State Legislature Approves Funds For Storm Recovery, Schools, And Infrastructure

By Carolina Journal Staff

On Tuesday, the North Carolina General Assembly approved a targeted spending plan that directs millions toward disaster recovery, education, infrastructure, and government operations. Senate Bill 449, Continuing Budget Operations Part IV, is the latest “mini-budget” to fund essential state operations for the 2025–26 fiscal year after lawmakers were unable to agree to a final full state budget by the end of the fiscal year on June 30, 2025.

Under North Carolina statute, the previous budget continues in the absence of a new one, preventing a government shutdown, but lawmakers have used mini-budgets to fund priorities on which the chambers can agree. This is the second such mini-budget from the Republican-led legislature this year. Gov. Josh Stein, a Democrat, signed the first one while continuing to call on lawmakers to reach a full budget deal.

Top Funding Priorities
Disaster recovery receives several of the largest allocations in the budget measure now headed to the governor’s desk. Businesses affected by Hurricane Helene will see relief through extended Golden LEAF bridge loans, which now allow 24 months of interest-only payments and repayment through 2032. Local governments in storm-damaged areas can delay repayment of state cashflow loans until after FEMA reimbursements are received, and a grant program supports infrastructure repairs not covered by FEMA Public Assistance reimbursement.

Education funding includes updated allotments for Cooperative Innovative High Schools, with $275,000 per school in Tier 1 counties, $200,000 in Tier 2, and $180,000 in Tier 3. The bill also raises nonresidents’ tuition at NC Promise universities including Elizabeth City State, Fayetteville State, UNC–Pembroke, and Western Carolina, from $2,500 to $3,500 per semester beginning in 2026–27.

Agriculture and environment programs receive $3 million for avian flu response and laboratory work, $581,788 for the state meat inspection program, and $700,000 for five new full-time staff positions at the Environmental Management Commission.

Public safety investments include $2.1 million to maintain the VIPER emergency radio network, $7.2 million for court technology upgrades, $600,000 to increase the number of Special Assistant US attorneys, and $2 million for State Bureau of Investigation equipment.

Other Key Expenditures
– $12 million to rebuild broadband fiber damaged by Hurricane Helene
– $25 million for the state Pay Plan Reserve
– $20.85 million to replace the North Carolina Integrated Budget Information System
– $1.18 million for a new state human resources system
– $7.5 million from State Fair receipts for repair and renovation projects at the fairgrounds
– $7 million for ferry maintenance and dry docking

Two other key measures in the bill affect the capital city of Raleigh, authorizing the state Department of Administration to sell two properties. One is on Dawson Street downtown and the other the old Rex Hospital building, which currently houses the state’s Department of Employment Security. Situated on the corner of Wade Avenue and Saint Mary’s Street, the old hospital is in a high value area.

Under the bill, it would be put up for sale or lease by April 1, 2027. After costs associated with a redevelopment plan, proceeds from the transaction would go into the State Capital and Infrastructure Fund. The budget directs the state DOA to come up with a new location for the Department of Employment Security by April 1, 2026.