Other stories below: To the winners go the spoils in House office assignments.... NCCBI leaders take positions on transportation education issues.... Public hearing set on Western Wake Expressway.... DOT awards $50 million in highway contracts.... 80 Randolph County leaders attend magazine unveiling.... Names in the News.... 

This issue of the Bulletin is being delivered a day early because of the Easter holiday.

Acting with amazing speed, the House
wraps up work on $15 billion budget bill
The House was expected to finish work today on a $15 billion budget bill and observers are marveling at how smoothly and how quickly the usually rambunctious chamber acted. The House gave second-reading approval to the budget on Wednesday by a 75-43 margin and was expected to hold a final vote later today and then ship the document over to the Senate. It’s only the second time in 21 years that the House has completed its budget deliberations before the start of the July 1 fiscal year, an achievement many credit to the teamwork of the Republican and Democratic co-speakers.

The House budget spends about $65 million less than what Gov. Mike Easley proposed. Voting for the budget were Republican Speaker Richard Morgan and the several centrist Republicans in his corner, plus all the Democrats except Rep. Mickey Michaux of Durham.

The whirlwind of budget activity began Monday when a bill suddenly popped out of the House Appropriations Committee that largely tracked Easley’s blueprint but went against him on a couple of issues. For example, H. 397 2003 Budget/Family Tax Cut/AAA Bond Rating earmarked only $25 million for the Clean Water Trust Fund – he asked for $66.5 million -- and $30 million less on health and human services programs.

Other notable items: The budget bill raids the highway funds for $252 million in cash and grabs $40 million from the tobacco settlement fund. It offers state employees a 1.6 percent pay raise, teachers a 1.8 percent raise and community college professors a 2.1 percent raise at an overall cost of $132.4 million. It increases UNC System tuition by 5 percent and community college tuition by 3.2 percent. Retired state employees would get a 1.28 percent COLA that will cost $39.2 million next fiscal year. The bill also appropriates $1.6 million for the Global TransPark next fiscal year but zero in the second year of the biennium, as Easley proposed. That’s a death knell for state support the long running project unless the Senate intervenes. Together, the Appropriations Committee reduced the red ink in Easley’s original recommendations from $460 million to $384 million.

Hardly pausing for breath, the House Finance Committee voted out a tax package on Tuesday that wiped out the red ink Appropriations left in the budget bill. Several moderate Republicans joined all the committee Democrats in voting 22-13 to accept the biggest two of the four revenue-enhancing measures the governor wanted – continuing for two years the extra half-cent state sales tax and the top state income tax rate (8.25 percent) on residents in the highest income bracket. Finance turned down the governor’s two other revenue measures -- an increase in the child tax credit from $60 to $100 over two years and elimination of the marriage penalty by increasing the standard deduction for married couples by $1,000. The revenue package approved by the Finance Committee also includes $45 million in new fees, with $38 million generated from higher regulatory charges on insurers and public utilities. Another provision would allow the state to finance $200 million in repairs and renovations through the sale of CPs -- certificates of participation.

Finance spent two hours arguing the merits of raising the cigarette tax by 45 cents to 50 cents a pack. Health advocates lined up to support Rep. Jennifer Weiss’s (D-Wake) bill, saying an increase in the cigarette tax would decrease teen smoking. Speaking against the bill, NCCBI Vice President of Governmental Affairs Leslie Bevacqua said NCCBI opposed the bill and would oppose any tax increase that singled out a particular industry. She acknowledged that the House was facing a shortfall in their budget and that NCCBI “would not oppose, as we have stated previously, continuation of the half-cent sales tax and the tax on upper income individuals, as long as it had a two-year sunset provision. NCCBI is, however, opposed to new taxes that would hurt businesses in North Carolina which provide jobs and help our economy.”  Speaking on behalf of the tobacco industry, Roger Bone noted the economic impact that tobacco-related industries have on North Carolina’s economy and urged the committee not to support the tax increase. Lacking the votes to win, Rep. Weiss withdrew her bill. “We wanted a fair debate before we would lend our support to any other options,” Weiss said. “We got that debate.”  The Finance Committee then quickly voted for continuing the half-cent sales tax and the higher income taxes for two years.

