MEDIA RELEASE: State investments in public services at 40-year low, despite increased demand

Recent state budget passed fails to keep up with demand for health care, early childhood, and higher education

RALEIGH (Dec. 15) ­– State investments in core services such as education, health, and public safety are projected to reach a 40-year low over the next two years, a new report finds.

After decades of stability, state funding for core services – as a share of North Carolinians’ incomes – has fallen drastically, according to a report released this morning by the North Carolina Budget & Tax Center, a project of the NC Justice Center.

“What distinguished North Carolina from its southern neighbors over the past half-century has been a robust and consistent commitment to public investments in education, health, and safe communities,” said Edwin McLenaghan, public policy analyst with the BTC and author of the report. “The new state budget represents a major departure from recent historical precedent by pushing state funding to historical lows.”

The reduced commitment to public investments in the recent state budget has already produced troubling results, the report said. There are fewer teachers in the classroom, longer waiting lists for child-care subsidies, and higher tuition and fewer classes for college students. In addition, vital health-care services for elderly, disabled and indigent North Carolinians are at risk of being eliminated.

The report also found that the demand for state-funded services like education, health, and corrections has outpaced the state’s population growth and increased pressure on sustaining these core public investments. Even if per capita state funding had remained constant instead of declining in recent years, funding would still fall short of the level necessary to sustain the quality and availability of key public services.

That pressure will only increase in the coming decade, the report said, as North Carolina’s elderly population will grow faster than the state’s under-65 population. At the same time more elderly residents become reliant on state-funded services, an even smaller share of the state’s population will be working and paying income tax.

Even as core services face substantial and growing pressure from an aging population and rising health-care costs, the state cannot afford to abandon pro-growth investments to improve educational attainment and workforce development. State policymakers will need to strengthen North Carolina’s commitment to education investments in order to increase the number of residents completing post-secondary degrees or credentials to meet the skill demands of new jobs.

“For the state to thrive economically and meet its commitments to seniors and other vulnerable populations, policymakers will need to reverse course and strengthen the state’s financial commitment to vital public services and investments,” McLenaghan said.

FOR MORE INFORMATION CONTACT: Edwin McLenaghan, Public Policy Analyst, NC Budget & Tax Center, 919.856.3192, Edwin@ncjustice.org; Julia Hawes, Communications Specialist, NC Justice Center, 919.863.2406, Julia@ncjustice.org.

The N.C. Budget and Tax Center—a project of the N.C. Justice Center—seeks to create economic opportunity and shared prosperity for all North Carolinians through non-partisan research, education and advocacy on budget, tax and economic issues.