News: CJ Exclusives

House Budget Proposal Redirects Tobacco Settlement Funds

Plan continues funds for culinary school, cuts funds to Planned Parenthood

House Republican leaders rolled out a proposed spending plan for the new fiscal year Wednesday morning that includes significant changes to the allocation of North Carolina’s tobacco Master Settlement Agreement.

Under the budget plan, the Golden LEAF foundation would lose its $68-million allotment next year, and the Tobacco Trust Fund and Health and Wellness Trust Fund would be abolished. All three groups are the result of a multistate settlement of a lawsuit against tobacco companies in 1998.

The funds are meant to help tobacco farmers harmed by the crop’s declining fortunes, but in recent years critics have cast the groups as taxpayer-funded boondoggles.

The GOP spending plan would affect a range of other areas of state government as well. The plan would:

• Reduce the recurring appropriation to the N.C. Biotechnology Center by 10 percent, down to about $17.5 million per year. The reduction is in line with Democratic Gov. Bev Perdue’s proposed budget from February.

• Send a one-time appropriation of $500,000 to Johnson & Wales University, a culinary school in Charlotte that received millions in taxpayer dollars due to a personal promise from former House Speaker Jim Black.

• Eliminate funds for the Governor’s School of North Carolina, saving about $850,000 in the 2012-2013 fiscal year. The school is meant for academically gifted students; it’s been criticized for offering controversial seminars. Beginning in 2012, the State Board of Education would have discretion to make the program receipt funded.

• Reduce appropriations for the Clean Water Trust Fund by 90 percent, significantly less than the 50 percent reduction suggested by Perdue.

• Agree with Perdue’s proposal to send another $10 million to the One North Carolina fund, an economic incentives account aimed at recruiting businesses to the state.

• Eliminate around $500,000 in funding for the abortion-provider Planned Parenthood for contraception and teenage pregnancy prevention programs.

• Eliminate the State Abortion Fund, saving $50,000. The fund pays for abortions for low-income women in cases of rape, incest, or when the mother’s life is endangered.

• Reduce state funding to the N.C. Center for the Advancement of Teaching by $5.1 million. Perdue recommended a 10 percent reduction. NCCAT is currently funded at $6.1 million in state funds.

• Reduce Smart Start and More at Four funding by 20 percent. Perdue recommended a 5 percent reduction for both programs.

• Eliminate funding for the Dropout Prevention Grant program, which Perdue also suggested in her budget.

• Reduce recurring funding to the Biofuels Center by 10 percent, in line with Perdue’s recommendation.

The House Appropriations Committee approved the proposal Wednesday. The full House is expected to vote next week. The plan then goes to the Senate for consideration.

Access the full budget bill and money report here and here.

David N. Bass is an associate editor of Carolina Journal.