Budget receives overwhelming bipartisan support
Raleigh, N.C. – The proposed state budget today received overwhelming bipartisan support as it passed the North Carolina Senate by a vote of 40-8.
Senate Leader Phil Berger (R-Rockingham) said, "This budget continues the Republican-led legislature's decade-long commitment to low taxes and responsible spending. The multibillion dollar surpluses these policies helped create are evidence that they're working, and it means we can cut taxes even more."
The budget includes a provision to rein in the executive branch's emergency powers. It also prohibits the type of secretive settlement deal that Attorney General Josh Stein struck with politically allied lawyers to change election law after voting began in 2020.
Below are details on noteworthy provisions of the compromise budget:
Total Spend
Net appropriation for FY 2021-22 is $25.9 billion and net appropriation for FY 2022-23 is $27.0 billion.
The Rainy Day Fund balance will be $4.25 billion at the end of the biennium.
Salaries
A 5% pay raise for most state employees and an average 5% pay raise for teachers over the biennium.
Increase the minimum wage for all non-certified personnel and community college staff to $15 per hour beginning in 2022.
A $2,800 bonus to most teachers using federal funds.
Bonuses for all state employees using federal funds: $1,500 for state employees who make less than $75,000, and $1,000 for state employees who make more than $75,000. Law enforcement, correctional officers and staff, and 24-hour residential or treatment facility employees receive $1,500.
$100 million in recurring funds for a new state-funded teacher salary supplement focused on low-wealth counties to help them compete with big, wealthy counties when recruiting teachers. (This supplement is not reflected in the average salary raise figure.)
Capital/Infrastructure
$6 billion in cash to the State Capital and Infrastructure Fund over the biennium to fund infrastructure projects and pay down debt.
Begins annual cash contributions to capital and infrastructure projects and debt service totaling $16.1 billion over 10 years.
Provides $84 million to Elizabeth City State University for a residence hall, sky bridge, dining facility, and flight school.
Provides $1 billion for broadband expansion.
Taxes
Increases zero-tax bracket to $25,500.
Cuts the personal income tax rate from 5.25% to 3.99% by 2027, starting with 4.99% in 2022.
Increases child tax deduction by $500 per child.
Eliminates state income tax on military pensions.
Education
Additional $1.5 billion above the base budget over the biennium in recurring funds for K-12 education.
$528 million transfer over the biennium from the N.C. Education Lottery to the Needs-Based Public School Capital Building Fund, $200 million to the Public School Capital Fund, and $80 million into a newly created repair and renovations fund. Over the course of the next 7 years, a projected $2.6 billion will be spent on school capital.
Adds Fayetteville State University to the N.C. Promise program, which guarantees $500 in-state tuition per semester at participating schools.
Other Items
Provides a 5% supplement for state retirees over the biennium.
Appropriates remaining 2020 HAVA funds to enhance technology and improve cybersecurity.
Revises Emergency Management Act to require a vote of the Council of State to extend a statewide emergency beyond 30 days (effective Jan. 1, 2023).
Prohibits collusive settlements by the Attorney General.
Provides $283 million to support deepening and expanding the Wilmington Harbor.
