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North Carolina governor's budget veto overturned

By Ned Barnett

RALEIGH, North Carolina (Reuters) - North Carolina's Republican-led Senate overrode Democratic Governor Beverly Perdue's veto of the state budget on Wednesday, making the two-year spending plan law.

The 31-19 vote ended a bitter debate between Democrats and Republicans about how deeply to cut spending in light of high unemployment and the slow pace of recovery from the last recession.

In an earlier post-midnight session on Wednesday, House Republicans also voted to override the governor's veto with the help of five conservative Democrats who supported the budget originally.

The $19.7 billion budget for the coming year takes effect on July 1.

Republicans control both chambers of the state Legislature for the first time in more than a century, and the budget bill fulfills campaign promises not to raise taxes and to let a temporary one-cent sales tax and some income taxes on high earners expire.

It also makes cuts and changes in state spending to close a $2.5 billion budget shortfall.

"This is a responsible budget in a difficult year," said House Majority Leader Paul Stam.

Perdue on Sunday became the first North Carolina governor to veto a budget since the state's top elected official obtained veto power in 1997.

She argued the one-cent temporary sales tax should have been extended another year to fund education. She and other Democrats objected to the General Assembly budget cutting a further $124 million in funding for local education on top of $305 million cut in previous years.

They said the extra cut would cost thousands of teachers and teacher aides their jobs and worsen the state's unemployment rate, which at 9.7 percent is above the national average.

"Tonight, the Republican-controlled legislature turned its back on North Carolina's long-standing commitment to our people to provide quality schools, community colleges and universities -- all to save a penny," Perdue said in a statement after the House override of her veto.

Republican leaders in the General Assembly said Democrats exaggerated the budget cuts' impact on public schools. Stam said the difference between the governor's proposed budget for education and what became law on Wednesday was only a half of 1 percent.

Stam is correct in terms of funding for K-12 education. But the governor emphasizes a bigger gap in overall education spending during the two-year term of the budget.

When comparing funding of K-12, community colleges and the state university system, the General Assembly's plan will spend $561 million less than the governor proposed.

Overall spending on education during the next two years will be about $22 billion.

Perdue spokeswoman Chrissy Pearson said Republicans were "choosing one little piece of the picture that looks best for them."

Stam told Reuters the governor's version of the education budget cuts was "just wrong on the math. She's not wrong often, but she's wrong on that."

(Editing by Colleen Jenkins and Jerry Norton)

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