Identical to S 652, filed 4/5/23.

Part I

Sets a monthly teacher salary schedule for "A" teachers for 2023-24 for licensed public school personnel classified as teachers, based on years of experience, ranging from $4,100 for teachers with 0 years of experience to $6,000 for 28 or more years of experience. Provides for a 12% salary supplement for licensed teachers who have National Board for Professional Teaching Standards certification; a 10% salary supplement for licensed teachers classified as "M" teachers; a $126 salary supplement for licensed teachers with licensure based on academic preparation at the six-year degree level, in addition to the "M" teachers salary supplement; a $253 salary supplement for licensed teachers with licensure based on academic preparation at the doctoral degree level, in addition to the "M" teachers salary supplement; a 10% salary supplement for certified school nurses; and a $100 salary supplement for school counselors who are licensed as counselors at the master’s degree level or higher.

Requires that the first step of the salary schedule for school psychologists, school speech pathologists licensed at the master's degree level or higher, and school audiologists licensed at the master's degree level or higher, must be equivalent to the sixth step of the "A" salary schedule. Provides for a 10% and $500 salary supplement. Deems these employees eligible to receive salary supplements equivalent to those of teachers for academic preparation at the six-year degree level or the doctoral degree level. Requires that the twenty-sixth step of the salary schedule for school psychologists, school speech pathologists licensed at the master's degree level or higher, and school audiologists licensed at the master's degree level or higher must be 7.5% higher than the salary received by these same employees on the twenty-fifth step of the salary schedule. Provides that in lieu of the amounts of annual longevity payments to teachers paid on the teacher salary schedule, beginning with the 2014-15 fiscal year, the amounts of those longevity payments are included in the monthly amounts under the teacher salary schedule.

Details teacher compensation for the 2023-24 school year based on either (1) the applicable salary schedule; (2) the sum of the salary the teacher received in 2013-14, longevity pay for the 2013-14 school year, and annual bonus provided in SL 2014-100; or (3) the sum of the salary and annual bonus the teacher received in the 2014-15 school year, with the compensation amount determined to be equal to the greater of those amounts. Provides that teacher includes instructional support personnel. Appropriates $673,612,851 million in recurring funds for 2023-24 from the General Fund to the Department of Public Instruction (DPI) to increase salaries for teachers and support personnel.

Part II

Raises salaries for certain individuals whose salaries are (1) set/authorized in this Part under the State Human Resources Act (SHRA) and (2) who are employed in a state-funded position on June 30, 2023, by 5% effective July 1, 2023, in addition to any other raises permitted by law. Raises salaries for certain individuals whose salaries are (1) set/authorized in this Part under the State Human Resources Act (SHRA) and (2) who are employed in a state-funded position on June 30, 2024, by 3% effective July 1, 2024, in addition to any other raises permitted by law.

Allows for permanent part-time employees to receive the increase on a prorated and equitable basis. Specifies that no eligible State-funded employee will be prohibited from receiving the full salary increase solely because the employee’s salary after applying the 5% increase would be above the maximum of the salary range prescribed by the State Human Resources Commission (SHRC). Exempts employees of local boards of education, local community college employees, employees of The University of North Carolina, clerks of superior court compensated under GS 7A-101, certain correctional employees covered by the act, certain law enforcement officers covered by the act, certain probation and parole officers covered by the act, and employees of schools operated by the Department of Health and Human Services (DHHS), the Department of Public Safety (DPS), and the State Board of Education (Board) who are paid based on the Teacher Salary Schedule.

Authorizes state agencies to use the funding allotted to them from the Receipt-Supported Cost-of-Living Adjustment (COLA) Reserve to fundshift a limited number of receipt-supported positions in the General Fund to net appropriation funding.

Replaces references to “longevity pay” in GS Chapter 126 with “retention pay.” Increases retention pay provided to employees who are full-time or over half-time and have a permanent, time-limited or probationary appointment and who are in pay status for one-half of the regularly scheduled workdays and holidays in a pay period ranging from 1% for those employees with two years but less than five years of service to 4.5% for those employees with 25 or more years of service.

Provides for retention bonuses for the 2023-24 fiscal year as follows: (1) the school personnel described in Part I who are SHRA employees and continuously employed by the State or a public school unit from July 1, 2023 to October 31, 2023, a retention bonus of $500 paid during November 2023 (specifies for otherwise eligible local education, employees eligibility for the bonus will be measured beginning not on July 1, 2023, but on the first day when staff report for the 2023-24 school year); (2) the school personnel described in Part I who are SHRA employees and continuously employed by the State or a public school unit from November 1, 2023 to March 31, 2024, a retention bonus of $500 paid during April 2024; (3) all permanent full-time State employees and local education employees who are continuously employed by the State or a public school unit from July 1, 2023, to October 31, 2023, and who earn an annual salary that does not exceed $75,000 must be paid an additional retention bonus of $250 paid during November 2023 by employers of State employees and local education employees; and (4) all permanent full-time State employees and local education employees who are continuously employed by the State or a public school unit from November 1, 2023, to March 31, 2024, and who earn an annual salary that does not exceed $75,000 must be paid an additional retention bonus of $250 paid during April 2024 by employers of State employees and local education employees.  Specifies that the funds appropriated for retention bonuses in excess of the amounts required to implement these bonuses will revert and not be credited to the Pay Plan Reserve. Specifies how bonuses are to be paid and treated in terms of whether they are categorized as salary.

