RALEIGH, N.C. – A House committee says it doesn’t want t force state employees to take unpaid leave to help narrow future budget gaps because there may be enough volunteers willing to accept the furloughs.

The House Appropriations Committee approved Wednesday a measure detailing how employees can take voluntary furloughs to save money and avoid layoffs.

Committee senior co-chairman Rep. Mickey Michaux says many employees – particularly in the University of North Carolina system – are interested in time off in exchange for lost pay.

This and another furlough bill approved by the committee don’t prevent Gov. Beverly Perdue from ordering furloughs. That happened last week.

Michaux said the Legislature may still have to consider mandatory furloughs for the next budget.

RALEIGH, N.C. – A North Carolina House committee has cleared legislation that would allow people who are illegally denied requests for public documents to get their legal fees paid by the offending government agency.

The House judiciary committee on Thursday unanimously approved a bill that in most cases would eliminate the discretion of judges whether or not to award the legal fees. Government agencies could avoid payouts if they relied on an appeals court ruling or advice from the attorney general’s office that was later overturned.

Lobbyists for two local government associations said their trade groups opposed the measure. They said attorneys working for local governments also ought to be authoritative sources of legal opinions.

WASHINGTON  – A House panel approved legislation Wednesday that would outlaw the kind of “liar loans” and other questionable bank practices that helped drag down the economy.

The proposal, by North Carolina Democratic Reps. Melvin Watt and Brad Miller, is one of several that Democrats are pushing to tighten financial regulations on an industry that underwrote risky loans and passed off the bad debt to investors.

While Democrats cast the bill as a necessary measure that could have helped prevent the financial meltdown, the banking industry and Republicans warned that the would-be rules could restrict the flow of credit.

“Now is not the time to limit choices, raise costs, disrupt the secondary mortgage market, and look the other way on fundamental… reform” of government-created financial services corporations, said Rep. Spencer Bachus of Alabama, the top Republican on the House Financial Services Committee.

Under the Democratic-pushed bill, banks offering other than traditional 30-year, fixed-rate mortgages would have to verify a person’s credit history and income and make a “reasonable and good faith determination” that a loan can be repaid. This provision targets high-risk credit lines that became known as “liar loans” because they required little or no documentation.

Banks also would have to make sure the loan provides a “net tangible benefit” for the consumer.

Another provision would prohibit banks from paying mortgage brokers and loan officers more money if they steer clients toward more costly loan options. Under the bill, a broker would receive the same compensation for selling a 30-year, fixed-rate loan as he would a riskier adjustable-rate mortgage.

The legislation also would place new restrictions on banks wanting to sell nontraditional mortgages to Wall Street by requiring they retain at least some of the risk on their books. Proponents say doing so would further deter banks from lending to people with risky credit.

The panel’s endorsement of the bill, by a 49-21 vote, paves the way for consideration by the full House next week.

WASHINGTON  – Senate Intelligence Committee Chairman Dianne Feinstein says she will investigate indications of new wiretap violations by the National Security Agency.

The Justice Department confirmed Wednesday that it had reined in the NSA’s wiretapping activities in the United States after finding out the agency had improperly accessed American phone calls and e-mails.

Feinstein said the allegations are “serious” and said the Senate Intelligence Committee will hold a hearing within a month.

The Justice Department discovered the problems during a routine review of NSA wiretapping. It says the problems have been corrected.

RALEIGH, N.C. – A North Carolina legislative committee has approved a plan allowing the state’s second- and third-largest metro areas to expand mass transit systems if voters approve raising local sales taxes.

The House Finance Committee voted 19-6 on Wednesday to advance the bill to a House floor vote.

The bill would allow voters in Forsyth, Guilford, Wake, Durham and Orange counties to decide whether to increase local sales taxes by half a cent and car registration fees by up to $2, piggybacking onto Mecklenburg County’s popular experiment with light rail. The state’s 94 other counties could raise sales taxes by a quarter-cent for transit projects.

The committee added a provision allowing Research Triangle Park to increase property taxes on its tenant companies to pay for transit.

RALEIGH, N.C.  – North Carolina and Alcoa Inc. are promising a long fight over control of nearly 40 miles of the Yadkin River where the largest U.S. aluminum producer has operated four electricity-generating dams for more than half a century.

A state Senate committee on Tuesday has approved a plan that creates a holding entity to manage the dams and the water flow through them if North Carolina can wrest control from Alcoa. Alcoa generates millions of dollars a year in electricity sales.

The dams once powered a now-closed aluminum smelter in Stanly County.

