After nearly three years without a new comprehensive state budget, North Carolina lawmakers on Thursday sent Gov. Josh Stein a roughly $34 billion spending plan that funds raises, continues tax relief, adds public safety investments, and closes one of the longest-running standoffs between the House and Senate.
The final votes marked a major breakthrough for Republican legislative leaders, who spent months negotiating over spending levels, tax policy, education, Medicaid oversight, Hurricane Helene recovery, and other major state priorities.
Senate Bill 257 passed the House by a vote of 88-21 and the Senate by a vote of 35-10, one day after clearing initial votes in both chambers. The budget now heads to Stein, who would have until July 12 to sign it, veto it, or allow it to become law without his signature if the bill is presented to him Thursday.
Republican leaders celebrated the final passage of a disciplined budget that addresses affordability concerns while keeping North Carolina on a strong fiscal footing.
“Our state’s fiscal health remains in great shape,” Senate Leader Phil Berger, R-Rockingham, said. “This is a responsible spending plan that takes aim at bureaucratic bloat without endangering core services. This keeps our promise to reduce the tax burden for all North Carolinians, while expanding access to incredible educational opportunities, keeping our communities safe, and solidifying North Carolina’s status as the best state in the nation.”
House Speaker Destin Hall, R-Caldwell, praised the budget as a responsible spending plan for North Carolina families.
“This budget invests in the people of North Carolina,” Hall said. “It delivers historic raises, keeps taxes low, strengthens public safety, and protects taxpayer dollars by making targeted investments to crack down on waste, fraud, and abuse. Every dollar reflects our commitment to build a North Carolina that is a better and more affordable place to live, work, and raise a family.”
Donald Bryson, CEO of the John Locke Foundation, added that the budget includes several reforms that conservatives have long advocated.
“After nearly three years without a new comprehensive state budget, North Carolina taxpayers deserve a budget that advances growth, restraint, and accountability,” Bryson said. “This proposal includes several important reforms the John Locke Foundation supports, including continued income tax relief, a targeted Certificate of Need repeal, stronger Medicaid program integrity, and property-rights protections in local permitting and land-use disputes.”
The plan arrived after North Carolina entered the new fiscal year on Tuesday without a new budget in place. Under state law, North Carolina continued operating under existing budget language.
At the center of the agreement is a familiar Republican budget formula: controlled spending growth, continued tax reductions, targeted raises, and new oversight measures.
The budget continues previously scheduled tax reductions and keeps Opportunity Scholarship funding steady, while also investing in child care, housing, teacher pay, state employee raises, and public safety compensation.
For western North Carolina, the plan includes additional Hurricane Helene recovery funding, building on earlier rounds of disaster aid approved by lawmakers.
Senate Appropriations Chairman Ralph Hise, R-Mitchell, emphasized the budget’s focus on disaster recovery and fiscal discipline.
“This budget supports additional recovery efforts for Western North Carolina following the devastation of Hurricane Helene,” Hise said. “We’ve spent over a decade replenishing our state’s savings account after Democrats drained it, and this budget is no different.”
The budget also includes Medicaid-related guardrails following months of legislative scrutiny over program costs, including the growth of Medicaid-funded autism therapy spending. Supporters say those provisions are designed to strengthen oversight and protect the program’s long-term stability.
Because the bill moved as a conference report, lawmakers voted on the package as a whole rather than offering amendments on the floor. Democrats criticized the process and some policy choices in the plan, but the budget drew relatively limited pushback on its broader topline priorities, including raises, disaster recovery, Medicaid oversight, public safety funding, and continued tax relief.
House Democratic Leader Robert Reives, D-Chatham, called the budget a “mixed bag” and criticized the length of time it took lawmakers to reach an agreement.
“This is not the budget that House Democrats would have written, and as with many of the bills we pass in this General Assembly, it’s a mixed bag,” Reives said. “But this much is true: North Carolina has gone more than 1,000 days without a comprehensive state budget. We were the only state in the nation without one for the entire fiscal year. That is not leadership.”
Reives said rising costs made the delay harder for North Carolinians.
“As grocery prices climbed and health care became less affordable, this General Assembly failed to act,” Reives said. “Leaving working people out to dry for more than a year while a small group negotiated a budget is not the way to govern one of the largest and fastest-growing states in the nation. North Carolinians deserve responsive leadership that shows up to work and actually fights for everyone, not just the well-connected and wealthy.”
Still, Reives acknowledged that some members supported the budget to avoid further delay.
“Any support given for this budget was because we cannot afford further delay, and many of the priorities from the House budget I supported last year were maintained,” Reives said.
The final votes shift the budget debate from the General Assembly to the governor’s office. Stein has not yet said whether he will sign or veto the spending plan, but the broad vote margins in each chamber could signal that the governor may allow the budget to become law.
If Stein signs the budget, or allows it to become law without his signature, it would give North Carolina its first new comprehensive state budget in nearly three years and close one of the defining legislative fights of the session.