North Carolina House seeks higher state employee pay, child care and voucher money in budget bill

North Carolina teachers and state employees would receive higher salary bumps than are currently planned, while child care providers could access some financial aid as federal assistance ends in a state budget measure advanced Tuesday by House Republicans.

They are running their own a bill that would adjust the second year of the two-year state government budget enacted last fall because private negotiations with Senate GOP counterparts on a consensus spending plan in recent weeks have faltered. Senate leader Phil Berger has complained that House GOP leaders want to spend more than Republicans in his chamber are willing and from reserves.

So House Speaker Tim Moore decided to run a House-only measure this week to emphasize their priorities and potentially prod senators to act. But the move raises the possibility that legislators could adjourn this summer without a budget law that contains wide-ranging adjustments.

The enacted second year of the budget already has rank-and-file state employees poised to receive 3% raises in the coming year, with teachers on average also receiving 3% raises. But under the $31.7 billion House plan making its way through three committees on Tuesday, state employees would see 4% raises instead, while correctional and probation and parole officers would get 9% raises to reflect recruiting and retention challenges in the fields.

And teachers would instead receive average 4.4 % raises, according to Moore's office, with early-career instructors obtaining the largest percentage increases. First-year base teacher salaries would grow from $39,000 during this school year to $44,000 in the fall — a move to make North Carolina more attractive to new teachers.

The bill also would set aside $135 million in one-time funds to replace child care stabilization grants from Washington that began during the pandemic but are to end come July. It falls short of the $300 million that some child care advocates say are needed. The grants largely have been used to boost worker wages. The Senate has been less inclined to fill the hole.

“We cannot leave Raleigh without addressing the childcare crisis,” Rep. Donny Lambeth, a Forsyth County Republican and senior budget co-chairman, said in a news release, adding that the grants will "keep childcare centers open and parents can remain in the workforce, while giving the state time to develop a more sustainable model for childcare costs.”

The measure does include provisions passed separately by the Senate last month that would provide over $460 million more to the state's Opportunity Scholarship program to help end waiting lists of nearly 55,000 students who are qualified to receive scholarships this fall to attend private K-12 schools. There was a massive increase in program applications after legislators last year did away with income eligibility caps that had limited recipients. The funds also aim to cover the higher demand permanently.

The bill also spends $350 million already within a state Medicaid reserve fund to address a program shortfall and $150 million in another reserve to pay for pricey transportation projects designed for a new Toyota electric battery plant now being built in Randolph County that will employ thousands.

House Republicans planned floor debate and votes the bill on Wednesday and Thursday. The chamber's final proposal would then move to the Senate, which under conventional circumstances would approve its own plan. Negotiations over competing plans would follow. But Berger has suggested that may not happen, telling reporters last week that he may break off efforts to work out an agreement with the House and send the Senate home for an undetermined period if no agreement is reached by June 30.

The new fiscal year begins July 1, but since a two-year budget already in place, the pressure to enact adjustment isn't as urgent. The House bill contains no further income tax reductions beyond those already set to go down next year.

Any final spending measures would go to Democratic Gov. Roy Cooper, who offered his own budget plan in April. He wants raises for teachers and state employees that are higher than what House Republicans seek and hundreds of millions of dollars more for child care and early education initiatives. But Republicans hold narrow veto-proof majorities in both chambers, meaning they don't need Cooper's support if they remain united.