A BILL TO BE ENTITLED
AN ACT to enact the balanced budget act of 2011.
The General Assembly of North Carolina enacts:

Title of Act
SECTION 1.  This act shall be known as the "Balanced Budget Act of 2011."

authority for the governor to reduce expenditures
SECTION 2.  Notwithstanding the State Budget Act or any other provision of law, the Director of the Budget is authorized to take all actions necessary to reduce General Fund expenditures for the remainder of fiscal year 2010‑2011. This grant of authority includes all powers to balance the budget granted the Governor under Article III, Section 5 of the Constitution. For the remainder of the 2010‑2011 fiscal year, the Director of the Budget shall exercise these powers with a goal of reducing recurring expenditures by at least four hundred million dollars ($400,000,000).

Changes to the 2010‑2011 availability statement
SECTION 3.  Section 2.2(a) of S.L. 2010‑31 reads as rewritten:
"SECTION 2.2.(a)  Section 2.2(a) of S.L. 2009‑451 is repealed. The General Fund availability used in adjusting the 2010‑2011 budget is shown below:

				FY 2010‑2011

Unappropriated Balance Remaining from Previous Year	3,702,182
Adjustment from Estimated to Actual FY 2009‑2010 Beginning Unreserved
	Fund Balance	270,080
Beginning Unreserved Fund Balance	3,972,262

Revenues Based on Existing Tax Structure	18,199,339,016

Nontax Revenues	
	Investment Income	57,500,000
	Judicial Fees	239,100,000
	Disproportionate Share	100,000,000
	Insurance	67,000,000
	Other Nontax Revenues	182,700,000
	Highway Trust Fund/Use Tax Reimbursement Transfer	72,800,000
	Highway Fund Transfer	17,600,000
Subtotal Nontax Revenues	736,700,000

Total General Fund Availability	18,940,011,278

Adjustments to Availability	
	Internal Revenue Code Conformity	(7,700,000)
	Unemployment Insurance Refundable Tax Credit	(34,100,000)
	Increase Sales Tax Prepayment Threshold	(7,000,000)
	Relieve Annual Report Compliance Burden on Small Businesses	(400,000)
	Fair Tax Penalties	0
	Extend Sunsets on Various Tax Incentives	(3,500,000)
	Improve Tax and Debt Collection Process	3,000,000
	Modernize Sales Tax on Accommodations	1,700,000
	Modernize Admissions Tax and Restore Amenities Exclusion	(700,000)
	Reserve for Pending Finance Legislation	(9,800,000)
	Reduce Franchise Tax Burden on Construction Companies	(1,500,000)
	Department of Revenue Settlement Initiative	110,000,000
	Disproportionate Share	35,000,000
	Loss of Estate Tax Revenues for FY 2010‑2011	(85,000,000)
	Increase Justice and Public Safety Fees	13,930,670
	Transfer from the Health and Wellness Trust Fund	
				17,045,800
Transfer Aviation from Department of Commerce to Department
	of Transportation	(500,000)
	Transfer from Wildlife Resources Commission	
				8,000,000
	Divert Funds from Scrap Tire Disposal Account	2,500,000
	Divert Funds from White Goods Fund	1,200,000
	Transfer from Mercury Pollution Prevention Fund	2,250,000
	Transfer from Bladen Lakes Special Fund	150,000
	Transfer from DACS – N.C. State Fair	1,000,000
	Transfer from ECU Magnetic Resonance Imaging Lease and Equipment
		Fund	1,000,000
	Adjust Transfer from Insurance Regulatory Fund	(2,176,454)
	Transfer from Motorfleet Internal Services Fund	14,000,000
	Transfer from Golden LEAF Funds	67,563,760
	Transfer from Tobacco Trust Fund	2,800,000
	
	Various Budget Fund Transfers to General Fund
	Budget Fund
	Code		Code	Description
	24667			Information Technology Fund		1,000,000
	74660			Information Technology Internal Service Fund		7,586,800
	24669			ITS Wireless Fund		5,000,000
	74500	7100		Correction Enterprise Fund		3,000,000
	24609	2560		One North Carolina Fund		5,208,333
					Department of Agriculture & Consumer Services (various						special funds)		1,500,000
	63702	6208		Farmland Preservation Trust Fund		1,800,000
	54600	5881		Alcoholic Beverage Control Commission Fund		950,000
	24609	2567		Industrial Development Utility		2,500,000
	19944			Job Development Investment Grants (JDIG)		3,000,000
	24300	2911		SWC CREP/Expansion		500,000
	24300	2865		Aquariums Special Fund		1,500,000
	24309	2235		Parks and Recreation Trust Fund		8,500,000
	24611	2200		Industrial Commission – IT Projects Fund		1,000,000
	24100	2514		E‑Commerce Reserve		4,630,891

