January 11, 2025

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The 2025-26 Legislative Session Has Started!

The North Carolina General Assembly officially started its 2025-26 biennium
session on Wednesday, January 8. This year—the first in the two-year
cycle—features the legislative long session, which is scheduled to run
through June. If all goes well, the next two-year budget will be in place
in time for the July 1 start of the 2025-26 fiscal year.

During Wednesday’s House and Senate sessions, Secretary of State Elaine
Marshall certified last year’s election results and all members were
officially sworn in.

Members then elected leaders for their respective chambers. Representative
Destin Hall (R-Caldwell) was elected to replace former House Speaker Tim
Moore, who was elected to the U.S. House of Representative in November.
After being sworn in, Hall gave a welcome speech that outlined several
priorities for the upcoming session. Top priority will be doing all they
can to rebuild Western North Carolina. He also highlighted the importance
of strong educational choices and providing for every school to have its
own resource officer.

In the Senate, Senator Phil Berger (R- Rockingham) was re-elected as
President Pro Tempore. Senator Berger also spoke of the need to provide
more hurricane relief to affected areas.

Rachel Hunt made her inaugural appearance as the newly elected Lieutenant
Governor. In this role, she serves as the president of the Senate, a
non-voting position except as needed to break a tie. In her opening
remarks, Hunt reflected on the powerful example provided by her father,
former Governor Jim Hunt in his “commitment to bettering the lives of North
Carolinians in everything from [7]public education to creating good-paying
jobs.

Legislative leaders have made their job of finding funding for hurricane
relief more challenging by previously legislating an automatic tax cut for
individuals and corporations which will limit state revenue. On January 1,
the corporate income tax rate dropped from 2.5 percent (lowest in the
nation) to 2.25 percent and is scheduled to drop to zero by 2030. The rate
for individuals dropped from 4.5 percent to 4.25 percent, a much higher
rate than corporations. The [8]NC Budget & Tax Center has calculated that
the scheduled tax cuts will cost the state at least $8 billion in revenue
each year.

Legislators have also committed [9]$675 million for the 2025-26 school year
for NC’s two voucher programs, tying up resources that could instead be
spent on public school and community recovery efforts.

An ongoing [10]shortfall in the State Health Plan that is expected to grow
from its current $507 million to $1.4 billion in a few years will present
legislators with even more difficult budget decisions in this year's
session.

NC legislators have been waiting on federal action before committing more
state funds to disaster relief. They welcomed news of the federal
government’s American Relief Act, 2025 (a continuing resolution to fund the
federal government through March 2025) signed into law in December. The ARA
[11]contains over $100 billion for critical disaster programs including $29
billion for FEMA’s disaster relief fund.

With federal funds now in the pipeline, the [12]House Select Committee on
Helene Recovery will begin to work in earnest. Their first meeting was held
in December.

What About the NC Lottery Money?

The North Carolina Education Lottery was created in 2005 with the hope of
bolstering revenue for public education in the state. Originally, 35% of
lottery proceeds were required to go to education. However, in 2007, the
legislature changed this requirement to a guideline. As a result, the
percentage of lottery revenue allocated to education spending has decreased
in recent years. By fiscal year 2022-23, the percentage allocated for
education had dropped to 23%. In fiscal year 2023-24 it dropped further, to
20.3% ([13]Read our fact sheet.).

Total revenue for the lottery in FY 2023-24 was 5.38 billion; $1.09 billion
went to education. The funds were spent in five areas designated by the
legislature.
* 51% to school construction ($561.3 million)
* 35% to non-instructional support personnel ($385.9 million)
* 8% to NC Pre-K ($78.2 million)
* 4% to college scholarships ($41.2 million)
* 2% to LEA transportation ($21.4 million)

Unfortunately, North Carolinians often look to the lottery to solve funding
needs. Even if the lottery gave the originally required 35% of its revenue
to schools (which would total $1.88 billion for FY 2023-24), it would only
cover about 16% of the [14]state’s total budget for K-12 public schools.
Lottery funds do not always go to the highest need areas because state
legislators control allocations. Many areas of need in NC’s education
system at present are poorly funded or not funded at all. More investment
is needed to raise NC schools to funding levels they need to support all
children in receiving an equitable and effective public education.

Legislative and SBE Updates

The 2025-26 legislative long session started this week. After a day of
swearing in members and electing new leaders, both chambers adjourned until
January 29.

The Charter Schools Review Board meets on Monday, January 13 for its
regular monthly meeting ([15]agenda and [16]livestream).

