Requires the North Carolina Child Support Services Section (NCCSS) of the Department of Health and Human Services, Division of Social Services, to retain up to 15% of the annual federal incentive payments it receives from the federal government to enhance centralized child support services. Requires NCCSS to: (1) in consultation with representatives from county child support services programs, identify how federal incentive funding could improve centralized services; (2) use federal incentive funds to improve the effectiveness of the State's centralized child support services by supplementing and not supplanting State expenditures; (3) develop and implement rules that explain the State process for calculating and distributing federal incentive funding to county child support services programs.

Requires NCCSS to allocate no less than 85% of the annual federal incentive payments it receives from the federal government to county child support services programs to improve effectiveness and efficiency using the federal performance measures. Requires NCCSS to: (1) in consultation with representatives from county child support services programs, examine the current methodology for distributing federal incentive funding to the county programs and determine whether an alternative formula would be appropriate, requiring NCCSS to use its current distribution formula until an alternative formula is adopted; and (2) upon adopting an alternative formula, develop a process to phase in the alternative formula over a four year period.

Requires NCCSS to establish guidelines that identify appropriate uses for federal incentive funding. Requires NCCSS to require county child support services programs to comply with each of the following: (1) submit an annual plan describing how federal incentive funding would improve program effectiveness and efficiency as a condition of receiving federal incentive funding; and (2) report annually on: how federal incentive funding has improved program effectiveness and efficiency and been reinvested into their programs, provide documentation that the funds were spent according to their annual plans, and explain any deviations from their plans.

Requires NCCSS to develop an implementation plan and to submit a progress report on the plan to the Joint Legislative Oversight Committee on Health and Human Services and the Fiscal Research Division by November 1, 2015. After implementing the plan, requires NCCSS to submit a report on federal child support incentive funding to the Joint Legislative Oversight Committee on Health and Human Services and the Fiscal Research Division by November 1 of each year. Sets out items that must be included in the report.

Effective July 1, 2015.