Conference committee substitute replaces the 3rd edition in its entirety with the following. Makes conforming changes to the act’s long and short titles.

Part I.

Section 1.1.  

Extends the June 30, 2026, reversion date for those directed grants to non-state entities by one year in Section 5.3 of SL 2023-134, as amended. Makes conforming changes.

Extends the reversion date established in SL 2025-4 for certain grants to non-state entities appropriated in SL 2022-74 from the end of the 2025-26 year to the end of the 2026-27 year.

Effective June 30, 2026.

Part II.

Section 2.1.

Establishes the NC Blue Ribbon Commission on Public Education (Commission), consisting of 29 members (19 of whom are voting members and 10 of whom are non-voting members). Provides for joint appointment of membership by the President Pro Tempore of the Senate, the Speaker of the House of Representatives, and the Governor, as described. Provides terms, committee chairs, vacancies, and sets quorum. Tasks the Committee with studying the infrastructure and implementation of public education in the State, including examining the four matters listed. Requires the Friday Institute for Educational Innovation at NCSU (Friday Institute) to provide assistance to the Commission. Provides for other professional and clerical staff to be assigned by the Legislative Services Officer (LSO). Provides for compensation. Authorizes the Commission to submit interim and final reports on its work, including any proposed recommendations to the NCGA and the Governor. Terminates the Commission on March 1, 2027.

Appropriates $300,000 from the General Fund to the UNC Board of Governors for 2025-26 to be allocated to the Friday Institute for the administration of the Commission. Specifies that the funds do not revert until June 30, 2027.

Section 2.2.

Changes the definition of code in GS 116-209.25(b) (concerning the parental education expenses trust fund) so that it aligns with the Internal Revenue Code as enacted as of July 4, 2025, including any provisions enacted as of that date that become effective either before or after that date (was, code meaning was as defined in GS 105-228.90).

Section 2.3.

Appropriates $1 million from the General Fund to the UNC Board of Governors (BOG) for 2025-26 to be allocated to the State Education Assistance Authority (Authority) to increase award amounts for recipients of scholarships for the children of wartime veterans for the 2025-26 academic year up to the full amounts permitted, to the extent those awards were reduced by the Secretary of the Department of Military and Veterans Affairs (Secretary). Authorizes the Authority to use any remaining funds to award additional scholarships for the above qualifying children beginning in the 2026-27 academic year.

Section 2.4.

Effective July 1, 2026, authorizes the Secretary to increase the number of the described scholarship classes for new applications for children of wartime veterans from 100 to 200 children in each class for the 2026-27 academic year. Appropriates $10 million from the Escheat Fund to the BOG in recurring funds beginning in 2026-27 to be allocated to the Authority to support the additional scholarships.

Section 2.5.

Extends the provisions of Section 6 of SL 2025-72, which allows for additional awards under the Children of Wartime Veterans Scholarship to those children notwithstanding existing provisions of GS Chapter 143B and any rules thereunder, so that it also applies in the 2026-27 academic year. For the 2026-27 academic year only, authorizes the Secretary to determine whether to prioritize awards of scholarships for new applicants who apply to receive scholarships as undergraduates, qualify as residents for tuition purposes, and are otherwise eligible to receive scholarships in line with Program requirements. For the 2026-27 academic year only, also authorizes the Secretary to determine whether to establish a standardized payment schedule or formula within available funds for the academic year to ensure the efficient and effective administration of the scholarships. Specifies that the authorization to the Secretary to consult with the Authority on whether to reduce the room and board allowance only applies for the 2025-26 academic year. Authorizes the Secretary to establish a lottery for selection of scholarship students, in addition to existing authorization of pro rata scholarship awards. Makes technical and conforming changes.

Part III.

Part III-A.

Section 3A.1.

Sets forth six definitions that apply in Part III, including NC RHTP (NC Carolina Rural Health Transformation Plan approved and funded by CMS as part of the Rural Health Transformation Program); Public Law 119-21 (The Reconciliation Act of 2025, Public Law 119-21,139 Stat. 72 (2025), also known as the "One Big Beautiful Bill Act"); RHTP or Rural Health Transformation Program (the Rural Health Transformation Program authorized by section 71401 of Public Law 119-21 and administered by CMS); and subrecipient (a nonfederal entity that receives a subaward from the North Carolina Department of Health and Human Services (DHHS) to carry out activities related to the NC Rural Health Transformation Plan).

