Morning Memo: Budget bill may prove test of McCrory influence

Posted by John Frank on May 29, 2014 

Read outside the lines of the Senate’s state budget plan and a familiar question from a year ago is beginning to emerge: Does Gov. Pat McCrory have any influence?

The Senate’s budget plan takes a drastically different approach to paying teachers more money than what the Republican chief executive proposed. McCrory’s spokesman said the governor had “a different and broader approach.” (More on that below.)

Democratic blogger and strategist Thomas Mills suggested “the big loser in the plan is the governor. McCrory obviously got left out of the process again. Remember, a couple of weeks ago he rolled out his own pay plan that was really too little, too late. And he was on a podium by himself. The leaders of the Senate and House were no where to be seen. ...

“The episode is emblematic of how the senate views McCrory.” ( Read more here.)

In his first legislative session, McCrory came across as a bystander to the process as the legislature – particularly the state Senate – emerged as the driving force of the GOP agenda. The dynamic recently received national attention.

But this session, the governor suggested he would take a stronger approach.

His administration has worked with lawmakers on the fracking bill but McCrory still has concerns about a key provision that usurps local authority. And the tax bill remains an unknown. McCrory has remained uncommitted on the legislation, but his record as Charlotte mayor protecting – and increasing – the city’s privilege taxes stands as a contrast to the legislation’s direction.

The next test may be coal ash. The House and Senate introduced McCrory’s plan. But Rep. Chuck McGrady, who is leading the House effort to design new regulations, said it is merely a place holder for now. The two chambers are meeting in private to formulate their own plan.

It’s too early to write off McCrory. The House has appeared more cozy with the governor, so he may be able to influence lawmaking on that side. But the question that plagued him last year is beginning to form again.

***Get much more on the Senate’s budget plan and McCrory’s reaction – along with a look at the split on the fracking bill – below in the Dome Morning Memo. ***

TODAY IN POLTICS: Gov. Pat McCrory will attend a 10 a.m. meeting of his statewide driving-while-impaired task force in Raleigh and later attend the Randolph County Lincoln Day dinner in Asheboro, according to his calendar.

The Senate budget committee started first thing at 8:30 a.m. Two more Senate committees will look at the proposal today and send it to the full chamber, which is in recess for the time being.

The Senate Finance Committee also will hear a bill to clarify the Read to Achieve initiative at 1 p.m. in 544 LOB.

The House Government Committee will meet at 10 a.m. in 1228 LB to hear a long list of local measures. The House Environment Committee meets at the same time in 544 LOB. A House military panel will meet at noon in 421 LOB.

A rally against fracking will take place at the General Assembly at 12:15 p.m. ahead of the House’s 1 p.m. session, where lawmakers will take a final vote on the legislation.

#NCSEN --- The headlines from the U.S. Senate campaign trail.

IN CASE YOU MISSED IT: Kay Hagan shifts off fence, calls for VA secretary’s resignation. Read more here.

TILLIS SUPPORTS FRACKING: A day after Democratic U.S. Sen. Kay Hagan objected to the fracking bill making its way through the state legislature, her Republican rival Thom Tillis voted to support it.

It’s rare for Tillis to take votes on legislation as House speaker but he said he wanted “to make it very clear where I stood on the issue.”

Hagan, a former 10-year state senator seeking her second term in the U.S. Senate, said she supports fracking but believes the chemicals used in the process need to be public. She objected to a provision in the fracking legislation that makes it a misdemeanor to disclose the chemical mix.

Tillis said he is comfortable with the disclosure rules proposed. “The materials data sheet and other information that will be available to early responders in medical situations address the concerns around the disclosure of the information,” he said.

“With innovation we are talking about future chemicals ... in the not-to-distant future that are safe, they are saying even food grade,” Tillis added. “Hopefully this addresses the short term concern, long term I think it will be a non-issue.”

Tillis also defended the change in law that will no longer require the General Assembly to approve the rules, as Republican lawmakers had promised. Tillis said lawmakers can still object through what is know as disapproval bills — but such measures are unlikely to win support in both chambers.

He said the about face was needed to give the industry more certainty. “We need to get the industry interested in the research and the necessary steps to really determine the extent to which this is a viable industry in North Carolina,” he said. “What we are trying to do is provide certainty to the industry so that we are likely to see that kind of investment and ultimately the job creation that comes from it.”

As for the speed at which the bill is moving this session, Tillis said: “I think it’s just a matter of why not get it done. It’s time to move forward.”

HAGAN GETS FINANCIAL HELP: Vice President Joe Biden will raise money in San Francisco to benefit Kay Hagan. Read more here. And Hagan may run more fundraising committees than anyone on Capitol Hill. Read more here.

MORE HEADLINES – NYT: Michigan increases its minimum wage, complicated in N.C. Read more here. Washington Post: The coming political explosion over climate change. Read more here. The Hill: Did Democrats wait too long to call for Shinseki’s head? Read more here. NYT: Democrats, to Counter G.O.P., Turn Their Focus to Local Issues for Midterms. Read more here.

#NCGA --- A roundup of news from the N.C. General Assembly.

SENATE UNVEILS ITS BUDGET – 3 THINGS TO KNOW:

1. WRITTEN BEHIND CLOSED DOORS, RUSHED THROUGH THE PROCESS: Crafted for weeks behind closed doors, the Senate budget was released late Wednesday and is expected to pass through the chamber by Friday or Saturday. The Senate’s budget committee met hours later at 8:30 a.m. and the appropriations subcommittees aren’t meeting to dissect different parts of the bill, as is often the process.

