Contains whereas clauses.

Part I.

Adds new GS 115C-302.5A, setting a monthly teacher salary schedule for "A" teachers for 2026-27 for licensed public school personnel classified as teachers, based on years of experience, ranging from $4,387 for teachers with 0 years of experience to $5,987 for 25 or more years of experience.

Beginning with 2027-28 and ending with 2032-33 directs the Department of Public Instruction (DPI) to raise the monthly amounts for each step of the teacher salary schedule each fiscal year 3.67%. From 2033-34 onward, required DPI to raise the monthly amounts for each step of the teacher salary schedule for each fiscal year by the sum of one plus the 12-month percent change in the second quarter Employment Cost Index for elementary and secondary school workers as reported by the Federal Bureau of Labor Statistics.

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 monthly salary supplement of $100 for school counselors licensed 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 salary supplement of the higher of $350 or 10%. 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 2026-27 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. 

Requires DPI to provide annual reports to the specified NCGA committee and to publish those reports on its website by February 15, starting in 2027.

Adds GS 115C-302.5C, creating the Teacher Salary Reserve (Reserve), administered by DPI to provide teacher raises in accordance with new GS 115C-302.5C. Lists appropriations to the Reserve from the General Fund starting in 2026-27 ($825.1 million) through 2032-33 ($2,163,700,000). For each fiscal year after the 2032-23 fiscal year, increases the appropriations from the General Fund to the Reserve by $283.2 million over the amount appropriated or the preceding fiscal year. Tasks the Director of the Budget with implementing the above appropriations.

Adds GS 115C-302.6, directing the State Board of Education (SBE) to allocate funds to eligible local school administrative units to provide salary supplements to teachers and qualifying school administrators in those units. Prevents SBE from allocating those funds if it determines that a local school administrative unit has supplanted non-State funds received under the statute.  Defines sixteen terms. Provides methods for calculating county allocations, per teacher funding amounts, and unit funding amounts (caps at $5,000 per eligible teacher). Provides for charter school funding. Requires SBE to submit an annual report on the seven matters related to supplemental funding to the specified NCGA division and committee.

Amends Section 3.3 of SL 2025-89 so that the supplemental teacher funds authorized by that section only apply to the 2025-26 school year.

Effective July 1, 2026, and applies beginning with the 2026-2027 school year.  

Part II.

Amends GS 115C-562.1 by redefining an eligible student as a student residing in North Carolina who has not yet received a high school diploma and who meets certain requirements. Requires an eligible student to satisfy one of the following criteria: (1) full-time attendance at a NC public school or a Department of Defense (DOD) school located in NC; (2) receipt of a previous scholarship grant; (3) attainment of the age to start school; (4) placement in foster care; (5) adoption one year or less before the scholarship grant application; (6) parent or legal guardian who is active duty or who has been discharged within 12 months prior to application; or (7) both enrollment in a nonpublic school during spring semester prior to the school year for which the student is applying and was previous enrollment in either a NC public school or a DOD school located in NC. Prohibits an eligible student from enrolling in a postsecondary institution earning 12 hours of academic credit. Requires the eligible student to either reside in a household with an income level not exceeding 200% of the federal free or reduced-price lunch eligibility threshold or is in foster care. Excludes distributions from the estate of a decedent the calculation of income and the household income of the foster parent.

Adds definitions of full-time student (a student enrolled exclusively in a nonpublic school whose parents have released the local school administrative unit of all obligations to educate the eligible student while the student is receiving a scholarship grant) and part-time student (a student enrolled part time in a public school and part time in a nonpublic school).

Amends GS 115C-562.2 to require the State Education Assistance Authority (Authority) to begin awarding scholarship grants on March 15. Sets out the priority for awarding the grants, with first priority given to eligible students who received a grant for the school year prior to the application if they applied by March 1, and 50% of the remaining funds are to be disbursed to eligible students residing in households with an income level not exceeding the federal free or reduced-price lunch eligibility threshold, and the rest disbursed to all other eligible students.

Replaces subsections (b2), (b3), and (b4) with subsection (a1) which sets out the criteria for determining the amount of the scholarship grant. Limits the grant to $7,942 for full-time students and $3,971 for part-time students residing in households with an income level not exceeding the federal free or reduced-price lunch eligibility threshold. Limits the grant to $7,148 for full-time students and $3,574 for part-time students of the required tuition and fees for the nonpublic school the student will attend for eligible students residing in households with an income level exceeding the federal free or reduced-price lunch eligibility threshold. Allows a nonpublic school to include tuition and fees for books, transportation, equipment, or other items required by the nonpublic school. Prohibits scholarship grants from exceeding the required tuition and fees for the nonpublic school, as applicable to the eligible student.

Removes language from GS 115C-562.8 (opportunity scholarships [Scholarship]) articulating the importance of funding the Scholarship for fifteen years. Reduces the Scholarship funding set forth in the statute from $700 million to $320 million for 2027-28, continuing to decrease funds until it is at $250 million instead of $800 million for 2031-32. Appropriates $235 million for fiscal years 2032-33 and beyond.

Specifies that eligible student who receives a Scholarship in the 2026-2027 school year is  eligible to receive a scholarship in the 2027-28 fiscal year, at the same funding level as the prior year.  Reduces the unencumbered, nonrecurring funds available at the end of the 2025-26 that would otherwise be carried forward in 2026-27 for Scholarships by $150 million. Reduces the funds appropriated for Scholarships for 2026-27 to be awarded in 2027-28 by $110 million. Applies beginning with applications for Scholarships in the 2027-28 school year.