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GOP ABANDONS PLEDGE FOR TAX REFORM: From Rob Christensen's column: Tax reform in North Carolina died last week. RIP. …The House has rolled out its plan, and the Senate has rolled out an alternative plan. Those plans focus almost exclusively on cutting corporate and personal income taxes, rather than revamping the 1930s tax code. So tax reform is dead. In its place, we have large tax cuts, the size and shape of which will be worked out in a House-Senate conference committee. Cutting taxes is in the Republican comfort zone. Reforming the tax code is not. Full story.

LOBBYING FIRM ACTED AS TILLIS, McCRORY FUNDRAISING CONDUIT: The giving by the sweepstakes industry also puts a spotlight on fundraising efforts organized by McGuireWoods. Multiple contributions from sweepstakes operators were often recorded on the same days, with the largest group coming on May 16, 2012, when the Tillis campaign tallied a total of $60,002 from 19 individuals. Days earlier, on May 10, McGuireWoods held a fundraiser at its Raleigh office attended by Payne and lobbyists from other organizations. Harry Kaplan, a McGuireWoods lobbyist, said he invited clients who were interested in meeting with Tillis to talk about the issues they represented. They could also make campaign contributions, which some did, he said.

***More on Tillis, McCrory campaign fundraising, the sweepstakes industry and questions clouding the N.C. Rural Center and top Republicans below in the Dome Morning Memo.***

OBAMA VISIT: President Barack Obama is expected to unveil a plan to connect nearly every U.S. classroom to high-speed Internet while he’s in Mooresville on Thursday. The plan would expand broadband and wireless access to 99 percent of the country’s schools over the next five years, the White House said. It would use money already budgeted and would not require authorization or approval by Congress. The goal is to boost graduation rates and turn out students more prepared for tech-related careers. Full story here.

Gov. Pat McCrory won't be joining the president at his visit, according to his public schedule.

TAX DEAL BROKERED: For the second straight day Wednesday, House Republicans feuded among themselves on a major tax cut measure, stalling a top legislative priority. But 10 hours after a revolt in a morning committee meeting, House GOP lawmakers emerged from a lengthy closed-door meeting Wednesday evening to say they had reached a consensus to remove language from the tax bill aimed at helping the housing industry. The move puts the House tax plan back roughly in its original form. Full story.

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THREE QUESTIONS FOR THOM TILLIS: House Speaker Thom Tillis' decision to formally enter the Senate race and challenge Democrat U.S. Sen. Kay Hagan is not a surprise. But the timing, coming before the end of the legislative session, when Tillis said in January he would make a decision, is noteworthy. Here are three more questions about the race:

1. How long will he remain speaker? Running for the U.S. Senate is no state legislative race. It's all consuming. Does Tillis think he can manage an unruly House that is to his ideological right while campaigning? The case for staying in office: it helps to control the purse strings when you are asking for money. His allied super PAC, by coincidence or not, debuted when the House received the budget from the Senate. The case for resigning: Why have everything the Rep. Brawley's of the world propose drag you into issue fights you don't want?

2. Who will challenge him from the right? Tillis' debuted his run with an AP interview in which he emphasized his ability to work across the aisle -- a common message, but rarely heard in the primary stage of a campaign when you are appealing the fieriest partisans of your party. But it underscores Tillis' moderate tendencies and how Tillis could easily face a big-name challenger who is considered more conservative. The field could get crowded -- and Tillis isn't polling well in GOP primary surveys because he's largely unknown, despite his powerful post.

3. What will Phil Berger do? The possibility that Senate leader Phil Berger could enter the race -- and move to Tillis' right -- would add a whole new dynamic to the Republican primary field as two legislative leaders govern the state by their future ambition. It sounds less likely that he will run but even if he doesn't run, Berger can exert considerable influence if Tillis remains in the legislature by steering legislation that forces him to take positions on issues he may rather avoid.

***Read more on Tillis' Senate bid and Gov. Pat McCrory's step into the tax debate for the first time -- all below in the Dome Morning Memo, the source for North Carolina political news and analysis. ***

SECRETARY TO PITCH COMMERCE PRIVATIZATION PLAN: Commerce Secretary Sharon Decker will appear before a House panel Wednesday to pitch Gov. Pat McCrory's plan to privatize elements of the state's economic recruitment effort. Decker sent a memo to lawmakers with the talking points about the N.C. Economic Development Corporation a day earlier. She highlighted the efficiencies that McCrory's administration believes will be realized by consolidating various existing entities, including the N.C. Rural Economic Development Center, some of the N.C. Biotechnology Center and the tourism and film offices, among others, in a private nonprofit entity led by political appointees. She will describe a phase-in approach in her testimony. McCrory's team drafted the outline for the private-public partnership -- funded mostly by taxpayer dollars -- before he ever took office. Tony Almeida, the governor's top economic adviser who will lead the effort, wrote a white paper, finalized in December, as a member of McCrory's transition team that laid out the vision. (More below.)

DUELING TAX CAMPAIGNS: Americans for Prosperity began airing a TV ad on cable and broadcast that touts Republican leaders commitment to a tax overhaul. Meanwhile, the Young Democrats will debut an effort Wednesday to criticize the Senate plan with a web ad highlighting the hike in grocery taxes and and a new website nctaxhike.com, which is designed to counter Senate Republicans nctaxcut.com. Check Dome later today to see both.

