The Virginian-Pilot
                             THE VIRGINIAN-PILOT 
              Copyright (c) 1995, Landmark Communications, Inc.

DATE: Tuesday, January 17, 1995              TAG: 9501170316
SECTION: LOCAL                    PAGE: B3   EDITION: NORTH CAROLINA 
SOURCE: BY BETTY MITCHELL GRAY, STAFF WRITER 
DATELINE: RALEIGH                            LENGTH: Medium:   83 lines

AUSTERE BUDGET GETS A SECOND LOOK FROM STATE ADMINISTRATORS

Remember G-PAC? Well, it's back.

Gov. James B. Hunt Jr., other administration leaders, state lawmakers and a number of others are dusting off their copies of ``Our State, Our Future,'' the 112-page report by the state Government Performance Audit Committee. The committee is called G-PAC.

The extensive audit of government agencies, commissioned by the legislature four years ago, recommended about 450 changes in state government designed to save about $275 million in each of the first two fiscal years after they were approved and a total of $1.2 billion by the 10th year.

The audit was mandated by the General Assembly in 1991 after lawmakers, faced with a $1.2 billion deficit for 1991-93, cut the state budget by about $570 million and increased taxes about $640 million.

With great fanfare, a 27-member G-PAC - including legislators, businessmen and educators - was appointed to direct the audit work to try to find an additional 6 percent reduction in government spending. G-PAC made its recommendations at the start of the 1993 session.

Some of the audit's more controversial recommendations include:

A moratorium on construction of new community colleges.

Deferring the paving of infrequently used dirt roads under the Highway Trust Fund.

Closing about 30 of the state's smaller prisons.

Closing at least one state-owned school for the deaf.

Eliminating the Cabinet-level Department of Crime Control and Public Safety.

Many of the audit's recommendations were too politically hot to handle and were quietly dropped.

Some, such as the elimination of the Department of Crime Control and Public Safety, were killed before they could become part of G-PAC's final report.

``What was important about G-PAC was that it graphically showed that . . . the programs we currently have in existence will grow over the next 10 years beyond our ability to pay for them, and the solution is to either raise taxes or lower spending,'' said John Hood, vice president of the John Locke Foundation.

``The people who decided to ignore G-PAC are now sitting at home or they are sitting at the back of the House and Senate,''Hood said.

The General Assembly's new Republican majority and other conservative groups are re-examining G-PAC for possible savings.

``Some of them are very good,'' said Rep. Carolyn B. Russell, R-Wayne, House speaker-pro-tem elect. ``But we haven't decided on specifics.''

Some administration officials are also getting back into the G-PAC act: The board that oversees the state's schools for the deaf recently recommended the closure of the school in Greensboro as part of its budget-cutting efforts. And Hunt last week hinted that he would recommend disbanding Crime Control and Public Safety, the department his minions worked to save in 1992. ILLUSTRATION: G-PAC PROPOSED REDUCTIONS

In 1992, G-PAC, a committee made up of 27 legislators,

businessmen and educators considered over 400 changes in state

government that was expected to save about $275 million over the

first two years after they were enacted. The state's new Republican

leaders and others say it's time to re-evaluate the committee's

proposals. Here are some of the recommendations made to the

committee in 1992:

Eliminate the Department of Crime Control and Public Safety;

place its divisions within other departments; possible savings of

$2.4 million a year.

Impose a moratorium on building new community colleges and

satellite campuses.

Increase University of North Carolina tuition.

Close one of North Carolina's three schools for the deaf;

possible savings of $8.5 million over 10 years.

Close 30 small prisons in various counties including several in

eastern North Carolina; possible savings of $19 million a year.

Cut 123 Raleigh-based management jobs in the schools; possible

savings of $6 million a year.

Close 64 of the state's 197 driver's license offices, including

some in the Northeast; possible savings of $2.3 million a year.

Reduce the number of unpaved roads scheduled for paving under the

Highway $357 million reduction in Secondary Trust Fund.

by CNB