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A promise and a reckoning

RALEIGH — Thom Tillis said the campaign promise was a good thing.

The new speaker of the North Carolina House, just elected to the post by his House peers a couple of hours earlier, said Republicans couldn’t and shouldn’t back down now.

“We’ve staked ourselves out on this tax issue,” Tillis said.

Tillis, the former IBMer from the Charlotte suburb of Cornelius, was referring to a Republican pledge to allow $1 billion in sales and income taxes to expire as scheduled July 1.

Tillis made the same point during his speech on the House floor following his selection as speaker.

“We will sunset the income and sales tax increases that were imposed on working families and small businesses in the prior session,” he said.

Over in the Senate, the message was the same from the Republican taking over from longtime Democratic boss Marc Basnight.

“We will not extend those temporary taxes. We are going to keep the promises we made to the people,” said Sen. Phil Berger, a small-town lawyer from Rockingham County.

So, on the same day that they assumed power with historic majorities in the General Assembly, Republicans had indeed staked themselves out. With such direct talk, how could they back down?

A day earlier, just down Raleigh’s Jones Street, Gov. Beverly Perdue wasn’t quite so direct.

Last fall, Perdue had indicated that she wasn’t likely to include the extension of the taxes in her proposed budget. On the eve of the General Assembly’s convening, she had a different message.

“I don’t know what I’m going to do, quite frankly,” the governor said.

Of course, Perdue and the legislative leadership stand in different places, and I’m not talking about their physical locations or party affiliations.

Perdue and her staff are only weeks away from producing a proposed state budget. Legislative leaders and their budget-writing lieutenants are at least a couple of months away from coming up with their state spending plans.

At this point, Perdue is much further along in understanding exactly what will be required to close a budget gap estimated at $3.7 billion.

That figure, bandied about by both Perdue and legislative leaders, is exaggerated.

Tax revenue will grow in the next fiscal year, and projections could put the growth at around $800 million. Some money budgeted for the current fiscal year also will go unspent, perhaps as much as $700 million if Perdue and legislators can agree to some other cost-saving measures during the final five months of the fiscal year.

But even if the true budget gap is as low as $2 billion, pain is coming. Perdue is already staring at bitter-tasting choices that will be politically unpopular.

For a while yet, that reality won’t hit legislative Republicans. When it does, they won’t and can’t squirm on taxes.

Uncomfortable squirming is coming, though.

It’s inevitable when the pie grows smaller, but the same people — teachers, public school parents, health care businesses and public hospitals dependent on Medicaid dollars — demand the same things from government.

Scott Mooneyham writes about North Carolina politics for the Capitol Press Association.

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