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Education could take a hit in state budget

December 9, 2010

Education comprises about half of the state's budget, making it likely North Carolina's education system will be affected in some way by the state's projected $3.5 billion shortfall.

As education services are cut and children continue to drop out of school, the results have a lingering effect, not just on the education system, but the state's economy as a whole, according to a recent presentation from the North Carolina United Way and the North Carolina Justice Center.

Three hundred students in North Carolina drop out of school every day, according to the N.C. Justice Center. A high school graduate has a salary potential of about $27,000 a year, while a drop-out's earning potential is almost $10,000 less. Those dropouts cost the state almost $170 million a year, according to Jill Cox, United Way Government Relations and Communications director.

"Everybody has a stake in this game," Cox said. "The way our education turns out and the way our students turn out affect every single one of us."

By 2018, almost 60 percent of North Carolina jobs will require post-secondary education. Only one out of three North Carolina workers in 2008, however, had an associate degree or higher.

More workers turned to community colleges since the recession hit for post-secondary education or additional job-skill training, Cox said.
According to the N.C. Budget and Tax Center, community college enrollment increased by 20,000 students, which is the equivalent of adding another N.C. State University campus in North Carolina.

As population increased in the state, so did the number of students in North Carolina's kindergarten through 12th grade education system.

Enrollment in state schools for kindergarten through 12th grade increased by 33,000, said Alexandra Forter Sirota of the N.C. Budget and Tax Center, which adds additional pressure on the state to provide the same services for more students.

For fiscal year 2011-12, the state could face additional cuts in education, said senior policy advocate Louisa Warren with the N.C. Justice Center.

She said the state could cut funding for pre-kindergarten programs, such as More at Four, and lift the cap on charter schools.

Gov. Bev Perdue outlined education as a top priority Thursday as she proposed restructuring the state government in light of North Carolina's projected $3.5 billion budget shortfall for the next fiscal year.
"My priorities are simple: jobs for our people, investments in our children through a strong education system and setting government straight," Perdue said.

Perdue proposed a four-step plan to prepare the state for economic recovery and fiscal responsibility.

The plan includes consolidation and privatization of government departments, eliminating what Perdue called "back-office functions," freezing non-critical positions in cabinet agencies and reviewing of state boards and commissions.

"State government must seize this opportunity to become a more streamlined, focused enterprise," Perdue said. "We must be leaner, more nimble, more responsive to citizens and less bureaucratic as we focus our limited resources on our core mission."

Perdue's plan includes the consolidation of the state Department of Commerce and the Employment Security Commission, which she said strengthens the agencies' commitment to providing jobs for state residents.

Perdue also created the new Department of Management and Administration. The new department, formerly the Department of Administration, will be the chief operations unit for state government and includes state ITS, the Office of State Personnel and the Controller's Office.

These consolidations, Perdue said, will save millions of dollars.

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