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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."

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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.

UPDATED: DEMOCRATIC PARTY'S PROBLEMS GROW: The head of the North Carolina Democratic Party is facing questions about credit card charges made during a March trip to a Las Vegas casino to watch basketball games with his old college buddies. Records obtained by The Associated Press show state Democratic Chairman Randy Voller made $3,327 in charges to Southwest Airlines and the Wynn Las Vegas Hotel on an American Express Business Gold Card embossed with his name and that of the North Carolina Democratic Party. He said he's paid off the balance in full. Much more to this story -- click here.

N.C. LAWMAKERS TO PLAY "THE OTHER CAROLINA" IN BASKETBALL: North Carolina lawmakers will challenge their South Carolina counterparts to a game of hoops Wednesday evening at Reynolds Coliseum. The game is the first in at least four years between lawmakers from the two Carolinas. Rep. Burt Jones, a Rockingham Republican who will coach the North Carolina squad, helped revive the tradition. “The games in the past were pretty competitive,” he said. (Scouting report below.)

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SENATE BUDGET TIME: The state Senate released a $20.58 billion proposed budget late Sunday night that would eliminate class-size limits for the youngest public school students, move the State Bureau of Investigation to a department the governor’s appointee controls and puts various environmental programs under the control of a state agency. The proposal represents a 2.3 percent increase over the current budget and is about $17 million short of the budget Gov. Pat McCrory proposed in March.

Senate budget writers will hold a press conference at 10:30 a.m. to discuss it in more detail. Full Senate votes are expected later this week. More here.

NCGA PROTESTERS CHALLENGE CHARGES: As protesters gear up to assemble again Monday to highlight concerns about welfare cuts, health care funding, voting rights, racial justice, tax reform, environmental deregulation, workers rights and more, legal analysts are raising questions about whether the General Assembly police are within their power to arrest the nonviolent demonstrators. Irv Joyner, a law professor at N.C. Central University who has observed the demonstrations, said legal challenges of the arrests are being drafted. “We think we have clear-cut First Amendment issues,” Joyner said. Full story.

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The top three Republican politicians in the state announced Friday they are all together when it comes to Medicaid reform.

Gov. Pat McCrory, Senate Leader Phil Berger and House Speaker Thom Tillis sent out a joint news release emphasizing that – despite criticism of the move toward privatization – the state is proceeding with plans to reign in costs in the $13 billion program.

Their joint announcement said the state Senate’s budget will require the state Department of Health and Human Services submit a waiver application to the federal government. The budget, which will be released Sunday evening, will have to be approved by both chambers in the General Assembly.

A federal waiver would allow the state flexibility in operating and paying for its Medicaid programs. McCrory has said he wants to privatize some of Medicaid as a way to reduce cost overruns.

Guiding principles in the state’s reform plan include focusing on behavior as a way to improve health, making it easier on providers, and developing a reliable estimate of costs.

On Thursday, the House approved spending $400 million through next month to close the current shortfall and repay the federal government other debts.

EDWARDS REGROUPS: Former presidential contender John Edwards has reactivated his license to practice law and is setting out on the speaking circuit, the Associated Press reports. The former U.S. senator and 2004 Democratic vice-presidential nominee is scheduled to appear June 6 at a private retreat in Orlando, Fla., for lawyer clients of the marketing firm PMP.

Edwards has remained largely out of public view since his acquittal in May 2012 on one charge of campaign finance fraud. A judge declared a mistrial on five other criminal counts after jurors couldn’t agree whether Edwards had illegally used campaign money to hide his pregnant mistress as he ran for president in 2008. An itinerary says Edwards will speak for about 45 minutes as part of a program titled “Historic Trials of the Century.” Edwards earned millions as a personal injury lawyer before entering politics.

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The divide between legislative Republicans about how to revamp the state’s tax code became clear Thursday, as House leaders unveiled a dueling plan, calling it a more measured approach.

The House legislation (Read it here.) offers smaller income tax cuts in exchange for fewer new taxes on services. Supporters pledged it would give a break to all taxpayers but the numbers remain unclear. It contrasts greatly with a sweeping Senate proposal that some experts believe could leave many people with a tax hike, a point its supporters dispute.

“We think our tax plan is a lot simpler in terms of the expansion of the sales tax base,” said state Rep. David Lewis, a Dunn Republican leading the effort. “We think it makes sense to people.”

The legislature will jump right from crossover into budget debates. The Senate budget is set to be released online Sunday evening, said Sen. Pete Brunstetter, a chief budget writer.

Budget subcommittees will talk about the proposal in Monday meetings. On Tuesday, the budget proposal will go to the Senate Appropriations Committee and come to the floor on Wednesday and Thursday.

Brunstetter, a Winston-Salem Republican, wouldn't give details on the budget, such as a bottom line. "We'll tell you after it gets released," he said.

UPDATE: Senate leader Phil Berger says the budget proposes to spend $20.4 billion, less than Gov. Pat McCrory's $20.6 billion proposal.

The budget does reflect proposed tax changes that have not yet been approved. The Senate tax proposal assumes a reduction in state revenue.

"The fiscal impact of tax reform will be reflected in the budget," Brunstetter said.

TODAY AT THE STATEHOUSE: As the final two days of the self-imposed crossover deadline begin, it's crunch time. You can tell from the lobbyists working the halls, either trying to get a bill to move or asking committee chairman to "pray on it" for a little while longer. And the controversial bills are coming the surface. A House committee will consider a bill to extend "protections of conscience" to more medical professionals and cover more things, such as providing contraception. In the same committee, another measure dubbed the "Religious Freedom Restoration Act" is sure to recall attempts earlier this session to declare the state's ability to establish an official religion.

The full House - which convenes near 2 p.m. -- will also consider a bill to soften rules on where local governments must post public notices. A controversial amendment would tell newspapers how much they could charge for such advertisements. The Senate this afternoon will consider measures to amend environmental regulations and repeal local smoking bans. Gov. Pat McCrory is spending another day in New Orleans at a Republican Governor's Association event.

WOS ROADSHOW CONTINUES: A week after a major gaffe by Health and Human Services Secretary Aldona Wos, her statewide tour to tout Medicaid reforms continues. She visits Durham on Wednesday where she will encounter members of the Medical Professionals for Expanded Health Access who expect to question her about the state's decision to reject a Medicaid expansion. Wos blamed Democratic Insurance Commissioner Wayne Goodwin for the decision -- even though it was ultimately made by her boss, Gov. Pat McCrory. The event starts at 4 p.m.

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TODAY AT THE STATEHOUSE: The action starts early Tuesday and will likely stretch past 10 p.m. again. The House and Senate plan to convene a skeletal session just before 10 a.m. to read in committee reports, then recess until 2 p.m. House Speaker Thom Tillis said the session will go until 5:15 p.m. or so before a dinner recess for committee meetings. The chamber will reconvene at 7 p.m. and go late. The Senate isn't expected to stay as long but its calendar is getting crowded. Gov. Pat McCrory lists no public events.

McCRORY'S OFFICE WON'T RELEASE DAILY SCHEDULE ANYMORE: The governor's Communications Director Kim Genardo is changing the office's policy of releasing a daily calendar. Genardo said if there is no event scheduled, she won't send out a notice stating as much, meaning some days will have no notice to the governor's schedule. McCrory pledged to release a daily schedule during the gubernatorial campaign as he bashed his predecessor, Democratic Gov. Bev Perdue, for taking a "secret" trip to Pennsylvania to study fracking rigs. Republicans jumped on McCrory's Democratic opponent for not pledging to do the same. “Everyone knew where I was as mayor,” McCrory said a year ago. “My records were open."

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