Part III-B.

Section 3B.1.

Sets forth a schedule for DHHS to submit periodic progress reports to the specified NCGA commission on the implementation status of NC RHTP spanning from reports due on November 29, 2026, (for the August 1 through October 30, 2026 reporting period) until November 29, 2030 (for the  August 1 through October 30, 2030 reporting period). Lists four required components for each report including the total amount of funds allocated to each initiative identified, the total amount of funds awarded to subrecipients by county, as described, as well the specified reports and updates.

Part III-C.

Section 3C.1.

Specifies that DHHS is not required to maintain, after June 30, 2027, any modifications to the Medicaid program required by Part III-C, except for statutory changes or where otherwise specified.

Section 3C.2.

Notwithstanding the limitations under GS 143C-4-11 on the use, allocation, and expenditure of funds reserved in the Medicaid Contingency Reserve (MCR), appropriates $319 million from the MCR to DHHS’s Division of Health Benefits (DHB) for the 2025-26 year to be used 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. Retroactive to July 1, 2025.

Section 3C.3.

Instructs the four listed local management entities/managed care organizations (LME/MCOs) to make intergovernmental transfers to DHB in an aggregate amount of $18,028,217 for both the 2025-26 and 2026-27 years. Specifies that the due date and frequency of the intergovernmental transfer required by the act will be determined by DHB. Specifies the amounts that each of the four individual LME/MCOs is required to make in each fiscal year. Specifies that in the event that a county disengages from an LME/MCO and realigns with another LME/MCO during the 2025-27 biennium, DHB has the authority to reallocate the amount of the intergovernmental transfer that each affected LME/MCO is required to make under the act, taking into consideration the change in catchment area and covered population, provided that the aggregate amount of the transfers received from all LME/MCOs in each year of the fiscal biennium is achieved.

Effective retroactive to July 1, 2025.

Section 3C.4.

Clarifies that DHHS will provide Medicaid coverage in GS 108A-54.34(a)(24) for individuals who are in compliance with or exempt from applicable community engagement requirements (was, persons in compliance with any federally approved work requirements as described).

Further amends GS 108A-54.34, as amended above so that DHHS is no longer required to provide medical coverage to refugees, qualified aliens subject to the five-year bar for means tested public assistance, and emergency services to undocumented aliens under the specified federal laws. Instead, directs that Medicaid coverage for individuals who are not citizens of the United States are limited to coverage that is federally required for the State's participation in the Medicaid program. Removes qualified aliens subject to the five-year bar for means tested public assistance from those groups who are exempted from capitated Prepaid Health Program (PHP) contracts. Makes technical changes. Effective October 1, 2026.

Section 3C.5.

Adds new GS 108A-55.7, (community engagement requirements), requiring that at the time of initial application for medical assistance benefits, the applicant must provide satisfactory proof that the applicant has complied with any applicable community engagement requirements for the three consecutive months immediately preceding the month the applicant submits the application for medical assistance benefits. Imposes the same three-month requirement at the time of redetermination for eligibility of medical assistance benefits. Directs DHHS to take all actions necessary to implement and maintain those work requirements to the fullest extent allowed so long as they are authorized as a condition of participation in Medicaid by CMS. Effective January 1, 2027.

Section 3C.6.

Amends DHHS’s eligibility monitoring for medical assistance under GS 108A-55.5 so that it includes gambling winnings and it occurs at least monthly (was, at least quarterly). Effective October 1, 2026.

Section 3C.7.

Adds new GS 108A-55.6 preventing DHHS or a county DSS from accepting self-attestation as the only evidence of eligibility requirements for Medicaid, except as required by federal law, regulation, or pursuant to a court order. Effective October 1, 2026.

Section 3C.8.

Adds new GS 108A-55.8 specifying that, except as otherwise provided by federal law or regulation, the income of a household member who is ineligible for medical assistance benefits due to the household member's immigration status must be counted when calculating and determining an individual's financial eligibility for medical assistance benefits. Effective October 1, 2026.