The pace continued Tuesday night when the Rules Committee met and merged the Appropriations Committee’s spending plan with the Finance Committee’s revenue package and –voila! – the House has its budget, which was quickly calendared for floor debate the next day. Democrat Speaker Jim Black and Republican Speaker Richard Morgan restored some items axed by Appropriations, including  $590,000 cut from a program that trains attorneys appointed to represent death-penalty defendants, and $90,000 in cuts to Commerce Department economic development programs that help minority businesses.

The final budget bill, although considered bare-bones by most and including $860 million in spending reductions recommended by the governor, still increases state outlays by about $617 million from the current fiscal year, mainly in education due to rising school enrollments, rising bond debt payments and Medicaid expenses. The budget also includes $100 million for the Rainy Day Fund and $36 million for local governments to make up for appropriations they lost from the state this year. It assumes a conservative 3.5 percent growth in tax revenues.

 
We’ve boiled down the inch-think budget bill to five pages of charts at the end of this newsletter. Included are line-item-by-line-item spending plans for all major program areas of state government, plus a chart detailing salaries of top state officials.

To the winner go the spoils in House office assignments
Nearly three months after the session began, members of the House finally know for sure where to hang their hats. That decision came this week with the announcement of permanent office assignments by Speakers Jim Black and Richard Morgan. On the Republican side, the better office space went to the handful of legislators who helped Morgan in his battle against the GOP establishment. The Republicans who opposed Morgan were assigned to small, windowless offices, including Reps. Billy Creech of Clayton, Ed McMahan of Charlotte, Frank Mitchell of Olin Leo Daughtry of Smithfield. Black was more magnanimous. A chart showing every member, their office address and office phone number is below.


NCCBI leaders take positions on transportation, school issues
Seventeen members of the NCCBI Executive Committee held a spirited discussion on two major pieces of legislation in a conference call meeting Tuesday afternoon that was moderated by Chair Sue Cole. The discussion centered on the NC Moving Ahead transportation bill and legislation designed to prohibit public schools from opening until the day after Labor Day each year

NCCBI coordinated the 1996 bond campaign for K-12 school construction and highways. Legislation sought by Gov. Mike Easley, entitled NC Moving Ahead, has been introduced in the General Assembly that would redirect $700 million of the $950 million approved by the voters in t996. The executive committee decided to give the new spending plan its qualified endorsement although members expressed some dissatisfaction regarding changes made seven years after voter approval. There was agreement that legitimate transportation needs far outstrip available money and that population growth had caused severe congestion, especially around the state's cities. After the meeting, NCCBI issued the following statement

“NCCBI believes the first priority of expenditure of any highway trust fund balances should be used, as originally intended for intrastate system projects, urban loop projects, and secondary road projects identified in the original trust fund legislation. We urge and support efforts by the administration and the General Assembly to analyze, identify and resolve legal, environmental or other impediments that are preventing the delivery in a timely manner of authorized TIP projects provided for in the highway trust fund that are necessary to support a comprehensive transportation system and to promote an enhanced quality of life.

“Given the delays in projects due to environmental analyses, NCCBI urges the legislature to take appropriate action to ensure that the Department of Transportation and the Department of Environment and Natural Resources are working together in constructive ways to speed the review and permitting processes necessary to accelerate promised construction of urban loops and intrastate highways.

“If accelerating loop and intrastate construction projects proves impossible due to environmental delays, NCCBI would support flexibility in spending bond monies, as long as it does not have a fiscal impact on delivery of the TIP and is focused, as the bond issue was, on relieving congestion and adding capacity to our transportation system. Any changes in the allocation of the bond funds should be focused on urban congestion mitigation measures such as reducing signal delays, widening major facilities and replacing intersections with interchanges on existing intrastate and loop facilities, and for congestion alternatives such as urban regional rail systems. Distribution of funds should be allocated in areas of greatest need and should not be subject to the equity formula. Funds used for transit should only be used for matching federal grants.” 

