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Wed. Late Edition: "Done Deal"?
posted at 2007-07-26 01:53 | Last modified 2007-11-14 10:38
As I posted earlier tonight, House and Senate negotiators say they've come to a tentative agreement on a roughly 20 billion dollar spending plan - pleasantly surprising many of us who fully expected to make it home for dinner.
But when the two sides met at 8 tonight, it was clear from the moment they walked in that things were looking up. People were smiling and joking with each other - a big change from Tuesday night's icy stares (apparently the "MF moment"). By 10:15 tonight, the committee had decided it was generally done. (See below for more on "generally".)
Highlights
It's late, I haven't seen the actual paperwork, and we're all going to be writing about this for three days, so I'm just going to hit the highlights here tonight.
- Medicaid swap? Yes - a three year phase in, starting Jan 08. $86.2M for this fiscal year. In return, the state takes back a half cent of the share (2.5 cents) of the sales tax that now goes to counties. There is a "hold harmless" provision so counties won't lose money on the deal.
- Local option taxes? Yes, and yes. Counties will have the option of letting their voters decide whether to enact a land transfer tax (.02 to .06%), a local sales tax (up to
halfa quarter cent, I think) or neither. - Taxes? Yes and no. The quarter cent that still remains of the temporary sales tax sticks around and becomes permanent. The quarter-percent income surtax on the state's top earners will go away on schedule Jan 1st.
- More at Four: 56M. More than half, 37.5M, is "backfill" to make up some of the substantial difference between what optimistic supporters predicted the lottery would bring in (425M) and its actual receipts (350M). The other 18.5M is to add ten thousand new slots to the preschool program.
- Lottery: wide open. See below.
- UNC Cancer center? Yep, funded in part through the Tobacco Trust Fund and through tax increases on non-cigarette tobacco products (i.e. chew, etc.) 25 million the first year, 50 the second.
- State employee raises: 4 percent for most.
- Land for Tomorrow (preservation): 120M (receipt-funded).
- Water/sewer infrastructure: 100M.
- COPS financing for capital projects: a little over 550 million.
Don't see what you're looking for? The AP's Gary Robertson has a lot more detail here. Greensboro's Mark Binker also has his own rundown.
About that lottery provision...
Easley's budget chief Dan Gerlach asked legislators earlier this year to consider changing the lottery formula to allot more money for prizes. The argument is that the current percentage (35%) for prizes is too low, but higher jackpots will drive up sales.
Ouch. That one could cause some heartburn on both sides of the aisle in both chambers.
Numbers vs letters
The lottery change is a perfect example of how the numbers in a budget are rarely the most interesting part. It's the words - the special provisions - that are the most interesting. Other provisions move money around within departments, earmark funding, change policy, create taxes, etc. Can't wait to see a hard copy to find out what's in the fine print this time.
"Generally" done?
The Finance folks haven't finished their work yet on taxes and revenue. Word is they've agreed on a deal and will finalize it by 11am Thursday. But that means the folks who've been spending money they think they have may need to clean up some numbers before they can sign the bill jacket.
Could it fall apart in Finance? Shoot, anything can fall apart in Finance. But if both Senate Majority Leader Tony Rand and House Senior Budget Chair Mickey Michaux say they've agreed on a deal, then there's probably a deal. Let's just hope they're talking about the same deal.
And then there's "buyer's remorse" to worry about. In the real world, that's feeling sorry you spent money on something. On Jones Street, it usually means feeling sorry you didn't. At the end of tonight's meeting, Michaux warned the committee, "Don't think up anything overnight."
Next step
The finished conference report has to make it past two votes in the House and Senate, and then to the Governor's desk. Theoretically, that shouldn't be a problem - both chambers check back with their caucuses regularly before saying yes or no to major proposals.
This year, though, there's the looming specter of a handful of Senate Democrats who could spook over the transfer tax. And between the lottery changes and new taxes, it's doubtful Basnight can count on much help from even the friendliest Rs.
Still, folks are optimistic. Rand said tonight he thinks the bill "will find favor with everyone that needs to find favor with it." You can hear his comments after tonight's meeting here.
Schedule
If all goes as planned, negotiators will finish the bill tomorrow, run it past the Governor, and then get two copies printed out so they can read it into both chambers late tomorrow. After that, it's a two-day vote, the first currently projected for Friday, and the second shortly after midnight Sat. morning. It's a big if. Stay tuned.
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