North Carolina state budget

From Sunshine Review

National Taxpayers Union
Transparency in your state Public employee salary States with spending online Collaborative transparency projects Model transparency legislation #statebooks on Twitter SMTS on Twitter
Action center
Sign up for e-updates Take action

North Carolina faced a $1.7 billion budget deficit for FY 2010,^[1] July 1 2009-June 30, 2010. The original recommended appropriations for FY 2009 from the North Carolina Office of Management and Budget was $21.4 billion before multiple revisions and amendments as revenues declined.^[2] The North Carolina General Assembly met for over six months (January 28-August 11)^[3] and well past the start of the fiscal year to finally pass a balanced budget on August 5, 2009 and signed by Gov. Bev Perdue on August 7, 2009.^[4]

Gov. Perdue issued an executive order on July 24, 2009 to severely restrict state appropriations for the interim until a budget was passed, which was replaced by another executive order on August 14, 2009 that "reduce monthly allotments by five percent of each state agency’s certified budget."^[5] The final $19 billion FY 2010 budget ($20.7 billion with $1.69 billion in federal funds used to supplement state spending, especially in education and Medicaid included)^[6]:^[7]

• Nearly $2 billion in cuts
• $1 billion in federal stimulus money
• Almost $1 billion in higher taxes and fees including: ^[8]
  • 1-cent Statewide Sales Tax Increase; cost to Taxpayers: $803.5 million
  • Sales tax on online purchases, digital downloads of items like songs and movies may be subject to sales tax effective Jan. 1, 2010
  • Online sales made by referrals from N.C. website owners
  • Personal income surcharge; cost to Taxpayers: $172.8 million
  • 3 Percent Surcharge on Corporate Income; cost to Taxpayers: $23.1 million
  • Tobacco products excise tax increase to 45 cents a pack
  • Alcohol excise tax increases
• 700 state job positions eliminated

[edit] Budget Background

The FY 2010 budget appropriations include:^[9]

• 7.456 billion for the Department of Instruction
• $999 million for the community college system
• $2.7 billion University of North Carolina
• $3.9 billion Health and Human Services

FY 2011 General Fund state budget will be $19.55 billion.^[10]

North Carolina operates on a biennium, covering two fiscal years at a time. The 2009-2011 biennium consists of year 1, July 1, 2009 to June 30, 2010, and year 2, July 1, 2010 to June 30, 2011. North Carolina ’s constitution requires that the budget enacted by the general assembly be balanced. In the second year of the biennium, the Office of State Budget and Management develops the governor’s recommended adjustments to the biennial budget. The governor releases a recommended budget every other year in February but still makes an annual update, usually in May. Once both the House and the Senate review and approve the document, then the bill is submitted to the governor for final approval.^[11]

[edit] Budget figures

• See North Carolina state budget (2008-2009) for more details.

[edit] Accounting Principles

North Carolina Office of the State Auditor prepares and publishes audit reports as independent evaluations of the state's financial records and public program performance. Beth A. Wood was elected State Auditor in 2008.^[13]

The Office of State Controller (OSC) functions as North Carolina’s Chief Fiscal Officer and supervises or manages the state’s accounting, financial reporting, disbursement activities, and the implementation and monitoring of internal controls. As part of its statutory authority, OSC is responsible for the uniform NCAS and related subsystems, which maintain timely, reliable, accurate, consistent, and complete accounting information on the State of North Carolina government entity. July 15, 1986, the North Carolina General Assembly created an independent Office of the State Controller to provide control over the expenditure and disbursement of funds on a statewide basis. Thus, North Carolina became the 50th state to establish a state controller function under Chap. 1024, 1986 Sess. Laws (H. 2136). In April 2008, Governor Michael F. Easley nominated David T. McCoy for the position of State Controller. The nomination was unanimously approved by the North Carolina General Assembly and McCoy assumed his responsibilities as the fifth Controller in North Carolina history on September 1, 2008.^[14]

The Institute for Truth in Accounting (IFTA) rates North Carolina “Timely” in filing the state’s Comprehensive Annual Financial Report (CAFR) – The annual report of state and local governmental entities. IFTA rated 22 states timely, 22 states tardy, and 6 states as worst. IFTA does not consider North Carolina's CAFRs, and those of the other states, to be accurate representations of the state’s financial condition because the Generally Accepted Accounting Principles (GAAP) basis does not include significant liabilities for the pension plans and for other post employment benefits, such as health care.^[15] North Carolina's CAFRs are prepared and published online by the North Carolina Office of State Controller.^[16]

[edit] Accounting transparency checklist

Comprehensive Balanced budget Timeliness Usability

[edit] The good

• The website has Comprehensive Annual Financial Reports (CAFR) dating back to 1997.^[18]
• An independent auditor’s report is published on page 26 of the document.^[19]
• It provides supplements to the budget workup, starting on page 172.
• The budget is posted using organized and consistent methods of financial reporting.
• North Carolina law requires a balanced budget and a deficit is forbidden.^[20]
• It includes all costs incurred by the government, including long-term liabilities, starting on page 234 of the document.^[19]
• The CAFR compares estimated and actual budgetary numbers, such as on page 176 of the document.^[19]
• The North Carolina office was timely in submitting the budget.

[edit] The bad

• The CAFR is posted in a PDF format, so it’s not searchable online.

[edit] Economic Stimulus Package

North Carolina is expected to receive $7.8 billion from the $787 billion dollar economic stimulus.^[21] All told, the federal stimulus plan would create or save 105,000 jobs in North Carolina, based on White House estimates.^[22]
For more information on how the federal stimulus funds are being used in the state of North Carolina, visit the state recovery website.

