A state auditor's review of roughly $14 million in reserve funds tucked into last year's state budget confirms that legislative leaders controlled the money that had been placed in three state agencies.

But the audit leaves the question of whether the spending was proper to the state attorney general.

"We trust the information provided will enable the Attorney General to consider and render legal opinion as deemed appropriate," State Auditor Les Merritt said in a letter to Attorney General Roy Cooper.

The 88-page report, released Thursday afternoon, found that lawmakers put the money into reserve funds in the budget during final negotiations that were not open to the public.

"The limited time in which the budget was finalized, printed and then voted on by the legislature limited budget transparency, especially as related to the Reserve Funds," the review said.

Nearly all of the money was allocated to nonprofits and governmental agencies. Auditors said they cannot determine whether the money was properly spent until the recipients provide annual reports.

The auditors said two of the three state agencies in which the funds were placed -- the Department of Cultural Resources and the Office of State Budget and Management -- had no plans to monitor the spending during the fiscal year.

Senate leader Marc Basnight received $6.5 million, House Speaker Jim Black $4.6 million and former Republican House Speaker Richard Morgan $2.9 million.

Roughly $1.2 million in the funds remains unspent.

Several government watchdogs and the state Republican Party have referred to the spending as slush funds that were especially egregious in a budget that cut education and health and human service pro- grams.

Nearly all the money went to projects at the request of favored lawmakers or candidates for legislative seats.

In addition, $45,000 went to create a state job for former Rep. Michael Decker of Forsyth County. Decker's switch from Republican to Democrat helped Black keep the speaker's post in 2003 and 2004.

The review found that Black's staff had helped create the position in Cultural Resources and tailored it to fit Decker's experience. Two other people were interviewed for the job, one of them by telephone.

Black didn't authorize the funding until Decker had the job. The funding ran out Thursday, and House and Senate leaders say they have included no money in their budget proposals to continue the position.

Black, Morgan and Basnight have all said the projects were worthy of state money.

But some of the money went to entities that had no plan for how to spend it, and some lawmakers requested money for nonprofits for which they serve as board members.

Legislative leaders' written responses to the review ranged from apologetic to a short acknowledgement.

Basnight, a Manteo Democrat, said he did not know that the projects he authorized in the Senate's budget did not appear in the final budget.

"While it is clear that the budget process did not work the way it should have, I continue to believe that every project the Senate recommended for funding last year was truly deserving," Basnight wrote.

Morgan merely thanked Merritt for giving him a chance to review the report.

Black said he had done little more than recommend Decker for the Cultural Resources position