Dear Friend of Senate District 10,
 

This morning the Senate officially passed the 2021 Appropriations Act also known as "The Budget". The FY 2021-22 proposed budget of $25.7 billion represents a 3.4% increase over the comparable enacted FY 2020-21 budget (excludes debt service, adjusts for recurring items funded with NR receipts, and CRF Offset in FY 2020-21). The FY 2022-23 proposed budget of $26.6 billion represents a 3.7% increase over the proposed FY 2021-22 budget.

Selected Statewide Highlights include:

• Transfers an additional $3 Billion into the Savings Reserve Account, which when combined with the existing cash balance and the anticipated transfer at the end of FY 2020-21, will bring the total anticipated balance to $5 billion in 2023;
• Provides Compensation increases of 1.5% for most State employees totaling $198 million in FY 2021-22 and $355 million in FY 2022-23. This includes $32.1 million to implement an experience-based salary schedule for Correctional Officers in Adult Correction and $31.2 million to provide a $13/hour minimum wage to employees in local public schools and community colleges.
• Also, provides bonuses of $1,000 for state employees and an additional $500 bonus for certain state employees totaling $545 million from federal State Fiscal Recovery Funds.
• Fully funds State Health Plan requirements and Retirement System requirements over the biennium and provides up to $215 million in federal COVID-19 funding to reimburse the State Health Plan for COVID-19 expenses;
• Reduces the personal income tax rate from 5.25% to 3.99% over 5 years and makes various changes to deductions to further reduce taxes on individuals.
• Simplifies and reduces the franchise tax base for corporations that have significant real and personal property investments in the State and phases out the corporate income tax over 5 years, beginning in 2024.
• Provides $900 million for repairs and renovations for State agencies and the UNC System;
• Authorizes $481 million in capital projects for State agencies, $588 million in capital projects for the UNC System and $400 million in capital for Community Colleges.
• Provides $600 million in new federal funding to the State’s GREAT broadband initiative. Provides $90 million in new federal funding to issue targeted grants addressing local infrastructure needs and to connect underserved households
• Budgets $4.9 Billion in federal State Fiscal Recovery Funds in FY 2021-22 and an additional $300 million in FY 2022-23. Also, budgets $1.4 Billion in other federal grant funding from the American Rescue Plan Act in FY 2021-22.

For more information on the budget and its details, I encourage you to listen to the video at this link: https://www.wral.com/nc-senate-rolls-out-spending-plan/19736563/

Additionally, the NC Farm Act passed the House Rules Committee and was also passed on the House floor. The bill is now set to be discussed and finalized in Conference, where it will then be sent back to both the House and the Senate for concurrence.

As always, please do not hesitate to contact me if I can assist you in any way possible.