The Proposed Budget Would Require N.C. to Come Up with Billions More in Revenue
Billions of dollars in extra revenue will have to be found if North Carolina wants to maintain its anti-poverty programs should the proposed federal budget pass Congress, a new study finds.
“Given the massive cuts to federal funding proposed by the President, North Carolina would have to come up with at least $13 billion in additional revenue over the next 10 years to maintain existing vital programs,” claimed a recent report from the nonpartisan, nonprofit North Carolina Justice Center.
The N.C. Budget and Tax Center, an arm of the N.C. Justice Center, said “… that the N.C. Senate and House budget proposals do not currently plan for what happens if North Carolina has to assume these costs.”
The bill has yet to pass Congress, and likely won’t without going through some significant changes first. Criticism has been levied against the budget from both sides of the aisle and across multiple demographics.
For instance, programs that benefit Native Americans would see a substantial reduction, as well as other programs associated with farmers across the country. The hit to states and their ability to maintain anti-poverty programs are now also coming to light.
Federal funds currently account for $0.327 of each state dollar towards these programs. The reduction in aid from the federal government would then precipitate N.C. needing to find billions of dollars extra in revenue over the next decade in order to maintain its programs, or otherwise face massive cuts to its anti-poverty projects.
A big cut proposed in the budget bill would be the reduction of Supplemental Nutrition Assistance Program (SNAP)—otherwise known as food stamps—and the aid that the government provides the states. In the current proposal, states would have to cover 25% of SNAP costs by 2023.
It is precisely these types of reductions that would increase the burden on states and force them to find extra revenue in order to compensate for the withdrawal of federal aid.
“Such a cost shift to states will ultimately mean that North Carolina, and most Southern states, will be left behind and residents will be left out of the benefits of a thriving economy,” the report stated.
The report goes on to malign the budget and claim that it will leave behind many southern states and poverty-stricken residents, instead focusing on giving tax breaks to the wealthy. The bill faces an uphill battle at the moment as it suffers criticism from all sides, but with both houses under control of the Republicans, it’s quite possible that the budget could pass through with relatively few changes.
“U.S. cuts could hurt N.C. for next decade, study says,” The Chronicle, June 15, 2017.