RALEIGH, N.C.  – North Carolina state government has at least $620 million at its disposal so far to close any budget hole this fiscal year.

State budget director Charlie Perusse (pur-ROOS’) and the General Assembly’s top economist gave legislative leaders Wednesday an update on the state’s financial picture through October.

Perusse’s office estimates it will have $469 million from unused funds and holdbacks of up to 5 percent from state agencies ordered by Gov. Beverly Perdue to ensure there’s money to pay bills.

There’s another $150 million in the rainy-day reserve fund.

So far, revenues are $95 million less than what lawmakers projected when they passed the $19 billion budget in August. That shortfall is nowhere near the $3.2 billion shortfall Perdue faced last year.

RALEIGH, N.C. – Gov. Beverly Perdue hasn’t had to use up all of North Carolina’s “rainy-day” funds to manage the state’s fiscal storm.

Perdue’s office said Tuesday there’s still $150 million left over from the $787 million Perdue took from the savings reserve account in March. The extra money means the state has some cash to respond to a hurricane or other disaster.

Perdue took the money to ensure the state could pay its bills because of dwindling tax collections. There was no guarantee any money would be left over.

The State Controller’s Office released a report late last week finalizing numbers for the fiscal year ending June 30. It says tax revenues dropped 10.9 percent, or more than $2 billion, compared to the previous year.

RALEIGH, NC – In spite of House Speaker Joe Hackney’s (D-Orange) bold statement that “there is no pork in this budget,” the Civitas Institute has identified nearly $300 million in questionable appropriations for the fiscal year 2009-10 state budget.

In the midst of a recession and one of the largest budget deficits in state history, lawmakers adopted $1.1 billion in new taxes in order to help balance the budget. Indeed, Hackney declared that, in part, the new taxes “saved public education and its core mission in North Carolina.”

But what else are state leaders “saving”? While higher taxes will inevitably lead to lost jobs, a closer look at the final state budget reveals that the state continues to waste millions of taxpayer dollars for animals, plants, public television, walking trails, tourist attractions and corporate welfare.

A review of budget spending that was not cut during this year’s “budget crisis” should call into question the priorities of Raleigh politicians. Included in the recently-approved spending package is:

·         $1.1 million for the executive aircraft division

·         $10 million to subsidize in-state tuition for out-of-state scholarship athletes

·         $2.9 million for the North Carolina symphony

·         $11.1 million for “tourism, film and sport development”

·         $9.4 million for marine fisheries research

·         $4.7 million for a “special zoo fund,” a “grassroots initiative” sponsored by the Department of Environment and Natural Resources, and the “adopt-a-trail” program

·         $8.6 million for the NC Arts Council

·         $1.1 million for the botanical garden at UNC-Chapel Hill

·         $252,000 for the “cemetery commission”

·         $563,000 for the Ergonomics Center at N.C. State

Asks Civitas Institute policy analyst Brian Balfour, “Is it really necessary to destroy private sector jobs via tax hikes in order to finance more than $40 million on museums, art councils and symphonies? In this ‘deepest recession since the great depression,’ is it appropriate for the state to spend $14 million on state-run television and more than a million dollars for state government planes?”

The Civitas Institute’s full list of questionable spending priorities can be found here.

“A little investigation makes it readily apparent that Raleigh lawmakers are more concerned about a budget that protects frivolous ‘wants’ and new, unproven programs than protecting the jobs of its citizens,” concludes Balfour.

The state of North Carolina owes a big apology, and a good bit of cash, to crime victims who have been denied their legal restitution by government incompetence.

An analysis of almost a quarter-million cases where the courts ordered restitution to crime victims shows that about one-third of the victims did not receive the money due to them. McClatchy Newspapers conducted the analysis.

State law says that crime victims stand first in line when a criminal makes restitution payments. But somehow officials at the N.C. Administrative Office of the Courts put them third. Then someone at AOC improperly programmed the agency’s antiquated computer system, and the victims ended up sixth in line.
This clearly was not what legislators had in mind when, in 1998, they changed state law to put victims first.

So, now it is time to set things right.

Whether the state will be able to do that is still to be determined, however.

That’s because AOC’s computers, which date back to the 1980s, are incapable of re-computing the cases according to the proper schedule. For years, AOC and the entire judicial branch of government have been begging the General Assembly for adequate funds to modernize its computers. The money has been slow in coming. This is just one of many bungled jobs North Carolinians might expect of their courts if the computers aren’t replaced some time soon.

It’s pretty clear that many North Carolinians are still awaiting money they deserve. The newspapers determined that of the 250,000 cases reviewed, more than 80,000 still have not been paid in full. But in those 80,000 cases, the state collected some $8.5 million in restitution and sent it to agencies that had a lower priority on the legal scale.

AOC has ordered the computers re-programmed to abide by the law in the future. But AOC leaders say they can’t mash a key and produce a list of who has been denied their rightful restitution and how much that would be. The computers can’t do that. Individual crime victims owed money will have to petition the clerk of court in the county of the original conviction to determine if they are owed money.