Section 3C.9.

Requires, in GS 108A-80, for DHHS to promptly refer any applicant or recipient for which citizenship or satisfactory immigration status could not be verified to the United States Department of Homeland Security or any other appropriate federal authority for investigation and enforcement under the circumstances described. Makes conforming changes. Effective October 1, 2026.

Section 3C.10.

Requires the Office of the State Auditor (Auditor) to conduct a performance audit of the administration of the North Carolina Medicaid program and the NCWorks Career Centers. Effective July 1, 2026, appropriates $500,000 for 2026-27 from the General Fund to the Auditor for the audit.

Section 3C.11.

Adds new GS 108A-64.2, requiring DHHS to submit an annual report by October 1 to the specified NCGA committee and division containing an accounting of all improper Medicaid payments and expenditures, total amount of federal and State recovered funds, and aggregate data concerning improper payments as described.

Section 3C.12.

Authorizes a PHP to develop a closed network for a designated service category if an open network would jeopardize quality of care, program integrity, or cost-effective use of Medicaid fund in GS 108D-22 (PHP networks). Provides for DHHS approval before a PHP creates a closed network. Expands the reasons that a PHP can exclude an individual provider to include the clean claims rate deficiencies as set forth in new GS 108C-7(e3) (discussed below). Makes technical, conforming, and organizational changes. Removes provision from GS 108-23 (BH IDD tailored plan provider networks) specifying that with regard to services and supports that are covered benefits under both standard benefit plans and BH IDD tailored plans, each LME/MCO is subject to the same provider network requirements applicable to PHPs under GS 108D-22. Makes technical and conforming changes. Removes definition of closed network from GS 108D-24 (children and families specialty plan networks) and makes conforming changes.

Section 3C.13.

Adds defined term prepaid health plan or PHP to GS 108C-2. Makes the following changes to GS 108C-7 (prepayment claims review). Removes requirement that the prepayment claims review be instituted no less than 20 calendar days from the date of mailing the written notice and instead prevents it from beginning prior to the date of mailing that notice. Increases the provider’s required clean claims rate from 70% to 80% for three consecutive months. Removes twenty-four month limit on prepayment claims review. Specifies that in any contract with a PHP in which DHHS authorizes a PHP to carry out its authority under to require a provider to undergo prepayment claims review:

1. DHHS won’t require the PHP to obtain its approval before the prepayment claims review is instituted for a particular provider, unless the approval is required by federal law or regulation.
2. The PHP will send a copy of notice required by the statute to DHHS, when sending that notice.
3. The PHP can exclude a provider from its network if: (i) the provider does not meet the 80% clean claims rate minimum requirement for three consecutive months within six months of being placed  on prepayment claims review 24 (ii) the PHP has received approval from DHHS of the PHP's written request to remove that provider from the PHP's network of providers. Specifies that if DHHS does not respond to a written request from a PHP for approval to remove a provider from the PHP's network of providers within 90 days after the request was submitted, the request is deemed approved.

Applies to prepayment claims reviews instituted and contracts entered into or amended on or after Section 3C.13 becomes law.

Section 3C.14.

Directs DHB to develop a plan for improved health outcomes, program integrity, cost-savings, and efficiency measures in the Medicaid program, covering at least the eight required prongs described. Requires DHB to submit a report on the plan to the specified NCGA committee and division by October 1, 2026.

Section 3C.15.

Prohibits, in GS 108D-65, DHHS from preventing PHP’s from requiring itemized bills for inpatient hospital outlier claims that are greater than $250,000 or more than standard deviations from the median claim amount of the applicable billing code. Applies to contracts entered into or amended after the section becomes law.

Section 3C.16.

Adds new GS 108A-58.3 requiring DHHS to annually establish all Medicaid copayments at the maximum rate allowed under federal law, effective July 1, 2027.

Section 3C.17.

Retroactive to July 1, 2025, amends Section 11 of SL 2020-88, as amended, so that the reimbursement for durable medical equipment and supplies, orthotics, and prosthetics under managed care continues to be set at 100% until June 30, 2027 (previously, 100% rate only for the first five years of the initial standard benefit plan). Makes a conforming change.

