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Welcome to this week`s edition of SPINCycle.
Be sure to tune in to this week’s NC Spin when our panel will talk about the House consideration of the budget, the big shakeup at DHHS, and privatizing state services. This week’s panel includes former Attorney General and Secretary of State, Rufus Edmisten; Chris Fitzsimon, Director of NC Policy Watch; Becki Gray, columnist with Carolina Journal; John Hood, President of the John Locke Foundation and moderator Tom Campbell.
Tom Campbell`s Spin
The Senate’s proposal to borrow half a billion dollars is fiscally irresponsible. Borrowing money a terrible, horrible, no good, very bad idea.
Heard on the Street
The Senate wants to do what?
The rumbling you hear is reaction to the Senate`s horrible idea of borrowing half a billion dollars to repair a few buildings and spend $260 million on engineering facilities at NC A&T and NC State. Am I missing something or are we in the midst of a financial crisis that necessitates cutting almost 800 million dollars from current state spending? And aren`t we projected to have a budget deficit next year that could amount to 3 billion (with a B) dollars? What in the world could possibly convince Senate leadership that now is the time to go out and borrow $500 million?
One of the problems with doing everything behind closed doors is that bad ideas are not exposed early on. Reaction has been extremely negative, except in the Senate. Even Republican Richard Stevens, normally a fiscally responsible legislator, is drinking the Kool-Aid. Treasurer Janet Cowell might have been too subtle for Senate leaders to grasp that she was telling them politely this was a bad idea.
Our state has agreed to allow debt service payments of no more than 4 percent of state spending. If we borrow the 450 million the Senate proposes, the amount will exceed 4.25 percent. Even if we don`t borrow more money the debt service will be at 3.99 percent by 2012.
For more discussion on this be sure to hear this week`s NC SPIN program and read My Spin, “Borrowing Money a terrible, horrible, no good, very bad idea.”
“We`ve already cut the fat, this cuts the muscle” blues being sung frequently.
While the Senate has been rightfully criticized for putting the budget together behind closed doors there is only a degree of difference in the House. In subcommittee meetings the various chairs are openly reporting that they have been given instructions to do…. A small group in the House is also running the show, even though there is more openness than in the Senate.
One thing observers are picking up as the House goes through the budget discussions it is apparent there is a big pot of money not being brought into play. House leaders are hush-hush and there are two lines of thought about what is happening. One has the House proposing a full-scale invasion of the Lottery Trust Fund to provide enough to k-12 education so as not to have to fire any teachers.
Josh Ellis of State Government Radio reports that there is real concern that the feds will not come through with the additional $500 million needed to fund Medicaid beginning in January. If this patch doesn`t come through, there is an additional half a billion dollar hole to fill. Appropriations co-chair Mickey Michaux says the federal relief package is falling behind schedule. Governor Perdue went to Washington last week to encourage this and other federal relief funds.
The House Education package will differ from both the Governor and the Senate. Governor Perdue proposed cutting the education budget by $238 million. The Senate reduced spending by only $158 million but the House Education subcommittee approved cuts of $360 million. $108 million of those cuts would come from the University System. UNC Board of Governors chair Hannah Gage, from Wilmington, was the latest to sing the “we`ve already cut the fat, this cuts the muscle” blues.
By the way, the House education budget does eliminate the in-state tuition credit for out-of-state athletes. That`s about an 11 million savings. Now that Tony Rand has left the Senate it will be interesting to see if the House can prevail on this issue.
House budget leaders also say they want to restore some money to Health and Human Services programs that were cut by the Senate.
As we understand it, the timetable is for the House subcommittees to finish their work this week and have reports ready to go to the big Appropriations committee for a vote as early as Monday night. The full budget will be put on the floor early next week with the goal of final approval by Thursday.
Hear more talk on the budget on this week`s NC SPIN.
