North Carolina Senate President Pro Tem Phil Berger (R-Rockingham) holds a press conference on Senate Republicans' budget proposal on Monday, April 14, 2025. (Photo: Galen Bacharier/NC Newsline)
Republicans in the North Carolina Senate released their blueprint for state spending Monday evening, outlining a budget that raises pay for teachers and state workers, moves ahead with planned income tax cuts and sets aside money for future Hurricane Helene recovery spending.
The new plan from the GOP majority came with a pledge from its leader that legislators would eliminate “waste” and “bloated” spending from state government.
The two-year budget proposal sets out modest increases in spending, totaling $32.6 billion in 2025-26 and $33.3 billion the year after.
“Without a doubt, this is one of the fastest timelines that we’ve seen for pulling a budget together,” said Senate President Pro Tem Phil Berger (R-Rockingham) during a press conference.
Senators will begin moving the budget through their chamber this week; it is set for its first hearing Tuesday morning. When it passes the full Senate, it will move to the House. Leaders have agreed to a top-line spending total with the Senate, but the NC House will make changes and additions of their own.
Gov. Josh Stein, a Democrat, has requested that the GOP-led legislature approve more extensive pay raises, spending on child care and affordable housing.
Senate Democratic Leader Sydney Batch strongly criticized the plan Monday, calling it a “blueprint for neglect and cowardice.” She said it offered “pathetic raises” to public servants and “shortchanges” infrastructure needs.
“Budgets reflect priorities,” Batch said. “And this one, unfortunately, sends a loud, clear message about what my Republican colleagues care about: protecting the wealthy, ignoring working families, and leaving workers behind.”
Pay raises for teachers, state workers
The Senate Republicans’ budget would increase salaries for teachers, law enforcement and government workers over the next two years.
Educators would receive an average 2.3% pay increase next year, and an average 3.5% total increase over the next two years. They’ll also receive a $3,000 bonus over the next two years.
That would bring the average teacher salary in the state to $62,407, according to Berger.
Most state workers would see a 1.25% raise next year, as well as a $3,000 bonus over the next two years. That’s in addition to raises for correctional officers, probation and parole officers, state-funded nurses and other workers.
“This makes concerted efforts to target funds to areas with the most pressing workforce shortages,” Berger said.
Setting aside money for future Helene recovery
State lawmakers have thus far spent about $1.4 billion on recovery from Hurricane Helene in western North Carolina. Any future spending will likely come in a separate bill — but Senate Republicans would set aside another $700 million for future relief spending.
In the meantime, some money would flow to western colleges and Stein’s teams spearheading recovery efforts.
The state is facing major uncertainty on the federal level, with FEMA ending its cost-share and other programs and no new congressional spending on the horizon.
“We remain hopeful that the federal government will provide increased and expedited reimbursement,” Sen. Ralph Hise (R-Mitchell). “But we must be prepared to fend for ourselves.”
Income tax cuts continue, and pledge to cut ‘waste’
The governor has urged lawmakers to pause a series of planned cuts to the state’s income tax rate. He points to a joint forecast of legislative and executive branch economists who predict a shortfall in the coming years.
The Senate Republicans’ budget effectively doubles down on those tax cuts, guaranteeing they take effect in 2027 and 2028 and adding two more triggered cuts in years down the line.
Berger, who has been a leading advocate for the cuts, said Monday he was skeptical of the joint forecast, saying he had “rejected it in the past.” It was used to model this year’s budget, he said, but that he did not have confidence in its accuracy long-term.
“What we have seen is the state’s economy continuing to grow and flourish,” Berger said.
And echoing sentiments on the federal level, Berger said their budget would target “waste” within state government to curb unnecessary spending. He did not provide specifics Monday on what those eliminations might look like, besides a proposal to consolidate community colleges’ administration.
Much of it could come from eliminating long-empty jobs. The budget plan lays out workforce reductions in many departments and agencies that have struggled to chip away at a 20% vacancy rate. It’s not clear as of Monday evening whether those cuts could impact currently employed workers as well.
Health care, Rainy Day funds and DEQ
The Senate Republicans’ budget proposal also :
Requests the Department of Health & Human Services to add work requirements to Medicaid, and repeal “certificate of need” requirement for health care facilities. Continues to fund NC Innovation, the private research nonprofit that has come under scrutiny by lawmakers, but changes the way it’s funded. Sets out $638 million for a new children’s hospital in the Triangle. It would be funded through an ARPA fund and money transferred from NC Innovation to the UNC Board of Governors. Replenishes the state’s “Rainy Day” reserves fund to $4.75 billion — its level before Hurricane Helene. Orders a “comprehensive review” of academic programs across the UNC System. Provides $110 million over two years to the Department of Environmental Quality to send grants for PFAS sampling and monitoring. Lays out $1.5 billion in federal dollars for rural broadband internet. Read More Details
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