For the past few years, the North
Carolina General Assembly has used shortfalls in revenue as an excuse to
raise taxes. The economy has improved, and this year the state enjoyed a
revenue surplus of two-thousand four-hundred million dollars
($2,400,000,000).
State lawmakers could have returned
the surplus to the people in the form of tax relief or reductions of
un-funded mandates. Instead, they chose to spend most of the
$2,400,000,000 billion on new and expanded programs.
On July 6, the General Assembly
adopted a budget that increases spending nearly ten percent for fiscal
year 2006-07. Non-recurring revenue was used to fund continuing expenses,
setting the state for yet another tax increase next year.
N.C. Rep. John Blust proposed an
amendment to use part of the surplus to repeal the “temporary” sales
and income tax increases that were adopted in 2001. The leadership of the
House would not allow the amendment to be considered. A motion was made to
suspend the rules to allow Blust’s amendment to be voted on. The motion
was defeated
The budget does include a one-fourth
cent sales tax reduction and a quarter-percent decrease in the income tax
rate for the highest-income taxpayers. These token tax reductions, while
only a fraction of the recent tax increases, will be cited to provide
political cover for the lawmakers who voted in favor of the budget. On the
final vote, the budget passed 31/15 in the Senate and 83/31 in the House.
Every Democrat voted for the budget. Republicans split their votes, with a
majority voting against the budget.
The accompanying chart shows the
votes of the members whose districts include parts of Iredell County. Rep.
Julia Howard voted “no” on the second reading on July 5. The next day,
she voted in favor of the same budget on its third and final reading.
Final vote, 2006-07 NC Budget
Sen. Jim Forrester No
Sen. Austin Allran No
Sen. Fletcher Hartsell Yes
Rep. George Holmes No
Rep. Mitchell Setzer No
Rep. Julia Howard Yes
Rep. Karen Ray Yes
Consider repeal of tax increases
Rep. George Holmes Yes
Rep. Mitchell Setzer Yes
Rep. Julia Howerd No
Rep. Karen Ray No
