Democratic Gov. Beverly Perdue told the Republican-controlled General Assembly on Monday that the state’s budget problems will not stop her from fighting to protect teacher jobs, seeking to recruit more companies and reworking state government. “Hear me now: I will not back down from those priorities,” Perdue said in her second State of the State address. “I will not play partisan politics, and I will reach across the aisle day after day to find compromise.” It was her first such address since the GOP rode to its first complete majority in the General Assembly in more than a century. Perdue gave some snippets of the two-year state government spending proposal she’s expected to roll out later this week. She said she would “fund every current state-supported teacher and teaching assistant position.” She also wants to revive a 2008 gubernatorial campaign pledge to offer high school students with good grades a free two-year college degree. But she gave few details about what she intends to cut to close a projected budget gap that has fallen from $3.7 billion to $2.4 billion in less than a week partly due to an improved revenue picture and new cost savings found by her budget office.
Perdue talked up a previously announced government reorganization that could reduce the number of state agencies from 14 to eight. She also said she’d offer an early retirement package that could eliminate 1,000 positions. The new Republican leaders were pleased when she said she wants to lower the corporate tax rate from 6.9 percent to 4.9 percent, which would be the lowest marginal rate in the Southeast. “Right now, we have the highest corporate tax rate in the Southeast. That means our businesses are paying more taxes when they could be creating jobs,” Perdue said while also announcing she wants to offer more robust incentives for small business and “green” industries.
But GOP lawmakers wanted more budget details from her and wondered aloud how she could pay for this and the other programs without extending a pair of temporary taxes approved in 2009 by Democrats to close that year’s gap. The GOP is committed to letting the higher sales and income taxes expire, said Senate leader Phil Berger, R-Rockingham, who delivered the official Republican response to Perdue’s speech. Perdue didn’t discuss those taxes, which would generate another $1.3 billion if left in place. “I’m concerned about some of the promises that were made,” Berger said. “I think that’s one of the ways we’ve gotten into the mess that we’re in now, by promising to do things and not having the money to pay for them.” Republicans said unemployment still hovers nears 10 percent in North Carolina, and Berger blamed “inefficient, irresponsible” policies by Perdue and Democrats and high tax rates for part of the economic problems.
While nearly everyone knows somebody who is unemployed, Perdue said the state is doing better than it was two years ago. She said businesses have pledged to create 58,000 jobs and are investing $12.5 billion in the state. “Two years ago we stood at the precipice of economic disaster,” Perdue told the legislators in the speech, televised statewide. “We squared up and put the bat to our shoulder, and swung hard. And two years later, North Carolina is winning this game.” Senate Minority Leader Martin Nesbitt, D-Buncombe, said he was pleased to hear Perdue’s ideas and believes the improving economy could mean more opportunities than previously projected. “I think her priorities are in order,” he said.(Gary D. Robertson, THE ASSOCIATED PRESS, 2/14/11).