On the other issue, the executive committee voted to oppose the legislation that would prohibit local public schools from opening until Labor Day. The legislation was introduced in an effort to give a boost to the tourism industry, which has encountered staffing problems during the month of August because of the early beginning of public schools, colleges and universities. In addition, it was felt that a longer summer tourist season would generate more income for the industry and additional taxes for the state.

NCCBI, long a supporter of more local control for boards of education, decided that the local control and flexibility issue, along with how the later starting date might affect tourism in the mountains during the winter months as a result of changes within the calendar during the school year (fewer teacher workdays, fewer vacation days, and thus, fewer long weekends), were more important than any other arguments for the later starting date.

Staff members Leslie Bevacqua and Phil Kirk participated in the meeting.

State Government

DOT sets public hearing on Western Wake Expressway
The N.C. Department of Transportation will hold an informational workshop on the proposed Western Wake Freeway on Thursday, April 24, 3 p.m. to 8 p.m. at the Carpenter Fire Station in Carpenter. The Western Wake Expressway, a roughly $150 million segment of Raleigh’s Outer Loop, will run from N.C. 55 at Old Smithfield Road to N.C. 55 near Alston Avenue in Wake County (see map at right). The Expressway will be a six-lane, median divided, controlled access freeway with interchanges at the N.C. 55 Holly Springs Bypass, U.S. 1, Old U.S. 1, U.S 64, and Green Level Road. The Western Wake Freeway, about 20 miles long, will tie to the Northern Wake Freeway at N.C. 55 near Alston Avenue, north of Cary. DOT representatives will be available to answer questions and receive comments from the public about the project. For more information, contact Jennifer Harris at (919) 733-7844, ext. 268, email jhharris@dot.state.nc.us or write to and reference TIP project number R-2635.

DOT Board awards nearly $50 million in highway contracts
The N.C. Board of Transportation awarded $49.9 million in highway improvement contracts for projects in 13 counties statewide at its last meeting. Included were contracts to:

 Install median guardrail on 3.4 miles of U.S. 70 from west of N.C. 43 to the Trent River Bridge in New Bern in Craven County. Reynolds Fence & Guardrail Inc. of Indian Trail was awarded the contract for $82,857. Work will begin between April 28 and Aug. 1 with completion scheduled 90 days thereafter.

 Widen two sections of N.C. 55 from north of U.S. 64 in Apex in Wake County to S.R. 1121 in Durham County to four and five lanes. Blythe Development Co. of Charlotte was awarded the contract for $34.7 million. Work will begin in April with completion scheduled in June 2006.

 Build a bridge in Thomasville to carry traffic on Peace Street over railroad tracks of Norfolk and Southern Railroad. The bridge will allow officials to close the at-grade railroad crossings at Peace Street and Hoover Street. APAC Carolina Inc. of Greensboro was awarded the contract for $3 million. Work will begin in June with completion scheduled in October 2004.

 Resurface 4.1 miles of U.S. 421 from S.R. 1171 to the Yadkin County line in Forsyth County. The contract also calls for building two roundabouts at the intersections of Concord Church Road and access ramps at the U.S. 421 interchange.

 Eliminate sharp curves on S.R. 2136 in Mecklenburg County from west of Ranson Road S.R. 2138 east of Huntersville. Left-turn lanes will be added at Binaway Drive, McCoy Road and Ranson Road. Blythe Development Co. of Charlotte was awarded the contract for $1.4 million. Work begins in April with completion scheduled in December 2004; and

 Install median guardrails on 19.2 miles of U.S. 74 from east of Interstate 26 in Polk County to U.S. 74 A at Forest City in Rutherford County. Reynolds Fence & Guardrail Inc. of Indian Trail was awarded the contract for $830,352. Work will begin between April 28 and Oct. 1 with completion scheduled 270 days thereafter.

