North Carolina’s New Budget: A Mixed Bag of Relief and Concerns
Governor Josh Stein has finally signed North Carolina’s state budget into law, bringing an end to more than 1,000 days without a formal financial plan. While the new budget introduces several positive changes, it also contains elements that have drawn criticism from the governor.
During a ceremony at the Governor’s Mansion, Stein highlighted the budget’s key features, including the largest teacher pay increases in over 15 years, salary hikes for state employees, and a significant boost for state law enforcement officers. The budget also allocates an additional $700 million for Hurricane Helene recovery and over $1 billion to support the state’s Medicaid rebase.
Despite these advancements, Stein expressed concerns over the budget’s limitations. “North Carolina has got a good thing going,” he noted, emphasizing the need for continuous investment in the state’s people and infrastructure. However, he pointed out that the state still ranks in the bottom 10 for correctional officer pay, even with the new raises.
State troopers will see their starting pay move up from 49th to 41st nationally. “If I told y’all we were 41st, you would not be proud, but it’s a heck of a lot better than 49th,” Stein remarked.
In addition to the lack of retroactive pay raises, most state employees will receive one-time bonuses ranging from $1,000 to $1,750. However, Stein cautioned that these raises do not offset the pay cuts effectively experienced due to inflation over the past two years.
Hannah Moon, a decorated English teacher from New Hanover County, praised the raises for early-career educators but stressed the need for further improvements. Though the starting salary for teachers will be the highest in the Southeast, the salary schedule remains stagnant after 15 years of service. Moon, with over 16 years of experience, will receive a $1,000 bonus but noted that teachers typically spend about $1,400 annually on student supplies.
Background on the Budget Delay
North Carolina had been the only state without a budget for the current biennium. Progress was stalled until May 12, when House Speaker Destin Hall and Senate leader Phil Berger announced a framework that included income tax reductions, teacher salary hikes, and the use of $208 million in American Rescue Plan Act funds for a new children’s hospital in Apex.
Stein criticized the tax plan, which phases out the corporate income tax by 2029 and maintains automatic tax cuts for wealthier individuals and corporate shareholders.
Republican leaders made the final budget version public just before it was sent to Stein’s desk. Following its approval, Berger stated, “For over 15 years, Republicans in the General Assembly have meticulously crafted budgets to rein in the runaway spending Democrats were dependent on.” Speaker Hall also praised the budget, noting its potential to “strengthen our communities” and “improve lives across our state.”
