(The Center Square) – A proposal to spend $1.9 billion more than he proposed 13 months ago has been offered by first-term Democratic Gov. Josh Stein in a $35.44 billion state budget for fiscal year 2027.
In March of last year, Stein unveiled a spending plan of $67.9 billion for two years – $33.65 billion in 2025-26 and $34.35 billion in 2026-27. Republicans have majorities in both chambers of the General Assembly, meaning the plan has little chance of full success.
Stein, in a press conference Tuesday, did as his predecessor – now U.S. Senate candidate Roy Cooper – by presenting arguably a fearmongering rhetoric about where the state stands. He lauded the accolades of top state to do business, increasing population and destination for a home by residents leaving other states in the same breath of saying “the winning formula” is at risk.
He cited public education, public safety, health care, inflation, Hurricane Helene and federal mandates increasing state and local government costs.
In 2023, left-leaning CNBC awarded the state a second straight top ranking for the America’s Top States for Business. Cooper, father of a daughter graduating from private school St. Mary’s, said Republicans were “short-changing” public schools and were pushing legislation “that puts culture wars in classrooms.”
He said the state needed to follow his lead and policy, that if not, “we’re going to have some problems in the future.”
Last July, North Carolina was No. 1 for the third time in four years. The state is top three for growth annually this decade, and universal school choice remains immensely popular and welcomed by those moving into the state.
Stein’s plan would keep pattern for spending the most on education (55.5%, at $19.66 billion) and Health and Human Services (27.4%, at $9.71 billion). Judicial and public safety (12.1%, at $4.28 billion) is the other area at 10% or more of the total.
Raises would be forthcoming to state employees (2.5% in fiscal year 2026, 2.5% in fiscal year 2027) along with a bonus ($1,000) to all and another $500 to those making less than $75,000. Teacher pay would rise to 11%.
Stein wants ongoing progressive tax cuts stopped. Today personal income tax is 3.99% and corporate income tax is 2%.
In 2010, when Republicans took majorities in both chambers of the General Assembly for the first time in 140 years since Reconstruction, North Carolinians were on an individual income tax system with rates of 6%, 7% and 7.75%, with potential for a surtax on higher earners, and corporate income tax rate of 6.9% with corporations subject to a franchise tax.
“North Carolina’s people are our greatest asset, and when they succeed, we succeed,” said Stein. “We must make fiscally responsible decisions now to keep our schools strong, our communities safe, and our economy working for every person. This budget is a balanced, forward-looking plan to secure our future, lower costs, and ensure that every North Carolinian has a shot at real prosperity.”