The board also awarded contracts to replace bridges over:

 Young's Swamp on N.C. 50 west of Skeeter Point in Sampson County. T.A. Loving Co. of Goldsboro was awarded the contract for $388,143. Work will begin in April with completion scheduled in November.

 South River between Cumberland and Sampson counties. The bridge carries traffic on S.R. 1246 in Cumberland County also known as Butler Island Road in Sampson County southwest of Roseboro over the river. Dellinger Inc. of Monroe was awarded the contract for $664,819. Work will begin in September with completion scheduled in May 2004.

 Travis Creek on S. R.1504 north of Elon College in Alamance County. R.E. Burns & Sons Co. Inc. of Statesville was awarded the contract for $436,113. Work will begin in April with completion scheduled in November.

 Buffalo Creek on S.R. 1130 and S.R. 1185 southwest of Warrensville in Ashe County. James R. Vannoy & Sons Construction of Jefferson was awarded the contract for $861,099. Work will begin in April with completion scheduled in August 2004; and

 Fisher River on S. R. 1341 northwest of Dobson in Surry County. Smith Rowe Inc. of Mount Airy was awarded the contract for $713,869. Work will begin in April with completions scheduled in December 2004.

Briefly Noted: The amount of garbage North Carolinians sent to landfills rose by 251,000 tons in 2001 over the year before, according to a new report issued by the state Department of Environment and Natural Resources.  During the year just over 10 million tons of waste went to landfills, the report said, or about 1.22 tons per person.

Three Left Out: Last week's Bulletin listed the organizations involved in the coalition which secured the passage of H. 429 Property Rights Just Compensation legislation. Regretfully, three organizations were omitted from the list: the Independent Garage Owners of North Carolina, N.C. Restaurant Association, and the N.C. Homebuilders Association.

Fast Facts: After peaking at 18,542,000 in July 2000, manufacturing employment in the United States has fallen by 2.2 million over 32 consecutive months, including a drop of 36,000 jobs in March, to 16,352,000 currently. Since July 2000, North Carolina has lost 96,600 manufacturing jobs, or one of every eight.


NCCBI News

80 Randolph County leaders attend magazine unveiling
Speaking to 80 community leaders on the official unveiling of the Randolph County community profile in the North Carolina magazine, NCCBI President Phil Kirk praised the people of the county for their "positive, can do attitude and spirit" at a breakfast last Friday at the AVS Banquet Centre in Asheboro. Kirk told the audience communities that value public service and public education are chosen for magazine coverage in special sections. Good transportation and quality health care are also important factors.

He saluted the county for its emphasis on diversity in economic development, including its growing tourism base. "Travel and tourism is bringing in 43 million visitors a year who bring $12 billion into our economy annually. We are now the sixth most visited state in the nation," he said. "Manufacturing and agriculture and agribusiness remain strong economic factors in our state, and we must do everything we can to help them to not only survive but to prosper."

Kirk also saluted the Petty family for its many contributions to Randolph County with an emphasis on the Victory Junction Gang Camp now under construction. He also praised the spirit of volunteerism and philanthropy that is present in Randolph County. Asheboro Mayor David Jarrell introduced him. Other speakers included John Stanley, chairman of the Randolph County EDC and mayor of Liberty; Richard Brooks, president of the Asheboro/Randolph Chamber; Morris Hayes, president of the Archdale/Trinity Chamber; and Phil Kemp, chairman of the Randolph County Commissioners.

Kirk paid special tribute to Bonnie Renfro, president of the Randolph County Economic Development Corp., for her invaluable work in helping to make the community profile a success. He also thanked the advertisers, Steve Johnson who sold the ads, and Ned Cline who wrote the profile.


