Taxes, guns, schools, birth and death: State budget touches on all aspects of North Carolina life
North Carolina lawmakers gave final approval to the state's $30-billion budget Friday morning. Democratic Gov. Roy Cooper said Friday that he would allow the budget to become law without his signature.
The 625-page budget bill and its 786-page companion money report were released to the public Wednesday afternoon. The lengthy documents touch on nearly every aspect of life in North Carolina from birth (money for the digitization of birth records) to death (increased fees for autopsies) and everything in between.
Here is a look at some of the provisions included in the budget. The spending plan:
Medicaid expansion: Provides federally funded health care coverage to more than 500,000 North Carolinians who work jobs that don't offer health insurance and who also don't make enough money to afford insurance on the private market. It ends a fight that lasted more than a decade since the passage of the 2010 Affordable Care Act. Republicans changed their stance on expansion over the past few years. The expansion bill passed in March, but its implementation was tied to the passage of the budget. The federal expansion bonus is about $1.5 billion split over two years.
Raises for teachers, state workers: Gives most state employees a 4% raise this fiscal year, which began July 1, and a 3% raise next fiscal year. The pay increase will be retroactive. That means an average state worker with a $57,377 annual salary is looking at a raise to just under $60,000 this fiscal year and about $61,400 next year. Beginner teacher pay would jump from $37,000 to $39,000, and again up to $41,000 next year, an increase of 10.8% over both years combined. More experienced teachers would see smaller pay bumps of between $1,000 and $1,800 per year, with the bigger step increases going to younger teachers. It's significantly less than Cooper, Democrats, the State Employees Association of North Carolina and teachers groups asked for.
Raises for Council of State: Gives the governor and other members of the Council of State — North Carolina’s collection of 10 statewide elected officials — five-figure raises. The governor’s salary would be $198,120 this year, a 19% increase. The position’s salary rises to $203,073 the year after that. Other Council of State members would get a 7.5% increase this year and another 7% in the next year. That's more than double the average percentage raises that state employees and teachers get in this budget, a fact not lost on Democrats who criticized the plan. Senate Republican leader Phil Berger said the legislature compared the state’s executive branch salaries to those in other states and found that North Carolina lagged well behind.
School vouchers: Qualifies more families for publicly funded private school vouchers under a massive expansion of the state's Opportunity Scholarship. The program currently serves mostly lower-income families, providing applicants with a voucher to help pay for private school tuition for their children. The expansion would make families of all incomes eligible and its cost could grow to more than $500 million per year by 2031. Democrats argue that private schools don't have to accept all students, including students with disabilities, and should not be getting taxpayer money that could be going to public schools. Opponents say the program takes away dollars from public schools.
Tax cuts: Accelerates planned cuts to the state's personal income tax rate. The state's current rate is 4.99% and will decrease to 4.6% in 2024, 4.25% in 2025 and 3.99% in 2026 and beyond. The rate could fall further from that point if the state meets certain general fund revenue targets over the next decade. The rate go as low as 2.49%.
No expanded gambling: Doesn't allow for three casino-anchored "rural tourism districts" in certain economically distressed counties, a proposal that held up the budget passage for weeks. The proposal also called for a fourth new casino site in the southeastern part of the state to be controlled by the Lumbee Tribe. The budget also doesn't legalize video lottery terminals, or video gaming terminals. A proposal would have allowed the video poker or slot machine-style terminals in gas stations, convenience stores, bars and restaurants.
NCInnovation: Uses $500 million, split over two years, to fund NCInnovation, an attempt to boost economic development around state universities by helping researchers turn ideas and discoveries into successful businesses. The influential group behind the idea had asked for a $1.4 billion endowment, and the group’s chief executive called that the “minimally acceptable amount,” but that proved too big an ask for many lawmakers.
Bus drivers: Gives more than $4.7 million to local boards of education to increase pay for school bus drivers. School districts, including those in the Triangle, have been facing a severe shortage of bus drivers.
School lunches: Eliminates student co-payments for reduced-price breakfast and lunches and eliminates any penalties on students, such as withholding student records or not allowing a student to participate in graduation or receive a diploma, for unpaid school meal debt.
Limits emission regulations: Forbids the state from requiring utilities to offset their carbon emissions through cap-and-trade programs. Also forbids the state from imposing emissions standards on new vehicles, including mandates for the purchase or sale of zero-emission vehicles.
Public records laws: Allows lawmakers in the future to refuse any records requests they don't want to comply with. State lawmakers have already exempted themselves from some parts of North Carolina's public records laws.
No COVID mandates: Bans schools, colleges, state agencies and local governments from demanding employees get a COVID-19 vaccination, except for hospitals and other facilities that have to require it to qualify for federal funding.
New 'secret police'? Gives sweeping new powers to the General Assembly’s Joint Legislative Commission on Governmental Operations, whose members are heavily skewed toward the party in power, to investigate the executive branch, government agencies and private companies that get state funding, and to force anyone involved in the investigation to keep it a secret. The committee would also be allowed to have people involved in an investigation charged with a crime, if the committee felt they were not fully forthcoming or cooperative. Democrats have compared the proposal to Nazi- and Soviet-era secret police squads, saying it'll be used by GOP leaders to carry out political retribution. On social media, Cooper spokesman Ford Porter denounced this section as “legislative secret police.”
Drivers license changes: Most people would only have to renew their driver's license every 16 years, instead of every eight years. The rule change will apply to everyone between 18 and 65 years old. The state DMV, however, says that would violate federal rules.
Healthcare exchange: Sets the stage for the state to build its own Affordable Care Act exchange to sell federally subsidized health insurance policies. The budget says the state Department of Insurance will submit a plan for the exchange, which would replace a federal exchange North Carolinians who qualify for these policies use now to research and purchase them. Insurance Commissioner Mike Causey expressed concerns that the budget doesn't set aside funding for the change, saying it may cost millions to implement.