Provides for the following COLAs for community college personnel by the State Board of Community Colleges (SBCC): (1) effective July 1, 2023, a 5% across-the-board increase for all faculty and non-faculty personnel and (2) effective July 1, 2024, a 3% across-the-board increase for all faculty and non-faculty personnel. Sets a minimum salary schedule, based on education, for nine-month, full-time curriculum community college faculty for the 2023-25 fiscal biennium, ranging from $42,267 (FY 23)/$43,535(FY 24) for those with a vocational diploma/certificate or less to $50,928 (FY 23)/$52,456 (FY 24) for those with a doctoral degree.  Specifies that no full-time faculty member may earn less than the minimum salary for their education level. Provides that the pro rata hourly rate of the minimum salary for each education level shall be used to determine the minimum salary for part-time faculty members.

For the UNC system, directs that SHRA employee salaries will be increased as described in the SHRA 5%/3% raise scheme in 2023 and 2024, respectively, set forth above. Authorizes the Board of Governors to provided EHRA employees a salary increase pursuant to policies adopted by the board for one or more of the following purposes: merit pay, across-the-board increases, recruitment bonuses, retention increases, and other compensation increase pursuant to those policies. Requires the Board of Governors to report on the use of compensation to the General Assembly by March 1 of each year of the biennium. 

Sets an annual salary schedule for correctional officers, based on experience and job class, for the 2023-25 fiscal biennium ranging from $36,871 in FY 23 and $39,977 in FY 24 for correctional officers classified as COI to $53,001 in FY 23 and $54,591 in FY 24 for correctional officers classified as COIII.

Sets an annual salary schedule based on the officer's respective work experience, based on experience and job class, for law enforcement officers of the State Highway Patrol, Alcohol Law Enforcement, and the State Bureau of Investigation compensated pursuant to an experience-based salary schedule for the 2023-2025 fiscal biennium ranging from $52,735 in FY 23 and $54,317 in FY 24 for those with 0 years experience and $76,949 in FY 23 and $79,257 in FY 24 for those with 6 years or more of experience.

Sets an annual salary schedule for probation and parole officers, based on experience, for the 2023-25 fiscal biennium ranging from $44,517 in FY 23 and $45,853 in FY 24 for officers with 0 years experience to $64,958 in FY 23 and $66,907 in FY 24 for officers with 6 years or more of experience. 

Specifies that employees of the schools operated by DHHS, DPS, and the Board who are paid on the Teacher Salary Schedule will be paid as authorized by the act and that employees of the School of Science and Mathematics of The University of North Carolina who are paid pursuant to a salary schedule adopted by the North Carolina School of Science and Mathematics Board of Trustees will be paid in accordance with the schedule adopted by that board.

Specifies that the COLAs authorized by the act will be paid on July 1 of each fiscal year of the 2023-25 fiscal year biennium and does not apply to persons who separated from service due to resignation, dismissal, reduction in force, death, or retirement or whose last workday is prior to June 30 of the 2023 and 2024 fiscal years, respectively.  Provides for flexibility by the Director of the Budget (Director) to administer the act. Sets forth provisions related to the effective dates of State employer contribution rates for administrative purposes. Specifies that the administration provisions described in this paragraph apply to all employees paid by State funds, whether or not subject to or exempt from the SHRA, including employees of public schools, community colleges, and The University of North Carolina.  Sets default salary increase date of June 30, 2023 and June 30, 2024, respectively for the following State personnel covered by the 5%/3% raise scheme in 2023 and 2024, respectively, set forth above, unless another requirement applies under other provisions of the act: permanent, full-time State officials and persons whose salaries are set in  accordance with the SHRA, permanent, full-time State officials and persons in positions exempt from the SHRA, permanent, part-time State employees, and temporary and permanent hourly State employees.

Bars state agencies from using funds for salary increases for any other purpose. Requires the Office of Budget and Management (OMB) to ensure the appropriations are being used appropriately. Specifies that funds appropriated for COLAs and employee benefit increases cannot be used to adjust the budgeted salaries of vacant positions or to provide salary increases in excess of those required by the General Assembly except to increase the budgeted salary of any position to the minimum of the position's salary range and to meet retention pay needs. Authorizes the Director to reallocate funds if they find the funds are being used for other purposes.  Specifies that the funds appropriated for COLA and employee benefit increases in excess of the amounts required will be credited to the Pay Plan Reserve. Requires OMB to report to the specified NCGA committee by no later than March 1 of each year of the 2023-25 biennium on the expenditure of funds for legislatively mandated salary increases and employee benefits with four specified matters that must be addressed.