Slow down and make better laws
Governor Perdue has been lobbying the legislature to establish a “mobility fund” for transportation projects. Funding for the projects would come from increased fees for licenses and registrations. Not only has the proposal not gotten the legislative support Perdue had hoped for, it actually got unendorsed. Former new car dealer, Representative Nelson Cole (D-Reidsville) had signed on to be a lead co-sponsor of the mobility fund bill in the House. But then he read it and quickly removed his name from sponsorship. Cole admitted that he had signed on too quickly, before he read the bill, blaming his mistake on the rush to pass legislation in this short session. Mark Binker from the Greensboro News-Record reported the story on his Capital Beat blog.
Hey folks, there`s no fire here. Let`s take the time to read the fine print in all this legislation you`re passing. Not only is it embarrassing when we later discover stuff you didn`t know was in the bills but it is actually a bad way to run a state.
Boseman bill puts video poker under lottery
Retiring Senator Julia Boseman (D-New Hanover) has introduced legislation to legalize video poker machines, with licensing and taxation overseen by the North Carolina Education Lottery. The bill anticipates revenues amounting to hundreds of millions of dollars per year.
Polls show GOP gains
Speaking of Boseman, the Democrat who is seeking to replace her, former UNC Wilmington Chancellor Jim Leutze, is trailing the GOP nominee, Thom Goolsby 55-37, according to a Survey USA poll. Democrats are saying this is because Goolsby has more name recognition. Say what? More name recognition than the man who was on UNC-TV for years and served for many years as chancellor of the region`s public university?
Down the road, in Senate District 10, there`s a battle brewing between former DA Dewey Hudson and Brent Jackson, a successful agribusiness leader. Jackson trails the longtime DA 44 to 36. Republicans think they stand a chance to capture this seat long held by Charlie Albertson.
We also heard this week that House Majority Leader Hugh Holliman is trailing his November opponent at this juncture by 8 points.
Senate race counting down
Last week it was former opponent Ken Lewis endorsing Elaine Marshall in the runoff election for the Democratic U.S. Senate nomination. Then Lewis took a job as Marshall`s campaign manager. This week, two of the other primary candidates, Susan Harris of Old Fort and Ann Worthy of Gastonia, threw their support to Cal Cunningham, along with former Senatorial Candidate Jim Neal of Chapel Hill.
Political pundits still tell us they think that Marshall will win the runoff handily but Election Day is 25 days away. Candidates are desperately trying to raise money so they can get on TV the final weeks of the campaign. Cunningham is calling media and about to place buys. So far, nothing from Marshall.
Fetzer: D`Annunzio “unfit for public office”
It isn`t often you see a state political party get involved in a political campaign but it is happening in the crazy 8th Congressional District. GOP Party Chair Tom Fetzer came out with guns blazing this week in an attempt to defeat Tea Party candidate Tim D`Annunzio. The machine gun promoting religious zealot uses unorthodox campaign tactics but he led the vote in the Republican primary on May 4th. The party is officially supporting former sportscaster Harold Johnson in his bid to run against first term Congressman Larry Kissell. Republicans really want to recapture this seat.
Tim, perhaps calling the government the “Antichrist” went a bit over the top. Ya think? Read the story from the News and Observer.
More SBOE investigations
More witnesses are being interrogated over plane flights for Governor Perdue, we are told. We wonder why none of the mainstream media have asked Perdue directly about whether there were additional flights not reported and, if so, what the explanation is for this additional revelation.
There are loud whispers that we will learn more about more contributions to Perdue and Basnight that were reimbursed by another person. The subject of this investigation by the State Board of Elections is a former state senator, we are told.
Where`s the story?
The News and Observer and WTVD-TV have been running front page stories about the liaison Jesse Helms had with the FBI while still a VP at competitor Capitol Broadcasting`s WRAL. I read the story twice to see where the problem was…..and I still can`t see it.
My dad was General Manager of WNCT-TV in Greenville during the late 50`s and early 1960`s. I remember his telling me he had been approached by the FBI and CIA about being “eyes and ears” for suspicious activities. I wouldn`t be the least surprised to find the Daniels family and the N&O had those same approaches. I remember well that when the Bay of Pigs invasion was under way my dad was in Washington for a State Department briefing, which was promptly cancelled and the city went on lock-down.
