SEANC wants a bill on the State Health Plan reconsidered.

In a letter to Speaker Joe Hackney, State Employees Association of N.C. head Dana Cope wrote that a recent ethics allegation raises questions about the way a recent House bill was handled.

In the letter, Cope alleges that an insurance company lobbied a state legislator to get the bill killed, and that the matter was referred to the State Bureau of Investigation. 

Earlier this month, the Legislative Ethics Committee reported that a lawmaker said he was approached by a lobbyist with an offer to get a constituent's debt forgiven in exchange for killing a bill. 

Though Cope names names, committee members did not identify either the legislator or the lobbyist, and neither they nor Attorney General Roy Cooper's office would confirm if the SBI was investigating.

Cope argued that the allegations over the House bill raise questions about fixes to the State Health Plan signed into law by Gov. Beverly Perdue, since the insurance company was consulted by legislators about the State Health Plan fix.

"It seems inconceivable to me that anyone would have faith in in the vote on that bill after recent events," Cope said in the letter.

He asked for Hackney to order the House to reconsider the State Health Plan bill.

Franklin Freeman thinks two things led to the increase in the Order of the Long Leaf Pine.

The longtime adviser to former Gov. Mike Easley said that they put an application for the award on their Web site and publicized that it was open to retiring state and local government workers.

Between January of 2001 and December of 2008, 26,000 state workers and 6,000 city and county employees retired, according to figures from the state retirement system. Many were nominated by their bosses for the order over the Internet.

"When we put the application form on the Web, it made it much more accessible," Freeman said.

Easley gave out 4,034 awards during his two terms in office, about one and a half times as many as his predecessor. Former Gov. Jim Hunt had given roughly 2,730 in his most recent two terms. 

Freeman, who gave out the award a number of times on Easley's behalf and received it himself, said it comes with a certificate and the right to give the state toast.

"Other than that, it's just the honor associated with the award, and that to some degree perhaps is in the eye of the beholder," he said. 

Gov. Beverly Perdue's proclamation declaring a furlough for state workers underwent a rewrite Tuesday after complaints from state employees that it was confusing.

The revised version makes it clearer that state employees are not required to take 10 hours off without pay, in addition to having their pay cut by half of a percentage point.

The initial proclamation said the governor's budget plan read:

a) The part of the annualized base salaries of all covered employees paid from moneys appropriated by the 2008 Appropriations Act will be reduced by .5 percent over the remainder of this year: and

b) all full time employees whose salaries are reduced pursuant to subjection (a) shall be furloughed for 10 hours without pay at times to be designed by their employing agency between June 1 and December 31, 2009, and all employees employed less than full-time whose salaries are reduced pursuant to subsection (a) shall be furloughed a pro-rated number of hours.”

The revised proclamation changes the language to make it clear that employees will not get hit twice.

The new language for part (b) now reads "in return, all full-time employees whose salaries are reduced pursant to subsection (a) shall receive 10 hours of flexible furlough leave to be taken at times to be designated by their employing agency between June 1 and December 31, 2009, and all employees employed less than full-time whose salaries are reduced pursuant to subsection (a) shall receive flexible furlough leave for pro-rated number of hours."

North Carolina is $1 billion worse off than previously thought.

Gov. Beverly Perdue is expected to announce this morning that the state has a $3.3 billion shortfall in the current fiscal year, according to legislative leaders.

As part of a remedy, she is expected to propose furloughs of state workers, an idea she had previously rejected.

Update: Perdue signed an executive order this morning implementing a flexible furlough program for state workers that will save $65 million this year.

All teachers' and state workers' compensation will be reduced by an annualized amount equivalent to 0.5 percent for the rest of the fiscal year. In exchange, they will receive 10 hours of flex time.

In addition, Perdue plans to capture more special funds, tap the state's reserves and use more federal recovery dollars to raise the $1 billion needed to close the budget gap.

She has also asked the legislature to pass a bill holding longevity pay, unused leave, service credit and health and retirement benefits harmless.

