UPCOMING EVENTS
July 16-18, 2025
North Carolina Healthcare Association Summer Meeting
July 20-22, 2025
Association of Executives of North Carolina (AENC) Annual Meeting
October 9-10, 2025
Association of Executives of North Carolina (AENC) Fall Conference
November 13, 2025
Women Lead NC
LEGISLATIVE NEWS
NC GENERAL ASSEMBLY RECESSES WITHOUT AGREEMENT
On Thursday, the North Carolina General Assembly began its summer recess in disarray, with the House and Senate unable to agree on an adjournment plan. The Senate passed a resolution to reconvene monthly through early November, but the House did not act on it. House Speaker Destin Hall (R-Caldwell) announced a two-week pause in voting, while Senate leader Phil Berger (R-Rockingham) said the Senate would hold only skeletal sessions if the House did not cooperate. This impasse means the state will begin the new fiscal year without a budget, as efforts to pass even a scaled-down "mini-budget" failed.
Tensions were high throughout the week, marked by protests from shrimpers, internal Republican disagreements, and partisan finger-pointing. Berger blamed the budget stalemate on the House's attempt to renegotiate previously agreed tax cuts, while Democrats criticized the legislature for prioritizing divisive bills over essential governance. They pointed to the passage of legislation targeting diversity programs and immigration enforcement, while a bipartisan bill to prevent sexual exploitation was altered to include controversial provisions.
Despite the gridlock, lawmakers did manage to pass a significant hurricane relief bill, allocating $700 million for recovery efforts in Western North Carolina. Governor Josh Stein welcomed the relief funding but emphasized the need for a comprehensive budget to address broader state challenges.
Internal GOP conflict also surfaced, particularly around a proposed ban on inshore shrimp trawling. Senator Bobby Hanig (R-Currituck) accused his own party of silencing him during debates on the issue. Meanwhile, Democrats expressed frustration over their amendments being routinely tabled and accused Republicans of using the session to push culture-war legislation rather than address pressing state needs.
Read more by State Affairs Pro
WITH BUDGET NEGOTIATIONS STALLED, SENATE PASSES MINI BUDGET
The North Carolina Senate has passed House Bill 125, a temporary measure to fund essential services while state budget negotiations are stalled. This bill allocates over $3.4 billion for fiscal year 2025-26 and $1.9 billion for 2026-27, focusing on education, health, and disaster recovery programs. The Senate's bill passed with a 39-6 vote, gaining support from 13 Democrats.
Senator Graig Meyer (D-Wake) emphasized that the mini budget addresses urgent needs due to the failure to agree on a full budget, highlighting disagreements on tax cuts between House and Senate leaders. Four proposed amendments were rejected in the Senate.
Under the mini budget, $260 million is allocated for education in 2025-26 and $256 million for 2026-27, alongside funding for other educational necessities. The Health and Human Services section includes nearly $769 million in the first year and $738 million in the second for programs like Medicaid. Additional funding is set for public safety, transportation, and state employees' retirement health plans.
House Speaker Destin Hall indicated that the House will not accept House Bill 125, and the House budget committee has moved forward with its scaled-back spending proposals. With significant disagreements over spending priorities and future tax policy, lawmakers are unlikely to pass a full budget before the new fiscal year ends on July 1.
In the meantime, the House is advancing two key spending bills. House Bill 192 includes a 2.5% raise for state employees, an average 6.4% teacher pay increase starting next year, and a 20% reduction in vacant state jobs. The second bill, Senate Bill 177, allocates funds for various projects and contributes to the state building fund.
A lack of a budget delays funding for many state agencies. North Carolina will not face a government shutdown, allowing state agencies to continue functioning at current levels. However, growing schools and universities will experience budget cuts due to enrollment-based funding. Teachers and state workers will not receive new raises, and planned construction and road projects will be delayed.
Thursday was the last voting day before the legislature recessed for a summer break. Although the stopgap funding allows some urgent matters to progress, broader budget negotiations remain unresolved. While some money may be allocated for specific needs, it will take several months before other state government areas, like schools and public health, receive new funds.
