Under the Dome

January 16, 2014

Morning Memo: The politics of the president’s visit

President Barack Obama’s trip to North Carolina carried an apolitical theme in talking manufacturing but the visit was full of politics on the sidelines.

President Barack Obama previewed themes from his State of the Union address in his North Carolina visit, declaring this year "a year of action" and pushing for better (and more) middle class jobs.

It appeared largely apolitical. Gov. Pat McCrory and his commerce secretary Sharon Decker sat in the front row at the speech; McCrory even warmly welcomed Obama at the airport.

But the politics didn't sit entirely on the sideline. Obama at one point suggested state leaders were doing their part to create good jobs, but then urged Republicans to embrace an extension in federal unemployment benefits -- in the only state in the nation penalized by the federal government for curtailing them in 2013.

Republican U.S. Rep. Renee Ellmers suggested Obama was taking credit for the state's improving economy when he had no part in improving it. And she took issue with the notion that he will stretch his executive powers to push his economic agenda.

Then, of course, much attention focused on Kay Hagan’s absence leading up to the event. And Republicans jumped on the issue once again Wednesday when Obama gave Hagan a shout out in his speech.

At the state level, McCrory is seeking $10 million in state money to put toward the new institute at N.C. State University -- one supported not only by Obama but Democratic Sen. Kay Hagan -- and it's unclear whether lawmakers are on board.

And the icing on the political cake: Democratic U.S. Rep. Mike McIntyre riding on Air Force One. McIntyre couldn't run further from Obama if he tried in his last election, and there he was flying on the plane and working the crowd at N.C. State.

***It's a lot to take in -- but find links to all the coverage below in today's Dome Morning Memo.***

The speech. Read more here. The institute. Read more here.

The president's visit. See the video here. Up close with Air Force One. See the video here.

The quotes. Read them here. The political sideshow. Read more here.

A photo gallery. See it here. Full text of speech. Read it here.

TODAY IN POLITICS: Gov. Pat McCrory will attend the N.C. Sweet Potato Commission annual meeting at 9 a.m. in Wilson and then host a roundtable discussion with community and business leaders at 10:30 a.m. at Quince Bistro. Later at 6 p.m., he will attend the grand opening of the Searstone Retirement Community in Cary.

South Carolina Attorney General Alan Wilson will speak at noon in Raleigh during a local Federalist Society luncheon at The Cardinal Club. Wilson will discuss the role of state attorneys general in enforcing limits on federal power.

A legislative oversight committee on emergency management meets 9:30 a.m. at 544 legislative office building and a joint oversight committee on justice and public safety meets at 1 p.m. in room 643.

CONGRESS PASSES BUDGET: A $1.1 trillion spending bill for operating the government until just before next fall's election steamed through the battle-weary House on Wednesday over tepid protests from tea party conservatives, driven by a bipartisan desire to restore painful cuts in domestic and defense programs and show disaffected voters that Congress can do its job.

The bill swept through the House on a 359-67 vote and was on track for a big Senate vote by week's end. Republicans voted for the bill by a 2 1/2-1 margin, and just three Democrats were opposed. Read more here.

#NCPOL ---

N.C. LOBBYIST HOSTS FUNDRAISER FOR NIKKI HALEY: South Carolina Gov. Nikki Haley is getting a campaign boost from North Carolina lobbyist Theresa Kostrzewa.

Kostrzewa – whose Raleigh home is known as “party central for all the fundraisers she hosts – told Dome she met Haley a year ago at a Republican Governors Association event. “I really liked her,” she said.

The top donor level for the Feb. 3 event is $3,500 with tickets for a couple at $1,000. Kostrzewa represents Amazon, Anheuser-Busch, Fox Entertainment, GEICO and 20-some other clients in the 2013 legislative session.

Haley is no stranger to North Carolina political money. She held a June fundraiser in Greensboro in coordination with an event hosted by Gov. Pat McCrory's political nonprofit.

The campaign of her Democratic opponent, Vincent Sheheen, also has North Carolina connections: it is managed by Andrew Whalen, the well-known N.C. Democratic operative.

GOOLSBY ENDORSES LEE TO REPLACE HIM: From WWAY -- Five days after Thom Goolsby shocked many in the GOP by announcing he will not seek reelection a man he once defeated will run to replace him. Wilmington lawyer Michael Lee says he will run again for the seat. Read more here.

TOM MURRY GETS PAC NOD: From the Insider -- Rep. Tom Murry, R-Wake, is among 20 legislative officeholders from around the country who have been named to GOPAC's Legislative Leaders Advisory Board.

