Stein signs North Carolina budget after more than 1,000 days without full spending plan
Gov. Josh Stein signed North Carolina’s new state budget Tuesday, putting a comprehensive state spending plan in place for the first time in more than 1,000 days.
The $34 billion budget includes raises for state employees, teachers and some law enforcement officers, while also continuing scheduled income tax reductions. The plan was finalized by Republican legislative leaders last week after months of negotiations and was sent to the governor July 2.
Stein, a Democrat, said Tuesday that he would sign the bill despite concerns about parts of the spending plan.
Stein said the budget includes meaningful investments in community colleges, the Division of Motor Vehicles, child care and summer food programs for children, calling those provisions real wins that justified his signature.
The governor also criticized parts of the spending plan, saying he would not overlook its flaws. He pointed to the elimination of more than 1,000 state government positions and said those cuts could make it harder for state government to meet residents’ health and safety needs.
The budget provides 3% raises for state employees, average raises of about 8% for teachers and raises of up to 17% for some law enforcement officers. It also reduces the personal income tax rate from 3.99% this year to 3.49% next year.
Republicans praised the budget as a plan that delivers pay raises while lowering taxes. Democrats were more divided, with some supporting the bill because of employee raises and delayed agency funding, while others criticized policy provisions included in the more than 600-page measure.
The budget passed both chambers with bipartisan support. The House approved the conference report 88-21, and the Senate approved it 35-10, margins large enough to suggest lawmakers could have overridden a veto if Stein had rejected the bill.
The new spending plan ends a long period of uncertainty for state agencies, schools and employees. North Carolina agencies had been operating under budgets approved in 2023 while lawmakers continued negotiations over a new comprehensive plan.
In addition to raises and tax changes, the budget includes additional funding for Hurricane Helene recovery and Tropical Storm Chantal recovery. The plan includes $151 million in additional Helene recovery funding and $10.7 million for Chantal recovery.
The budget also includes funding for major projects, including a new children’s hospital in Apex, UNC-Chapel Hill’s Carolina North campus and work related to Poe Hall at N.C. State University. It also contains policy changes affecting education, sports betting, prediction markets and state government operations.
The bill, Senate Bill 257, is titled the 2026 Appropriations Act. According to the North Carolina General Assembly, it was presented to the governor on July 2.
With Stein’s signature, the budget is now law.
