NC lawmakers already proposing changes in power, cuts and funding in new budget

Dawn Baumgartner Vaughan, The News & Observer on Jul 28, 2026

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RALEIGH, N.C. — Just when North Carolina seemed finished with the 2026 state budget, lawmakers are pulling it back in.

The Republican-controlled General Assembly adjourned and went home in early July after sending Democratic Gov. Josh Stein an overdue state budget, which he signed into law. The budget spends about $34 billion of taxpayer money and was delayed for a year by GOP in-fighting over taxes and raises.

Now, just a few weeks later, lawmakers want to make some changes, with new legislation moving quickly through the Senate.

House Bill 268 is a technical corrections bill, which means there are indeed some technical changes. That’s standard operating procedure and some of it is just shifting how budget items are coded or extending deadlines.

But over the 51-page document negotiated by Republican House and Senate leaders, there are also shifts in money, power and control. It shifts board appointments but also restores some cuts to programs and vacant jobs, and adds policy like excused religious instruction time in public schools.

Here are major changes in the legislation:

More power, control shifts over appointments, property

—Under the pending budget adjustment bill, the Secretary of State, currently Democrat Elaine Marshall, is removed from the executive board of the Local Government Commission, which includes the state auditor, treasurer and secretary of revenue.

—Marshall’s seat will be filled by an appointment from the legislature recommended by the Senate president pro tempore, who is Republican Sen. Phil Berger.

—Stein’s appointment to the Local Government Commission will need to be confirmed by the General Assembly and have served as a mayor or other member of a city’s governing board for a four-year term.

—This follows other appointment power and control shifted from Council of State Democrats to Republicans in the overall budget bill that Stein signed.

—The budget that is now law also shifted some control over property from the Department of Administration, which is a Cabinet agency of the Stein administration, and gave it to offices held by Republicans: State Auditor Dave Boliek, Labor Commissioner Luke Farley and State Treasurer Brad Briner. The new bill adds the State Bureau of Investigation and State Highway Patrol to the list of exempt agencies that can choose to bypass DOA oversight on purchasing, contracts, acquisition and maintenance of property, as well as office space leases.

Restores some job, program cuts in budget

—The new state budget cut some vacant state employee jobs, but this bill restores $3,757,559 in vacant position cuts at the Department of Agriculture and Consumer Services. Republican Steve Troxler is agriculture commissioner.

—The legislation also restores $188,431 in recurring funds to the Department of Commerce for the Energy and Infrastructure Office, which had been cut.

—Funding would also be restored to the Department of Natural and Cultural Resources — $481,965 — in recurring money for the Office of Education and Outreach, also known as Learning Happens Here. Both Commerce and Cultural Resources are part of the Stein administration.

—Some staffing cuts in the Department of Insurance would also be restored, changing the amount of cuts from $2.7 million to $.15 million. DOI is led by Republican Insurance Commissioner Mike Causey.

New funding for Military World Games, film grants

—The 2027 Military World Games would receive $25 million in state funding for North Carolina to host the games next year, if certain benchmarks are met. The games will be hosted by UNC Charlotte.

—The Film and Entertainment Grant Fund would also get an influx of $15 million.

Debate grants, Dolly Parton library and religious instruction time

—The budget establishes a grant program for competitive speech and debate teams in high schools for the 2026-27 school year, which will be administered by the Department of Public Instruction. The grants of up to $10,000 each year include coach stipends and travel to competitions.

—It also extends funding to Dolly Parton’s Imagination Library to 2032, rather than the current status of reverting in 2027.

—Under current law, public schools must excuse up to an hour of missed class time for religious instruction per week. The new bill, if it becomes law, would increase that time to up to four hours a week.

What’s next

The Senate came back to work this week and quickly moved the bill as soon as it became public, with plans to approve the bill before they adjourn for another break.

But the House won’t return until next week, when it plans to take up the measure on Aug. 4.

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