The following editorial was published in the June 2015 print edition of Carolina Journal:

The state House’s $22.2 billion General Fund budget for 2015-16, passed just before Memorial Day, is a disappointment. There, we said it.

The spending plan is not, as some conservatives contend, a harbinger of the apocalypse. Nor does it signal a return to state government’s high-taxing, free-spending ways prior to conservatives’ legislative takeover following the 2010 election.

But it fails to advance the conservative agenda in a number of ways, and it’s encouraging to see Gov. Pat McCrory and Senate leaders react to the spending plan with skepticism, to put it mildly. Look for major changes when the Senate chamber takes up the proposal in the coming weeks.

As Dan Way and Barry Smith reported at Carolina Journal Online (see http://bit.ly/1J8Y8Me), the two-year House budget, totaling $44.6 billion, would increase spending by 6.2 percent over current levels. That’s $1.3 billion more than McCrory’s proposal, which expands spending by 2.1 percent the first year of the budget cycle and 3.2 percent the second year, less than the anticipated growth in inflation and population.

We’ve taken issue with some aspects of McCrory’s budget, but we endorse its overall focus on spending restraint and its emphasis on raising salaries for starting K-12 teachers to $35,000 (a provision that’s also in the House budget) and targeting higher pay to teachers who take on tougher class assignments and show improved performance (one that, unfortunately, the House did not include).

Moreover, the governor’s plan would replenish state reserves to prepare for the next recession and increase spending for repairs and maintenance of state infrastructure, including highways and public buildings.

The House plan would shortchange those components of responsible governance.

In addition, the House would put $120 million toward film incentives for Hollywood moguls that expired last year. An extra $70 million extended tax credits to real-estate developers, renewable energy companies, and other special interests — a deadweight loss to state taxpayers.

On the positive side, the plan would add $6.8 million to the Opportunity Scholarship Program, allowing more low-income children to attend private schools if traditional public schools aren’t meeting their needs. A $44 million extension of a tax credit for corporate research and development expenses — a misguided priority for the governor — was removed from the House plan.

But do not forget: North Carolina taxpayers, workers, and business owners have benefited from several years of conservative fiscal policy. An unexpected surge in state revenues will trigger new rate cuts in corporate taxes — from 5 percent to 4 percent in 2016 and 3 percent in 2017. The state’s aggressive repayment of a $2.5 billion federal unemployment insurance debt that began shortly after McCrory took office will return roughly $560 million from the government to North Carolinians’ pockets between now and the end of 2016.

And the plan that McCrory eventually signs is certain to be more fiscally sound than the one that came from the House.