Research Reports: 2006

Budget proposals from Gov. Mike Easley and the Senate put state spending back on the path of rapid growth last seen in the late 1990s. After inflation, the state will spend 10 percent more per resident on operations in the FY2006-07 than it did just three years ago. Real spending per resident is up 23 percent in the last decade. If the General Assembly had restricted spending growth to inflation and population growth over the decade, the General Fund operations budget would be $3.4 billion less than proposed.

State government needs pay its employees differently if it wants to keep the best of them. The average state employee earns as much as the average employee nationally, but across-the-board pay raises fail to reward employees for performance. Employees who choose to work for the state are more risk averse and may stay despite a lack of productivity. But these employees merely substitute unseen political risk for visible market risk. The General Assembly should consider more pay for performance and portable benefits for state employees.

Since the late 1980s, housing prices in North Carolina have increased rapidly in some cities while in others prices have grown more slowly. Asheville and Wilmington, for example, are known for large increases in their housing prices over the last 15 years, while in Fayetteville and Hickory housing prices have grown much more slowly. Why is this?

Current law does not protect North Carolinians from eminent domain abuse. The state and local governments can seize private property for economic development reasons. However, the potential for eminent domain abuse is far more extensive than these “economic development takings.” From the state’s dangerous urban redevelopment law to the government finding clever ways to seize property for private businesses, North Carolina needs comprehensive protection from eminent domain abuse.

Gov. Mike Easley’s proposed $18.9 billion budget does not provide enough relief to taxpayers who made it possible. The governor could have returned the $1.1 billion in overcollections to taxpayers without jeopardizing future fiscal health. This would include ending the half-cent sales tax and 8.25 percent income tax rate set to expire in 2007, and providing a temporary quarter-cent sales tax refund. Removing the county burden for Medicaid would also ease the fiscal pressure local governments face to raise taxes to pay for schools and roads.

North Carolina’s largest public transit systems are often credited with reduced traffic congestion and air pollution, efficient land use, reduced dependence on oil, and much-needed mobility for some residents. Are they fulfilling these missions? How are they performing? Who do they benefit? What do they cost?

Air pollutants of all kinds in North Carolina and the United States are at their lowest levels since measurements began back in the 1970s. The weight of the evidence suggests that these low levels of air pollution are at worst a minor health concern.

North Carolina’s experience with taxpayer-funded judicial campaigns provides a great example of the critical problems with taxpayer-funded campaigns.

In spite of our state's record of commitment to education, there continues to be a significant debate as to the most effective means of providing our children the best possible education. The one point upon which a great majority agree is that, despite substantial increases in funding, public education is not meeting the needs of students. This report presents parental school choice as a promising alternative to the educational status quo. And it will show that it is consistent with NC's historical commitment to education.

Neither enrollment increases nor federal and state mandates can account for the 19 percent increase in school personnel over the last eight years. The glut of public school personnel hiring is evident in counties that have a declining student population. Despite losing nearly 10,000 students in eight years, these school districts added 819 employees. This shows that school districts actively maintain their bureaucracy even as the amount of work declines.