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The Daily Tar Heel

Legislators: Poor Fiscal Predictions Not Anticipated

State officials announced last week that they expect the state's economy to grow by 2 percent at the most during the remainder of the fiscal year. The budget was based on a 4 percent growth rate.

Rep. Warren Oldham, D-Forsyth, co-chairman of the House Appropriations Committee, said it was not state legislators' fault for passing a budget that needed adjustment after only three weeks. "When the budget was made, it was predicated on revenue growth of 4 percent," Oldham said. "The incidents of a month ago caused the economy to slow down, and in order to prepare for the future (Gov. Mike) Easley was forced to (look for budget cuts)."

Oldham did not explain why the General Assembly did not make any adjustments for the economic slowdown resulting from the attacks, even though the budget was passed more than a week after Sept. 11.

Some officials have said the UNC system's budget could be cut by as much as 4 percent, about $72 million, as a result of the new growth forecasts.

But Easley stated in a Friday press release that he was not proposing to cut 4 percent of the UNC system's funding. Instead the press release stated that the governor's office plans to work with system officials to generate savings in the coming months.

Easley also has frozen the state's construction budget, including about $57 million for repair and renovation projects in the UNC system.

Senate Minority Leader Patrick Ballantine, R-Carteret, said the cuts contradicted the governor's commitment to education but did not say what actions the General Assembly could have taken three weeks ago to adjust the budget. "The (budget) cut is unsophisticated and unnecessary," Ballantine said. "It's a rudimentary way to make a budget. We should find out the priorities and pay for them. If education is a priority, pay for education."

Fred Hartman, Easley's press secretary, further explained the governor's goals. "We haven't set a specific target," Hartman said. "We want to work with the university to try to find areas of savings that don't affect the classroom."

Oldham said there were not many other options left to the governor and that savings would have to be found by cutting budget allocations. "(The options available) in the budget making process were to cut further or raise taxes," he said. "We have to cut further, because we already raised taxes."

But Ballantine said more adjustments are needed.

"(Easley) needs to go back to the drawing board and prioritize what is important in state government."

The State & National Editor can be reached at stntdesk@unc.edu.

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