A NEW DIX DEAL: Gov. Pat McCrory and Raleigh Mayor Nancy McFarlane will hold a joint news conference this morning to discuss the Dorothea Dix lease. A state House committee approved a new version of a bill Wednesday that would revoke Raleigh’s disputed lease on the Dorothea Dix property near downtown. The compromise bill comes with a sweetener that has the support of city leaders and the governor’s office.

But the question is whether the Senate will go along. Sen. Ralph Hise, a Spruce Pine Republican, said the Senate remains committed to its version of the bill. "As we've clearly seen, the lease was entered into by the state illegally, it is substantially different than what even the Council of State had approved, and it's in the bad interest of the state," he said. "If they need to start, we'll start from scratch. But you can't begin on a foundation that's that weak."

GOP LAWMAKERS REACT TO BRAWLEY LETTER: “If you have a disagreement, that's not how one handles it and I'm saddened," said Rep. Craig Horn, a Weddington Republican. "We don't need distractions." Other Republican lawmakers refused to talk about it. "I don't have anything to say," said House Majority Leader Edgar Starnes. Rep. Ruth Samuelson, a Charlotte Republican and top GOP leader, said she was surprised by the letter read on the floor. "I thought it was an inappropriate use of the floor by Rep. Brawley." If anything, Samuelson said, "I think it will help bring us together more because it doesn't represent the majority of the caucus."

***Thanks for reading the Dome Morning Memo -- congrats to the NCGA team on the big win against South Carolina last night. More North Carolina political news below. ***

RALEIGH -- A deep bench and powerful inside presence under the basket gave North Carolina lawmakers the advantage they needed to make a second half run and beat a squad of South Carolina legislators 35 -27 in a charity game Wednesday.

With the win at Reynolds Coliseum in Raleigh, North Carolina reclaimed the trophy from its southern rival and extended its series lead to 11-6 in an on-again, off-again competition that dates to 1979.

"It was a great game," said Rep. Burt Jones, a Rockingham Republican who coached the team and reveled in his post-game interview. "I think we played just a little bit better. ... We had a little run in the second half and pulled away."

The 6-foot, 5-inch center Rep. Chris Millis, a Hampstead Republican, scored big points for the bipartisan N.C. General Assembly team and swatted a few big South Carolina shots, easily winning the crowd's MVP nod. "Everybody played hard," he said, sounding just like a professional athlete. "It was a team win."

Gov. Pat McCrory made an appearance in the second half, playing good minutes but later clanked two free throws late in the game. "I've never been so nervous in my life," McCrory said at the line.

An umbrella group of anti-abortion centers in North Carolina would receive $250,000, under the budget the Senate approved Wednesday.

Sometimes known as crisis pregnancy centers, abortion-rights advocates claim they provide misleading information and coerce vulnerable young women. Representatives of the group, Carolina Pregnancy Care Fellowship, told The N&O in 2011 that its centers work hard to provide factual, impartial help to teenagers and women who are conflicted about their pregnancies.

Amendments to the state budget were flying fast and furious leading up to the Senate’s approval on Wednesday.

One of them would have required any officeholder who fails to file a state economic disclosure form within 60 days could be removed from office immediately.

That proposal came from Sen. Gladys Robinson, a Democrat from Guilford County, but it didn’t get anywhere.

Rules Chairman Sen. Tom Apodaca, the Hendersonville Republican, had it tabled – but in a nice way.

“It has a lot of merit,” he said. “I just don’t think the budget is the place to put it. It needs to be discussed thoroughly and looked at. It’s a major policy change that’s probably needed.”

WASHINGTON - Charlotte Mayor Anthony Foxx, who has been nominated by President Barack Obama to be U.S. Transportation Secretary, has so far had an easy confirmation hearing before the Senate’s Commerce, Science and Transportation Committee Wednesday afternoon, The Charlotte Observer's Steve Harrison reports.