Subtotal Adjustments to Availability	176,439,800

Revised General Fund Availability	19,116,451,078
Less General Fund Appropriations	18,958,994,212

Balance Remaining	157,456,866"

REVERSIONS TO THE GENERAL FUND
SECTION 3.1.(a)  Effective June 30, 2011, the following amounts are reverted to the General Fund:

Code	Code		Description
11000	1900		General Assembly Reserve		1,901,522
13085	1900		Department of Insurance Reserve		1,150,693
SECTION 3.1.(b)  G.S. 143C-1-2(b) does not apply to the reversion from the General Assembly Reserve in subsection (a) of this section.

TRANSFER GOLDEN LEAF FUNDS
SECTION 4.(a)  Pursuant to Section 2(b) of S.L. 1999‑2, the fifty percent (50%) of the 2011 annual installment payment to the North Carolina State Specific Account that would have been transferred to The Golden L.E.A.F. (Long‑Term Economic Advancement Foundation), Inc., is transferred to a General Fund account within the Settlement Reserve Fund to be used to support General Fund appropriations for the 2010‑2011 fiscal year.  The Attorney General shall take all necessary actions to notify the court in the action entitled State of North Carolina v. Philip Morris Incorporated, et al., 98 CVS 14377, in the General Court of Justice, Superior Court Division, Wake County, North Carolina, and the administrators of the State Specific Account established under the Master Settlement Agreement of this action by the General Assembly redirecting the payment set forth in this section.
SECTION 4.(b)  A General Fund Account is established in the Settlement Reserve Fund.  In 2011, the portion of the Master Settlement Agreement payment identified in Section 6(1) of S.L. 1999‑2 shall be credited to the General Fund Account. The State Controller shall transfer all funds in the General Fund Account to the General Fund.
SECTION 4.(c)  Funds transferred from the General Fund Account to the General Fund shall be deposited in Nontax Budget Code 19978 (Intrastate Transfers) to support General Fund appropriations for the 2010‑2011 fiscal year.

TRANSFER health and wellness trust funds
SECTION 5.  Section 2.2(i) of S.L. 2009‑451, as rewritten by Section 2.2(f) of S.L. 2010‑31, reads as rewritten:
"SECTION 2.2.(i)  Notwithstanding G.S. 143C‑9‑3, of the funds credited to the Health Trust Account, the sum of twenty‑two million forty‑five thousand eight hundred dollars ($22,045,800) that would otherwise be deposited in the Fund Reserve shall be transferred from the Department of State Treasurer, Budget Code 23460 (Health and Wellness Trust Fund), to the State Controller to be deposited in Nontax Budget Code 19978 (Intrastate Transfers) to support General Fund appropriations for the 2010‑2011 fiscal year. These funds shall be transferred on or after April 30, 2010."

TRANSFER tobacco trust funds
SECTION 6.  Section 2.2(h) of S.L. 2009‑451, as rewritten by Section 2.2(i) of S.L. 2010‑31, reads as rewritten:
"SECTION 2.2.(h) Notwithstanding G.S. 143C‑9‑3, of the funds credited to the Tobacco Trust, the sum of seven million eight hundred thousand dollars ($7,800,000) shall be transferred from the Department of Agriculture and Consumer Services, Budget Code 23703 (Tobacco Trust Fund), to the State Controller to be deposited in Nontax Budget Code 19978 (Intrastate Transfers) to support General Fund appropriations for the 2010‑2011 fiscal year. These funds shall be transferred on or after April 30, 2011."

transfer from the industrial commission – IT fund
SECTION 6.1.  Section 14.15 of S.L. 2009‑451 reads as rewritten:
"SECTION 14.15.  For the 2010-2011 fiscal year, the North Carolina Industrial Commission may retain all overrealized receipts. These funds shall be used for the purpose of replacing existing computer hardware and software used for the operations of the Commission. These funds may also be used to prepare any assessment of hardware and software needs prior to purchase and to develop and administer the needed databases and new Electronic Case Management System, including the establishment of two time‑limited positions for application development and support and mainframe migration. "

EFFECTIVE DATE
SECTION 7.  This act is effective when it becomes law and applies to fiscal year 2010‑2011 only.