Section 3C.18.

Requires DHB to amend, and if necessary, seek approval from CMS, for the nine described changes to the NC Medicaid Clinical Coverage Policy 8F, Research-Based Behavioral Health Treatment (RB-BHT) For Autism Spectrum Disorder (CCP-8F), and adopt or amend any relevant rules that incorporate those changes. Those nine changes include limits on telehealth, as described. Authorizes DHB to develop exceptions to the telehealth limitations based upon documented medical necessity, as described. Requires DHB to submit a report to the specified NCGA committees identifying any proposed exception and providing details supporting the need for the exception.

Specifies in GS 108C-9 (provider enrollment criteria) that Board Certified Behavior Analysts and Qualified Autism Services Practitioner Supervisors are not permitted to enroll in the North Carolina Medicaid program as out-of-state providers. Applies to all applications for enrollment submitted on or after the section becomes law.

Authorizes DHB to adopt rules to either recoup payments or in certain instances suspend their eligibility to bill Medicaid for a provider’s noncompliance with any of the requirements set forth in this section.

Part III-D.

Section 3D.1.

Declares the intent of the General Assembly to provide funding for the increased administrative costs of compliance with frequency of eligibility redeterminations requirements and community engagement requirements in the Medicaid program from a source that meets the limitations on funding sources in GS 108A-54.3B for NC Health Works.

Section 3D.2.

Amends GS 108A-146.1 (public hospital modernized assessment) so that starting July 1, 2026, the public hospital modernized assessment quarterly percentage will equal the modernized intergovernmental transfer (IGT) actual receipts adjustment component under GS 108A-146.14 divided by the total hospital costs for all public acute care hospitals holding a license on the first day of the assessment quarter. Specifies that the current percentage for each quarter set forth in GS 108A-146.1(c) only goes through June 30, 2026.

Adds new GS 108A-146.1A, specifying that the public hospital modernized presumptive IGT offset amount is the aggregate acute care  hospital modernized assessment collection amount under GS 108A-146.5 multiplied by the public hospital historical assessment share. Modifies the calculation for the aggregate acute care hospital modernized assessment collection amount in GS 108A-146.5.

Specifies, in GS 108A-146.14 (modernized IGT actual receipts adjustment component) that the modernized IGT actual receipts adjustment component is a dollar amount (was, positive or negative dollar amount) equal to the amount of the modernized presumptive IGT adjustment component under GS 108A-146.13(c) for the previous quarter minus the amounts described. Directs that if this calculation results in a negative number, the modernized IGT actual receipts adjustment component is zero.

Effective October 1, 2026, directs that the modernized IGT actual receipts adjustment component under GS 108A-146.14 as amended above, is a dollar amount equal to the amount of the modernized presumptive IGT adjustment component under GS 108A-146.13(c) for the previous quarter plus the public hospital modernized presumptive IGT offset amount under GS 108A-146.1A for the previous quarter minus the amounts described. Applies to assessment imposed on or after October 1, 2026.

Amends GS 108A-147.1 (public health advancement assessment), as follows. Beginning July 1, 2026, specifies that the public hospital health advancement assessment quarterly percentage equals the health advancement IGT actual receipts adjustment component under GS 108A-147.10 divided by the total hospital costs for all public acute care hospitals holding a license on the first day of the assessment quarter. Specifies that the current percentage for each quarter set forth in GS 108A-147.1(c) only goes through June 30, 2026.

Adds GS 108A-147.1A specifying that the public hospital health advancement presumptive IGT offset amount is the aggregate acute care hospital health advancement assessment collection amount under GS 108A-147.3 multiplied by the public hospital historical assessment share. Modifies the calculation for the aggregate health advancement assessment collection set forth in GS 108A-147.3(a).

Specifies, in GS 108A-147.10 (health advancement IGT actual receipts adjustment component), that the health advancement IGT actual receipts adjustment component is a dollar amount (was, positive or negative dollar amount) equal to the health advancement presumptive IGT adjustment component calculated under GS 108A-147.9 for the previous quarter, plus the positive or negative total IGT share of the reconciliation adjustment component calculated under GS 108A-147.11(e)(was, GS 108A-147.11(b)) for the previous quarter  minus the amounts described. Directs that if this calculation results in a negative number, the health advancement IGT actual receipts adjustment component is zero.

