THE VIRGINIAN-PILOT

                         THE VIRGINIAN-PILOT
                 Copyright (c) 1994, Landmark Communications, Inc.

DATE: SATURDAY, June 25, 1994                    TAG: 9406250251 
SECTION: LOCAL                     PAGE: B1    EDITION: NORTH CAROLINA  
SOURCE: BY BETTY MITCHELL GRAY, STAFF WRITER 
DATELINE: 940625                                 LENGTH: RALEIGH 

HOUSE, SENATE READY TO HAMMER OUT BUDGETS \

{LEAD} Albemarle-area legislators will begin squaring off with legislators from other parts of the state next week as the House and Senate step-up the debate over how to spend about $1.2 billion.

More than $28 million in appropriations for new programs and new building projects for northeastern North Carolina will be at stake as House and Senate leaders begin the long process of seeking a compromise between their two budget proposals.

{REST} Just as the Senate budget, approved nearly three weeks ago, contains little spending for projects west of Interstate 77, home turf for the House budget leaders, the House plan approved earlier this week deletes as expected spending for most projects in northeastern North Carolina, Senate leader Marc Basnight's home turf.

House Speaker Dan Blue had predicted that little money would be devoted to individual projects and would be spent on programs designed to ``move North Carolina forward.''

``The choice was between bricks and mortar or public schools,'' Blue told reporters. ``We chose to go with schools rather than those bricks-and-mortar programs.''

Basnight said: ``If you can call spending for East Carolina University, the Center for the Sounds and the Elizabeth II `pork,' then I would call $30 million for a natural science museum and Raleigh visitors center `pork.' ''

``I think eastern North Carolina deserves its proportionate share,'' he said Thursday.

The House plan spends about $200 million more than the Senate proposal.

Part of that extra money came from shifting funds within the existing two-year budget.

The House also directs Hunt to cut $10 million in vacant state positions from the payroll by August, a move which was criticized almost immediately by Senate leaders who met Thursday and Friday in Raleigh to review the differences between the House and Senate budgets.

The Senate budget includes smaller pay raises for state employees than the House budget and also includes $152 million for construction projects, renovations and equipment purchases that were generally stripped from the House budget.

Before the ink was dry on either plan, critics surfaced to deride each chamber.

Less than a week after the Senate approved its plan, Bobby Etheridge, the state school superintendent, criticized the chamber for adopting a budget package that included too much money for pork barrel projects and neglected the state's schoolchildren.

The House budget also has its detractors. State Treasurer Harlan Boyles said Thursday that adopting a House proposal to cut North Carolina's contribution to its employee retirement system by $10.3 million next year would set a dangerous precedent.

Among the battles looming for budget writers that will affect northeastern North Carolina include appropriations for the Basic Education Program, the Division of Marine Fisheries, Smart Start and a variety of special projects:

Basic Education Plan. The House plan spends more than $55 million for the BEP, created in 1985 to improve schools. The House budget would reduce class size for kindergarten and the 10th grade and would devote $10 million to hire support personnel for kindergarten through eighth grades.

The Senate budget contains no money for the BEP and instead spends $7 million in supplemental money for the state's poor school systems and $3 million for small school systems. Of 16 northeastern North Carolina school systems, all but Dare County schools qualify for either poor or small school supplements, or both.

Smart Start. The House spends $16.4 million to expand the preschool program to 12 new counties and another $6 million for state-subsidized day care programs. The Senate devotes $26.1 million to expand the program to 12 new counties and give additional money to the existing 12 programs.

Halifax County is the sole northeastern North Carolina county chosen as one of the original participants in the Smart-Start program but leaders in other area counties have said they would like to join the program if money were available.

Division of Marine Fisheries. The House allocates $1.1 million to the division for biological, technical and law enforcement staff to comply with the Atlantic States Marine Fisheries Commission management plans. This allotment matches Gov. James B. Hunt's budget request for the division and has the support of many fishermen and fisheries regulators.

The Senate devotes the bulk of its $1.5 million fisheries budget to grants to test new equipment, conduct industry research and other fisheries studies and to a crab research office in Tyrrell County, pet projects of the Senate leadership. The Senate budget also includes money for a blue ribbon advisory council on oysters, among other appropriations.

Construction spending and other special projects. The Senate budget contains about $152 million for capital spending, about $31.8 million of which was designated for projects in northeastern North Carolina, including improvements at the Elizabeth II state historic site, construction of an agricultural center in Martin County a 4-H center in the Northeast and construction at East Carolina University. The Senate budget also includes money for a variety of special projects in the Albemarle-area including just over $3 million for the Partnership for the Sounds, a four-county eco-tourism project, and $800,000 for the Graveyard of the Atlantic.

The House budget deletes most of this spending and includes $30.9 million for a new state Natural Science Museum in Raleigh and $430,000 to plan a new government visitor center.

The House budget includes about $500,000 for construction and staff positions at the Tideland Research Center near Plymouth, a long-time project of Rep. Vernon James, D-Pasquotank.

James predicted Thursday that the final budget will be fair for all sections of the state.

``I think the east and the west will probably balance out in good shape,'' James said in an interview from his office in Raleigh. ``The west has good representation and the east has good representation in Marc Basnight, (Sen.) Bob Martin, (Rep.) Gene Rogers and many others.

``I feel good about the way it will come out,'' he said.

The Senate will likely reject the House proposal after the Senate Appropriations Committee completes a review of the budget. Then a special committee will be appointed from members of both chambers to negotiate the differences in the two plans before the session ends.

Legislative leaders say those negotiations could take a while.

``It could take a month. It could take a week,'' said Basnight. ``I don't expect to get out too early.''

``It depends on the will of the people,'' he said.

by CNB