The Skyland Post

A Recommended Budget Of $154,514,000 Sets Record

Vast Tax Spending Program Is Handed To Legislature. 14 Million Larger.

Raleigh, Jan. 9.—Administration-sponsored bills calling for the largest tax and spending programs in North Carolina's history were introduced in the General Assembly tonight, as legislators reconvened here for their second week of law-making.

Under measures, which were drafted by the advisory budget commission, the state would operate under a balanced budget providing for the expenditure and the collection of $154,514,899 during the 1939-41 biennium.

Accompanying the bills was a budget message from Governor Hoey, which warned the legislators that any increase in the recommended appropriations would require an increase in taxes. The message was delivered by the reading clerk in each house.

Governor Hoey's message pointed out that the proposed budget made no provision for the addition of a 12th grade to the public schools or the establishment of a retirement fund for teachers and other state employees.

Decisions on those matters, he said, had been left entirely to the legislature.

The chief executive reiterated his opposition to a proposed constitutional amendment to ban the diversion of highway funds, but promised that no highway funds would be diverted "unless it is absolutely necessary."

Asserting that there were no basic change in the tax bill, Governor Hoey added:

"The objection to levying more taxes is twofold; first, it is extremely difficult to levy additional taxes, without doing an injustice to the already burdened taxpayers; and, second, if business should develop satisfactorily the new taxes will not be necessary."

Raleigh, Jan. 9.—A record budget calling for state expenditures of $154,514,899 during the 1939-40 biennium went to the legislature tonight with Governor Hoey's recommendations that very few changes be made in the state's tax laws.

The budget compared with a recommended $140,419,146 two years ago, when the legislature voted to appropriate $146,985,302.

Four years ago the recommended budget for the 1935-37 biennium was only $114,428,523, but many changes were made, resulting in actual expenditures in 1935-36 of nearly $11,000,000 more than the budget recommendations had been. The budget statement set forth that a balanced financial sheet was expected on the basis of recommendations, but it showed that the general fund would end the 1939-41 biennium with only $39,693 in surplus while it was figured it would start the period with $2,200,000 carried over next June 30.