North Carolina owes the crime victims a speedy reconciliation of their accounts. The victims should not only be paid the principal they are owed but also interest on that money since the day it was due to be paid to them.

When the state sends the checks, apology notes should be included, too.

RALEIGH, N.C.  – A legislative office that examines state agencies says North Carolina could have saved up to $226 million on if regulators had acted more quickly to contain mental health costs.

The report released Monday by the General Assembly’s Program Evaluation Division examined what’s called the Enhanced Services Package. The most expensive part was “community support” services, which pays for non-medical care for patients living at home.

The division said that total costs began to soar beginning in October 2006, but agency decisions to control costs didn’t occur until five months later.

Health and Human Services Secretary Lanier Cansler wrote a response to the report. He said there are federal and state rules and regulations that make it difficult for his agency to rein in costs.

WASHINGTON – John Edwards’ mistress received $100,000 from his political action committee in an 18-week span in 2006, payments that raise this question: Can politicians use PACs as their own personal piggy banks?

From staging fundraisers in Las Vegas to financing ski trips, current and former lawmakers have spent PAC money on a broad range of seemingly personal activities over the years, all the while maintaining they are doing so for strictly political purposes.

In the wake of the disclosure of Edwards’ affair with videographer Rielle Hunter, Edwards has acknowledged a federal criminal investigation is under way into his presidential campaign fund.

But it was the former senator’s PAC – which is separate from the campaign – that paid $114,000 in 2006 and early 2007 to Hunter’s Midline Groove Productions. Hunter shot videos of Edwards as he spread the populist message he subsequently would adopt in his presidential campaign.

PACs like Edwards’ One America Committee have legal flexibility that campaign committees do not.

It is illegal under federal election law to convert campaign funds to personal use. But that prohibition doesn’t extend to PACs in most cases, according to the Federal Election Commission, which in March asked Congress to tighten the law.

The FEC “has seen a substantial number of instances where individuals with access to the funds received by political committees have used such funds to make unauthorized disbursements to pay for their own personal expenses,” the FEC said in its legislative recommendation to Congress.

Leadership PACs are “a form of giant slush fund; they should be banned,” said Fred Wertheimer, president of Democracy 21, a campaign money watchdog group.

Their political purpose enables PACs to receive tax-exempt status.

“If a politician uses a PAC as a piggy bank for personal expenses he better make sure to accurately disclose the payments on FEC forms and pay taxes on the income,” says Jan Baran, a top campaign finance lawyer in Washington and a partner at Wiley Rein LLP.

Edwards could face a number of issues in the criminal investigation, whose existence he confirmed on May 3.

Was the purpose of the PAC money to Hunter to pay for a handful of online videos on Edwards’ travels? That would seem to be the case based on the PAC’s reports to the FEC. The money to Hunter’s production company was for “Website/Internet Services,” the reports state.

But if the money were for some other purpose, that could amount to a criminal act by those who caused incorrect information to be filed with the FEC.

Another issue surrounds the final $14,000 PAC payment to Hunter on April 1, 2007, from One America, which didn’t have enough money on hand at the start of the day to make the payment, according to records filed with the FEC.

The Edwards presidential campaign injected $14,034.61 into the PAC that day for a “furniture purchase,” the records state. That put enough money in the political action committee account to pay Hunter $14,086.50 the same day.

The Edwards camp has said the money from the PAC was exchanged for 100 hours of unused videotape Hunter shot.

It could be a criminal act if the real purpose was something else, such as an effort to keep the videographer quiet about the affair.

When Edwards disclosed the existence of the criminal investigation early this month, he said in a statement that he was “confident that no funds from my campaign were used improperly.”

This week, Elizabeth Edwards seconded her husband’s assertion, saying that “it’s just not possible” that campaign funds were paid to Hunter.

“The way campaign funds are distributed is all a matter of record,” Elizabeth Edwards said on NBC’s “Today.”

The Justice Department prosecutes the personal use of campaign funds.

Among high-profile politicians who have gotten into legal trouble over personal use of campaign funds are former House Ways and Means Chairman Dan Rostenkowski, D-Ill., and former Rep. James Traficant, D-Ohio. Rostenkowski ultimately pleaded guilty to mail fraud; Traficant was convicted of taking bribes and kickbacks from businessmen and his own staff.

More recently, a former congressional candidate in Kansas pleaded guilty to misusing campaign funds to cover a check for the down payment on a home.

In her new book, Elizabeth Edwards describes her understanding of the first meeting between her husband and Hunter, writing that Hunter greeted Edwards with the come-on line, “You are so hot,” after waiting for him outside a New York hotel.

That was followed within months by Edwards going on the road, with Hunter accompanying him to key primary states. One America paid the videographer $100,000 from July to November 2006, seven weeks before Edwards declared his candidacy.

 Winston-Salem Journal

The $22 million spent lobbying state officials in 2007 most likely shocks many North Carolinians. But there is good news hidden in that figure because it is probably much more accurate than any number we’ve seen in the past.

Democracy North Carolina, a non-profit state-government watchdog group, compiled the number and says it is $5 million higher than that for 2005, the previous long session of the General Assembly.