Read more by The Carolina Journal
HELENE RELIEF LEGISLATION PASSED BEFORE SUMMER RECESS
North Carolina lawmakers approved an additional $500 million in Hurricane Helene relief funding as they prepared to recess for the summer, amid stalled negotiations over the broader state budget. The Senate passed House Bill 1012 unanimously, also redirecting $300 million from transportation funds.
Funding allocations in the new relief bill are:
- $685 million from the U.S. EPA for water and wastewater treatment projects.
- $75 million to N.C. Emergency Management for private roads and bridges.
- $70 million to support FEMA program matching funds.
- $25 million to the N.C. Department of Agriculture for a crop loss program.
- $18 million to volunteer organizations aiding in Hurricane Helene recovery.
- $16 million to the Town of Canton, including $14 million for purchasing and developing a new regional wastewater facility.
- $15 million to the N.C. Forest Service for wildfire response resources.
- $10 million to the N.C. Department of Environmental Quality for dam safety and rehabilitation.
- $5 million to the N.C. Department of Commerce to promote tourism in Western North Carolina.
The bill now goes to Governor Josh Stein, who is expected to sign it, bringing the total state aid for Helene-recovery to over $2 billion. Stein had urged lawmakers to act quickly, even without a full budget deal, to support communities still rebuilding.
DONOR PRIVACY LEGISLATION ADVANCES TO GOVERNOR'S DESK
The North Carolina General Assembly has passed Senate Bill 416, known as the Personal Privacy Protection Act, and sent it to Governor Josh Stein for approval. After passing the Senate in May, the bill passed the House on Wednesday by a vote of 63-46. The bill seeks to prevent state and local government agencies from collecting or disclosing personal information about individuals who donate to nonprofit organizations. It reinforces existing protections by adding civil penalties for government employees who attempt to compel nonprofits to reveal donor lists.
Supporters argue that the bill protects constitutional rights, particularly freedom of association and expression, by ensuring that individuals can support causes privately without fear of exposure or retaliation. The bill includes exceptions for disclosures required by federal law, subpoenas, or court orders. It also blocks public agencies from releasing donor information through public records requests or accidental leaks.
Critics are concerned that the bill could reduce transparency, especially for nonprofits involved in political advocacy. However, the legislation does not alter existing campaign finance disclosure laws or reporting requirements to the IRS or the State Board of Elections. The bill draws on legal precedents, including the landmark Supreme Court cases NAACP v. Alabama (1958) and Americans for Prosperity Foundation v. Bonta (2021), which affirmed the constitutional right to donor privacy.
Read more by The Carolina Journal
GOVERNOR TO DECIDE FATE OF NC ENERGY AFFORDABILITY LEGISLATION
Legislators have passed Senate Bill 266, which significantly weakens a major environmental law from former Governor Roy Cooper. This bill removes a requirement for Duke Energy to reduce carbon emissions by 70% from 2005 levels by 2030, although a long-term goal of being carbon neutral by 2050 remains in place. The energy sector is North Carolina's second-largest source of greenhouse gas emissions.
Environmentalists argue that this change is short-sighted and could hinder the state's shift to clean energy sources like wind and solar. Supporters of the bill claim it will help keep utility bills lower and give Duke Energy more flexibility to meet increasing demand from a growing population and businesses.
Key features of the bill include eliminating the 2030 carbon reduction goal and modifying how Duke can set utility rates and recover costs for new power plants. Proponents state the changes could save residents up to $15 billion in future utility costs and prioritize energy reliability and affordability rather than arbitrary carbon reduction goals.
The bill received strong support from the GOP and some Democrats, backed by business groups concerned about energy costs. Duke Energy also supports the bill, believing it provides necessary flexibility for electricity needs.
Conversely, clean energy advocates warn that the bill shifts financial risks of wasteful energy investments from Duke to customers and allows for more greenhouse gas-emitting natural gas plants instead of cleaner alternatives. They claim it would ultimately lead to higher energy costs for North Carolinians.