GOPAC has been prominent in helping Republican local and state officials develop political skills, with an eye toward them running for higher office. The group was formed in 1978 by 13 Republican governors, but was associated in the 1990s with former U.S. House Speaker Newt Gingrich. He cuts ties to the group in 1995 as questions arose about whether his campaign had improperly benefited from the organization.

THE NEW CONSERVATIVE SPIN ON ‘TAX REFORM:’ It’s all how you count, is the takeaway from this new John Locke Foundation report -- “Taxpayers in every income category will save tens of millions of dollars because of state tax reforms enacted in North Carolina in 2013. Combining 2013 reforms with a 2011 sales-tax cut pushed by the Republican-led General Assembly, lower- and middle-income households will enjoy annual savings of $682 million, according to a new John Locke Foundation Spotlight report.” Read more here.

#NCSEN ---

SUPERPAC FORMS TO HELP HAGAN: Even as Kay Hagan blasts outside interests for attacking her, outside interests are organizing to help her.

From Bloomberg News -- Sen. Kay Hagan, a North Carolina Democrat facing a difficult re-election campaign in November, is getting outside help from a super-political action committee that can accept contributions in unlimited amounts.

Wolfheel PAC is exclusively “focused on making sure that Kay stays in the U.S. Senate,” Ben Chao, a Democratic strategist involved with the pro-Hagan super-PAC, told Political Capital. The PAC filed organizing papers last week with the Federal Election Commission, which processed the documents Jan. 13.

North Carolina is “probably going to be about as central to the fight to hang on to the Senate as you can get,” Chao said. Read more here.

TILLIS IN NEW YORK TIMES -- Under the headline “After Flurry of Changes, Some States Ease Up:” Republicans in North Carolina were besieged with weekly protests over their agenda. The state is in an abbreviated second year of its two-year legislative session and for that reason, Republican leaders say, it is unlikely that they will tackle more potentially divisive measures. (One of the top main priorities this year will be something more identified with the Democratic Party: increasing teacher pay.)

“Heavy-lift items come in the first half of the session,” said Representative Thom Tillis, the speaker of the North Carolina General Assembly. “As a practical matter, I want the session to be the shortest it can be.” Read more here.

#NCGOV ---

THE BIG STORY -- STATE SPENDS $85 MILLION THEN CANCELS CONTRACT: State officials have agreed to pull the plug after spending $85 million on a tax computer system project that was supposed to handle the processing of tax forms and other tax information for years ahead.

A contract between the state and the CGI Group was canceled Friday.

The state and CGI “mutually agreed” to a final $5 million payment for unbilled work not yet paid and that will close out the contract, according to Trevor Johnson, a Revenue Department spokesman.

CGI had previously received $63.8 million for its work on the tax software project, which had been handling some aspects of the state’s tax processing but not the major ones. The state had spent about another $22 million on hardware, maintenance and other services related to the contract.

But the major part of the system – to be used for processing tax returns – had been delayed. State revenue and information technology officials said the project hadn’t worked and they made a “tough call” to halt more work on the system. Read more here.

PROVIDERS QUESTION MANAGED CARE: State hospitals, doctors and pharmacies united Wednesday in support of Medicaid changes that stop short of full managed care but would reward them for quality, cost-conscious care.

An advisory committee on state Medicaid changes heard from nearly 50 speakers Wednesday as it gathered more information on potential changes to the government health insurance program for low-income children and their parents, the elderly and disabled.

Gov. Pat McCrory’s administration wants to control Medicaid spending with a switch to managed care. Medicaid spending has dented the budget in recent years. Some of the overruns were due to inaccurate budget forecasts. Under managed care, providers would be given a set amount to treat patients and would be responsible for costs if they overspend. Read more here.

RACIAL JUSTICE ACT CASES GET BOOST: The four North Carolina prison inmates whose death sentences were commuted to life in prison without possibility for parole under the short-lived Racial Justice Act received support this week from former judicial heavyweights.

As the inmates wait for their cases to be scheduled for arguments in the N.C. Supreme Court, two retired chief justices of the state's highest court, one retired associate justice and three retired Superior Court judges filed a brief urging the state justices to consider “the critical importance” of the North Carolina law that was the only one of its kind in the country. Read more here.


Pat McCrory on MSNBC Wednesday. See it here.

State officials encouraged destruction of old records. Read more here.

Abortion rights activists plan 2014 offensive, notes North Carolina. Read more here.

N.C. lawyers watching other gay marriage cases. Read more here.

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