July 3, 2008, at the NC General Assembly

HEADLINES:

_ House, Senate reach agreement on $21B NC budget bill, vote expected next week

_ Final budget bill leaves out using surplus for teacher salaries

_ Borrowing could increase $857 million over four years in budget bill

_ Senate tentatively backs plan to regulate, tax online ticket scalping

_ Local governments, farm group displeased with parts of Easley drought bill

_ Governor's mortgage foreclosure plan gets OK of House panel

_ Plan to prohibit children from riding in pickup trucks again changed

_ Additional money for pardoned prisoners approved by NC House

THE BRIEF:

BUDGET DEAL: Democratic leaders wrapped up work on a $21.3 billion budget plan for the new fiscal year that delayed two tax breaks in order to please Gov. Mike Easley. House Speaker Joe Hackney and Senate leader Marc Basnight said a deal was reached after two weeks of negotiations. The first of two required votes in each chamber could occur as early as Monday night. Easley complained that the budget needed an additional $45 million in savings for the new year because tax collections were off by an estimated $70 million in May and June. The chambers agreed to put off until 2010 the elimination of the state gift tax and the expansion of a refundable tax credit for the working poor. Democrats control both chambers of the Legislature, so passage is likely. Easley then would be asked to sign the budget bill into law.

EMPLOYEE SALARIES: Teachers won't get any extra raises should the economy improve in the budget bill agreed upon by House and Senate members. Gov. Mike Easley had supported a Senate provision that would have permitted him to raise teacher salaries beyond the average 3 percent pay increases given to them if state coffers received more money than officials currently project. But the final budget bill left out that provision. Senate leader Marc Basnight, D-Dare, said the wording of the provision made it very unlikely that it would have taken effect. Negotiators did raise the pay increase for new teachers to keep the raise on par with rank-and-file state employees. Other state workers would get the greater of a 2.75 percent increase or $1,100.

DEBT GROWS: The House and Senate decided they want the state to borrow more money than either chamber offered in their respective budget proposals. The final spending plan will authorize $857 million in debt — none of it requiring statewide voter approval — over the next four years for prisons, and university and state buildings. The House version of the budget suggested borrowing $550 million, while the Senate wanted to borrow an additional $120 million. Senate leader Marc Basnight said the construction is needed to prepare for the state's projected population growth and provides jobs for the state.

ONLINE SCALPING: Ticket-holders would be able to resell their tickets for profit online under a proposal tentatively approved by the Senate. Members voted 45-0 to change current state law that prohibits tickets from being sold for more than $3 above face value. Under the measure, ticket-holders would be authorized to resell their seats for any price. Sellers would be required to give refunds if the event is canceled or if the buyer does not receive tickets on time. Sponsor Sen. Fletcher Hartsell, R-Cabarrus, said a plan to regulate online ticket sales is needed, noting that seats are already being sold over the Internet with few consumer protections or regard for state law. The Senate needs to take a final vote on the measure before it can be sent to the House.

MORTGAGE PLAN: The mortgage foreclosure plan backed by Gov. Mike Easley got a favorable report in a House judiciary committee. The proposal would give the banking commissioner more power to negotiate with mortgage providers and homeowners who are struggling to pay high-rate mortgages. The commissioner also would be allowed to pause foreclosure proceedings for one month. Easley has called on lawmakers to approve the plan, which he said may help 25,000 North Carolina families keep their homes. The judiciary committee's vote sends the measure to an appropriations panel.

PICKUP TRUCKS: A plan to restrict children from riding in the open beds of pickup trucks was changed again, as a House judiciary committee voted to remove a provision that would have charged violators with insurance points. The plan, which was originally proposed by the Child Fatality Task Force as a way to reduce child deaths, has been tweaked several times. The most recent version of the bill prohibits children under the age of 16 from riding in the flatbeds. Current law prohibits people under the age of 12 from riding in the cargo area, but has an exemption for children who are being driven in a rural area and are supervised by an adult. The bill originally removed that adult supervision exemption, but it was restored to the bill by lawmakers in another committee. The bill now heads to the House floor. Sponsor Rep. Jennifer Weiss, D-Wake, said the new bill isn't as strong as the original proposal but is willing to concede on some of the exemptions.

DROUGHT RELIEF: Local governments and farmers are unhappy with portions of a drought response bill being sought by Gov. Mike Easley. The measure debated Thursday by a House committee would give more authority to Easley and future governors to prepare for and fight future droughts. It would require municipalities and other large water systems to reduce consumer water use by 20 percent in times of exceptional drought. Kim Hibbard with the North Carolina League of Municipalities says the provision is a one-size-fits-all solution that would make obsolete recently completed drought response plans. The North Carolina Farm Bureau also doesn't like language that restricts private well-water use. A committee vote could come early next week.

ERRONEOUSLY CONVICTED: People who were wrongfully convicted of a crime and granted a pardon of innocence by the governor would receive $50,000 for each year they were in prison under a measure overwhelmingly approved by the House. Current state law allows $20,000 for each year an individual was behind bars. The bill would more than double that amount, up to a maximum of $750,000. The current maximum is $500,000. Those exonerated also would be able to receive tuition money and job skills training. The bill now heads to the Senate.

THURSDAY'S SCORECARD:

In the Senate:

_ S488, to empower the town of Carrboro to set campaign contribution limits for local elections. Voted 46-0 to not concur with House version. Next: To conference committee.

_ S1697, to establish toll collection rules for the North Carolina Turnpike Authority. Tentatively approved 46-0. Next: Final Senate vote.

_ H2341, to limit the liability for certified child passenger safety technicians and training programs. Tentatively approved 42-0. Next: Final Senate vote.

_ H2463, to require mortgage servicers to register with the state and to establish reporting requirements. Tentatively approved 46-0. Next: Final Senate vote.

In the House:

_ H2397, to require a state board to perform criminal background checks on people seeking licensure to become a nursing home administrators and to allow the General Assembly to obtain similar checks for current employees and applicants. Tentatively approved 107-0. Next: Final House vote.

_ H2720, to require the state motor fleet to purchase new vehicles that are ranked in the top 15 percent of its class for fuel economy. Approved 62-46. Next: To the Senate.

_ H1134, to allow counties to develop plans to remove abandoned manufactured homes from their area and reusable and recyclable components by giving grants to reimburse counties for costs. Final House approval 104-13. Next: To the Senate.

In committees:

_ H1113, to use the public duty doctrine as a defense against negligence claims filed against state law enforcement or other state employees under the Tort Claims Act. Favorable report, Senate Judiciary I Committee. Next: To the full Senate.

_ H933, the Jessica Lunsford Act for NC, to increase the penalties for sex offenders. Approved recommendation to not concur with Senate version, House Judiciary II Committee. Next: To the full House.

AROUND THE STATEHOUSE:

Senate Republicans sent federal officials a letter calling on the government to permit offshore oil and gas exploration and to open the Arctic Natural Wildlife Refuge to drilling. The letters were sent to North Carolina's Congressional delegation, President Bush, and White House hopefuls Barack Obama and John McCain. Senate Minority Leader Phil Berger, R-Rockingham, said the country must tap its own natural resources as it battles with soaring energy costs.

OVERHEARD:

"This ain't a matter, ladies and gentlemen, about being green or brown, or city or county. This is a matter of life and death for North Carolina ... We cannot let this slide anymore." — Rep. Pryor Gibson, D-Anson, in urging members of the House Environment Committee to approve a drought response bill sought by Gov. Mike Easley.

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By Gary D. Robertson and Whitney Woodward.

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