Huge State Surplus

What to do with two billion dollars. That's the question facing state lawmakers.

They opened the short session of the General Assembly Tuesday with the extra money thanks to surging tax revenues from real estate sales, a strong job market, and robust sales tax growth. The surplus is the highest since the early 1970s.

Governor Mike Easley suggests placing the money in reserve. That was included in his 19 billion dollar budget proposal. Among other things, it includes an eight-percent increase in teacher pay and a reduction of the state sales tax by a quarter-percent.