Republicans ditch efforts to expand legal gambling in North Carolina, will pass budget this week

North Carolina Republican legislative leaders ditched efforts this year to dramatically multiply legal gambling in the state, announcing Tuesday that they will instead pass a final budget without it that also will trigger Medicaid coverage to begin for hundreds of thousands of adults.

“We think this is the best, most prudent way for us to move forward,” Senate leader Phil Berger told reporters.

House and Senate GOP lawmakers had been grappling with how to get the votes necessary to authorize four new casinos and legitimize and regulate video gambling machines. A significant group of conservatives in the state House balked earlier this month at the idea from Senate Republicans to insert language expanding gambling into the two-year spending plan.

Then in recent days, there was talk of putting the gambling items in a bill separate from the budget and also require its passage for Medicaid expansion to finally occur. But that threatened a landmark health care deal that Democratic Gov. Roy Cooper had reached six months ago with GOP legislators, who had until recently been set against accepting expansion through the 2010 federal health care law.

Nearly all of Cooper's Democratic allies in the legislature wouldn't go along with the ploy, which with Republican holdouts threatened to stop the bill.

At a hastily arranged Legislative Building news conference that also included House Speaker Tim Moore, Berger said that efforts to advance these types of gambling were over for the immediate future.

Within the House Republican caucus, “clearly there were differences of opinion and at the end of the day we felt like this issue and no one single issue should hold up the budget,” Moore said.

Medicaid expansion is considered a top priority of Cooper and his legislative allies. Those lawmakers opposed the effort to link it with gambling, saying it broke the promise Republicans essentially made within an expansion law Cooper signed in March that stated enacting a budget law was required for expansion to start. And enough Republicans were still unhappy with the gambling efforts contained within to threaten to sink the measure.

Now, “Medicaid expansion will still be contingent on the budget becoming law,” Berger said.

Democrats and Christian conservatives celebrated their victory.

“For the last few days, House and Senate Dems have stood united against casinos and for Medicaid expansion,” Sen. Jay Chaudhuri, a Wake County Democrat, wrote in a social media post. “Today, we showed the state why Dems still matter.”

And John Rustin with the North Carolina Family Policy Council praised legislators “who stood their ground, under extreme pressure, to protect our state from the ravages of gambling, gambling addiction, and the predatory gambling industry.”

Moore and Berger said details of the negotiated final two-year spending plan would now be released Wednesday, with floor votes Thursday and Friday. They both anticipated full Republican support for the budget bill, with expected Democratic votes as well.

Republicans hold narrow veto-proof majorities in both chambers. The final budget, however, will carry right-leaning provisions that Cooper and many Democrats will find difficult to swallow.

A state budget was supposed to be in place when the new fiscal year began July 1, but negotiations slowed during the summer over the extent of income tax rate reductions and how to distribute billions of dollars for initiatives and programs.

North Carolina already has three casinos operated by the Eastern Band of Cherokee Indians and the Catawba Indian Nation. The gambling proposal would have created “rural tourism districts” where gambling venues and other development could have occurred.

While legislators have said three casinos could have been built in Anson, Nash and Rockingham counties, the language allowed other options. A fourth could have been operated by the Lumbee tribe.

Developers would have agreed at each location to generate at least 1,750 jobs and $500 million in private investment. And owners of the video gambling machines authorized in the proposal would have been licensed by the state lottery commission. Fiscal analyses by General Assembly staff estimated the state coffers would have benefitted by several hundred million dollars annually.

Berger, who is from Rockingham County, has been among the most consistent and vocal supporters of the rural casino districts, citing the success of a casino in nearby Danville, Virginia.

During Tuesday's news conference, Berger said people who talk up the need to improve rural economies opposed an effort that would have created over 5,000 good-paying jobs and increased local tax bases.

“It was just pretty clear that the facts were almost beside the point as to what those proposals would do for rural areas,” Berger said, adding that emotions had overtaken discussions. ”I’ve learned that in an environment like that, you’re unlikely to make any progress."