NC budget clears first votes, final passage likely Thursday

North Carolina’s long-awaited state budget cleared its first major floor test Wednesday, passing initial votes in both the House and Senate and moving lawmakers within one vote of sending the spending plan to Gov. Josh Stein.

The budget received bipartisan votes of 37-12 in the Senate and 92-22 in the House.

The budget bill, Senate Bill 257, is expected to receive final votes on Thursday. If approved again by both chambers, the measure would head to Stein’s desk after months of negotiations between House and Senate Republicans.

If the budget receives final approval Thursday, Stein would have until July 12 to sign it, veto it, or allow it to become law without his signature. Under the North Carolina Constitution, the governor has 10 days after a bill is presented to act on it.

The package sets a roughly $34 billion General Fund spending plan and includes teacher raises, state employee raises, public safety pay increases, additional Hurricane Helene recovery funding, capital projects, tax changes, Medicaid-related guardrails, and revisions to sports betting taxes.

Wednesday’s votes marked the first floor action since legislative leaders unveiled the full budget language Tuesday morning. Because the bill is moving as a conference report, lawmakers are voting on the negotiated package as a whole rather than amending it on the floor.

The spending plan comes after months of budget uncertainty in Raleigh. North Carolina entered the new fiscal year on Tuesday without a new budget in place, though the state government continues operating under existing funding levels.

Republican leaders framed the proposal as a disciplined spending plan that provides tax relief while funding key priorities, including child care, housing, public safety, education, and stronger oversight of state dollars.

“Hardworking North Carolina families are watching every dollar they spend,” said House Speaker Destin Hall, R-Caldwell. “That’s why we fought for a budget that helps our people keep more of their paychecks, invests in making child care and housing more affordable, and makes certain that taxpayer dollars are spent more responsibly through stronger oversight. North Carolina’s growth and success have been built on the promise of fiscal discipline. Our budget keeps that promise.”

Senate Appropriations Chairman Brent Jackson, R-Sampson, said the budget reflects years of Republican-led fiscal policy focused on restraint, raises, and tax relief.

“Republican-led budgets have transformed North Carolina into the best state in the nation,” Jackson said. “Our years of fiscal restraint allowed us to provide regular salary increases to state employees, including the significant raises in this budget, while delivering relief to North Carolinians who are feeling the pinch of rising costs.”

Donald Bryson, CEO of the John Locke Foundation, also praised several pieces of the proposal, saying the budget advances conservative priorities after years without a new comprehensive state spending plan.

“After nearly three years without a new comprehensive state budget, North Carolina taxpayers deserve a budget that advances growth, restraint, and accountability,” Bryson said. “This proposal includes several important reforms the John Locke Foundation supports, including continued income tax relief, a targeted Certificate of Need repeal, stronger Medicaid program integrity, and property-rights protections in local permitting and land-use disputes.”

Bryson also pointed to education provisions in the budget, saying he was “encouraged that the budget begins the work of modernizing education in North Carolina by studying public school choice through open enrollment and moving toward a more student-centered school finance system.”

The budget keeps Opportunity Scholarship funding steady, continues previously scheduled tax reductions, and includes pay increases for teachers and state employees. It also directs money toward law enforcement and corrections pay, an area legislative leaders have highlighted as part of a broader public safety push.

Hurricane Helene recovery remains a major piece of the package. Lawmakers have already approved several rounds of disaster aid, but the budget includes additional money tied to western North Carolina recovery needs.

The plan also includes Medicaid-related provisions following months of legislative scrutiny over rising costs, including concerns about the growth of Medicaid-funded autism therapy spending. Lawmakers have said the added guardrails are intended to strengthen oversight and protect the program’s long-term stability.

While Bryson praised several provisions, he criticized the omission of language addressing NCInnovation, the nonprofit that received a $500 million taxpayer-funded endowment in the 2023 state budget.

“The most disappointing omission is NCInnovation,” Bryson said. “There has been broad agreement from the House, Senate, and governor that all or most of NCInnovation’s taxpayer-funded endowment should be clawed back, yet this budget appears to make no explicit statutory change to NCInnovation. The NCInnovation endowment is nearly three years old, and taxpayers should not have to wait longer for accountability on $500 million that rightfully belongs to them.”

Democrats criticized the budget process and several policy choices in the plan, arguing the proposal was negotiated largely behind closed doors and released shortly before votes. Opponents also raised concerns about education funding, public employee pay, healthcare, and the continuation of scheduled tax cuts.

Wednesday’s votes, however, showed the budget bill has overwhelming, bipartisan support as it advanced in both chambers. Final passage on Thursday would send the bill to Stein, setting up a decision by the Democratic governor on whether to sign the plan, veto it, or allow it to become law without his signature.

The vote comes as lawmakers are working to wrap up major business before leaving Raleigh. If the budget clears Thursday, it would mark the most significant breakthrough of the legislative session and end the long-running standoff between the House and Senate.

“NC budget clears first votes, final passage likely Thursday” was originally published on www.carolinajournal.com.