Supplanting or not
My story today dips into the renewed buzz surrounding the supplanting debate over the lottery.
The bullet is this: Easley's folks want to pull some tax money out of a couple education programs and use it elsewhere in next year's education budget. They will replace the money they move out of pre-K and class size reduction efforts with lottery proceeds.
They argue: that as long as the education budget increases over all, the lottery funds are not supplanting.
Supplanting is a term lottery opponents have used to describe what happens when additional money generated by the lottery displaces tax dollars rather than boost spending for education.
Critics argue: that what Easley is doing is the very definition of supplanting.
Some remainders that didn't make the story:
From Paul Luebke, a Durham Democrat and UNCG prof.: Luebke voted against the lottery but is now in the curious position of being a finance chairman in the House where he'll have a say on how the lottery money is processed through the budget.
Luebke takes the strictest possible view on supplanting, saying that lottery dollars should not push tax dollars out of any program they're going to now.
He predicts that more folks in the House might share this view, where the lottery passed by just one vote. The folks in the other chamber, he speculated, might be more flexible.
"My impression is that the Senate is more comfortable with supplanting," Luebke said.
If the House and Senate can't agree on what exactly constitutes supplanting or whether they'll do it or not, it could make for a long short session beginning in May.
Speaking of the Senate...
Sen. Kay Hagan, a Greensboro Democrat, was getting ready to throw a big dinner party when I talked to her yesterday. Her quotes on the topic:
"It is my strong feeling that any lottery money should be new, additional money for education," Hagan said. "I think it needs to be new money, laid out in accordance with the language that's in the lottery bill."
So how does she feel about the supplanting issue? Yeah, I'm not sure either. Looking at my notes, she's left herself a lot of wiggle room.
My sense is she'll make sure the lottery money stays in education but may be more flexible than Luebke.
Fellow Senator Phil Berger...
...expects there to be supplanting. He's a lottery opponent who is a glass-half-empty kind of guy on all things lottery, including how the money will be spent.
"I think this is what folks were saying all along would be the net result," Berger said. "It's just additional money for the government that will free up money that's currently going to education for other things."
Berger points out that the original version of the Senate budget would have used lottery money to replace construction money that already goes to school districts. Currently, part of the money raised by the corporate income tax goes to counties.
The lottery law creates a new program that provides construction aid to counties.
However, Berger believes that what Easley is proposing is only step one down the supplanting path. He expects step two to be a merging of the two school construction programs.
It'll be interesting to see if that plays out. Cutting the corporate income tax has been a big priority for the governor and the Senate, not so much for the House. In fact, the House pretty much nixed a cut to the corporate rate last year because the budget did nothing to reduce the taxes they saw as a priority: sales tax and personal income.
Using lottery dollars to replace -- yes, supplant -- money from that tax would allow budget writers to cut (slightly) the corporate rate without imposing more sales or income taxes or cutting programs.
Berger may just be on to something.
And just to round things out, the full statement Gov. Mike Easley issued yesterday reads:
Education lottery money will supplement, not supplant existing spending for education and I will not recommend nor sign legislation that reduces the state’s spending for education.Since 2001, when we began pre-k and class size reduction efforts, I have consistently said that once an education lottery was enacted, we would use the proceeds to fund these priorities permanently. The lottery will always be the source of funding for these programs in good and tough economic times. In addition, the education lottery funds college scholarships and school construction as provided by law.
Okay...discuss among yourselves.