***More North Carolina political news below in the Dome Morning Memo -- including a rundown on the day's top stories.

WILL THE STATE BUDGET FINISH IN TIME? As the House begins crafting its own state budget this week, the phrase "continuing resolution" is being heard more frequently in the hallways at the statehouse. The idea is this: with the Senate's budget delay, will the House finish writing its own in time to get it approved before the end of the fiscal year June 30? And if it gets close, and House and Senate budget writers are still deadlocked in conference, will they need to find an escape plan to keep government running? House budget writer Nelson Dollar dismissed the talk in an interview last week, but House Democrats are openly discussing the possibility. "I don't see how it's going to be avoided," said Rep. Mickey Michaux, a veteran Democrat. The state budget negotiations this year are complicated by House and Senate Republican leaders' attempts to imbed a tax overhaul that cuts government spending into the state budget, especially because the two chambers are so widely split on the issue.

TODAY AT THE STATEHOUSE: With money on the table, a strong lobbying presence is expected this week. A group of physicians will make the rounds Tuesday asking the House to put money in the state budget to pay for youth tobacco use prevention. House budget committees begin meeting at 8:30 a.m. Another House panel will consider the new school vouchers bill at 10 a.m. and a transportation committee will hear a ferry toll bill at noon. The House convenes at 1 p.m. but there are no bills on the calendar. The Senate convenes at 4 p.m. but will also hold a skeletal session with no action expected. Gov. Pat McCrory plays Mayor Pat again Tuesday morning in Charlotte, speaking to the local rotary club. Elsewhere, U.S. Sen. Kay Hagan will honor military spouses at an even in Fayetteville.

***Read more Dome Morning Memo below to get a roundup of North Carolina political news from the holiday weekend. ***

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."

***A busy week means lots of news below in the Dome Morning Memo. Send more news and tips to dome@newsobserver.com. ****

FIRST LADY BACKS BILL TO REGULATE PUPPY MILLS: Venturing into public policy for the first time as First Lady, Ann McCrory issued an open letter to lawmakers supporting House Bill 930 to establish standards for dog breeders. The bill is a weakened version of the original legislation which sought to crack down on puppy mills. "| am writing to thank you for your unanimous support of l-louse Bill 930. Passing legislation to establish basic standards of care for large commercial dog breeding facilities is a very important issue to me, and to people across our state," Ann McCrory wrote in the letter. "| especially wish to Representatives Saine, McGrady and Brown for their leadership on this issue. l hope you and other members of the General Assembly will continue to advocate for this bill, and other legislation establishing higher standards for Commercial breeders. These policies increase our quality of life in North Carolina and ensure better care for dogs across the state. You have my full support."

TODAY AT THE STATEHOUSE: A House committee will consider a Taxpayer Bill of Rights measure, known as TABOR, that would restrict state spending. Its hugely controversial and produced varied results. Other legislative committees will consider trimming environmental regulations and altering rules governing midwifery. On the Senate floor, lawmakers will hear a bill to prevent undercover whistleblower operations at farms and processing plants. And in the House, a bill about cancer drugs that split Republicans faces another vote, as does the LEED certification bill. Gov. Pat McCrory lists no public events.

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ENERGY COMPANY THWARTS FRACKING RULE: After more than six months of congenial meetings, the N.C. Mining & Energy Commission was set to approve its first fracking rule Friday, perhaps the most important of all the safety rules the commission will write to protect the public and safeguard the environment. The standard spells out which chemicals fracking operators have to publicly disclose when drilling natural gas wells in North Carolina.

But commissioners learned Thursday the proposal they had approved in committee in March is on ice. The problem: Fracking giant Halliburton has told North Carolina’s environmental regulators the rule goes too far. The N.C. Department of Environment and Natural Resources is working to get the rule changed.

The developments raise questions about the independence and integrity of the Mining & Energy Commission, a panel created by the state legislature last year to create safety rules for shale gas exploration. Fracking refers to fracturing shale rock formations using high-pressure water and chemicals to release the natural gas trapped inside. Full story.

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TILLIS SAYS LOBBYIST GIFT BAN WILL REMAIN INTACT: House Speaker Thom Tillis took to Twitter this week to declare Republican Robert Brawley's bill to lift the ban on lobbyists giving lawmakers gifts is dead. "Benny, does the fact that the bill is dead give you any idea?" @thomtillis wrote. The speaker's office confirmed the 10:10 p.m. Tuesday tweet was legit. Tillis addressed the response to Benjamin Ray, an operative at the N.C. Democratic Party pushing Tillis on the issue and tying it to his office's controversial past with lobbyists and the fact the bill came from one of his committee chairman.

MOTIVE FOR JAMIE HAHN'S STABBING TURNS TO CAMPAIGN MONEY: As the Triangle mourned slain political strategist Jamie Hahn on Wednesday, attention turned to whether the man who police say stabbed her had made questionable campaign finance reports while working for Hahn’s firm. More on the story below.

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TODAY AT THE STATEHOUSE: In a metaphor for this legislative session, the Senate is moving fast to raise the speed limit to 75 mph on some highways. The full Senate is scheduled to hear the bill Thursday, a day after it passed a committee and a week after it was filed, AP reports. The Carolina Panthers incentives bill also won approval in committee Wednesday and heads to the floor. Senate convenes at 10 a.m. The House is expecting a longer-than-normal day with a busy calendar, including a measure to limit the N.C. Lottery's ability to advertise and sell games. It starts at 1 p.m. Earlier in the day, House committees will consider a wind energy bill and IT changes requested by the McCrory adminsitration.

Gov. Pat McCrory will attend the UNC system Board of Governors meeting in Pembroke -- where he will surely face questions about the budget cuts he proposed -- before making an economic development announcement in the area.

HOW WILL GOP REACT? As AP reports, an American-Islamic group wants national Republican leaders to repudiate comments by a North Carolina legislator who compared Muslim prayer to terrorism. The Council on American-Islamic Relations said Wednesday that bigoted comments must be rejected if the GOP wants to reach minorities. State Rep. Michele Presnell of Yancey County did not respond to messages seeking comment.

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