News-Record.com

Good Monday morning.

Budget negotiations broke up about 10 minutes or so before 11 p.m. Sunday night. House and Senate budget writers said they would be back in the morning to continue work on a final deal.

For those just tuning it: this is re: the $21.4 billion +/- state budget. Previous Sunday budget posts here and here..

According to Rep. Hugh Holliman and Sen. Tony Rand, the majority leaders in the House and Senate respectively, it is the education and capital portions of the budget remain unresolved. There are also "a few little items here and there" outstanding, said Holliman.

On education, both Rand and Holliman named the enrolment growth figure for the UNC system - how many new slots at university the state would underwrite - as one of the major unresolved issues. Left unmentioned was the teacher salary issues the governor was complaining about earlier in the day.

The capital section deals with what the state is going to build where for its universities and agencies. Although these will be state-owned buildings, legislators covet capital projects for their districts. And with little money for "special projects" - read: grants to nonprofits and the like - these capital items will be that much more sought after this year.

I asked Rand if there was any item upon which the two sides seemed intransigent, and couldn't think of one.

"You try not to get like that," he said.

So that's where things stand as the honorables go to sleep tonight.

(By the way, when I say budget negotiators were meeting, I mean the big chairs of the conference committee, not the cast of thousands that make up the full budget conference. But you knew that, right?)

There's also the possibility you will see a small budget continuation package pop up this week.

This isn't you're classic "continuing resolution" that the federal government seems to live off of and budget negotiators sometimes need in odd-numbered years. The budget passed in 2007 is a two year budget and will keep things going through June 30 of 2009, even if left unaltered.

But a couple folks knowledgeable about the process pointed to at least two sets of items that might need some legislative tweaking if a deal isn't done Monday or Tuesday:

• *One set is a group of federally-funded programs paid for through block-grants to the state. The legislature generally apportions these one year at a time. So even though there might be money sitting about from the feds, the state technically shouldn't spend it on anything. If memory and a quick check of last year's budget serve, there are a lot of these things in the Health and Human Service program area.

• *Items that were put under continuation review. "Continuation review" is legislative speak for "let's look and this and see if we're throwing money down a rat hole."

  Basically, once a program is made a "continuing" item in the budget, it appears over and over again until the honorables take some action to stop it. Putting an item on continuation review removes this "continuing" status and gives whatever the program is funding for one year while legislators kick the tires. Presumably if they look at something and don't like what they see, they simply drop the line item and whatever the program is goes away.

  One example of an item under continuation review from the 2007 budget is money county-level Juvenile Crime Prevention Councils. Now, these things are considered critical by folks working on anti-street gang measures and I haven't run into anyone who really thinks they're going to be de-funded this year. But, their state funding technically runs out at midnight July 1 unless the legislature does something to renew it.

There might be some way around doing this sort of mini-CR, particularly if a deal is imminent. And budget negotiators generally prefer that they focus on the main deal rather than little continuation bills. But if the lack of spending authority would throw a big monkey wrench in some particular set of works, don't be shocked to see a continuation bill come along.