Contrary to our federal counterparts, North Carolina must pass a balanced budget and is prohibited from carrying a deficit over into the following year. The state operates on a biennial budget, which means our state budget covers two fiscal years, though adjustments can be made to the budget for the second year. With the new fiscal year beginning on July 1, June 30 is a looming deadline for the North Carolina budget process.

Here’s a look at where things stand.

House Budget

The House budget proposal, passed in late May, includes a number of policies that are encouraging for economic growth.

• Prioritizing Western North Carolina’s recovery is critical to North Carolina’s economy. A report from TRIP, released last week, highlighted, “North Carolina faces significant costs to address the damage caused by Hurricane Helene. While the federal government is expected to cover the largest share of the cost, additional storm-related expenditures by the state will leave less funding available for needed improvements and repairs to the transportation network in other areas of the state as the funds are redirected to hurricane recovery efforts.”
• Health and human services reforms expand child care access, increase provider rates, enhance NC Pre-K, and streamline child care regulation, much of which is consistent with the NC Chamber’s 2025 Legislative Agenda.

Senate Budget

The Senate budget proposal, passed in April, also prioritized hurricane recovery, in addition to pro-growth policy around the franchise tax, workforce measures, and agricultural provisions. Read more on those here.

What’s Next

The two chambers remain far apart, particularly as it relates to tax policy, which is critical for our state’s economic growth. Ultimately, Governor Stein also casts a vote as the final proposal will land on his desk.

In the meantime, the business community urges our state’s leaders to continue the dialogue and remain future focused.

Don’t Forget

While the budget process takes up the most headlines, there are countless other policies being worked by your NC Chamber team. Learn more about what remains on the table.