The N.C. House began releasing its budget proposal Thursday, and Republicans are planning cuts in what's expected to be a tight budget year.
Lawmakers got their first look at parts of the spending plan during a series of subcommittee meetings. The full budget bill, including tax changes and raises for state employees, is expected to be released Monday. House Speaker Destin Hall has said he expects raises to be larger than what the Senate and Gov. Josh Stein's budget proposed.
"I think state employees and teachers are going to be very happy with the House budget," he told reporters. "They're certainly going to like ours the most."
While Gov. Josh Stein is calling on lawmakers to pause scheduled corporate and personal income tax cuts to avoid possible revenue declines, the Senate's budget kept the tax cuts, and it's unclear so far if the House will as well.
Rep. Donny Lambeth, R-Forsyth, is one of the lead budget writers, and he says they had less revenue to work with than in past years. Budget writers overseeing healthcare spending, for example, were told to make overall cuts of about $70 million over two years.
"Are there cuts in here that I don't like? Absolutely," Lambeth told a healthcare subcommittee. "But we're up against a really challenging time economically, with the economy slowing down, and we just had to balance out a lot of priorities."
On the chopping block
Among the notable cuts in the portions of the legislation released Thursday, the House budget bill would:
- Cut Medicaid coverage for expensive new weight loss drugs known as GLP-1 drugs. The State Health Plan had also cut coverage for those medications, citing the high cost. The change is estimated to save the Medicaid budget about $28 million over two years.
- Eliminate the state's Office of Health Equity
- Eliminate vacant positions across many state agencies, including correctional officers. The Senate included similar cuts in its budget
- Require that the Department of Environmental Quality trim enough vacant positions to save $2.6 million a year, in addition to more specific cuts
- Eliminate the offices of Environmental Education and Environmental Justice at DEQ
- Shift $6.9 million of sports gambling money away from a fund that attracts events, games and attractions to North Carolina
- Drop the budget for the Job Development Investment Grant program, the state's main incentive program to lure major employers, by $10 million a year, a 14% reduction
- Cut $500 million for the N.C. Innovation program, which was created to help start-ups stemming from university research. Its money would be redirected to Helene recovery projects.
- Cut a program that uses Medically Assisted Treatment in jails to treat opioid users
New proposed state spending
But budget writers did find funding for some additional spending beyond what's currently allocated. The plan would:
- Add more childcare subsidies by increasing reimbursement rates, an effort to deal with funding shortfalls at childcare facilities.
- Open three new DMV offices to reduce wait times, including locations in Fuquay-Varina, Cabarrus County and Brunswick County
- Give the North Carolina Zoo extra money to pay for its Asia exhibit, opening in 2026. Over $5.6 million would be added to the state's annual zoo spending, plus $1 million this year.
- Establish the new Brushy Mountain State Natural Area with a $1.2 million land buy
- Set aside $2.5 million for commercial drivers license training programs
- Provide grants to a number of private colleges and universities, as well as a grant for the Winston-Salem Speedway
- Provide $100,000 to extend operating hours at the Legislative Building's snack bar, ensuring chicken fingers and cheeseburgers are available whenever legislative sessions run late
Once the full House budget bill is released Monday, lawmakers are scheduled to vote on it Wednesday and Thursday. From there, House and Senate budget writers will meet privately to come up with a compromise budget bill, with the goal of sending a final measure to the governor by the time the new fiscal year begins July 1.
