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Ferrel Guillory: At last, K-12 schools could see capital funding infusion

By Ferrel Guillory

When I first moved into my office in the far back corner on the third floor of Carroll Hall on the UNC-Chapel Hill campus, I looked down on an inelegant parking lot. Now, out of the west-facing window, I see an expansive red brick wall of Chapman Hall and its slightly arched connector to Phillips Hall.

Chapman Hall, which houses departments of mathematics, astronomy, and physical sciences, serves as a reminder of the $3.1 billion bond issue of 2000. Passage of that bond issue in all 100 counties was hailed by university and community college officials as a potent signal of North Carolina’s commitment to public higher education.

At the time, the Chronicle of Higher Education described it as the “largest bond measure for higher education in the nation’s history.” In today’s dollars, that bond issue would amount to more than $4.5 billion.

In 2016, voters approved the $2 billion NC Connect bond issue to finance university and college construction and renovations along with improvements to parks and National Guard facilities. Yet there has been no state bond issue for pre-K-12 public schools since 1996.

Now, a variety of proposals offer the General Assembly an opportunity to respond to documented needs for new schools, additions and renovations. The needs range from modernizing dilapidated buildings in economically stressed rural communities to providing classrooms to accommodate fewer students per teacher in grades K-3. The most
recent facility needs survey puts the backlog at
$8 billion.

House Republicans support a $1.9 billion bond proposal — $1.5 billion for public schools and the remainder for universities and community colleges. Democratic Gov. Roy Cooper has proposed a $3.9 billion bond package — $2 billion for K-12 schools, $500 million for higher education and $900 million for the state zoo, the history museum and water and sewer projects.

An alternative plan, originating with Senate Republicans, would increase the portion of annual general fund revenues dedicated to the capital and infrastructure fund. One-third of the funds would go to public schools, one-third to community colleges and universities and the rest to general government projects. This plan has been characterized as “pay as you go.”

As such, the year-by-year way of dealing with school facility needs calls to mind the “pay as you go’’ approach to government that defined Virginia during much of the 20th century. Harry F. Byrd served as Virginia’s governor from 1926 to 1930, then for 32 years as a U.S. senator.

In “The Book of America: Inside 50 States Today,” published in 1983, co-authors Neal R. Peirce and Jerry Hagstrom succinctly captured the policy trade-off in Byrd’s rigid, no-debt budgeting. “As a staunch fiscal conservative, he adopted a ‘pay as you go’ approach that managed to convert a $1 million state deficit into a generous surplus by the time he left office in 1930,” they wrote. “Yet the same policy would penalize Virginia in the long run, leading to a drastic underfunding of essential services.”

While North Carolina did not go so far as to embrace Byrd-style governance, a strain of fiscal conservatism has long influenced state budgeting. That strain is especially evident in the allegiance paid, among Democrats and Republicans, to preserving a triple-A bond rating. The highest bond rating allows the state to borrow money at the lowest interest rates. So why not use it?

The good news is that legislators across party lines recognize the time has arrived for an insertion of state financing into local school construction and renovation — even though their proposals fall well short of $8 billion. The risk is that House and Senate, Democrats and Republicans, will fall into stalemate over bonds versus pay as you go. As one example that I watched under construction and have gazed at for several years, Chapman Hall illustrates what a voter-approved bond issue can wrought.

Ferrel Guillory director of the Program on Public Life and a professor at the UNC School of Media and Journalism as well as vice chairman of EducationNC.

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