Effective October 1, 2026, further modifies GS 108A-147.10, as amended above so that the that the health advancement IGT actual receipts adjustment component is a dollar amount equal to the health advancement presumptive IGT adjustment component calculated under GS 108A-147.9 for the previous quarter, plus the positive or negative total IGT share of the reconciliation adjustment component calculated under GS 108A-147.11(e) for the previous quarter plus the public hospital health advancement presumptive IGT offset amount for the previous quarter minus the amounts described. Applies to assessments imposed on or after October 1, 2026.

Amends GS 108A-147.11(a) and (b) so that existing references in the subsections to “IGT share” become “base IGT share.” Specifies that the “supplemental IGT share” of the reconciliation adjustment component is a positive or negative dollar amount that is calculated by subtracting the base IGT share of the reconciliation adjustment component from the health advancement reconciliation component. Instructs that the total IGT share of the reconciliation adjustment component is a positive or  negative dollar amount that is the sum of the base IGT share of the reconciliation adjustment component calculated and the supplemental IGT share of the reconciliation adjustment component.

Effective July 1, 2026, and applies to assessments imposed on or after that date, except as otherwise provided.

Section 3D.3.

Makes each private and public acute care hospital subject to a 2026 one-time assessment that is a percentage of its hospital costs. Deposits the proceeds of the assessments and intergovernmental transfer receipts in the Health Advancement Receipts Special Fund to be used for the increased administrative costs described in Section 3D.1. Requires DHHS to use $7.8 million from the proceeds for funding to county departments of social services to support them with increased administrative costs under Section 3D.1. Sets out the procedure under which the hospital assessments are to be imposed. Requires DHHS to report by February 1, 2027, to the specified committee and division on the amount of the proceeds from the assessments that DHHS provided to each county department of social services and the date that they were provided.

Section 3D.4.

Amends GS 108A-147.7 concerning the administration component of hospital assessments, to now refer to it as the base administration component. Removes outdated language.

Enacts new GS 108A-147.7A creating the supplemental administration component which is an amount calculated by adding the supplemental State administration subcomponent and the supplemental county administration subcomponent; sets out provisions for determining the amount of these components based on the fiscal year, with the amounts zeroing out for fiscal year beginning on or after July 1, 2036.

Amends GS 108A-147.3 by amending the calculation of the quarterly total nonfederal receipts for health advancement so that it also includes adding in the supplemental administration component.

Amends GS 108A-147.9 by also adding the supplemental administration component within the calculations of the public hospital health advancement IGT adjustment subcomponent, the UNC Health Care System health advancement IGT adjustment subcomponent, and the East Carolina University health advancement IGT adjustment subcomponent.

Amends GS 108A-147.13 to require the amount of the proceeds of the health advancement assessment that provides funding to county departments of social services to support counties in determining eligibility for newly eligible individuals, to be calculated so that the assessment is equal to the sum of the base county administration subcomponent and the supplemental county administration subcomponent. Makes conforming changes to cap on the amount of the proceeds that may be used for administrative expenses.

Applies to assessments imposed on or after July 1, 2026.

Section 3D.5.

Requires DHB to report by October 1, 2029, to the specified committees and division on: (1) estimated share of the actual administrative costs expended through June 30, 2029, by DHB that is attributable to compliance with the requirements in Section 3D.1 of this act; (2) description of any reduction to the administrative costs described in Section 19 3D.1  due to actions taken by DHB to achieve efficiencies or decreases in enrollment in NC Health Works; (3) total amount of assessment receipts and intergovernmental transfer receipts from April 1, 2026, through June 30, 2029, attributable to GS 108A-147.7A or Section 3D.3l; (4) proposal for crediting against future assessments owed under Article 7B of GS Chapter 108A  any amounts under (3) that exceed the amount under (1); and (5) proposed legislative changes to ensure that hospital assessment and intergovernmental transfer amounts attributable to GS 108A-147.7A do not exceed the administrative costs of complying with Section 3D.1 of this act.

