Legislators approve state budget — Ouch!

They're about six weeks late, but North Carolina's legislators are finally getting around to doing the most important thing we hire them to do: Pass a state budget. Don't expect a lot of rejoicing throughout the land, however. This budget will hurt everyone in the state, some more so than others.

The budget, which awaits final votes in the House and Senate, will raise sales taxes by a penny. This tax is paid by everyone, which makes some nominally egalitarian types happy, but, in reality, the sales tax is the most regressive of taxes, falling heaviest, proportionally, on those with the least income. Perhaps to correct that flaw in the state's new revenue stream, the budget also imposes an income tax surcharge on "high income" taxpayers. The surcharge starts at $100,000 in taxable income, which, while well above the state's mean household income, is not exactly "rich." A lot of two-income couples who consider themselves working class will have to pay an extra 2 percent surcharge on this year's income.

The public will feel the budget's bite in other ways, too. Legislators are cutting public school appropriations and leaving it up to individual school districts how to allocate those cuts. My bet is that the cuts will more often be sliced out of teaching positions and classroom supplies than out of central office administration. This recession has prompted a lot off workers and executives to absorb pay cuts. I doubt that any school superintendents, assistant superintendents, principals or directors of arithmetic will see their pay cut.

Also feeling the brunt of the budget cleaver will be some of the state's most helpless people. The budget cuts back on community support for the mentally ill and developmentally disabled. Community assistance workers make it possible for many handicapped people to live useful, near-normal lives. Taking away that assistance could well create problems that end up costing the state more money in the long run.

Although legislators did trim spending a bit — the budget passed on party-line votes, so the budget is purely a Democratic document — they left untouched what seems to me to be simple, painless cuts, the low-lying fruit of budget talks. For example, this weekend is tax-free weekend. Highly touted by retailers, this back-to-school weekend is more popular than its actual value to consumers, who get a discount of a whopping 6.75 percent on purchases that fit the state's criteria. But the sales tax moratorium costs the state about $12 million in forgone revenue. That's not enough to balance the budget, but it's a start.

I'm also amazed that I've heard nothing about the millions of dollars legislators decided to borrow last year for construction projects on university campuses around the state. This borrowing, which did not involve a taxpayer referendum, comes on top of $3 billion in university spending that taxpayers had approved a few years ago for projects that are still under construction. The state could save millions — and perhaps take a moment to rethink some of this profligate spending — by halting projects such as the ECU dental school and the expansion of the dental school at UNC-Chapel Hill. Those are lost opportunities to save real money without hurting anyone.

The biggest question remaining from this budget is whether voters will pay any attention. Democrats seem confident that the spending cuts and tax hikes will not come back to haunt them. Republicans hope taxpayers will remember who was in charge when their taxes were raised and teachers were laid off.