According to preliminary reports, North Carolina is expected to receive:^[21]

• $132 million for weatherization
• $917 million for Medicaid 2009
• $1.3 billion for Medicaid 2010/11
• $736 million for highways and bridges
• $14 million for Head Start
• $77 million for Title 1 (school improvement)
• $16 million for technical assistance
• $44 million for dislocated workers
• $11 million for employment service
• $83 million towards public housing

[edit] Budget transparency

North Carolina became more transparent in 2009 after the launch of NC Open Book spending transparency.

Prior to the launch of NC Open Book, the Office of the State Auditor established a searchable database that reports on private organizations receiving state funds. The database is available here.

[edit] Website evaluation

Budget Usability Elected Officials Administrative Officials Ethics Audits Contracts Lobbying Public records Taxes

NC.gov is the website for the state of North Carolina.

• Main article: Evaluation of state websites

[edit] The good

• State tax information is provided.^[23]
• Elected and administrative officials are listed with contact information.^[24]
• Audit reports are available.^[25]
• Budget is published.^[26]

[edit] The bad

• Site has a search function but is somewhat difficult to navigate.
• Current state contracts are not provided.
• Does not provide information on ethics, lobbying, and how to request public records under the North Carolina Public Records Law.

[edit] Legislation

• North Carolina Executive Order No. 4 (2009), signed by Bev Perdue on January 12, 2009, mandated the creation of a website to make available information about state grants and contracts. The site is managed by the Office of State Budget and Management and the Office of Information Technology Services.^[27]

Office of the State Auditor: North Carolina’s Office of the State Auditor provides residents with in-depth grant information. Thanks to an increase in reporting requirements that became effective in 2005, all nongovernmental entities receiving state or federal “pass-through” grants must complete reports on how the funds were used (previously, organizations receiving less than $15,000 do not have reporting requirements).

Upon receipt of those reports, the State Auditor issues a yearly grant report with summaries by fund source, agency, county, and service type. In fiscal year 2006, North Carolina gave private organizations $606 million in grants, yet over a quarter of all grants had none of the reports required of beneficiaries on how the grant money was used. In order to spur compliance, the Auditor’s office publishes a monthly reporting noncompliance list.

While the information currently focuses on private-sector grants, the Auditor’s office works with the Local Government Commission to establish a similar report for grant funds going from the state to local governments.

[edit] Government tools

The following table is helpful in evaluating the level of transparency provided by a state spending and transparency database:

Criteria for evaluating spending databases

State Database	Searchability	Grants	Contracts	Line Item Expenditures	Dept/Agency Budgets	Public Employee Salary
NC Open Book
Private Companies Receiving State Funds Site

[edit] Limitations and Suggestions

NC Open Book does not list state employee salaries, nor does it provide line-item expenditures.

A user name and password are required to view the Private Companies Receiving State Funds site.

[edit] Economic Stimulus Transparency

• The American Recovery and Reinvestment Plan of 2009 designated $787 billion to be spent throughout the U.S. Of that $787 billion stimulus package, it is estimated that 69%, or over $541 billion, will be administered by state governments.^[28]

• North Carolina will receive an estimated $4,019,461,548 ^[29]

• The economic recovery website to show how legislators and government officials in North Carolina are spending Federal funds is available here.

[edit] Error in ARRP

On November 16 and 17, 2009, many errors were found in the $747 billion plan that showed the plan set aside money for districts that do not exist. According to Recovery.gov, the plan shows its funds will go to 884 Congressional Districts, though there are only 435.^[30][31]

North Carolina has distributed more than $5.7 million in federal stimulus money to six congressional districts that do not exist, according to ARRP's website.

The labels for the districts include 00 and 91.^[32]

[edit] Public employee salary information

Information about North Carolina's state employee salaries is available at this link. The Charlotte Observer obtained this information from the North Carolina Office of State Personnel.

[edit] See Also

North Carolina taxpayer-funded lobbying

[edit] External links

[edit] Additional reading

[edit] References

v • d • e State Budgets Cost of state transparency websites • State budget issues, 2009-2010 • Pubic employee salaries • States with spending online • Glossary of state budget terms Alabama • Alaska • Arizona • Arkansas • California • Colorado • Connecticut • Delaware • Florida • Georgia • Hawaii • Idaho • Illinois • Indiana • Iowa • Kansas • Kentucky • Louisiana • Maine • Maryland • Massachusetts • Michigan • Minnesota • Mississippi • Missouri • Montana • Nebraska • Nevada • New Hampshire • New Jersey • New Mexico • New York • North Carolina • North Dakota • Ohio • Oklahoma • Oregon • Pennsylvania • Rhode Island • South Carolina • South Dakota • Tennessee • Texas • Utah • Vermont • Virginia • Washington • West Virginia • Wisconsin • Wyoming •

	v • d • e State of North Carolina Raleigh (capital)
Transparency	Public Records Law | Transparency Checklist | Government corruption reports | Transparency Legislation | Open Records procedures | Transparency Advocates | Transparency blogs | State budget | Taxpayer-funded lobbying associations |
Divisions	State | List of Counties | List of Cities | List of Towns | List of School Districts | Evaluation of county websites | Evaluation of city websites | Evaluation of township websites | Evaluation of school district websites |
Government	North Carolina State Constitution | Executive | House of Representatives | Senate |
Judiciary	North Carolina Supreme Court | Court of Appeals | District Court | Family Courts | Judicial Nominating Commission | Judicial news |
Ballot Measures	Ballot measures | List of local ballot measures | Procedures for qualifying an initiative | Vote fraud |