GA Update: Weekly Legislative Recap and Related News

What’s happening around state government? Here’s a recap of activity and how your business will be impacted.
 
Last week, the North Carolina House passed its version of the state budget. As previously discussed, the NC Senate passed its version of the state budget and was awaiting the House to do the same. Both Chambers have laid out their plans to spend $25.7 billion in taxpayer money through the state budget. Both budgets focus on the same topics such as pay raises, education funding, emergency powers, etc. but there are many differences between the two budgets.
​
Some of the differences are listed below:
 

1. Raises for teachers and state employees
   1. The Senate plan includes a 3% raise for almost all state employees including teachers
   2. The House plan has a variety of raises which includes a 5.5% raise for teachers, a 5% raise for state employees, and a 2% bonus for retirees.
2. Tax Cuts
   1. The Senate wants bigger tax cuts now and the House wants lower tax cuts.
   2. The House wants to reduce the individual income tax from 5.25% to 4.99% compared to the Senate budget which proposes the rate go down 3.99%.
   3. In regards to the corporate income tax, the Senate plans to phase it out completely as opposed to the House which plans to lower the tax rate from 2.5% to 1.99%. This will help North Carolina compete regionally for businesses.
3. African American Monument Funding
   1. The Senate budget allocated zero dollars towards the African-American monument on the State Capitol grounds. Funding for the monument was not included in the House budget either but $650,000 was allocated in non-recurring funds for the Freedom Park project. The Freedom Park will commemorate the African-American struggle and experiences in this state. 
4. Emergency Powers
   1. Both the State Senate and House included provisions in their budgets that change the emergency powers of the governor.  The Senate budget includes a provision that would change state law to require agreement from the Council of State within 10 days of the governor issuing an executive order. If approved, the order would then expire 45 days later unless the General Assembly takes action to extend it longer. However, in the House budget, though there is a provision about emergency management, as the House proposal would require documentation of Council of State concurrence on issues that require it, and within 48 hours. These provisions have come about due to the governors powers used during the pandemic.

 
This week the Senate will vote to not concur with the House budget proposal and both chambers will move into a negotiating process. Once a final budget has been approved, it will move over to the Governor’s desk for consideration. We will keep you updated on further action as the budget moves forward.

To learn more about our GA priorities, track legislative bills, or to read our blog posts, you can visit our webpage or follow us on Twitter @RcgaJ, @tierra_rcga, or @raleighchamber.