The legislative budget process gained momentum this week as the Senate has signaled with certainty that their version of the State Budget will be voted on next week.  Although no public meetings were held this week, key Senate budget writers were working to negotiate a tax and spending plan that could pass the chamber by April 9^th.  The House of Representatives approved a ban on smoking in most public places and places of employment, although amendments adopted by the House carved out additional exemptions from the legislation.  A House Committee continued work on legislation to return the State Health Plan to solvency this week, but progress has slowed as opponents to the legislation took their fight to TVs and newspapers across the state. 

All the signs are present that the State Senate is preparing to vote on a Senate version of the State Budget next week.  First, joint meetings of the House and Senate appropriations sub-committees ceased; an annual signal that the chambers have turned their attention to their respective budget priorities.  Next, key budget writers and leaders of the State Senate spent almost the entire week in meetings with the General Assembly's fiscal staff.  On Wednesday, the chairs of the Senate Finance Committee met with Governor Bev Perdue (D-Craven) in an apparent move to build support for their major tax reform proposal, details of which have yet to be released publicly.  On Thursday, the Insider news service quoted Senate Appropriations Committee co-Chair, Senator Linda Garrou (D-Forsyth), as confirming a plan to have Appropriations sub-Committees take up portions of the Senate version of the budget early next week.  Today, the News and Observer continued reporting on the Senate tax reform proposal and Senate Appropriations sub-Committees began scheduling their meetings to review portions of the budget plan. 

In the news this week, Senator Garrou acknowledged that the Senate was considering a plan to increase the class size in public schools by one or two students.  That change would save the state about $170 million next year.  Such a change would be reversal of past efforts that emphasized smaller classes to improve educational outcomes and is opposed by Governor Perdue.  Other differences with the Governor's recommended budget will likely appear in the tax portion of the budget.  Key Senate budget writers, including Garrou and Senator David Hoyle (D-Gaston) who is a Finance Committee Chair, say they are opposed to the Governor's proposal to raise taxes on cigarettes by $1 a pack.  Foregoing that extra income means Senate leaders will have to find even more additional revenue to cover the expected $2-$3 billion shortfall in the State Budget.  New taxes and a new tax structure may be the vehicle of choice to accomplish that.  Senator Dan Clodfelter (D-Mecklenburg) confirmed in news reports today that the Senate budget proposal will consist of major tax reforms including the taxation of services and a lowering of the existing corporate tax and income and sales taxes. 

In lengthy afternoon sessions on Wednesday and Thursday, the House advanced legislation (House Bill 2) that will ban smoking in most public places and places of employment.  Passage of the bill brings Majority Leader Hugh Holliman (D-Davidson) one step closer to achieving a goal that developed from his own survival of lung cancer.  Rep. Holliman successfully marshaled 72 votes for the bill's final passage after the adoption of five (5) amendments and the defeat of one.  The several amendments provide additional exceptions or clarifications to the bill, including an exemption for cigar bars and bars that only employ or serve persons over age 18.  Exemptions to allow smoking in private residences and vehicles, tobacco shops and in designated hotel rooms were already included in the bill.  Should the bill pass the Senate and become law under the Governor's signature, North Carolina would join a growing plurality of States in restricting public smoking.  However, North Carolina is still the nation's leading tobacco producing state, a fact that was not lost on lawmakers who supported additional exemptions or opposed the bill outright.  The bill now goes to the Senate where its prospects for passage seem likely. 

This week the debate over legislation to reform the State Health Plan (Senate Bill 287) continued inside the Legislative Building and one group opposed to the bill took to the airwaves in an attempt to slow down progress of the bill.  The State Employees Association of North Carolina (SEANC) has taken an increasingly aggressive stance against Senate Bill 287 because the bill includes increased premiums, deductibles and copays for dependants of workers covered under the plan.  SEANC began running a statewide advertising campaign to criticized not only the proposal itself, but also the Plan contract with Blue Cross Blue Shield, the State's largest insurer.  Blue Cross CEO Bob Greczyn was on hand to defend the company at a meeting of the House Insurance Committee Thursday.  Pressure from lawmakers and SEANC have forced Blue Cross to disclose the terms of the contract that were once exempted from the public records laws and brought scrutiny upon the relationship between the Plan and Blue Cross.  That scrutiny has targeted Mr. Greczyn personally and focused on Blue Cross's political contributions to several legislators who are influential in setting the parameters of Blue Cross's contract and the terms of the insurance plans offered.  Amendments to Senate Bill 287 that were adopted at the Insurance Committee meeting yesterday increased the total price tag of the legislation to $700 million.  Even as SEANC continued to ask legislators to consider delaying action on the changes, Insurance Committee members voted 9-7 to advance the legislation.  Senate Bill 287 now goes before the House Appropriations Committee for further review. 

In other action, the State Senate approved legislation that will require insurance for operators of mopeds (Senate Bill 135), extend the Global Climate Change Commission (Senate Bill 835), allow parties to administrative litigation to stipulate that an Office of Administrative Hearings ruling is a final decision (Senate Bill 633), and make technical changes to the NC Limited Liability Company Act (Senate Bill 412), among others.  In the House, work continued on various proposals, including a bill to require reporting of malpractice judgments and settlements by medical doctors (House Bill 703) and to make the second Saturday of September "North Carolina Hot Sauce Day" (House Bill 683).  Various other legislation and local bills were subject to action by the House or Senate this week.