Section 3D.6.

Requires DHB, if it determines that the requirements described in Section 3D.1 of this act as applied to NC Health Works will be modified or eliminated due to a change in federal or State law, rule, or regulation in a way that will reduce the administrative costs, to report on its determination to the specified committees and division. Requires the report to made 60 days after DHB identifies the anticipated modification or elimination and for it to include four specified items, including a proposal for a decrease or elimination of the amounts included in the hospital assessments that corresponds to the anticipated reduction in administrative costs. Expires June 30, 2036.

Section 3D.7.

Requires the DHB, when developing the average commercial rate demonstration for the Healthcare Access and Stabilization Program (HASP), to use the payment method or approach with the maximum allowable level of HASP reimbursements to hospitals that receives federal approval. Requires DHB to report to the specified committees and division if it determines that many of the following have been met: (1) Centers for Medicare and Medicaid Services approved a HASP preprint that is less than 95% of the maximum allowable amount for HASP under federal law or regulation; (2) the gross HASP reimbursement to hospitals approved by CMS for a fiscal year are less than $1.5 billion; (3) the gross HASP reimbursement paid to hospitals, on an accrual basis, for a fiscal year are less than $1.5 billion; or (4) a change in federal law or regulation resulted in adjusted hospital intergovernmental transfers, in a quarter, that were at least 20% lower than the amount of base hospital intergovernmental transfers for that quarter. Makes the report due 120 days after DHB’s determination that one of the conditions has been met. Requires DHB giving at least 30 days before submitting the report, for the North Carolina Healthcare Association to review the determination and provide confirmation or disagreement.

Amends GS 108A-147.7A, as enacted in Section 3D.4 of this act, as follows, effective on the first day of the next assessment quarter that is two years after the date the report is submitted. Removes the provisions setting out the amount of the supplemental State administration subcomponent and the supplemental county administration components for specified quarters and sets those quarterly amounts at zero.

Effective on the first day of the next assessment quarter that is two years after the date the report is submitted, repeals Section 3D.6 of this act.

Expires July 1, 2034, if no report has been submitted by that date.

Section 3D.8.

Requires the DHHS, DHB to report by October 1, 2031, to the specified committees and divisions outlining options for continued funding of the increased administrative costs discussed in Section 3D.1 after June 30, 2036.

Part III-E.

Section 3E.1.

Amends GS 131D-6.1 concerning rules for licensure of adult day care and adult day health facilitates providing a program of overnight respite services by expanding upon the staffing requirements by setting out minimum staffing requirements, including requiring each facility to have staff on duty to meet each participant’s needs, requirements for the number of staff that must be present and awake and qualified to administer medication and trained to provide personal care and supervision based on the facility’s census, and prohibiting these staff from performing housekeeping or food services during shifts when they are responsible for providing personal care and supervision (requires additional staff for those purposes). Prohibits bed capacity limitation from exceeding 12 beds in each facility licensed to provide a program of overnight respite services. Effective July 1, 2026.

Allows the Medical Care Commission to adopt emergency and temporary rules to implement these provisions.

Part III-F.

Section 3F.1.

Enacts new GS 108A-52.1 prohibiting using self-attestation as the only evidence that an applicant is eligible for the food and nutrition services program, unless otherwise required by federal law. Requires counting all of a person’s income and financial resources determined to be ineligible to participate in the food and nutrition services program when determining eligibility and benefit allotment of the person’s household.

Section 3F.2.

Requires OSBM to consult with the Department of Health and Human Services (DHHS) to develop and issue a request for proposal (RFP) by October 31, 2026, to contract with a third party to exam opportunities to improve the efficiency, accuracy, and cost-effectiveness of having DHHS administer all federally and State mandated social services. Sets out seven issues that must be considered in the study. Requires a report of the specified NCGA committees and division by June 30, 2027, on centralizing the administration of all federally and State mandated social services with DHHS based on the information compiled by the study and any other available information. Sets out other information that must include in the report. Effective July 1, 2026, appropriates $1 million from the General Fund to OSBM for 2026-27 to contract for the study.

