How did Kay Hagan feel about the 2003 budget?

As a first-time cochairwoman of the Senate Appropriations committee, the Greensboro Democrat was quoted about two dozen times on the budget that year.

With Hagan running for U.S. Senate, the budget will come up again.

In the beginning, Hagan told reporters that she wanted to see more cuts related to government efficiency and higher raises for state workers (Greensboro News & Record, March 6). After the Senate put forth its plan, she called it "a good budget" that allocates money "in a wise and careful manner" (Charlotte Observer, April 29) and she worried that revenue would be down (N&R, May 5).

She also staunchly defended two proposed hikes in sin taxes on cigarettes and alcohol saying they are "a lifestyle choice" (N&R, June 12) and that the alternative, a lottery, wouldn't pass (N&O, June 12).

She added that the alternatives were worse: "I'm looking at not going to a four-day school week. I'm looking at not firing teachers. I'm looking at the basic infrastructure of the state, which is education and economic development." (Char-O, June 12)

She also stressed that the budget should be on time (N&R, June 16).

And she defended an additional $10.2 million in fee increases on things such as visiting a state park, operating a nursing home and getting a driver's license included in the budget.

"Those fee increases are very, very small," she said. "Some haven't been changed for years and years." (N&R, July 13)

What taxes were in the 2003 budget?

The first budget partially negotiated by state Sen. Kay Hagan included $14.8 billion in spending, a $400 million increase from the previous year.

The budget will likely come up again in the U.S. Senate race, with Republican Sen. Elizabeth Dole signaling that she will attack Hagan's record.

Here's a few details from the budget that she may focus on:

Temporarily Continued: The budget continued the "temporary taxes" on sales and the wealthy first instituted during a 2001 shortfall and set to expire in 2003. The two taxes were expected to generate about $384 million.

Sin No More: Senate leaders proposed adding 25 cents in tax to a pack of cigarettes and 5 cents to a can of beer, but House leaders shot the idea down. The taxes would have raised $326 million to offset proposed education cuts.

Higher (Cost) Education: Tuition at state universities went up 5 percent, though the budget added $5.1 million in need-based financial aid. In-state community college tuition rose 3.2 percent. For out-of-state students, it was 8.2 percent.

Obviously, there's a lot more to the budget than these three items, but they're the ones easiest to explain to voters in a short attack ad.

The N.C. Alliance for Health says 20 cents is not enough.

The nonprofit coalition of health care associations argues that Gov. Mike Easley's proposed increase in the cigarette tax from 35 to 55 cents a pack will not stop people from smoking.

In a press release, the group argues that tax increases of 20 cents per pack or less "provide no significant smoking reductions" or related savings in health care costs.

Instead, using the slogan "75 Saves Lives!," it argues that the state should raise the tax 75 cents.

The group argues that would preent nearly 95,000 pre-teens and teen-agers from starting to smoke while causing a 16 percent decrease in youth smoking. It would also raise $347 million, as opposed to the $111.4 million the lower increase would generate.

North Carolina currently as the seventh-lowest cigarette tax in the country. The tax has been raised only three times in the past 17 years, and legislators are skeptical about the latest proposal.

The state cigarette tax has gone up only three times in the past 17 years.

According to research by the N.C. Department of Revenue, the state's cigarette excise tax increased from 2 cents a pack to 5 cents a pack on Aug. 1, 1991.

It increased to 30 cents a pack effective Sept. 1, 2005.

And it increased again to 35 cents a pack effective July 1, 2006.

Those last two increases occurred during Gov. Mike Easley's watch. Easley has proposed raising the cigarette tax another time to 55 cents a pack in his 2008-09 budget in order to pay for raises for public school teachers.

The state currently has the seventh-lowest cigarette tax in the country.

Gov. Mike Easley may be courting the legislature.

On the heels of state legislators talking skeptically about his proposed increases in "sin taxes" on alcohol and cigarettes, Easley will reportedly be making a personal visit this afternoon.

It is unusual for Easley — or any other governor — to make their budget pitch directly. They usually leave that to the designated number cruncher — in Easley's case, Dan Gerlach.

This could be a sign that Easley is concerned his budget may not pass. Or he's feeling more gregarious after spending all that time campaigning for Hillary Clinton.

Or he's not coming after all, and this is all a ruse to get us to pay more attention to Gerlach.

Update: Easley's not coming, after all. No word on how the rumor started. 

Republicans object to the so-called "sin taxes."

At a press conference this morning, Republican leaders of the state House and Senate said that the state budget should not raise taxes on alcohol and cigarettes.

"In tough economic times, it is not the time to raise taxes, particularly the taxes that hit the poorest people," said Senate Minority Leader Phil Berger.

He called the governor's budget "an attempt at legacy building."

For their budget priorities, Berger and House Minority Leader Paul Stam called for cutting spending, completely ending the annual transfer from the Highway Trust Fund, putting a roads bond before voters in November and not raising any state taxes.

On non-budget items, they called for lifting the cap on charter schools, putting constitutional amendments banning gay marriage and curtailing the use of eminent domain before voters, making the murder of an unborn child a crime and ending the de facto moratorium on the death penalty.

Gov. Mike Easley's proposed "sin taxes" could be a tough sell.

In the $21.5 billion budget, Easley proposed increasing taxes on alcohol — four cents on a can of beer, three cents on a bottle of wine and four percent on liquor — to pay for changes in mental health care.

He also proposed boosting the cigarette tax by 20-cents a pack to raise teachers' salaries an average of 7 percent, helping bring the state's teacher pay to the national average of roughly $50,000.

But fellow Democrats in the legislature were dubious. House Speaker Joe Hackney said he was skeptical that any tax hikes would pass.

"We didn't anticipate any new taxes this year," Hackney said. "This is a year for tightening our belts. This is a year for looking for efficiencies. This is what our constituents are doing."

Senate leader Marc Basnight said the tax hikes come at a bad time. (N&O)