These were different times. Let`s focus on some real problems. Helms is still a lightning rod to many but there ain`t no story here.
Soles dealing to the end
Even as heis being forced out of office, Senator R.C. Soles is up to his old tricks, introducing legislation that would allow his old buddy and district DA Rex Gore to begin receiving his retirement package earlier than state law currently allows. Gore, you might remember, refused to participate in prosecuting his friend and tossed it to AG Roy Cooper, who didn`t share his reluctance.
A second bill would split the district of the District Attorney in Soles` district, a move which would cost more than a quarter million a year. Soles says it has grown too large for one DA and two are needed. The Charlotte Observer, in a stinging editorial criticizing the bills, says it is to guarantee that Democrats are in control, a move in Soles` best interests. Read the editorial.
By the way, Gore has since asked Soles to drop the legislation. Soles, trying to save some face from this bold attempt at payback partisanship, says he wants to see if any other DA`s might benefit from the legislation. If this bill passes, every legislative Democrat in North Carolina will read and see it on TV before November.
When Time Warner Cable refused to install high-speed Internet service, especially in lower income sections of their city, the City of Wilson took action. Despite protests from Time Warner, Wilson`s leadership wired their city and will reap rewards from citizens having faster Internet access than found in cities like Raleigh but also in getting fees to pay off their investment, similar to municipal utilities like water and electricity.
As you might expect this angered AT&T and Time Warner so they had Senator David Hoyle, in one of his final acts, introduce S1209, cleverly titled “No Nonvoted Local Debt for Competing System.” This measure, clearly supported by the two large companies, would prohibit future cities from installing broadband or any service without having to take it to a vote of their residents.
Do you see the rich irony here? In the same week, our Senators (including Hoyle) proposed incurring $450 million in debt without a vote of the people by considering a bill which refuses to allow local governments to do the same thing. Another example of “do as I say, not as I do.”
Wait a minute. Aren`t the cable franchises granted by the cities? If they can approve a franchise for Time Warner they should be able to grant themselves one also, especially if the cable and/or phone companies are not doing their jobs in a timely manner.
The bill was scheduled for Senate Finance Committee approval this week and we understand the wheels were greased for quick passage…until the NC League of Municipalities and a coalition titled “Broadband for Everyone” pointed out exactly what this bill contained. The bill was pulled without hearing. If Tony Rand was still in the Senate we could have suggested the bill be sent to Senate Rules Committee. Nothing ever saw the light of day after going to Rand`s Rules committee.
More DHHS controversy
After last week`s glowing comments about DHHS and Secretary Lanier Cansler, I caught a fair amount of criticism from bloggers and others. During that interview Cansler told me about appointing John Tote from the Mental Health Association as new head of mental health.
Then the media started reporting the problems with unpaid withholding from Tote`s former employer. Why didn`t Cansler know this, people have rightly asked? All you had to do was Google to find out the story…it wasn`t hidden. We had another interview with Cansler this week. He told me that he knew about the withholding problem but had been led to believe it was a one or two month situation, not something that went on for six years. Clearly this was unacceptable and following our meeting Cansler met with Tote and told him he could not begin work.
Curiously, Tote was angry about the situation, saying nobody`s family should have to go through what his family had been put through. Give us a break, John. DHHS and Lanier Cansler didn`t create your problems. You, as chief executive, and your former employer did. You are not a victim.
Now it`s back to square one to find another leader for mental health. Count on Cansler to go outside the agency again.
In legislative hearings this week, Cansler repeated to lawmakers that in-home services was out of control and that big cuts could be made without endangering services to those who really needed them.
DHHS and especially mental health has huge problems. Perhaps larger problems than can be resolved. Cansler is making changes and we say give him a chance to see if they work.
For more interesting debate on this subject catch this week`s NC SPIN.
Until next week, watch out for the SPIN!
Claire Cox-Woodlief, Editor
Tom Campbell, Publisher
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