Easley urges Democrats to scrap tax relief

Gov. Mike Easley, seeking cost savings to head off a potential revenue shortfall in the coming fiscal year, urged Democratic legislative leaders Friday to consider scrapping some agreed-upon tax relief and spend less on state employee salaries.

The governor's appeal to fellow Democrats came a day after he warned lawmakers that tax collections would probably be $70 million less than projected last month when the current fiscal year ends Tuesday.

House and Senate Democrats worked until after 3 a.m. Friday before going home without a final agreement on their $21 billion spending plan. They are scheduled to return Sunday morning.

House legislative leaders were skeptical Thursday about the impact the $70 million adjustment would have on the coming year's budget. Easley had suggested lawmakers look for an additional $45 million in savings for the new fiscal year, which continues through June 2009.

A final bill likely won't get to Easley's desk before the new fiscal year begins Tuesday.