Ballantine offers Alternatives to Hefty Senate Tax Increase
Senate Democrats have
presented a state budget that includes new spending and $1.1 Billion in
new taxes. Senate Republicans unanimously stood against tax increases
and offered numerous amendments to offset new taxes.
"These are common sense alternatives to tax increases," said Senate
Republican Leader Patrick Ballantine, R-New Hanover. "It keeps
promises, rather than breaks promises."
The Senate Democrat spending plan includes income tax increases, a
sales tax increase, a tax on food, a tax on candy, and a tax on soft
The Democrat plan taxes children, and taxes married couples more than
single adults living together, postponing tax relief measures due to
start July 1.
The Democrat budget increases taxes $499.3 million in fiscal year 2004 and $639.6 million in fiscal year 2005.
As alternatives to increased taxes, Ballantine offered an amendment to
save $200 million in spending for vacant positions, save $42 million
consolidating administration of 39 worker-training programs, move $270
million from the Golden Leaf fund, and reduce $3.1 million from the
Department of Public Instruction bureaucracy in Raleigh.
Regarding taking Tobacco settlement money, Ballantine told Democrats,
"we don't touch the Health and Wellness Trust Fund or the Farmer's
Trust fund. You all have already taken that money."
Republicans offered more than enough money to offset the Democrat's new
taxes. The GOP proposed using some of the additional money to restore
funding for teacher's assistants, school custodians and for
prescription drugs for older north Carolinians.
The Republican alternative budget was defeated along Party lines with all 28 Democrats voting against the measure.
In another amendment, Senator Robert Pittenger, R-Mecklenburg
successfully changed the budget by calling for the implementation of a
computer software program that has saved Georgia's Medicaid program
$140 million. Senate Republicans have, for many years, worked to
eliminate waste and fraud from North Carolina's growing Medicaid system.
Senator Fred Smith, R-Johnston, also offered an amendment that would
limit state spending by tying budgets to personal income growth over
the prior decade. "Our state needs to have a plan for strategic
planning, to have discipline," Smith said. "The way we budget creates
inefficiencies." The amendment, he told the Senate would have promoted
"effective and efficient government. It would give citizens confidence
in our government."
Again, the amendment was defeated by all the Democrats in a Party line vote.
Senator Ham Horton, R-Forsyth offered an amendment that would require
reports from more than 8,000 "non-governmental organizations" that
together receive more than $776 million in state funds. Those that
receive larger grants would be required to account for monies spent
with a yearly spending report. Organizations receiving more than
$350,000 in state money are already required to deliver certified
accounts. Horton's amendment would have suspended funding to
organizations that are not in compliance.
Sen. Pittenger also offered an amendment that would have required
random audits of at least 20 of thousands of NGO's, to measure results
and increase accountability.
Sen. Fern Shubert, R-Union, disputed the Democrat's "creative
financing" provisions that would allow the state treasurer to float
credit and bonds in a number of ways she fears would violate the state
Constitution. She offered an amendment to rid the Senate budget of
language that might open up state financing to "the dangers of Orange
County derivatives," citing the notorious example of a California
county made bankrupt by creative financing.
"I concede that the state has been grossly mismanaged," Shubert said. "But 'borrowing long' is not good business."
"The Constitution says we are can't borrow money without permission
from the people," said Sen. Virginia Foxx, R-Watauga. "Creative
financing is not what I was elected to do."
Ultimately the Democrat budget passed a second reading along Party lines, 28 - 22.