House committee substitute replaces the 1st edition in its entirety with the following. Makes conforming changes to the act’s long and short titles.  

Part I.

Section 1.1.

Appropriates from the General Fund to the Department of Health and Human Services (DHHS), Division of Health Benefits (DHB), $500 million in recurring funds and associated receipts for each year of the 2025-27 fiscal biennium to adjust Medicaid funding to account for projected changes in enrollment, enrollment mix, service and capitation costs, and federal match rates, as well as the implementation of the Children and Families Specialty Plan in December 2025 or for contracts needed to operate the State’s Medicaid managed care program.

Part II.

Section 2.1.

Appropriates $2.25 million from the General Fund to the Office of State Auditor (Auditor) in recurring funds for each year of the 2025-27 biennium to fund up to 25 additional positions, including salaries, benefits, and operating costs.

Section 2.2.

Appropriates $1,193,979 in recurring funds from the General Fund to the State Board of Elections (SBE) for each fiscal year of the 2025-2027 fiscal biennium to provide funds for the specified seven new exempt positions.

Amends GS 126-5 to also give the Executive Director of the State Board of Elections sole authority to set the salary of its exempt policy making and exempt managerial positions, within the specified range. Also allows the Executive Director to designate exempt positions. Limits the total number of exempt positions, policymaking and managerial, that are designated by the Executive Director to the seven listed positions. Provides the process for filing a vacancy in the Executive Director position.

Section 2.3.

Appropriates $1.5 million for 2025-26 from the General Fund to SBE for future litigation needs. Specifies that the funds remain available until expended.

Section 2.4.

Appropriates $15 million for 2025-26 from the Information Technology Reserve to SBE to complete the State Election Information Management System upgrade and campaign finance software update.

Section 2.5.

Instructs the Department of Administration (DOA) to assign the described sections of the Albemarle Building in Raleigh to the SBE. Directs SBE to complete its move to the Albemarle Building by October 31, 2025. Provides for the State owned equipment, furnishings, and other fixtures in the property on the date of the section’s effective date to remain for the SBE’s use. Clarifies that the act does not prohibit the disposal, removal, or replacement of the equipment, furnishings, and other fixtures described after the SBE has moved into the space described. Appropriates $1 million for 2025-26 from the General Fund to the SBE for relocation to the Albemarle Building.

Part III.

Section 3.1.

Appropriates $713,720,811 for 2025-26 from the State Capital and Infrastructure Fund to the 35 listed project codes in the specified amounts.

Directs UNC’s Board of Governors to prioritize funds allocated for UNC/R&R21 for repairs and renovations and for the capital improvement projects listed in SL 2021-180. Caps the cost of any single repair or renovation at $15 million. Allows for reallocation of funds by the Board of Governors, as specified, so long as the funds are reallocated to the specific constituent institution for which it was originally allocated. Directs the Board of Governors to report the specified NCGA commission under GS 143-C-8-13.

Applies the provisions of Section 40.1(c) of SL 2021-180 (outlining repair and renovation caps, reporting requirement, and legal authority) to the funds allocated for project code R&R21 for the 2025-27 fiscal biennium.

Appropriates $1.64 million for 2025-26 from the State Capital and Infrastructure Fund to OSBM to be allocated to the NC School of Science and Math for temporary housing. Assigns the project a project code, and caps the maximum project authorization at $2.18 million.

Section 3.2(a).

Effective for the 2025-2027 fiscal biennium, requires that required employer salary-related contributions for employees whose salaries are paid from department, office, institution, or agency receipts must be paid from the same source as the source of the employee's salary. Provides for when an employee’s salary is in part from the General Fund or Highway Fund. Applies the section’s requirements to payments on behalf of the employee for hospital medical benefits, longevity pay, unemployment compensation, accumulated leave, workers' compensation, severance pay, separation allowances, and applicable disability income benefits.

Section 3.2(b).

Effective July 1, 2025, sets forth State employer contribution rates budgeted for retirement, health, and related benefits as a percentage of covered salaries for the 2025-2026 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), in the specified amounts, and which include contributions for the Employee Health Benefit Fund and Retiree Health Benefit Fund.

Section 3.2(b1).

