECU's new medical facility.

Would you cut the $8.7 million for 2,000 new prison beds? Would you cut the $400,000 we need to run inmate work crews and road squads?

Would you cut the $10 million for a modern visitors' center at the birthplace of America, the Elizabeth II state historic site? Would you cut the $10 million for much needed repairs to our state mental health facilities?

Maybe you would cut the 10 million competitive fund that helps to recruit new high-wage jobs to North Carolina. Or, maybe you would eliminate a $1 million fishery grant program that is important to our fishing industry.

Or, maybe you wouldn't spend $25 million to pay interest the state owes on bond issues. Or maybe you would like us to stop construction of Wright Memorial Bridge expansion from two to four lanes.

Which would you cut, Mr. Sams? Would you cut out of the state budget fiscal integrity, education, transportation, health care or economic development?

Are there more savings that can be achieved? Yes. Will I try to find savings and make further cuts in the budget? Yes. Has the North Carolina Senate made budget cuts? Yes.

If you or any of the readers would like to discuss the state budget with me, please call my Raleigh office at 733-6854.

Marc Basnight

President Pro tempore

N.C. Senate

by CNB