Stimulus may cost state millions

The federal government's economic stimulus may siphon money out of North Carolina's treasury at the same time it is shoveling dollars in.

The plan signed into law by President Obama on Tuesday funnels $6.1 billion to the state for projects such as roads and schools. The federal tax breaks in the plan, however, may force state officials to offer parallel state tax cuts that would cost the state at least $760 million during the next two years.

"Everybody's talking about what we're going to get," said state Sen. Dan Clodfelter, a Charlotte Democrat and a co-chairman of the Senate committee on tax laws. "But nobody is talking about what we might be losing.

State lawmakers were banking on the federal government to provide money that would help close an estimated $2 billion gap in next year's budget. The stimulus package provides some of those dollars.

At the same time, state Revenue Department officials estimated that the cost of changing state tax laws to mirror the federal tax cuts in the stimulus plan would run $340 million for the fiscal year beginning July 1 and $420 million for the next year.

Those figures could grow. (N&O)

Open hearings

House Speaker Joe Hackney said today he would like the ethics law changed so that lawmakers and executive branch officials would face open hearings if probable cause is found on an ethics complaint.

"I think that's a good change," said Hackney, an Orange County Democrat.

Hackney played a lead role in shepherding much of the ethics, campaign finance and lobbying reforms in the wake of scandals involving former House Speaker Jim Black, a Mecklenburg County Democrat.

But while the reforms produced more transparency in government — witness the lobbying reports showing hundreds of thousands of dollars spent on the land transfer tax issue this year-- they also closed the door on state ethics commission hearings.

That has drawn complaints from open government groups and the state ethics commission's chairman, former state Superior Court Judge Robert Farmer.

Two other Democrat leaders on ethics legislation, Rep. Deborah Ross of Raleigh and Sen. Daniel Clodfelter of Charlotte have also said they will look to move legislation that opens the ethics hearings.

College dropout?

A Senate bill would let North Carolina drop out of the Electoral College.

Under the legislation, the state would sign a multi-state pact to award all of its electors to the winner of the popular vote nationally. So far, only Maryland has approved the pact.

Under the system, Al Gore would have been elected president in 2000.

The pact is being pushed by the California-based National Popular Vote group as an end run around the need for a constitutional amendment, which would likely be blocked by smaller states that are disproportionately powerful under the current system.

A similar push for direct election of senators in the early 1900s required a constitutional amendment.

The bill is sponsored by Democratic Sens. Daniel Clodfelter of Charlotte, Katie Dorsett of Guilford County and Eleanor Kinnaird of Carrboro.

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