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The following question came in via e-mail last week:

Nelson Cole is claiming in an ad in a local paper that he "cut state spending by $3 billion, the largest cut in state history, even bigger than during the Great Depression." I can't understand where he gets the foundation for that claim. Do you have any idea what he could base his claim on?

Click on the image to the side or at the end of this post (depending on how you're viewing this entry) to see the ad in question in a larger size.

Cole, a Reidsville Democrat currently serving a district that covers the southern two-thirds of Rockingham County, faces no Republican in the General Election but Bert Jones, a former county commissioner, has filed to run as an unaffiliated candidate.

Cole can lay some claim to shaping the state’s budget. He is an appropriations committee vice chairman and chairman of the appropriations subcommittee. While the work of the budget isn’t ever all one individual’s doing, it’s certainly fair to claim Cole did his part and that the committee’s leadership, all Democrats, were largely responsible for constructing the spending plan.

However, the $3 billion figure is problematic.

One way to calculate the budget cut would be to look at the highest recent state budget and look at spending for the current year. In the 08-09 budget year, the state budget totaled $21.4 billion. For the current fiscal year, the state budget is $19 billion.

That would be a $2.4 billion slim down in spending over the past two years, not $3 billion.

However, Democratic legislators calculated the state budget based on a continuation budget that anticipates what it would cost to maintain state services at their current levels with no cuts or changes. Since workers get raises and materials get more expensive, that continuation budget is almost always more expensive than the prior year’s budget.

At the beginning of the 2009-10 fiscal year, that continuation budget would have been $22.1 billion. And yes, that would get you a $3 billion difference between anticipated spending in 2009-10 and what was actually put on the bottom line in the 2010-11 budget year.

However…

… there’s the matter of how lawmakers handled American Investment and Recovery Act – so-called stimulus funding – from the federal government.

If you remember, that money was sent to temporarily replace state spending. The general idea was to avoid dramatic layoffs to teachers or big cuts to safety net programs like the Medicaid health insurance program for the poor.

The state budget for 2010-11 relies on about $1.6 billion in federal stimulus funding.

And because of how that money is handled in the state budget, that stimulus money is tallied as a cut. So when you add $1.6 billion of federal stimulus funding, according to legislative accountants, you subtract $1.6 billion in state spending and therefore your total budget number drops.

So while it IS a cut in how many state tax dollars are spent it IS NOT a cut in how much was spent on those programs.

To boot, this year’s budget counted on receiving $512 million in extra federal Medicaid funds, only $300 million of which Congress granted. Still, that’s another $300 million the state didn’t have to stop spending that it could cut as a state spending cut.

All of that can be a bit hard to follow. But at the end of the day, this is about $1.6 billion of spending that state tax dollars normally pay for and which are still being spent. And when lawmakers arrive in Raleigh next year, these programs will contribute to an anticipated $3 billion budget deficit they’ll have to stare down for the 2011-12 budget.

That is not to say lawmakers didn’t make ANY real cuts. In fact, it’s quite clear that everyone from public school students to Medicaid recipients has suffered some kind of funding cut during the past two years. Lawmakers were unable to give state workers pay raises and some departments cut programs or functions cut entirely.

Bottom line: The ad is misleading. The state has cut some of its annual spending, but the $3 billion claim is over-stating things. Clearly, the reader is meant to take away that Cole helped cut $3 billion in actual spending, which is not the case. While North Carolina will spend $3 billion less of its own tax money it is not spending $3 billion less on programs than it did three years ago. The $3 billion cut claim relies on an accounting quirk rather than actual cuts.

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Bonus fact check: The same ad claims that Cole was: “Ranked by his peers as the most effective legislator in the Triad.”

The only commonly recognized measure of effectiveness rankings in North Carolina is put out by the North Carolina Center for Public Policy Research. Cole was ranked the 13th most effective out of 120, which is not bad at all.

However, two things are troublesome about this claim. While “the Triad” is sort of a nebulous place, it typically includes Davidson County, the home of House Majority Leader Hugh Holliman. Holliman is ranked fourth most effective in the House, nine spots above Cole.

The other quibble you could have here comes because of the use of the term “legislator,” which would include the Senate as well as the House. In that case, Sen. Phil Berger, an Eden Republican, is ranked 11 out of 50 senators. Granted it’s a different chamber and Berger is competing with fewer people.

Bottom line: This claim, while not a fabrication and certainly based on a well-regarded ranking, may be a slight over-statement.