First town hall meeting raises emotions
by David Leone
WAKE FOREST — The N.C. General Assembly has been hard at work with tax reform, alternative education proposals and fixing other problems left by previous legislatures, state district 35 Rep. Chris Malone said Monday.
Malone, a Wake Forest resident, former town commissioner and county school board member, is serving his first term in state office. He spoke to two dozen residents and businesspeople during a Q&A session at Wake Forest town hall.
Though a large part of the forum was taken up by talk of legislative income tax proposals, a comment about the ongoing “Moral Monday” protests and arrests at the legislative building elicited a strong response from the Republican representative.
“It’s a performance,” Malone criticized, saying that the NAACP representative, the Rev. William Barber, and other opposition leaders are friendly to him when there are no TV cameras around.
“What we’re dealing with right now is a lot of anger just because we’re in power,” he said, lumping together the protesters with Democratic legislators who have lost their hold on the reins of power.
“They want that unemployment insurance to continue to go up until we’ve hit the wall. They were screaming like hell about the earned income tax credit. They were the ones to sunset it. We’re not going to tolerate these kind of lies,” he said.
“This state is in a very clear position. We need to get the economy going. We need to have an economic freedom and activity that puts us in the right [place]. Where they were going — because it was already degrading as early as 2000 and getting worse and worse — they were going to allow it to continue that way,” he added.
“When they hit the wall, instead of taking it on the chin and saying ‘We fouled up,’ they’ll blame George Bush, they’ll blame Rush Limbaugh, they’ll blame the General Assembly. They’ll find a white guy somewhere to blame.”
Mostly, Malone strove to define his efforts and promote bills he said he believes will help the state economy rebound and improve governance.
He touted unemployment insurance reform, which cut state unemployment’s top payout of $535 a week to $350 and reduces the number of payout weeks.
“We have a $2.4 billion deficit to the federal government,” to pay unemployment benefits, he said, adding that cutting unemployment allows the state to pay that off more quickly.
“Our unemployment rate is the fourth worst in the country and higher than all the [states] surrounding us,” he noted. “Our financial house has to be in order. We need to make sure we’re putting ourselves in the right position to succeed.”
One critical questioner asked how legislative reform will create “magic jobs.”
Malone said you have to look at what neighboring states are doing to make themselves attractive to industry. Lower income taxes is one avenue; but he also brought up incentives packages — which are often decried by conservatives.
Malone described it as necessary to catch up to what’s going on elsewhere.
“So long as other states are going to continue to provide incentives, even if it isn’t cash, we need some kind of incentives … until we find ourselves in a better place … where we are the mecca for jobs,” he said.
“We’re not in a position right now to hang it up and say (to out-of-state companies) you can pay the higher taxes … you’re going to have more regulation and we’re not going to give you an incentive. They’ll just laugh at us.”
Mark Marley, manager of a Wake Forest SunTrust bank branch, took issue with that sentiment. He pointed out how, during a presentation to the Wake Forest Area Chamber of Commerce last week, Ted Abernathy, executive director of the Southern Growth Policies Board said it’s regressive thinking to continue to focus on seeking industry to bring to the state.
Those jobs are rapidly being replaced by others in the professional services, technical services, education and health sectors, Abernathy described.
“We’ve had fewer jobs created because the manufacturing companies are doing more with less,” Marley cited. “We can talk about bringing manufacturing here, but they’re not going to be hiring.”
“I can tell you for a fact, from personal knowledge, that’s not necessarily true,” Malone answered. “It will be in some cases, it won’t be in other cases.”
He said he’s spoken to manufacturers who want to expand in-state.
He also shared information about a bill he’s sponsoring in which a current 6.75 percent sales tax on manufacturing equipment would be reduced to 1 percent or $80.
Taxes up in air
Another questioner estimated roughly 10 percent of the approximately 80,000 people in Malone’s district fall below the poverty line.
Criticizing proposals to cut back on income taxes, he asked, “What are the justifications for pushing all those tax additives down to the bottom side? As we try to close the gap and we add to the burden of those who are less privileged … what’s the rationale?”
There are three tax plans proposed, two in the state Senate and one in the House.
The House plan (HB 998) would create a flat 5.9 percent personal income tax rate, with the first $25,000 tax-free. It would also drop the corporate income tax rate from 6.9 percent to a flat 5.4 percent over five years.
One Senate plan would establish a flat personal and corporate income tax rate of 5.95 percent and implement a local sales tax of at least 2 percent.
A third plan offered by Sen. Bob Rucho would also flatten the tax rate, and pay for it by taxing Social Security, for instance, as well as medicine and food.
“I don’t support [that] Senate plan,” Malone said.
Malone pointed out that of the three proposals, the House plan is the least hard hitting.
HB 998, keeps existing deductions and doubles the child tax credit, he said. It also closes some loopholes to offset the loss of revenues from a lowered income tax rate, he added, though he didn’t cite specifics.
Malone didn’t shy away from places he disagrees with other legislators, and he also was quick to point out ways the government can think outside the box to save funds.
While on the Wake County School Board serving as facilities chairman, he said he pored over plans to build schools, helping to find a way to cut $7 million from a high school planned in southern Wake County right after the $70 million Rolesville High was built.
Schools’ staff, he said, refused to listen to alternatives.
“They didn’t want to hear about it,” he said.
That prompted one of the several educators in attendance to ask if the legislature had it out for schools' staff — asking if they were ever going to do anything to improve teacher pay or stop fighting teacher tenure. A Senate bill that would eliminate master’s degree pay increases after 2014 ignores the fact that a master’s degree is required for some education jobs, such as to be a guidance counselor, she said.
Dwayne Cooke, assistant principal at Wake Forest-Rolesville High, said most teachers he knows don’t care about tenure.
“They do their job and really love their job,” he said. “What they really like is less change (from year-to-year). Let’s stay with one thing we know is working, let’s stay with it so I can help kids. The more obstacles you keep putting in front of them, that’s what’s turning a lot of young people away.”
In the freewheeling back-and-forth with the attendees, Malone also touched on voter ID, estate taxes, health exchanges and regulatory reform, among other issues.
The legislature has only had six months to begin to work out these and other issues, Malone stressed, pointing to how even this week, the proposed tax plans were to get further scrutiny.
He also appealed to the public to give legislators some breathing room, to allow them time to make a difference for North Carolinians.
“Give us a chance,” he said.