North CarolinaHB 3582025-2026 SessionHouseWALLET

Continuing Budget Operations Part II.

Sponsored By: Jennifer Balkcom (Republican), Chris Humphrey (Republican), Mitchell S. Setzer (Republican)

Signed by Governor

ACCOUNTINGADMINISTRATION DEPT

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Bill Overview

Analyzed Economic Effects

27 provisions identified: 19 benefits, 2 costs, 6 mixed.

Big state capital projects for 2025–26

The law provides $888,565,897 in one‑time state capital funding for 2025–26. Money goes to many project codes. For example, TRAN23‑1 rises to $125 million, UNC/PEM25‑1 gets $5 million, and the State Highway Patrol gets $1.5 million for repairs.

Easier school enrollment and safer e-learning

A child may start school remotely before proof of residency, with documents due when attendance begins. If the family is in temporary housing tied to military dates, enrollment can last up to one year; juniors and seniors may stay through graduation. Private schools qualify under this Part if accredited by the State Board or an institutional accreditor, with other existing rules unchanged. Virtual course providers must be accredited, use teachers licensed in NASDTEC states, and align courses to NC standards.

More disaster aid and strict oversight

The State provides $55 million for disaster matching in FY 2025–2026: $40 million for eligible disasters (excluding Hurricane Helene) and $15 million for Tropical Storm Chantal. It adds $2 million for a public dashboard, $1.5 million to Warren Wilson College, $1 million to UNC Asheville, and $5.5 million for the State share to fix highways damaged by Chantal. Federal disaster awards received on or after September 1, 2025 are automatically appropriated and must be reported within 30 days. The Governor cannot reallocate these funds, and OSBM and the State Auditor must report uses and show spending on the public dashboard.

Hertford County dock, road, and jobs deal

The state provides $51 million: $40 million for a public dock and $11 million for a road to it. Payments go through agreements with the county, rural development authority, or as reimbursements. The business must invest at least $974 million and create 835 jobs with average pay over 175% of the county wage. The Department of Commerce must include performance and repayment terms and report each year.

Airport projects and RDU-Dublin flights

The state sets aside $750,000 per year in 2025–27 to support new nonstop RDU–Dublin service. Payments come after 180 and 360 qualifying flights, and the airline must average 14 such flights per month. Tri‑County Airport gets $3.6 million for hangar improvements. Coastal Carolina Regional Airport gets $10.4 million for site and infrastructure work if it signs a long‑term tenant lease. Unspent Brunswick County Airport grant funds do not revert and stay available for new improvements.

Arena area public infrastructure funding

The state provides $35 million for public infrastructure tied to a regional entertainment and sports arena. The Office of State Budget and Management allocates the money to the Centennial Authority to pay a qualifying redevelopment entity. The funds do not revert and stay available until the work is finished.

Limits on free UNC employee courses

Starting June 26, 2025, full-time UNC faculty and staff may take no more than three tuition‑free courses each year. Campus law enforcement officers follow a separate limit set by regulation. The cap applies beginning with the 2025–2026 academic year.

Stricter rules for nutrition licenses

To be licensed as a dietitian/nutritionist or nutritionist, your degree must be from a school that was accredited when you graduated. The Board may recognize other nutrition therapy exams only for graduates of accredited schools and only with a two‑thirds Board vote. Also, the Governor’s educator appointee to the Board must teach at an accredited college or university.

School funding cuts with carve-outs

State K–12 funding drops by $9,122,184 in each of 2025–26 and 2026–27. Cuts include $3 million for reduced‑price meal copays, $1,817,968 for small specialty high schools, and $1 million for virtual cooperative high schools. Carve‑outs remain: qualifying small specialty high schools keep funding for one principal and one clerical job. Cooperative innovative high schools that were originally approved as virtual keep their prior funding stream.

Who qualifies for NC student aid

For State loans, you must be a North Carolina resident as defined, be federally eligible, and attend an eligible NC college. For State scholarships, grants, and work‑study, you must be a NC resident for tuition, be enrolled or plan to enroll, make suitable academic progress, and not already hold a bachelor’s where rules say so. Private schools qualify only if they are nonprofit NC institutions and meet the listed accreditation paths (preferred agencies, TRACS, or certain transitional designations).

Most sections take effect July 1, 2025

Unless a section lists a different date, this law takes effect retroactively to July 1, 2025. Sections with their own dates or sunsets still follow those dates.

Lower fees for appraiser courses at colleges

Approval and renewal fees are not charged for appraiser qualifying or CE courses offered by North Carolina public or preferred‑accredited colleges, or by government agencies. Private sponsors still pay set course fees. This can lower provider costs and may reduce course prices for students who use public institutions.

