News: CJ Exclusives

Top House budget writer talks spending, education, transportation

Senior Appropriations Committee Chairman Nelson Dollar discusses budget differences between House and Senate in exclusive interview with CJ

Rep. Nelson Dollar, R-Wake, at the June 1 news conference introducing the House budget. (CJ photo by Kari Travis)
Rep. Nelson Dollar, R-Wake, at the June 1 news conference introducing the House budget. (CJ photo by Kari Travis)

RALEIGH — Now that all budget proposals are on the table, the negotiations between North Carolina’s House and Senate leaders will get serious.

Rep. Nelson Dollar, R-Wake, senior chairman of the House Appropriations Committee, sat down with Carolina Journal Thursday morning before the news conference introducing the House budget to discuss successes, priorities, and differences of opinion.

Dollar talked taxes, infrastructure, state employee pay raises, education, and answered questions about ongoing tensions between the General Assembly and the State Board of Education.

The interview has been edited for clarity.

Q: What makes you most proud in this budget? What is not in it that you regret the most?

A: I’m proud that we have a budget that is balanced, that is very responsible. [We have a budget] that we believe moves the state forward, that addresses and continues on our commitment to raise average teacher pay, that provides raises in both years for hard working state employees, and that eliminates the waiting list for … early childhood education — which is a tremendous investment. We are very pleased with this budget, that we have a balanced approach to continuing tax reform, putting that money back in the hands of working families and giving job creating businesses some tax relief — continuing down that path which we believe is quite important.

We believe that infrastructure is important. We continue to see a substantial increase in our transportation budget, and we have augmented that budget in order to provide funding to help modernize our … commercial airports where the federal government is no longer participating the way that it used to. That’s a key component to continuing to build North Carolina as a global player in the economy, and being able to draw in key investments to continue to … have the types of jobs and the type of economy we want to have in this state.

Certainly, it would be my preference to do more for our state employees. I’d like to do that, and certainly we want to continue to look at issues like mental health and provide the resources we need there to address those issues. Those are … a couple of areas we want to continue working on as we prepare for future budgets.

Q: How do you think you might reconcile the big spending differences between the Senate and House in Year Two? [The House plan would spend roughly $300 million more than the Senate’s in the fiscal year starting July 1, 2018. Gov. Roy Cooper’s General Fund budget would spend roughly $1.7 billion more than the House and $2 billion more than the Senate over the two-year budget cycle.]

A: We’ll certainly work with our Senate colleagues. That’s just part of the negotiation process.

I think what you’ve seen in the House budget is a budget that we believe strikes the appropriate balance between tax reduction and making sure that we have the resources to make the kinds of investments we [need] in the state. The governor provided no tax relief [in his proposed budget]. The Senate, of course, put forward a very ambitious package. We [in the House] believe that we’ve struck a balance between certainly not spending what the governor spent, and maybe not going with the same ambitious [tax] package as the Senate did. We believe we struck an appropriate balance between making sure we are funding our needs, and, at the same time, continuing to provide [the] tax relief and tax reform that we have been working on … all six years that Republicans have been in charge.

Q: The House state employee pay raise is higher than both the Senate’s and the governor’s proposals. How did you decide on the number, and do you think the Senate will buy into the proposal?

A: I certainly can’t speak for the other chamber. … We both work on our budgets, and then we come together and we’ll have to negotiate the differences. One of the things that we have done on the House side is to not fund the salary line items [for unfilled state positions]. Few large businesses and enterprises do that, and it’s our understanding that many states do not. … So, what we have done this year [has], in a very modest way, provided us with additional salary funds that we put into those raises, [making sure that] those go directly to our state employees.

Q: Is it possible to continue giving state employees raises and retirees cost-of-living increases given the recent Superior Court ruling requiring the state to repay State Health Plan premiums to retirees? (The ruling will cost at least $100 million and maybe much more.)

A: You have to invest in your employees. And you have to be able to be competitive in order to have folks that are drawn to those jobs. Without a high quality work force, you’re not going to have the services that the citizens of this state expect from state government. They expect state government to be able to be responsive, and to do a good job with all of the range of services that we’re providing. In order to do that, you have to have top-flight people, quality people, running that system if you want government to be efficient. Therefore, you have to make sure that you are paying folks enough to draw those quality people into the work force, and to be able to maintain those dedicated, quality people we have working for the state.

Q: Understandably, but do you anticipate having to make cuts in other areas to compensate for that spending increase to repay those State Health Plan premiums to retirees?

A: Well, the issue there is an issue that is coming through the trial courts. … The view of a particular judge is not necessarily the view that will be taken by the Court of Appeals or the Supreme Court. … I think we have to wait and see what the order actually is. … Certainly, whatever that order is, it is not in line with the state’s interest, and I’m sure that we will be appealing that, and it will go through the process. And we will see where we are once the courts have actually spoken on that issue in full, and not necessarily [speculate] on what one judge may, or may not, do.

Q: The House and Senate handled funding cuts to the Department of Public Instruction very differently. Instead of calling for a 25 percent cut, as the Senate did, the House allocated $1 million for an audit of the department. The House budget also abandoned the Senate’s proposed cuts to State Board of Education staff, and nearly doubled the amount allocated for Superintendent Mark Johnson’s staff. Why was your approach so much different than the Senate’s? How much input did DPI and the state board have into the process?

A: The input was from our education [committee] chairs in that area. Their committee members believed that approach was the appropriate [one]. Certainly, in negotiation those two differing approaches will be there for … the Senate to now negotiate.

Q: Given current tensions between the state board and the General Assembly, do you see this budget as a kind of peacemaking opportunity moving forward?

A: At the end of the day, we know that we need the Department of Public Instruction and the state board — and the leadership of both those organizations, the superintendent of public instruction, to be able to work together for the benefit of our children.

We have confidence [that eventually the differences of opinion] that actually go back decades about the governance of our educational system, will be at least — if not agreed upon — resolved sufficiently to make sure that we are moving ahead with the state’s education system. … Whether it is the board, or whether it is the superintendent, or whether it is their various staffs and agencies, I believe there is a shared goal of improving performance in the classroom.

This General Assembly has worked very diligently on trying to put in place policies that we believe will improve student performance in the classroom. And I think, again, that’s a shared goal [between] the Senate and the House. … And together, we believe we’ve been making a difference in student performance, and we believe that all of us, whatever our views about some of the governing structures, will keep in the forefront of our minds that it’s about the students in the classroom, and how they’re performing.

I believe that is where we’re headed, and the track that we’re on. And I think you’re going to see improvement in classroom performance among our students. That’s what’s most important.

Q: Last year, the NC Promise $1,000/year tuition plan was a major marketing push for both in-state and out-of-state students who wished to attend UNC Pembroke, Western Carolina University, or Elizabeth City State University. This year, you’ve proposed cutting that tuition break for out-of-state students. Why did you make the change? How do you answer the Senate’s concerns regarding the cut?

A: Again, it’s an issue that needs to be negotiated. It’s affected the three institutions involved in different ways. I think that we have to look at those individual institutions. There certainly was a greater cost to the program than was initially anticipated — a factor of some 25 percent. So, I think with any major initiative that you launch … you learn things. … I think that we’ll be [talking to the Senate] about what we’ve learned in the last year, about implementation of the program, and about what adjustments may be appropriate.