Foxx has discussed issues such as the furloughing of air-traffic controllers, tolling interstates and replacing old bridges. Senators from both parties have so far praised Foxx.

Republican Senator Tim Scott of South Carolina said the hearing was a “most amazing confirmation process.” He added he has heard nothing but “kind comments.”

The mayor was introduced by N.C. Democratic Senator Kay Hagan and Republican Senator Richard Burr.

Stu Rothenberg, a noted national political analyst, has moved North Carolina 2014 Senate race from “lean Democrat” to “tossup/tilt Democrat.''

Writing in his blog Wednesday, Rothenberg, editor of the Rothenberg Political Report, based the changed on the changing national political landscape with recent controversies having put the Obama administration on the defensive and breathed new life into the Republicans.

Democratic Sen. Kay Hagan plans to seek re-election, but it is far from clear who will emerge from a large potential field of GOP candidates.

“Given the different natures of of midterm electorates,” Rothenberg writes,” the new political narrative increases the risk for Democratic candidates in red states, where Democrats must win independent and, in many cases, Republican voters to be successful.''

Stu Rothenberg, a noted national political analyst, has moved North Carolina 2014 Senate race from “lean Democrat” to “tossup/tilt Democrat.''

Writing in his blog Wednesday, Rothenberg, editor of the Rothenberg Political Report, based the changed on the changing national political landscape with recent controversies having put the Obama administration on the defensive and breathed new life into the Republicans.

Democratic Sen. Kay Hagan plans to seek re-election, but it is far from clear who will emerge from a large potential field of GOP candidates.

“Given the different natures of of midterm electorates,” Rothenberg writes,” the new political narrative increases the risk for Democratic candidates in red states, where Democrats must win independent and, in many cases, Republican voters to be successful.''

President Barack Obama's standing in North Carolina has dropped in the state, according to a new poll.

The president had an approval rating now stands at 45 percent positive and 53 percent negative, according to a survey by Public Policy Polling, a Democratic leaning firm based in Raleigh.

In March, the same firm found that Obama's approval rating was 47 percent and his disapproval rating was at 50 percent.

In recent days, Obama has been dealing with several controversies involving the IRS singling out the tax returns of conservative groups, and the Justice Department investigating possible leaks of classified information to AP.

By comparison, Republican Sen. Richard Burr's approval rating was 38 percent, and his disapproval rating was 40 percent.

The survey of 500 North Carolinians was conducted May 17-20 and had a margin of error of plus or minus 4.4 percent.

In a rare move, a leading Republican lawmaker resigned his committee chairmanship Wednesday, citing a litany of differences with House Speaker Thom Tillis and accusing him of a conflict of interest.

It's the second time in less than a month that a Republican lawmaker broke ranks to condemn Tillis' leadership as he considers a bid to challenge U.S. Sen.Kay Hagan in 2014.

Rep. Robert Brawley of Mooresville's decided to step down as a Finance Committee chairman in a letter that listed four reasons, including the speaker's apparent business relationship with Time Warner. "You slamming my office door shut, standing in front of me and state that you have a business relationship with Time Warner and wanting to know what the bill was about," Brawley wrote, not mentioning the specific legislation. "You and I both know the bill stifles the competition with MI Connections in Mooresville."

Brawley also asserts that the House's vote in last year to make the N.C. Bail Agents Association the only group allowed to certify bondsmen gave a monopoly to Rep. Justin Burr's family. (The bondsmen dispute was thesubject of a 2012 article in the News & Observer.) Burr's father, Phil Burr, is the current president of the association. The junior Burr excused himself from the vote. A judge later issued an injunction blocking the law.

"I look forward to working with you and the Republican team for Republican goals and objectives, but I reserve the right to continue to represent my district and to fight for what I believe is American," Brawley wrote.

Republican Labor Commissioner Cherie Berry runs even with Democratic Sen. Kay Hagan in a new poll.

