2006 Rural Partners Forum
Remarks by Sen. Walter Dalton
I think you can be very proud of North Carolina. If we look back over the last 10 years, you’ll find North Carolina has made more improvement in academic performance and public education than any other state in the country. You look at our national assessment scores, our SAT scores, and we’re making more improvement than any other state.
This was a far better budget year, but we know that in the late ‘90s and into early 2000, we were facing job losses to China. We were facing the loss of the tobacco industry, and if you were a state legislator, that was very frustrating because we lost those jobs not because of anything we did, but because of federal trade policy and currency exchange rates. It was a tough time. And I thought it was interesting. I represent Rutherford and Cleveland County. When Governor Easley came into office, he realized he was facing the largest national recession that we had had since the Great Depression. He actually asked, “Who was governor in the Great Depression?” And it was O. Max Gardner, who was from my area, and he looked at that formula. And he found out that during the Great Depression, only one state kept its public schools open, and that was North Carolina.
So, during these tough times, we tightened our belt. Annualized growth of the budget, when you adjust for population, was only 2.8 percent per year, but we continued to raise teacher pay, lower class size and improve academic performance and invest early childhood education. And it has really paid dividends for North Carolina. This last year we had a $2 billion surplus. I think it shows that we have weathered the storm. Why did we have a $2 billion surplus? First, conservative growth estimates. We were very conservative, and what we said was about 5 percent actually ended up being about 12 percent. The market had rebounded, capital gains were better. But, most of all, the jobs had turned around. We are beginning to recover from this economy.
One thing I want to dispel, somebody says, “Yeah, they had a $2 billion surplus, and they spent it all.” That is not true at all. We put $340 million into the Rainy Day Fund and disaster relief. Our Rainy Day Fund is as strong, I think, as it has ever been. We gave tax relief of about $200 million. We also expanded education by $300 million over and above just the normal growth, and a lot of that will particularly help rural counties. We fully funded the Low Wealth Schools Fund for the first time. We restored a cut of $44 million to the Disadvantaged Student Fund. About $300 million that will really benefit, I think, a lot of the schools there in rural North Carolina and our cities also, but particularly those that fall into the low wealth formula.
I’m a member of the SREB Board, the Southern Regional Educational Board. Only in politics can New Jersey be a Southern state, because it is a member of that. But we do have challenges in the future, and our dropout rate needs to be improved. We actually are better than most of our surrounding states, except Virginia, but the dropout rate is huge. They had this statistic. If you look at last year and all of the high school students that dropped out, had they remained in school and graduated, just that group of people, the difference in their earning capacity between being high school graduate and a dropout over their life time, for last year, was $10 billion. We have to address that. That is for all of North Carolina.
But I believe that we are doing the right things, making the right investments. Take Dole Foods for instance, which came in with a great vision there at the Kannapolis campus and at the processing plant. And they are looking at additional investments in North Carolina. Affordable healthcare is a challenge, as Senator Kerr said. The $20 million to the Rural Center—I know Representative Owens and I worked very hard on that three years ago. It was a one time appropriation and now we’ve made that recurring. And it is a start on what we’ve talked about in water, sewer and technology. And technology is absolutely key. The Business Technology Center, which was funded by the Rural Center, has helped bring that data center to our area. So, those are the types of things that we need to invest in.
We gave a tax credit for biofuels. You’ve heard the presentation on that in your earlier session. As we go forward in the future, I will tell everybody that food and fiber is still going to be needed. Rural areas and farming areas will survive, and I hope thrive. Biotech and biofuels will provide a new economy for rural North Carolina. And some people tell me, “Well, that’s the Research Triangle.” It’s not the Research Triangle. It’s Glaxo Wellcome manufacturing pharmaceuticals in Zebulon, North Carolina. It’s Baxter Travenol manufacturing pharmaceuticals up above Marion in McDowell County. That is what we have to do. But the main thing is, we have to work together. We have to keep our eye on the ball. We have to do the water/sewer technology infrastructure that will bring that prosperity to all of North Carolina. Again, I thank you for what you do for North Carolina. We all have to work together. We have to find the resources to do these things. I thank you for the opportunity to be with you.
