Research Reports: Economic Growth & Development

The original House budget proposal for fiscal year (FY) 2009-10 used $1.5 billion in Federal bailout funds to craft a budget that spent $19.3 billion. Although it is nearly $3 billion less than the original $22 billion request, the original House plan would have been just $1 billion less than actual appropriations in FY2008-09.

North Carolina’s public schools continue to add administrative, non-instructional, and instructional support positions at rates that far exceed enrollment growth. Since 2000, North Carolina’s public school student enrollment (Average Daily Membership) has increased by approximately 13 percent, while school personnel has increased by nearly 18 percent. North Carolina’s pupil/staff ratio decreased from nearly 8:1 in 2003 to just over 7:1 in 2006.

The City of Salisbury recently decided to build a $30 million fiber-optic cable system that will offer Internet, phone, and television service to Salisbury residents and businesses. The city is paying for this system with 20-year bonds.If the system cannot attract enough subscribers, city officials have stated that they will use an increase in property taxes of 9.5 cents per $100 valuation to fund the project.

The City of Wilson’s $28 million investment in a fiber-optic cable system for Internet, phone and television could be obsolete even before it is paid for, leaving city taxpayers and electric utility users to pay the balance on the 25-year bonds.

Real reform of the state’s regressive annexation law does not mean getting rid of annexation generally or even city-initiated annexation. However, it should mean getting rid of the practice of forced annexation that allows municipalities to unilaterally force individuals in unincorporated areas to live within the municipalities.

North Carolina's little-known Beach Plan imposes an enormous fiscal liability on the state. Intended largely to provide windstorm insurance for coastal residents unable to find coverage elsewhere, the Plan has grown to become one of the nation's largest entities of its type.

Although many Raleigh and Wake County taxpayers do not realize it, city and county officials knew from the beginning that the new Raleigh Convention Center would require taxpayers to pay for large operational losses and even pay large subsidies to organizations to use the facility. Even before the doors open on September 5, the losses and subsidies have begun to mount.

Energy-efficiency programs generally have many of the same problems as Duke Energy’s heavily criticized Save-A-Watt program. Energy-efficiency programs force consumers to pay an extra hidden tax on their utility bills to subsidize financial incentives for the purchase of energy-efficient goods and services.

This report on sustainable growth is the third in a series of annual research papers from the John Locke Foundation devoted to explaining the principles of free markets and applying them to current controversies in North Carolina.

Gov. Easley proposed $21.4 billion in state appropriations for continuing operations in fiscal year 2009, up $1 billion (4.9 percent) from the final budget for fiscal year 2008. Combined pay increases, including one-time bonuses, for teachers and state employees total $594 million. Less than a fifth of the $400 million in spending reductions are much more than reclaiming money that would not otherwise be spent.