During the 2023-25 fiscal biennium, permits State agencies, departments, institutions, the North Carolina Community College System, and The University of North Carolina to offer State employees the opportunity to use or to cash in special bonus leave benefits that have accrued pursuant to Section 28.3A of SL 2002-126, Section 30.12B(a) of SL 2003-284, Section 29.14A of SL 2005-276, and Section 35.10A of SL 2014-100, but only if all of the following requirements are met: (1) employee participation in the program is voluntary; (2) special leave that is liquidated for cash payment to an employee must be valued at the amount based on the employee's current annual salary rate; and (3) by September 1, 2024, and September 1, 2025, a report on the demographic  information must be submitted to the respective agency head or employing agency and to the Fiscal Research Division.

Specifies that, effective July 1, 2023 and July 1, 2024, respectively, the total of the State’s contribution rates for retirement and related benefits as a percentage of covered salaries for the 2023-24 fiscal year for teachers and State employees (TSERS), State law enforcement officers (LEOs), the University and Community Colleges Optional Retirement Programs (ORPs), the Consolidated Judicial Retirement System (CJRS), and the Legislative Retirement System (LRS) are as follows: 24.62% in FY 23 and 24.51% in FY 24 for TSERS; 29.62% in FY 23 and 29.51% for State LEO’s; 14.07% in FY 23 and 14.25% in FY 24 for ORP’s; 44.38% in FY 23 and 44.56% for CJRS; and 29.17% in FY 23 and 29.35% in FY 24 for LRS. Specifies that the rate for teachers and State employees and State law enforcement officers includes one one-hundredth percent (0.01%) for the Qualified Excess Benefit Arrangement.

Sets maximum annual employer contributions by the State to the State health plan are $7,619 for employees and $5,498 for retirees in FY 23 and $8,153 for employees and $5,641 for retirees in FY 24. Specifies that in applying this to retirees, the annual employer contribution for the average retiree must be calculated assuming the retiree enrollment counts remain at the specified levels.

Amends GS 135-5 (pertaining to benefits under TSERS), GS 135-65 (post retirement increases under CJRS), GS 120-4.22A (post retirement increases under LRS) as follows. From and after July 1, 2023, provides for a 2% COLA for certain beneficiaries who retired on or before July 1, 2022, and for employees who retired after July 1, 2022 and before June 30, 2023. Provides for proration. After September 1, 2023, but on or before October 31, 2023, provides for a one-time 2% COLA supplement payment will be paid on or behalf of living beneficiaries whose retirement began on or before September 1, 2023. Does not allow for proration. Sets forth provisions related to payment if the beneficiary dies before payment is made.  Sets forth a 1% one-time COLA supplement payment to living beneficiaries who are living as of September 1, 2024, and whose retirement began on or before that date. Does not allow for proration. Sets forth provisions related to payment if the beneficiary dies before payment is made. Specifies that no beneficiary will be deemed to have acquired a vested right to any future supplemental payments.

Specifies the following appropriations effective July 1, 2023, to fund the pay increases and cost-of-living adjustments described above. Appropriates from the General Fund to the Reserve for Compensation Increases $666,842,000 in recurring funds for the 2023-24 fiscal year and $568,443,000 in nonrecurring funds for the 2023-24 fiscal year. Appropriates from the General Fund to the Reserve for Compensation Increases the sum of $1,003,074,000 in recurring funds for the 2024-25 fiscal year and $43,466,000 in nonrecurring funds for the 2024-25 fiscal year.

Part III

Appropriates from the General Fund to DHHS $22.7 million in recurring funds for the 23-2024 fiscal year and $36.3 million in recurring funds for the 2024-25 fiscal year to expand the Child Care WAGE$ program, which provides salary supplements for early childhood educators. Requires the funds to be used to provide education-based supplements to low-wage educators and expand the program to all 100 counties in this State. Specifies that the Division must administer the WAGE$ program in the same manner as the Infant-Toddler Educator AWARD$ program.

Part IV

Enacts GS 105-163.6B (providing a tax credit to employers for wages paid). Defines term qualifying taxpayer to mean an employer or payer subject to income tax that has annual receipts for the most recent previous tax year of $8 million or less. Permits qualifying taxpayers to take a credit equal to the lesser of $10,000 or 5% of the wages paid by the qualifying taxpayer during the taxable year. Requires the Secretary to refund the excess to the qualifying taxpayer if the credit plus any other allowable credits exceed the tax imposed. Specifies provisions governing the refundable excess and methods of computation. Provides for substantiation by the qualifying taxpayer upon request of the Secretary. Effective for taxable years beginning on or after January 1, 2024, and sunsets for taxable years beginning on or after January 1, 2027.

Effective July 1, 2023.