While many legislators' pet projects and pork-barrel prerogatives such as a pharmacy program at Elizabeth City State University that was pushed by Senate President Pro Tem Marc Basnight, D-Dare, had to be put on hold to squeeze every available dime from the budget, others remained intact.
For example, after much spirited debate, legislators voted to leave UNC-system overhead receipts, the vast majority of which go to UNC-Chapel Hill, untouched. Overhead receipts are funds the federal government gives to universities along with research grants to cover indirect costs of doing research such as electricity, building maintenance and other administrative expenses.
However, many of the items overhead receipts pay for are also provided for by the state. Prior to 1999, the General Assembly required that a portion of these overhead receipts be returned to the state so that universities would not receive double funding for these expenses. This practice only made good sense. Why should the taxpayers have to pay for the same thing twice?
Some legislators were thinking the same thing this summer as they looked to previously untouched pots of money to make ends meet. But when they tried to revert to the pre-1999 practice of reclaiming a portion of the overhead receipts, UNC-system administrators cried foul. They argued that although overhead receipts often do fund things already provided for by the state, the excess money is used for other things such as recruiting new faculty and projects that bring more jobs and new technology to the state.
This assertion is often true. Sometimes the money is often put toward worthwhile uses.
However, figures from the Department of Fiscal Research at the General Assembly show that it is often misused as a slush fund by university administrators. Winston-Salem State University, for example, recently spent nearly $76,000 of its overhead receipts to search for a new chancellor. N.C. State University officials wanted to use the funds to offset any losses that might be incurred from a new hotel, golf course and conference center to be built on its campus.
UNC-CH administrators also spent money for non-research related purposes. Last year, for instance, the University purchased more than $22,000 on Amante's Gourmet Pizza with the funds.
In fact, UNC-CH administrators spent overhead receipts on a wide variety of less-than-worthy causes during the last two years, from nearly $500 for a conference on lesbian, gay, bisexual, transgender and queer youth to $24,871 worth of overseas trips for one law professor.
One of the biggest cheerleaders for leaving overhead receipt money alone was Sen. Howard Lee, D-Orange. That's not shocking given that he and Rep. Verla Insko, D-Orange, attended a reception paid for by overhead receipt money last year at George's Garage, a posh Durham restaurant. That event cost a cool $1,135.
