No Luck With Lottery Loot
Local officials are still reviewing the state budget to determine what the impact of those state-level reductions will mean to local agencies and, by extension, Mecklenburg County’s total budget. Concrete answers, officials said, likely won’t be available for another six to eight weeks.
“The only thing for certain right now,” said Commissioners Chairman Jennifer Roberts, a Democrat, “is that there is a lot of uncertainty.”
Commissioners said the county should begin planning immediately to deal with a worst-case scenario, which would include filling a $4.1 million budget gap produced by the state’s lottery-grab. The bulk of that impact is likely to be felt by CMS, which only a few weeks ago saw commissioners add $6 million to the district’s operating budget. CMS had planned on using that money to rehire teachers who were laid off because of funding reductions.
Not so fast, commissioners said Tuesday night.
“I don’t want CMS and Dr. Gorman to hire back a bunch of teachers that we may have to force them to layoff in six to eight weeks, depending on what happens with the state,” James said. “It’s important for Dr. Gorman and these other groups to understand that there’s an asterisk next to the amount that we provided to them two weeks ago [in the county’s recently approved budget].”
Commissioner Dumont Clarke, a Democrat, agreed. He called for the Board of Education, in approving CMS’ budget, which typically isn’t finalized until weeks after the state approves its own budget, to include a contingency fund of up to $4 million to offset the potential local impact of the state’s lottery-grab.
County Manager Harry Jones assured commissioners that he has been in contact with Gorman and that the superintendent understands there is a chance state actions could mean a reduced allocation for CMS.
“If we are limited to the $4 million from the lottery as our maximum exposure, I will say to you that I believe that we can find a way to manage it, because we have a contingency amount there,” Jones said. “What we don’t know right now is what additional burdens might be place on us by the state.”
Indeed, the biggest potential threat remains any impacts from Medicaid funding the state receives from the federal government. As part of last year’s stimulus package, the feds agreed to take on a greater share of states’ expenditures on Medicaid.
Congress originally planned to extend the largess for an additional six months, but that now appears unlikely. If an extension is not provided, states will again be responsible for funding a higher portion of Medicaid. The impact on North Carolina would blast a whopping $519 million hole in the state budget.
The General Assembly has crafted some contingency plans if that happens, including a 1-percent, across-the-board cut to all state agencies. That would equal a statewide cut of about $177 million, effective January 1, if Congress opts to not extend its Medicaid stimulus. It’s uncertain where those cuts would be made and how they would effect county programs and services that partner with the state; but it likely means significant further reductions at the county level.
“There’s a high likelihood that when the state departments make cuts, parts of those cuts would be in allocations made to county governments and that would create holes in our budget,” said Brian Francis, assistant to the county manager and Mecklenburg’s legislative liaison.
The even bigger concern is that Mecklenburg could suffer disproportionately deeper cuts than other counties across the state, as was the case with the legislative lottery-grab.
Clarke said it would be devastating if Congress doesn’t extend its Medicaid largess.
“We have a very weak recovery underway and what it really calls for is to continue some government deficit spending,” Clarke said. “There’s just no question about it.”
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