Provides that if House Bill 192, 2025 Regular Session becomes law, then Section 3.2(b) is repealed and sets forth State employer contribution rates budgeted for retirement, health, and related benefits as a higher percentage of covered salaries for the 2025-2026 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), in the specified amounts, and which include contributions for the Employee Health Benefit Fund and Retiree Health Benefit Fund.

Section 3.2(c).

Effective July 1, 2025, caps annual employer monthly contributions for 2025-27 by the State to the North Carolina State Health Plan for Teachers and State Employees for each covered employee is a maximum $8,500.

Section 3.2(d).

Amends GS 135-151 (pertaining to the Qualified Excess Benefit Arrangement (QEBA) under TSERS) to allow for a portion of the employer contribution rate to be deposited into a separate fund, not to exceed the amount specified. Makes a clarifying change.

Section 3.2(e).

Increases the State contribution to the NC Firefighters' and Rescue Squad Workers' Pension Fund by $350,000 in recurring funds for 2025-27 resulting in a total State contribution of $20,752,208 for each fiscal year.

Section 3.3.

Transfers $197,563,133 from the General Fund to a Benefits Contributions Reserve in OSBM in recurring funds to be distributed accordingly to account for the State contributions required by this Part and the funds distributed are appropriated for this purpose.

Part IV.

Section 4.1.

Directs the State Controller to transfer $20 million of the funds allocated to DEQ from the State Capital and Infrastructure Fund to Robeson County for 2025-26 for State matching requirements for federal funding for the community-led Lumber River Basin Coalition waterway restoration project due to damage from Potential Tropical Cyclone 41 and Tropical Storm Debby. Requires that remaining unspent funds appropriated under this section revert to the Savings Reserve if not used to draw down federal funds before the expiration of the federal deadline to receive those funds.

Section 4.2.

Appropriates $142 million from the State Emergency Response and Disaster Relief Fund to the Department of Agriculture and Consumer Services (DACS) for 2025-26 for the Agricultural Disaster Crop Loss Program (Program) for verifiable losses from an agricultural disaster in 2024. Clarifies that the appropriated funds are subject to all of the requirements of the Program’s enabling act, except for provisions allowing the Commissioner of Agriculture to use funds appropriated for the Program for purposes related to Hurricane Helene recovery for farmers, including storm debris removal, streambank restoration, stream restoration, and cropland restoration in the affected area, if the applicant under this Program identifies that unmet need.

Section 4.3.

Requires recipients of State funds under the act to use best efforts and take all reasonable steps to obtain alternative funds to cover losses or needs for which State funds are provided, including insurance funds. Requires institutions of higher education or non-State entities to seek private donations to help cover the losses or needs for which Sate funds are provided.  Provides for notice to State aid recipients of this requirement.  Specifies that State funds paid under this Part are declared to be excess over funds received by a recipient from the settlement of a claim for loss or damage covered under the recipient’s applicable insurance policy in effect or federal aid. Requires recipients of alternative funds to remit the funds to the State agency from which the State funds were received not exceeding the amount of State funds provided to the recipient. Directs that any contract or other instrument entered into for the receipt of funds to include the alternate funds requirements set out above. Prevents the Governor from using the funds described in Part 4.3 to make budget adjustments or reallocations. Direct the Governor to ensure that funds allocated in the Part are expended in such a manner that does not adversely affect any person's or entity's eligibility for federal funds that are made available, or are anticipated to be made available, as a result of natural disasters and to avoid using State funds to cover costs that will, or likely will, be covered by federal funds. Requires OSBM to add the appropriations and allocations provided for in this Part to the reporting requirements set forth in Section 4.1(g) of SL 2025-2 (2025 Helene Relief Package I). Requires the Governor to continue the reporting requirements set forth in Section 4.2 of SL 2025-2. Directs the State Auditor to include all funds appropriated and allocated under this act in its report to the described NCGA committee.

Section 4.4.

Specifies that if Senate Bill 401, 2025 Regular Session, becomes law, then Part II of that act is repealed (entitled, “align dealer registration plate renewal with dealer license renewals”).

Part V.

Effective July 1, 2025, except as otherwise provided.