2. BIG TEACHER PAY HIKES, BUT AT A COST: The state Senate’s proposed $21.2 billion budget makes cuts throughout state agencies while funding a big teacher pay increase and raises for state employees.

State funds for teaching assistants will be cut nearly in half, by $233.1 million, in the year beginning July 1. The state will fund teaching assistants for kindergarten and first-grade classes only. Teaching assistants, who are used in kindergarten through third grade, have been continuously pared in recent years.

3. DEMOCRATIC OFFICIALS TAKE BRUNT OF CUTS: The budget proposes to cut the state Department of Public Instruction by 30 percent, or $15 million. It is run by Democratic State Superintendent June Atkinson.

The Department of Justice, run by Democratic Attorney General Roy Cooper, would take a bigger hit.

According to a budget outline released after 8 p.m. Wednesday, the state Justice Department would be cut by more than half, from $82.3 million to $34 million, with 638 jobs lost. Some of those positions would move to the Department of Public Safety, because the Senate has proposed transferring the State Bureau of Investigation to Public Safety, something it tried to do last year. The budget also moves the State Crime Lab to Public Safety.

Read much more on the budget proposal here.

FRACKING FAST-TRACK CONTINUES – HOUSE SPLITS ALONG PARTY LINES IN VOTE: The state could begin issuing permits to allow fracking for natural gas in North Carolina by this time next year.

With a vote of 63-52, House lawmakers gave preliminary approval Wednesday to a Senate bill that fast tracks fracking, ignoring complaints by Democrats that the bill was being rushed through with too little public notice and study. ...

Fracking opponents saw it differently, charging that lawmakers reneged on promises to allow no drilling permits until rules that are still in development are in place. If the bill passes, they say, those rules could take effect with no further action by the legislature. Read more here.

INSIDE THE VOTE: A dozen Republicans bucked their party on the vote. A prominent one didn’t vote (Ruth Samuelson). And one Democrat, Rep. William Brisson, supported the measure. Brisson has frequently sided with Republicans on major legislation.

OVERHEARD: Look for some shifts in the House’s final vote on fracking today.

STORY TO WATCH — TWO PIPELINES IN WORKS TO BRING SHALE GAS TO NORTH CAROLINA: Dominion Transmission is looking at building ... the Southeast Reliability Pipeline Project. ... The planned pipeline would bring gas from the Marcellus and Utica shales to North Carolina, according to (a company representative). North Carolina has historically relied on natural gas from the Gulf Coast, he said. “We’re at the beginning stages of determining what it’s going to take to get gas to North Carolina,” Robert Orndorff said. Read more here.

ALSO: Spectra Energy is in the preliminary stages of building a 427-mile, 36-inch diameter natural gas pipeline, with capacity of up to 1.1 Bcf/d, that would run from the heart of the Marcellus Shale to North Carolina.

No final name has been set for the project, now dubbed Spectra Carolina, which is tentatively set for service in late 2018, spokesman Arthur Diestel told NGI’s Shale Daily. ... The proposed pipe would begin at subsidiary Texas Eastern Transmission LLC compressor station 220 in Bedford County, Penn. Based on a natural gas pipeline study of the corridors, the pipe would extend into Maryland, Virginia and West Virginia before terminating in North Carolina. Read more here.

SIDE NOTE: Gov. Pat McCrory listed on his financial disclosure form more than $10,000 in Spectra stock. The company spun off from Duke Energy in 2007.

IN MOVE TO CUT BUSINESS TAXES, LAWMAKERS SET UP A FISCAL CLIFF: To lower local taxes on businesses, state lawmakers may force cities and towns onto a $62 million fiscal cliff.

The state Senate on Wednesday voted 37-9 to give preliminary approval to a wide-ranging tax bill that includes a provision to revoke the authority of municipalities to levy privilege taxes on businesses beginning July 1, 2015.

It’s a significant step further than the version approved by House lawmakers last week. Their version capped privilege taxes at $100, but House members are expected to agree to the Senate’s changes. ...

“The only tool we have to make that up is to increase property taxes,” said Raleigh Mayor Nancy McFarlane. “So the bottom line is that the General Assembly is saying that businesses don’t have to pay, but people have to pay more.” Read more here.

IN NEW STSRATEGY, POLICE HOPED TO AVOID ARRESTS: Lt. Martin Brock of the General Assembly police force said Wednesday that the department had wanted to employ a different approach for dealing with protesters this legislative session. “Our hope was to prevent arrest,” he said.

But in the early hours of Wednesday morning, 14 people were arrested after refusing to leave the office suite of House Speaker Thom Tillis. Read more here.

A DIFFERENT PROTEST – A DIFFERENT RESULT: A day after the sit-in began, House Speaker Thom Tillis allowed a different kind of protest to take place even though it violated the rules.

A group of 50 students from Carrboro lined the House balcony holding signs that said “I don’t want my teacher to move to (state name).” It came after Houston’s school district advertised a job fair for North Carolina teachers, touting a higher starting wage.

Tillis took a moment at the end of session Wednesday to tell them that the big signs violated the rules but he was glad to see students being active in the process. “We appreciate you trying to advocate for teachers. We are trying to do our best as well,” Tillis said. The House members rose to give the students an ovation.

#NCPOL – More political news from North Carolina.

TWEET DU JOUR: Washington Post’s Paul Kane (@pkcapitol): House voted 379-1 on resolution asking China to respect religious freedom/human rights. Lone nay? Walter Jones (R). More here.

QUICK LOOK – More headlines from across the state.

Bob Orr to step down as interim DA next week. Read more here.

House gives final approval to Allen nomination. Read more here.

Jennifer Roberts will seek Charlotte mayor’s post next year. Read more here.

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