The bill is now on Governor Stein's desk, who has until the end of June to sign, veto, or let it become law without his signature. The support from some Democrats might influence his decision, as avoiding a veto override requires careful consideration of votes.
Read more by USA Today Network/Wilmington Star News
FOSTER CARE REFORM BILL SIGNED BY GOVERNOR
On Thursday, Governor Josh Stein signed into law House Bill 612, known as the Fostering Care in NC Act, enacting major reforms to the state's foster care system. The bipartisan legislation, years in the making, grants the state Department of Health and Human Services greater authority to oversee and hold county-run social services accountable. It also strengthens procedures and deadlines for investigating abuse and neglect within the system.
The bill signing took place in front of families, advocates, social workers, and lawmakers. Senate Democratic leader Sydney Batch emphasized the importance of the law in protecting children from harm and credited WRAL's documentary "Broken: Foster Care in North Carolina" with helping to build momentum for the bill. The documentary highlighted systemic failures that contributed to the urgency for reform.
Governor Stein praised the bipartisan collaboration behind the bill, calling it a vital step in protecting vulnerable children and improving the child welfare system. He also announced the launch of Path NC, a new statewide digital platform designed to unify child welfare data and help social workers track foster children across counties in real time, ensuring better coordination and care.
LEGISLATURE PASSES BILL LIMITING LEGAL AID FUND DISBURSEMENTS
On Thursday, the North Carolina General Assembly passed Senate Bill 429, titled "2025 Public Safety Act," that prohibits the use of funds from the Interest on Lawyers' Trust Accounts (IOLTA) for grants or public assistance programs. Originally created in 1983 to support legal aid across the state, the IOLTA fund will now be restricted to covering only administrative fees, effectively freezing its broader use until 2026. These funds have played a crucial role in helping low-income individuals access legal representation and services they might not otherwise afford.
With the new legislative move, the use of IOLTA funds will now be restricted solely to legal service-related activities, effectively ending their broader application to charitable or community-based initiatives. Lawmakers backing the freeze argue that the funds should remain focused on their original legal intent. However, critics, including legal aid advocates, warn that this change could significantly impact vulnerable populations who rely on nonprofit legal assistance for issues like housing, domestic violence, and immigration.
The bill now awaits Governor Josh Stein's decision on whether to sign or veto it. If enacted, it would freeze the use of IOLTA funds from July 1, 2025, through June 30, 2026. While grants already issued in 2025 would still be honored, no new grants could be awarded during the 2026 fiscal year.
HOUSE BILL 79 ADVANCES TO INSURANCE COMMITTEE
A bill aimed at helping private sector employees without employer-sponsored retirement accounts had its committee hearing on Wednesday. House Bill 79, sponsored by Representative Jarrod Lowery (R-Robeson), addresses the needs of over two million North Carolinians who lack a pension or 401(k). The bill, titled "North Carolina Work and Save," proposes a retirement option resembling a 529 college savings plan, allowing automatic deductions for savings. Lowery emphasized that saving $150 a month could prepare individuals for retirement after 10 to 20 years.
The fund can be transferred to a 401(k) if individuals change jobs, as access to workplace plans significantly increases the likelihood of saving for retirement. The bill proposes the establishment of the North Carolina Small Business Retirement Savings Board, with $1 million allocated over two years for startup costs. Contributions could start on July 1, 2027, following additional approvals. The bill has received a favorable review and has been referred to the House Insurance Committee for further consideration.
Read more by State Affairs Pro
WHAT WE'RE LISTENING TO
- Under the Dome Podcast
- Do Politics Better Podcast
- WUNC Politics Podcast
- Carolina Newsmakers Podcast
- NC Capitol Wrap Podcast
WHAT WE'RE READING
- Asheville Citizen Times
- Carolina Journal
- Charlotte Observer
- Fayetteville Observer
- Greensboro News & Record
- NC Insider
- New Bern Sun Journal
- News & Observer
- North State Journal
- Our State Magazine
- Triangle Business Journal
- Under the Dome
- Wilmington Star News
- Winston-Salem Journal
- WRAL
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