CHECK THE MAIL: Gov. Bev Perdue's administration has not responded to a letter from the state's District Attorneys complaining about the erosion of services for the mentally ill who are accused of crimes. (N&O)

JUDGE NOT: Sen. Kay Hagan has withdrawn her support for a possible lifetime federal appointment for a state judge who ruled in favor of a company that includes Hagan's husband. (Greensboro N & R)

SPEND AWAY: A higher sales tax means North Carolina consumers will get a larger break when they purchase energy-efficient appliances during this weekend's tax break. (AP)

After working for nearly a decade to close Dorothea Dix Hospital, state mental health administrators now intend to keep a sizable number of staff and patients at the aging Raleigh facility for years.

Lanier Cansler, secretary for the state Department of Health and Human Services, said this week that he plans to move about half of Dix's more than 200 patients to Central Regional Hospital in Butner when it opens fully in October.

But he said Dix will remain open as a stand-alone psychiatric hospital, with its own director and administrative staff. It will no longer serve as a satellite campus for the new Butner facility.

State legislators affirmed that decision earlier this month when they approved a state budget that restored $6 million in funding for operations at Dix for the next year. That move came as legislators made $155 million in spending cuts for other mental health programs in the 2010 budget.

The move to continue operating Dix as a state mental hospital will hamper efforts to turn the more than 300 acres between downtown Raleigh and N.C. State University into a major park operated by the City of Raleigh or a nonprofit foundation.

It also offers evidence that the sweeping 2001 mental health reform plan has failed. A centerpiece of that effort, which was passed by the legislature and carried out by the administration of former Gov. Mike Easley, was a plan to reduce the need for beds at mental hospitals. Instead, there would be more private, community-based treatment. (N&O)

* The mentally ill in North Carolina will have less access to care as the state makes dramatic changes to save money in the recession.

The budget approved by the legislature Wednesday cuts about $40 million, or 12 percent, in mental health treatment for people without other insurance.

The cuts come despite the state's goal of providing more treatment to people where they live. The cuts and changes rip holes in an already-weak mental health system, advocates say.

They predict it will be harder for poor people without insurance to get community mental health care, and more could end up in emergency departments and jails. (N&O)

* As teachers worry about job security and residents pay a penny more on the dollar in sales tax, one interest group is emerging from North Carolina's new budget unscathed: state universities' athletic booster clubs.

Taxpayers will continue to pick up the tab for granting in-state tuition to out-of-state athletes at a cost of $10 million a year. (N&O)

BECAUSE SHE SAYS SO: Gov. Beverly Perdue dropped a $1.6 billion list of proposed tax increases. The sugar meant to help the bitter pill go down: some of them are temporary. The Republicans were not convinced. Speaker Joe Hackney says Perdue's pitch could help budget negotiators actually get somewhere.

POLITICAL NUMBERS: The state wasted $635 million, or 25 percent of the money it spent on community services over three years. Meanwhile, Rep. David Lewis, a Dunn Republican, launched a campaign to show that the Democrats are using faulty math in describing a budget deficit. And early this week, the legislature enacted its 272nd law of the still-going session.

BULGING INBOXES: Perdue toughened the state's policy on e-mail retention, wiping away nearly all of the discretion employees had on deciding whether a message should be kept. Some state government delete keys will appreciate the rest.

IN OTHER NEWS: Federal investigators continue to look at more details of Mary Easley's work at N.C. State University. A Senate team chugged milk fast enough to win $200 for charity. And in a debate over whether to make state laws gender neutral, Rep. George Cleveland, a Jacksonville Republican, noted that he had lots of respect for "the female race."

Companies that provide the mental health service called community support were in Raleigh today to ask legislators to spare mental health programs from cuts.

Though the company representatives said they were concerned about mental health spending in general, they talked mostly about the controversial mental health service community support, Lynn Bonner reported.

Legislators are discussing cuts to community support over the next two years as part of a plan to phase-out the service.

A legislative report this week said that the state wasted more than $635 million on the service from April 2006 to February 2009 because it was poorly planned and monitored.

The company representatives said the decision to cut community support is political, and that their clients are being punished for problems caused by others.

Community support works when it's done properly, said Andy Anderson, president of Community Innovations Inc. in Whiteville.

"The simplest way of trying to fix a problem is total elimination," he said. "That's not the way to do it." He equated the decision to phase-out community support because of past abuses with tearing up Interstate 95 because a driver got a speeding ticket.

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Department of Health and Human Services secretary Lanier Cansler talked back in February about hiring an assistant secretary who would concentrate on expanding community mental health services.

The person would work with private providers, local mental health offices, advocacy groups and others on getting services where they're needed, Lynn Bonner reports.

Cansler hasn't filled that job yet. It's not the hiring freeze that's put the move on hold, Cansler said, but a time crunch that has him focused on big, immediate issues like the budget.

Cansler said he has been talking to potential hires about the position.

"I hope in the coming weeks we will name someone," he said.

North Carolina spent up to $226 million in unnecessary costs after launching ill-fated mental health reforms in 2006.

The legislature's Program Evaluation Division released a report today saying that the Enhanced Services Package portion of mental health reform that the legislature put in place cost $2.4 billion between April 2006 and Febuary 2009. Most of that was federal money, but the state paid $827 million.

The Program Evaluation Division reported that advanced planning and oversight could have saved at least $177 million and as much as $226 million. Division staff are scheduled to present their findings to the division's oversight committee at 2 p.m. in room 544 of the Legislative Office Building.

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Senate Republican Leader Phil Berger fires off the traditional Republican criticisms of the Democrats running the state as taxing too much, spending too much and holding office too long.

But he adds to that: messing up too much. Berger, who sat down with N&O editors Tuesday, rolled out his list of Democratic bumbling, such as a string of state officials, including a speaker of the House, sent to prison for corruption.

He highlights the state health plan's financial crisis that required a bailout, deaths and neglect in the mental health system, a probation system that lost track of parolees who went on to kill and what he sees as a history of budget mismanagement that has contributed to the state's current debacle.

"The Democrats have been given a pass on competence," Berger said. "They've not done a very good job over the past 10 or 12 years."

Berger acknowledged that, given that backdrop, Republicans fail to capitalize on those failings and win elections. He attributes that to a fundraising disparity, Democrats nominating solid candidates and national momentum behind Democrats in recent elections.

The House voted on a dozen bills in its first hour of crossover week.

Speaker Joe Hackney called for a recess at 6 p.m. so a heavy volume of committee reports could be read into the record. Bills voted on before the recess covered a range of subjects. Here are some highlights of bills that cleared the House.

HB 266: Requires the state to collect and publish statistics on how many people are killed after run-ins with law-enforcement.

The bill adds to the duties of the state Division of Criminal Statistics, part of the Justice Department. The division would have to collect statistics about the use of deadly force by law enforcement officers.

HB 439: Requires the State Health Plan to pay for ambulance services run by cities or counties.

HB 672: Requires more transparency for mental health providers. The bill requires certain local management entities to report twice a year on how they are spending money. The entity must also hold a public hearing once a year.