Part IV.

Section 4.1.

Amends Section 2C.2 of SL 2025-89 concerning the $118.1 million appropriation from the Stabilization and Inflation Reserve to the Department of Commence if the Economic Investment Committee (EIC) awarded a Job Development Investment Grant for a qualifying transformative project for an airplane manufacturer in Guilford County, to be used for site acquisitions and improvements, as follows. Amends the definition of a qualifying transformative project so that the $4.5 billi0n that must be invested can be in private funds or funds provided by federal or foreign governments or their respective departments, agencies, divisions, or units, or both. Allows the business that is benefitted by the funds, with the EIC’s approval, to encumber its interest, or grant security interest in its interest, in the land or improvements as collateral for financing obtained by the business to finance the project so long as the collateral does not include any interest of the business in the land or improvements for which funds were allocated for specified costs. Amends those specified costs as follows. Amends the conditions the $10.2 million allocated for renovation costs of, and capital improvements to, an existing airport hub to render it suitable for the project and to make it owned by the Authority to provide that if these funds that are in excess may be allocated for the same purposes for which the $35 million may be for costs related to construction of the facility for manufacturing, research, and development; amends the allowable uses of that $35 million allocation to by expanding upon allowable uses to include demolition, infrastructure enhancement and upgrades, fees for insurance, and sidewalks and a pedestrian bridge and allows excess funds to be reallocated for the uses allocated for the $10.2 million in funds.

Section 4.2.

Allows funds allocated to Hertford in SL 2023-134 for water capacity increase to be used by the Town for any water or wastewater infrastructure project.

Part V.

Section 5.1.

Appropriates $80 million from the General Fund to the Department of Adult Correction for 2025-26 to be used to address a shortfall in operating funds for the Department.

Section 5.2. 

Appropriates from the General Fund to the State Bureau of Investigation (1) $2.5 million in recurring funds beginning in the 2025-26 fiscal year and (2) $1.2 million in nonrecurring funds for 2025-26 to be used to address a shortfall in operating funds for the Bureau.

Section 5.3.

Appropriates $165,000 from the General Fund to the Administrative Office of the Courts, Budget Fund 100064, for 2025-26 to be used to extend the case-management software used by the North Carolina Business Court that is in addition to the eCourts system.

Part VI.

Section 6.1.

Amends the following directed grants allocated by OSBM for the 2023-24 fiscal year. Grants any remaining funds from the $2 million grant to the Mayland Community College Foundation, Inc., for the Avery-Mitchell animal shelter, to Avery and Mitchell counties for any public purpose. Reallocates the $800,000 grant to Selma for economic development project recruitment to Johnston County Economic Development Corporation for the same purpose. Reallocates the $5 million grant to Iredell County for capital improvements or equipment at the fairgrounds to the Iredell County Sheriff’s office for a new safety building on Lake Norman to the Statesville for water and wastewater projects pertaining to the specified economic development, in the specified amounts. Requires that the $1.6 million grant to Harnett County for land or capital improvements related to Johnson Farm be used instead for renovations of existing parks, improvements in park safety and accessibility, and development of green spaces, trails, and greenways. Reallocates the funds for a grant to the Burke Partnership for Economic Development, Inc., for water and wastewater at the Western NC Megasite that are unspent and unencumbered be reallocated to Burke County for water and wastewater projects in the County.

Part VII.

Section 7.1.

Appropriates $13.1 million in recurring funds beginning with the 2025-26 fiscal year and $8.5 million in nonrecurring funds in the 2025-26 fiscal year from the Highway Fund to the Department of Transportation, Division of Motor Vehicles (DMV), to address a shortfall in operating funds.  Also requires the OSBM to consult with the DMV to align credit card receipt line items with actual collections and make necessary adjustments to collection projections and Base Budget requirements.

Part VIII.

Section 8.1.

Specifies that if the act and GS 143C-5-4 conflict, then this act prevails. Makes the appropriations and authorization to allocate and spend funds in this act effective until the Current Operations Appropriations Act for the application fiscal year becomes law, at which time it will govern.

Part IX.

Section 9.1.

Specifies that the act is effective when it becomes law, expect as otherwise provided.