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Morning Memo: McCrory to announce Medicaid overhaul; big day at statehouse

McCRORY TO ANNOUNCE MEDICAID SYSTEM OVERHAUL: Gov. Pat McCrory rejected a Medicaid expansion earlier this year saying the system was broken and Wednesday morning he is expected to describe how he plans to fix it. The Republican has talked frequently about the rising costs of the healthcare system for select low-income and disabled residents and issued a video preview Tuesday saying he would create a "partnership" that will help keep costs low. Check Dome later today for more details from the 10 a.m. press conference.

***It's a jam-packed day in North Carolina politics. Get the full scoop on all the big stories from the Dome Morning Memo below. Send tips and news to dome@newsobserver.com.***

Morning Memo: McCrory adminstration reverses Confederate flag stance

FLAG FLAP PROMPTS McCRORY ABOUT-FACE: A Confederate battle flag hung inside the old North Carolina State Capitol last week to mark the sesquicentennial of the Civil War is being taken down after civil rights leaders raised concerns. The decision was announced Friday evening, hours after the Associated Press published a story about the flag, which officials said was part of an historical display intended to replicate how the antebellum building appeared in 1863. The flag had been planned to hang in the House chamber until April 2015, the 150th anniversary of the arrival of federal troops in Raleigh.

"This is a temporary exhibit in an historic site, but I've learned the governor's administration is going to use the old House chamber as working space," Cultural Resources Secretary Susan Kluttz said Friday night. "Given that information, this display will end this weekend rather than April of 2015." The decision was a quick about-face for the McCrory administration, which initially defended the display. More from AP here.

***Good morning. Thanks for reading the Dome Morning Memo. Much more N.C. political news and analysis below. ***

Morning Memo: Ahead of 2014 race, Berger, Tillis hit by national Democrats

2014 WATCH: National Democrats hit potential GOP candidates Tillis, Berger on Ryan budget. Senate leader Phil Berger and House Speaker Thom Tillis are making enough moves toward challenging incumbent U.S. Sen. Kay Hagain in 2014 that its attracting the attention of national Democrats. The Democratic Senatorial Campaign Committee is asking whether the two Republicans support Congressman Paul Ryan's budget plan. "Republicans in Washington are back with their Medicare-busting budget plan, but potential GOP Senate hopefuls Phil Berger and Thom Tillis have yet to tell North Carolinians where they stand," starts a statement from the DSCC set for release later Tuesday.

TODAY AT THE STATEHOUSE: The House will consider a bill to curtail local building design standards that local mayors want stopped dead in its tracks (more below) as well as a measure to limit tanning beds for those under age 18. House convenes at 1 p.m.; Senate convenes at 2 p.m. Gov. Pat McCrory will make a school safety announcement in Apex in the morning.

***Good morning. Thanks for reading the Dome Morning Memo -- the source for exclusive North Carolina political news and analysis. Send news and tips to dome@newsobserver.com. Read more below.***

Legislative preview: Meet your delegation, look at the issues, meet key players

On Wednesday, the General Assembly returns to Raleigh to begin the long session, which is expected to last about five months. In today's paper we take a comprehensive look at the people and the issues that will be making the news, and the laws, in the months ahead. From lawmakers to lobbyists -- and lawmakers turned lobbyists -- plus key staffers behind the scenes, and an army of competing interests, the statehouse on Jones Street is about to begin whistling like a kettle.

Easley's sin tax proposal

For the second year in a row, North Carolina may consider a sin tax hike.

In his final budget in 2008, Gov. Mike Easley proposed a 20-cent increase in the cigarette tax, to 55 cents a pack, to raise public school teacher pay.

He also proposed an additional four cents on a can or bottle of beer, three cents on a bottle of win and four percent on liquor to pay for the mental health system.

(In a classic Easleyism, he said heavy drinkers would probably end up needing treatment sooner or later anyway.)

Today, Gov. Beverly Perdue is expected to propose much stiffer hikes of $1-per-pack of cigarettes and 5 percent on alcohol. 

It is not known yet whether Perdue will tie the increased revenue to specific spending, but teacher pay and mental health were not enough for Easley. Legislators rejected his two proposals out of hand.

Crowder wrote report on Perdue plans

Courtney CrowderCourtney Crowder has already done his homework.

As Gov.-elect Beverly Perdue's legislative director, Crowder will take a lead role in implementing her public policy decisions and keeping her campaign promises.

Luckily for him, he just co-authored a report on that very subject.

Crowder is one of five analysts and lobbyists on the government relations team at Capstrat, a Raleigh public relations firm, who recently went over Perdue's platform for a report called "Now What?"

The report says that Perdue will focus on early childhood education, free tuition for community colleges, mental health reform, increased health insurance coverage, reforming the N.C. Department of Transportation, championing "green collar jobs" and reducing small business taxes, among other things.

It also notes that Perdue said she will work with other governors to reduce corporate incentives, but says she will likely continue expanding them in the short term. It notes the "budget constraints" and the "shrinking financial pie" but leaves open how they will be resolved.

One prediction from the report may turn out to be a bit optimistic.

"Announcements of who will be filling (Cabinet) posts are expected by the end of the year," it says.

Perdue and McCrory's themes

The two gubernatorial candidates have their themes down.

In their opening statements at a debate at WTVD in Durham tonight, Republican Pat McCrory and Democrat Beverly Perdue sketched out the major areas they hope to focus in in the campaign and at the debate.

McCrory, the mayor of Charlotte, focused on gangs, mental health care reform and corruption in state politics.

He also joked that his sister, Linda, almost didn't let him into her home because she'd seen a TV ad portraying him as "a danger to the middle class."

Perdue, the lieutenant governor, talked about improving education, creating new jobs and increasing access to health care.

She said she wanted a "new North Carolina" where "families worry less and dream more."

Easley's rough final year

Mike Easley's having a rough year.

In his last year in office, he seems to be spending as much time trying to defend himself from public controversy as keeping the state out of a budget shortfall.

"I've referred to it as the quack of the lame duck," joked Senate Minority Leader Phil Berger.

Easley has been blamed for problems with the state's mental health reform, destroying public e-mails and taking expensive trips overseas. He's also had to defend his wife's $80,000 pay raise. 

His achievements, including the state lottery, More at Four and alternative highs chools, may be overshadowed when he leaves office, and controversy gives the state Republican Party ammunition in its bid for the Executive Mansion.

"They say first impressions count, but when you're going out of office, last impressions can last a long time," notes Democratic consultant Gary Pearce. (AP)

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