Easier licensing for massage students

A community college massage program accredited by a preferred agency is exempt from Board approval or licensure steps. The college must certify each year that the program meets Board standards. Graduates qualify for licenses as if the program were Board‑approved.

More support for innovative high schools

Three named schools may operate as cooperative innovative high schools starting in 2025–26. Each of the three gets $635,000 in recurring funds each year of 2025–27. The state also provides $1,110,000 each year of 2025–27 to support Dare Early College HS, Rockingham County CTE Innovation HS, and the three named schools. A new formula gives recurring yearly supplements by county tier: Tier 1 $275,000 (Northeast Regional School of Biotechnology and Agriscience $310,000), Tier 2 $200,000, Tier 3 $180,000.

More tuition help for Science and Arts grads

The state provides $2.8 million each year of 2025–27 for tuition grants. The money supports eligible graduates of the NC School of Science and Mathematics and the UNC School of the Arts. If you are an eligible graduate, more grant funds are available.

More online access to court records

The court system can sell its mainframe outside the State Surplus Property Agency, and all net proceeds go to the Court IT Fund. The courts may also contract with outside companies to provide remote public access to electronic court records where allowed by law. Money from these contracts is deposited in the Court IT Fund.

NCCU can reuse house sale money

North Carolina Central University keeps net proceeds from the sale of the Chancellor’s residence in a special fund. The money can only be used to buy another Chancellor residence, with Board of Trustees approval and under UNC Board of Governors policies.

State Auditor gets more office space

The Department of Administration must assign the State Auditor four floors of exclusive space in the Albemarle Building in Raleigh. The move adds two floors and must be finished by December 1, 2025. This requirement overrides any conflicting space plans.

More legal and security staff at Labor

The Department of Labor gets $650,000 in 2025–26 and $650,000 in 2026–27 to fund three attorney positions. These jobs are policy‑making and exempt from certain hiring limits. The Department also gets $150,000 each year of 2025–27 for security services.

More time and training at community colleges

The $10 million for Wilson Community College’s biologics training center stays available until June 30, 2027. A $25 million grant to Brunswick Community College stays available until December 31, 2028, for workforce and public safety buildings. Community colleges may also offer specialized public‑safety courses to Catawba tribal departments.

No board fees for some CE courses

The Real Estate Commission cannot charge course application, renewal, or other fees for CE courses sponsored by in‑State accredited colleges. The appraiser Board cannot charge those fees for CE offered by accredited colleges or government agencies. Private sponsors may still charge their own course fees.

Preferred accreditation rules for colleges

UNC campuses and community colleges must keep accreditation from a preferred accrediting agency. They may hold any non‑preferred accreditation only while preferred accreditation is maintained. The law defines which agencies count as preferred. Independent nonprofit NC colleges with preferred accreditation may compete for State solid and hazardous waste research contracts on the same basis as UNC.

Stronger state labor law enforcement

The Department of Labor may sue in State civil courts and recover civil penalties to enforce labor rules. The Department can represent itself, the Attorney General can assign staff, and the Commissioner can hire private counsel. These tools expand the State’s ability to enforce workplace laws.

Temporary reset for big job projects

A qualifying business with a transformative project may ask to reset its base period. The business must be within 48 months of the base period, employ over 1,000 full‑time workers in North Carolina, and not have received any grant payments. This authority takes effect now and ends June 30, 2026.

Disaster help with strict recovery rules

The law provides $6 million in grants for individuals and families after emergencies. NC Emergency Management runs the program and reports every six months until the money is gone. Recipients must first seek insurance, federal aid, and (for colleges or other non‑State entities) private donations. If they later get that money, they must remit it back to the State agency, up to the amount the State paid. All contracts must include these rules, the Governor must avoid double paying costs that federal funds cover, and any unspent disaster funds in this part revert to the Savings Reserve on June 30, 2031.

New formula for disaster recovery loans

The law changes how “net loan funds” are calculated in the Golden LEAF Rapid Recovery Loan Program. It removes certain matching‑fund references and adjusts how recapture expenses and unrecaptured State funds are treated. This can change how much money is available for recovery loans to small businesses.

Budget carryforward rules and repeals

Other 2025 laws that gave money to covered agencies stay in effect unless this act changes them. If this act conflicts with G.S. 143C‑5‑4, this act controls, and allotments are adjusted from July 1 when the main budget becomes law. The law also repeals Section 5 of S.L. 2025‑57, Part 4 of S.L. 2025‑46, and Part 3 of S.L. 2025‑56.

Sponsors & Cosponsors

Cosponsors

Shelly Willingham
Democratic • House