The following editorial appeared in the April 2011 issue of Carolina Journal.

RALEIGH — Outgoing Senate President Pro Tem Marc Basnight got a nifty retirement present from the state Department of Transportation: $350,000 in taxpayer funding to upgrade a private tourist attraction and event facility near his Manteo home.

The DOT’s engineers, managers, and board OK’d the money to improve walkways and install lighting at the Elizabethan Gardens — a 10-acre parcel near the “Lost Colony” Waterfront Theatre. The upgrades will improve access to the formal gardens and make it easier for the operators of the (again, private) facility to book weddings and other functions. The board gave final approval to the project in early February, after Basnight left his Senate seat.

As Don Carrington notes in the April 2011 Carolina Journal, DOT’s approval was a mere formality, as the money came from a “contingency fund” that is divided equally among the transportation secretary, the speaker of the House, and the Senate president pro tem. The discretionary fund — currently $15 million a year — has existed for more than two decades, and legislative leaders can tap it for any purpose at any time.

It’s not much different from the other slush funds Don identified in 1997 and 2005, also controlled by Basnight and his House counterparts. In those cases, money was set aside in the budget for legislative leaders to tap at their discretion. The earlier slush funds were carved out of the state’s General Fund, where several executive branch agencies maintained the accounts. When media reports exposed the funds, they were abandoned. The current Contingency Fund is assigned to DOT; the transportation secretary keeps tabs on it and writes checks for the legislative leadership.

Meantime, more than $16 million in transportation projects that have been targeted by DOT as legitimate safety priorities — including dangerous intersections and narrow traffic lanes that place motorists and pedestrians in peril — languish without funding.

Unfortunately, the new GOP leaders have failed to acknowledge the sleazy nature of the Contingency Fund. Basnight’s successor, Sen. Phil Berger, R-Rockingham, approved a $24,000 grant for improvements on a private rural dirt road. DOT engineers had reviewed the project and decided it didn’t meet their guidelines for full funding. Berger fast-tracked it anyway.

This setup does not appear in any civics textbook. After all, the North Carolina Constitution states that the “legislative, executive, and supreme judicial powers of the state government shall be forever separate and distinct from each other,” and that the “budget as enacted by the General Assembly shall be administered by the Governor.”

Making matters more bizarre, an Advisory Opinion from the attorney general’s office in 2005 noted that the discretionary funds do not violate separation of powers because the diversion of money was informal. No law gave Basnight or his counterparts control of the funding. The arrangement was made with a nod and a handshake.

Gov. Bev Perdue should stop the sleaze. She needs to instruct Transportation Secretary Gene Conti to stop maintaining checking accounts for legislative leaders. And do it soon.