Two other groups honor Kirk for educational leadership
NCCBI President Phil Kirk received two additional recognitions last week as a result of his nearly six years of service as chairman of the State Board of Education. He has announced his plans to retire as of May l. Krista Tillman, outgoing chairman of the board for the North Carolina Business Committee for Education, presented a Steuben crystal apple to Kirk and praised his commitment to high standards for educators and students. Kirk spoke on a panel at the group's annual meeting at Exploris last Thursday, along with former senator Howard Lee, Tammy Brown of Progress Energy, Beth Lucas of the Department of Commerce, and Tom Williams, Superintendent of the Granville County Schools. Earlier in the day, the North Carolina Schools Public Relations group presented Kirk with a beach towel with his name monogrammed in gold on it. "This is something I do not have," Kirk quipped. "And it is something I hope to use more often."  

Names in the News

Companies recognized for helping non-profit community
Three foreign-owned North Carolina companies were awarded the N.C. International Community and Economic Development Award for their commitment to helping the state's non-profit community. Sponsored by the N.C. Department of Commerce, the N.C. Commission on Volunteerism and Community Service and the state Ports Authority, the awards were presented by Commerce Secretary Jim Fain. The winners were Nortel Networks for large firms, Schindler Elevator Corp. for medium-sized firms and EMJ America Inc. for small firms. Businesses were selected based on the impact their company has made in their community through the success and recognition of community service programs, their executive leadership and commitment to community service, their corporate mission statement and values, and the extent of employee participation and service involvement in their local community.

 Elected as officers of the N.C Electric Membership Corp., the power supplier for 26 of the state's 27 electric cooperatives were:  Curtis Wynn, executive vice president and CEO of Roanoke Electric Cooperative (EC), Rich Square, president; J. Ronald McElheney, CEO of Jones-Onslow Electric Membership Corp. (EMC), Jacksonville, vice president; Buddy Creed, vice president and CEO of South River EMC, Dunn, secretary-treasurer. Elected officers of the N.C. Association of Electric Cooperative, the trade association for the 27 cooperatives, were: J. Dean Carpenter, a director of Rutherford EMC, Forest City, president; Michael S. Beasely, executive vice president and general manager of Surry-Yadkin EMC, Dobson, vice president; Walton J. Fulcher, president of Cape Hatteras EC, Morehead City, secretary-treasurer.  Elected as officers of the Tarheel Electric Membership Association, a member-owned cooperative serving the state's 27 electric cooperatives as a central purchasing and warehousing facility, were:  L. Calvin Duncan, secretary-treasurer of Brunswick EMC, Shallotte, president; Richard R. Grady, a director of Tri-County EMC, Dudley, vice president; Norman Sloan, executive vice president and general manager of Haywood EMC, Waynesville, secretary-treasurer.

 Danny Lineberry, chief of staff for Democratic Speaker Jim Black, has left to accept a new job in the Office of Information Technology Services. A former political reporter for The Durham Herald-Sun, Lineberry had worked for Black for six years.

 David Redwine, the former state representative from Brunswick County, was selected as this year’s recipient of the Public Policy Award presented by the North Carolina chapter of the International Association of Personnel in Employment Security. The honor recognizes an individual who successfully sponsored legislation to improve and strengthen workforce development systems.

 Wake County Economic Development, a program of the Greater Raleigh Chamber of Commerce, was named one of the top 10 non-state economic development agencies in the country by Site Selection magazine. The top groups were chosen based on new jobs, new jobs per 10,000 residents, new investment amount and new investment amount per 10,000 residents.

 Senate Minority Leader Patrick Ballantine of Wilmington will formally announce his candidacy for the Republican nomination for governor next month, according to a story in the Wilmington paper.
 

Summaries of H. 853 Governor’s Budget Bill as passed by the House Appropriations Committee:

Total General Government

$312,644,082

$312,077,082

Recommended

Recommended

  Discretionary Funds 

10,000,000

10,000,000

Below are the permanent office assignments and office phone numbers for House members.
Rooms with three-digit numbers are in the Legislative Building; rooms with four-digit numbers are in the Legislative Office Building.