Tax cuts for richest 20% or fund the things North Carolinians need?

Across North Carolina, no matter what we look like or where we live, most of us believe in caring for our families and leaving things better for those to come. We want to live in communities where everyone has the opportunity to thrive. But a handful of North Carolina politicians have rigged the rules to redirect resources from our communities to the pockets of the richest few in our state – and some are trying to pass a state budget that doubles down on tax cuts for the wealthy.

Once again, our state is set to finish out the fiscal year without approving a budget, as Conference Committee continue to negotiate behind closed doors. North Carolinians deserve a budget without any of the harmful tax cuts in the Senate version of budget passed in May. The Senate’s tax plan proposes reducing the personal income tax rate from the current rate of 4.75 percent to 2.49 percent after 2029, deepening already scheduled cuts. The benefits of these tax breaks will go overwhelmingly to the richest 20 percent of North Carolinians. The personal income tax cuts alone will reduce public funds by $7.6 billion annually when in full effect. This is more than the entire annual state appropriation for Health and Human Services proposed in the Senate budget, which is $6.6 billion. This is also more than the $7 billion our state needs in 2030 to ensure every child can get a sound basic education by providing teachers with meaningful salary increases and fully funding the annual investments in public education detailed in the Leandro Plan.

Instead of tax cuts that benefit the wealthy and profitable corporations, we could fund what is most important to our state’s communities and families. We could fund all the programs and services listed below and still not reach $7.6 billion. This list is not necessarily how the state should spend this money – a true accounting of budget priorities would come from first assessing our state’s needs – but this list illustrates how we could use our money to create a better future for all North Carolinians.

In North Carolina, we could spend:

• $151 million to support healthy pregnancies and child development for 10 times the number of low-income first-time moms and their babies through the Nurse-Family Partnership program.¹Based on estimate costs of $8,600 per family in Mecklenburg County’s program. Currently 1,950 families receive services statewide, $151 million could expand the program to a total of 19,500 families.
• $300 million to keep child-care providers open by boosting pay for early childhood educators and supporting new child-care centers.²Governor Cooper’s recommended budget includes $300 million in FY 2023-2024 for child care stabilization grants for compensation and start up support after federal funding runs out.
• $267 million to guarantee every school has licensed staff to support student mental & physical health.³Governor Cooper’s recommended budget include $267 million recurring in FY 2023-2025 for Instructional Support Personnel to fund a school nurse and/or psychologist in every school building.
• $200 million to provide free breakfast and lunch to every public school student.⁴HB 550: Free Breakfast & Lunch in Public School Units (2020-2021.)
• $4.2 billion to halve the number of children living in poverty with generous child tax credit.⁵ Institute on Taxation and Economic Policy. Based on a North Carolina Child Tax Credit of $3,100 for kids 18 and under and $3,720 for kids under 6.
• $26 million to protect North Carolina’s environmental resources by adding key staffing and technology to the Department of Environmental Quality.⁶Governor Cooper’s recommended budget includes $26 million recurring to the Department of Environmental Quality in FY 2024-2025 to support 72 additional staff and provide key technology for the department.
• $13 million to cover the costs of two weeks of early voting for every registered voter in the state.⁷Brennan Center for Justice estimates that two weeks of early voting cost $1.77 per voter. Estimate shows the cost of two weeks or early voting for North Carolina’s 7,276,039 registered voters.
• $93 million to expand and preserve affordable housing for 10,000 low-income households.⁸Every $1 million spent by the NC Housing Trust Fund assists 108 households according to the NC Housing Coalition.
• $775 million to end hunger in North Carolina.⁹Feeding America: Hunger in North Carolina.

Any one item on this list would improve the lives of North Carolinians with low- and moderate-incomes and make our state stronger and better for everyone.

Food and shelter are two of our most basic needs as human beings. North Carolina has a shortage of affordable housing units, with only 43 available rentals for every 100 extremely-low-income renter households. With just 1 percent of the value of these tax cuts, we could provide affordable housing for thousands of low-income individuals and families, including seniors, veterans, people with disabilities, and people currently experiencing homelessness. In North Carolina, 1 in 8 people face hunger – including 1 in 6 children. With just over 10 percent of the value of these tax cuts, we could end hunger for 1.3 million North Carolinians.

It’s time to demand our leaders make sure the wealthiest households pay what they owe through taxes. That’s how we show up for each other, delivering the quality schools, clean drinking water, and safe and affordable housing that ensure all our families can thrive

Footnotes

• 1
  Based on estimate costs of $8,600 per family in Mecklenburg County’s program. Currently 1,950 families receive services statewide, $151 million could expand the program to a total of 19,500 families.
• 2
  Governor Cooper’s recommended budget includes $300 million in FY 2023-2024 for child care stabilization grants for compensation and start up support after federal funding runs out.
• 3
  Governor Cooper’s recommended budget include $267 million recurring in FY 2023-2025 for Instructional Support Personnel to fund a school nurse and/or psychologist in every school building.
• 4
  HB 550: Free Breakfast & Lunch in Public School Units (2020-2021.)
• 5
  Institute on Taxation and Economic Policy. Based on a North Carolina Child Tax Credit of $3,100 for kids 18 and under and $3,720 for kids under 6.
• 6
  Governor Cooper’s recommended budget includes $26 million recurring to the Department of Environmental Quality in FY 2024-2025 to support 72 additional staff and provide key technology for the department.
• 7
  Brennan Center for Justice estimates that two weeks of early voting cost $1.77 per voter. Estimate shows the cost of two weeks or early voting for North Carolina’s 7,276,039 registered voters.
• 8
  Every $1 million spent by the NC Housing Trust Fund assists 108 households according to the NC Housing Coalition.
• 9
  Feeding America: Hunger in North Carolina.