State budget unfolds in secret

Raleigh News & Observer
Doors are closed as top leaders deal

Lobbyists for schools, colleges and teachers line up outside state Rep. Doug Yongue’s door nearly every day because he shepherds education spending in the state House budget. But even he is locked out of the negotiations between House and Senate budget writers as they try to reach agreement on a $17 billion spending plan that is now a month late.

"I don’t particularly like it," Yongue, a Scotland County Democrat, said of the way the legislature puts together a budget. "I think we ought to be involved the whole way through. But that’s just the way the system works."

That system for putting budgets together involves a handful of powerful lawmakers meeting behind closed doors on the sixth floor of the Legislative Office Building. They take their cues from House Speaker Jim Black, Senate leader Marc Basnight and Gov. Mike Easley — all Democrats — as they hammer out in secret hundreds of details that could mean life or death for many programs and services.

It’s a process that is open for abuse. Last year, in the waning hours of negotiations, budget writers inserted roughly $15 million in reserve funds to three state agencies. But the money was controlled by Basnight, Black and Richard Morgan, then the House co-speaker. Much of the money went to nonprofits and governmental programs in favored lawmakers’ districts during election season. An additional $45,000 went to create a state job for a former lawmaker who helped Black retain his post in 2003.

"When the people hear of special or pork-barrel funds in the budget that no one knew about, that only fuels the cynicism that people have toward the process," said Bob Phillips, executive director of Common Cause North Carolina, a nonpartisan public-interest group.

In the 1980s, the state budget was put together behind closed doors by a powerful group of legislators known, unofficially, as "The Supersub," shorthand for super subcommittee. The process became more public in the late 1980s after a spate of media coverage and the rise to power in the House of a group of dissident Democrats who joined forces with Republicans to form a governing coalition.

But over the past decade, much of the process has moved back behind closed doors.

Black, who is now in his fourth two-year term leading the House, said it’s nearly impossible to come up with another way to conduct budget negotiations.

"At some point, the number of people making the decisions has to narrow down," Black said. "You could have all the [lawmakers] and all of the people involved, and would you ever get anything decided then?"

Basnight, though, said open budget meetings would help the process.

"It exposes the positions of the House and the Senate for a better understanding of why you stand where you’re at," he said. "And I believe it leads to a quicker conclusion."

But he declined to say how he could make that happen. It would require an agreement among both chambers.

On Monday, House and Senate negotiators said they still had not resolved major sticking points such as the lottery question, the size of a raise for state employees and whether a cigarette tax increase should be 25 cents or 35 cents. The latest stopgap spending resolution expires Friday.

States’ blueprints differ

There’s no standard way of negotiating budgets among the 50 states, said Arturo Perez, a fiscal analyst with the National Conference of State Legislatures. Some states pass their budgets in piecemeal fashion — education, then health, then transportation, and so on — while others, like North Carolina, wrap it all into one package.

Legislative leaders tend to control the budget process in states such as New York and California, Perez said, while Wisconsin is among the most open. There, lawmakers battle over budget items on the floor into the wee hours of the morning.

"It’s an open process, but it’s a grinding process," Perez said.

Phillips and Ran Coble, executive director of the N.C. Center for Public Policy Research, say lawmakers could help themselves by keeping out items that have little to do with the budget. Special provisions in the Senate budget such as lottery language and allowing UNC-Chapel Hill and N.C. State University to set their own tuition bog down negotiations and give little opportunity for public debate about major policy changes, Coble said.

While Coble agreed that having every lawmaker involved in the negotiations could prove unwieldy, he said that shouldn’t stop the budget conferees from meeting in public. That way, if lawmakers decide to create reserve funds for pork-barrel spending, at least the public doesn’t get the sense that something is being hidden.

And when a budget emerges, some say that lawmakers need more time to read it before voting. Typically, lawmakers are voting on 300-page budgets just hours after receiving them.

"If you think of it as a good novel, you probably can’t read it in a day," Coble said.

Rep. John Rhodes, a Mecklenburg County Republican, proposed such a daylong waiting period for the House budget proposal in a resolution he filed earlier this year.

Black moved the bill to the House Rules Committee, which often serves as the graveyard for unwanted legislation.

Staff writer Dan Kane can be reached at 829-4861 or [email protected].