June 12--RALEIGH -- House Republicans expressed concerns with their own $21.1 billion spending plan Wednesday, seeking to restore a handful of budget cuts, extend the film incentives and block the transfer of the State Bureau of Investigation.
The split among rank-and-file Republicans and GOP leaders generated a lengthy debate but did not stop two House committees from approving the budget proposal by solid margins.
The measure now moves to a full House vote Thursday with final approval expected Friday. The House and Senate will eventually need to strike a compromise between each chamber's budget proposal, which are vastly different in how they address key priorities.
The main difference is how the House and Senate pay for teacher pay hikes. The House budget would seek to generate greater lottery sales to pay for an average 5 percent hike while the Senate plan would cut other areas to provide an average 11 percent increase.
The teacher pay provision survived untouched in debate but it played a factor in other areas of the budget.
Republican leaders used it as justification in the House Finance Committee to reject an effort to extend the state's film incentives program.
Wilmington Republican Rep. Ted Davis proposed an amendment to the state budget to extend the tax breaks for movie and TV production companies to 2017 at a lower level and with a tighter cap.
He said it would keep the state as a top-tier filming location and preserve thousands of jobs.
"We likely won't see any more blockbuster films made in North Carolina but we can ensure the (future) of a film industry," he said.
But Rep. Mike Hager, a Rutherfordton Republican and House GOP whip, argued against the tax incentives saying the higher priority was teacher pay hikes and education.
"Are we going to spend it on film tax credits or are we going to spend it on the most important thing, education?" he asked. "I want to put this money back in the classroom and pay teachers a little more."
Davis warned that if the film incentives issues doesn't make it into the House budget -- it's not in the Senate proposal -- that it is dead for the year. He said a separate Senate bill to make the film incentives a smaller grant program is a non-starter. "You might as well just kill the film industry," he said.
Later in the House Appropriations Committee, Republicans also split on a measure concerning the transfer of the SBI out of Attorney General Roy Cooper's purview and into the Gov. Pat McCrory's administration as part of the Department of Public Safety.
The Senate and House budgets make the transfer, but Rep. Sarah Stevens, a Mt. Airy Republican, wanted to remove it.
"They need the independence and don't want to feel like they are a part of the Department of Public Safety, where those are a lot of times the people they come investigate," she said.
Republican Rep. Michael Speciale said he is concerned that the budget would transfer multiple agencies to the department's control. "It's making me nervous because I believe we are building a little fiefdom there, a little kingdom," the New Bern lawmaker said.
Smithfield Rep. Leo Daughtry, a Republican budget writer, defended the move, saying protections are built into the bill to make it independent, such as eight-year terms for the director and appointment approval from the legislature.
"I believe it's as independent as it's ever been," he said.
Against the objections of Republicans leaders, other changes to the budget included: restoring family court, which was eliminated in the House budget; extending tax credits for the renovation of historic buildings, which was set to expire; restoring $3 million to revive the Teaching Fellows, a program to train teachers; and adding a new position to help underutilized businesses, an effort backed by the governor.
Earlier in the day, Republicans rejected an attempt by Democrats to renew the earned income tax credit to help low-income workers. The tax break ended a year ago when Republicans declined to extend it as part of a tax overhaul.
All the changes left House budget writers frustrated at one point. "We have a budget process around here," said an exasperated Rep. Hugh Blackwell, a Valdese Republican who serves as a vice-chairman of the Appropriations Committee.
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