The State Board of Education met for the first time with Mo Green present
as the state's new superintendent of public instruction. In his remarks,
[17]Green presented his wish list for requests to the legislature:
* Raising teacher pay
* Reinstating higher pay for teachers with master’s degrees
* Increased state funding for the state health plan to alleviate
anticipated premium raises
* Granting schools calendar flexibility
* Redesigning school performance grades
* Extension of free meals to more students through federal programs
* Expansion of the advanced teaching roles model to more schools
* Funding more school psychologists, social workers, and nurses to bring
their ratios to students closer to national recommendations
* Conducting a statewide assessment on the condition of school buildings

Green has already released his [18]"entry plan" that sets out goals,
objectives, major activities, and a timetable for transition to NC
Superintendent of Public Instruction. Green will hold listening sessions
throughout the state from January through March. He has also created a
"[19]Mo Wants to Know" comment page at the bottom of his "About" page to
collect comments from the public.

Did You Know?

North Carolina's minimum wage hasn't changed since 2008?

Minimum wage in NC is still $7.25 per hour.

It's even worse for employees who receive tips. According to the [20]NC
Department of Labor, employees who receive tips can legally earn a wage as
low as $2.13 an hour as long as the employee receives enough in tips to
make up the difference between the wages paid and minimum wage.

In other words, the employer pays just $2.13/hour and the consumer makes up
the difference (through tipping) up to and beyond the $7.25/hour minimum
wage.

In 2025, [21]21 states are raising their minimum wage. Contact your
legislators if you think NC should join them.

What is the Living Income Standard in Your County?

The NC Budget & Tax Center just released their [22]2025 Living Income
Standard dashboard and tool. It enables you to determine what it actually
takes to make ends meet in each NC county for various family sizes.

For example, for a family of five (two working adults, three children) in
Bertie County to cover the basic needs of a modest lifestyle with very
little financial cushion against emergencies, the household would require a
$7,780 monthly income.

The two adults would each need to have an hourly wage of at least $22.40 to
make ends meet working full time. If they both make the minimum wage, they
would need to work a total of 248 hours per week to make ends meet.

What is the living income standard in your county? Check out their new tool
to find out.

In Case You Missed It

[23]Most NC schools can't afford new computers for students. Should the
state pay for them?

[24]Sedalia Elementary closed and Page High on remote learning with HVAC
issues Remote learning requires students to have functional computers. See
previous article.

[25]NCDPI launches $25 million initiative to improve school improvement
with Golden LEAF Foundation Support

[26]'Uncomfortable things' necessary to fix NC Health Plan, new treasurer
says

[27]NC Supreme Court delays certification in Riggs-Griffin race for at
least two weeks

[28]A charter school in Arizona will teach its academic curriculum entirely
by AI

Don't Miss Our Webinar: The Cost of Conflict

February 6 (Th), 7:00-8:30 p.m.

Join us for a conversation with Dr. Rachel White (University of Texas at
Austin) and Dr. Rebecca Jacobsen (Michigan State University). Both
researchers will share their recent work: Dr. White’s study “The Cost of
Conflict,” and Dr. Jacobsen’s upcoming book “The Politics of Disruption.”

Their work details how much the politics of disruption are costing public
schools and how the disruption is negatively impacting school boards and
eroding community trust. The consequences of our school/education wars are
real. Finding ways to resolve conflicts and work together to protect and
strengthen our public schools are essential if we want to provide all
children a high-quality, free and inclusive public education. There will be
time allotted for questions and answers. To prepare for the discussion,
read the report:

[29]REGISTER HERE

Fight Vouchers in 2025!

The Public Funds Public Schools webinar series continues in 2025! The first
webinar of the year takes on the escalating threats posed by private school
vouchers: How to Fight Vouchers in 2025: A Toolkit for Advocates.

The webinar, on Wednesday, January 15, at 2 p.m. ET, features
representatives from PFPS and invited guests who will share information,
resources, tools, and tips to help advocates prepare for crucial state and
federal legislative fights over private school voucher programs in 2025.

Highlights include:
* An overview of PFPS advocacy tools, including demonstrations of the
PFPS bill tracker and our new private and public school student enrollment
data tool;
* Insights from Education Law Center Senior Fellow Josh Cowen, a leading
national expert on private school vouchers; and
* A presentation by Nicole Fuller of the National Coalition for Public
Education on federal voucher legislation and resources to fight voucher
bills.

The webinar will be moderated by PFPS Director Jessica Levin.

[30]REGISTER HERE

Words to Remember

“In public schools, students have numerous constitutional rights, including
equal protection, due process, free speech, and both free exercise of
religion and freedom from religion. None of these constitutional
protections apply in private schools.”

— The School Voucher Illusion, p. 81

Help us support public schools!

Public Schools First NC is a statewide nonpartisan, 501(c)(3) nonprofit
focused solely

on pre-K to 12 public education issues. We collaborate with parents,
teachers, business and civic leaders, and communities across North Carolina
to advocate for one unified system of public education that prepares each
child for productive citizenship.

[31]DONATE HERE

[32]www.publicschoolsfirstnc.org

Questions? Contact us today at [email protected]

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