Alcoa’s 50-year license on the dams expired last year, and the company wants a new license for another 50 years.

Republican Sen. Fletcher Hartsell of Cabarrus County said the state should control water usage so important to the area’s economy.

RALEIGH, N.C.  – Former top aides to Senate leader Marc Basnight and former Gov. Mike Easley have been named to a new panel designed to recommend ways to rid wasteful spending in North Carolina state government.

Gov. Beverly Perdue on Thursday filled out the remainder of her Budget Reform and Accountability Commission with five additional members.

They include Dan Gerlach, a former Easley budget adviser who now runs the Golden LEAF Foundation, and Norma Houston, once Basnight’s chief of staff.

Other new members are former Glaxo chief executive Charlie Sanders, who was the first chairman of the state lottery commission; IBM executive Curtis Clark; and North Carolina Central University department chairman Ron Penny.

Perdue named Norris Tolson and Hilda Pinnix-Ragland to lead the committee earlier this month.

RALEIGH, N.C.  – A panel of North Carolina lawmakers has approved a measure banning smoking in bars, workplaces and other public locations after deciding police officers should issue citations to smokers who refuse to stub out their butts.

The measure approved by a House judiciary committee on Tuesday had initially said only a local health department official could cite smokers who ignore a request to put out a cigarette. The infraction includes a fine of up to $50.
 
The proprosal still says local health officials are the only people authorized to cite bars, restaurants or other employers who condone indoor smoking. Fine for that offense could reach $200.
 
The committee also decided against giving municipalities the option to make smoking in public places a misdemeanor.

The legislation now heads to the full House.

Cities and towns shouldn’t be allowed to annex unincorporated areas unless targeted residents first are allowed to vote on the matter, a legislative study committee agreed Thursday despite opposition from a powerful lobbying group and state senator.

The special panel examining changes to North Carolina’s municipal annexation laws voted in favor of requiring referenda as a prerequisite for involuntary annexations.

Audience members, many of whom have complained in earlier public hearings that they had little recourse to challenge annexations or get public services in a timely fashion, cheered and clapped after the vote.

“The citizens have no rights in this process,” said Doug Aitken with the Fair Annexation Coalition and a committee member following the 14-6 vote by the panel. “The only right that they have right now is to go to court … The best way for them to have a voice is the right to vote.”

The proposal was one of several endorsed by the divided panel, including a moratorium on new involuntary annexations until these and other changes to the laws are enacted. The changes now go to the full Legislature, which may be less willing to go along with the dramatic proposals.

The North Carolina League of Municipalities, which has many allies at the General Assembly, adamantly opposes referenda, saying the current annexation law approved in 1959 has generally helped cities and towns manage the state’s rapid growth in an orderly fashion.

Municipalities must hold two public meetings, agree to provide emergency and street services to the new citizens and have the money to expand water and sewer mains for hookups. New residents can take sue if promised services don’t arrive on time but they have a small window to do so.

The league has offered 20 changes to the current laws that it says would give citizens more input and time to respond to an annexation proposal. It intends to keep lobbying for them during the session that begins next week, league lobbyist Kelli Kukura said.

“This bill ultimately comes down to a fairness issue between in-town residents and near-town residents,” Kukura said. “There are some select concerns in certain communities across the state, and our 20-point proposal has addressed those.” Senate Majority Leader Tony Rand, D-Cumberland, said he doesn’t want to see a referendum procedure approved by the Legislature. He said few annexations would be successful because few people want to vote upon themselves additional municipal taxes.

“It materially damages urban areas,” said Rand, who is also chairman of the powerful Senate Rules Committee. “The cities wouldn’t grow.”

At least 28 of the 43 states that have annexation statutes require some kind of election, according to a 2002 University of Georgia study. Although panelists at Thursday’s meeting were split about equally between legislators and non-legislators, there was support from both chambers, said Rep. Nelson Dollar, R-Wake, a committee member.

“It’s a fundamental issue when government is set to do something with your home and you realize you have no say in the process,” Dollar said.

The House approved a nine-month moratorium last summer. The Senate didn’t go along with it but agreed to study annexations issues with the House in advance of the new session.

The panel also agreed in principal Thursday to proposals that would:

- direct the state’s Local Government Commission to oversee annexations to ensure cities and towns are fiscally able to provide services.

- give new residents up to five years to pay assessments for water and sewer services to reach their property.

- make it easier for areas where many low-income families live to petition a local government requesting that they be annexed.

- raise development density standards before a municipality can begin the annexation process.