(The Center Square) – North Carolina legislative leaders have reached an agreement on a biennium state budget, but that does not mean the state will start dispersing funds to cover its expenses for the next two years.
House Speaker Tim Moore, R-Cleveland, said Wednesday the House and Senate have agreed on how the state will spend more than $50 billion in the current and following fiscal year after more than a month of negotiations.
Details of the agreement have not been released, and it has been sent to Gov. Roy Cooper's office for review as part of the negotiation process.
Leaders of the General Assembly decided to involve the governor in the process before a final vote to ensure the budget goes into law. Cooper and the Republican-led Legislature have not agreed on a state spending plan since he took office in 2017. The last biennium proposal was rejected by Cooper because he wanted the state to expand Medicaid and increase teacher pay.
"I imagine we will probably see where we run into some sticking points," Moore told reporters. "What I hope is that we don't have a situation like last time where one issue held up the process."
Moore said the budget agreed on Wednesday does not increase spending to allow more North Carolinians to enroll in the state- and federal-funded health care program. However, he said the plan does increase Medicaid benefits for pregnant women.
Cooper made budget recommendations in late March. It proposed the state to spend about $5 billion more over the biennium than the past two years. Each fiscal year starts on July 1 of the previous year and ends on June 30 of the same year.
The House and Senate increased spending in separate proposals. They were passed in each chamber by Aug. 12, but lawmakers have not voted to approve one final version. They have met to negotiate a budget agreement since then and finally have compromised.
Once Cooper and legislative leaders agree on a proposal, the plan is to call the budget for a full vote in both chambers of the Legislature before officially sending it to the governor.
The Legislature's preexisting proposals call for increasing spending by more than 3% each year of the biennium but spending $3.7 billion less than what Cooper recommended. Both plans also include tax cuts and state employee pay raises and bonuses.
One thing Cooper said he would not compromise on is education spending. The governor said Tuesday he would do what it takes for the state to fund a court-ordered plan that ensures North Carolina meets its constitutional obligation to provide each child a "sound basic education."
Representatives for Senate Leader Phil Berger's office said Democrats and the judge who made the ruling are ignoring $5.6 billion in federal aid K-12 schools received in response to the pandemic. Fiscal analysts also predicted the state will collect $6.5 billion more in revenue than expected over the next two years.
The ruling came from the 1997 case, Leandro v. the State of North Carolina, where the plaintiffs claimed students in poor school districts were not receiving the same educational resources as students in wealthy school districts. They argued the state was not doing what it took to ensure each child had a "sound basic education" required under the state constitution.
The final plan, approved by the court June 7, requires the state to spend nearly an additional $700 million this fiscal year and more than $1 billion more next fiscal year on education. Cooper's proposed budget fully funds the program, but the Legislature's previous proposals fall short of the spending requirements.
Moore said Wednesday he doesn't expect the Legislature to vote on the budget next week, but maybe the following week. In the meantime, North Carolina is operating under existing funding levels for recurring expenses because of state law.