New plan delivers raises for teachers and state employees, funds Medicaid and Helene recovery, and trims more than 1,000 government positions.
By Coastal Carolina News Staff Writer
Gov. Josh Stein on Tuesday signed North Carolina’s new $34 billion state budget, formally ending a years‑long stalemate that left agencies operating under temporary spending measures. The new plan sets pay raises across state government, expands funding for public safety and education, and directs substantial resources toward ongoing Hurricane Helene recovery efforts in western counties.
The budget includes a 3% raise for all state employees and an average 8% increase for teachers, marking one of the largest starting pay boosts in decades. Corrections officers and certain law enforcement positions will see raises as high as 17 percent, a move state officials say is aimed at stabilizing staffing levels and reducing turnover.
The personal income tax rate will drop from 3.99% to 3.49% next year, continuing a multi‑year phase‑down approved in earlier sessions. Legislative budget writers said the reduction is intended to offset inflationary pressures on households, while critics argue it may limit future revenue flexibility.
Education funding expands across multiple areas, including community colleges, child care programs, summer nutrition services, and cybersecurity upgrades for school systems. Medicaid is fully funded for the year, ensuring continuity for expansion enrollees and existing beneficiaries.
More than $700 million is directed toward Hurricane Helene recovery, with allocations for housing, infrastructure repair, and long‑term community redevelopment. State emergency managers say the funding will help stabilize counties still working through debris removal, road reconstruction, and displaced‑resident support.
Stein praised the budget’s investments in education, public safety, and disaster recovery, calling them “real wins” for North Carolina. He also criticized provisions that eliminate more than 1,000 state government positions and others he described as “unconstitutional” or “wrong‑headed,” though he did not specify which sections he expects to face legal challenges.
The plan also adjusts tax rates for online sports betting and prediction markets. Sportsbook operators will see their tax rate rise from 18 percent to 23 percent, while prediction market platforms will be taxed at 6 percent beginning January 1, 2027.
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