Berry and Hagan are tied at 45 percent in a potential 2014 match-up, according to a survey conducted by Public Policy polling, a Democratic leaning firm based in Raleigh.

In the GOP primary to be held next May, Congresswoman Virginia Foxx(15 percent) is in a virtual tie with Berry (14 percent.)” Following them is Senate leader Phil Berger and Congresswoman Renee Ellmers, each with 10 percent, physician Greg Bannon with 7 percent, House Speaker Thom Tillis with 6 percent, former ambassador Jim Cain with 4 percent, Mark Harris and Lynn Wheeler each with 3 percent.

None of the potential Republican candidates are very well known across the state, according to the poll.

Supporters of the Racial Justice Act mounted an offensive Wednesday in hopes of beating back this session’s attempt to wipe the Act off the books and resume executions.

On Wednesday morning, a House judiciary subcommittee took public input on SB306, which has passed the Senate and will be voted on in the subcommittee next week. Afterward, RJA supporters – including about a dozen legislators, two lawyers, a doctor and a relative of a murder victim – gathered for the news conference.

The bill, sponsored by Sen. Thom Goolsby, a Republican from Wilmington, would repeal the Racial Justice Act; allow doctors, nurses and pharmacists to participate in executions without retribution from licensing boards; and speed up the process leading to executions.

The bill includes $675 million for Staffing for Adequate Fire and Emergency Response (SAFER) grants. The money is used for equipment purchases and hiring. Price’s amendment allows the use of the funds for firefighter retention.

North Carolina communities received 10 SAFER grants worth more than $1.9 million last year.

Gov. Pat McCrory declined to say Wednesday whether he would veto a state budget that includes provisions he disagrees with.

The Republican governor told the Charlotte Observer he believes he can compromise with leaders of the GOP-controlled General Assembly. McCrory doesn’t like some parts of the Senate budget that could be passed by that body Wednesday. Among them: a proposal to eliminate special Superior Court judges, transferring the SBI from the Attorney General’s office to the Department of Crime Control and Public Safety and the lack of pay increases for state employees. “I’ll probably follow the same line I did as (Charlotte’s) mayor,” the governor said. “I never showed my cards this early in the process.”

Supporters of continuing public financing for high court judges Wednesday brought to Raleigh two prominent West Virginia Republicans to argue that North Carolina's law was a model for keeping the courts impartial.

Former West Virginia S.C. Court Justice John F. McCuskey and his son, Delegate John B. McCuskey, noted that their state had recently adopted a public financing law modeled after North Carolina.

“The perception of judges being bought, rather than acting impartially created a great distrust among the populous,'' said McCuskey, the former justice, who served on who served on the West Virginia Independent Commission on Judicial Reform. “Everyone agreed, Democrat and Republican, that something needed to be done.''

McCuskey, a Delegate and self-described conservative, said the business community wants to be sure “it will get a fair shake'' in the courts and this is one way of helping making sure it happens.

The McCuskeys were brought to Raleigh by the NC Center for Voter Education, where they met with legislative and judicial leaders, and testified before the House Elections Committee. They come at a time when both Gov. Pat McCrory and legislative leaders are considering proposals to abolish the nation's first public financing system for appellate court judges that was created in 2002.

The state Department of Health and Human Services' testing program for the new Medicaid billing system was seriously flawed, a report from State Auditor Beth Wood's office said.

The state is preparing to launch a new, expensive, and long-delayed Medicaid billing software on July 1. DHHS did not have adequate tests and evaluations in place to make sure the system, which DHHS calls NCTracks, is ready, the audit says.

In its response, DHHS agreed with the recommendations and is acting on them.

Even though DHHS was moving to plug holes in its preparations, the audit includes an ominous warning.

"The complexity of the NCTracks system makes it impossible to predict all of the scenarios that could impact the project, even after it is tested in accordance with industry best practices."

In other words, providers should expect things to go wrong.