Cheaper vehicle inspections: Exempts every county in the state, except for Mecklenburg County, from needing to conduct emissions tests along with the standard annual vehicle inspections. Many counties had already been exempted in recent years, but the budget will now also exempt drivers in Wake, Durham, Franklin and Cumberland counties, as well as a handful of other counties in other parts of the state.
Delayed retirement for judges: Raises the retirement age for judges on the state Supreme Court and Court of Appeals from 72 to 76, a change that would allow Republican Supreme Court Chief Justice Paul Newby, a Republican, to stay on the bench longer. Supreme Court justices are elected, and the change would help protect the court's 5-2 Republican majority.
Ethics panel makeup: Overhauls the Judicial Standards Commission, which investigates and disciplines judges, removing the State Bar Council’s appointment authority and giving those four appointments to the legislature’s Republican majority. State Rep. Marcia Morey, a Durham Democrat and retired judge, called the change “a huge concern.” The commission already is embroiled in controversy over its investigation of Supreme Court Justice Anita Earls, one of the high court’s two Democratic justices. Earls filed a federal lawsuit over the inquiry, saying she’s been targeted by the body in a way that violates her First Amendment rights.
Community college system: Gives legislature new authority over the state’s community college system in multiple ways, including a new requirement that the system president be confirmed by the General Assembly. Currently the system board makes that hire. This is one of several power shifts the legislature’s Republican leadership has contemplated this session.
Fire marshal: Changes the state fire marshal position from a title held by the state’s commissioner of insurance to a position the commissioner appoints to a three-year term subject to confirmation by the General Assembly.
Voter fraud: Bans the State Board of Elections from joining a national program aimed at combating voter fraud, called ERIC, which has been targeted by national conservatives after the 2020 elections.
Legal Aid of North Carolina: Forbids attorneys with Legal Aid of North Carolina, which helps people who can't afford an attorney, from participating in the N.C. Legal Education Assistance Foundation, which provides loan repayment assistance for law school debt. It's not clear why Republican budget writers included this prohibition in the budget, and a spokeswoman for Legal Aid did not respond to WRAL News requests for comment.
More power for Chief Justice: Changes the mix of judges who will be on the three-judge panels that review the constitutionality of state laws, including the election maps lawmakers draw which can go a long way toward deciding how many legislative seats a given political party wins. Right now Wake County’s senior superior court judge was automatically on these panels and the chief justice of the state Supreme Court picked the other two judges. Under this budget the chief justice, currently Republican Chief Justice Paul Newby, picks all three.
Lobbyist fees: Doubles, from $250 to $500, the registration fees lobbyists must pay per client per year. The bill also doubles, again from $250 to $500, the annual fees that lobbyist principals — any entity that hires a lobbyist — must pay. The budget also allows the state to charge lobbyists $2,000 per legislative session for a pass that will let them bypass the security line at the General Assembly building.
Ride-share taxes: Levies a new tax between 1% and 1.5% on ride-share services such as Uber and Lyft.
Guns in courtrooms: Lets state Supreme Court justices and Court of Appeals judges carry concealed weapons in court, a right already afforded to judges sitting in the state’s district and superior courts.
No plastic bag bans: Forbids local governments from restricting the use of plastic bags at grocery stores, and from levying fees for plastic bags.
Sports gambling: Rewrites a key part of the sports gambling law, which passed earlier this session but has not yet been implemented. The new language strips out the limit of 12 mobile betting operators and instead requires that operators have a "written designation agreement" with a professional sports team, the owners of certain major sports facilities and NASCAR or the PGA Tour. Mobile sports betting must start by June 15, 2024 under the law.
Limits on online games offered by lottery: Limits on the North Carolina Lottery's ability to offer casino-style online games, a concern that emerged after the Lottery Commission in August OK'd the sale of digital instant games beginning in November. Berger said lawmakers worry the commission's decision "might actually provide folks with basically a casino on their phone."
Child fatalities: Establishes "The State Office of Child Fatality Prevention" within the Department of Health and Human Services, Division of Public Health, to serve as the lead agency for child fatality prevention in North Carolina. The state office will oversee the coordination of support functions for the entire North Carolina Child Fatality Prevention System.
New children's hospital: Provides about $320 million for a new children's hospital in the Triangle, run by UNC Health. The facility will include a behavioral health hospital. An exact location hasn't been decided, Berger said.
Birth records: Provides $6 million over two years to digitize birth records so they can be stored electronically.
E-cigarettes: Provides $22.5 million over two years for an electronic cigarette prevention program aimed at students from the fourth grade through 12th grade. The money comes from a legal settlement with e-cigarette maker Juul.
Megasites: Increases the number of megasites in the state to seven, up from the current five, and it expands the list of industries eligible for public funding to include the semiconductor industry. Megasites are large undeveloped land tracts where businesses can locate massive projects.
Parental leave for school employees: Addresses a concern many school employees had, that rules required them to work at the same school for an entire year before they’d be eligible for paid parental leave. The budget would make it so they only need a cumulative 12 months of employment in public education, whether K-12 or higher education, to be eligible for paid parental leave.
Special education: Caps funding for students with disabilities at 13% of a school system’s or charter school’s enrollment. Currently, special education funding is limited to that amount in budgets, but the cap isn’t codified in state law. This budget would codify it, making that the law until a bill changes it. Statewide, 14% of students — 211,524 students — are identified under special education. Limiting funding at 13% means special education funding won’t be dedicated for at least 15,000 students with disabilities. Out of 115 school systems, 84 have enrolled more than 13% of their students in special education.
