NC House budget tweaked to address energy credits, UNC funds

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RALEIGH, N.C. (AP) — House Republicans tweaked their North Carolina government budget proposal anew Wednesday to address renewable energy tax credits and increase university funding, bidding to pick up more support for the two-year spending plan.

The changes, particularly on a compromise extending tax breaks for two more years on solar, wind and similar projects, could ease skepticism from lawmakers on both sides of the political spectrum. Conservative advocacy groups have urged Republicans to reject the budget proposal as a spending binge that gives out too many incentives to specific industries.

Debate and the first of two required votes on the budget had been scheduled to begin Wednesday night. But it got delayed until Thursday morning to give more time to research staff to draw up amendments for Democrats and Republicans, said Rep. David Lewis, the House Rules Committee chairman. The decision means the House likely will hold an unusual Friday session for the second vote.

The delay also may give more time to undecided GOP lawmakers unhappy with portions of the bill about how to vote.

Some are unhappy with the extension of tax incentives in the plan and $120 million over two years in grants to attract TV and movie production projects. The current year's budget provided only $10 million in grants for six months.

Overall, the plan spends nearly $22.2 billion next year compared to the current year, an increase of more than 5 percent.

"It spends a lot of money and it spends a lot on things maybe we don't need to spend it on," said Rep. Dana Bumgardner, R-Gaston, who didn't know how he was going to vote.

Lewis, R-Harnett, said earlier Wednesday he was confident the budget would still have passed without the changes made in his committee. But "we think the more votes we get, obviously the stronger our negotiating with the Senate" after the other chamber passed its version of the budget, Lewis said. The two chambers want a final budget to GOP Gov. Pat McCrory before the new fiscal year begins July 1.

The state chapter of Americans for Prosperity said it began running a radio ad opposing the film grant increase, while Civitas Action said a vote for the budget would reflect negatively upon a lawmaker's score on the group's legislative scorecard.

And Raleigh businessman Bob Luddy, a donor to conservative causes, wrote House Republicans on Tuesday telling them $25,000 that he had planned to donate to the chamber's GOP political arm for the 2016 elections would now go to Americans for Prosperity instead "to fight the liberal House spending plan."

"We now find that based on the Republican budget, special interests such as film producers, non-competitive solar energy manufacturers and out-of-state companies are favored over hard-working taxpayers and North Carolina businesses," Luddy wrote.

Lewis said the spending plan "is a responsible budget" and expected bipartisan support for it.

"We listen carefully to interest groups from both sides, but in the end it's our responsibility to (put) together a package and be able to govern," Lewis said.

The amendment on the renewable energy tax credit sought to assuage Republicans unhappy with an earlier proposal to extend the credit through 2017 for solar and 2019 for other alternative power sources. All the credits otherwise expire at the end of December. Now all will be extended through 2017, while the actual credit would fall from 35 percent of a property's cost to 20 percent.

An amendment also eliminated $40 million in proposed reductions for the University of North Carolina system, including the deletion of a limit on what public funds campuses can be used for fundraising.

To make up for the lost UNC savings, a proposed venture capital initiative sought by McCrory would now be paid for from the unclaimed property fund held by the State Treasurer, not taxpayer funds. Critics of state incentives nearly defeated the amendment, however.

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