"North Carolina continues to experience the effects of a national economic crisis, which force me to make difficult decisions in order to maintain a balanced budget through June," she said in a statement.

A bill would protect state workers from being fired over their sexual orientation.

Sen. Charlie Albertson, a Duplin County Democrat, filed the bill, which would add sexual orientation to the other equal opportunity categories in state government: race, religion, color, creed, national origin, sex, age and disability.

It would also add a nondiscrimination policy for legislative personnel.

Erica Baldwin, a spokeswoman for the State Employees Association of N.C., said that it supports the bill, though it had not sought it.

"Although the nondiscrimination clauses aren't one of our top policy platform objectives, SEANC supports any bill that protects state employees and retains the most quality workers," she said.

Baldwin said, as far as she is aware, SEANC has not received any calls about workers being fired over their sexual orientation. 

Janet Cowell cautioned legislators about furloughs today.

In a press release, the state treasurer warned legislators about several fixes for the state budget shortfall that could hurt the state's AAA bond rating.

She said putting off debt payments or depleting the state's rainy day fund could lead rating services such as Moody's to lower the state's financial grade, leading to higher interest rates for public bonds.

Among the short-term fixes she warned could hurt the state: Ordering state workers to take furloughs.

The issue has been a hot topic of late, with Gov. Beverly Perdue saying she does not want them and House Speaker Joe Hackney saying they should be on the table. A bill has been introduced that would give Perdue the authority.

A staffer for Cowell said the release was not meant to take a stance on the issue, but simply to inform legislators.

Gov. Beverly Perdue says it's time for "truth in budgeting."

As part of her proposed budget, Perdue said the state should not set aside money for all state jobs to be filled all year long.

Instead, it should acknowledge that some jobs will be open when state employees quit, retire, die or get fired and save that unspent money.

The measure would save $150 million, but it's already being questioned by legislative leaders who say the money is needed to help state agencies cope with unexpected problems.

"When you take that slack out of the rope on the front end you begin to work more at the margin," said William Rivenbark, an associate professor of public administration at the UNC School of Government.

He said the problem is that state government is mandated to provide services. Unlike a business, it can't cut back because finances are tight. (N&O)

Gov. Beverly Perdue's budget is not as drastic as some feared.

Her initial $21 billion proposal would raise taxes on smoking and drinking, cut as many as 268 state employees and shuffle more than 1,000 more, eliminate 20 smaller programs, close seven prisons and increase per-pupil spending. (N&O)

It also expands the Earned Income Tax Credit, makes bonuses to veterans tax-free, extends some business tax deductions and increases licensing and vital records fees. (N&O)

Legislative leaders say the plan is a good starting point, though they cautioned that tobacco and alcohol taxes as well as an accounting change may be a tough sell to lawmakers.

"I don't think you'll see a lot of differences with what she's proposed," said Senate leader Marc Basnight. (GN-R)

State employees are relieved the proposal avoids furloughs, pay cuts and massive layoffs. (Times-News) But tobacco and alcohol interests say the taxes would hurt their industries and put jobs at risk. (Times-News)

Politicians from the rural areas served by the seven prisons also object. (AP)

The N.C. Department of Correction keeps vacant jobs open longer to pay the bills.

In a recent series on probation in the N&O, state correction officials said they sometimes don't hire new workers so they can use the salary money for other things:

Last year the Department of Correction used $68 million in unspent salaries, known as lapsed salaries, for other purposes. That's 5 percent of the Department of Correction's $1.3 billion budget.

The diversion of money budgeted for salaries to meet other needs is common in state government.

"Lapsed salaries are part of the flexibility on which government runs," said House Speaker Joe Hackney, a Democrat from Chapel Hill.

Most of the lapsed salary money came from vacancies among the 22,000 positions in the state prison system.

To save money in next year's budget, Gov. Beverly Perdue has proposed ending the practice of assuming that state agencies will fill 100 percent of vacant positions.