The $5 million increase may be deceptive because recent changes to state law mean North Carolinians are getting a better view of what lobbying really costs. It is entirely possible, for example, that total lobbying costs went down between 2005 and 2007.

Before the passage of lobbying reform legislation several years ago, lobbyists spent generously on legislators and other state officials and never reported a dime of it. A lobbyist might pay for a meal at a fancy restaurant but not report that expense. That was perfectly legal because of something called the goodwill lobbying loophole.

Legislators closed that loophole and banned most of the wining, dining and gift-giving that had made up such a big portion of lobbying in previous years.

Democracy North Carolina also noted that many people who may not have been legally considered lobbyists in 2005 went ahead and registered as such in 2007. That’s because the new law is so much stricter. People didn’t want to take a chance.

So, reported lobbying costs in the past were always grossly understated while, with the 2007 reports, they may be slightly overstated.

Though the word “lobbying” has a negative connotation, the actual profession can be one of considerable usefulness to the public and one practiced ethically. Most business associations, including some to which the Journal belongs, lobby the legislature and other government agencies. Lobbying is how many businesses, social organizations, churches and citizen groups exercise their First Amendment rights to “petition their government for a redress of grievances,” or, at the very least, to try to get their share of the budget.

Lobbyists provide government officials with a wealth of information and they provide a wide perspective on the ramifications of government policies and proposals. In that way they help all North Carolinians.
Most lobbyists consider their work to be an honorable pursuit. They work hard and many are well paid.

With the lobbying reforms of the past decade, it is more likely that lobbying is being conducted on a higher plane. Considering the state’s recent past, that’s good for everyone.

WASHINGTON  – A North Carolina senator who’s co-sponsoring legislation on cigarette advertising has received $355,000 from tobacco groups and employees, election records show.

The Charlotte Observer reported Sunday that the contributions to GOP Sen. Richard Burr’s campaign since his election to Congress in 1995 are second only to Senate Republican Leader Mitch McConnell of Kentucky, another tobacco-producing state. The Center for Responsive Politics says McConnell has accepted $390,000.

Burr and Democratic North Carolina Sen. Kay Hagan of North Carolina have joined to sponsor a measure that would ban advertising in magazines and newspapers and prohibit certain words from being used to describe tobacco products.

They hope to sway Congress to not pass a measure that would be even tougher on the tobacco industry.

Burr’s top overall contributor is R.J. Reynolds Tobacco and its parent company with $194,000. The company, which is the nation’s No. 2 tobacco company, is based in the senator’s hometown of Winston-Salem.

“Senator Burr has represented the state for a long time, either in the Senate or the House, and I think through that long representation he has done an excellent job of being receptive to business issues of all types,” said Maura Payne, a spokeswoman for Reynolds American. “Given that receptivity, we have supported his campaigns.”

WASHINGTON  – The Democratic National Committee raised $3.2 million in February, a strikingly low take for a financial juggernaut led by President Barack Obama and his legions of grass-roots supporters who helped him shatter campaign fundraising records.

Even the committee’s Republican counterpart raised more – $5.1 million – last month and did so under more difficult circumstances. The GOP was coming off of a disastrous election in which it lost the White House and saw its numbers in Congress shrink further. New GOP chairman Michael Steele also had a rocky start.

Overall, monthly reports being filed Friday with the Federal Election Commission show the Republican National Committee in healthier shape than the Democrats as both parties start raising money for special congressional elections and governor’s races in Virginia and New Jersey this year, as well as congressional elections in 2010.

The DNC reported $8.6 million on hand and $7 million in debt, while the RNC reported $24 million in the bank and no debt.

Democrats are hardly broke. They still have an energized base of donors led by Obama, who ended 2008 with some $18 million in his presidential campaign account. He transferred $2 million to the DNC in February. House Speaker Nancy Pelosi, D-Calif., also is a fundraising draw.

Democrats attributed the small February collection to several factors.

Obama has yet to take part in any major fundraiser; his first event for the DNC is set for Wednesday in Washington. Democrats have been mindful of the potential backlash if the president diverts attention from trying to solve the nation’s economic woes for campaign activities.

The party also says it has not aggressively used Obama’s 13-million strong e-mail list to raise money. Rather, the list has been tapped primarily for organizational purposes. Still, Democrats were raising at least some money through the Internet, sending out appeals that tagged conservative talk show host Rush Limbaugh as the new leader of the GOP.

At the same time, the DNC’s new chairman, Tim Kaine, remains Virginia’s governor and is essentially a part-time party chairman until his term ends later this year.

A $3.7 billion budget shortfall kept Kaine all but tied to Richmond until the state legislative session ended Feb. 28. While the legislature was in session, a state law prohibited Kaine from raising money for his own political action committee or the state leadership committee he runs although he could help with cash for the party.

By comparison, in February 2005, after George W. Bush won re-election and with Republicans controlling Congress, the RNC raised $12.5 million under new chairman Ken Mehlman.

The DNC raised $6.5 million during that period when its party was out of power at both ends of Pennsylvania Ave. That included a $1 million transfer from failed presidential candidate John Kerry.