With negotiations over the state budget stalled, Republican legislative leaders put forward a plan Wednesday to dispose of much of the $900 million budget surplus: Give the money back to North Carolina taxpayers.
"Tax revenues don't belong to the government," Senate President Pro Tem Phil Berger said during an afternoon news conference announcing the Taxpayer Refund Act. "Tax revenues belong to the people who earned the money to begin with, the people we collected it from in the first place. We're returning their money to them to spend or save as they see fit."
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The proposal, which will be introduced in the Senate Finance committee on Thursday, will refund up to $125 for each individual filer and up to $250 for couples filing jointly.
Legislative officials said they expect the state to be cutting about refund checks for 5.1 million taxpayers under the plan. The proposal includes $5.5 million to cover the costs of processing and mailing checks.
People who paid their 2018 taxes by August of this year would get their checks by Dec. 15. Those who filed later would get them by next February.
The refund checks would total about $680 million of the surplus, and GOP leaders said they could issue them without jeopardizing the $24 billion state budget, which has been hung up for almost two months amid a dispute over Medicaid expansion.
After Gov. Roy Cooper vetoed the budget, he pushed for negotiations over a final spending plan to include expanding taxpayer-funded health coverage to hundreds of thousands of low-income working adults. But Republican legislative leaders want no part of Medicaid expansion, saying the cost could wind up to be exorbitant in the future.
House Speaker Tim Moore has been unsuccessful so far in trying to wrangle enough Democrats over to his side to override Cooper's budget veto, and there has been little, if any, negotiation between Cooper's administration and GOP leaders on a compromise spending plan.
Instead, both sides have resorted to issuing almost daily news releases blaming the other side for the stalemate and arranging photo ops where they can tout the benefits of their own proposals.
"Negotiating a new budget remains impossible as long as he maintains that ultimatum," Berger said of Cooper's push for Medicaid expansion.
So, lawmakers have begun an effort to work around the veto and pass portions of the budget that they believe Cooper can support.
A bill cleared the Senate Appropriations committee on Wednesday that would give corrections officers 2.5 percent pay raises in each of the next two years, as well as five days of special annual leave. Corrections officers serving in prisons where jobs are hard to fill also would get a bonus of at least $2,500.
Bills to give other state employees and teachers as yet unannounced raises will start moving in the House next week, Moore said.
"There were key things in that budget that we feel like need to move on," he said. "There would really be no basis ... that the governor could argue to try to then veto these pay raises as standalone bills because of the pursuit of Medicaid for all. The two are completely not connected."
The Senate Health Care committee also passed a measure Wednesday that includes funding to continue shifting the Medicaid program into a managed care structure.
Cooper spokesman Ford Porter said the budget surplus would be better spent on North Carolina schools.
"The Governor will review any final legislation, but given the way this legislature has shortchanged public education, this money is badly needed in our public schools," Porter said in an email to WRAL News.