The North Carolina General Assembly ended this week with no Budget deal in sight, as Governor Perdue made clear she would not sign a Budget bill containing an income tax surcharge as a way to pay for needed state services. NC House and Senate leaders, who had been building support for their compromise money package, declared they would need another budget deadline extension – the current one expires July 31 – and that extensive further work would be needed. Then they all went home for the weekend.
In addition to some kind of revenue enhancement, it appears that further spending cuts, including changes to the so-called Restoration Bill that put back some money for Medicaid PCS services, might be necessary if the Governor’s announced goals (protecting education while not raising taxes for working families) are to be achieved in the face of a $4.7 billion budget gap.
Meanwhile, the increase in the federal minimum wage to $7.25 per hour goes into effect this week, impacting all North Carolina PCS providers, and debate continues on the federal legislation to overhaul the nation’s health care system. While there are several versions of health care reform bills under discussion, all provide for employers to pay for most of the cost of employee and family health insurance coverage, or else pay a hefty surcharge.